RECEIVABLES LOAN AGREEMENT


By and Between 

LIBERTY BANK


and


BLUEGREEN CORPORATION


Dated: August 27, 2008












Table of Contents


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
 

	
 

	
 

	
 

	
Page


	
 

	
 

	
 

	
 

	
 

	



	
 

	
 

	
 

	
 

	
 

	
 


	
1.

	
Definitions
 and Construction

	
 

	
1


	
 

	
 

	
1.1

	
Definitions

	
 

	
1


	
 

	
 

	
1.2

	
Construction

	
 

	
16


	
 

	
 

	
1.3

	
Schedules and Exhibits

	
 

	
16


	
 

	
 

	
1.4

	
Accounting Principles

	
 

	
16


	
2.

	
The
 Receivables Loan

	
 

	
16


	
 

	
 

	
2.1

	
Loan
 Amount

	
 

	
16


	
 

	
 

	
2.2

	
Advances

	
 

	
16


	
 

	
 

	
2.3

	
Requests for Advance

	
 

	
19


	
 

	
 

	
2.4

	
Limitation
 on Amount of Advances

	
 

	
20


	
 

	
 

	
2.5

	
Supplementary
 Advances

	
 

	
20


	
 

	
 

	
2.6

	
Loan
 Account

	
 

	
20


	
 

	
 

	
2.7

	
Receivables Loan Note

	
 

	
20


	
 

	
 

	
2.8

	
Amounts
 in Excess of Maximum Receivables Loan Amount

	
 

	
20


	
 

	
 

	
2.9

	
Use of Proceeds

	
 

	
21


	
 

	
 

	
2.10

	
Closing

	
 

	
21


	
 

	
 

	
2.11

	
Initial Request for
 Advance

	
 

	
21


	
 

	
 

	
2.12

	
Extension
 of the Receivables Loan Advance Period

	
 

	
21


	
 

	
 

	
2.13

	
Allocation
 of Pledged Timeshare Loans Among Lenders

	
 

	
21


	
3.

	
Interest
 Rate

	
 

	
21


	
 

	
 

	
3.1

	
Primary
 Interest Rate

	
 

	
21


	
 

	
 

	
3.2

	
Default Rate

	
 

	
22


	
 

	
 

	
3.3

	
Calculation of Interest

	
 

	
22


	
 

	
 

	
3.4

	
Limitation
 of Interest to Maximum Lawful Rate

	
 

	
22


	
4.

	
Fees

	
 

	
22


	
 

	
 

	
4.1

	
Receivables Loan Fee

	
 

	
22


	
 

	
 

	
4.2

	
Late
 Charge

	
 

	
23


	
 

	
 

	
4.3

	
Non-Utilization
 Fee

	
 

	
23


	
 

	
 

	
4.4

	
Renewal Fee

	
 

	
23


	
 

	
 

	
4.5

	
Change of Control Fee

	
 

	
23


	
5.

	
Payments

	
 

	
24


	
 

	
 

	
5.1

	
Collections

	
 

	
24


	
 

	
 

	
5.2

	
Additional Mandatory
 Payments

	
 

	
24


	
 

	
 

	
5.3

	
Minimum
 Payments

	
 

	
25


	
 

	
 

	
5.4

	
Final Payment Date

	
 

	
25


	
 

	
 

	
5.5

	
Reinstatement
 of Obligations

	
 

	
25


	
 

	
 

	
5.6

	
Prepayments

	
 

	
25


	
 

	
 

	
5.7

	
Change
 of Control Payment

	
 

	
27


	
 

	
 

	
5.8

	
Application of Payments

	
 

	
27


	
 

	
 

	
5.9

	
Indemnity

	
 

	
27


	
 

	
 

	
5.10

	
General

	
 

	
27


	
6.

	
Security;
 Guaranties

	
 

	
27





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Page


	
 

	
 

	
 

	
 

	
 

	



	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
 

	
6.1

	
Security

	
 

	
27


	
 

	
 

	
6.2

	
Endorsement
 of Notes; Assignment and Delivery

	
 

	
29


	
 

	
 

	
6.3

	
Lockbox
 Agreement

	
 

	
29


	
 

	
 

	
6.4

	
Servicing
 Agreement

	
 

	
30


	
 

	
 

	
6.5

	
Custodial
 Agreement

	
 

	
31


	
 

	
 

	
6.6

	
Notice
 to Purchasers

	
 

	
31


	
 

	
 

	
6.7

	
Payments
 to be Forwarded

	
 

	
32


	
 

	
 

	
6.8

	
Cancellation
 and Modifications of Notes

	
 

	
32


	
 

	
 

	
6.9

	
Permitted Contests

	
 

	
32


	
7.

	
Representations
 and Warranties

	
 

	
32


	
 

	
 

	
7.1

	
Organization;
 Power

	
 

	
32


	
 

	
 

	
7.2

	
Licenses

	
 

	
33


	
 

	
 

	
7.3

	
Transaction
 is Legal and Enforceable

	
 

	
33


	
 

	
 

	
7.4

	
Due
 Authorization; No Legal Restrictions

	
 

	
33


	
 

	
 

	
7.5

	
No
 Breach or Default of Other Agreements; Compliance with Other Agreements

	
 

	
33


	
 

	
 

	
7.6

	
Litigation

	
 

	
34


	
 

	
 

	
7.7

	
Taxes

	
 

	
34


	
 

	
 

	
7.8

	
Insurance

	
 

	
34


	
 

	
 

	
7.9

	
Consents

	
 

	
35


	
 

	
 

	
7.10

	
No Violation of Law

	
 

	
35


	
 

	
 

	
7.11

	
Financial
 Statements

	
 

	
35


	
 

	
 

	
7.12

	
No
 Material Adverse Change in Financial Condition

	
 

	
35


	
 

	
 

	
7.13

	
Title
 to Collateral

	
 

	
35


	
 

	
 

	
7.14

	
Names,
 Addresses and States of Formation

	
 

	
36


	
 

	
 

	
7.15

	
Current
 Compliance

	
 

	
36


	
 

	
 

	
7.16

	
Pension
 Plans

	
 

	
36


	
 

	
 

	
7.17

	
Use
 of Proceeds/Margin Stock/Governmental Regulations

	
 

	
36


	
 

	
 

	
7.18

	
Solvency

	
 

	
37


	
 

	
 

	
7.19

	
Insurance

	
 

	
37


	
 

	
 

	
7.20

	
Tax
 Identification Number

	
 

	
37


	
 

	
 

	
7.21

	
Purposely
 Omitted

	
 

	
37


	
 

	
 

	
7.22

	
Restrictive
 Contracts

	
 

	
37


	
 

	
 

	
7.23

	
Closing
 Date Indebtedness

	
 

	
37


	
 

	
 

	
7.24

	
Completeness of
 Representations

	
 

	
37


	
8.

	
Representations,
 Warranties and Covenants With Respect to the Project

	
 

	
38


	
 

	
 

	
8.1

	
Access, Utilities and
 Parking

	
 

	
38


	
 

	
 

	
8.2

	
Compliance

	
 

	
38


	
 

	
 

	
8.3

	
Declarations

	
 

	
38


	
 

	
 

	
8.4

	
Zoning
 Laws, Building Codes, Etc

	
 

	
38


	
 

	
 

	
8.5

	
Unit
 Ready for Use

	
 

	
38


	
 

	
 

	
8.6

	
Property
 Taxes and Fees

	
 

	
39


	
 

	
 

	
8.7

	
No
 Defaults

	
 

	
39


	
 

	
 

	
8.8

	
Timeshare
 Approvals

	
 

	
39





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8.9

	
Sale
 of Timeshare Interests

	
 

	
39


	
 

	
 

	
8.10

	
Brokers

	
 

	
39


	
 

	
 

	
8.11

	
Tangible
 Property; Non-Disturbance Agreements

	
 

	
40


	
 

	
 

	
8.12

	
Condition of Project

	
 

	
40


	
 

	
 

	
8.13

	
Assessments

	
 

	
40


	
 

	
 

	
8.14

	
Developer Subsidy

	
 

	
40


	
 

	
 

	
8.15

	
Project Documents

	
 

	
40


	
 

	
 

	
8.16

	
Common Areas and Amenities

	
 

	
40


	
 

	
 

	
8.17

	
Trust
 Agreement

	
 

	
41


	
9.

	
Representations,
 Warranties and Covenants with Respect to the Timeshare Loans

	
 

	
41


	
 

	
 

	
9.1

	
No Defaults

	
 

	
41


	
 

	
 

	
9.2

	
Validity

	
 

	
41


	
 

	
 

	
9.3

	
Competency

	
 

	
41


	
 

	
 

	
9.4

	
Defenses;
 Rescission

	
 

	
41


	
 

	
 

	
9.5

	
Legal
 Requirements

	
 

	
42


	
 

	
 

	
9.6

	
Payments

	
 

	
42


	
 

	
 

	
9.7

	
Payments
 by Borrower

	
 

	
42


	
 

	
 

	
9.8

	
Title; Title Insurance

	
 

	
42


	
 

	
 

	
9.9

	
Right to Convey

	
 

	
43


	
 

	
 

	
9.10

	
Bankruptcy; Litigation

	
 

	
43


	
 

	
 

	
9.11

	
Authorization

	
 

	
43


	
 

	
 

	
9.12

	
Representations

	
 

	
43


	
 

	
 

	
9.13

	
Notice
 of Assignment

	
 

	
43


	
 

	
 

	
9.14

	
Marketability

	
 

	
43


	
 

	
 

	
9.15

	
Recording
 of Mortgages

	
 

	
43


	
 

	
 

	
9.16

	
Recording of Deed

	
 

	
43


	
 

	
 

	
9.17

	
Amendment

	
 

	
43


	
 

	
 

	
9.18

	
Assignment; No Liens

	
 

	
43


	
 

	
 

	
9.19

	
Loan
 File

	
 

	
44


	
 

	
 

	
9.20

	
Public Reports

	
 

	
44


	
 

	
 

	
9.21

	
Credit

	
 

	
44


	
 

	
 

	
9.22

	
Qualified Timeshare Loans

	
 

	
44


	
 

	
 

	
9.23

	
Enforceability

	
 

	
44


	
 

	
 

	
9.24

	
No Impairment

	
 

	
44


	
 

	
 

	
9.25

	
No Defaults

	
 

	
44


	
 

	
 

	
9.26

	
Assumption

	
 

	
44


	
 

	
 

	
9.27

	
Executory
 Obligations

	
 

	
44


	
 

	
 

	
9.28

	
Fulfillment
 of Obligations to Purchasers

	
 

	
45


	
10.

	
Consumer Documents

	
 

	
45


	
11.

	
Payment or Replacement of
 Timeshare Loans

	
 

	
45


	
 

	
 

	
11.1

	
Delinquent
 Loans

	
 

	
45


	
 

	
 

	
11.2

	
Replacement

	
 

	
46


	
 

	
 

	
11.3

	
Documents

	
 

	
46





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Page


	
 

	
 

	
 

	
 

	
 

	



	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
 

	
11.4

	
Application
 of Representations and Warranties to Replacement Timeshare Loans

	
 

	
46


	
12.

	
Reassignment
 of Timeshare Loans by Lender; Collection Proceedings; Etc

	
 

	
46


	
 

	
 

	
12.1

	
Collection
 Proceedings

	
 

	
46


	
 

	
 

	
12.2

	
Reassignments

	
 

	
47


	
13.

	
General
 Affirmative Covenants

	
 

	
47


	
 

	
 

	
13.1

	
Payment
 of Taxes and Claims

	
 

	
47


	
 

	
 

	
13.2

	
Maintenance
 of Property

	
 

	
48


	
 

	
 

	
13.3

	
Insurance

	
 

	
48


	
 

	
 

	
13.4

	
Existence
 and Rights

	
 

	
49


	
 

	
 

	
13.5

	
Failure
 to Pay Taxes, Insurance, Etc

	
 

	
49


	
 

	
 

	
13.6

	
Books
 and Records

	
 

	
50


	
 

	
 

	
13.7

	
Inspections

	
 

	
50


	
 

	
 

	
13.8

	
Regulatory
 Approvals

	
 

	
50


	
 

	
 

	
13.9

	
Compliance With Laws, Etc

	
 

	
51


	
 

	
 

	
13.10

	
Management of Borrower

	
 

	
51


	
 

	
 

	
13.11

	
Loan
 Files

	
 

	
51


	
 

	
 

	
13.12

	
Management
 Agreements

	
 

	
51


	
 

	
 

	
13.13

	
Lockbox
 Agreement

	
 

	
51


	
 

	
 

	
13.14

	
Servicing
 Agreement

	
 

	
52


	
 

	
 

	
13.15

	
Project
 Documents

	
 

	
52


	
 

	
 

	
13.16

	
Assessments

	
 

	
52


	
 

	
 

	
13.17

	
Maintenance
 of Larger Tract

	
 

	
52


	
 

	
 

	
13.18

	
Accuracy
 of Representations and Warranties

	
 

	
52


	
 

	
 

	
13.19

	
Additional
 Documents and Future Actions

	
 

	
52


	
 

	
 

	
13.20

	
Inventory
 Controls

	
 

	
53


	
 

	
 

	
13.21

	
Trust
 Agreement

	
 

	
53


	
14.

	
Negative Covenants

	
 

	
53


	
 

	
 

	
14.1

	
Organization

	
 

	
53


	
 

	
 

	
14.2

	
No
 Transfers

	
 

	
53


	
 

	
 

	
14.3

	
Other
 Business

	
 

	
53


	
 

	
 

	
14.4

	
Affiliate
 Transactions

	
 

	
53


	
 

	
 

	
14.5

	
No
 Lien on Collateral or Reservation System

	
 

	
53


	
 

	
 

	
14.6

	
Proxies

	
 

	
53


	
 

	
 

	
14.7

	
Restrictive
 Covenants

	
 

	
53


	
 

	
 

	
14.8

	
Purposely
 Omitted

	
 

	
54


	
 

	
 

	
14.9

	
Chief
 Executive Office

	
 

	
54


	
 

	
 

	
14.10

	
Marketing/Sales

	
 

	
54


	
 

	
 

	
14.11

	
Amenities

	
 

	
54


	
 

	
 

	
14.12

	
Trust
 Agreement

	
 

	
54


	
 

	
 

	
14.13

	
Demand
 Balancing Standard

	
 

	
54


	
15.

	
Financial
 Covenants

	
 

	
54


	
 

	
 

	
15.1

	
Minimum
 Net Worth

	
 

	
54


	
 

	
 

	
15.2

	
Maximum
 Leverage

	
 

	
54





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16.

	
Financial
 Statements and Reporting Requirements

	
 

	
54


	
 

	
 

	
16.1

	
Monthly
 Reports

	
 

	
54


	
 

	
 

	
16.2

	
Annual
 Financial Statements

	
 

	
55


	
 

	
 

	
16.3

	
Annual
 Association Financial Statements

	
 

	
55


	
 

	
 

	
16.4

	
Quarterly
 Financial Statements

	
 

	
56


	
 

	
 

	
16.5

	
SEC
 Filings

	
 

	
56


	
 

	
 

	
16.6

	
Confirmation of Compliance

	
 

	
56


	
 

	
 

	
16.7

	
Audit Reports

	
 

	
56


	
 

	
 

	
16.8

	
State
 Audits

	
 

	
57


	
 

	
 

	
16.9

	
Budgets

	
 

	
57


	
 

	
 

	
16.10

	
Notices

	
 

	
57


	
 

	
 

	
16.11

	
Other
 Debt

	
 

	
57


	
 

	
 

	
16.12

	
Sales
 and Marketing Materials

	
 

	
57


	
 

	
 

	
16.13

	
Schedule
 of Purchasers

	
 

	
57


	
 

	
 

	
16.14

	
Purposely
 Omitted

	
 

	
57


	
 

	
 

	
16.15

	
Other
 Information

	
 

	
57


	
17.

	
Purposely
 Omitted

	
 

	
57


	
18.

	
Purposely
 Omitted

	
 

	
57


	
19.

	
Conditions
 of and Documents to be Delivered at the Closing

	
 

	
57


	
 

	
 

	
19.1

	
Loan
 Documents

	
 

	
58


	
 

	
 

	
19.2

	
Opinions
 of Counsel

	
 

	
58


	
 

	
 

	
19.3

	
Project
 Documents

	
 

	
58


	
 

	
 

	
19.4

	
Association
 Documents

	
 

	
58


	
 

	
 

	
19.5

	
Borrower’s
 Documents

	
 

	
58


	
 

	
 

	
19.6

	
Good Standing Certificates

	
 

	
58


	
 

	
 

	
19.7

	
Insurance

	
 

	
58


	
 

	
 

	
19.8

	
Flood Insurance

	
 

	
58


	
 

	
 

	
19.9

	
Timeshare Approvals

	
 

	
58


	
 

	
 

	
19.10

	
Authorizing Resolutions

	
 

	
58


	
 

	
 

	
19.11

	
UCC-1
 Financing Statements

	
 

	
59


	
 

	
 

	
19.12

	
Environmental
 Matters

	
 

	
59


	
 

	
 

	
19.13

	
Purposely
 Omitted

	
 

	
59


	
 

	
 

	
19.14

	
UCC-1 Search Report

	
 

	
59


	
 

	
 

	
19.15

	
Releases

	
 

	
59


	
 

	
 

	
19.16

	
Closing
 Certificates

	
 

	
59


	
 

	
 

	
19.17

	
Compliance

	
 

	
59


	
 

	
 

	
19.18

	
Survey

	
 

	
59


	
 

	
 

	
19.19

	
Title Report/Commitment

	
 

	
59


	
 

	
 

	
19.20

	
Taxes and Assessments

	
 

	
60


	
 

	
 

	
19.21

	
Preclosing
 Inspections

	
 

	
60


	
 

	
 

	
19.22

	
Expenses

	
 

	
60


	
 

	
 

	
19.23

	
Permits and Approvals

	
 

	
60


	
 

	
 

	
19.24

	
Lockbox
 Agreement

	
 

	
60





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19.25

	
Servicing
 Agreement

	
 

	
60


	
 

	
 

	
19.26

	
Compliance
 with Planning, Land Use and Zoning Stipulations

	
 

	
60


	
 

	
 

	
19.27

	
Litigation Search

	
 

	
60


	
 

	
 

	
19.28

	
Trust
 Agreement

	
 

	
60


	
 

	
 

	
19.29

	
Other

	
 

	
60


	
20.

	
Conditions
 of and Documents to be Delivered Prior to Initial Receivables Loan
 Advance 

	
 

	
61


	
 

	
 

	
20.1

	
Loan
 Documents

	
 

	
61


	
 

	
 

	
20.2

	
Other

	
 

	
61


	
21.

	
Conditions of and
 Documents to be Delivered Prior to Funding And in Connection With Each Receivables Loan Advance

	
 

	
61


	
 

	
 

	
21.1

	
Representations;
 No Defaults

	
 

	
61


	
 

	
 

	
21.2

	
Request
 for Receivables Loan Advance

	
 

	
61


	
 

	
 

	
21.3

	
Approval of Credit

	
 

	
61


	
 

	
 

	
21.4

	
Original
 Notes, Mortgages and Other Documents

	
 

	
61


	
 

	
 

	
21.5

	
Original
 Assignments

	
 

	
62


	
 

	
 

	
21.6

	
Title
 Insurance

	
 

	
62


	
 

	
 

	
21.7

	
Documents
 Received and Recorded

	
 

	
62


	
 

	
 

	
21.8

	
Subsequent
 Legal Opinions

	
 

	
63


	
 

	
 

	
21.9

	
Advances
 Do Not Constitute a Waiver

	
 

	
63


	
 

	
 

	
21.10

	
No
 Obligation to Fund After Filed Liens

	
 

	
63


	
 

	
 

	
21.11

	
Other

	
 

	
63


	
22.

	
Post
 Receivables Loan Advance Obligations

	
 

	
63


	
 

	
 

	
22.1

	
Confirmation
 of Recording

	
 

	
63


	
 

	
 

	
22.2

	
Title Policy

	
 

	
63


	
23.

	
Conditions
 to Lender’s Obligations to Advance Receivables Loan Proceeds Related to Sales of Timeshare
 Interests in Projects Added to the Primary Projects

	
 

	
64


	
 

	
 

	
23.1

	
General

	
 

	
64


	
 

	
 

	
23.2

	
Inspection

	
 

	
64


	
 

	
 

	
23.3

	
Insurance

	
 

	
64


	
 

	
 

	
23.4

	
Environmental
 Matters

	
 

	
64


	
 

	
 

	
23.5

	
Zoning,
 Access, Parking and Utilities

	
 

	
64


	
 

	
 

	
23.6

	
Flood
 Zone

	
 

	
64


	
 

	
 

	
23.7

	
Project
 Documents

	
 

	
64


	
 

	
 

	
23.8

	
Quiet
 Enjoyment Rights

	
 

	
65


	
 

	
 

	
23.9

	
Opinions

	
 

	
65


	
 

	
 

	
23.10

	
Other

	
 

	
65


	
 

	
 

	
23.11

	
Approval
 of Projects to be Added to the Primary Projects

	
 

	
65


	
24.

	
Default;
 Remedies

	
 

	
65


	
 

	
 

	
24.1

	
Events
 of Default

	
 

	
65


	
 

	
 

	
24.2

	
Remedies

	
 

	
68


	
 

	
 

	
24.3

	
Sale
 or Other Disposition of Collateral

	
 

	
69


	
 

	
 

	
24.4

	
Application
 of Proceeds

	
 

	
70


	
 

	
 

	
24.5

	
Actions
 with Respect to Timeshare Loans

	
 

	
70





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Page


	
 

	
 

	
 

	
 

	
 

	



	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
 

	
24.6

	
Retention of Collateral

	
 

	
71


	
 

	
 

	
24.7

	
Performance
 by Lender

	
 

	
71


	
 

	
 

	
24.8

	
No Liability of Lender

	
 

	
71


	
 

	
 

	
24.9

	
Right
 to Defend Action Affecting Collateral

	
 

	
72


	
 

	
 

	
24.10

	
Delegation of Duties and
 Rights

	
 

	
72


	
 

	
 

	
24.11

	
Condemnation
 or Litigation

	
 

	
72


	
 

	
 

	
24.12

	
Set-Off

	
 

	
72


	
 

	
 

	
24.13

	
Waiver
 of Right of First Refusal

	
 

	
72


	
25.

	
Miscellaneous

	
 

	
73


	
 

	
 

	
25.1

	
Notices

	
 

	
73


	
 

	
 

	
25.2

	
Borrower’s
 Representative

	
 

	
74


	
 

	
 

	
25.3

	
Binding
 Effect; Assignment

	
 

	
74


	
 

	
 

	
25.4

	
No
 Waiver

	
 

	
74


	
 

	
 

	
25.5

	
Remedies Cumulative

	
 

	
75


	
 

	
 

	
25.6

	
Costs,
 Fees and Expenses

	
 

	
75


	
 

	
 

	
25.7

	
No Other Agreements

	
 

	
77


	
 

	
 

	
25.8

	
Amendments

	
 

	
77


	
 

	
 

	
25.9

	
Survival
 of Covenants, Agreements, Representations and Warranties

	
 

	
77


	
 

	
 

	
25.10

	
Governing
 Law

	
 

	
77


	
 

	
 

	
25.11

	
Limitation
 of Liability

	
 

	
77


	
 

	
 

	
25.12

	
Submission
 to Jurisdiction

	
 

	
78


	
 

	
 

	
25.13

	
Service
 of Process

	
 

	
78


	
 

	
 

	
25.14

	
Use
 of Name

	
 

	
78


	
 

	
 

	
25.15

	
Headings; References to
 “Exhibits” or to “Sections”

	
 

	
79


	
 

	
 

	
25.16

	
Partial
 Invalidity

	
 

	
79


	
 

	
 

	
25.17

	
Waiver in Legal Actions

	
 

	
79


	
 

	
 

	
25.18

	
Sale;
 Participations; Delegations of Duties

	
 

	
79


	
 

	
 

	
25.19
 

	
Indemnification

	
 

	
80


	
 

	
 

	
25.20

	
Brokers;
 Payment of Commissions

	
 

	
80


	
 

	
 

	
25.21

	
Counterparts;
 Facsimile Signatures

	
 

	
81


	
 

	
 

	
25.22

	
Consents,
 Approvals and Discretion

	
 

	
81


	
 

	
 

	
25.23

	
Control
 of Association

	
 

	
81


	
 

	
 

	
25.24

	
No Joint Venture

	
 

	
81


	
 

	
 

	
25.25

	
All Powers Coupled With
 Interest

	
 

	
81


	
 

	
 

	
25.26

	
Time of the Essence

	
 

	
81


	
 

	
 

	
25.27

	
No Third Party
 Beneficiaries

	
 

	
82


	
 

	
 

	
25.28

	
Directly
 or Indirectly

	
 

	
82


	
 

	
 

	
25.29

	
Dealing With Multiple
 Borrowers

	
 

	
82


	
 

	
 

	
25.30

	
Limitation
 on Damages

	
 

	
82


	
 

	
 

	
25.31

	
Confidentiality

	
 

	
82


	
 

	
 

	
25.32

	
Commercial
 Transaction

	
 

	
82


	
 

	
 

	
25.33

	
Waiver
 of Right to Trial by Jury

	
 

	
83


	
 

	
 

	
25.34

	
USA
 Patriot Act Notice

	
 

	
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vii







RECEIVABLES LOAN AGREEMENT


          THIS RECEIVABLES
LOAN AGREEMENT (the “Agreement”) is made effective as of August 27, 2008 by and between LIBERTY BANK, a
Connecticut non-stock
mutual savings bank (“Lender”)
and BLUEGREEN CORPORATION, a
Massachusetts corporation (“Borrower”).


          NOW,
THEREFORE, intending to be legally
bound hereby, the parties agree as follows:


                    1.          Definitions
and Construction.


                                  1.1          Definitions.
When used in this Agreement,
the following terms shall have
the following meanings (such meanings to be applicable equally both to the
singular and plural terms defined):


                    Advance
means an advance of the
proceeds of the Receivables Loan by Lender to or on behalf of Borrower in
accordance with the terms of this Agreement.


                    Affiliate means
any Person: (a) which directly or indirectly controls, or is controlled
by, or is under common control with such Person; (b) which directly or
indirectly beneficially owns or holds five
percent (5%) or more of the voting stock of such Person; or (c) for which five percent (5%) or more of the voting
stock of which is directly or indirectly beneficially owned or held by such Person; provided, however,
that under no circumstances shall Borrower
be deemed an Affiliate of any 5% or greater shareholder of Borrower or any
Affiliate of such shareholder who is not a Direct Affiliate (as defined herein)
of Borrower, nor shall any such
shareholder be deemed to be an Affiliate of Borrower. 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. For purposes
of this definition, any entity included in the same GAAP consolidated financial
statements as Borrower shall be an Affiliate of Borrower (a “Direct Affiliate”).


                 
  Amenities means
the recreational, access and utility
facilities to be included as part of
or to benefit a Project, as such amenities may be further described in the
applicable Declaration and/or Public Report for such Project.


            
      Applicable
Usury Law means
the usury law applicable pursuant to the terms of Section 25.10 or such other usury law which is applicable if the law
chosen by the
parties is not applicable.


             
     Assessments means
the maintenance assessments and special assessments made against each Timeshare Interest and the Owner thereof
pursuant to the provisions of the Declaration for the applicable
Project.


             
      Assignment shall
have the meaning set forth in Section 6.2.


            
      Association means
each non-profit corporation or entity or
cooperative association under
applicable state or other law which is responsible for the management and







maintenance
of a Project pursuant to the terms of a related Declaration and/or other
applicable Governing Documents.


              
       Bluegreen
Owner Agreement shall have the meaning
set forth in the Trust Agreement.


            
         Borrower
means Bluegreen
Corporation, a Massachusetts corporation, its successors and assigns.


             
        Business
Day means every day on which Lender’s and
Borrower’s offices in the states of Connecticut and Florida, respectively, are
open to the public for carrying on substantially all its business functions.


                
     Change
of Control means the occurrence of any of the
following events: (a) a change in ownership or control of Borrower effected
through a transaction or series of transactions whereby any Person or group of
Persons who are Affiliates directly or indirectly acquires beneficial ownership
(within the meaning of Rule 13d-3 under the Securities and Exchange Act of
1934) of securities of Borrower possessing more than fifty percent (50%) of the
total combined voting power of Borrower’s securities outstanding immediately
after such acquisition, whether by means of a sale, merger, consolidation or
otherwise or (b) any direct or indirect acquisition or purchase of over fifty
percent (50%) in fair market value of the consolidated assets of Borrower and
its Affiliates other than through the ordinary course of business of Borrower
and its Affiliates; provided, however, that a Change of Control
shall not be deemed to occur upon (x) a change in ownership or control of
Borrower effected through a transaction or series of transactions whereby
BankAtlantic Bancorp, Inc., BFC Financial Corp., Woodbridge Holdings Corporation
directly or indirectly acquires beneficial ownership (within the meaning of
Rule 13d-3 of the Securities and Exchange Act of 1934) of securities of
Borrower possessing more than fifty percent (50%) of the total combined voting
power of Borrower’s securities outstanding immediately after such acquisition,
whether by means of a sale, merger, consolidation or otherwise, or (y) any
direct or indirect acquisition or purchase of over fifty percent (50%) in fair
market value of the consolidated assets of Borrower and its Affiliates by
BankAtlantic Bancorp, Inc., BFC Financial Corp., Woodbridge Holdings
Corporation.


           
          Change
of Control Fee has the meaning set
forth in Section 4.5.


            
         Closing
means the closing of the
transactions contemplated under this Agreement on the Closing Date.


                     Closing
Date means the effective date
of this Agreement, which is as of August 27, 2008.


               
     Closing
Date Indebtedness has
the meaning set forth in Section 7.23.


            
        Collateral has
the meaning set forth in Section 6.1.


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                    Condominium
Act means the applicable state statute in the state in
which a Project is located which governs the creation and regulation of
condominiums in such state, as it may be amended.


                    Consumer
Documents means the following documents used by Borrower in connection
with the credit sale of Timeshare Interests:


                    (a)          Credit
Application;


                    (b)          Evidence
of FICO Score (to the extent required under Section 21.3);


                    (c)          Purchase
Agreement (with Right of Rescission Notice);


                    (d)          Deed;


                    (e)          Mortgage;


                    (f)          Note;


                    (g)          Disclosure
Statement;


                    (h)          Owner
Confirmation Interview (Acknowledgment of
Representations);


                    (i)          Receipt
for Timeshare Documents;


                    (j)          Service
Disclosure Statement;


                    (k)          Settlement
Statement (HUD-1);


                    (l)          Good
Faith Estimate of Settlement Charges;


                    (m)       Privacy
Notice; and


                    (n)        Certificate
of Purchase of Owner Beneficiary Rights.


                    A
sample form of each of the Consumer Documents
from the jurisdictions representative of each Primary Project is
attached hereto as part of Exhibit A.


                    Custodial
Agreement shall have
the meaning set forth in Section 6.5.


                    Custodian
shall have the
meaning set forth in Section 6.5.


                    Debt
means, for any Person,
without duplication, the sum of the following:


                    (a)          indebtedness
for borrowed money;


                    (b)          obligations
evidenced by bonds, debentures, notes or other similar instruments;


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                    (c)          obligations
as lessee under leases which have been,
in accordance with GAAP, recorded as capital leases;


                    (d)          obligations
of such Person to purchase securities (or other property) which arise out of or in connection with the sale of the
same or substantially similar securities or property;


                    (e)          indebtedness
or obligations of others secured by a
lien on any asset of such Person, whether or not such indebtedness or
obligations are assumed by such Person (to the extent of the value of the
asset);


                    (f)          obligations
under direct or indirect guaranties
in respect of, and obligations
(contingent or otherwise) to purchase or otherwise acquire, or otherwise to
assure a creditor against loss in respect of, indebtedness or
obligations of others of the kinds referred to in clauses (a) through (e)
above; and


                    (g)          liabilities
in respect to unfunded vested benefits
under plans covered by Title IV of
ERISA.


                    Notwithstanding
the foregoing, with respect to Borrower, the term “Debt” shall exclude recorded
liabilities for non-recourse sales of timeshare notes receivable and such Debt,
if any, as may be subordinated pursuant to the terms of this Agreement or the
other Loan Documents.


                    Debtor
Relief Laws means all applicable liquidation, conservatorship,
bankruptcy, moratorium,
rearrangement, insolvency, reorganization or similar law, proceeding or device
providing for the relief of debtors from time to time in effect and generally affecting
the rights of creditors.


                    Declarations
means, with respect to each Project, the
condominium declaration or similar instrument related thereto pursuant to which
such Project is encumbered and the property regime established thereat is created as all of the foregoing may be
lawfully amended or supplemented from time to time.


                    Deed means
the writing evidencing title in the Trustee on behalf
of the Owner Beneficiaries referred to in,
and subject to the other provisions of, the Trust Agreement, with respect
to Timeshare Interests relating to Timeshare Loans.


                    Default
Rate has the meaning
set forth in Section 3.2.


                    Delinquent
Loan means any Timeshare Loan (a) with respect to which
any payment is, at any time, more than fifty-nine (59) days past due
(computed without reference to any notice or
grace period) or (b) which does not meet the criteria of a Qualified Timeshare Loan.


                    Demand
Balancing Standard has the meaning ascribed to it in the Trust Agreement.


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                    Disclosure
Statement means
the truth-in-1ending disclosures given by Borrower or its
Affiliates to a Purchaser in connection with the credit purchase of one or more
Timeshare Interests.


                    Division
means the
applicable state regulatory agency, department or division in the
state in which a Project is located, which has the power and authority to
regulate timeshare projects in such state.


                    Environmental
Agreement means
that certain Environmental Agreement of even date
herewith between Borrower and Lender as amended, restated, extended or
supplemented from time to time, and any new Environmental Agreement
executed in its place.


                    ERISA
has the meaning
set forth in Section 7.16.


                    ERISA
Affiliates has
the meaning set forth in Section 7.16.


                    Event
of Default means
any Event of Default described in Section
24.1.


              
      FICO
Score means a credit risk score known as a “FICO® Score”
and determined by the Fair Isaac
Company system implemented by Experian or a successor acceptable to Lender, in its reasonable
discretion, for a consumer borrower through the analysis of individual credit files. In the event that such
credit risk scoring program ceases to exist, Lender and Borrower may
select a successor credit risk scoring program as mutually agreed.


                    In the
event that a Purchaser consists of more than
one (1) individual (e.g. husband and
wife) (a “Purchaser Group”), with
respect to Receivables Loan Advances made from the period commencing on the Closing Date through and including
March 31, 2009, the FICO Score for a Purchaser shall be based on either the
Primary Purchaser in such Purchaser Group
or the simple average of the FICO Scores for all individuals who have a FICO
Score in such Purchaser Group. For such Receivables Loan Advances, a
Purchaser shall be considered to have no FICO Score if all individuals in such
Purchaser Group have no FICO Score.


                    With
respect to Receivables Loan Advances made
after March 31, 2009, the FICO Score
for a Purchaser shall be based on the simple average of the FICO Scores for all
individuals who have a FICO Score in
such Purchaser Group. For such Receivables Loan Advances, a Purchaser shall be considered to have no FICO Score if all
individuals in such Purchaser Group have no FICO Score.


                    GAAP
means generally accepted accounting principles in
the United States, applied on a
consistent basis, as described in Opinions of the Accounting Principles Board
of the American Institute of Certified
Public Accountants and/or in statements of the Financial Accounting Standards Board which are applicable
in the circumstances as of the date in question.


                    Governing
Documents means the
certificate or articles of incorporation, organization or formation, by-laws, partnership agreement, joint venture
agreement, trust agreement, operating agreement or other organizational
or governing documents of any Person.


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                    Guaranty
means each guaranty, surety agreement, guaranty
and suretyship agreement and/or
other similar agreement executed by a guarantor in favor of Lender pursuant to which
such guarantor agrees to act as a guarantor for the Obligations, and any new
guaranty or similar agreement given in substitution or replacement therefor and
any new guaranty or surety agreement by any other Person with respect to all or
any part of the Obligations.


                    Incipient
Default means any condition
or event which, after notice or lapse of time or both, would constitute
an Event of Default under this Agreement.


                    Legal
Requirements means all
applicable federal, state and local ordinances, laws, regulations, orders, judgments, decrees, determinations and other
legal restrictions governing a Project, Borrower or their business or
operations.


                    Lender means
Liberty Bank, a Connecticut
nonstock mutual savings bank, its successors
and assigns.


                    Liberty
Portfolio Timeshare Loans means
all Timeshare Loans now existing or hereafter arising which have been pledged,
assigned and delivered to Lender pursuant to this Agreement or any Assignment
(and all replacements of such Timeshare Loans which have been pledged, assigned
and delivered to Lender pursuant to Section
11.2).


                    LIBOR
Rate means the
London Interbank Offered Rate (LIBOR) for one-month United States dollar-denominated deposits as displayed in the Bloomberg
Financial Markets system.
The LIBOR Rate for each calendar month will be equal to the one-month LIBOR
rate published on the first Business Day of such calendar month.
Notwithstanding the foregoing, the initial
LIBOR Rate determination date shall be the Closing Date. If such rate is no
longer published or available, Lender
will, in its reasonable discretion, choose a comparable substitute rate
based upon a national index and an applicable interest margin to reflect the
rate of interest accrual otherwise provided under Section 3.1(b).


                    Loan
Account has the
meaning set forth in Section 2.6.


                    Loan
Documents means this Agreement, the Receivables Loan Note,
any Guaranty, any document
evidencing any assignment or security interest described in Section 6.1, the
Subordination Agreements (if any) required under Section 17, the Servicing Agreement, the Lockbox Agreement, the
Custodial Agreement, the
Environmental Agreement, and all documents now or hereafter executed in
connection with the Receivables Loan or securing the Obligations, as such
documents may be amended, restated or modified.


                    Loan
File means, with respect to each of the Timeshare
Loans, all the Consumer Documents relating thereto, each duly executed,
as applicable, plus:


                    (a)          all
guaranties, if any, for the payment of the Timeshare Loans; and


                    (b)          in
the case of a Timeshare Loan made to a
corporation, partnership or other
entity not an individual, evidence that the execution and delivery of the Note
and other Consumer Documents and the related purchase of Timeshare
Interests have been duly authorized by all necessary action of such entity; and


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                    (c)          the
Title Insurance Policy insuring the lien of the Mortgage.


                    Loan
Year means each twelve (12) month period after the
expiration of the Receivables Loan Advance Period, as such Receivables
Loan Advance Period may be extended from
time to time, i.e., the first Loan Year will commence on the date the
Receivables Loan Advance Period expires after all extensions thereof.


                    Lockbox
Agreement shall have the
meaning set forth in Section 6.3.


                    Lockbox
Bank shall
have the meaning set forth in Section 6.3.


                    Management
Agreement means
the agreement between an Association and the Manager
providing for the management of a Project and any new management agreement executed
in its place, each as amended in accordance with the terms of this Agreement.


                    Manager
means the
entity serving as the manager for a Project pursuant to a Management Agreement and any replacement manager
for such Project approved by Lender, in its reasonable discretion. Bluegreen Resorts Management, Inc., Amber
Resort Management, LLC, Ocean Towers
Beach Club Condominium Association, Inc., Dennis Management, Vacation Resorts International, Inc., RAL Resort
Property Management, Inc., Lake Condominium
Owners’ Association, Inc., Gold Crown Management, Inc. and Eastman Management Services, Inc. shall each be deemed by
Lender to be an approved Manager or replacement manager for any Project. In the
event that Lender does not approve a Manager for any Project, then Lender shall have no obligation to make any further
Advances under the Receivables Loan in connection with the applicable
Project.


                    Material
Adverse Change means any
material and adverse change in, or a change which has a material adverse
effect upon, any of:


                    (a)          the
business, properties, operations or condition (financial or otherwise) of Borrower, which, with the giving of notice or the
passage of time, or both, could reasonably be expected to result in either (i) Borrower failing to comply with any of
the financial covenants contained in Section 15 or (ii) Borrower’s inability
to perform its obligations pursuant to the terms of the Loan Documents; or


                    (b)          the
legal or financial ability of Borrower to
perform its obligations under the Loan Documents and to avoid any
Incipient Default or Event of Default; or


                    (c)          the
legality, validity, binding effect or
enforceability against Borrower of any Loan Document in accordance with
its terms.


                    Maximum
Receivables Loan Amount has
the meaning set forth in Section 2.1,
subject to the restrictions set forth in Section 2.2.


                    Mortgage
means a
mortgage or deed of trust naming Borrower as mortgagee or beneficiary, which secures payment of a Note, is
executed, and encumbers the Timeshare Interest purchased by such Purchaser.


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                    Net
Worth means, for
any Person: (a) total assets of such Person, as would be reflected
on a balance sheet prepared on a consolidated basis and in accordance with
GAAP, consistently applied, exclusive of intellectual property, experimental or
organization expenses, franchises, licenses,
permits, and other intangible assets, treasury stock, unamortized underwriters’ debt discount and expenses, and
goodwill, minus (b) total liabilities of such Person, as would be reflected on a balance sheet
prepared on a consolidated basis and in accordance with GAAP
consistently applied.


                    Non-Complying
Consumer Documents has
the meaning set forth in Section 10.


                    Non-Primary
Project means each Project
approved by Lender as of the date of this Agreement as an eligible
Non-Primary Project for financing, which approved Non-Primary Projects are
specified on Schedule 1 attached
to this Agreement as it may be supplemented or replaced from time to time with
Lender’s written approval, including any approved replacements to Schedule 1 pursuant to Section
23.11.



                    Note
means a purchase money note made by a
Purchaser secured by a Mortgage, payable to
the order of Borrower, and delivered by a Purchaser in connection with the
credit purchase of one or more Timeshare Interests. 


                    Notice
to Purchasers shall
have the meaning set forth in Section
6.6(b).


                    Obligations
means all
payment and performance obligations and liabilities of Borrower to Lender of every kind, nature and
description, direct or indirect, absolute or contingent, due or to become due, secured or unsecured, joint, several,
joint and several, now existing or
hereafter arising, contractual or tortious, liquidated or unliquidated,
regardless of how such obligations or
liabilities arise, including without limitation, the obligation of Borrower to pay (a) the principal of, premium, if any, on and
interest on the Receivables Loan; and (b) all fees, costs, expenses,
indemnities, obligations and liabilities of Borrower owing at any time to
Lender under or in respect of this Agreement and each of the other Loan
Documents.


                    Owner
or Owners means the Purchaser or Purchasers of a
Timeshare Interest, the successive
owner or owners of each Timeshare Interest so conveyed, and Borrower or its Affiliates
with respect to Timeshare Interests in a Project not so conveyed.


                    Owner
Beneficiary shall
have the meaning set forth in the Trust Agreement and includes a Purchaser
under a Purchase Agreement who acquires Owner Beneficiary Rights with appurtenant Vacation Points.


                    Owner
Beneficiary Rights shall have
the meaning set forth in the Trust Agreement.


                    Patriot
Act Certificate and
Agreement means the Patriot Act Certificate and Agreement
by and between Borrower and Lender, dated of even date herewith.


                    PBGC
has the meaning
set forth in Section 7.16.


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                    Permitted
Encumbrances means, with respect to a Mortgage, (a) real
estate taxes and assessments not yet due and payable, (b) exceptions to title
which are approved in writing by the Lender
(including such easements, dedications and covenants which Lender consents to
in writing after the date of this
Loan Agreement). In addition, the following shall be deemed to be Permitted Encumbrances: 1) liens for state,
municipal and other local taxes if such taxes shall not at the time be due and payable; 2) liens in
favor of Lender pursuant to this Agreement; 3) materialmen’s, warehouseman’s and mechanic’s and other liens arising by
operation of law in the ordinary
course of business for sums not due; 4) a Purchaser’s interest in a Timeshare
Interest relating to a Timeshare Loan
comprising a portion of the Liberty Portfolio Timeshare Loans whether pursuant to the Trust Agreement or
otherwise; and 5) any Owner Beneficiary Rights. Notwithstanding the foregoing, such Permitted Encumbrances will not affect
or subordinate the first and prior lien of Lender in and to a Qualified
Note which has been encumbered by a Qualified
Mortgage, the lien of which Qualified Mortgage is insured by the applicable
Title Insurance Policy collaterally
assigned to Lender.


                    Permitted
Modifications means an amendment or other modification to
the terms and conditions of a Timeshare
Loan (a) of a Purchaser as a result of the Servicemembers Civil Relief Act, (b)
with respect to a one percent (1%) increase or decrease in the related
Timeshare Loan’s interest rate
related to a Purchaser’s voluntary or involuntary election to commence or cease using an automatic payment option, as
applicable, or (c) in connection with an Upgraded Note Receivable or
Sampler Loan.


                    Person
means an individual, a government or any agency or
subdivision thereof, a corporation,
partnership, trust, unincorporated organization, association, joint stock
company, limited liability company or
other legal entity.


                    Plan
has the meaning set
forth in Section 7.16.


                    Primary
Project means each
Project approved by Lender as of the date of this Agreement as an eligible Primary Project for
financing, which approved Primary Projects are specified on Schedule 1 attached
to this Agreement as it may be supplemented or replaced from time to
time with Lender’s written approval, including any approved replacements to Schedule 1 pursuant to Section
23.11.


                    Primary
Purchaser means the
first Person identified on the LSAMS loan servicing system of Borrower. For purposes of the foregoing sentence,
“LSAMS” means Loan Servicing and
Account Management System.


                    Project
means each timeshare
project or phase thereof approved by Lender as of the date of this Agreement as
an eligible Project for financing, which approved Projects are identified on Schedule
1 attached to this Agreement as it may be supplemented or
replaced from time to time with Lender’s written approval, including any
approved replacements to Schedule 1 pursuant to Section
23.11.


                    Project
Documents means with
respect to any Project, any and all documents evidencing or relating to the creation and sale of Timeshare Interests,
the applicable


9






Declarations, the applicable Governing Documents of
the Associations, any rules and regulations of the Associations, and the
Management Agreements.


                    Public
Records means the
applicable recording or filing office in the jurisdiction in which a Project is located which is the legally
required office for the recording of Deeds, Mortgages, Declarations and other documents affecting title to real
estate in such jurisdiction.


                    Public
Report means the approved public report, permit or public
offering statement for the Vacation
Club or a Project and the approvals or registrations for such Vacation Club or
Project, in the jurisdiction in which Timeshare Interests in the Vacation Club
are offered for sale or in which
such Project is located and in each other jurisdiction in which sales of the
Vacation Club or Timeshare Interests are made or such Vacation Club or Project
is otherwise required to be registered.


                    Purchase
Agreement means the form of Bluegreen Owner Agreement.


                    Purchaser
means a bona fide third-party purchaser for value
(whether one or more Persons) who has
purchased one or more Timeshare Interests from Borrower or its Affiliates.


                    Qualified
Mortgage means a
Mortgage which may be subject to a Permitted Encumbrance, securing the payment of a Qualified Note which has been or
may be assigned of record to Lender.


                    Qualified
Note means a Note
executed by a Purchaser or Purchasers, payable to the order of Borrower in connection with a
Qualified Sale, which has been assigned and endorsed over to Lender with recourse, with respect to which all of the
requirements for a Qualified
Timeshare Loan are true.


                    Qualified
Sale means a credit
sale of a Timeshare Interest to a Purchaser, which is made by Borrower or its
Affiliates in the ordinary course of its business and is consummated in compliance with all applicable Legal
Requirements and in connection with which (other than in the case of an equity trade or conversion under
a Sampler Program Agreement) the Purchaser pays a cash down payment equal to at least ten percent (10%) of the
Sales Price, which cash down payment
may, in the case of an Upgraded Note Receivable or conversion under a Sampler Program Agreement, be represented in part or in
whole by the principal payments and down payment made on, as applicable, such original Qualified Note or the
related Sampler Loan since its date
of origination.


                    Qualified
Timeshare Loan means each Timeshare Loan made by Borrower
to a Purchaser or Purchasers in connection
with a Qualified Sale which is evidenced by a Qualified Note, secured by a Qualified Mortgage and which
meets the following criteria:


                    (a)          The
Timeshare Loan is evidenced by a Qualified Note, Qualified Mortgage, Purchase Agreement and such other
Consumer Documents which have been, as applicable,
executed in connection with the credit purchase and sale of a Timeshare
Interest;


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                    (b)         The
Timeshare Loan has an original maturity date
of 120 months or less, payable in equal monthly installments of
principal and interest (subject to the exception provided in Section 2.2(e)(i)), with
the first installment due and payable not more
than forty-five (45) days after the
date on which Lender has first advanced funds based upon the collateral
assignment of such Timeshare Loan;


                    (c)          A
cash down payment has been received from the
Purchaser in an amount equal to at
least 10% of the Sales Price (not including closing costs, broker’s
commissions, or any charge for
interest and prior to any discounts) which cash down payment may, in the case
of an Upgraded Note Receivable or
conversion under a Sampler Program Agreement, be represented in part or in whole by the principal payments and down
payment made on, as applicable, such original Qualified Note or the
related Sampler Loan since its date of origination;


                    (d)         The
Timeshare Loan is not a Delinquent Loan;


                    (e)          The
Timeshare Loan is not more than thirty (30)
days past due at the time of the initial Advance against such Timeshare Loan;


                    (f)          There
has been no default by the Purchaser;


                    (g)          Other
than with respect to the effect of the
application of the Service Member’s
Civil Relief Act on Timeshare Loans in the Liberty Portfolio Timeshare Loans,
the annual rate of interest applied to the unpaid principal balance of the
applicable Note is at least equal to
a fixed rate of 10% per annum and the weighted average interest rate for all of
the Liberty Portfolio Timeshare Loans
is at least equal to 12% per annum;


                    (h)         The
Purchaser has no claim of any defense, setoff
or counterclaim to the applicable
Timeshare Loan;


                    (i)
The Timeshare Loan
represents the balance of the Sales Price of a Timeshare Interest and
the Purchaser of such Timeshare Interest is not, and no payment of a sum due under the Timeshare Loan has been made by, an
Affiliate, or an officer, director, agent, employee, principal, broker, creditor (or relative thereof) of any other
Person related to or an Affiliate of Borrower;


                    (j)          The
Consumer Documents and all other aspects of
the related transaction comply with
all Legal Requirements;


                    (k)         The
payment to be received is payable in United
States dollars;


                    (l)         Each
Purchase Agreement, Note, Mortgage and
related Consumer Document has been
duly executed, as applicable, by or on behalf of all Persons having a beneficial ownership interest in the Timeshare
Interest;


                    (m)        The
Unit in which the applicable Timeshare Interest
financed by the Timeshare Loan is
situate: (i) has been completed in compliance with all Legal Requirements, is
currently served by all required utilities, is fully furnished and ready for
use; (ii) is covered by a valid permanent certificate of occupancy (or
its equivalent) duly issued; (iii) is subject to the


11






terms of the Declaration for the
applicable Project; and (iv) has been developed to the specifications provided for in the applicable
Purchase Agreement. All furnishings (including appliances) within the Unit have been or will be fully paid for and are
free and clear of any lien or other interest by any third party, except
for any furniture leases which contain non-disturbance provisions acceptable to Lender;


                    (n)          The
Unit in which the applicable Timeshare
Interest financed by the Timeshare
Loan is situate has had all taxes, Assessments, penalties and fees related
thereto paid when due;


                    (o)          Any
and all applicable rescission periods have
expired;


                    (p)          The
Purchaser’s FICO Score shall not be less than
600, subject to the exception provided in Section 2.2(e);


                    (q)          The
weighted average FICO Score for all Liberty
Portfolio Timeshare Loans after this
Timeshare Loan is added as part of the Liberty Portfolio Timeshare Loans (excluding No-FICO Score Timeshare Loans as
provided in Sections 2.2(e)(iii) and (iv)) shall not be less than 650;


                    (r)          Reserved;



                    (s)          The
Purchaser is a resident of the United States
or Canada, subject to the exception
provided in Section 2.2 (e)(ii); 


                    (t)          The
lien of the Mortgage securing the Note is a
perfected first priority purchase
money mortgage which may be assigned of record to Lender (or is being assigned
to Lender in accordance with this
Agreement, as applicable) and is or will be fully insured by a Title Insurance Policy in the amount of the
Timeshare Loan, which policy is endorsed to Lender and its successors and assigns or insured in the
name of Borrower and collaterally assigned to Lender and its successors
and assigns;


                    (u)          All
representations, warranties and covenants
regarding such Timeshare Loans and the Consumer Documents related
thereto and the matters related thereto as set forth in Section 9 and
elsewhere in this Agreement are accurate and Borrower shall have performed all of its obligations with respect thereto;


                    (v)          Lender
has a valid, perfected first priority lien against and security interest in the
Note and the related Consumer Documents (which in the case of the Consumer
Documents may be subject to a Permitted
Encumbrance) and all payments to be made thereunder;


                    (w)         The
total maximum remaining principal balance of
all Timeshare Loans to any one
Purchaser or Affiliates of such Purchaser (and assigned to Lender hereunder)
shall not exceed $75,000 in the
aggregate;


                    (x)          The
payment terms of such Timeshare Loan have not
been amended in any way, including any revisions to the payment
provisions to cure any defaults or delinquencies, except in the case of a Permitted Modification;


12






                     (y)          There
has been no increase to the applicable interest rate payable on the Timeshare
Loan as the result of the termination of any automatic payment option, unless
all disclosures required under Regulation Z
for such increase have been properly given by Borrower or its Affiliates to
Purchaser;


                     (z)          The
Purchaser is not a “blocked person”, as defined in the Patriot Act Certificate and Agreement; and


                     (aa)        The
Unit in which the applicable Timeshare Interest financed by the Timeshare Loan is situate in a Unit comprising
part of a Primary Project, subject to the exception provided in Section 2.2(e)(v).


                    Receivables
Loan means that certain credit facility in the maximum
amount of $75,000,000 to be extended
by Lender to Borrower pursuant to the terms of this Agreement, as such loan may
be increased, decreased, amended, restated or modified, subject to the
limitations set forth in Section 2.2.


                    Receivables
Loan Advance Period means the period of time commencing on the date of this Agreement and ending on August 27,
2010, subject to the extensions as provided in Section 2.12.


                    Receivables
Loan Fee has the meaning set forth in Section 4.1.


                    Receivables
Loan Maturity Date means August 27, 2014, subject to the extensions as provided in Section 5.4.


                    Receivables
Loan Note means
Borrower’s promissory note payable to the order of Lender evidencing Borrower’s obligation to repay Advances under the
Receivables Loan and all interest
thereon.


                    Renewal
Fee has the meaning set forth in Section 4.4.


                    Request
for Receivables Loan Advance means a Request for Advance as described in Section
2.3.


                    Request
for Supplementary Advance means a Request for Supplementary Advance as described in Section 2.5.


                    Sales
Price means the gross
sales price paid by a Purchaser for one or more Timeshare Interests and shall
not include closing costs, broker’s commission or any charge for interest.


                    Sampler
Loan means a loan made to a purchaser by Borrower
pursuant to the terms of a Sampler
Program Agreement.


                    Sampler
Program Agreement means a Bluegreen Vacation Club Sampler Program Agreement, pursuant to which a purchaser
thereunder obtains those certain benefits set forth therein which comprise the “Sampler Membership” and, subject to
the terms and conditions


13







thereof,
has the opportunity to convert such Sampler Membership into full ownership in
the Vacation
Club.


                    Servicer shall
have the meaning set forth in Section 6.4.


                    Servicing
Agreement shall have the
meaning set forth in Section 6.4.


                    Subordination
Agreement means any agreement
subordinating the obligations owed by Borrower to a creditor, to the Obligations owed
by Borrower to Lender as required pursuant to Section
17.


                    Timeshare
Act means the applicable
state statute or other law in the state or other jurisdiction in which a
Project is located which governs the creation and regulation of timeshare
projects in such state, as it may be amended.


                    Timeshare
Approvals means all approvals, registration and licenses
required from governmental
agencies in order to sell Timeshare Interests and offer them for sale, to
operate the Projects as timeshare projects, to make Timeshare Loans and to own,
operate and manage the Projects, including
without limitation, the registrations/consents to sell, the final subdivision
public reports/public offering statements and/or prospectuses and approvals
thereof required to be issued by or
used in the jurisdiction where the applicable Project is located and other jurisdictions
where Timeshare Interests have been offered for sale or sold.


                    Timeshare
Interest means with respect to any Project, (x) an
undivided fee simple ownership interest as a tenant in common or (y) a Resort Interest
(as defined in the Trust Agreement)
that is an ownership interest in real property substantially similar to an
ownership interest described in clause (x) above (including Owner Beneficiary
Rights), in either case with respect to any
Unit in such Project, with a right to use such Unit, or a Unit of such type, generally
for one (1) week or a portion of one (1) week annually or biennially, together
with all appurtenant rights and interests as more particularly described in the
Project Documents.


                    Timeshare
Loan or Timeshare Loans means
the loan or loans by Borrower to a Purchaser, now existing or hereafter
arising, related to the financing of the sale of a Timeshare Interest.


                    Title
Company means a title insurance company selected by
Borrower and approved
by Lender which is authorized and duly licensed to carry on a title insurance
business in the state in which the applicable Project is located. The Title
Companies set forth on Exhibit K attached hereto, as
amended from time to time, shall be deemed by Lender as approved Title Companies.


                    Title
Insurance Policy means a mortgagee’s or
lender’s title insurance policy issued by the Title Company insuring each Mortgage (or
group of Mortgages) assigned to Lender pursuant hereto, endorsed to Lender and its
successors and assigns or insured in the name of Borrower and collaterally assigned to Lender and
its successors and assigns and in the amount of the Note (or group of Notes) secured by such
Mortgage (or group of Mortgages). The form of Title Insurance Policy related to each of the
Primary Projects, together with all endorsements, are attached hereto as Exhibit E.


14







                    Transfer
means, with respect to the Collateral, the
occurrence of any sale, conveyance,
assignment, transfer, alienation, mortgage, conveyance of security interest,
title, encumbrance of other disposition of any kind of the Collateral, or any
other transaction the result of which is,
directly or indirectly, to divest Borrower of any portion of its title to or
interest in such Collateral,
voluntarily or involuntarily, it being the express intention of Borrower and Lender that Borrower is prohibited from granting
to any Person a lien or encumbrance upon such Collateral, regardless of
whether such lien is senior or subordinate to the Lender’s lien; provided that
the Collateral may be subject to Permitted Encumbrances, which shall not be
deemed to be a Transfer.


                    Trust
Agreement means, collectively, that certain Bluegreen
Vacation Club Amended and
Restated Trust Agreement, dated as of May 18, 1994, by and among Bluegreen Vacations Unlimited, Inc., the Trustee, Bluegreen
Resorts Management, Inc. and Bluegreen Vacation Club, Inc., as amended,
restated or otherwise modified from time to time.


                    Trustee
means Vacation Trust, Inc., a Florida corporation, in its
capacity as trustee under the
Trust Agreement, and its permitted successors and assigns.


                    Unit
means any apartment, condominium or cooperative unit,
cabin, lodge, hotel or motel
room, villa, cottage, townhome, lot or other private or commercial structure
which is situated on real or personal
property and designed for occupancy by one or more persons within a
Project, together with all furniture, fixtures and furnishings therein, if
applicable, and together with any and all
interests in common elements appurtenant thereto, as provided in the related Declaration.


                    Upgraded
Note Receivable means a
new Qualified Note made by the Purchaser under
an existing Timeshare Loan (i) who has elected to terminate such Purchaser’s
interest in an existing Timeshare Interest and related Owner Beneficiary Rights
and Vacation Points (if any) in exchange
for purchasing an upgraded Timeshare Interest of higher value than the existing
Timeshare Interest and related Owner
Beneficiary Rights and Vacation Points (if any) and (ii) whereby the
Borrower releases the Purchaser from Purchaser’s obligations in respect of the existing Timeshare Interest and all related Owner
Beneficiary Rights and Vacation Points (if any) in exchange for receiving (in
substantially all cases) the new Qualified Note from the Purchaser secured by the upgraded Timeshare
Interest and related Owner Beneficiary Rights and Vacation Points (if any).


                    Vacation
Club means the Bluegreen
Vacation Club Multi-Site Timeshare Plan created pursuant to the Trust
Agreement.


                    Vacation
Club Management Agreement means
the Amended and Restated Management
Agreement between Bluegreen Resorts Management, Inc. and Vacation Trust, Inc. dated
as of May 18, 1994, as amended.


                    Vacation
Club Manager means Bluegreen Resorts Management, Inc., a
Delaware corporation, in its
capacity as manager of the Vacation Club, and its successors and assigns.


                    Vacation
Points shall have the
meaning set forth in the Trust Agreement.


15







                    Wellington
Financial means New Wellington Financial LLC, doing business
as Wellington
Financial.


                              1.2          Construction.
Unless the context of
this Agreement clearly requires otherwise, references to the plural include the
singular, references to the singular include the plural, the term “including” is not limiting,
and the term “or” has, except where otherwise indicated, the inclusive meaning represented by the
phrase “and/or.” The words “hereof,” “herein,” “hereby,” “hereunder,” and similar
terms
in this Agreement refer to this Agreement as a whole and not to any particular provision of this
Agreement. An Event of Default shall “continue” or be “continuing” until such Event of Default has been
waived in writing by Lender. Section,
subsection, clause, schedule, and exhibit references are to sections,
subsections, clauses, schedules and
exhibits in this Agreement unless otherwise specified. Any reference in this
Agreement or in the Loan Documents to this Agreement, any of the Loan Documents
or any other document or agreement
shall include all alterations, amendments, changes, extensions, modifications, renewals, replacements,
substitutions, supplements, and restatements thereto and thereof, as applicable.


                              1.3          Schedules
and Exhibits. All of the schedules and exhibits attached to this
Agreement, as they may from time to time be amended or restated, shall be deemed incorporated
herein by reference.


                              1.4          Accounting
Principles. Where the character or amount of any asset or liability or
item of income or expense is required to be determined or any consolidation or other accounting
computation is required to be made for the purposes of this Agreement, the same shall be determined
or made in accordance with GAAP consistently applied at the time in effect, to the extent
applicable, except where such principles are inconsistent with the requirements of this
Agreement.


                    2.       The
Receivables Loan.


                              2.1         Loan
Amount. Subject to the other provisions and conditions of this Agreement, Lender
agrees, from time to time during the Receivables Loan Advance Period, to make Advances under the Receivables Loan
to Borrower in amounts equal to the lesser of: (a) ninety percent (90%) of the unpaid principal balance of Qualified
Timeshare Loans included within the
Liberty Portfolio Timeshare Loans assigned to Lender in connection with such requested Advance, or (b) Seventy-Five Million
Dollars ($75,000,000) (the “Maximum Receivables Loan Amount”).


                              2.2        Advances.


                                          (a)          Revolving
Credit. The Advances to be made under this Agreement are part of a revolving credit facility.
To the extent repaid, amounts advanced by Lender to Borrower may be reborrowed, subject to
the conditions set forth in this Agreement. Although the aggregate amount of all Advances made under this Agreement
may exceed the Maximum Receivables Loan
Amount, the outstanding principal balance of such Advances may at no
time exceed the Maximum Receivables Loan Amount.


16







                                          
(b)          Restrictions
on Receivables Loan Advances. Lender shall have no obligation
to make an Advance under the Receivables Loan (i) more often than twice during
any calendar month, (ii) in an amount less than One Hundred Thousand Dollars ($100,000.00), (iii)
pursuant to a Request for Advance received after the expiration of the Receivables Loan Advance
Period, or (iv) after the occurrence of an Incipient Default or an Event of Default.


                                          
(c)          Additional Restrictions on
Receivables Loan Advances. Notwithstanding anything to the contrary contained in this
Section 2, Lender
shall have no obligation to make any Advance (i) under the Receivables Loan in an
amount which would cause the aggregate outstanding balances under such loans to
exceed $75,000,000; (ii) under the Receivables
Loan in an amount which would cause the outstanding principal balance of the Receivables Loan retained by Lender and not
participated to other participating lenders to exceed $50,000,000; or (iii)
under the Receivables Loan which would cause Lender or any participant in the
Receivables Loan to violate or continue to violate any legal lending limit.


                                          
(d)          Additional
Restrictions on Receivables Loan Advances Related
to the Sale of Participation Interests. Lender is seeking to sell
a $25,000,000 participation interest (the “Participation
Interest”) in the Receivables Loan and all Advances to be made under the
Receivables Loan. Notwithstanding anything in this Agreement or elsewhere to the contrary,
Borrower agrees that Lender shall have no obligation to make any Advances which would cause the
aggregate outstanding balance of the Receivables Loan to exceed $50,000,000 unless and
until Lender has sold the Participation Interest on terms acceptable to Lender and executed a participation agreement
in connection therewith.


                                          
(e)          Other Limitations. Advances under the
Receivables Loan shall
also be subject to the following exceptions and limitations:



                                          
               (i)          Notwithstanding
the limitations set forth in subsection (b) of the definition of
Qualified Timeshare Loan, Timeshare Loans which otherwise satisfy the criteria of
a Qualified Timeshare Loan but which have an original term of more than 120 months and not more
than 180 months (“Fifteen Year Timeshare
Loans”) may be considered Qualified Timeshare Loans, provided that,
(A) at the time Lender is making an Advance based upon the assignment of a pool of Qualified Timeshare
Loans, not more than 10% of the balance of the Qualified Timeshare Loans in
such pool may be comprised of such Fifteen Year
Timeshare Loans; and (B) at any time thereafter not more than 10% of the then
outstanding principal balance of all Qualified Timeshare Loans included
in the Liberty Portfolio Timeshare Loans and against which Liberty has made
Advances may be comprised of such Fifteen Year Timeshare Loans. 


                                          
              (ii)          Notwithstanding
the limitations set forth in subsection (s) of the definition of Qualified Timeshare Loan, Timeshare Loans which
otherwise satisfy the criteria of a
Qualified Timeshare Loan but which involve a Purchaser who is not a resident of the United States or Canada (“Non-Resident
Timeshare Loans”) may be
considered Qualified Timeshare Loans, provided that, (A) payment
of such Non-Resident Timeshare Loan must be
made by the Purchaser under an “auto pay” program via a major credit card, Pre-Authorized Checking or ACH payment; (B) at
the
time Lender is making an Advance based


17







upon
the assignment of a pool of Qualified Timeshare Loans, not more that 10% of the
balance of the Qualified Timeshare Loans in such pool may be comprised of such
Non-Resident Timeshare
Loans; and (C) at any time thereafter not more than 10% of the then outstanding
principal balance of all
Qualified Timeshare Loans included in the Liberty Portfolio Timeshare Loans and
against which Lender has made Advances may be comprised of such Non-Resident
Timeshare Loans.


                                          
            (iii)          Notwithstanding
the limitations set forth in subsection (p) of
the definition of Qualified Timeshare Loan, Timeshare Loans which otherwise satisfy the criteria of a Qualified Timeshare Loan
but involve a Purchaser with a FICO Score of less than 600 (“Less Than
600 FICO Score Timeshare Loans”) may be considered Qualified
Timeshare Loans, provided that, (A) at the time Lender is making an
Advance based upon the assignment of a pool of Qualified Timeshare Loans, not
more than 25% of the balance of the Qualified Timeshare Loans in such pool may
be comprised of such Less Than 600 FICO Score Timeshare Loans and No-FICO Score
Timeshare Loans, in the aggregate, and (B) at any time thereafter not more than 25% of the then outstanding principal balance of
all Qualified Timeshare Loans included
in the Liberty Portfolio Timeshare Loans and against which Lender has made Advances may be comprised of Less Than
600 FICO Score Timeshare Loans and No-FICO Score Timeshare Loans, in the
aggregate.


                                          
            (iv)          Notwithstanding
the limitations set forth in subsection (q) of the definition of
Qualified Timeshare Loan, Timeshare Loans which otherwise satisfy the criteria of
a Qualified Timeshare Loan but involve a Purchaser for whom no FICO Score is
submitted by Borrower (“No-FICO Score
Timeshare Loans”) may be considered Qualified Timeshare Loans, provided that, (A) at the time
of origination of such Timeshare Loan or at the time Lender is making an
Advance based upon the assignment of a pool of Qualified Timeshare Loans, not more than 5% of the balance
of the Qualified Timeshare Loans in such pool may be comprised of such
No-FICO Score Timeshare Loans; and (B) at any time thereafter not more than 5%
of the then outstanding principal balance of all Qualified Timeshare Loans included in the Liberty Portfolio Timeshare Loans
and against which Lender has made Advances may be comprised of such
No-FICO Score Timeshare Loans.


                                          
             (v)         Notwithstanding
the provisions of subsection (aa)
of the definition
of Qualified Timeshare Loan, Timeshare Loans which otherwise satisfy the criteria of a Qualified
Timeshare Loan but which involve the financed sale of a Timeshare Interest in a Unit in a
Non-Primary Project (“Non-Primary Project
Timeshare Loans”) may be considered Qualified Timeshare Loans, provided that, (A) at the time of
origination of such Timeshare Loan or
at the time Lender is making an Advance based upon the assignment of a pool of Qualified Timeshare Loans, not more than
15% of the balance of the Qualified Timeshare
Loans in such pool may be comprised of such Non-Primary Project Timeshare
Loans; and (B) at any time thereafter not more than 15% of the then
outstanding principal balance of all Qualified
Timeshare Loans included in the Liberty Portfolio Timeshare Loans and against
which Lender has made Advances may be comprised of such Non-Primary
Project Timeshare Loans.


                                          
            (vi)          The
minimum weighted
average FICO Score of all Qualified Timeshare Loans included in the Liberty
Portfolio Timeshare Loans (excluding No-FICO Score Timeshare Loans) shall be at least 650.


18







                                                       (vii)          Notwithstanding
the provisions of subsection (g) of the definition of
Qualified Timeshare Loan, the weighted average interest rate for all of the Liberty Portfolio Timeshare Loans shall not
be less than 12% per annum.


                                          
            If the percentage
limitations described in subsections (i)-(vi) above are exceeded, the
excess amount of such Fifteen Year Timeshare Loans, Non-Resident Timeshare
Loans, Less Than 600 FICO Score Timeshare Loans, No-FICO Score Timeshare Loans and Non-Primary Project
Timeshare Loans in the Liberty Portfolio Timeshare Loans, shall not be deemed
to be Qualified Timeshare Loans. In addition, in the event that the weighted
average FICO Score for all of the Liberty Portfolio Timeshare Loans (excluding
No-FICO Score Timeshare Loans) is less than
650, Lender may exclude from the category of Qualified Timeshare Loan any
Timeshare Loans with a FICO Score below 650 as may be necessary to result in compliance with such
weighted average FICO Score requirement. In addition, in the event that the weighted average interest rate for all of
the Liberty Portfolio Timeshare Loans
is less than 12% per annum, Lender may exclude from the category of Qualified Timeshare Loans any Timeshare Loans with
interest rates below 12% per annum as may be necessary to result in
compliance with such 12% per annum minimum weighted average interest rate requirement.


                                          
            In the event that any
Timeshare Loans comprising the Liberty Portfolio Timeshare Loans remain assigned to
Lender for longer than 10 months after the original assignment date, then Borrower will obtain
or, if Borrower fails to do so within thirty (30) days from the date which is 10 months after the original
assignment date, hereby authorizes Lender to
obtain new, current FICO Scores for all Timeshare Loans comprising the Liberty Portfolio Timeshare Loans. Such rescoring shall be
at Borrower’s sole cost and expense. After such rescoring and based upon
the rescored numbers, Borrower must still be in compliance with restrictions
and limitations set forth in this Agreement, including those set forth in this Section 2.2(e).


                                        
(f)           Method
of Funding. The funding of Advances shall be in accordance with such procedures as Lender may
require, including without limitation, disbursement through an escrow agent acceptable to
Lender. In connection with any wire transfer, Borrower will pay Lender’s reasonable costs and expenses for
such wire transfers.


                              2.3     Requests
for Advance. Each Advance (other than a supplementary Advance pursuant to Section 2.5 below) shall be pursuant
to
a Request for Receivables Loan Advance submitted to Lender (or a servicer designated
by Lender) in the form attached hereto as Exhibit
B, with appropriate insertions and duly executed on behalf of
Borrower,
together with all required supporting documentation as described therein. Other
conditions for the funding of Receivables Loan Advances are set forth in
various other sections of this Agreement, including without limitation Sections 6.2, 19, 20, and 21.


                    Notwithstanding
the foregoing, Borrower irrevocably authorizes Lender to advance sums under this Agreement to Lender
to pay fees, costs, expenses and other obligations


19







owed by Borrower under the
Loan Documents without requiring Lender to have received any Request for
Receivables Loan Advance or other related documents.


                              2.4     Limitation
on Amount of Advances. Lender shall have no obligation to make an Advance
which would cause the total of Advances at any one time outstanding to exceed any
limitation set forth in Sections 2.1 or
2.2 or any other limitation set forth in this Agreement.


                              2.5     Supplementary
Advances. In the event that the outstanding principal balance of the
Receivables Loan is less than 90% of the outstanding principal balance of all Qualified
Timeshare Loans included within the Liberty Portfolio Timeshare Loans, then Borrower may request
supplementary Advances in an amount equal to such 90% limitation, provided that (a) Borrower submits to Lender a
Request for Supplementary
Advance in the form attached hereto as Exhibit G, and (b) Lender shall have no
obligation to make such supplementary
Advances (i) more often than once every calendar month, (ii) in an amount less
than $100,000, (iii) after the expiration of the Receivables Loan Advance
Period, (iv) after the occurrence of
an Incipient Default or an Event of Default, (v) which would cause the
aggregate balances of all outstanding Advances to exceed the Maximum
Receivables Loan Amount, or (vi) which would result in a violation of any of
the limitations set forth in Section 2.2.


                              2.6     Loan
Account. Lender will open and maintain on its books a Loan Account (the “Loan Account”) with respect
to Advances
made, repayments, the computation
and payment of interest and fees and the computation and final payment of all
other amounts due and sums paid to Lender under this Agreement and with respect
to the Receivables Loan. Except in the case of manifest error in computation,
the Loan Account will be conclusive and
binding on Borrower as to the amount at any time due to Lender from Borrower
under this Agreement or the Receivables Loan Note as an account stated, except
to the extent that Lender receives a
written notice from Borrower of any specific exceptions of Borrower thereto
within forty-five (45) days after the
date the applicable Loan Account statement has been delivered to Borrower.


                              2.7     Receivables
Loan Note. The obligation of Borrower to repay amounts advanced under the Receivables Loan
and all interest thereon shall be evidenced by the Receivables Loan Note.


                              2.8     Amounts
in Excess of Maximum Receivables Loan Amount.
Lender shall have
the right, but not the obligation, to fund amounts in excess of the Maximum
Receivables Loan Amount from time to time to pay accrued and unpaid interest to
correct or cure any Incipient Default or Event of Default. Borrower agrees that the
correcting or curing by Lender of an Incipient Default or Event of Default shall
not cure the Incipient Default or Event of Default under this Agreement. Such excess
amounts funded shall be deemed evidenced by the Receivables Loan Note to the fullest extent
possible and then by this Agreement, shall bear interest at the Default Rate
and shall also be secured by the Collateral, the Guaranty, and all other
security and collateral for the Receivables Loan. Borrower hereby agrees to
execute additional
notes, Assignments and other additional Loan Documents, and modifications
thereto, promptly
upon request by Lender, in favor of Lender, evidencing and securing amounts
funded in excess of the Maximum
Receivables Loan Amount.


20







                              2.9     Use
of
Proceeds. Advances under the Receivables Loan will be used by
Borrower solely to pay fees, costs and expenses payable by Borrower under the
Loan Documents, and for other
proper working capital and other business purposes of Borrower.


                              2.10   Closing.
The Closing under this
Agreement shall take place effective as of the Closing Date at the offices of White
and Williams LLP in Philadelphia, Pennsylvania,
provided that all conditions for Closing have been completed.


                              2.11   Initial
Request for Advance. In the event the initial Request for Receivables Loan Advance
is not submitted by Borrower to Lender on or before October 27, 2008, Lender at its
option may terminate this Agreement and shall have no further obligation to make any Advance
hereunder.


                              2.12   Extension
of the Receivables Loan Advance Period. Lender, at its sole option, may
elect to extend the initial twenty-four (24) month Receivables Loan Advance Period by two (2)
extension periods of twelve (12) months each; provided, however
that any such
extension shall be on the same material terms and conditions as this Agreement,
as amended or modified from time
to time. In order to exercise each extension option, Lender must give Borrower
written notice of the exercise of such extension at least one hundred twenty (120)
days prior to the date that otherwise would
be the last day of the Receivables Loan Advance Period, as it may have
been previously extended. Such written notice shall be substantially in the
form of Exhibit I attached hereto.
Each extension shall be deemed effective upon Lender giving the required
written notice and without any further action on the part of Borrower.


                              2.13   Allocation
of Pledged Timeshare Loans Among Lenders.
Borrower agrees
that in allocating which Timeshare Loans to assign to Lender under this
Agreement, Borrower shall not adversely select to allocate to Lender otherwise
Qualified Timeshare Loans based
on Project location, in a proportion materially different from Borrower’s other
lenders.


                    3.      Interest
Rate.


                             3.1      Primary
Interest Rate. Until the occurrence of an Event of Default, interest shall accrue and be payable
on the unpaid principal balance of the Receivables Loan as follows:


                                        (a)          From
the Closing Date until, but not
including, the first day of the month following the month during which the
Closing Date occurs, at a yearly rate which is equal to two and one-half percent (2.50%) per annum
in excess of the LIBOR Rate in effect on the Closing Date, provided that, in no
event shall the interest rate on the Receivables Loan be less than 5.75% per
annum.


                                        (b)         On
the first day of the month following the month during which the Closing Date
occurs and on the first day of each month thereafter, the yearly rate at which interest shall be
payable on the unpaid principal balance of the Receivables Loan shall be increased or decreased
to a rate which is equal to two and one-half percent (2.50%) per annum in excess of the LIBOR Rate in effect on such
date, provided that, in no event shall the interest rate on the
Receivables Loan be less than 5.75% per annum.


21







                             3.2       Default
Rate. From and after
the occurrence of an Event of Default,
interest shall accrue and be payable on the unpaid principal balance of the
Receivables Loan Note and all other Obligations under the Loan Documents
at a rate (the “Default Rate”) which
is four (4) percentage points higher than the rate provided in Section 3.1. Any judgment obtained for
sums due under the Receivables Loan Note or other Obligations under the Loan Documents will accrue interest at the Default Rate
until paid. Borrower acknowledges and agrees
that the Default Rate is reasonable in light of the increased risk of
collection after occurrence of an
Event of Default.


                             3.3       Calculation
of Interest. Interest will be calculated on the basis of a year of three hundred sixty (360) days and
charged upon the actual number of days elapsed. Interest will accrue on balances as of the date Lender wires such funds
to Borrower.


                             3.4       Limitation
of Interest to Maximum Lawful Rate. Lender and Borrower intend
to comply at all times with Applicable Usury Laws. In no event will the rate of
interest payable hereunder exceed the
maximum rate of interest permitted to be charged by Applicable Usury Law
(including the applicable choice of law rules) and any interest paid in excess of the permitted rate will be refunded to
Borrower. Such refund may be made by application
of the excessive amount of interest paid against any outstanding Obligations,
applied in such order as Lender may determine. If the excessive amount
of interest paid exceeds the outstanding Obligations, the portion exceeding the
outstanding Obligations will be refunded by Lender.
Any such crediting or refunding will not cure or waive any Event of Default.
Borrower agrees that in determining
whether or not any interest payable hereunder exceeds the highest rate permitted
by Applicable Usury Law, any non-principal payment, including, without
limitation, prepayment fees and late
charges, will be deemed to the extent permitted by law to be an expense, fee, premium or penalty rather than
interest.


                    All
sums paid or agreed to be paid to Lender for the use, forbearance or detention of the indebtedness incurred by Borrower
hereunder shall, to the extent permitted by applicable law, be amortized, prorated, allocated and spread
throughout the term of such indebtedness until payment in full, so that the rate or amount of interest on account of
such indebtedness does not exceed the
usury ceiling from time to time in effect and applicable to the Receivables
Loan.


                   4.       Fees.


                            4.1       Receivables
Loan Fee. Borrower agrees to pay to Lender a Receivables Loan fee equal to $750,000 (the “Receivables Loan
Fee”) which is due and payable on August 28, 2008. This Receivables Loan
Fee is fully earned by Lender and shall not be refundable in whole or in
part, notwithstanding that the full Maximum Receivables Loan Amount is not advanced. Lender is irrevocably
authorized to advance the sums necessary to pay such Receivables Loan
Fee to itself from the proceeds of any Advance under the Receivables Loan or as
an Advance under the Receivables Loan without any further Request for Advance form from Borrower.


                   Notwithstanding
the foregoing, in the event that less than $75,000,000 is committed to Borrower
pursuant to Section 2.2(c) or (d)
or due to a default by a participant and Lender has not replaced such
participant in a timely manner, then a portion of the Receivables Loan Fee


22









shall be refunded to Borrower in a pro rata amount, taking into
account
the decrease in the committed amount and the number of months elapsed in the
Receivables Loan Advance Period. For
example, if a participant holding a participation interest in the amount of
$5,000,000 defaults under its participation agreement with Lender
eighteen (18) months after the Closing Date, then the pro rata amount of the
Receivables Loan Fee to be refunded to Borrower would be equal to:
$5,000,000/$75,000,000 * 6 months/24 months * $750,000 = $12,500.



                              4.2          Late
Charge. In
the event that any payment required under the Receivables Loan is not received by Lender within ten (10) Business Days
after the due date, Borrower agrees
to pay a late charge equal to three percent (3%) of the amount due and payable to
defray the expenses incident to handling such delinquent payments, and to
compensate Lender for the harm and damages
related to such late payments. Borrower hereby acknowledges and agrees
that such late charges are reasonable in light of the anticipated and the
actual harm caused by the late payments; the
difficulties of proof of loss, harm and damages; and the inconvenience and
non-feasibility of Lender otherwise obtaining an adequate remedy. Acceptance of
such late charge will not constitute
a waiver of the default with respect to the overdue installment, and will not prevent the Lender from exercising any of the
other rights and remedies available under the Loan Documents. 



                              4.3          Non-Utilization
Fee.
Subject to Section 5.7 below, on the first anniversary of the date of this Agreement and on each
anniversary date thereafter during the Receivables Loan Advance Period,
Borrower agrees to pay to Lender a non-utilization fee equal to .25% per annum
of the difference between (a) Fifty Million Dollars ($50,000,000), and (b) the average outstanding monthly principal balance of
the Receivables Loan during the immediately preceding twelve (12) month period.
Such non-utilization fee shall be payable on or before the 15th day following the anniversary
date of this Agreement during the Receivables Loan Advance Period. Lender is irrevocably authorized to
advance the sums necessary to pay such fee to itself from the proceeds of any Advance under the
Receivables Loan or as an Advance under the Receivables Loan without any
further Request for Advance form from Borrower. If the average monthly
outstanding principal balance of the Receivables Loan was equal to or greater
than Fifty Million Dollars ($50,000,000)
during such twelve (12) month period, then such fee shall not be due. 



                              4.4          Renewal
Fee. Subject to Section
5.7 below, in the event that Lender exercises any one or more options under Section 2.12 to extend the
Receivables
Loan Advance Period, Borrower agrees
to pay to Lender a renewal fee (“Renewal Fee”)
equal to .25% of the Maximum
Receivables Loan Amount ($187,000) for each extension option exercised by Lender. The Renewal Fee for the first
extension option (if exercised) shall be due and payable in full on the second
anniversary date of this Agreement. The Renewal Fee for the second
extension option (if exercised) shall be due and payable in full on the third
anniversary date of this Agreement. Lender
is irrevocably authorized to advance the sums necessary to pay such fees
to itself from the proceeds of any Advance under the Receivables Loan. 



                              4.5          Change
of Control Fee. In the event that a Change of Control occurs as of or at any time prior to the second
anniversary date of this Agreement, Borrower agrees to pay to Lender an amount equal to the greater of (a) $1,000,000
(the “Change of Control Fee”) or (b) the prepayment fee that would otherwise
be due and payable to Lender 


23







pursuant to Section 5.6
below. In the event that a Change of Control occurs at any time after the second anniversary date of this Agreement,
Borrower agrees to pay to Lender the prepayment fee then due and payable
to Lender pursuant to Section 5.6
below. Such Change of Control Fee or prepayment
fee, as applicable, shall be fully earned and due and payable in full upon the occurrence
of a Change of Control and shall not be refundable in whole or in part.


                    5.       Payments.


                              5.1          Collections.
(a) All payments
(principal, interest and fees) made on
account of the Liberty Portfolio Timeshare Loans shall be paid to Lender via
wire transfer once each Business Day
pursuant to the Lockbox Agreement. Prior to the occurrence of an Event of Default, all such amounts received by
Lender shall be applied twice a month by Lender, on the first (1st) and fifteenth (15th) day of the
month (i) first to the payment of any fees, costs, expenses, charges and indemnification obligations
payable by Borrower under the Loan Documents, including without
limitation those payable under Section
25.6 and Section 25.19,
or past due amounts owing by Borrower to
Lender in connection with the Receivables Loan, (ii) second,
to interest accrued on the unpaid principal balance of the Receivables Loan
through the preceding Business Day,
(iii) third, to the principal balance of the Receivables Loan, and (iv) finally, to all other unpaid Obligations.
Upon the occurrence of any Event of
Default, all payments on the Liberty Portfolio Timeshare Loans may be applied
by Lender towards the repayment of the Obligations in such order as
Lender may elect.


                           
                       (b)
In the event that the (collections
with respect to the Liberty Portfolio
Timeshare Loans) received by Lender include payments for items other than principal and interest payable under the Notes
assigned to Lender (e.g. tax and insurance impounds, maintenance and other Assessment payments, late charges, “NSF”
or returned check charges, misdirected payments or deposits, etc.),
Lender shall remit such other payments back to Borrower provided that (i) no
Event of Default or Incipient Default exists, (ii) Borrower requests in writing
that Lender remit such other payments back to Borrower, (iii) Borrower
specifically identifies (inclusive of the
amount of) such other payments, (iv) Borrower provides Lender with back-up
to support the claim that such payments should not be part of the proceeds of
Collateral, and (v) if such amount is actually remitted to Borrower, then
Lender may adjust the Receivables Loan balance to give effect to such remitted
amounts to Borrower.


                           
                       (c)
Whether or not the collections on account of the Liberty Portfolio Timeshare Loans or the proceeds of the
Collateral shall be sufficient for that purpose, Borrower shall pay when
due all payments of principal, interest, and other amounts required to be made
pursuant to any of the Loan Documents. Borrower’s obligation to make the
payments required by the terms of the Loan Documents is absolute and
unconditional.


                              5.2          Additional
Mandatory Payments. Notwithstanding the foregoing, if at any time the aggregate outstanding principal amount of
the Receivables Loan outstanding is
greater than (a) ninety percent (90%) multiplied by the remaining principal payments due under Qualified Timeshare Loans
comprising the Liberty Portfolio Timeshare Loans, or (b) any other restriction or limitation set forth in this
Agreement, including without


24







limitation, those set forth in Section 2.2, then
within ten (10) days
after notice to Borrower, Borrower agrees to either (i) prepay an
amount equal to such difference together with accrued interest thereon, (ii) pledge additional Qualified Timeshare Loans as
part of the Liberty Portfolio Timeshare
Loans in an amount sufficient to cure the deficiency, or (iii) prepay, in part,
and pledge additional Qualified Timeshare Loans, in part, in a total
amount sufficient to cure the deficiency. For purposes of calculating required
payments under this section, any Delinquent Loans
or Timeshare Loans described in Sections
11.1(a), (b), (c) and (d) shall not be deemed to be Qualified
Timeshare Loans.


                              5.3          Minimum
Payments.  In
the event that the amounts received by Lender
pursuant to the provisions of Section 5.1
are insufficient to pay the accrued interest on the unpaid principal
balance of the Receivables Loan for any calendar month, then and in that event,
Borrower agrees to pay to Lender the unpaid accrued interest for such month
within five (5) Business Days after notice from Lender.


                              5.4          Final
Payment Date.  If not sooner paid, Borrower agrees to pay to
Lender all amounts owing by Borrower to Lender on account of the Receivables
Loan and all other Obligations owing by Borrower to Lender pursuant to
this Agreement on the Receivables Loan Maturity Date. In the event that Lender exercises one or more of the extension
options for the Receivables Loan Advance
Period under Section 2.12, the Receivable Loan Maturity Date shall automatically also be extended by an
additional twelve (12) month period for each extension option. If the first
extension option is exercised, the Receivables Loan Maturity Date shall be August 27, 2015.  If the second extension option is
exercised, the Receivables
Loan Maturity Date shall be August 27, 2016.


                              5.5          Reinstatement
of
Obligations.  Borrower agrees that, to the extent any
payment or payments are made on any Obligations and such payment or payments,
or any part thereof, are subsequently invalidated, declared to be fraudulent or
preferential, set aside or are required to
be repaid to a trustee, receiver, or any other Person under any Debtor Relief Laws,
state or federal law, common law or equitable cause, then to the extent of such
payment or payments, the Obligations or any
part thereof hereunder intended to be satisfied shall be revived and
continued in full force and effect as if said payment or payments had not been
made.


                              5.6          Prepayments.
Borrower may not prepay any of the principal
balance of the Receivables Loan during the Receivables Loan Advance Period, as
it may be extended.  After the end of the Receivables Loan
Advance Period, as it may be extended, Borrower
may prepay all or any part of the principal balance of the Receivables Loan
following delivery of not less than thirty (30) days’ prior written
notice to Lender and upon payment of the applicable fee set forth below.  Any prepayment shall not relieve Borrower
of its obligation to make all regularly
scheduled payments hereunder.  The
following prepayment fees on the Receivables Loan shall be payable:


                                             (a)          Each
prepayment made in the first Loan Year shall
be accompanied by a prepayment fee equal to 3% of the principal amount
prepaid;


                                             (b)          Each
prepayment made in the second Loan Year shall
be accompanied by a prepayment fee equal to 2% of the principal amount
prepaid;


25







                                            (c)          Each
prepayment made in the third Loan Year shall
be accompanied by a prepayment fee equal to 1% of the principal amount
prepaid; and


                                            (d)          Any
prepayment made after the third Loan Year
shall not require any prepayment
fee.


          In
the event that Lender voluntarily agrees to accept a prepayment prior to the
end of the Receivables Loan Advance Period, as it may be
extended, or is compelled to accept a prepayment prior to the end of the
Receivables Loan Advance Period, as it may be extended, Borrower agrees to pay
to Lender a prepayment fee equal to 5% of the amount prepaid.


          In
the event Lender exercises its right to accelerate payments under the Receivables Loan following an Event of Default or otherwise,
any tender of payment of the amount necessary to repay all or part of
the Receivables Loan made thereafter at any time by Borrower, its successors or
assigns or by anyone on behalf of Borrower shall be deemed to be a voluntary prepayment and in connection therewith
Lender shall be entitled to receive the fee required to be paid under
the foregoing prepayment restrictions.


          Borrower
shall be entitled (and is obligated) to prepay the balance of the Receivables Loan to the extent such prepayment
results from a shortfall in sums received from Purchasers under Liberty Portfolio Timeshare Loans and to the extent
such prepayment results from a formerly Qualified Timeshare Loan no
longer being deemed “Qualified”. Borrower shall not be liable to pay a prepayment fee resulting from payments described
in the immediately preceding sentence, unless Borrower has solicited
accelerated payments from Purchasers.


          Borrower
shall also be entitled to prepay the balance of the Receivables Loan, without any prepayment fee, to the extent such
prepayment results from a Timeshare Loan being removed from the Liberty Portfolio Timeshare Loans due to a refinance of
the Note related thereto resulting from an upgrade by a Purchaser.


          Notwithstanding
anything to the contrary set forth in this Section
5.6, upon the
occurrence of a Change of Control, Borrower shall be obligated to prepay the
balance of the Receivables Loan in
accordance with Section 5.7
below, together with the prepayment fee or Change of Control Fee, as
applicable, pursuant to Section 4.5
above.


          The
prepayment fees shall be presumed to be the amount of damages sustained by Lender as a result of such prepayment and Borrower
agrees that such prepayment fees are reasonable under the circumstances
currently existing. The prepayment fees provided for in this Section shall be
deemed included in the Obligations and shall be secured by the Collateral.


          Notwithstanding
anything herein or elsewhere to the contrary, no prepayment fee shall be
payable in the event that Borrower prepays the Receivable Loan in order to be
able to include the Timeshare Loans within
the Liberty Portfolio Timeshare Loans as part of a securitization transaction or similar conduit
transaction, provided that: (A) Borrower gives Lender at least thirty (30) days prior written
notice for each prepayment; (B) such prepayments do not occur more frequently than twice during any one calendar year;
and (C) such prepayments involve the prepayment of the entire balance of
the Receivables Loan in whole and not in part.


26







                              5.7          Change
of Control Payment.  Upon the occurrence of a Change of Control,
Borrower shall immediately pay to Lender all amounts owing by Borrower to
Lender on account of the Receivables Loan and
all other Obligations owing by Borrower to Lender pursuant to this Agreement, including, without
limitation, the Change of Control Fee or prepayment fee, as applicable, pursuant to Section 4.5 above.
Upon such payment, and without limiting the effect of such
payment, no further non-utilization fee or Renewal Fee, as set forth in Sections 4.3 and 4.4 respectively,
shall be due by Borrower to Lender.


                              5.8          Application
of Payments. Prior to the occurrence of an
Event of Default, all collections received by Lender with respect to the
Liberty Portfolio Timeshare Loans shall be applied to the Obligations as set
forth in Section 5.1. Prior to the occurrence of an Event of Default, all other payments received by Lender
with respect to the Receivables Loan shall be applied to the Obligations
as directed by Borrower, or if no direction is received by Lender, as Lender may elect in its discretion. Upon the occurrence of
any Event of Default,
Lender at its option, may apply any
and all collections and other payments received from Borrower with respect to any of the Collateral to accrued
interest, outstanding principal and other sums due hereunder, under the Loan Documents in such order
and with respect to the Obligations, as Lender in its discretion elects.
To the extent that Borrower fails to pay to Lender any fees, costs, expenses, charges or indemnification obligations
under the Loan Documents, Lender, at its option, may apply all or part of such payments towards such fees,
costs, expenses and indemnification obligations.


                              5.9          Indemnity.
Borrower agrees to indemnify Lender against any loss or expense which Lender sustains or incurs as a
consequence of an Event of Default, including, without limitation, any failure of Borrower to pay when due (at
maturity, by acceleration or otherwise) any principal, interest, fee or
any other amount due under this Agreement or the other Loan Documents, but only to the extent that any such loss or expense did
not arise out of Lender’s gross
negligence or willful misconduct. If Lender sustains or incurs any such loss or
expense which constitutes the failure to pay when due (at maturity, by
acceleration or otherwise) any principal,
interest, fee or any other amount due under this Agreement), it will notify Borrower in writing of the amount determined in
good faith by Lender to be necessary to indemnify it for such loss or expense.
Such amount will be due and payable by Borrower to Lender within five (5) Business Days after
presentation by Lender of a statement setting forth a brief explanation of and its calculation of such
amount, which statement shall be conclusively deemed correct absent manifest error. Any amount payable by Borrower
under this Section will bear interest at the Default Rate from the due
date until paid, both before and after judgment.


                              
5.10          General. The Receivables Loan, all interest thereon and all
other sums payable by Borrower under
the Loan Documents shall be paid in immediately available funds in U.S.
Dollars according to the terms of the Loan Documents.


                  
6.         Security;
Guaranties.


                              6.1          Security.
The Obligations shall be secured by, and Borrower hereby grants to Lender a security interest in
and to, all right, title and interest of the Borrower in the following
(collectively, the “Collateral”):


27







              
                             (a)          All
Liberty Portfolio Timeshare Loans, together
with all Purchase Agreements,
Mortgages, Notes and other Consumer Documents related thereto; all payments due or to become due thereunder in
whatever form, including without limitation cash, checks, notes, drafts
and other instruments for the payment of money; and all books and records,
including all computer records, relating thereto.


              
                              (b)          All
proceeds, property, property
rights, privileges and benefits
arising out of, from the enforcement of, or in connection with, all present and
future Liberty Portfolio Timeshare
Loans and all Purchase Agreements, Mortgages, Notes and other Consumer
Documents related thereto, including without limitation, to the extent
applicable, all property returned by or
reclaimed or repossessed from purchasers thereunder, all rights of foreclosure, termination, dispossession,
repossession, all documents, instruments, contracts, liens and security instruments and guaranties relating
to such Liberty Portfolio Timeshare Loans, Mortgages, Notes and other Consumer Documents, all collateral and other
security securing the obligations of any Person under or relating to such
Liberty Portfolio Timeshare Loans, Mortgages, Notes and other Consumer Documents, including, without
limitation, all Owner Beneficiary
Rights under the Trust Agreement in respect of such Liberty Portfolio Timeshare
Loans and all of the Borrower’s
rights or interest in all other property (personal or other), if any, the
sale of which gave rise to such Liberty Portfolio Timeshare Loans, all rights
and remedies of whatever kind or nature Borrower may hold or acquire for the
purpose of securing or enforcing such Liberty Portfolio Timeshare Loans,
Mortgages, Notes and other Consumer Documents, and all general intangibles relating to or arising out of such Liberty
Portfolio Timeshare Loans, Mortgages, Notes and other Consumer
Documents.


              
                             (c)          All
of Borrower’s accounts receivable, chattel
paper, contract rights, documents,
instruments, pre-authorized
account debit agreements, general intangibles
and choses-in-action, claims and judgments, solely related to all Liberty
Portfolio Timeshare Loans.


              
                             (d)          All
of Borrower’s rights under any Title Insurance Policies covering Mortgages
assigned to Lender in which Borrower now or hereafter has any interest to the
extent related to any Liberty Portfolio Timeshare Loans.


              
                              (e)          Any
and all proceeds of the foregoing.


                                  
         (f)          Any
and all other property now or hereafter serving
as security for the Obligations.


          All
liens and security interests shall be first priority liens and security
interests. Borrower and Lender hereby agree
that this Agreement shall be deemed to be a security agreement under the Uniform Commercial Codes of the
State of Connecticut and the Commonwealth
of Massachusetts. Accordingly, in addition to any other rights and remedies
available to Lender hereunder, Lender shall have all the rights of a secured
party under the Connecticut and Massachusetts Uniform Commercial Codes.


          The
above-described liens and security interests shall not be rendered void by the fact that no Obligations in respect of the
Receivables Loan exist as of any particular date, but


28







shall continue in full force and effect until all Obligations
under
this Agreement and the other Loan Documents pertaining to the Receivables Loan
have been fully and finally paid, performed and satisfied, Lender has no
agreement or commitment outstanding pursuant to which Lender may extend credit
to or on behalf of Borrower and Lender has executed termination statements or releases with respect thereto. IT IS THE EXPRESS
INTENT OF BORROWER THAT ALL OF THE COLLATERAL SHALL
SECURE ALL PRESENT AND FUTURE OBLIGATIONS OF BORROWER TO LENDER UNDER
THIS AGREEMENT.


                              6.2          Endorsement
of Notes; Assignment and Delivery. The original Note evidencing each of the
Timeshare Loans shall be delivered to Lender and shall be endorsed to Lender
with the following signed form of Endorsement:


	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Pay to the
 order of Liberty Bank, with recourse.

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Bluegreen
 Corporation

 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 


 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Name/Title:

 	
  

 	
  

 
	
  

 	
  

 	
 


 	
  

 



                To
the extent that any of such Notes had previously been endorsed by Borrower to another
Person, such Person shall have re-endorsed such Notes back to Borrower.


                Each of the
Timeshare Loans shall be collaterally assigned to Lender by written Assignment
(the “Assignment”), duly executed
on behalf of Borrower in substantially the form attached hereto as Exhibit C, provided that a batch
Assignment shall also be deemed acceptable to
Lender. Each Assignment shall be in a form which is properly recordable in the
applicable real estate records in the state in which the applicable
Project is located.


                Lender
has agreed that it will not record an Assignment in such real estate records for a period of ten (10) months after such
Assignment is executed by Borrower, provided that: (a) each and every
Assignment may be recorded by Lender, at its sole discretion, at any time after the occurrence of an Event of Default or an
Incipient Default, and (b) an Assignment may be recorded prior to the
expiration of such ten (10) month period, if the Legal Requirements for the state in which the applicable Project covered
by the Assignment is located requires that such Assignment be recorded within a period shorter than ten (10) months
after the Assignment is executed in order for such Assignment to be
accepted for recording, valid and enforceable and not subject to challenge.
Borrower shall pay any actual recording or filing fees and any taxes, charges and/or expenses associated therewith upon
ten (10) days’ prior written notice from Lender.


                              6.3          Lockbox
Agreement. All
amounts payable on account of the Liberty
Portfolio Timeshare Loans shall be received by a financial institution or other
entity approved by Lender (“Lockbox
Bank”) and transmitted by Lockbox Bank to Lender or any entity designated by Lender in accordance with
the provisions of an agreement among Borrower, Lender, Servicer and Lockbox
Bank in form and content acceptable to Borrower and Lender (the “Lockbox Agreement”). Bank of America, N.A.
shall be deemed by Lender to be an approved Lockbox Bank. All payments on account of Liberty Portfolio Timeshare
Loans shall be


29







deposited in an account maintained by
Borrower for the benefit of Lender with the Lockbox Bank and shall be transmitted to Lender by wire
transfer by the Lockbox Bank once each Business Day, pursuant to the
Lockbox Agreement. At any time after Lockbox Bank shall fail to keep and
perform its obligations under the Lockbox Agreement to the reasonable
satisfaction of Lender, Borrower shall, upon
the written request of Lender, promptly terminate such agreement in
accordance with the terms of the Lockbox Agreement.


          At
any time after Lockbox Bank shall fail to keep and perform its obligations under the Lockbox Agreement to the satisfaction of
Lender, Borrower shall, upon the written request of Lender, terminate such agreement in accordance with its
terms. If the Lockbox Agreement shall be terminated by Lender, the
Lockbox Bank or, with the consent of Lender, by Borrower, Borrower shall, prior
to the effective date of such termination, enter into a similar arrangement
with another financial institution satisfactory to Lender, or at Lender’s
option make other arrangements satisfactory to Lender, in its sole discretion,
for the collection and transmittal to Lender of payments made on account of
Timeshare Loans then and thereafter assigned to Lender pursuant to this Agreement.


          Borrower
expressly acknowledges and agrees that an action for damages for any breach of the requirements of this Section 6.3
shall not be an adequate
remedy at law. In the event of any such breach, Borrower agrees to the
fullest extent allowed by law that Lender shall be entitled to injunctive relief to restrain such breach and require
compliance with such requirements.


          Borrower
hereby agrees to indemnify and hold Lender harmless from and against any
claims, demands, expenses, costs, damages, liabilities, setoffs, recoupments
and expenses associated with the Lockbox
Agreement regardless of whether or not Lockbox Bank is liable or responsible for such items under the express terms
of the Lockbox Agreement, except to the extent such claims, demands, expenses, costs, damages, liabilities,
setoffs, recoupments and expenses are found in a final non-appealable
judgment by a court of competent jurisdiction to have resulted from the gross negligence or willful misconduct of the
Lender or Lockbox Bank. By way of example, but without limiting any
other possibilities, Borrower shall, subject to the foregoing sentence, indemnify and hold Lender harmless from and against
any claims, demands, expenses, costs,
damages, liabilities, setoffs, recoupments and expenses (including, without limitation,
reasonable attorney’s fees and court costs) both legal and equitable,
associated with the Lockbox Agreement regardless of whether or not Lockbox Bank
may avoid or limit its responsibility by claiming (i) that Lender had a duty to
notify Lockbox Bank of any errors, discrepancies
and/or irregularities under the Lockbox Agreement, (ii) that Lockbox Bank’s liability cannot exceed the service charges
charged in connection with the Lockbox Agreement for the most recent
twelve-month period, and (iii) that Lockbox Bank’s liability does not extend to
special, incidental, indirect or consequential damages.


                              6.4          Servicing
Agreement. The
Liberty Portfolio Timeshare Loans shall be serviced by Borrower (in its
capacity as servicer, and any third party successor servicer, the “Servicer”),
provided that, the terms and conditions of such servicing
shall at all times be acceptable to Lender and Borrower and shall be in
writing in the form of a bi-party servicing agreement
between Borrower and Lender (the “Servicing
Agreement”). At any time after Servicer shall fail to keep and perform its obligations under the
Servicing Agreement to the


30







satisfaction of Lender, Lender may terminate such agreement in
accordance with the terms of such Servicing Agreement and may engage a third
party servicer, including without limitation, Concord Servicing Corporation (“Concord”), to handle the servicing
of the Liberty Portfolio Timeshare Loans pursuant to the provisions of an
agreement among Borrower, Lender and Concord in form substantially
similar to that set forth in Exhibit L
attached hereto.


                              6.5          Custodial
Agreement. The Loan Files related to the Liberty Portfolio Timeshare Loans shall be held for the
benefit of Lender by U.S. Bank National Association or another entity approved by Lender (“Custodian”) pursuant
to the provisions of
an agreement among Lender, Borrower
and Custodian in form and content acceptable to Lender, Custodian and
Borrower (the “Custodial Agreement”). At any time after Custodian shall
fail to keep and perform its obligations under the Custodial Agreement to the
reasonable satisfaction of Lender, Lender may terminate such agreement in
accordance with the terms of such Custodial Agreement.


                              6.6          Notice
to Purchasers.


            
                                (a)          Each
Purchaser with a Liberty Portfolio Timeshare
Loan shall be directed by Borrower, in
writing, to make all payments on account of such Liberty Portfolio
Timeshare Loan (i) by automatic debit to such Purchaser’s bank account, to be
initiated by and to be paid to Lockbox Bank; (ii) by check payable to the order
of Borrower pursuant to the Lockbox Agreement and to mail such checks to the
Lockbox Bank at the address specified in the
Lockbox Agreement; or (iii) by credit card payment for processing through
Borrower’s merchant account with such
payment to be deposited through the Lockbox Bank into Lender’s deposit account.


             
                              (b)          Borrower
shall deliver to Lender at the Closing, a
form of notice to Purchasers advising them of the collateral assignment of their
Liberty Portfolio Timeshare Loan to
Lender and directing that all payments on account of such Purchaser’s Liberty Portfolio Timeshare Loan be made as
directed in Section 6.6(a),
which notice (the “Notice
to Purchasers”) shall be in the
form attached hereto as Exhibit D. Lender shall have the right, at any time
upon the occurrence and during the continuance of an Event of Default, to send an original or a copy of such Notice to
Purchasers to each Purchaser with a Liberty Portfolio Timeshare Loan.


              
                             (c)          In
addition, Borrower hereby grants to Lender a
power of attorney, at Borrower’s
cost, to give notice in writing or otherwise, upon the occurrence and during
the continuance of an Event of Default, in such form or manner as Lender may
deem advisable in its sole discretion,
to each Purchaser with a Liberty Portfolio Timeshare Loan of such assignment with direction to make all
payments on account of such Liberty Portfolio Timeshare Loan in
accordance with such instructions as Lender may deem advisable in its sole discretion. This power of attorney being coupled
with an interest is irrevocable.


              
                            
(d)          Borrower
authorizes Lender and Servicer (but Lender and Servicer shall not be obligated)
to communicate at any time, upon the occurrence and during the continuance of an Event of Default, with any
Purchaser or any other Person primarily or


31









secondarily liable under
a Liberty Portfolio Timeshare Loan with regard to the lien of Lender thereon
and any other matter relating thereto.


                              6.7          Payments
to be Forwarded. If Borrower shall, at any time and for any reason, receive any payment on account of any
Liberty Portfolio
Timeshare Loan, it shall hold such payments in trust for the benefit of
Lender and shall deliver such payment, in the form received, with any necessary endorsements, within two (2)
Business Days after
receipt, to the Lockbox Bank for collection and deposit as required in
the Lockbox Agreement.


                              6.8          Cancellation
and Modifications of Notes. As long as any Timeshare Loan is included in the Liberty
Portfolio Timeshare Loans, Borrower shall not cancel or modify the Note related thereto; provided,
however,
that Borrower may modify the Note in connection with a Permitted
Modification.


                              6.9          Permitted
Contests. Notwithstanding anything in the Loan Documents or otherwise to the contrary, after prior
written notice to
Lender, Borrower at its expense may contest, by appropriate legal or
other proceedings conducted in good faith and with due diligence, the amount or validity of any tax, charge,
assessment,
statute, regulation, or any monetary lien on the Collateral, so long as:
(i) in the case of an unpaid tax, charge, assessment or lien, such proceedings
suspend the collection thereof from Borrower and the Collateral, and shall not
interfere with the payment of any monies due under the Collateral in accordance
with the terms of the Loan Documents; (ii)
none of the Collateral is, in the judgment of Lender, in any imminent
danger of being sold, forfeited or lost; (iii) in the case of a statute or
regulation, neither Borrower nor Lender is in
any danger of any civil or criminal liability for failure to comply therewith; and (iv) Borrower has furnished
such
security, if any, as may be required in the proceedings or as Lender
reasonably requests up to 100% of the amount in controversy.


                  
  7.     Representations
and Warranties. As an
inducement to Lender to advance funds to Borrower, Borrower represents
and warrants to Lender as follows:


                              7.1          Organization;
Power.


                                             (a) 
         Borrower.
Borrower is a
corporation duly formed, validly existing
and in good standing under the laws of the Commonwealth of Massachusetts, duly licensed or qualified and in good
standing as a
foreign corporation under the laws of each jurisdiction in which the character or location of the properties owned
by it or the business transacted by
it requires such licensing or qualification, except where the failure to be so
licensed or qualified would not
reasonably be expected to result in a Material Adverse Change, having full power and lawful authority to enter
into the
Loan Documents, perform its obligations under the Loan Documents and carry on
its business as it is now being conducted or as proposed to be conducted.


                                             (b)          Associations.
Each Association
is a non-profit corporation or
cooperative association duly organized, validly existing and in good standing
under the laws of the state or
jurisdiction in which the applicable Project is located, having full power and lawful
authority to perform its obligations under the applicable related Declaration
and


32







applicable
Management Agreement, and carry on its business as it is now being conducted or
as proposed to be conducted.


                              7.2          Licenses.
Borrower and its Affiliates, and, to the best of Borrower’s
knowledge, the Associations and their respective employees, servants and agents
have and will have all material licenses,
permits, consent, orders, registrations, approvals and other authority
as may be necessary to enable them to own and operate their business, to
perform all services and business which they
have agreed to perform in any state, municipality or other jurisdiction,
to operate the Projects, to sell Timeshare Interests and to make Timeshare
Loans.


                              7.3          Transaction
is Legal and
Enforceable. The execution and delivery of this Agreement and all other Loan Documents
and the performance by Borrower of its
obligations hereunder and thereunder are within the powers and purposes of
Borrower. This Agreement and all other
Loan Documents to which Borrower is a party are valid, legal and binding
upon Borrower, enforceable against Borrower in accordance with their terms.


                              7.4          Due
Authorization; No
Legal Restrictions. The execution and delivery
by Borrower of the Loan Documents, the consummation of the transactions contemplated
by the Loan Documents and the fulfillment and compliance with the respective terms, conditions and provisions of
the Loan
Documents: (a) have been duly authorized by all requisite corporate action of Borrower, (b) will not conflict
with or
result in a breach of, nor constitute
a default (or which would reasonably be expected to, upon the passage of time
or the giving of notice or both, constitute a default) under, any of the
terms, conditions or provisions of any applicable statute, law, rule,
regulation or ordinance or Borrower’s Governing Documents or any indenture, mortgage, loan or credit
agreement,
instrument or other document to which Borrower may be bound or affected, or any
judgment or order of any court or governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign, and (c) will not result in the creation or
imposition of any lien, charge or encumbrance of any nature whatsoever upon any of the property or assets of
Borrower under the terms or provisions of any such agreement or
instrument, except liens in favor of Lender.


                              7.5          No
Breach or Default of
Other Agreements; Compliance with Other Agreements. Neither the execution and delivery of the Loan
Documents on behalf of Borrower nor
the performance by Borrower of the transactions contemplated hereby (a) will
violate any provision of any applicable Legal Requirements, or (b) to the best
of Borrower’s knowledge, will
constitute or with the passage of time or giving of notice will result in the
breach of any term or provision or
constitute a default under or result in the acceleration of any obligation under any agreement or other instrument
to which Borrower is a party, or by which Borrower, or any of its property or
assets are bound, the effect of which would reasonably be expected to result in a Material Adverse Change.
Borrower is not in default under or with respect to any mortgage, lease
or agreement to which it is a party or by which it or any of its properties are bound, the effect of which would
reasonably be expected to result in a Material Adverse Change, and to the best
of Borrower’s knowledge, no event or condition which, after notice or lapse of time or both, would constitute
a default thereunder such that the result thereof would reasonably be
expected to result in a Material Adverse Change, exists. To the best of Borrower’s knowledge, Borrower has
not received any
written notice, from any source, including without limitation, any
mortgagee or lessor, with respect to any claimed default by


33







Borrower
with respect to any such mortgage, lease or agreement, the effect of which
would reasonably be expected to result in a Material Adverse Change.


                              7.6          Litigation.
There are no actions or proceedings pending or to
the best of Borrower’s knowledge,
threatened, against or affecting any Project, the Collateral, Borrower, or its properties, at law or in equity
before any court or before any governmental or regulatory authority or agency,
arbitration board or other tribunal, which would reasonably be expected to result in a Material Adverse Change.
Neither Borrower nor any Affiliate of Borrower
has received any written notice from any court, governmental authority or other
tribunal alleging that Borrower, any
Affiliate of Borrower or any Project has violated in any material respect the Timeshare Act, any of the
rules or regulations thereunder, the Declarations or any other
applicable Legal Requirements, agreements or arrangements, in a manner which
would reasonably be expected to result in a Material Adverse Change.


                              7.7          Taxes.
Borrower is not in default in the payment of any
real property, personal property or
income tax or in the filing of any tax return required to be filed under any tax law (federal, state and local)
applicable to it or its properties. All taxes shown by said returns to
be payable and all interest and penalties, if any, in respect thereof, have
been fully paid when due, except to the
extent that such taxes, assessments, fees and other governmental charges or the failure to pay the same would not
be material to the respective business, properties or assets of Borrower. To the best of Borrower’s
knowledge, no taxing authority has questioned or disputed the accuracy
or completeness of any such tax return. No taxing authority has notified
Borrower of any basis for any such question or dispute or investigation except
as set forth on Schedule
7.7. No tax-related audit is
pending or, to the best of Borrower’s knowledge, threatened with respect to Borrower or any Association
except as set
forth on Schedule 7.7. All
taxes (including sales taxes) related to the operation of the Projects, the
ownership or use of the Projects and
the sale of Timeshare Interests in respect of the Projects, which are due and
payable, have been paid in full,
except for permitted contests under Section
6.9 or which are otherwise being conducted in good faith and for which Borrower has maintained
adequate reserves in accordance with
GAAP. All tax returns and reports required to be filed by Borrower, if any, have
been timely filed, or proper extensions for filing have been obtained. Borrower
has no knowledge of any proposed tax
assessment against Borrower that could be material to its business, properties, assets, operations, condition
(financial or otherwise) or business prospects except as set forth on Schedule 7.7.


                              7.8          Insurance.
All the insurance required by the Declarations
related to Associations managed by
the Vacation Club Manager, the Loan Documents and this Agreement to be obtained has been obtained, is
presently in full force and effect and all premiums thereon have been fully paid when due to date. Each of
Borrower’s certificates evidencing, as applicable, casualty or liability
insurance and in respect to which Lender has been indicated as a loss payee,
additional insured or certificate holder, as applicable, shall provide that the related policy may not be
canceled or
materially changed except upon (i) providing ten (10) days’ prior written notice, with respect to
casualty insurance coverage, and (ii) endeavoring to provide ten (10) days’ prior written notice, with
respect to liability insurance coverage, of intention of non-renewal,
cancellation or material change to Lender and that no act or thing done by
Borrower shall invalidate any policy as against Lender; provided, however,
that Borrower agrees to use commercially
reasonable efforts to require the applicable insurer to provide thirty


34







(30)
days’ prior written notice of cancellation. Lender has been named as an
additional insured, certificate holder or loss payee on such
certificates, as applicable.


                              7.9          Consents.
No consent,
approval, order or authorization of, or registration with, any governmental authority, or any other Person,
which has not been properly obtained
and remains in full force and effect, is required in connection with the valid
execution and delivery of this Agreement or any other Loan Documents by
Borrower, or the performance by Borrower of the transactions
contemplated hereby or thereby.


                              7.10        No
Violation of Law. Neither Borrower nor any Affiliate of Borrower involved in the operations of any of the
Projects is in
violation of any Legal Requirements
to which it is subject, which would reasonably be expected to result in a
Material Adverse Change. Neither
Borrower nor any Affiliate of Borrower has failed to obtain any material license, permit, franchise or other
governmental authorization necessary to the ownership of its property or
to the conduct of its business as the same is presently conducted and as proposed to be conducted, including, but
not
limited to, development and construction of the Projects, marketing and selling Timeshare Interests, the making of
Timeshare Loans and the financing of
the sale of Timeshare Interests, which failure would reasonably be expected to
result in a Material Adverse Change.


                              7.11        Financial
Statements.


                                           
(a)          The audited financial statements of Borrower
for
the fiscal year ended December 31,
2007 and the interim financial statements of Borrower for the fiscal quarter ended March 31, 2008, copies of
which have
been furnished to Lender, have been prepared
on a consolidated basis, are complete and correct and fairly present the
financial condition of Borrower and
its subsidiaries as at such date and the results of the operations of Borrower and its subsidiaries for the
periods
covered by such statements, all in accordance with GAAP.



                                             (b)          The
financial statements of the Associations
managed by the Vacation Club Manager
for the fiscal year ended December 31, 2007, copies of which have been
furnished to Lender, are complete and correct and fairly present the financial
condition of such Associations as at such date and the results of the
operations of such Associations for the period covered by such
statement, all in accordance with GAAP. 


                              7.12        No
Material Adverse Change in Financial
Condition. There
has been no Material Adverse Change in the financial condition of Borrower or
its subsidiaries since March 31, 2008.


                              7.13        Title
to Collateral. The Collateral is and will at all times be owned by Borrower free
and clear of all liens and other encumbrances of any kind, excepting only liens in favor of Lender or Permitted
Encumbrances. There are no liens or encumbrances against any of the Collateral consisting of the Liberty Portfolio
Timeshare Loans, other than liens in
favor of Lender or Permitted Encumbrances.. Borrower will defend its title to the
Collateral against any claims of all Persons other than Lender.


35







                                   7.14          Names,
Addresses and States of Formation. During the past five (5) years, Borrower has not been known by any
names and has not been located at any addresses, other than those set forth on Schedule
7.14. The portions of the Collateral which are tangible property
and have not been delivered to Lender and the books and records pertaining
thereto will at all times be located at the
address for Borrower set forth on Schedule
7.14; or such other location
determined by Borrower after prior notice to Lender and delivery to Lender of
any items requested by Lender to
maintain perfection and priority of Lender’s security interests and access to
such books and records. Schedule 7.14
identifies the chief executive office, principal place of business
and state of formation of Borrower.


                                   7.15          Current
Compliance. Borrower is currently in compliance with all
of the terms and conditions of this Agreement and all other Loan Documents and
no Incipient Default or Event of Default currently exists.


                                   7.16          Pension
Plans. Borrower has no
obligations with respect to any employee
pension benefit plan (“Plan”) (as
such term is defined in the Employee Retirement Income Security Act of 1974, as amended
(“ERISA”)). No events, including, without limitation, any “Reportable
Event” or “Prohibited Transaction” (as those terms are defined under
ERISA), have occurred in connection with any such Plan which might constitute
grounds for the termination of any such Plan by the Pension Benefit
Guaranty Corporation (“PBGC”) or for the appointment of any United States District
Court of a trustee to administer any such Plan. All such Plans meet with the minimum funding standards of Section
302 of
ERISA. Borrower has no existing
liability to the PBGC. Borrower is not subject to or bound to make
contributions to any “multi-employer
plan” as such term is defined in Section 4001 (a)(3) of ERISA.


                    The
present value of the aggregate benefit liabilities under any of the Plans, determined as of the end of such
Plan’s most
recently ended plan year on the basis of the actuarial assumptions specified
for funding purposes in such Plan’s most recent actuarial valuation report, did not exceed the aggregate
current value of the assets of such Plan allocable to such benefit liabilities. The term “benefits
liabilities” has the meaning
specified in Section 4001 of ERISA
and the terms “current value” and “present value” have the meanings specified
in Section 3 of ERISA. Neither Borrower
nor any ERISA Affiliates have incurred withdrawal
liabilities (and are not subject to contingent withdrawal liabilities) under
Section 4201 or 4204 of ERISA. The term “ERISA Affiliates” means any trade or business (whether
or not incorporated) that is treated as a single
employer together with Borrower under Section 414 of the Internal
Revenue Code of 1986, as amended.


                                   7.17        
Use of Proceeds/Margin Stock/Governmental Regulations. None
of the proceeds of the Receivables Loan will be used to purchase or carry any “margin
stock”(as defined under Regulation U of the
Board of Governors of the Federal Reserve System, as in effect from time to
time), and no portion of the proceeds of the Receivables Loan will be extended to others for the purpose of
purchasing or
carrying margin stock. None of the transactions contemplated in this
Agreement (including, without limitation, the use of the proceeds from the
Receivables Loan) will violate or result in the violation of Section 7 of the Securities Exchange Act of 1934, as
amended, or
any regulations issued pursuant thereto, including, without limitation,
Regulations G, T, U and X of the Board of Governors of the Federal Reserve System, 12 C.F.R., Chapter 11.
Borrower is not an investment company as


36







defined
by the Investment Company Act of 1940, as amended, and is not required to
register under such Act. Borrower is
not subject to regulation under the Federal Power Act, the Public Utility Holding Company Act of 1935, the
Interstate Commerce Act, as the same may be amended from time to time, or any federal or state statute or
regulation
limiting its ability to incur Debt.


                                   7.18
       Solvency. Borrower is
solvent. No transfer of property is being made by Borrower and no obligation is being incurred by Borrower in
connection with the transactions contemplated by this Agreement or the
other Loan Documents with the intent to hinder, delay, or defraud either
present or future creditors of Borrower.


                                   7.19          Insurance.
No notice of
cancellation has been received by Borrower
with respect to any insurance policies required under this Agreement and
Borrower is in compliance with all conditions contained in such policies
that pertain to Borrower.


                                   7.20          Tax
Identification
Number.
Borrower’s federal tax
identification number is 03-0300793.


                                   7.21          Purposely Omitted.


                                   7.22          Restrictive Contracts. Borrower is not a
party to
any contract or agreement, or subject to any
lien, charge or restrictions, which materially and adversely affects its ability to comply with the terms of this
Agreement or would reasonably be expected to result in a Material Adverse
Change. Borrower will not be a party to any other contract or agreement which
prohibits its execution of, or compliance with the terms of this Agreement or
the Loan Documents. Borrower has not agreed
or consented to cause or permit in the future (upon the happening of a
contingency or otherwise) any of the Collateral, whether now owned or hereafter
acquired, to be subject to a lien, except the lien in favor of Lender or a
Permitted Encumbrance.


                                   7.23          Closing Date Indebtedness. Schedule
7.23
sets forth the outstanding principal balance of
all indebtedness for borrowed money, repurchase obligations with respect to sold Timeshare Loans and other
liabilities of Borrower (other than accounts payable in the ordinary course) as
of the Closing Date. Such indebtedness, obligations and liabilities are
referred to collectively as “Closing Date
Indebtedness”. Borrower is not in default, in any material respect,
with respect to any of the Closing Date Indebtedness as of the Closing Date.


                                   7.24          Completeness of Representations.
Neither
this Agreement nor any exhibit
attached hereto nor any certificate, financial statement, correspondence or
other document delivered or furnished
to Lender hereunder or in connection with the transactions contemplated
hereby contains or will contain any untrue statement of a material fact or
omits or will omit to state a material fact
necessary in order to make the statements contained herein and therein not misleading. There is no fact (a) which
materially and adversely affects Borrower’s ability to perform its obligations under the Loan Documents, or
the
condition, financial or otherwise, business or prospects of Borrower,
(b) which may result in any liability on the part of Borrower not reflected on the financial statements described
in Section 7.11, (c) which questions


37







or denies the right of Borrower or its Affiliates to
conduct their business or operate a Project, or (d) which prevents or restricts
the granting of security interests to Lender in the Collateral.


                    8.          Representations,
Warranties and Covenants With Respect to the Project. Borrower
represents and warrants to and covenants with Lender as follows, with respect
to each Unit included or to be included in each Project, that at the time such
Unit is included as one of the Projects and any Timeshare Interest in such Unit
is encumbered by a Mortgage assigned to Lender (as applicable), all of the
following shall be accurate and complied with:


                                 8.1          Access,
Utilities and Parking. As required by applicable Legal
Requirements, such Unit has and will have adequate access from a publicly
dedicated street and is served by adequate utilities, including public water
and sewer, and has adequate parking facilities.


                                 8.2          Compliance.
Borrower and the applicable Project are in compliance with
and will comply with all Legal Requirements in a manner that Borrower’s failure
to so comply would not be reasonably expected to result in a Material Adverse
Change.


                                 8.3          Declarations.
Such Unit and all equipment, furnishings and appliances
intended for use in connection therewith have been and will continue to be duly
submitted to the provisions of the applicable Declaration, which has been
recorded in the real property records of the jurisdiction in which the
applicable Project is located. The applicable Declarations will not be
cancelled or materially amended in a manner that would reasonably be expected
to result in a Material Adverse Change.


                                 8.4          Zoning
Laws, Building Codes, Etc. The applicable Project, all
the buildings and other improvements in which the Unit is situated and all
Amenities for such Unit have been or will be completed in compliance with all
applicable zoning codes, building codes, health codes, fire and safety codes,
and other Legal Requirements, including without limitation, so-called “environmental” laws in a manner that
Borrower’s failure to so comply would not be reasonably expected to result in a
Material Adverse Change. All material inspections, licenses, permits required
to be made or issued in respect of such buildings and Amenities have been or
will be made or issued by the appropriate authorities. The use and occupancy of
such buildings for their intended purposes are and will be lawful under all
applicable Legal Requirements. Final certificates of occupancy or the
applicable jurisdictional equivalent have been or will be issued and are or
will be in effect for such Unit. The timeshare use and occupancy of such Unit
do not and will not violate or constitute a non-conforming use under any
private covenant or restriction or any zoning, use or similar law, ordinance or
regulation affecting the use or occupancy of the applicable Project.


                                 8.5          Unit
Ready for Use. The Unit is fully furnished and ready for
use. All common furnishings (including appliances) within such Unit are owned
by Borrower or its Affiliates or the applicable Association, have been or will
be fully paid for, and are and will be free and clear of any liens or other
interests of any third party including any lessor.


38







                                 8.6          Property
Taxes and Fees. All real property taxes, condominium and
similar maintenance fees, rents, assessments and like charges affecting the
Units have been fully paid to date, to the extent such items are due and
payable.


                                 8.7          No
Defaults. No default or condition which, with the giving
of notice or passage of time, or both, would constitute a default, exists with
respect to any mortgage, deed of trust or other encumbrance against the Project
in which such Unit is located.


                    The
Project in which such Unit is located has been approved by the applicable
Division as a timeshare project and has been established and dedicated as a
timeshare project in full compliance with all applicable Legal Requirements,
including without limitation, the applicable Timeshare Act in a manner that
Borrower’s failure to so comply would not be reasonably expected to result in a
Material Adverse Change. Borrower or its Affiliates have all registrations,
approvals and licenses required under all applicable Legal Requirements for
such Project to be operated as a timeshare project, for the sale of Timeshare
Interests in such Project, for the making of Timeshare Loans related to such
Project, and for the ownership, operation and management of such Project in a
manner that Borrower’s or any of its Affiliates’ failure to have such
registrations, approvals or licenses would not be reasonably expected to result
in a Material Adverse Change.


                                 8.8          Timeshare
Approvals. The Project in which such Unit is located has
been approved by the applicable Division as a timeshare project and has been
established and dedicated as a timeshare project in full compliance with all
applicable Legal Requirements, including without limitation, the applicable
Timeshare Act in a manner that Borrower’s failure to so comply would not be
reasonably expected to result in a Material Adverse Change. Borrower or its
Affiliates have obtained and are maintaining all Timeshare Approvals for such
Project and the Vacation Club.


                                 8.9          Sale
of Timeshare Interests. The Vacation Club and the
Timeshare Interests are, as of the Closing Date, registered or exempt from
registration under applicable Legal Requirements in the respective states in
which each are marketed and/or sold, including those states listed on Schedule 8.9, as applicable. The
Vacation Club and the Timeshare Interests will be, after the Closing Date,
registered or exempt from registration under applicable Legal Requirements in
the respective states in which each are marketed and/or sold, as applicable.
All sales have been and will be made in compliance with all Legal Requirements
and utilizing then current and approved Public Reports in a manner that
Borrower’s failure to so comply would not be reasonably expected to result in a
Material Adverse Change. The marketing, sale, offering for sale, rental,
solicitation of purchasers and financing of Timeshare Interests related to the
Projects: (a) will not constitute the sale, or the offering for sale, of securities
subject to the registration requirements of the Securities Act of 1933, as
amended, or any other federal or state securities law applicable to such sale
or offer for sale; (b) will not violate the Timeshare Act or any applicable
land sales or consumer protection law, statute or regulation; and (c) will not
violate any applicable consumer credit or usury statute in a manner that would
reasonably be expected to result in a Material Adverse Change.


                                 8.10          Brokers.
All marketing and sales activities have been and will be
performed by employees or independent contractors of Borrower or its
Affiliates, all of whom


39







are and will be properly licensed or exempt from
licensing in accordance with applicable laws. Borrower or its Affiliates will
retain a duly licensed broker of record for each Project as may required by
applicable law in the state in which such Project is located.


                                 8.11          Tangible
Property; Non-Disturbance Agreements. The machinery, equipment, fixtures, tools and supplies used or
to be used in connection with each Project, including without limitation, with
respect to the operations and maintenance of the common elements, are and will
be owned or leased either by Borrower or its Affiliates or the applicable
Association or the Owners of Timeshare Interests in common.


                                 8.12          Condition
of Project. None of the Projects are now damaged nor
injured as a result of any fire, explosion, accident, flood or other casualty,
where the risk of loss is not otherwise covered by insurance or exceeds $50,000
at such Project, subject to reasonable deductibles and not otherwise repaired.


                                 8.13          Assessments.
Each Owner of a Timeshare Interest (and Borrower, or its
Affiliates, with respect to unsold timeshare Interests in a Project)
automatically will be a member of the applicable Association for such Project,
which Association has authority to levy annual Assessments to cover the costs
of maintaining and operating such Project. Any lien for unpaid Assessments will
at all times be subordinate to the lien of each Mortgage assigned to Lender.
Each Owner’s membership in such Association is immediately conveyed to the
Trustee under the applicable Purchase Agreement and the Trustee will thereafter
remain a member of such Association and be entitled to vote on the affairs
thereof, subject only to retaining ownership of the Timeshare Interest. To
Borrower’s knowledge, each Timeshare Association is and will continue to be
solvent. To Borrower’s knowledge, levied Assessments are and will be adequate
to cover the current costs of maintaining and operating the applicable Project
and to establish and maintain a reasonable reserve for capital improvements. To
Borrower’s knowledge, there are no reasonably foreseeable circumstances which
could give rise to a material increase in such costs, except for additions of
subsequent phases of a Project that will not materially increase Assessments.


                                 8.14          Developer
Subsidy. Except as
described in Schedule 8.14 the
Assessments levied with respect to each Primary Project are sufficient
to cover all expenses of the Association for each Primary Project.


                                 8.15          Project
Documents. The contracts, agreements and documents (and
all amendments and modifications thereto) described on Schedule 8.15 comprise all of the
existing Project Documents related to the Primary Projects. None of such
Project Documents will be amended, modified, terminated or waived in whole or
in part, after the Closing Date, in a manner that is material and adverse to
Lender.


                                 8.16          Common
Areas and Amenities. All Amenities for the Projects have
been or will be completed. To the extent that any of such Amenities are located
on property not owned by Borrower or the applicable Association or Timeshare
Owners, or to the extent that any such Amenities are subject to any liens or
encumbrances, there are in existence valid and enforceable agreements granting
the applicable Owners of Timeshare Interests the right to use such Amenities
without disturbance by any third parties. Except as otherwise permitted


40







and disclosed by the applicable Project Documents: (a)
each Association or the Owners of Timeshare Interests in common (which
interests may be held by the Trustee pursuant to the Purchase Agreements) will
at all times own the furnishing in the Units and all the common areas in the
applicable Project and other Amenities which have been promised or represented
as being available to Purchasers, free and clear of liens and security
interests except for the Permitted Encumbrances; (b) no part of any Project is
or will be subject to partition by the Owners of Timeshare Interests; and (c)
all access roads and utilities and off-site improvements necessary to the use
of a Project have been and will be dedicated to and/or accepted by the
responsible governmental authority or utility company or are owned by an
association of owners of property in a larger planned development or
developments of which a Project is a part.


                                 8.17        Trust
Agreement. Borrower has delivered or caused to be delivered
to Lender a true and complete copy of the fully executed Trust Agreement and
all amendments thereto. Borrower shall use its best efforts to ensure that the
Trust Agreement will not be amended, modified or supplemented unless any such
amendment, modification or supplement is permitted in accordance with the terms
of the Trust Agreement and applicable Legal Requirements, and a copy has been
delivered to Lender. To the best of Borrower’s knowledge, there are no existing
outstanding violations or breaches of the Trust Agreement.


                    9.         Representations,
Warranties and Covenants with Respect to the Timeshare Loans. Borrower
represents and warrants to and covenants to and with Lender, with respect to
each Timeshare Loan now or hereafter comprising part of the Liberty Portfolio
Timeshare Loans or which Borrower has otherwise identified to Lender as a
Qualified Timeshare Loan, and with respect to all other documents and
instruments executed in connection with the sale of any Timeshare Interest
financed by such Timeshare Loan, which representations, warranties and
covenants shall continue to be true in all respects while this Agreement is in
effect:


                                 9.1          No
Defaults. Each Note, Mortgage and every other
Consumer Document and instrument made and delivered in connection therewith
will in every respect be genuine and no default thereunder will exist.


                                 9.2          Validity.
Each Timeshare Loan will constitute a Qualified Timeshare
Loan and each Note will be a valid Qualified Note. Each Mortgage will be a
Qualified Mortgage. Each Note, Mortgage and all related Consumer Documents will
be valid and arising from the Qualified Sale of a Timeshare Interest to a
Purchaser. At the time of collateral assignment to Lender to the best of
Borrower’s knowledge no Purchaser thereunder will have died.


                                 9.3          Competency.
All parties thereto will have been competent to contract at
the time they executed such Note, Mortgage and related applicable Consumer
Documents.


                                 9.4          Defenses;
Rescission. There will be no defenses in law or in equity
(including without limitation the defense of usury), set-off or counterclaim to
the Note, Mortgage or related Consumer Documents as the same will exist in the
hands of Lender after collateral assignment thereof to Lender, nor to the
obligation of the Purchaser to pay the balance


41







of the Sales Price, nor will there exist any right in
the Purchaser to cancel or rescind such Note, Mortgage or related Consumer
Documents or the sale in connection with which the same were executed and
delivered.


                                 9.5          Legal
Requirements. Each Timeshare Loan collaterally assigned
to Lender pursuant to this Agreement and the related solicitation, marketing
and sale of the Timeshare Interest will have been effected in compliance with
all Legal Requirements, including, without limitation, to the extent
applicable, the applicable Timeshare Act, the USA Patriot Act, the
Gramm-Leach-Bliley Privacy Act, the Securities Exchange Act of 1934, the
Truth-In-Lending Act (15 U.S.C. Section 1601, et seq.) and Regulation Z
thereunder, the Equal Credit Opportunity Act (15 U.S.C. Section 1691, et seq.)
and Regulation B thereunder, the Interstate Land Sales Full Disclosure Act (15
U.S.C. Section 1701, et seq.), the Real Estate Settlement Procedures Act (12
U.S.C. Section 2601, et seq.) and Regulation X thereunder and the Fair Housing
Law, the Mail Fraud Statute (18 U.S.C. Section 1341), the Federal Trade
Commission Act, The Flood Disaster Protection Act of 1973, the Federal Trade
Commission’s Privacy of Consumer Financial Information Rule, Federal Trade
Commission “do-not-call” rules, and all other material legal restrictions,
contracts and agreements governing or affecting the applicable Project,
Borrower or its business or operations, including, without limitation, zoning,
environmental and other land use laws and regulations, subdivision map acts,
blue sky laws, real estate syndication acts and usury laws.


                                 9.6          Payments.
The “down payment” shown in the applicable Purchase Agreement
in connection with the sale of the Timeshare Interest will have been made by
Purchaser, in available funds (which cash down payment may, in the case of an
Upgraded Note Receivable or a conversion under a Sampler Program Agreement, be
represented in part or in whole by the principal payments and down payment made
on, as applicable, such original Qualified Note or the related Sampler Loan
since its date of origination), and neither all nor any part of such payment or
any payment on account of the Note will have been made by Borrower or any
Affiliate of Borrower.


                                 9.7          Payments
by Borrower. Neither Borrower nor any Affiliate of
Borrower will have made or will make any payment on behalf of any Purchaser.


                                 9.8          Title;
Title Insurance. Each Mortgage securing a Note will have
been duly executed and acknowledged and will constitute a valid Qualified
Mortgage of the Timeshare Interest described therein, as security for the
payment of such Note. Each Mortgage will be insured by a valid, existing Title
Insurance Policy issued or to be issued by the Title Company insuring the
interest of the mortgagee thereunder (and such mortgagee’s successors and
assigns) as a first mortgage lien against the Timeshare Interest described
therein. Each of the mortgagee’s Title Insurance Policies will be in an amount
at least equal to the unpaid principal balance of the Timeshare Loan. A Title
Insurance Policy may insure more than one Qualified Mortgage, provided that,
the aggregate amount of such Title Insurance Policy is at least equal to the
aggregate unpaid balances of the Qualified Timeshare Loans secured by such
Qualified Mortgages.


42







                                   9.9          Right
to Convey. As to each Timeshare Interest, Borrower or its Affiliates will have good title to and lawful
right and full authority to convey the Timeshare Interest to the Purchaser thereof.


                                   9.10        Bankruptcy;
Litigation. Each
Purchaser and each guarantor of any
Purchaser’s obligations under such Timeshare Loan will not be the subject of
any proceedings under any Debtor
Relief Laws, and will not be involved in any litigation with Borrower.


                                   9.11        Authorization.
All corporate,
partnership or other Purchaser(s), not
individuals, will have been duly authorized by corporate resolution, or other
appropriate action, to purchase a
Timeshare Interest and execute (as applicable) and deliver the Note, Mortgage
and related Consumer Documents.


                                   9.12        Representations. There
will have been no misrepresentations by Borrower, its Affiliates or any of their employees and/or selling agents
to any Purchaser or Lender as to the
Amenities or services available at the Project with respect to the amount of
the common expenses or other charges to be paid by a Purchaser or with respect
to any other matter relating to the Project, any Timeshare Interest, the
Note, the Mortgage, or any other aspect of the sale or the financing thereof.


                                   9.13        Notice
of Assignment. Each
Purchaser will have been directed to make all payments on account
thereof as provided in Section 6.6
of this Agreement.


                                   9.14        Marketability. Borrower
will have no knowledge of any circumstance with respect to the Timeshare
Loan, the Timeshare Interest, or the Project, which would reasonably be
expected to cause the Timeshare Loan to become delinquent or adversely affect
the marketability of the mortgaged Timeshare Interest or the related Timeshare
Loan.


                                   9.15        Recording
of Mortgages. Each Mortgage
collaterally assigned to Lender will have been or will be recorded in the
Public Records and all costs, fees and expenses arising out of the closing of the Timeshare Loan and of recording
of
the Mortgage will have been paid.


                                   9.16        Recording
of Deed. A
duly executed Deed by which the Timeshare Interest described on each
Mortgage assigned to Lender (if applicable) was conveyed to the Trustee will have been recorded in the Public
Records prior to the recording of the Mortgage.


                                   9.17        Amendment. Other
than in connection with Permitted Modifications, the terms of the
Timeshare Loan and the Consumer Documents related thereto, will not have been
assumed, amended or modified in any respect.


                                   9.18        Assignment;
No Liens. Borrower
will be the sole owner of the Timeshare Loan free of all prior assignments,
liens, encumbrances and claims of third parties whatsoever and will have full right and lawful authority to
assign the
same to Lender, as contemplated by
this Agreement.


43







                                   9.19        Loan
File. Borrower
will, at the time of the assignment thereof to Lender, have in its possession or will have delivered to the
Custodian a
complete Loan File in respect of each
of the Timeshare Loans and Borrower will have delivered to Lender all documents required to be delivered pursuant
to
Borrower’s Request for Receivables Loan Advance.


                                   9.20        Public
Reports. The Public Report for
the Vacation Club, a copy of which has been furnished to Lender has been
approved by all applicable regulatory agencies and in form and content complies with all applicable Legal
Requirements
in a manner that Borrower’s failure
to so comply would not be reasonably expected to result in a Material Adverse
Change. With respect to the sale of each Timeshare Interest, there will be in
effect at the time of sale and Borrower or
its Affiliates will have used an unexpired, Public Report, approved by all applicable regulatory agencies. If
required by the applicable law of a state in which Borrower or its
Affiliates is selling Timeshare Interests, Borrower will keep such Public Reports up-dated and approved by the
applicable
regulatory agency of that state and upon request by Lender will promptly deliver to Lender evidence of such
continued approval, including all extensions thereof, promptly upon
receipt by Borrower. Borrower will deliver or cause
to be delivered to Lender on an annual basis a copy of the Public Report for
the Vacation Club.


                                   9.21        Credit. The
credit application and other documents relating to the credit of a Purchaser, obtained by or delivered to
Lender in connection with a Request for Receivables Loan Advance, will be
accurate and complete copies of the originals and will constitute all the documents which will have come
into the possession of Borrower which relate to the credit worthiness of
the Purchaser.


                                   9.22        Qualified
Timeshare Loans. Each Liberty
Portfolio Timeshare Loan or other Timeshare Loan which Borrower has indicated
to Lender is a Qualified Timeshare Loan will meet all the requirements of a
Qualified Timeshare Loan.


                                   9.23        Enforceability. The
Consumer Documents are and at all times will remain in full force and effect
and will be valid and binding obligations of the respective parties thereto.


                                   9.24        No Impairment.
The grant of the security interests described herein has not affected and will not affect
the
validity or enforceability of the Consumer Documents.


                                   9.25        No
Defaults. Each Consumer Document will in every
respect be genuine and no default thereunder will exist.


                                   9.26        Assumption. Borrower
will not agree to the assumption of the Timeshare Loan by any third
party acquiring the applicable Timeshare Interest, without the prior written
consent of Lender unless otherwise required by applicable Legal Requirements.


                                   9.27        Executory
Obligations. Borrower
or its Affiliates have performed all of their obligations to the Purchasers and
there are no executory obligations owed to Purchasers to be performed by Borrower or its Affiliates, except for
non-delinquent and


44







executory
obligations disclosed to Purchasers in their Purchase Agreements or the Project
Documents.


                                   9.28        Fulfillment
of Obligations to
Purchasers. Borrower will fulfill, and will cause its
Affiliates, agents and independent contractors at all times to fulfill, all
their respective obligations to Purchasers.
Borrower or its Affiliates will perform all of their respective
obligations under the Consumer Documents and the Project Documents.


                    10.          Consumer
Documents. Borrower represents
to and agrees with Lender that the Consumer
Documents, in substantially the forms attached hereto as Exhibit A are the only documents which
have been used in connection
with the credit sale of Timeshare Interests in respect of the Primary Projects and that Borrower shall not modify
or
amend, or permit the modification or
amendment of, any of such Consumer Documents in a manner that would cause any of such Consumer Documents to fail
to comply
with Legal Requirements or use or permit the use by others of any other or additional documents in connection with
the credit sale of Timeshare
Interests, except with the prior written consent of Lender, or as reasonably
requested by Lender in order to meet any of the Legal Requirements or to
protect Lender’s security interest therein.
Notwithstanding anything herein or elsewhere to the contrary, Borrower shall be
permitted to amend the form of
Consumer Documents to the extent necessary to comply with applicable Legal Requirements, without the need to
obtain Lender’s prior consent to such amendment. If any such Consumer
Document shall be modified or amended or if any additional document shall be
used in connection with the credit sale of Timeshare Interests, Borrower shall
immediately provide to Lender an accurate and complete copy of such Consumer
Document as so modified or amended and of any such additional document.


          In
the event that any of the Consumer Documents in substantially the forms
attached hereto as Exhibit A
are modified or amended in a manner such that they do not comply with
applicable Legal Requirements or Borrower has not received Lender’s written
consent to use or permit the use by others
of any other or additional documents in connection with the credit sale of
Timeshare Interests in respect of the Primary Projects for a reason other than
to comply with Legal Requirements (“Non-Complying Consumer Documents”), Lender
shall not have any obligation to make any Advances under the Receivables Loan
in respect of the Timeshare Loans related to such Non-Complying Consumer
Documents. Notwithstanding the foregoing, in the event that Lender has made Advances in respect of the Timeshare
Loans
related to such Non-Complying Consumer Documents, Borrower shall promptly
either (i) prepay an amount equal to such Advance together with accrued
interest thereon, (ii) pledge additional Qualified Timeshare Loans as
part of the Liberty Portfolio Timeshare Loans in an amount sufficient to cure
the deficiency, or (iii) prepay, in part,
and pledge additional Qualified Timeshare Loans, in part, in a total amount sufficient to cure the
deficiency.


                    11.          Payment
or Replacement of Timeshare Loans.


                                   11.1        Delinquent
Loans. Borrower
shall pay to Lender an amount equal to
90% of the then unpaid principal balance of any Timeshare Loan comprising part
of the Liberty Portfolio Timeshare Loans in the event that: (a) such Timeshare
Loan becomes a Delinquent Loan, (b) any applicable representation or
warranty set forth at Sections 8 or 9
or elsewhere herein proves false with
respect to such Timeshare Loan, (c) the attorney, Title


45







Company or other approved
person fails to comply with the requirements of Section 22.1 with respect
to such Timeshare Loan to the extent applicable, or (d) Borrower shall fail to
deliver a Title Insurance Policy, as required by Section 22.2 with respect to such
Timeshare Loan. With respect to a Delinquent
Loan, such payment shall be made on or before the thirtieth (30th) day after
such Timeshare Loan has become a Delinquent Loan, computed without reference to
any notice or grace period. With respect to a Timeshare Loan in respect of
which a representation or warranty proves or
becomes false or which Borrower is obligated to pay under subsection 11.1(c) or
(d), such
payment shall be made within thirty (30) days after Borrower becomes aware
of such false representation or warranty, failure to confirm or failure to
deliver, by receipt of notice from Lender or
otherwise. Other than in connection with Permitted Modifications, Borrower may not cure any actual or anticipated
delinquency of any Liberty Portfolio Timeshare Loan by revising, rewriting or
recasting the payment terms of such Timeshare Loan. In the event that the then outstanding principal balance of
the
Receivables Loan is less than 90% of the aggregate outstanding principal
balances of the Timeshare Loans then comprising the Liberty Portfolio Timeshare
Loans (after removal of the applicable Delinquent Loans and Timeshare Loans described in subsection 11.1(c)
and (d), Lender at its sole discretion
may waive the prepayment requirement set forth in the first sentence of
this Section 11.1.


                                   11.2        Replacement. In
lieu of making the payment required by Section 11.1, Borrower
may replace the Timeshare Loan involved by assigning and including in the Liberty
Portfolio Timeshare Loans another Qualified Timeshare Loan of equal or greater
unpaid principal balance which may be calculated on an aggregate basis.


                                   11.3        Documents. Each
time Borrower shall, pursuant to Section
11.2, replace a Timeshare Loan, Borrower shall deliver to
Lender in respect of such replacement Timeshare Loan all of the documents
described at Section 2.3 to
be delivered in connection with an Advance,
other than a Request for Advance and the matters referenced in Section 21.7, with respect
to such replacement Timeshare Loan shall be satisfied.


                                   11.4        Application
of Representations and Warranties to Replacement Timeshare Loans. All
applicable representations and warranties set forth in this Agreement
shall apply to and be true in all respects to each replacement Timeshare Loan.


                    12.          Reassignment of Timeshare
Loans by Lender; Collection Proceedings; Etc.



                                   12.1        Collection
Proceedings. Borrower shall,
pursuant to the Servicing Agreement, undertake the diligent and timely
collection of all amounts due under each Liberty Portfolio Timeshare Loan, and
will bear the entire expense of such collection. Lender shall have no
obligation to undertake any action to collect under any Liberty Portfolio
Timeshare Loans. If Borrower shall fail promptly to pay in full, or replace any
Liberty Portfolio Timeshare Loans which Borrower is obligated by the provisions
of Sections 11.1 or 11.2 hereof
to pay or replace, Lender may, at its
option and without affecting any other right of Lender hereunder, take such measures as it shall deem appropriate
to collect
such Liberty Portfolio Timeshare Loans, including, as applicable,
foreclosure of any Mortgage. Borrower agrees that it will be liable to Lender for any deficiency on any such
Liberty
Portfolio Timeshare Loans, and for any and all expenses, including, without limitation, reasonable
attorneys’ fees,
incurred by Lender in


46







connection
with any such action. Borrower agrees and acknowledges that Lender shall not be
responsible to it for any action so taken or for failing to take any
action in connection therewith, including,
without limitation, the granting of any extensions of time, waivers or other indulgences
or the compromise or reduction of any amounts due. Borrower may not terminate any Purchase Agreement or resell
any Timeshare
Interest financed by a Liberty Portfolio Timeshare Loan without Lender’s
prior written consent.


                                   12.2        Reassignments.
Provided that no
Incipient Default or Event of Default
exists, upon Borrower’s payment in full of the sums required under Section 11.1 with respect
to a Delinquent Loan or a Timeshare Loan in
respect of which a representation or warranty proves to be or becomes
false (or replacement of such Timeshare Loan as provided in Section 11.2) Lender shall reassign and
deliver to Borrower the applicable Qualified Note (duly endorsed to Borrower), together with the related
Qualified Mortgage and
other Consumer Documents and related documents previously delivered to
Lender or in connection with the assignment
of such Timeshare Loan to Lender. Upon Borrower’s payment in full of all Obligations,
Lender shall reassign and deliver to Borrower all the Notes, together with the
Mortgages securing the same, which are at the time assigned to Lender, as
security pursuant hereto, together with all
related documents then in the possession of Lender. All endorsements and
reassignments by Lender to Borrower shall be (a) in form reasonably
satisfactory to Lender, (b) at the expense
of Borrower, and (c) without recourse, representation or warranty, expressed or implied.


                    13.          General
Affirmative Covenants. Borrower
covenants and agrees with Lender as follows:


                                   13.1        Payment
of Taxes and Claims. Borrower
or its Affiliates shall pay or cause to be paid before they become
delinquent:


                                                  (a)          all
taxes, condominium fees, maintenance fees, Assessments and governmental charges or levies imposed
upon it or the Projects, except for permitted
contests under Section 6.9;


                                                  (b)          all
claims or demands of materialmen, contractors, subcontractors, mechanics,
carriers, warehousemen and other Persons, which, if unpaid, might result in the
creation of a lien upon any Timeshare Interest or the Mortgaged Property,
except for permitted contests under Section 6.9;


                                                  (c)
          all taxes, condominium fees, maintenance fees,
Assessments and governmental charges on levies
imposed upon any Timeshare Interests owned by Borrower or its
Affiliates, except for permitted contests under Section 6.9;


                                                  (d)          all
expenses of recording any Assignments and any
other Loan Documents;


                                                  (e)          all
expenses of UCC-1 financing statements
reasonably necessary to perfect the security interests granted under the
Loan Documents;


                                                  (f)          all
amounts payable to the Lockbox Bank for the
Lockbox


47







Bank’s services under and
pursuant to the Lockbox Agreement;


                                                  (g)          all
amounts payable to any Servicer for services
rendered under and pursuant to the Servicing Agreement; and


                                                  (h)          all
amounts payable to the Custodian for services
rendered under and pursuant to the Custodial Agreement.


                    If
requested by Lender, Borrower shall promptly, but in no event later than
fifteen (15) days after such request by Lender, furnish or cause the
Associations to furnish to Lender, evidence that all real estate taxes and
Assessments related to the Projects have been paid in full when due. If Lender
has requested and Lender fails to receive such evidence, satisfactory to Lender, within the time period provided
herein,
Lender may require that escrows be established to cover such taxes and Assessments and may fund such escrows or
pay
such taxes and Assessments from collections received on the Timeshare
Loans.


                                   13.2        Maintenance
of Property. Borrower or its Affiliates shall maintain or cause the Associations managed by the Vacation
Club Manager
to maintain all properties and assets material to their business, the
Amenities, the Units and the Projects in good condition
and make all necessary renewals, repairs, replacements, additions, betterments,
and improvements thereto. So long as
Borrower or its Affiliates are in control of the Associations, Borrower or its Affiliates shall maintain or cause
each Association managed by the Vacation Club Manager to maintain a reasonable reserve to assure compliance with
the terms of the foregoing sentence.


                                   13.3        Insurance.


                                                  (a)          Borrower
shall maintain or cause the Associations
to maintain
the insurance coverage in amount and scope no less than as described on Schedule
13.3. Such
insurance coverage amounts shall be increased from time to time as may be necessary to cover the full replacement
cost of
the buildings, personal property and Amenities comprising the Projects. Casualty loss insurance for the Projects
shall
specifically include insurance
against hurricane, wind, wind driven water and earthquake risks as reasonably applicable
based on the location of the Project. Such insurance shall be maintained in
force with insurers having an AM Best
rating from A++ to B++; provided, however, for the purposes of
this Section 13.3, the
insurance maintained by Borrower or the Associations as of the Closing Date shall be deemed to be approved by
Lender
notwithstanding the fact that certain of the insurers have an AM Best
rating of less than B++. Notwithstanding the foregoing, in the event that any insurer having an AM Best rating
from A++ to B++
as of the Closing Date is downgraded to an AM Best rating of less than
B++, such occurrence shall not be deemed to be an Event of Default for a period
of one hundred twenty (120) days, during which time period Borrower shall
notify Lender of such downgrade in AM Best
rating and Lender shall, in its reasonable discretion, either approve such downgrade or require Borrower
to replace such insurer with an insurer having an AM Best rating of not
less than B++.


                                                  (b)          Borrower
shall cause Lender to be named as loss
payee (with a lender’s loss payable endorsement) with respect to all
personal property Collateral, and


48







additional
insured with respect to all liability insurance (other than errors and
omissions coverage), as its interests
may appear. Each policy shall provide that such policy may not be canceled or materially changed except upon (i)
providing ten (10) days’ prior written notice, with respect to casualty insurance coverage, and (ii)
endeavoring to provide ten (10) days’ prior written notice, with respect to liability insurance coverage, of
intention of non-renewal, cancellation
or material change to Lender and that no act or thing done by Borrower shall
invalidate any policy as against Lender; provided, however, that
Borrower agrees to use commercially reasonable efforts to require the
insurer to provide thirty (30) days’ prior written notice of cancellation.


                                                  (c)          Borrower
shall deliver or cause the Associations
to deliver to Lender copies of the
insurance policies and all endorsements thereto and evidence of insurance
utilizing a current ACORD 27 or 28 Evidence of Property Insurance and endeavor
to provide at least thirty (30) days prior
to the expiration of any such insurance, additional policies or
duplicates thereof and evidence of insurance utilizing a current ACORD 27 or 28
Evidence of Property Insurance confirming
the renewal of such insurance and payment of the premium therefor. If Lender fails to receive such evidence,
Lender may require that escrows be established
to cover such premiums.


                                                  (d)          Except
as otherwise expressly provided in the
applicable Declarations or by
applicable Legal Requirements, in the event of any casualty loss to any
Project, Lender, at its option, may, to the extent Lender is entitled to any
related insurance proceeds and subject to the prior existing rights of
other lenders of Borrower or its Affiliates, (i) retain and apply all or any part of such insurance proceeds to
repay or
secure the Obligations, in such order
and amounts as Lender may elect, or (ii) disburse all or any part of such
insurance proceeds to or for the
benefit of Borrower for the purpose of repairing or replacing any Project, in
either case without waiving or impairing the Obligations or any provision of
this Agreement. To the extent
applicable, any deficiency thereon shall be paid by Borrower to Lender upon demand. Except to the extent
otherwise set forth in
this Agreement or the other Loan Documents, Borrower shall bear the full
risk of loss from any loss of any nature whatsoever with respect to the Collateral.


                                                  (e)          If
any of the Projects are within an area
designated by the Director of the
Federal Emergency Management Agency, pursuant to the Flood Disaster Protection
Act of 1973, as amended, as one having special flood hazards, Borrower shall maintain
or cause the Association to maintain flood insurance to the maximum limit of
coverage available thereunder or as may otherwise be available in the
commercial insurance market.


                                   13.4        Existence
and Rights. Borrower shall do or cause to be done all things necessary
to preserve and keep in full force and effect their respective existence,
rights, privileges, qualifications,
permits, licenses, franchises, and other rights material to their business.


                                   13.5        Failure
to Pay Taxes, Insurance, Etc. If
Borrower or its Affiliates fails to
pay any item of the type described in Sections
13.1, 13.2 or 13.3 and is not contesting such items as may be permitted under Sections 13.1(a), (b)
and (c), Lender
may pay the same either with funds
deposited with Lender by Borrower, with an Advance under the Receivables Loan (without the requirement of any
Request for Receivables Loan Advance) or


49







with its own funds. If
Borrower fails to maintain or cause to be maintained insurance as required by Section
13.3 hereof, Lender may obtain such insurance and pay the
premiums therefor. Borrower shall,
upon the written demand of Lender, reimburse Lender the full amount of all payment
made by Lender with respect to the obligations of Borrower under Sections 13.1, 13.2 and 13.3 to the
extent made with Lender’s funds, with interest thereon from the date of payment
by Lender to the date of reimbursement at the Default Rate. The obligation of
Borrower to make such reimbursement payments
shall constitute part of the Obligations and shall be secured by the Collateral
and each Guaranty, if any.


                    None
of the provisions of the Loan Documents shall be construed, however, as making the payment of such taxes,
assessments, governmental
charges, levies, claims of materialmen,
contractors, subcontractors, or other charges, or the maintenance of insurance,
obligatory upon Lender and Lender shall not be liable for any loss, damage or
injury resulting from the non-payment of such taxes, assessments, governmental
charges or levies, claims or demands
of materialmen, contractors, subcontractors, or other charges, or the
maintenance of said insurance. In the
event that Lender does maintain such insurance coverage as may be required by Section
13.3 hereof, Lender shall not be responsible for the solvency of
any company issuing any policy of insurance in connection therewith,
whether or not approved by it, or for the collection of any amount due under
any such policy, and shall be responsible and accountable only for such money
as may be actually received by it, and then only in accordance with the terms
of the Loan Documents. None of the provisions of the Loan Documents shall be
construed as making Lender liable in any way for any loss, damage or injury
resulting from the non-insurance of any buildings, improvements and/or personal
property located at the Project.


                                   13.6        Books
and Records. Borrower
or its Affiliates shall maintain and cause
the Associations to maintain true and current books, records and accounts in
which full and correct entries shall be made of all their transactions, and
will reflect in their financial statements adequate accruals and reserves, all in accordance with GAAP, and in
compliance with the rules and
regulations of all governmental regulatory bodies having jurisdiction over
Borrower, the Associations or the
Projects.


                                   13.7        Inspections.
Subject to applicable Legal Requirements and Governing Documents, including, without limitation, applicable
Declarations, Borrower or its Affiliates shall permit and cause the
Associations to permit employees or agents of Lender, from time to time, as required by Lender, to inspect
the Projects, and to examine or audit Borrower’s and the Associations
books, accounts and records and to make copies and memoranda thereof. Each
annual inspection, examination and audit, together with any inspections,
examinations or audits performed after the
occurrence of an Event of Default or after Lender has a good faith belief that an Event of Default has occurred,
shall
be at the expense of Borrower, including without limitation, reasonable costs of travel, lodging and meals.
Lender shall bear the expense of any
such inspection, examination or audit which is performed more than once on an
annual basis and which is performed
in the absence of the occurrence of an Event of Default or prior to the
time Lender has a good faith belief that an Event of Default has occurred.


                                   13.8        Regulatory
Approvals. Borrower
or its Affiliates shall maintain in full force and effect all Timeshare
Approvals and all other regulatory approvals, permits and consents for operation and use of the Projects and
the Vacation Club, sales of Timeshare


50







Interests in the Projects
and the Vacation Club and the making of Timeshare Loans. Borrower shall make or
pay, or cause to be made or paid, all registrations, declarations or fees with
the Divisions and any other government or
agency or department thereof, in all applicable jurisdictions, required
in connection with the Projects and the Vacation Club and the occupancy, use and operation thereof, the
incorporation of
the Units into the Projects, and the sale, advertising, marketing and offering for sale of Timeshare Interests.
Copies of all such registrations,
applications, consents, licenses, permits, franchises, approvals, exemption certificates,
filings and reports shall be delivered to Lender. At Lender’s reasonable
request from time to time, Borrower shall
deliver to Lender (a) written statements by the applicable state authorities confirming compliance with applicable
registration, license, permit, approval or filing requirements, all in form acceptable to Lender and
a legal opinion rendered by counsel acceptable
to Lender in substantially the form of the respective local counsel opinions
delivered as of the Closing Date, stating that either the Project is
duly registered, licensed, permitted or approved
in such state or that no registration, license, permit, approval or filing is
necessary, or (b) such other evidence
of compliance with applicable Legal Requirements as Lender may require.


                                   13.9        Compliance
With Laws, Etc. Borrower
shall (a) comply and cause the
Associations to comply with all Legal Requirements applicable to Borrower, the Associations and the Projects and
the Vacation
Club, (b) keep and perform, and cause the Associations to keep and perform, all of their obligations under all
agreements relating to the ownership,
management or operation of the Projects, (c) keep and perform, and cause the Associations to keep and perform,
all of their
obligations under the Declarations, (d) keep and perform, and cause the Associations to perform their obligations
under
their applicable Governing Documents,
(e) obtain and maintain and cause the Associations to maintain all licenses, registrations, approvals and other
authority as may be necessary to enable them to own and operate their business and perform all other
obligations, (f) not permit the Projects to be used in a manner to
violate any covenant, restriction or any zoning use or similar law, and (g)
comply and cause the Associations to comply with all obligations owed to the
Purchasers.


                                   13.10       Management
of Borrower. Borrower
shall cause its business to be continuously managed by professional and
qualified management and staff.


                                   13.11        Loan
Files. Borrower shall maintain,
in trust for the benefit of Lender,
continuous possession of the originals of all documents comprising the Loan
File for each Liberty Portfolio
Timeshare Loan, which have not been delivered to Lender (or to a custodian for Lender) and shall deliver to Lender
(or to a custodian for Lender) a copy of any documents in such Loan
Files as Lender may request.


                                   13.12        Management
Agreements. Borrower
or its Affiliates shall keep (or shall cause the Associations to keep)
Management Agreements with the Managers, or such other property managers
reasonably acceptable to Lender, for each of the Projects in full force and
effect and shall perform their obligations thereunder.


                                   13.13        Lockbox
Agreement. Borrower
shall keep the Lockbox Agreement (or
a substitute Lockbox Agreement with a lockbox agent acceptable to Lender) in


51







full
force and effect and shall perform its obligations thereunder, all in
accordance with the terms and conditions set forth in the Lockbox
Agreement.


                                   13.14        Servicing
Agreement. Borrower
shall service the Liberty Portfolio
Timeshare Loans in compliance with all applicable Legal Requirements and
otherwise in accordance with the terms and conditions set forth in the
Servicing Agreement.


                                   13.15        Project
Documents. Borrower
and its Affiliates shall comply with all of their obligations under the
applicable Project Documents. Borrower and its Affiliates shall not amend, modify, waive or terminate any of
the Project Documents, or enter into or permit the Associations to enter into any new Project Documents which
would in any way materially and
adversely alter the Projects, the rights of Purchasers, the rights of any
lender foreclosing on a Timeshare
Interest or any priority of past due Assessment claims over the lien of any mortgage.


                                   13.16        Assessments.
Borrower or its Affiliates (i) shall use its commercially reasonable
efforts to cause each Association to (A) discharge its obligations under the
applicable Project Documents and (B) maintain a reasonable reserve for capital
improvements to the applicable Project; and (ii) so long as Borrower or its
Affiliates controls the Association, shall pay to such Association any amounts
as and when required of Borrower under the
Project Documents.


                                   13.17        Maintenance
of Larger Tract. To
the extent that either a Project is
part of a larger common ownership regime or planned development or parts of
buildings in which Units are located are not part of a Project, Borrower
or its Affiliates shall pay any of their required
commercially reasonable share of common expenses to be allocated to the
applicable Project. Borrower or its Affiliates shall use commercially
reasonable efforts to cause all such property
which is not part of a Project to be professionally managed in a first class
manner. Borrower or its Affiliates
shall use commercially reasonable efforts not to permit common expenses
to be allocated to a Project in an unreasonably disproportionate manner.


                                   13.18        Accuracy
of Representations and Warranties. Borrower shall take all actions necessary to cause all
representations and warranties by Borrower in the Loan Documents to be true at all times while this
Agreement remains in effect (unless such representation or warranty
pertains to an earlier period of time).


                                   13.19        Additional
Documents and Future Actions. Borrower shall, at its sole cost, take such actions and provide
Lender from time to time with such agreements, financing statements and
additional instruments, documents or information as Lender may in its reasonable discretion deem necessary or
advisable
to perfect, protect, maintain or enforce the security interests in the Collateral, to permit Lender to protect or
enforce its interest in the Collateral,
or to carry out the terms of the Loan Documents. Borrower hereby authorizes and
appoints Lender and any officer of Lender as its attorney-in-fact, with
full power of substitution, to take such actions
as Lender may deem reasonably advisable to protect its interests in the Collateral and its rights hereunder, to
file at
Borrower’s expense financing statements, and amendments thereto, in those
public offices deemed necessary or appropriate by Lender to establish,
maintain and protect a continuously perfected security interest in the
Collateral, and to


52







execute on Borrower’s behalf such other documents and
notices as Lender may deem reasonably advisable to protect the Collateral and
its interests therein and its rights hereunder. Such power being coupled with
an interest is irrevocable.


                                   13.20        Inventory
Controls. Borrower shall, or shall cause its Affiliates, to maintain a
“One-to-One Owner Beneficiary to Accommodation Ratio” (as defined in the Trust Agreement)
at all times.


                                   13.21        Trust
Agreement. Borrower shall
and Borrower shall cause its Affiliates to comply with all of their
respective obligations under the Trust Agreement.


                    14.          Negative
Covenants. Borrower
covenants and agrees with Lender as follows:


         
       
               
14.1          Organization. Borrower shall
not amend, modify or supplement its Governing Documents in a manner that would
be reasonably expected to result in a Material Adverse Change, or change its state of organization, without giving
Lender at least thirty (30) days
prior written notice.


                                   14.2          No
Transfers. Borrower shall not,
unless the Lender otherwise consents
in writing, which consent may be granted or withheld in Lender’s sole and
absolute discretion, make any
Transfer.


                                   14.3          Other
Business. Borrower shall
not make any material change in the
nature of the timeshare business that it conducts, as carried on as of the date
of this Agreement.


                                   14.4          Affiliate
Transactions. Except as set forth on Schedule 14.4, Borrower shall not conduct,
permit or suffer to be conducted, transactions with any Affiliate other
than arms-length transactions with Affiliates in the ordinary course of
Borrower’s business pursuant to terms that
are no less favorable to Borrower than the terms upon which such transfers or transactions would have been made had they been
made to or with a Person that is not an Affiliate.


                                   14.5          No
Lien on Collateral or Reservation System. Subject to Permitted
Encumbrances, Borrower shall not create, incur or permit to exist any mortgage,
pledge, encumbrance, lien or security
interest of any kind on any of the Collateral, the reservation system servicing the Vacation Club or
the Vacation Club Management Agreement. For avoidance of doubt, the
granting by Borrower or any of its Affiliates to any Person of a non­-exclusive license to use the reservation system
servicing the Vacation Club shall not be deemed to be a violation or
breach of this Section 14.5.


                 
                14.6  
      Proxies. Borrower
shall not
enter into proxies, voting trusts, shareholder
agreements of similar arrangements for the purpose of vesting voting rights, authority
or discretion of Borrower with respect to the Associations in any Person.


                                   14.7          Restrictive
Covenants. Borrower shall not consent to, or otherwise acquiesce in, any
change in any private restrictive covenant, planning or zoning law or


53







other public or private
restriction, which would materially and adversely limit or alter the use of any Project.


                                   14.8          Purposely
Omitted.


                                   14.9          Chief
Executive Office. Borrower
shall not change its chief executive
office or the location at which it does business without at least thirty (30)
days prior written notice to Lender
and delivery to Lender of such UCC amendments or other financing statement and access agreement as Lender may
require to maintain Lender’s lien against any of the Collateral and Lender’s ability to obtain access to such Collateral
and Borrower’s books and records.


                   
               14.10 
      Marketing/Sales. Borrower
shall not
market, attempt to sell or sell or
permit or justify any sales or attempted sales of any Timeshare Interests
except in compliance with the
applicable Timeshare Act and all applicable Legal Requirements in each other jurisdiction where marketing, sales or
solicitation activities occur in a manner that Borrower’s failure to so comply would not be reasonably expected to
result in a Material Adverse Change.


                 
             
   14.11       Amenities. Borrower shall
not make or permit the making of any promises
of or representations regarding any Amenities and their availability for use by
Purchasers other than as may be
provided in an applicable Public Report in compliance with applicable Legal Requirements.


                                   14.12       Trust
Agreement. Borrower shall use
its best efforts to ensure that the
trust established under the Trust Agreement will not be terminated as long as
any Obligations remain outstanding.
Borrower shall use its best efforts to ensure that the Trust Agreement will not be amended or modified in any
way which would materially and adversely affect the Obligations of
Borrower under the Loan Documents.


                                   14.13       Demand
Balancing Standard. Borrower shall not make any changes
to the Demand Balancing Standard set forth in the Trust Agreement other than in
compliance with the Trust Agreement and applicable Legal Requirements.


                    15.          Financial
Covenants.


                                   15.1          Minimum
Net Worth.  Borrower shall maintain consolidated Net Worth of not less than Three Hundred Twenty-Five Million Dollars
($325,000,000) commencing upon the date hereof and at all times hereafter.


                                   15.2          Maximum
Leverage.  Borrower shall maintain a ratio of consolidated Debt
to consolidated Net Worth not to exceed 2.5 to 1.0 commencing upon the date hereof and at all times hereafter.


                    16.          Financial
Statements and Reporting Requirements.


                                   16.1          Monthly
Reports.  Borrower, at
its sole cost and expense, shall, not
later than the tenth (10th) day of each month, furnish to Lender or cause the
Servicer to


54







furnish to Lender by e-mail,
Federal Express or similar “overnight” delivery service, three (3) copies of a report in the form attached hereto as
Exhibit J (which shall not contain any
confidential personal information relating to any Purchaser) prepared by
Borrower or the Servicer, with respect
to each of the Timeshare Loans situate in a Unit comprising part of a Primary
Project, and any other Project requested by Lender, as of the close of business
on the last Business Day of the calendar month last ended.


                                   16.2          Annual
Financial Statements. Borrower shall deliver to Lender, as soon as available and in any
event within ninety (90) days after the end of each fiscal year:


          
                                        (a)          The
consolidated income and retained earnings
statements of Borrower, for such
fiscal year,


                                                   
(b)          The consolidated balance sheets of Borrower as at
the end of such fiscal year, and


                                                   
(c)          The
consolidated audited statements of cash flow of Borrower for such fiscal year;


setting forth in comparative form
the corresponding figures as at the end of the previous fiscal year, all
in reasonable detail, including all supporting schedules and comments. Such
statements shall be prepared in accordance
with GAAP. Such statements shall be audited by an independent certified public accountant of recognized standing
acceptable to Lender with respect to which such accountants shall deliver their unqualified opinion. The
independent certified public accountants
auditing such statements as of the Closing Date shall be deemed acceptable to Lender. Such statements will be certified by the
chief financial officer or the equivalent of Borrower to be accurate.


                                   16.3          Annual
Association Financial Statements. Borrower shall deliver to
Lender, as soon as available and in any event within one hundred twenty (120)
days after the end of each fiscal
year:


                                                    (a)          The
income and retained earnings statements of
each Association of the Primary Projects, for such fiscal year,


                                                    (b)          The
balance sheets of each Association of the
Primary Projects as at the end of such fiscal year, and


                                                    (c)          The
audited statements of cash flow of each
Association of the Primary Projects for such fiscal year;


setting forth in comparative form
the corresponding figures as at the end of the previous fiscal year, all
in reasonable detail, including all supporting schedules and comments. Such
statements shall be prepared in accordance
with GAAP. Such statements shall be audited by an independent certified public accountant of recognized standing
acceptable to Lender with respect to which such accountants shall deliver their unqualified opinion. The
independent certified public accountants
auditing such statements as of the Closing Date shall be deemed acceptable to


55







Lender.
Such statements will be certified by the chief financial officer or the
equivalent of each Association to be accurate.


                                   16.4          Quarterly
Financial Statements. Borrower shall deliver to Lender, as soon as
available and in any event within forty-five (45) days after the end of each calendar quarter:


                                                    
(a)          The internally prepared consolidated income
statement of Borrower for such quarter,


                                                    
(b)          The internally prepared
consolidated balance sheets of Borrower for such quarter, and


                                                   
(c)          The internally prepared
consolidated statements of cash flow for Borrower for such quarter;


on a
quarter-to-date and year-to-date cumulative basis, and setting forth in
comparative form the corresponding figures as at the end of the corresponding
quarter of Borrower’s prior year, all in reasonable detail, and certified by the chief
financial officer of Borrower to be accurate and to have been prepared in
accordance with GAAP.


                                   16.5          SEC
Filings.


                                                   
(a)          Upon the request of Lender after its filing,
Borrower shall deliver to Lender the following: (i) a copy of Borrower’s
most current 10Q filing certified by the chief
financial officer of Borrower to fairly present the financial condition of
Borrower on a fully consolidated
basis as at the end of such fiscal quarter and the results of the operations of
Borrower on a fully consolidated
basis for the period ending on such date; and (ii) copies of any and all other
financial reports and corrections thereto and to the applicable 10Q filings
required of Borrower under federal laws and regulations.


                                                   
(b)          Upon the request of Lender after its filing,
Borrower shall deliver to Lender the
following: (i) a copy of Borrower’s most current 10K filing (and any 8K filing
with any material financial condition disclosures thereafter) certified by the
chief financial officer of Borrower to
fairly present the financial condition of Borrower on a fully consolidated basis at the end of such fiscal year and the
results of the operations of such entity on a fully consolidated basis at the end of such fiscal year
and the results of the operations of Borrower on a fully consolidated basis for
the period ending on such date; and (ii) copies of any and all other financial
reports and corrections thereto and to the applicable 10K filings (or 8K
filings, if any) required of Borrower under federal laws and regulations.


                                   16.6          Confirmation
of Compliance. The financial statements described at Sections
16.2 and 16.4 to be delivered to Lender, shall be accompanied by
the certificate of the chief financial officer of Borrower in the form
of Exhibit H.


                                   16.7          Audit Reports. Borrower shall
deliver to Lender promptly upon receipt
by Borrower thereof, copies of all audit reports, if any submitted by
Borrower’s independent certified
public accountants in connection with each annual audit of the books of Borrower.


56







                                   16.8           State
Audits. Borrower shall
deliver to Lender within twenty (20) days after it is available, any
audit report prepared by any state regulatory agency with respect to any Project.


                                   16.9           Budgets.
As soon as reasonably
available, but in no event later than thirty (30) days after the
commencement of each fiscal year of the Association for a related Project, Borrower shall submit to Lender a detailed
operating budget (broken down by month) for the upcoming fiscal year of
each such Association.


                                 
 16.10         Notices. Borrower
shall give
Lender prompt written notice of (a) any Incipient Default or Event of Default
hereunder, (b) any event which would be reasonably expected to result in a Material Adverse Change,
(c) any material loss or damage to any Project or any Amenities, (d) any
material violation by Borrower of any applicable Legal Requirements, and (e)
any breach of any material agreement adversely affecting any Project. Such
notice shall include a detailed description
of the applicable event, proceeding or loss and the actions Borrower or
its Affiliates are taking or proposes to take with respect thereto.


                                   16.11         Other
Debt. Borrower shall
notify Lender of any default under any
Debt now or hereafter owed by Borrower.


                   
              16.12    
     Sales
and Marketing Materials. Borrower shall deliver to Lender from time to time, as available
and as requested by Lender in writing, current price lists, sales literature,
registrations/consents to sell, public reports/public offering statements/prospectuses, purchase documents, and
any other items requested by Lender, which relate to the Projects or the
Vacation Club.


                                  16.13          Schedule
of Purchasers. Within thirty (30) days after the end of each calendar quarter,
Borrower shall, at Lender’s request, deliver or cause Servicer to deliver to Lender a then current list of names and addresses
of all Purchasers with Liberty Portfolio Timeshare Loans.


                                  16.14          Purposely
Omitted.


                                  16.15          Other
Information. Borrower shall, from time to time, provide Lender with such other
reasonable information and reports as Lender shall request relating to the financial condition of Borrower, or relating to
the Associations or the Projects or relating to any of the Liberty
Portfolio Timeshare Loans.


                    17.          Purposely
Omitted.


                    18.          Purposely
Omitted.


                    19.          Conditions
of and Documents to be Delivered at the Closing. The following are conditions of Closing. To the extent that the conditions
involve the delivery to Lender of any
documents or other due diligence items, such documents and items must be in form
and content acceptable to Lender in its discretion.


57







                                   19.1          Loan
Documents. Lender
shall receive all of the Loan Documents
duly executed by all parties thereto.


                                   19.2          Opinions
of Counsel. Lender shall receive an opinion of counsel for Borrower and an opinion of counsel for or an opinion of counsel
regarding the Associations in respect
of the Primary Projects covering certain issues regarding the good standing and
existence of the Associations in respect of the Primary Projects.


                                   19.3          Project
Documents. Lender shall receive a copy of each of the Project Documents for the Primary Projects and all
amendments thereto, certified as to accuracy and completeness by
Borrower or its Affiliates.


                                   19.4          Association
Documents. Lender shall receive a copy of the Articles of Incorporation and
By-Laws of the Associations and all amendments thereto.


                                   19.5          Borrower’s
Documents. Lender shall receive a copy of the Governing Documents of Borrower and all amendments thereto, certified as
to accuracy and completeness by either
an officer of Borrower or by the public official in whose office the same are recorded or filed.


                                   19.6          Good
Standing Certificates. Lender shall receive current good standing certificates issued by the secretaries of the states of its
respective formation and all other
states in which it does business, confirming the current good standing and
qualification of Borrower in such
states, unless the failure to have any such certificate would not reasonably be
expected to result in a Material Adverse Change.


                 
                19.7 
        Insurance. Lender
shall
receive certificates of insurance or policies
of insurance evidencing that all insurance required by the Declarations related
to Associations managed by the
Vacation Club Manager or this Agreement is in force and will not be
canceled without the notice as more specifically provided in and subject to Section 7.8.


                                   19.8          Flood
Insurance. If any portion of
any Project is within an area designated
by the Director of the Federal Emergency Management Agency, pursuant to the Flood Disaster Protection Act of 1973, as amended,
as one having special flood hazards, Borrower
shall deliver to Lender evidence that the buildings and other improvements
within such areas are covered by
flood insurance to the maximum limit of coverage available under the Flood Disaster
Protection Act of 1973, as amended or as may otherwise be available in the
commercial insurance market. If a Project is
not located within such a special flood hazard area, Borrower shall
provide Lender with evidence satisfactory to the Lender of such fact.


                                   19.9          Timeshare
Approvals. Lender shall receive evidence that all Timeshare Approvals for the Projects and/or the Vacation Club have been
issued or obtained, and that they remain in full force and effect.


                                   19.10        Authorizing
Resolutions. Lender shall receive a copy of the resolutions of the Board of Directors of Borrower, authorizing the
transactions contemplated hereunder
and the execution of the Loan Documents and all collateral documents on behalf
of Borrower by the officer of Borrower who is signing the Loan Documents.


58







                                   19.11          UCC-1
Financing Statements. Lender shall receive confirmation that UCC-1 financing statements naming Lender as secured party and
Borrower as debtor describing all
Collateral now or hereafter assigned by Borrower to Lender pursuant hereto have
been filed with the Secretary of State of the Commonwealth of
Massachusetts.


                                   19.12          Environmental
Matters. Lender shall receive an Environmental Agreement duly executed by Borrower or its Affiliates, together with a
copy of a Phase I environmental
report for each Primary Project. In addition, Lender shall receive evidence satisfactory to Lender of environmental remediation
or an agreement of Borrower or its Affiliates to complete remediation if
required by Lender.


                                   19.13          Purposely
Omitted.


                                   19.14          UCC-1
Search Report. Lender shall receive a current search report from a UCC search
company approved by Lender setting forth all UCC-1 filings, tax liens and judgment liens made against Borrower. Such
search report must indicate that at the time of the filing of the financing statements (Form UCC-1) in favor of Lender
there were on file no financing statements or liens evidencing a
security interest in any Collateral.


          
              
       19.15      
   Releases. Lender
shall
receive releases and satisfactions from all Persons holding liens,
claims or encumbrances against any of the Collateral.


                                   19.16          Closing
Certificates. Lender shall receive the executed closing certificate of Borrower certifying to Lender that all representations
and
warranties of Borrower in this Agreement are accurate and complete and
that Borrower has complied with all covenants and
conditions of closing set forth in this Agreement.


         
               
       19.17   
     Compliance. Lender
shall
receive evidence satisfactory to Lender that Borrower and the Primary Projects are in compliance with all Legal
Requirements in a manner that
Borrower’s failure to so comply would not be reasonably expected to result in a
Material Adverse Change.


                 
                  19.18 
       Survey. Lender
shall receive
a surveyor’s certificate together with a
copy of an as-built survey of each Primary Project satisfactory to Lender and
prepared by a licensed surveyor
showing the location and dimensions of all improvements thereon and indicating the routes of ingress and egress for
public access to the Primary Project, all utility lines, walks, drives,
recorded or visible easements and rights-of-way on the Primary Project, and showing that there are no encroachments,
improvements, projections or easements (recorded or unrecorded) on the
property lines. The survey shall certify the acreage of the applicable Primary Project and shall indicate whether the applicable
Primary Project is located within any flood hazard area. The survey must be prepared in accordance with the then-applicable
standards set forth by ALTA/ACSM
(including any Table “A” items designated by Lender), any and all applicable state surveyors’ bureaus or
associations and any and all regulations or applicable local, state and federal law.


                
                   19.19 
       Title
Report/Commitment. Lender shall receive a title insurance report or commitment for each Primary Project. The
condition of title must be satisfactory to Lender in all respects.


59







                                   19.20          Taxes
and Assessments. Lender shall receive evidence that all taxes and Assessments related to the Primary Projects (and related to
any other Project upon the request of
Lender) or for which Borrower is responsible for collection which are then due
and payable, have been paid, which
taxes and Assessments include, without limitation, real property taxes,
and any Assessments related to the Primary Projects (and related to any other
Project upon the request of Lender).


                                   19.21          Preclosing
Inspections. Lender shall have conducted and approved due diligence investigations satisfactory to Lender of Borrower
and the Primary Projects.


                    
             19.22       
   Expenses. Borrower
shall have
paid all fees and expenses required to be paid to Lender prior to or at
Closing pursuant to this Agreement.


                                  19.23           Permits
and Approvals. Lender shall receive copies of all applicable governmental
permits, approvals, consents and licenses for the Projects and satisfactory evidence that the Primary Projects
(and any other Project upon the request of Lender) and the intended uses
of the Primary Projects (and any other Project upon the request of Lender) are
and will be in compliance with all Legal Requirements. Such evidence may
include letters, licenses, permits,
certificates and other correspondence from the appropriate governmental authorities, opinions of Borrower’s
attorney or other attorneys and opinions or certifications, as Lender may determine or other confirmation acceptable
to Lender. All such approvals shall
continue to be legally valid and shall remain in full force and effect after
issuance and until the Receivables Loan is repaid in full.


                  
              19.24  
       Lockbox
Agreement. Lender shall receive an executed original of the Lockbox Agreement.


                
                19.25 
        Servicing
Agreement. Lender shall receive an executed original of the Servicing Agreement.


                                   19.26          Compliance
with Planning, Land Use and Zoning Stipulations. Borrower shall
have furnished Lender with evidence of each Primary Project’s compliance with applicable zoning, planning, land use and other
governmental requirements as Lender may require, including without limitation,
evidence satisfactory to Lender that Borrower or its Affiliates has complied with all conditions of the
zoning, planning, land use and related approvals, and has received all
permits required thereunder.


                                   19.27          Litigation
Search. Lender shall receive evidence satisfactory to Lender that no bankruptcy, foreclosure or other
material litigation or judgments are outstanding against the Primary
Projects or Borrower, except as disclosed in Borrower’s periodic filings with
the Securities and Exchange Commission.


             
             
      19.28          Trust
Agreement. Lender shall receive
a fully executed copy of the Trust Agreement and all amendments thereto.


             
             
      19.29          Other. Lender
shall receive such
other documents, opinions and items as Lender may reasonably request.


60







                    By
completing the closing hereunder, or by making advances hereunder, Lender does
not thereby waive a breach of any warranty or representation made by Borrower
hereunder or any agreement, document, or instrument delivered to Lender or
otherwise referred to herein, and
any claims and rights of Lender resulting from any breach or misrepresentation
by Borrower are specifically reserved by Lender.


                    20.          Conditions
of and Documents to be Delivered Prior
to Initial Receivables Loan Advance. In addition to, but not in limitation of, any other conditions set forth in this
Agreement, Lender’s obligation to
make the initial Receivables Loan Advance shall be subject to fulfillment of the following conditions to Lender’s
satisfaction. To the extent that the
conditions involve the delivery to Lender of any documents or other due
diligence items, such documents and items must be in form and content
acceptable to Lender in its discretion.


                                   20.1          Loan
Documents. Lender shall
receive all original executed Loan Documents.


                                   20.2          Other. Lender
and its counsel
shall receive copies of such documents and other items as Lender or such
counsel may reasonably request in connection with such requested Receivables Loan Advance.


                    21.          Conditions
of and Documents to be Delivered Prior
to Funding And in Connection With
Each Receivables Loan Advance. In addition to, but not in limitation of, any other conditions set forth in this Agreement,
Lender’s obligation to make each Receivables Loan Advance shall be
subject to fulfillment of the following conditions to Lender’s satisfaction. To the extent that the conditions involve the
delivery to Lender of any documents or other due diligence items, such documents and items must be in form and content
acceptable to Lender in its
discretion, provided that the forms of any such documents and items attached to
this Agreement shall be deemed acceptable to Lender.


                                   21.1  
      Representations;
No Defaults. The representations and warranties of Borrower contained in this Agreement
or otherwise made by or on behalf of Borrower
to Lender in connection with the transactions contemplated hereby shall have
been true and complete when made and
as of the time of each Advance. Borrower shall have fully performed and complied with all agreements and
conditions contained herein or related hereto, and no Incipient Default
or Event of Default shall have occurred.


                                   21.2          Request
for Receivables Loan Advance. Lender shall receive a Request for Receivables Loan Advance or a Request
for Supplementary Advance duly executed on behalf of Borrower with such
supporting documentation as is contemplated thereby.


                                   21.3          Approval
of Credit. Subject to the exception and limitation set forth in Section
2.2(e)(iv), Lender shall have received evidence of a FICO Score
for each Purchaser, together with a hard copy of such included with the
package of Consumer Documents delivered to
Lender.


                                   21.4          Original
Notes, Mortgages and Other Documents. Lender shall receive the
original Notes, Mortgages and other documents required under Section 2.3 for the Timeshare
Loans to be included in the Liberty Portfolio Timeshare Loans and offered as
security


61







for the requested Receivables Loan Advance, which
Mortgages shall have been duly executed, acknowledged
and recorded (or will be recorded) and shall have been assigned to Lender in
the manner required by this Agreement (as applicable) and which Notes
shall have been endorsed to the order of
Lender, as required hereunder. If any Mortgage required to be delivered by this
Section cannot be delivered because it
is in the possession of the recording officer, a copy thereof marked “True Copy of Original Forwarded
for Recording” may be delivered in lieu thereof and the original shall
be delivered promptly upon availability from the recording officer.


                                   21.5          Original
Assignments.  Lender shall receive the original Assignment by Borrower to Lender of the Timeshare
Loans to be included in the Liberty Portfolio Timeshare Loans and
offered as security for the requested Receivables Loan Advance, which shall have been duly executed on behalf of
Borrower, acknowledged and in recordable form.


                                   21.6          Title
Insurance. Subject to the
terms of Section 22.2,
Lender shall receive the original Title Insurance Policy (or a marked-up
commitment to issue such Title Insurance
Policy, if the Title Insurance Policy is not reasonably available at the time)
for each Mortgage offered as security for the requested Advance.


                                   21.7          Documents
Received and Recorded. Lender shall receive from the
Title Company or such other Person approved by Lender, telecopied confirmation
in the form of Exhibit F ,
as applicable, hereto, that:


                                                    (a)          each
Mortgage being assigned to Lender has been recorded in the Public Records (or is sent for recording pursuant to Section
21.4 above) and all fees,
costs, and other payments required in connection with such recording
have been paid;


                                                    (b)          at
the time of such recording, as applicable, such Mortgage was, of record, a first mortgage prior to and
superior in lien to all other monetary liens and encumbrances
whatsoever, other than Permitted Encumbrances;


                                                    (c)          at
the time of such recording, as applicable,
Borrower was, of record, the owner of
such Mortgage and of the Note secured thereby, free of all liens, encumbrances, prior assignments and claims of
third parties whatsoever, other than Permitted Encumbrances;


                                                    (d)          the
Title Company or such other approved Person
shall have sent to Lender, or as
otherwise directed by Lender, a copy of the recorded Assignment or will send as soon as received;


                                                    (e)          if
the Title Insurance Policy has not already been
delivered to Lender, or as otherwise
directed by Lender, the Title Company shall deliver to Lender the original Title Insurance Policy for the assigned
Mortgages as required pursuant to Section
22.2; and


                                                   
(f)          containing such other confirmations as Lender may
require.


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                              21.8          Subsequent
Legal Opinions. Borrower shall have, from time to time,
as requested by Lender, delivered to Lender, in form satisfactory to Lender,
the favorable opinion, addressed to Lender, of counsel to Borrower, selected by
Borrower and approved by Lender as to (a) the organization, standing and
authority to consummate the transactions contemplated hereby of Borrower, (b)
the compliance of the Primary Projects, Borrower and all Consumer Documents
with applicable Legal Requirements, and (c) such other matters incident to the
transactions contemplated hereby as Lender may request.


                              21.9          Advances
Do Not Constitute a Waiver. The making of any Advance
shall not constitute a waiver of any condition of Lender’s obligation to make
further Advances.


                              21.10        No
Obligation to Fund After Filed Liens. Lender shall have no obligation to make
any Advance at any time (a) that there is a claim of lien filed of record
against any Project which has not been bonded over, paid, transferred to other
security or otherwise satisfactorily discharged or is otherwise being contested
in good faith pursuant to Section 6.9
of this Agreement, or (b) that any condition precedent to such Advance has
not been met, or (c) Borrower shall have failed to comply with any material
provision of this Agreement, or (d) an Event of Default or Incipient Default
has occurred. Lender’s commitment to make Advances hereunder shall at no time be
subject to or liable to attachment or levy by any creditor of Borrower. No such
Persons are intended to be third party beneficiaries of this Agreement or any
documents or instrument related to the Receivable Loan or to have any claim or
claims in or to any undisbursed or retained Loan proceeds.


                              21.11        Other.
Lender and its counsel shall receive copies of such documents
and papers as Lender or such counsel may reasonably request in connection with
such requested Receivables Loan Advance.


                    22.     Post
Receivables Loan Advance Obligations.


                              22.1          Confirmation
of Recording. Immediately after giving to Lender the
telecopied confirmation mentioned at Section
21.7, the Custodian, or such other approved Person giving such
telecopied confirmation, shall forward to Lender the original of the written
confirmation in the form of Exhibit F.


                              22.2         
 Title Policy. If
a Title Insurance Policy is not otherwise required hereunder to be delivered
prior to such Advance, not later than the earlier to occur of (a) ninety (90)
days after the date of the applicable Assignment or (b) prior to the expiration
of the title insurance commitment in connection with such Title Insurance
Policy, if applicable, Borrower shall send or cause to be sent to Lender, or as
otherwise directed by Lender, with respect to each Timeshare Loan described in Schedule A attached to such Assignment,
a Title Insurance Policy issued by the Title Company, insuring Borrower and its
successors and assigns as the holder of a first priority mortgage, subject to
Permitted Encumbrances, encumbering the Timeshare Interest described in Schedule A of the Assignment, each of
which Title Insurance Policies shall be in an amount equal to, at least, the
unpaid principal balance of the Timeshare Loan assigned. If such Title
Insurance Policies are not delivered within such time period, Lender shall not
have any obligation to make any further Advances to Borrower in respect of the
Timeshare Loans related


63







to such delinquent Title
Insurance Policies. Notwithstanding the foregoing, in the event that Lender has
made Advances in respect of the Timeshare Loans related to such delinquent
Title Insurance Policies, Borrower shall promptly either (i) prepay an amount
equal to such Advance together with accrued interest thereon, (ii) pledge
additional Qualified Timeshare Loans as part of the Liberty Portfolio Timeshare
Loans in an amount sufficient to cure the deficiency, or (iii) prepay, in part,
and pledge additional Qualified Timeshare Loans, in part, in a total amount
sufficient to cure the deficiency.


                    23.          Conditions
to Lender’s Obligations to Advance Receivables Loan Proceeds Related to Sales
of Timeshare Interests in Projects Added to the Primary Projects. Lender
has agreed to make Advances hereunder subject to the conditions of this
Agreement with respect to Qualified Timeshare Loans related to the Qualified
Sales of Timeshare Interests in the Primary Projects listed on Schedule 1. Lender is willing to make
Advances hereunder with respect to Qualified Timeshare Loans related to
Qualified Sales of Timeshare Interests in Projects added to such Primary
Projects, subject to the fulfillment, prior to such Advance, of the following
conditions:


                                   23.1          General.
All other conditions for Advances set forth in this Agreement
shall have been fulfilled, including, without limitation, those set forth in Sections 19, 20 and 21.


                                   23.2          Inspection.
Either Lender or a third party selected and approved by
Lender shall have conducted due diligence investigations and on-site
inspections of the Projects to be added to the Primary Projects and the results
of such investigations and inspections shall be satisfactory to Lender.


                                   23.3          Insurance.
Lender shall have received evidence that the Projects to be
added to the Primary Projects are covered by insurance in amounts and with
sound and acceptable insurance companies with ratings of AM Best from A++ to
B++, unless otherwise approved by Lender, in its reasonable discretion, as set
forth in Section 13.3(a).


                                   23.4          Environmental
Matters. Lender shall have received a Phase I
environmental report for the Projects to be added to the Primary Projects which
must be in form and content acceptable to Lender.


                                   23.5          Zoning,
Access, Parking and Utilities. Lender shall have received
and approved evidence of (a) zoning of the Projects added to the Primary
Projects for timeshare use and other intended and existing uses and all
approvals required for such uses under any covenants, conditions and
restrictions, (b) adequate access to and parking for the applicable Project in
accordance with applicable Legal Requirements, and (c) current and continued
availability of utilities necessary to serve the applicable Project.


                                   23.6          Flood
Zone. Lender shall have received and approved evidence
that the Projects added to the Primary Projects are not located within a flood
prone area or, if within a flood zone, evidence that flood insurance has been
obtained.


                                   23.7          Project
Documents. Lender shall have received and approved a copy
of all marketing contracts, management contracts, service contracts, operating
agreements,


64







equipment leases, space
leases and other agreements pertaining to the Projects to be added to the
Primary Projects which are necessary for the sale, operation and intended use
of such Projects and are not otherwise required pursuant to another item in
this Agreement.


                                   23.8          Quiet
Enjoyment Rights. Lender shall have received and approved
evidence that each Owner of a Timeshare Interest within the Projects to be
added to the Primary Projects will have available to it the quiet and peaceful
enjoyment of the Timeshare Interest (including promised Amenities and necessary
easements) owned by it which cannot be disturbed so long as such Owner is not
in default of its obligations to pay the purchase price of its Timeshare
Interest, to pay Assessments to the Association and other dues or assessments
in respect of the Vacation Club, and to comply with reasonable rules and
regulations pertaining to the use of the Timeshare Interests and the rules and
regulations of the Vacation Club, including, without limitation, the Trust
Agreement.


                                   23.9          Opinions.
Borrower shall deliver to Lender a favorable opinion or
opinions from independent counsel for Borrower located in the state where the
Projects to be added to the Primary Projects are located covering local matters
in such jurisdiction.


                                   23.10        Other.
Lender shall have received and approved such other due
diligence items related to such Projects to be added to the Primary Project as
Lender may reasonably require.


                                   23.11        Approval
of Projects to be Added to the Primary Projects. During
the Receivables Loan Advance Period, Borrower may submit to Lender Projects
proposed to be included as additional part of the approved Primary Projects by
delivering (a) a complete description of the subject Projects, (b) the
documents listed in Sections 23.2 through
23.11 above with respect to the subject Projects, and (c) a
proposed replacement Schedule 1
that shall include the subject Projects, all of which must be satisfactory
in form and substance to Lender in its sole and absolute discretion. In
addition, Lender may perform a site inspection/market review with respect to
the proposed Projects to be added to the Primary Projects prior to the approval
of the proposed Projects, and Lender must be satisfied with the results of such
inspection and review. Lender will have thirty (30) days to review, and in its
sole and absolute discretion, approve or disapprove of the inclusion of the
proposed Project as being added to an approved Primary Project. If Lender
approves the proposed Project to be added to the Primary Projects, then Lender
shall execute and date the proposed Schedule
1 attached to this Agreement as set forth in the proposed Schedule 1.


                    24.          Default;
Remedies.


                                   24.1          Events
of Default. The occurrence of any one or more of the
following events shall constitute an “Event
of Default” hereunder:


                                                   (a)          Subject
to applicable grace periods set forth in this Agreement, Borrower shall fail to
pay or cause to be paid any principal, interest, fee or other sums payable
hereunder or under any of the Loan Documents on the date such payment is due,
whether on demand, at the stated maturity or due date thereof, by reason of any
requirement for prepayment thereof, by acceleration or otherwise.


65







                                                   (b)          Borrower
shall default in the observance or performance of any term, covenant or
agreement on its part to be observed or performed hereunder or under the Loan
Documents and not otherwise specifically provided for in this Section 24.1, provided that, such default
(including the Events of Default set forth in clauses p, q and r below) must, in
order to be deemed to be an Event of Default, continue unremedied for a period
of thirty (30) days after the earlier to occur of: (i) written notice from
Lender to Borrower of the existence of such default, or (ii) Borrower has
actual knowledge of such default, and further provided that,
in the event that Borrower has commenced to cure such default within the
initial thirty (30) day cure period and has been unable to complete such cure
despite their diligent best efforts within such initial thirty (30) day cure
period, then Borrower shall have an additional thirty (30) day period not to
exceed an additional ninety (90) days in which to complete such cure.
Notwithstanding the foregoing, if Lender reasonably determines that such default
is incapable of being cured or if such default involves a breach of any of the
financial covenants in Article 15 of this Agreement, then Borrower shall
not be entitled to any notice or opportunity to cure.


                                                   (c)          Any
default or event of default shall occur under any other existing or future
agreement between Borrower and Lender, and any applicable notice and/or cure
period in such agreement shall have elapsed.


                                                   (d)          Any
representation or warranty made by or on behalf of Borrower herein or in any
other writing furnished pursuant hereto or any fact relative to Borrower’s
business operations or financial condition shall be or have been false in any
material respect.


                                                   (e)          Borrower
or its Affiliates shall surrender or shall be deprived, for any reason, of the
full right, privilege and franchise to carry on its timeshare business as
presently carried on, to own and/or operate the Projects or to sell Timeshare
Interests or to make Timeshare Loans.


                                                   (f)          Borrower
shall dissolve, consolidate or cease its or its Affiliates day-to-day timeshare
business operations, or shall liquidate or commence any proceedings to be
liquidated, or shall, without the prior written consent of Lender, make any
Transfer.


                                                   (g)          Borrower
shall become insolvent or be unable to pay its debts as they mature or shall
admit in writing its inability to pay its debts as they mature.


                                                   (h)          Borrower
shall make a general assignment for the benefit of creditors.


                                                   (i)          Borrower
shall file or have filed against it a petition under any of the provisions of
any Debtor Relief Laws, for an adjudication in bankruptcy or for reorganization
or to effect a plan or other arrangement with creditors, or file an answer to a
creditor’s petition or other petition filed against it admitting the material
allegations thereof.


                                                   (j)          Borrower
shall apply for the appointment of a receiver, liquidator or trustee of any
substantial portion of its property or assets, or such a receiver, liquidator
or trustee shall be appointed without application by Borrower.


66







                                                   (k)          A
writ, warrant, attachment, levy or similar process shall be issued against (i)
any of the Collateral or (ii) against any portion of Borrower’s property or
assets in an amount in excess of $250,000 individually or $1,000,000 in the
aggregate, which is not released, expunged, discharged or dismissed within
thirty (30) days after such writ, warrant, attachment, levy or similar process
first takes effect.


                                                   (l)          The
offering for sale and the sale of Timeshare Interests, the financing of such
sale, or the consummation of the transactions contemplated hereby is found to
violate or not to comply in all respects with any Legal Requirement, where the
failure to so comply would reasonably be expected to result in a Material
Adverse Change.


                                                   (m)          There
shall occur any Material Adverse Change.


                                                   (n)          Any
material part of the Projects shall be damaged and such damage is not fully
covered by insurance or is in excess of $50,000, subject to reasonable
deductibles and not otherwise repaired.


                                                   (o)          Borrower
shall default in respect of any of its obligations for borrowed funds under a
receivables loan facility to any other Person and such default shall continue
uncured beyond any applicable notice and grace period.


                                                   (p)          The
Custodian or such other approved Person shall default in respect of any of its
obligations described in Section 22.1.


                                                   (q)          The
Lockbox Bank or the Servicer (if Borrower or its Affiliates) shall fail to
remit to Lender any proceeds of the Timeshare Loans in accordance with, as
applicable, the terms of the Lockbox Agreement or the Servicing Agreement.


                                                  (r)          Borrower
or its Affiliates, the Lockbox Bank or the Servicer (if Borrower or its
Affiliates) shall fail to perform any of their obligations under the Lockbox
Agreement or Servicing Agreement, as applicable.


                                                   (s)          Any
final, non-appealable judgment or decree for money damages or for a fine or
penalty in excess of $250,000 individually, or $1,000,000 in the aggregate is
entered against Borrower which is not paid and discharged, stayed or
transferred to a bond within thirty (30) days thereafter.


                                                   (t)          Any
party holding a lien or security interest on any part of any Project commences
foreclosure or similar sale thereof or Borrower defaults under any mortgage,
deed of trust or other lien encumbering all or any part of any Project, which,
in either case, results in a Material Adverse Change.


                                                   (u)          Borrower
shall sell, transfer or convey or further encumber all or any part of its
interest in any of the Collateral, other than in connection with a payoff of
Lender in full and a securitization or other takeout financing transactions.


                                                   (v)          Borrower
grants, permits or suffers to exist any mortgage, lien or encumbrance upon any
of the Collateral, other than in favor of Lender, other than in


67







connection with a payoff
of Lender in full and a securitization or other takeout financing transactions.


                                                   (w)          Any
violation or breach by Borrower shall occur under any agreement, covenant or
restriction materially and adversely affecting title of an Owner to a Timeshare
Interest related to a Timeshare Loan comprising part of the Liberty Portfolio
Timeshare Loans; provided that, such default must, in order to be deemed
to be an Event of Default, continue unremedied for a period of thirty (30) days
in which time Borrower may promptly either (i) prepay an amount equal to the
deficiency together with accrued interest thereon, (ii) pledge additional
Qualified Timeshare Loans as part of the Liberty Portfolio Timeshare Loans in
an amount sufficient to cure the deficiency, or (iii) prepay, in part, and
pledge additional Qualified Timeshare Loans, in part, in a total amount
sufficient to cure the deficiency.


                                                   (x)          Borrower
shall fail to prepay to Lender, pursuant to Section 5.7, all amounts owing by Borrower to Lender on
account of the Receivables Loan and all other Obligations owing by Borrower to
Lender pursuant to this Agreement, including, without limitation, the Change of
Control Fee or prepayment fee, as applicable, pursuant to Section 4.5, immediately upon
the occurrence of a Change of Control.


                                                   (y)          The
indictment of Borrower under any criminal statute, or the commencement of
criminal or civil proceedings against Borrower pursuant to which statute or
proceedings the penalties or remedies sought or available include forfeiture of
any property of Borrower, or Borrower engages or participates in any “check
kiting” activity regardless of whether a criminal investigation has been
commenced.


                                  24.2          Remedies.
At the option of Lender, upon the occurrence of an Event of
Default or at any time thereafter:


                                                   (a)          Lender
may declare all or some of the Obligations immediately due and payable;


                                                   (b)          Borrower
shall have no further right to receive any Advances hereunder;


                                                   (c)          Lender
may reduce the advance rate against Qualified Timeshare Loans;


                                                   (d)          Lender
may increase the interest rate on the Receivables Loan to the Default Rate
specified herein without further notice;


                                                   (e)          Lender
may enter any premises occupied by Borrower and take possession of the
Collateral and any records related thereto;


                                                   (f)          Lender
may request and have appointed a receiver with respect to Borrower and/or the
Collateral, and to that end, Borrower hereby consents to the appointment of a
receiver by Lender in any action initiated by Lender pursuant to this
Agreement, and Borrower waives any notice and posting of a bond in connection
therewith;


68







                                                (g)          Lender
may terminate any existing Lockbox Agreement or Servicing Agreement and
thereafter have the collection and servicing of the Timeshare Loans done by
Lender or any Person designated by Lender all in accordance with the terms and
conditions of the Lockbox Agreement and Servicing Agreement; and/or


                                                (h)          Lender
may exercise each and every right and remedy granted to it under this
Agreement, any Loan Document, under the applicable Uniform Commercial Code and
under any other applicable law, at equity or otherwise.


                    If
an Event of Default occurs under Section
24.1(g), 24.1(h), 24.1(i) or 24.(j), all Obligations
shall become immediately due and payable without further action.


                              24.3          Sale
or Other Disposition of Collateral. The sale or other
disposition of the Collateral, or any part thereof, by Lender after an Event of
Default may be for cash, credit or any combination thereof, and Lender may
purchase all or any part of the Collateral at public or, if permitted by law,
private sale, and in lieu of actual payment of such purchase price, may set-off
the amount of such purchase price against the Obligations. Any sales of the
Collateral may be adjourned from time to time with or without notice. Lender
may cause the Collateral to remain on Borrower’s premises or otherwise to be
removed and stored at premises owned by other Persons, at Borrower’s expense,
pending sale or other disposition of the Collateral. Borrower, at Lender’s request,
shall assemble the Collateral consisting of tangible assets and make such
assets available to Lender at a place to be designated by Lender. Lender shall
have the right to conduct such sales on Borrower’s premises, at Borrower’s
expense, or elsewhere, subject to applicable Legal Requirements, on such
occasion or occasions as Lender may see fit. With respect to Borrower’s owned
or leased premises, Borrower hereby grants Lender a license, effective upon the
occurrence of an Event of Default, and to the extent not prohibited by the
terms of any applicable lease, and subject to applicable Legal Requirements, to
enter into possession of such premises and to occupy the same, without charge,
in order to exercise any of Lender’s rights or remedies provided herein, at law
or in equity, or otherwise.


                    Any
notice required to be given by Lender of a sale or other disposition or other
intended action by Lender with respect to any of the Collateral which is given
in the manner specified in Section 25.1, at least ten (10) Business Days prior to such proposed action, shall
constitute fair and reasonable notice to Borrower of any such action. The net
proceeds realized by Lender upon any such sale or other disposition, after
deduction for the expenses related thereto including without limitation,
reasonable attorneys’ fees, shall be applied in such order as Lender, in its
sole discretion, elects, toward satisfaction of the Obligations. Lender shall
account to Borrower for any surplus realized upon such sale or other
disposition, and Borrower shall remain liable for any deficiency. The
commencement of any action, legal or equitable, or the rendering of any
judgment or decree for any deficiency shall not affect Lender’s security
interest in the Collateral. Borrower agrees that Lender has no obligation to
preserve rights to the Collateral against any other parties. Lender shall be
under no obligation to marshal any assets in favor of Borrower or any other
Person or against or in payment of any or all of the Obligations.


                    In
connection with the disposition of any Collateral by Lender, Borrower agrees
that Lender may disclaim any warranties and dispose of such Collateral without
any warranties


69







whatsoever and that
Lender shall not be deemed to have acted in a commercially unreasonable manner
as a result thereof.


                    If
Lender sells any of the Collateral upon credit, Borrower will be credited only
with payments actually made by or on behalf of the purchaser, received by
Lender and applied to the indebtedness owed by such purchaser to Lender. If the
purchaser fails to pay for any of the Collateral, Lender may resell the
Collateral.


                    Lender
may, in the name of Borrower or its own name, make and execute all conveyances,
assignments and transfers of the Collateral sold in connection with the
exercise of Lender’s rights and remedies; and Lender is hereby appointed
Borrower’s attorney-in-fact for this purpose.


                              24.4          Application
of Proceeds. All proceeds from each sale of, or other
realization upon, all or any part of the Collateral following an Event of
Default shall be applied or paid over as follows:


                                               (a)          First:
to the payment of all costs and expenses incurred in connection with such sale
or other realization, including reasonable attorneys’ fees; and


                                               (b)          Second:
to the payment of the Obligations (with Borrower remaining liable for any
deficiency) in such order as Lender may elect; and


                                               (c)          Third:
the balance (if any) of such proceeds shall be paid, subject to any duty
imposed by law, or otherwise to whomsoever shall be entitled thereto.


                              24.5          Actions
with Respect to Timeshare Loans. Lender may take any of
the following actions, in its name or the name of Borrower, as Lender may
determine, without notice to Borrower and at Borrower’s expense:


                                               (a)          Verify
the validity and amount of or any other matter relating to the Liberty
Portfolio Timeshare Loans, by mail, telephone, telegraph or otherwise:


                                               (b)          Direct
all Purchasers to make payment of all Liberty Portfolio Timeshare Loans
directly to Lender or a Person designated by Lender, forward invoices directly
to such Purchasers and receive and collect all monies due or to become due with
respect to such Liberty Portfolio Timeshare Loans;


                                               (c)          Take
control in any manner of any cash or non-cash items of payment or proceeds of
the Liberty Portfolio Timeshare Loans; and


                                               (d)          At
any time after an Event of Default occurs and while such Event of Default
continues, enforce payment of and collect any of the Liberty Portfolio
Timeshare Loans assigned to Lender pursuant to this Agreement, by legal
proceedings or otherwise, and for such purpose, Lender may:


                                                              (i)          Demand
payment of any of such Liberty Portfolio Timeshare Loans, subject to the terms
thereof;


70







                                                              (ii)          Settle,
adjust, compromise, extend, renew, discharge or release any of the Liberty
Portfolio Timeshare Loans;


                                                              (iii)          Sell
or assign any of the Liberty Portfolio Timeshare Loans on such terms, for such
amount and at such times as Lender deems advisable;


                                                              (iv)          Prepare,
file and sign Borrower’s name on any proof of claim or similar document in any
proceeding filed under any Debtor Relief Laws as to any of the Liberty
Portfolio Timeshare Loans;


                                                              (v)          Endorse
the name of Borrower upon any documents, instruments or similar documents or
agreements relating to the Liberty Portfolio Timeshare Loans or upon any checks
or other media of payment that may come into Lender’s possession; or


                                                              (vi)          Take
all other actions necessary or desirable to protect Lender’s interest in the
Liberty Portfolio Timeshare Loans.


                    Borrower
hereby makes, constitutes and appoints Lender (and any of Lender’s designated
officers, employees or agents) as its true and lawful attorney-in-fact, with
full power of substitution, with power to sign its name and to take any of the
foregoing actions, in its name or the name of Lender, which power is coupled
with an interest and is irrevocable. All acts of Lender taken in connection
with the foregoing are hereby ratified and approved and Lender shall not be
liable for any acts of commission or omission, nor for any error of judgment or
mistake of fact or law, except gross negligence or willful misconduct. Borrower
agrees to assist Lender in the collection and enforcement of the Liberty
Portfolio Timeshare Loans and not to hinder, delay or impede Lender in its
collection or enforcement of the Liberty Portfolio Timeshare Loans.


                              24.6          Retention
of Collateral. At its discretion, Lender may retain all
or part of the Collateral in partial or full satisfaction of the Obligations to
the extent permitted by applicable law. Lender will not be considered to have
offered to retain the Collateral in satisfaction of the Obligations, unless
Lender has entered into a written agreement with Borrower to that effect.


                              24.7          Performance
by Lender. In the event that
Borrower fails to perform any obligations under any of the Loan Documents, the
Project Documents or the Consumer Documents, Lender may perform such obligations
and Borrower agrees to reimburse Lender for all funds expended by Lender and
all costs related thereto. If Borrower does not reimburse Lender within five
(5) Business Days after demand by Lender, interest shall accrue on such
reimbursement obligations at the Default Rate. In no event shall Lender have
any obligation to perform any obligations of Borrower under the Loan Documents,
the Project Documents or the Consumer Documents. Such performance shall be
totally discretionary with Lender and performance by Lender at any time shall
not give rise to any duty or obligation by Lender to perform at any other time.


                              24.8          No
Liability of Lender. Neither the acceptance of this Agreement
by Lender, nor the exercise of any rights hereunder by Lender, shall be
construed in any way as an assumption by Lender of any obligations,
responsibilities or duties of Borrower arising in


71







connection with the
Projects, under any applicable Timeshare Act or under any of the Project Documents,
or in connection with any other business of Borrower, or the Collateral, or
otherwise bind Lender to the performance of any obligations with respect to the
Project or the Collateral. Lender shall not be obligated to perform, observe or
discharge any obligation, responsibility, duty, or liability of Borrower with
respect to the Projects or any of the Collateral, under any applicable
Timeshare Act or under any of the Project Documents. This Agreement, any action
or actions on the part of Lender taken hereunder, and any exercise of rights or
remedies by Lender prior to or following the occurrence of an Event of Default
shall not constitute an assumption by Lender of any obligations of Borrower
with respect to the Projects, the Collateral, and Borrower shall continue to be
liable for all of their obligations thereunder or with respect thereto.


                              24.9          Right
to Defend Action Affecting Collateral. Lender may, at
Borrower’s expense, appear in and defend any action or proceeding at law or in
equity which Lender in good faith believes may affect the value of the
Collateral, the Projects or Lender’s rights under any of the Loan Documents.


                              24.10          Delegation
of Duties and Rights. Lender may execute any of its
duties and/or exercise any of its rights or remedies under the Loan Documents
by or through its officers, directors, employees, attorneys, agents,
representatives or through other Persons. Lender may use Wellington Financial
to perform certain services in connection with the transactions contemplated
under the Loan Documents. Lender may pay Wellington Financial or any other
Persons performing services for Lender such compensation as Lender may elect.


                              24.11          Condemnation
or Litigation. Lender shall have no obligation to make
any Advances if any condemnation proceeding or litigation is pending against
any Unit or the applicable Primary Project or against Borrower, which would in
any material way impair any Primary Project.


                              24.12          Set-Off.
Without limiting the rights of Lender under applicable law,
Lender has and may exercise a right of set-off, a lien against and a security
interest in all property of Borrower now or at any time in Lender’s possession
in any capacity whatsoever, including but not limited to any balance of any
deposit, trust or agency account, or any other bank account with Lender, as
security for all Obligations. At any time and from time to time following the
occurrence of an Event of Default, or an event which with the giving of notice
or passage of time or both would constitute an Event of Default, Lender may
without notice or demand, set off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by Lender to or for the credit of Borrower
against any or all of the Obligations.


                              24.13          Waiver
of Right of First Refusal. Borrower (on behalf of itself
and its Affiliates) hereby irrevocably waives any right of first refusal it may
have to purchase Timeshare Interests (including without limitation the right of
first refusal contained in any Declaration in favor of Borrower or its Affiliates,
as declarant or otherwise) with respect to any Timeshare Interests acquired by
Lender, or its nominee or assignee. Borrower agrees that thereafter such
Timeshare Interests may be assigned, transferred or sold free and clear of any
right of first refusal in favor of Borrower.


72







                    25.          Miscellaneous.


                                   25.1          Notices.
All notices, requests and demands to be made hereunder to the parties hereto must be in writing (at the
addresses set forth below) and may be given by any of the following
means:


                                                    (a)          personal
delivery;


                                                    (b)          reputable
overnight courier service;


                                                    (c)          electronic
communication, whether by telex, telegram
or telecopying (if confirmed in writing sent by registered or certified,
first class mail, return receipt requested); or


                                                    (d)          registered
or certified, first class mail, return receipt requested.


                    Any
notice, demand or request sent pursuant to the terms of this Agreement will be
deemed received (i) if sent pursuant subsection (a), upon such personal
delivery, (ii) if sent pursuant to subsection (b) on the next Business Day
following delivery to the courier service, (iii) if sent pursuant to subsection (c) upon dispatch if such
dispatch occurs between the hours of 9:00
a.m. and 5:00 p.m. (recipient’s time zone) on a Business Day, and if such
dispatch occurs other than during such
hours, on the next Business Day following dispatch and (iv) if sent pursuant
to subsection (d) three (3) days
following deposit in the mail with all postage paid.


	
 

	
 

	
 


	
 

	
If to Lender:

	
Liberty Bank


	
 

	
 

	
291 Main Street 


	
 

	
 

	
Middletown, CT 06457 


	
 

	
 

	
Attention: Donald Peruta

 Telephone No.: (860) 638-2916

 Telecopier No.: (860) 344-9217


	
 

	
 

	
 


	
 

	
If to Borrower:

	
Bluegreen Corporation


	
 

	
 

	
4960 Conference Way North,
 Suite 100

 Boca Raton, Florida 33431 


	
 

	
 

	
Attention: Anthony M. Puleo

 Telephone No.: (561) 912-8270

 Telecopier No.: (561) 912-8123


	
 

	
 

	
 


	
 

	
With courtesy

	
Bluegreen Corporation


	
 

	
copies to:

	
4960 Conference Way North, Suite 100


	
 

	
 

	
Boca Raton, Florida 33431


	
 

	
 

	
Attention: General Counsel


	
 

	
 

	
Telephone No.: (561) 912-8012


	
 

	
 

	
Telecopier No.: (561) 912-8299





                    The
addresses and addressees for the purpose of this Section may be changed by
giving written notice of such change in the manner herein provided for giving
notice. Unless and


73







until such written notice
of a change of address or addressee is received, the last address and
addressee, as stated by written notice, or provided herein if no written notice
of change has been sent or received, shall be deemed to continue in effect for
all purposes hereunder.


                                   25.2          Borrower’s
Representative. Borrower
hereby designates the following
natural persons as the representatives of Borrower for purposes of (a) making
all decisions with respect to the
Receivables Loan and the Loan Documents, (b) delivering all notices,
certificates, requests for advance and other documents required by the terms of
the Loan Documents or requested by Borrower
in connection with the Loan, and (c) taking all other actions requested by Borrower in connection with
the Receivables Loan and the Loan Documents:


	
 

	
 


	
 

	
Anthony M. Puleo, Senior Vice President, CFO


	
 

	
and Treasurer


	
 

	
Bluegreen Corporation


	
 

	
4960 Conference Way North, Suite 100


	
 

	
Boca Raton, Florida 33431


	
 

	
Telephone No.: (561) 912-8270


	
 

	
Telecopier No.: (561) 912-8123


	
 

	
 


	
 

	
Allan J. Herz, Senior Vice President, Mortgage


	
 

	
Operations and Assistant Treasurer


	
 

	
Bluegreen Corporation


	
 

	
4960 Conference Way North, Suite 100


	
 

	
Boca Raton, Florida 33431


	
 

	
Telephone No.: (561) 912-8210


	
 

	
Telecopier No.: (561) 443-8743





In
taking action pursuant to the terms of this Agreement and the other Loan
Documents, the Lender shall be entitled to rely, without further
investigation, upon any notice, certificate, request for advance or other document delivered in writing and executed or
signed by such representative of Borrower. In addition, the Lender may,
at its option, refuse to take action in the event
a notice, certificate, request for advance or other document is delivered to
Lender which has not been executed or delivered by such representative
of Borrower.


                                   25.3          Binding
Effect; Assignment. This
Agreement shall bind and inure to the
benefit of the parties hereto and their respective successors and assigns;
provided, however, that Borrower shall
not assign its rights or obligations under this Agreement, without Lender’s
prior written consent.


                                   25.4          No
Waiver. No delay or
omission to exercise any right, power or remedy accruing to Lender upon any
breach or default of Borrower under this Agreement shall impair any such
right, power or remedy of Lender, nor shall it be construed to be a waiver of
any such breach or default thereafter
occurring, nor shall any waiver of any single breach or default theretofore occurring be deemed a waiver of any
other breach or default. Any waiver, permit, consent or approval of any kind under this Agreement, or any waiver on
the part of Lender of


74







any provision or
condition of this Agreement must be in writing and shall be effective only to
the extent specifically set forth in such writing.


                                   25.5          Remedies
Cumulative. All remedies
either under this Agreement, by law, or otherwise afforded to Lender, shall be
cumulative and not alternative.


                                   25.6          Costs,
Fees and Expenses.


                                                    (a)          Loan
Documents. Borrower agrees to pay
the following:


                                                                   (i)          all
costs and expenses of Lender in connection with (A) the preparation,
review, negotiation, execution, delivery and administration of the Loan
Documents, and the other documents to be delivered in connection therewith, or
any waivers, consents, amendments, extensions and increases to any of the
foregoing, (B) the preparation for, negotiations
regarding, consultations concerning, or the defense or prosecution of legal proceedings involving any claims made or
threatened against Lender arising out of or related to the Loan
Documents, the transactions contemplated hereunder and the protection of any of
the Collateral, or (C) after the occurrence
and during the continuation of an Event of Default, obtaining any
appraisals or reappraisals of Collateral, periodic lien searches and tax
clearance certificates, as Lender in its discretion may require (including in
all cases, without limitation, reasonable
attorneys’ fees and expenses);


                                                                   
(ii)          all
losses, costs and expenses of Lender and its participants in connection
with the interpretation, enforcement, protection and preservation of Lender’s
rights or remedies under the Loan Documents, or any other agreement relating to
any of the Obligations, or in connection with
legal advice relating to the rights or responsibilities of Lender (including without limitation court costs,
reasonable attorneys’ fees, expenses of accountants and appraiser and
the cost of all appeals); and


                                                                   (iii)          any
and all stamp and other taxes payable or determined
to be payable in connection with the execution and delivery of the Loan
Documents, and all liabilities to which
Lender may become subject as the result of delay in paying or omission
to pay such taxes.


                                                    (b)          Recording;
Etc. Borrower agrees to pay
all costs, expenses and fees of Lender
and its participants related to the Loans, the transactions contemplated
hereunder and the exercise by Lender of its rights and remedies, including
without limitation, costs and expenses
incurred or paid by Lender and its participants for photocopying; notarization;
couriers; messengers; telecommunications; public record searches (including without
limitation, real estate, tax lien, litigation, UCC or bankruptcy searches);
filing; recording; publication; appraisals of Collateral upon the occurrence
and during the continuance of an Event of
Default; real estate surveys; real estate title insurance reports, commitments,
policies and endorsements; environmental audits or surveys; and
accounting or other professional advisors.


                                                    (c)          Attorneys’
Fees. Borrower agrees to pay all
reasonable attorneys’ fees and the
costs and disbursements of any outside attorney or paralegal engaged by Lender and its participants in connection with (i)
advising, structuring, drafting, preparing, reviewing, negotiating,
administering the Loan Documents or any waivers, consents,


75







amendments,
extensions, modifications or restatements related thereto; (ii) interpreting, enforcing,
protecting, preserving, defending or terminating any of the Loan Documents or
any of Lender’s rights and remedies related thereto, irrespective of whether
suit is brought (including without
limitation, all costs and expenses and reasonable attorneys’ fees related to
any “workout,” “restructuring,”
insolvency or similar proceeding involving Borrower); (iii) legal advice relating to the rights and responsibilities
of Lender in connection with the Loan Documents;
(iv) the preparation for negotiations regarding, consultations concerning or
the defense or prosecution of any legal proceedings involving, any claim
(including third-party claims) made or threatened against Lender and its
participants related to or involving the Loan Documents,
the transactions contemplated under the Loan Documents, Lender’s relationship with
Borrower; or (v) any actions taken pursuant to the Loan Documents by Lender.


                                                    (d)          Protection
of Security, Etc. Borrower
agrees to pay all costs and expenses,
including reasonable attorneys’ and paralegals’ fees incurred by Lender and its participants in protecting, maintaining,
preserving or enforcing this Agreement or any other Loan Document or any of the Timeshare Loans in
defending or prosecuting any action or proceeding arising out of or
relating to Lender’s transactions with Borrower, or in exercising any of its
rights hereunder, or under any of the Loan Documents or under applicable law.


                                                    (e)          Lockbox
Bank; Servicer; Custodian. Borrower agrees to pay all costs and expenses relating to the
servicing of the Timeshare Loans, including without limitation all sums payable to the Lockbox Bank
and Servicer, all in accordance with, as applicable, the terms of the Lockbox Agreement and the Servicing
Agreement and any costs, expenses and
reasonable fees charged by Lender in the event Lender services such Timeshare Loans,
and the costs, expenses and fees of any other such Lockbox Bank, Servicer or
Custodian.


                                                    (f)          Sales
and Marketing. Borrower
agrees that it or its Affiliates shall pay all costs and expenses related to
the sales and marketing of Timeshare Interests,
and all reasonable sums payable to any of Borrower or its Affiliates engaged by
or for Lender to sell Timeshare Interests after an Event of Default.


                                                    (g)          Audit
and Inspection. Borrower
agrees to pay all reasonable costs and
expenses incurred by Lender and its participants in connection with any inspections of the Primary Projects or the Units or
any audit of Borrower or any of its business activities; provided, however,
unless an Incipient Default or an Event of Default has occurred, Borrower shall
not be responsible to pay for any costs or expenses incurred in connection with
any such inspections or audits more often than once every calendar year.


                                                    (h)          Reimbursement.
In the event that Borrower fails to perform any obligations under any of the Loan
Documents, Lender may perform such obligations and Borrower agrees to
reimburse Lender for all funds expended by Lender and all costs related thereto. If Borrower does not
reimburse Lender within ten (10) days after demand by Lender, interest
shall accrue on such reimbursement obligations at the Default Rate.


                                                    (i)          Payment.
Borrower irrevocably authorizes
Lender to pay all costs, expenses, fees, reimbursement obligations and
other sums payable to Lender and its participants under this Agreement or any
of the Loan Documents out of any Advances under the


76







Receivables
Loan or as an Advance under the Receivables Loan without the requirement for a Request
for Advance form.


                                                    (j)          Survival.
Borrower’s obligations under this Section shall survive
termination of this Agreement and repayment of the Receivables Loan.


                                   25.7          No
Other Agreements. All
understandings and agreements heretofore had between the parties respecting the
transactions contemplated by this Agreement are merged in this Agreement and the Loan Documents and there are no
other agreements, written or oral,
and no customs or usages applicable to any provision of this Agreement. In the event
of any inconsistency between the terms of this Agreement and the terms of the
other Loan Documents, the terms of this Agreement shall prevail.


                                   25.8          Amendments.
No change in or addition
to, or waiver of, any provision of
this Agreement shall be valid unless in writing and signed on behalf of the
party against whom such change, addition or waiver is sought to be
enforced.


                                   25.9          Survival
of Covenants, Agreements, Representations and Warranties. All
warranties, representations, covenants and indemnities made by Borrower herein or in any certificate or other instrument
delivered by it or on its behalf under this Agreement: (a) shall be considered to have been relied upon by Lender
and shall survive the Closing, termination of this Agreement and repayment of
the Receivables Loan, regardless of any
investigation made by Lender or on its behalf, (b) are material and being
relied upon by Lender, and (c) are
true in all respects as of the date hereof and shall be true in all respects at
all times hereafter (unless such representations and warranties pertain
to an earlier time period). All statements in any such certificate or other
instrument shall constitute warranties and representations by Borrower
hereunder.


                                   25.10          Governing
Law. THIS AGREEMENT AND ALL TRANSACTIONS
CONTEMPLATED HEREUNDER, AND ALL THE RIGHTS OF THE PARTIES SHALL BE GOVERNED AS TO THE VALIDITY,
INTERPRETATION, CONSTRUCTION,
ENFORCEMENT AND IN ALL OTHER RESPECTS BY THE LAW OF THE STATE OF CONNECTICUT, THE PRIMARY PLACE OF BUSINESS OF LENDER,
WITHOUT REGARD TO ITS RULES AND PRINCIPLES REGARDING CONFLICTS OF LAWS OR ANY RULE OR CANON OF
CONSTRUCTION WHICH INTERPRETS
AGREEMENTS AGAINST THE DRAFTSMAN.


                                   25.11          Limitation
of Liability. Borrower shall be
responsible for and Lender is hereby released from any claim or
liability in connection with:


                                                      (a)          safekeeping
any Collateral;


                                                      (b)          any
loss or damage to any Collateral;


                                                      (c)          any
diminution in value of the Collateral not resulting from the gross negligence
or willful misconduct of Lender; or


77







                                                      (d)          any
act or default of another Person not resulting from the gross negligence
or willful misconduct of Lender.


                    Lender
shall only be liable for any act or omission on its part constituting gross negligence or willful misconduct. In the event
Borrower brings suit against Lender in connection with the transactions
contemplated hereunder and Lender is found not to be liable, Borrower agrees to
indemnify and hold Lender harmless from all costs and expenses, including reasonable attorneys’ fees, incurred by Lender in
connection with such suit. This Agreement is not intended to obligate Lender to take any action with respect to the
Collateral or to incur expenses or
perform any obligation or duty of Borrower. Borrower’s obligations under this Section
shall survive termination of this Agreement and repayment of the Receivables
Loan.


                                   25.12          Submission
to Jurisdiction. Borrower
consents to the non­ exclusive
jurisdiction of any state or federal court located within the State of
Connecticut and irrevocably agree
that, subject to Lender’s election, all actions or proceedings relating to the Loan
Documents or the transactions contemplated hereunder shall be litigated in such
courts, and Borrower waives any objection
which they may have based on lack of personal jurisdiction, improper venue or forum non conveniens to the
conduct of any proceeding in any such court. Nothing contained in this
Agreement shall affect the right of Lender to serve legal process in any other manner permitted by law or affect the right
of Lender to bring any action or proceeding against Borrower or its
property in the courts of any other jurisdiction.


                                   25.13          Service
of Process. BORROWER HEREBY WAIVES PERSONAL SERVICE OF ANY SUMMONS AND COMPLAINT IN
CONNECTION WITH ANY PROCEEDINGS
ARISING OUT OF THIS AGREEMENT, OR OTHER PROCESS OR PAPERS ISSUED THEREIN, AND AGREES THAT SERVICE OF SUCH SUMMONS AND COMPLAINT OR
OTHER PROCESS OR PAPERS
MAY BE MADE BY REGISTERED OR
CERTIFIED MAIL ADDRESSED TO BORROWER AT THE ADDRESS TO WHICH NOTICES ARE TO BE SENT PURSUANT TO SECTION 25.1. BORROWER WAIVES ANY
CLAIM THAT CONNECTICUT IS AN
INCONVENIENT FORUM OR AN IMPROPER
FORUM BASED ON LACK OF VENUE. SHOULD BORROWER,
AFTER BEING SO SERVED, FAIL TO APPEAR OR ANSWER TO ANY SUMMONS, COMPLAINT, PROCESS OR PAPERS SO SERVED
WITHIN THE NUMBER OF DAYS PRESCRIBED
BY LAW AFTER THE MAILING THEREOF, BORROWER
SHALL BE DEEMED IN DEFAULT AND AN ORDER AND/OR JUDGMENT MAY BE ENTERED BY LENDER AGAINST BORROWER AS DEMANDED OR PRAYED FOR IN SUCH
SUMMONS, COMPLAINT,
PROCESS OR PAPERS.


                                   25.14          Use
of Name. Borrower shall not,
without the prior written consent of
Lender, use the name of Lender in connection with any of its business
activities, except in connection with
internal business matters and as required in dealings with governmental
agencies and other financial institutions and as may otherwise be required
pursuant to applicable Legal Requirements or
in a press release with respect to the Receivables Loan. Upon the
consent of Borrower, Lender may use the name of Borrower and any of its
Affiliates in any press release,
advertisement or other promotional materials issued with respect to the Receivables
Loan.


78







                                   25.15          Headings;
References to “Exhibits” or to
“Sections”. Section headings have been inserted in this
Agreement as a matter of convenience of reference only, and are not a part of this Agreement and shall not be
used in the interpretation of this Agreement. References herein to a “Section” or an “Exhibit” without further
attribution shall be deemed to refer
to sections or exhibits, as the case may be, of or to this Agreement. All
Schedules and Exhibits referred to
herein or attached hereto shall be deemed to be incorporated herein for all purposes.


                                   25.16          Partial
Invalidity. If
any term, provision, covenant or condition of this Agreement, or any
application thereof, should be held by a court of competent jurisdiction to be invalid, void or enforceable, all terms,
provisions, covenants and conditions of this Agreement, and all
applications thereof, not held invalid, void or unenforceable shall continue in
full force and effect and shall in no way be
affected, impaired or invalidated thereby, provided that the invalidity,
voidness or unenforceability of such term, provision, covenant or condition (after giving effect to the next sentence in this
Section) does not materially impair the ability of the parties to
consummate the transactions contemplated hereby. In lieu of such invalid, void
or unenforceable term, provision, covenant
or condition there shall be added to this Agreement a term, provision,
covenant or condition that is valid, not void and enforceable and is as similar
to such invalid, void or enforceable term, provision, covenant or condition as
may be possible.


                                   25.17          Waiver
in Legal Actions. In connection with any proceedings under this
Agreement or the documents collateral hereto or the transactions contemplated hereunder, Borrower irrevocably waives:


                                                      (a)          All
procedural errors, defects and imperfections in
such proceedings;


                                                      (b)          Any
requirement of bonds, and any surety or
security relating thereto, required by any
statute, court rule or otherwise as incident to such possession;


                                                      (c)          Demand,
presentment and protest, notice of demand,
presentment or protest of the
Receivables Loan Note or any other Loan Document;


                                                      (d)          The
benefit of any valuation, appraisal and
exemption law;


                                                      (e)          Any
right to subrogation, reimbursement,
contribution or indemnity; and


                                                      (f)          Any
right to require Lender to marshal any assets
of Borrower or any other Person.


                                   25.18          Sale;
Participations; Delegations of Duties. Borrower acknowledges and agrees that Lender shall have the right, without notice
to or consent of Borrower, to sell participation interests in the
Advances made hereunder or the Receivables Loan in whole or in part to other Persons and that Lender may delegate to
other Persons performance of certain
obligations of Lender under this Agreement. In connection therewith, Lender may


79







make
available to any prospective purchaser, assignee, participant or other Person,
any information in its possession
regarding Borrower, the Project or the Vacation Club so long as such
information is provided in accordance with the terms and conditions of a
confidentiality agreement in form and content acceptable to Lender and
Borrower. In the event that Lender participates or sells its interest in the
Receivables Loan to any other Person, Lender shall have no further
responsibilities or liabilities in connection with the sold or participated
portion of the Receivables Loan, including
without limitation the obligation to fund Advances related to such sold or participated portions, after the date of
such sale or participation. All of such responsibilities and liabilities
after the date of such sale shall be those of the participant or the purchaser of Lender’s interest.


                                   25.19          Indemnification.
Borrower agrees to
indemnify Lender and all participants, their successors, assigns, shareholders,
officers, directors, employees and agents (each an “Indemnified Party”)
against any damage, loss or expense (including reasonable attorneys’
fees and court costs) awarded against or paid, incurred or suffered by any
Indemnified Party as a result of proceedings,
actions, claims, counterclaims, fines or penalties arising out of or resulting from (a) any act or omission of
Borrower or any of its respective Affiliates, employees, contractors or agents, (b) any violation of or noncompliance
by Borrower or its Affiliates with any
Legal Requirement, (c) the breach by Borrower of any covenant, warranty, term or provision of this Agreement or any Loan
Document, or (d) any misrepresentation by Borrower in respect of any aspect of the transactions contemplated by
this Agreement unless in the case of
any of the foregoing clauses (a)-(d), such damage, loss or expense results from
the gross negligence or willful misconduct of any Indemnified Party.


          In
the event Borrower shall fail to pay taxes, insurance, Assessments, costs or expenses
which it is required to pay hereunder, or fail to keep the Collateral free from
security interests or lien or fail to maintain or repair the Projects as
required hereby, or otherwise breach any obligation hereunder, Lender in its
discretion, may make expenditures for such purposes and the amount so expended
(including reasonable attorneys’ fees and expenses, filing fees and other charges) shall be payable by Borrower on demand.
With respect to any amount required to be paid by Borrower under this
Section, in the event Borrower fails to pay such amount on demand, Borrower
shall also pay to Lender interest thereon at the Default Rate.


          Borrower
agrees to indemnify and hold harmless, each Indemnified Party, from and against
any and all claims, liabilities, losses, damages, costs and expenses (whether
or not such Person is a party to any litigation), including reasonable
attorneys’ fees and costs and costs of investigation, document
production, attendance at depositions or other discovery with respect to or arising out of this Agreement, any of the
Loan Documents, the use of any proceeds advanced hereunder, the
transactions contemplated hereunder, or any claim, demand, action or cause of
action being asserted against Borrower, unless resulting from the gross
negligence or willful misconduct of such Indemnified Party.


          Borrower’s
obligations under this Section shall survive termination of this Agreement
and repayment of the Receivables Loan.


                                   25.20          Brokers;
Payment of Commissions. Borrower
represents and warrants to Lender that no consultant, advisor, broker,
agent, finder or intermediary has acted on


80







its
behalf in connection with the negotiation of this Agreement or the consummation
of the transactions contemplated hereby. Borrower agrees to pay the
compensation, if any, due to any Person claiming any commission or finder’s fee
or other compensation as a result of any actions by such Person for or on
behalf of Borrower. Lender represents and warrants to Borrower that Wellington Financial is the only party that has
acted as a consultant, advisor, broker, agent, finder or intermediary on
its behalf in connection with the transactions contemplated hereunder. Lender agrees that it shall pay Wellington
Financial such fees or other compensation in connection with the
transactions contemplated hereunder, as may be due to Wellington Financial and
agrees to hold Borrower harmless from any claims, losses or expenses resulting
therefrom.


                                   25.21          Counterparts;
Facsimile Signatures. This
Agreement and any other Loan Document
may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed to be an
original without the production of any other counterpart. Any signature
on any Loan Document or any document collateral thereto, delivered by Borrower
by facsimile transmission shall be deemed to be an original signature thereto.


                                   25.22          Consents,
Approvals and Discretion. Unless
expressly indicated otherwise, whenever Lender’s consent or approval is
required or permitted, or any documents or other items are required to
be acceptable to Lender, such consent, approval or acceptability shall be at
the sole and absolute discretion of Lender. Unless expressly indicated
otherwise, whenever any determination or act
is at Lender’s discretion, such determination or act shall be at Lender’s sole
and absolute discretion.


                                   25.23          Control
of Association. Notwithstanding
anything herein or elsewhere to the
contrary, to the extent that Borrower agrees to cause any Association to take
or refrain from taking any action, such agreement shall only apply with respect
to any Association if Borrower or any of its Affiliates has direct or indirect
control of any Association at such time or if such Association is
managed by the Vacation Club Manager.


                                   25.24          No
Joint Venture. Nothing contained herein
is intended to permit or authorize
Borrower to make any contract on behalf of Lender, nor shall this Agreement nor
any of the documents collateral hereto
be construed as creating a partnership or joint venture with Lender. Borrower shall indemnify and hold
Lender harmless from any damages and expenses resulting from such a
construction or any assertion thereof unless any such damages or expenses arise from the willful misconduct or gross
negligence of Lender. Lender does not hereby
assume and shall have no responsibility, obligation or liability to any
Purchaser or other Person, Lender’s relationship being that only of a
creditor who has taken, as security for the Obligations, the liens and security
interests in the Collateral.


                                   25.25          All
Powers Coupled With Interest. All
powers of attorney and other
authorizations granted to Lender and any Persons designated by Lender pursuant
to any provisions of this Agreement or any of the other Loan Documents
shall be deemed coupled with an interest and
shall be irrevocable so long as any of the Obligations remain unpaid or unsatisfied.


                                   25.26          Time
of the Essence. Time
is of the essence in the performance by Borrower of all its obligations
hereunder.


81







                                   25.27          No
Third Party Beneficiaries. The
rights and benefits of this Agreement and the Loan Documents shall not
inure to the benefit of any third party.


                                   25.28          Directly
or Indirectly. Where
any provision in the Agreement refers
to action to be taken by any Person, or which such Person is prohibited from
taking, such provisions shall be applicable whether such action is taken
directly or indirectly by such Person.


                                   25.29          Dealing
With Multiple Borrowers. If
more than one Person is named as a
Borrower hereunder, all obligations, representations, warranties, covenants and
indemnities set forth in the Loan
Documents to which such Person is a party, shall be joint and several. Lender shall have the right to deal with
any individual Borrower with respect to all matters concerning the rights and obligations of Lender hereunder and
with respect to the transactions contemplated
under the Loan Documents. All actions or inactions of the officers, managers,
members and/or agents of any Borrower with respect to the transactions
contemplated under the Loan Documents shall
be deemed to be with full authority and binding upon all Borrowers. Borrower hereby appoints each other
Borrower as its true and lawful attorney-in-fact, with full right and power, for purposes of exercising all rights
of such Person under the Loan
Documents and under applicable law with respect to the transactions
contemplated under the Loan Documents.
The foregoing is a material inducement to the agreement of Lender to enter
into this Agreement and to consummate the transactions contemplated hereby.


                                   25.30          Limitation
on Damages. Borrower agrees that, in any action, suit or
proceeding, in respect of or arising out of this Agreement, the Loan Documents
or the transactions contemplated
hereunder, whether sounding in contract or tort, each waives to the fullest extent permitted by law, any
claim they may have against Lender for consequential,
punitive or special damages.


                                   25.31          Confidentiality.
Borrower and Lender shall mutually agree on the contents of any press release, public announcement or other public
disclosure regarding this Agreement and the transactions contemplated
hereunder to made following the mutual execution and delivery of this
Agreement; provided that, (a) Lender may disclose the terms hereof and
give copies of the Loan Documents to
assignees and participants and to prospective assignees and participants and (b) Borrower may disclose the
terms hereof in its periodic filings with the Securities and Exchange Commission. If either party fails to respond to
the other party in writing with either an approval or a disapproval
within five (5) Business Days of a party’s receipt of the other party’s request for consent or approval as expressly
contemplated pursuant to this Section
25.31, then such consent or approval will be deemed to have been given,
provided that such five (5) Business
Day period will not commence to run unless and until the other party has received all information, materials, documents and
other matters required to be submitted to it hereunder, with respect to such consent or approval and all other
information, materials, documents and other matters reasonably essential
to its decision process.


                                   25.32          Commercial
Transaction. BORROWER ACKNOWLEDGES THAT THIS IS A “COMMERCIAL TRANSACTION” AS SUCH IS
DEFINED IN CHAPTER 903a OF THE
CONNECTICUT GENERAL STATUTES, AS AMENDED. BORROWER FURTHER ACKNOWLEDGES THAT, PURSUANT TO SUCH SECTION, IT HAS A RIGHT TO NOTICE OF
AND HEARING PRIOR TO
THE ISSUANCE OF


82







ANY “PREJUDGMENT REMEDY”. NOTWITHSTANDING THE
FOREGOING, BORROWER HEREBY WAIVES ALL RIGHTS TO SUCH NOTICE, JUDICIAL HEARING
OR PRIOR COURT ORDER IN CONNECTION WITH ANY SUIT ON THIS AGREEMENT, THE
RECEIVABLES LOAN NOTE ANY OF THE LOAN DOCUMENTS OR ANY EXTENSIONS OR RENEWALS
OF THE SAME.


                              25.33
Waiver of Right to Trial by Jury. BORROWER AND LENDER WAIVE ANY RIGHT TO
TRIAL BY JURY ON ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (a) ARISING
HEREUNDER OR UNDER ANY OF THE DOCUMENTS COLLATERAL HERETO, OR (b) IN ANY WAY
CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF BORROWER OR LENDER
WITH RESPECT HERETO OR TO ANY OF THE DOCUMENTS COLLATERAL HERETO, OR THE
TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER SOUNDING IN
CONTRACT OR TORT OR OTHERWISE. BORROWER AND LENDER AGREE AND CONSENT THAT ANY
SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL
WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE
CONSENT OF EACH OF THE OTHER PARTIES’ TO THE WAIVER OF THEIR RIGHT TO TRIAL BY
JURY. BORROWER ACKNOWLEDGES THAT IT HAS HAD THE OPPORTUNITY TO CONSULT WITH
COUNSEL REGARDING THIS SECTION, THAT IT FULLY UNDERSTANDS ITS TERMS, CONTENT
AND EFFECT, AND THAT IT VOLUNTARILY AND KNOWINGLY AGREES TO THE TERMS OF THIS
SECTION.


                              25.34
USA Patriot Act Notice. Lender hereby notifies
Borrower that, pursuant to the requirements of the USA PATRIOT ACT, Lender may
be required to obtain, verify and record information that identified Borrower,
which information includes the name and address of Borrower and other
information that will allow Lender to identify Borrower in accordance with the USA
Patriot Act.


[REMAINDER OF PAGE INTENTIONALLY LEFT
BLANK]


83







          IN
WITNESS WHEREOF, the
parties hereto have caused this Agreement to be executed as of the day and year
first above written.


	
 

	
 

	
 


	
 

	
LIBERTY BANK


	
 

	
 


	
 

	
By:

	



	
 

	
 

	



	
 

	
 

	
   Donald
 S. Peruta, Vice President


	
 

	
 

	
 


	
 

	
BLUEGREEN
 CORPORATION


	
 

	
 


	
 

	
By:

	



	
 

	
 

	



	
 

	
 

	
   Anthony
 M. Puleo, Senior V.P.,


	
 

	
 

	
   CFO and
 Treasurer





84







List of Schedules and Exhibits


	
 

	
 

	
 


	
Schedule 1 

	
 

	
Projects


	
Schedule 7.7
 

	
 

	
Taxes


	
Schedule
 7.14 

	
 

	
Names,
 Addresses and States of Formation


	
Schedule
 7.23 

	
 

	
Closing Date
 Indebtedness


	
Schedule 8.9
 

	
 

	
Timeshare
 States


	
Schedule
 8.14 

	
 

	
Developer
 Subsidy


	
Schedule
 8.15 

	
 

	
Project
 Documents


	
Schedule
 13.3 

	
 

	
Required
 Insurance Coverage


	
Schedule
 14.4

	
 

	
Affiliate
 Transactions


	
 

	
 

	
 


	
Exhibit A 

	
 

	
Consumer
 Documents for Primary Projects


	
Exhibit B

	
 

	
Request for
 Receivables Loan Advance Form [Confirm that
 this includes calculation of compliance with Section 2.14]


	
Exhibit C 

	
 

	
Form of
 Assignment


	
Exhibit D 

	
 

	
Form of
 Notice to Purchaser


	
Exhibit E 

	
 

	
Form of
 Title Insurance Policy with Endorsements for Primary Projects


	
Exhibit F 

	
 

	
Form of
 Confirmation of Recording


	
Exhibit G 

	
 

	
Request for
 Supplementary Receivables Loan Advance Form


	
Exhibit H 

	
 

	
Form of
 Compliance Certificate


	
Exhibit I 

	
 

	
Form of
 Notice of Extension of Receivables Loan Advance Period


	
Exhibit J 

	
 

	
Form of
 Monthly Report


	
Exhibit K 

	
 

	
List of
 Title Companies


	
Exhibit L

	
 

	
Form of
 Servicing Agreement with Concord Servicing Corporation













SCHEDULE 1


Projects


PRIMARY PROJECTS


	
 

	
 

	
 

	
 

	
 


	
Resort

	
 

	
Location


	


	
 

	



	
1.

	
 

	
Grande
 Villas at World Golf Village Condominium

	
 

	
St. Augustine, Florida


	
2.

	
 

	
BG Fountains
 Condominium

	
 

	
Orlando, Florida


	
3.

	
 

	
BG Patrick
 Henry Square Vacation Ownership Program

	
 

	
Williamsburg, Virginia


	
4.

	
 

	
Shenandoah
 Crossing Farm & Country Club

	
 

	
Gordonsville, Virginia


	
5.

	
 

	
BG Pirate’s
 Lodge Condominium

	
 

	
Lake Delton, Wisconsin


	
6.

	
 

	
BG Club 36

	
 

	
Las Vegas, Nevada













SCHEDULE 1 (cont’d)


Projects


NON-PRIMARY PROJECTS


	
 

	
 

	
 

	
 

	
 


	
Resort

	
 

	
Location


	


	
 

	



	
1.

	
 

	
Casa Del Mar
 Beach Resort, a Condominium

	
 

	
Ormond Beach, Florida


	
2.

	
 

	
BG Daytona
 SeaBreeze Condominium

	
 

	
Daytona Beach Shores, Florida


	
3.

	
 

	
Orlando’s
 Sunshine Resort, a Condominium

	
 

	
Orlando, Florida


	
4.

	
 

	
Solara
 Surfside Condominium

	
 

	
Surfside, Florida


	
5.

	
 

	
Hammocks at
 Marathon Condominium

	
 

	
Marathon, Florida


	
6.

	
 

	
Mountain Run
 at Boyne

	
 

	
Boyne Falls, Michigan


	
7.

	
 

	
The Falls
 Village Resort, a Condominium

	
 

	
Branson, Missouri


	
8.

	
 

	
The Suites
 at Hershey Condominium

	
 

	
Hershey, Pennsylvania


	
9.

	
 

	
BG Carolina
 Grande Horizontal Property Regime

	
 

	
Myrtle Beach, South Carolina


	
10.

	
 

	
Harbour
 Lights Resort Horizontal Property Regime

	
 

	
Myrtle Beach, South Carolina


	
11.

	
 

	
BG SeaGlass
 Tower Horizontal Property Regime

	
 

	
Myrtle Beach, South Carolina


	
12.

	
 

	
Shore Crest
 Vacation Villas Horizontal Property Regime

	
 

	
North Myrtle Beach, South Carolina


	
13.

	
 

	
Lodge Alley
 Inn Horizontal Property Regime

	
 

	
Charleston, South Carolina


	
14.

	
 

	
Laurel Crest
 Resort, a Condominium

	
 

	
Pigeon Forge, Tennessee


	
15.

	
 

	
MountainLoft
 Resort, a Condominium

	
 

	
Gatlinburg, Tennessee


	
16.

	
 

	
MountainLoft
 Resort II, a Condominium

	
 

	
Gatlinburg, Tennessee


	
17.

	
 

	
Bluegreen
 Wilderness Traveler at Shenandoah Vacation Ownership Program

	
 

	
Gordonsville, Virginia


	
18.

	
 

	
Christmas
 Mountain - Villas

	
 

	
Wisconsin Dells, Wisconsin


	
19.

	
 

	
Fantasy
 Island Resort II, a Condominium

	
 

	
Daytona Beach Shores, Florida


	
20.

	
 

	
Ocean Towers
 Beach Club, a Condominium

	
 

	
Panama City Beach, Florida


	
21.

	
 

	
Outrigger
 Beach Club, a Condominium

	
 

	
Ormond Beach, Florida


	
22.

	
 

	
Resort
 Sixty-Six, a Timeshare Resort

	
 

	
Holmes Beach, Florida


	
23.

	
 

	
Via Roma
 Beach Resort, a Condominium

	
 

	
Bradenton Beach, Florida


	
24.

	
 

	
Paradise
 Isle Resort Condominium

	
 

	
Gulf Shores, Alabama


	
25.

	
 

	
Shoreline
 Towers Condominium

	
 

	
Gulf Shores, Alabama


	
26.

	
 

	
Dolphin
 Beach Club, a Condominium

	
 

	
Daytona Beach Shores, Florida


	
27.

	
 

	
Mariner’s
 Boathouse and Beach Resort, a Condominium

	
 

	
Fort Myers Beach, Florida


	
28.

	
 

	
Tropical
 Sands Resort, a Condominium

	
 

	
Fort Myers Beach, Florida


	
29.

	
 

	
Windward
 Passage Resort Condominium, a Timeshare Condominium

	
 

	
Fort Myers Beach, Florida


	
30.

	
 

	
Gulfstream
 Manor, a Condominium

	
 

	
Gulfstream, Florida


	
31.

	
 

	
Landmark
 Holiday Beach Resort, a Condominium

	
 

	
Panama City Beach, Florida


	
32.

	
 

	
Panama City
 Resort and Club, a Condominium

	
 

	
Panama City Beach, Florida


	
33.

	
 

	
Surfrider
 Beach Club, a Condominium

	
 

	
Sanibel Island, Florida


	
34.

	
 

	
Petit Crest
 Villas at Big Canoe

	
 

	
Marble Hill, Georgia


	
35.

	
 

	
Club Pono
 Kai Interval Ownership Program

	
 

	
Kapaa (Kauai), Hawaii


	
36.

	
 

	
Lake
 Condominiums at Big Sky Resort

	
 

	
Big Sky, Montana


	
37.

	
 

	
Foxrun
 Townhouses

	
 

	
Lake Lure, North Carolina


	
38.

	
 

	
Sand Castle
 Village II Condominium Complex

	
 

	
New Bern, North Carolina


	
39.

	
 

	
Waterwood
 Townhouses

	
 

	
New Bern, North Carolina


	
40.

	
 

	
Players Club
 Resort at Hilton Head Island Horizontal Property Regime

	
 

	
Hilton Head Island, South Carolina


	
41.

	
 

	
Orlando’s
 Sunshine Resort II, a Condominium

	
 

	
Orlando, Florida


	
42.

	
 

	
Shore Crest
 Vacation Villas II Horizontal Property Regime

	
 

	
North Myrtle Beach, South Carolina













 Schedule 7.7 


Taxes


Tennessee Tax Audit


In
2005, the State of Tennessee Audit Division (the “Division”) audited certain
subsidiaries of Borrower for the
period from December 1, 2001 through December 31, 2004. On September 23, 2006,
the Division issued a notice of assessment for approximately $652,000 of
accommodations tax based on the use of Vacation Club accommodations by Vacation
Club members who became members
through the purchase of non-Tennessee property. An informal conference was held
in December 2007 to discuss this matter with representatives of the Division.
No formal resolution of the issue was reached during such conference. There is
no assurance of success in contesting such
assessment.







Schedule
7.14


Names, Addresses and States of
Formation


	
 

	
 


	
Name:

	
Bluegreen Corporation (a
 Massachusetts corporation)


	
 

	
 


	
Address:

	
4960 Conference Way North,
 Suite 100


	
 

	
Boca Raton, Florida 33431








	
 

	
 

	
 

	
 


	
Additional
 names used during past five (5) years:


	
 

	
 

	
 

	
 


	
 

	
1)

	
North
 Carolina:

	
Bluegreen Corporation d/b/a
 Bluegreen Patten Corporation


	
 

	
 

	
 

	
 


	
 

	
2)

	
Louisiana:

	
Bluegreen Corporation of
 Massachusetts


	
 

	
 

	
 

	
 


	
 

	
And such other
 names and/or addresses as may be provided to the Lender from time to time.













Schedule 7.23


Closing Date Indebtedness







Schedule 7.23

Closing Date Indebtdness


	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 


	
Lender 

	
 

	
Project 

	
 

	
Loan Type 

	
 

	
Outstanding

Borrowings 

	
 


	


	
 

	


	
 

	


	
 

	


	
 


	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 


	
Communities
Division: 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
Bank
 of America

	
 

	
Sales
 Office

	
 

	
Construction

	
 

	
$

	
446,623
 

	
 


	
 

	
Foothill

	
 

	
Various

	
 

	
Receivables/Development

	
 

	
 

	
356,039 

	
 


	
 

	
GMAC-RFC

	
 

	
Various

	
 

	
AD&C

	
 

	
 

	
66,062,126 

	
 


	
 

	
John
 Deere Credit

	
 

	
Sanctuary
 Cove

	
 

	
Equipment
 Lease

	
 

	
 

	
46,327 

	
 


	
 

	
Toro/GE

	
 

	
Chapel
 Ridge

	
 

	
Equipment
 Lease

	
 

	
 

	
81,747 

	
 


	
 

	
 

	
 

	
 

	
 

	
 

	
 

	


	


	
 


	
 

	
Total
Communities Debt 

	
 

	
 

	
 

	
 

	
 

	
$ 

	
66,992,862 


	
 


	
 

	
 

	
 

	
 

	
 

	
 

	
 

	


	


	
 


	
Resorts
Division: 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
BB&T

	
 

	
Various

	
 

	
Receivables

	
 

	
$

	
90,158,734
 

	
 


	
 

	
Citizens
 National Bank

	
 

	
Tennessee
 Marketing

	
 

	
Equipment
 Acquisition

	
 

	
 

	
10,243 

	
 


	
 

	
Fifth
 Third Bank

	
 

	
Dunes
 Preview Center

	
 

	
Acquisition
 & Renovation

	
 

	
 

	
3,400,000 

	
 


	
 

	
First
 Merchant’s Bank

	
 

	
The
 Fountains

	
 

	
Equipment
 Acquisition

	
 

	
 

	
6,286 

	
 


	
 

	
First
 Merchant’s Bank

	
 

	
World
 Golf Village

	
 

	
Equipment
 Acquisition

	
 

	
 

	
1,343 

	
 


	
 

	
Foothill

	
 

	
Various

	
 

	
Receivables

	
 

	
 

	
16,177,859 

	
 


	
 

	
GE
 Capital Corporation

	
 

	
Big
 Cedar

	
 

	
Receivables

	
 

	
 

	
18,380,573 

	
 


	
 

	
GMAC-RFC

	
 

	
Club
 36

	
 

	
A&D

	
 

	
 

	
80,839,914 

	
 


	
 

	
GMAC-RFC

	
 

	
Red
 Rock Bluff

	
 

	
A&D

	
 

	
 

	
5,445,238 

	
 


	
 

	
GMAC-RFC

	
 

	
The
 Fountains

	
 

	
Development

	
 

	
 

	
11,886,306 

	
 


	
 

	
GMAC-RFC

	
 

	
The
 Fountains

	
 

	
Development

	
 

	
 

	
6,122,461 

	
 


	
 

	
GMAC-RFC

	
 

	
Various

	
 

	
Receivables

	
 

	
 

	
489,190 

	
 


	
 

	
GMAC-RFC

	
 

	
Big
 Cedar

	
 

	
Receivables

	
 

	
 

	
8,600,467 

	
 


	
 

	
Green
 Bank

	
 

	
Governor’s
 Crossing

	
 

	
Acquisition

	
 

	
 

	
1,949,743 

	
 


	
 

	
Lease
 Finance Corporation

	
 

	
Christmas
 Mountain

	
 

	
Equipment
 Lease

	
 

	
 

	
133,316 

	
 


	
 

	
Textron
 Financial Corporation

	
 

	
Atlantic
 Palace

	
 

	
Acquisition

	
 

	
 

	
8,892,758 

	
 


	
 

	
Textron
 Financial Corporation

	
 

	
Pirate’s
 Lodge

	
 

	
A&D

	
 

	
 

	
13,692,620 

	
 


	
 

	
Textron
 Financial Corporation

	
 

	
Various

	
 

	
Receivables

	
 

	
 

	
1,171,978 

	
 


	
 

	
Wachovia

	
 

	
La
 Pension

	
 

	
Acquisition

	
 

	
 

	
6,097,799 

	
 


	
 

	
Wachovia

	
 

	
Rocky
 River Preview Center

	
 

	
Acquisition

	
 

	
 

	
4,118,001 

	
 


	
 

	
Wachovia

	
 

	
Wllliamsburg

	
 

	
Acquisition

	
 

	
 

	
10,480,000 

	
 


	
 

	
Wachovia

	
 

	
Williamsburg

	
 

	
Renovation

	
 

	
 

	
11,500,000 

	
 


	
 

	
 

	
 

	
 

	
 

	
 

	
 

	


	


	
 


	
 

	
Total
Resorts Debt 

	
 

	
 

	
 

	
 

	
 

	
$ 

	
299,554,828 


	
 


	
 

	
 

	
 

	
 

	
 

	
 

	
 

	


	


	
 


	
Corporate: 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
Junior
 Subordinated Debentures - BST I

	
 

	
 

	
 

	
 

	
 

	
$

	
23,196,000
 

	
 


	
 

	
Junior
 Subordinated Debentures - BST II

	
 

	
 

	
 

	
 

	
 

	
 

	
25,774,000 

	
 


	
 

	
Junior
 Subordinated Debentures - BST III

	
 

	
 

	
 

	
 

	
 

	
 

	
10,310,000 

	
 


	
 

	
Junior
 Subordinated Debentures - BST IV

	
 

	
 

	
 

	
 

	
 

	
 

	
15,464,000 

	
 


	
 

	
Junior
 Subordinated Debentures - BST V

	
 

	
 

	
 

	
 

	
 

	
 

	
15,464,000 

	
 


	
 

	
Junior
 Subordinated Debentures - BST VI

	
 

	
 

	
 

	
 

	
 

	
 

	
20,619,000 

	
 


	
 

	
Marquette
 Financial

	
 

	
 

	
 

	
Software
 Lease

	
 

	
 

	
22,590 

	
 


	
 

	
Marquette
 Financial

	
 

	
 

	
 

	
Software
 Lease

	
 

	
 

	
12,089 

	
 


	
 

	
Wachovia

	
 

	
 

	
 

	
Revolver

	
 

	
 

	
9,949,000 

	
 


	
 

	
 

	
 

	
 

	
 

	
 

	
 

	


	


	
 


	
 

	
Total
Corporate Debt 

	
 

	
 

	
 

	
 

	
 

	
$ 

	
120,810,680 


	
 


	
 

	
 

	
 

	
 

	
 

	
 

	
 

	


	


	
 


	
Estimated
Repurchase Price for Equity Trades: 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
BXG
 Receivables Note Trust 2002-A

	
 

	
 

	
 

	
 

	
 

	
$

	
2,175,826
 

	
 


	
 

	
BXG
 Receivables Note Trust 2004-B

	
 

	
 

	
 

	
 

	
 

	
 

	
272,265 

	
 


	
 

	
BXG
 Receivables Note Trust 2005-A

	
 

	
 

	
 

	
 

	
 

	
 

	
839,799 

	
 


	
 

	
BXG
 Receivables Note Trust 2006-B

	
 

	
 

	
 

	
 

	
 

	
 

	
2,261,475 

	
 


	
 

	
 

	
 

	
 

	
 

	
 

	
 

	


	


	
 


	
 

	
Total
Repurchase Price 

	
 

	
 

	
 

	
 

	
 

	
$ 

	
5,549,365 


	
 


	
 

	
 

	
 

	
 

	
 

	
 

	
 

	


	


	
 


	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
TOTAL
INDEBTEDNESS 

	
 

	
 

	
 

	
 

	
 

	
$ 

	
492,907,735 


	
 


	
 

	
 

	
 

	
 

	
 

	
 

	
 

	


	


	
 





Closing
Date Indebtedness, as shown above, includes those items of indebtedness
reflected in the Company’s Condensed Consolidated Balance Sheet as “Receivable-
Backed Notes Payable,” “Lines of Credit and Notes Payable” and “Junior
Subordinated Debentures.” See the Company’s quarterly and annual SEC filings for
additional items included in the “Liabilities” section of the Balance Sheet.
The above schedule also includes estimated amounts due for repurchases under
our off-balance sheet receivable purchase facilities and term securitizations. Such purchase facilities and
term securitizations are without recourse except for breaches of certain
customary representations and warranties at
the time of transfer.







Schedule
8.9


Timeshare
States


	
 


	
Alabama


	
 


	
Alaska


	
 


	
Arkansas


	
 


	
California


	
 


	
Colorado


	
 


	
District of Columbia


	
 


	
Florida


	
 


	
Georgia


	
 


	
Illinois


	
 


	
Indiana


	
 


	
Kansas


	
 


	
Louisiana


	
 


	
Maine


	
 


	
Maryland


	
 


	
Michigan


	
 


	
Minnesota


	
 


	
Missouri


	
 


	
Montana


	
 


	
Nebraska


	
 


	
Nevada


	
 


	
New Jersey


	
 


	
New York


	
 


	
New Mexico


	
 


	
Ohio


	
 


	
Oregon


	
 


	
Rhode Island


	
 


	
South Carolina


	
 


	
Tennessee


	
 


	
Utah


	
 


	
Vermont


	
 


	
Virginia


	
 


	
Washington


	
 


	
West Virginia


	
 


	
Wisconsin


	
 


	
Wyoming













Schedule
8.14


Developer Subsidy


NOT APPLICABLE







Schedule 8.15


Project Documents


BG CLUB 36


	
 

	
 

	
 


	
 

	
a.

	
Master Declaration of
 Covenants, Conditions, Easements and Restrictions for Bluegreen Club 36, recorded July 29, 2008, Book 080729 as
 Document No. 0004566, in the office of
 the County Recorder of Clark County, Nevada.


	
 

	
 

	
 


	
 

	
b.

	
Articles of Incorporation of BG
 Club 36 Master Association, Inc.


	
 

	
 

	
 


	
 

	
c.

	
Bylaws of BG Club 36 Master
 Association, Inc.


	
 

	
 

	
 


	
 

	
d.

	
Declaration of Covenants,
 Conditions, Easements, Restrictions and Timeshare Ownership Instrument
 for BG Club 36, recorded July 29, 2008, in Book 080729 as Document No. 0004568, in the office of the County Recorder
 of Clark County, Nevada.


	
 

	
 

	
 


	
 

	
e.

	
Articles of Incorporation of BG
 Club 36 Owners Association, Inc.


	
 

	
 

	
 


	
 

	
f.

	
Bylaws of BG Club 36 Owners
 Association, Inc.


	
 

	
 

	
 


	
 

	
g.

	
Rules and Regulations for
 Bluegreen Club 36.


	
 

	
 

	
 


	
 

	
h.

	
That certain Management
 Agreement by and between BG Club 36 Owners Association, Inc., and Bluegreen Resorts Management, Inc.


	
 

	
 

	
 


	
 

	
i.

	
Nevada Public Offering
 Statement for Bluegreen Vacation Club.


	
 

	
 

	
 


	
 

	
j.

	
Bluegreen Vacation Club
 MULTI-SITE Public Offering Statement and any and all additional documents referenced therein with
 respect to BG Club 36.


	
 

	
 

	
 


	
 

	
k.

	
The applicable Consumer
 Documents for BG Club 36.


	
 

	
 

	
 


	
 

	
l.

	
Any and all such other
 documents and records as may be existing in any recording office of an
 applicable jurisdiction relating to BG Club 36.





SHENANDOAH
CROSSING FARM & COUNTRY CLUB







	
 

	
 

	
 


	
 

	
a.

	
Declaration of Covenants,
 Conditions and Restrictions for Shenandoah Crossing Farm and Club, recorded September 17, 1987, in the
 Clerk’s Office of the Circuit Court of Louisa County, Deed Book 326,
 Page 412, with amendments of record in Deed Book 340, Page 44; Deed Book 342,
 Page 467; Deed Book 351, Page 688; Deed Book 370, Page 504; Deed Book 326, Page 412; Deed Book 405, Page 84; Deed Book
 448, Page 360; Deed Book 491, Page
 419; Deed Book 587, Page 791.


	
 

	
 

	
 


	
 

	
b.

	
Articles of Incorporation of
 Shenandoah Crossing Farm and Club Resort Section Owners Association, Inc.


	
 

	
 

	
 


	
 

	
c.

	
By-Laws of the Shenandoah
 Crossing Farm and Club Resort Section Owners Association, Inc., as amended.


	
 

	
 

	
 


	
 

	
d.

	
Owner’s Manual, Rules and
 Regulations for Shenandoah Crossing Resort Community at Shenandoah Crossing Resort and Country Club.


	
 

	
 

	
 


	
 

	
e.

	
That certain Management
 Agreement dated ________day of________, 2000 [sic] by and between Shenandoah Crossing Country Club Owners Association, Inc.
 and Bluegreen Resorts Management,
 Inc.


	
 

	
 

	
 


	
 

	
f.

	
Membership Camping Operator’s
 Disclosure Statement (Virginia).


	
 

	
 

	
 


	
 

	
g.

	
Bluegreen Vacation Club
 MULTI-SITE Public Offering Statement and any and all additional documents referenced therein with
 respect to Shenandoah Crossing Farm & Country Club.


	
 

	
 

	
 


	
 

	
h.

	
The applicable Consumer
 Documents for Shenandoah Crossing Farm & Country Club.


	
 

	
 

	
 


	
 

	
i.

	
Any and all such other
 documents and records as may be existing in any recording office of an
 applicable jurisdiction relating to Shenandoah Crossing Farm & Country
 Club.


	
 

	
 

	
 


	
BG FOUNTAINS
 CONDOMINIUM


	
 


	
 

	
a.

	
Declaration of Condominium for BG Fountains
 Condominium, recorded October 26, 2004,
 in Book 07674, Page 4336 of the Public Records of Orange County, Florida,
 with amendments of record in Book
 07785, Page 2252; Book 08559, Page 1321; Book 08559, Page 1360; Book 08775,
 Page 4485; Book 09443, Page 2378.


	
 

	
 

	
 


	
 

	
b.

	
Articles of Incorporation of
 BG Fountains Condominium Association, Inc., as amended.













	
 

	
 

	
 


	
 

	
c.

	
Bylaws of BG Fountains
 Condominium Association, Inc., as amended.


	
 

	
 

	
 


	
 

	
d.

	
BG Fountains Condominium Rules
 and Regulations.


	
 

	
 

	
 


	
 

	
e.

	
That certain Management
 Agreement dated as of November 30, 2004, by and between BG Fountains Condominium Association, Inc., and
 Bluegreen Resorts Management, Inc.


	
 

	
 

	
 


	
 

	
f.

	
BG Fountains Condominium A
 Bluegreen Vacation Club Resort Public Offering Statement (Florida).


	
 

	
 

	
 


	
 

	
g.

	
Bluegreen Vacation Club
 MULTI-SITE Public Offering Statement and any and all additional documents referenced therein with
 respect to BG Fountains Condominium.


	
 

	
 

	
 


	
 

	
h. 

	
The applicable Consumer
 Documents for BG Fountains Condominium.


	
 

	
 

	
 


	
 

	
i. 

	
Any and all such other
 documents and records as may be existing in any recording office of an
 applicable jurisdiction relating to BG Fountains Condominium.


	
 

	
 

	
 


	
BG PIRATE’S
 LODGE


	
 


	
 

	
a.

	
First Amendment to Master Declaration Between
 Bluegreen Vacations Unlimited, Inc., BG
 Pirate’s Lodge Owners Association, Inc., Treasure Island, LLC, DNL of
 Wisconsin, LLC, and Big Chief
 Enterprises, LLC recorded May 28, 2008 as Document No. 962000.


	
 

	
 

	
 


	
 

	
b.

	
First Amendment to Declaration
 of Condominium of Dells Vacation Condominium and Declaration of Covenants, Conditions, Easements
 and Restrictions and Time-Share Instrument
 for Club Optima Amending, Restating, and Merging them into Declaration of Condominium for BG Pirate’s Lodge Condominium
 recorded November 3, 2006, as Document
 No. 921739.


	
 

	
 

	
 


	
 

	
c.

	
Amended and Restated Articles of
 Incorporation of BG Pirate’s Lodge Owners Association, Inc.


	
 

	
 

	
 


	
 

	
d.

	
Amended and Restated By-Laws
 of BG Pirate’s Lodge Owners Association, Inc.


	
 

	
 

	
 


	
 

	
e.

	
Rules and Regulations of BG
 Pirate’s Lodge Owners Association, Inc.


	
 

	
 

	
 


	
 

	
f.

	
That certain Management Agreement dated September
 13, 2006, by and between BG Pirate’s Lodge
 Owners Association, Inc. and Bluegreen Resorts Management, Inc.













	
 

	
 

	
 


	
 

	
g.

	
Time-Share Disclosure
 Statement BG Pirate’s Lodge Condominium (Wisconsin).


	
 

	
 

	
 


	
 

	
h.

	
Bluegreen Vacation Club MULTI-SITE Public Offering
 Statement and any and all additional
 documents referenced therein with respect to BG Pirate’s Lodge Condominium.


	
 

	
 

	
 


	
 

	
i.

	
The applicable Consumer
 Documents for BG Pirate’s Lodge Condominium.


	
 

	
 

	
 


	
 

	
j.

	
Any and all such other documents and records as may
 be existing in any recording office of an
 applicable jurisdiction relating to BG Pirate’s Lodge Condominium.


	
 

	
 

	
 


	
GRANDE VILLAS
 AT WORLD GOLF VILLAGE CONDOMINIUM


	
 


	
 

	
a.

	
Master Declaration of Covenants, Conditions, and
 Restrictions, recorded September 3, 1998,
 in the Official Records of St. John’s County Book 1345, Page 1586


	
 

	
 

	
 


	
 

	
b.

	
Declaration of Covenants,
 Conditions, and Restrictions for St. Johns—Northwest Master, recorded in the Official Records of St. John’s
 County Book 1185, Page 0598.


	
 

	
 

	
 


	
 

	
c.

	
Articles of Incorporation of
 St. Johns Northwest Master Association, Inc.


	
 

	
 

	
 


	
 

	
d.

	
Bylaws of St. Johns Northwest
 Master Association, Inc.


	
 

	
 

	
 


	
 

	
e.

	
Declaration of Covenants and Restrictions for St
 Johns—Northwest Commercial recorded in the
 Official Records of St. John’s County Book 1185, Page 0649.


	
 

	
 

	
 


	
 

	
f.

	
Articles of Incorporation of
 St. Johns Northwest Commercial Property Owners Association.


	
 

	
 

	
 


	
 

	
g.

	
Bylaws of St. Johns Northwest
 Commercial Property Owners Association.


	
 

	
 

	
 


	
 

	
h.

	
Declaration of Condominium
 for Grande Villas at World Golf Village Condominium a Bluegreen Vacation Club
 Resort recorded January 22, 2004, in the Official Records of St. John’s County Book 2126, Page 1051, with
 amendments of record in Book 2964, Page 1900.


	
 

	
 

	
 


	
 

	
i. 

	
Articles of Incorporation of
 Grand Villas at World Golf Village Condominium Association, Inc.













	
 

	
 

	
 


	
 

	
j.

	
Bylaws of Grande Villas at
 World Golf Village Condominium Association, Inc.


	
 

	
 

	
 


	
 

	
k.

	
Rules and Regulations for
 Grande Villas at World Golf Village Condominium.


	
 

	
 

	
 


	
 

	
l.

	
That certain Management Agreement dated October 27, 2003,
 by and between Grande Villas at World Golf
 Village Condominium Association, Inc. and Bluegreen Resorts Management, Inc.


	
 

	
 

	
 


	
 

	
m.

	
Grande Villas at World Golf
 Village Condominium A Bluegreen Vacation Club Resort Public Offering Statement (Florida).


	
 

	
 

	
 


	
 

	
n.

	
Bluegreen Vacation Club MULTI-SITE Public Offering
 Statement and any and all additional documents referenced therein with
 respect to Grande Villas at World Golf Village
 Condominium.


	
 

	
 

	
 


	
 

	
o.

	
The applicable Consumer
 Documents for Grande Villas at World Golf Village Condominium.


	
 

	
 

	
 


	
 

	
p.

	
Any and all such other
 documents and records as may be existing in any recording office of an applicable jurisdiction relating to Grande
 Villas at World Golf Village Condominium.





BG Patrick Henry Square Vacation Ownership Program


                   To
Be Provided Post-Closing







Schedule 13.3


Insurance


See insurance coverage, with respect to amount and scope, as
set forth in the following:


	
 

	
 

	
 


	
 

	
1.

	
Such coverages as set forth in
 the Evidence of Commercial Property Insurance certificate (ACORD 28), dated August 07, 2008, with Bluegreen
 Corporation, 4960 Conference Way North,
 Suite 100, Boca Raton, Florida, 33431, as the Named Insured, and Liberty
 Bank, Its Successors and or Assigns, 291 Main St., Middleton, Connecticut, 06457, as Loss Payee (Certificate No: 570030033613),
 as such may be modified from time to time in accordance with applicable Legal Requirements.


	
 

	
 

	
 


	
 

	
2.

	
Such coverages as set forth in
 the Certificate of Liability Insurance (ACORD 25), dated August 15,
 2008, with Bluegreen Corporation, 4960 Conference Way North, Boca Raton, Florida, 33431, as the Insured, and Liberty
 Bank, Its Successors and or
 Assigns, 291 Main Street, Middleton, Connecticut, 06457, as Certificate Holder, as such may be modified
 from time to time in accordance
 with applicable Legal Requirements.













Schedule 14.4


Affiliate Transactions


NOT APPLICABLE







EXHIBIT A


Forms of Consumer Documents


See attached.







EXHIBIT B


Form
of Request for Receivables Loan Advance


REQUEST FOR RECEIVABLES LOAN ADVANCE


____________, 20 ___


Liberty Bank 

315 Main Street 

Middletown, CT 06457


	
 

	
 

	
 


	
 

	
Re:

	
Receivables Loan Agreement
 dated as of August 27, 2008 between
 Bluegreen Corporation and Liberty Bank





Gentlemen:


                    This
is to request an advance under the Receivables Loan pursuant to the
above-referenced Receivables Loan Agreement (as it may from time to time be
amended, modified or restated the “Loan
Agreement”), in an amount equal to $_____, which is ninety percent (90%)
of the current unpaid principal balances of such of the Timeshare Loans
described in Schedule “A”
attached hereto which are Qualified Timeshare Loans. Capitalized terms not otherwise defined herein shall have the meanings
set forth therefor in the Loan Agreement.


                    Enclosed
or previously delivered to you, or on your behalf at your direction, with respect to each such Timeshare Loan are true and
correct copies or originals as indicated of:


	
 

	
 

	
 


	
 

	
(a)

	
Credit Application (copy);


	
 

	
 

	
 


	
 

	
(b)

	
Evidence of FICO Score (copy);


	
 

	
 

	
 


	
 

	
(c)

	
Purchase Agreement (copy);


	
 

	
 

	
 


	
 

	
(d)

	
Deed (copy);


	
 

	
 

	
 


	
 

	
(e)

	
Mortgage (copy);


	
 

	
 

	
 


	
 

	
(f)

	
Note (original duly endorsed to
 your order with recourse);


	
 

	
 

	
 


	
 

	
(g)

	
Disclosure Statement (copy);


	
 

	
 

	
 


	
 

	
(h) 

	
Owner Confirmation Interview
 (Acknowledge of Representations) (copy);


	
 

	
 

	
 


	
 

	
(i)

	
Receipt for Timeshare Documents
 (copy);


	
 

	
 

	
 


	
 

	
(j)

	
Service Disclosure Statement
 (copy);


	
 

	
 

	
 


	
 

	
(k)

	
Settlement Statement (HUD-1)
 (copy);


	
 

	
 

	
 


	
 

	
(l)

	
Good Faith Estimate of
 Settlement Charges (copy); and


	
 

	
 

	
 


	
 

	
(m)

	
Certificate of Purchase of Owner Beneficiary Rights
 (copy).













                    Borrower
hereby certifies as of the date hereof that:


	
 

	
 

	
 


	
 

	
(a)

	
All
 the representations and warranties set forth in the Loan Agreement are true as of the date hereof (or to
 the extent relating to an earlier period of time, as of such earlier
 time period);


	
 

	
 

	
 


	
 

	
(b)

	
Borrower
 is in compliance with each and every one of its covenants, agreements and obligations under the
 Loan Agreement and the other Loan
 Documents;


	
 

	
 

	
 


	
 

	
(c)

	
There is no Event of
 Default or Incipient Default with respect to any Obligation of the Borrower under the Loan Agreement;


	
 

	
 

	
 


	
 

	
(d)

	
Each
 of the Timeshare Loans described in Schedule
 “A” is a Qualified
 Timeshare Loan;


	
 

	
 

	
 


	
 

	
(e)

	
Borrower
 has in its possession a complete Loan File in electronic format for all Timeshare Loans described in Schedule
“A”;


	
 

	
 

	
 


	
 

	
(f)

	
Borrower
 is entitled to the requested Advance pursuant to the Loan Agreement;


	
 

	
 

	
 


	
 

	
(g)

	
Borrower
 is the owner of the Timeshare Loans (and the Notes and Mortgages related thereto) listed on Schedule
“A”, free of all liens,
 encumbrances and claims of third parties whatsoever, except for Permitted Encumbrances, and has full right
 and lawful authority to collaterally assign the same to Liberty Bank;


	
 

	
 

	
 


	
 

	
(h)

	
In
 allocating which Timeshare Loans to assign to Lender in connection with the requested Advance, Borrower
 has not adversely selected to allocate to Lender otherwise Qualified Timeshare Loans based on Project location, in a
 proportion materially different
 from Borrower’s other lenders;


	
 

	
 

	
 


	
 

	
(i)

	
The
 original principal amounts and outstanding principal balances of the Timeshare Loans shown on Schedule
“A” hereto, are in all cases true and correct and no payment on account
 of any of the Notes is more than thirty (30) days past due;


	
 

	
 

	
 


	
 

	
(j)

	
The
 aggregate of all Fifteen Year Timeshare Loans do not comprise more than 10% of the outstanding
 principal balance of all of the Qualified Timeshare Loans included in
 the Liberty Portfolio Timeshare Loans
 (including the Timeshare Loans described on Schedule “A”)
 and against which Liberty Bank has made or is making Advances;


	
 

	
 

	
 


	
 

	
(k)

	
The
 aggregate of all Non-Resident Timeshare Loans do not comprise more than 10% of the outstanding
 principal balance of all





2







	
 

	
 

	
 


	
 

	
 

	
of the Qualified
 Timeshare Loans included in the Liberty Portfolio Timeshare Loans (including
 the Timeshare Loans described on Schedule “A”) and against which Liberty Bank has made or is making
 Advances, and payment of each Non-Resident Timeshare Loan is and shall be made by a Purchaser under an “auto pay”
program
 via a credit card, Pre-Authorized Checking or ACH payment;


	
 

	
 

	
 


	
 

	
(l)

	
The
 aggregate of all Less Than 600 FICO Score Timeshare Loans and No-FICO
 Score Timeshare Loans do not comprise more than 25% of the outstanding principal balance of all of the Qualified Timeshare Loans
included in the Liberty
 Portfolio Timeshare Loans (including the Timeshare Loans described on Schedule “A”)
 and against which Liberty Bank has made or is making Advances;


	
 

	
 

	
 


	
 

	
(m)

	
The
 aggregate of all No-FICO Score Timeshare Loans do not comprise more
 than 5% of the outstanding principal balance of all of the Qualified
 Timeshare Loans included in the Liberty Portfolio Timeshare Loans (including the Timeshare Loans described on Schedule
“A”)
 and against which Liberty Bank has made or is making Advances;


	
 

	
 

	
 


	
 

	
(n)

	
The
 aggregate of all Non-Primary Project Timeshare Loans do not comprise more than 15% of the outstanding
 principal balance of all of the Qualified Timeshare Loans included in
 the Liberty Portfolio Timeshare Loans
 (including the Timeshare Loans described on Schedule “A”)
 and against which Liberty Bank has made or is making Advances;


	
 

	
 

	
 


	
 

	
(o)

	
The
 minimum weighted average FICO score of all Qualified Timeshare Loans included in the Liberty
 Portfolio Timeshare Loans (including the Timeshare Loans described on Schedule “A” and excluding
 No-FICO Score Timeshare Loans) shall be at least 650;


	
 

	
 

	
 


	
 

	
(p)

	
The
 weighted average interest rate for all of the Qualified Timeshare Loans included in the Liberty
 Portfolio Timeshare Loans (including the Timeshare Loans described on Schedule “A”)
 is greater than or equal to 12% per annum; and


	
 

	
 

	
 


	
 

	
(q)

	
All regulatory
 approvals necessary for the ownership and operation of the Projects as timeshare projects, for the sale and financing of
 the Timeshare Interests and for all other matters related to the ownership
 and operation of the Projects and the transactions contemplated under
 the Loan Documents have been obtained.





3







Very truly yours,


	
 

	
 

	
 

	
 


	
 

	
BLUEGREEN
 CORPORATION


	
 

	
 

	
 

	
 


	
 

	
By: 

	
 


	
 

	
 

	



	
 

	
Name/Title: 

	
 


	
 

	
 

	
 

	






Attach:
Schedule “A”


4







EXHIBIT C


Form of Assignment


[CONFORM AND/OR MODIFY AS TO EACH STATE’S
REQUIREMENTS

INCLUDING, WITHOUT LIMITATION, REQUIREMENTS
FOR RECORDING]


COLLATERAL ASSIGNMENT OF LOAN DOCUMENTS

(Timeshare Interests)


          FOR
VALUABLE CONSIDERATION, intending
to be legally bound hereby, BLUEGREEN
CORPORATION, a Massachusetts corporation (“Borrower”), hereby collaterally
assigns and transfers to LIBERTY BANK, a
Connecticut nonstock mutual savings bank,
having an office at 315 Main Street, Middletown, CT 06457 (“Lender”) all of Borrower’s interest in, to and
under those Mortgages
described on Exhibit “A”
attached hereto, recorded or to be
recorded in the applicable county as referenced in Exhibit “A” attached hereto, together with the Notes
secured by such Mortgages, all
other documents executed and delivered in connection with such Mortgages and Notes, including the other Consumer
Documents, as such terms are defined
in that certain Receivables Loan Agreement dated as of August 27, 2008, between Borrower and Lender, as it may from time
to time be amended, modified or restated (the “Receivables Loan Agreement”), all monies due and to become due on
account of
such Mortgages, Notes, Consumer Documents and other documents, and all
rights accrued or to accrue under such Mortgages, Notes, Consumer Documents and
other documents.


          This
collateral assignment has been made and delivered pursuant to the provisions of
the Receivables Loan Agreement and secures the payment of:


	
 

	
 

	
 


	
              
     1.       All
 amounts at any time owing by Borrower to Lender on account of the promissory note of the Borrower payable to the
 order of Lender, dated as of _______________, 2008 in the face amount of Seventy-Five Million Dollars ($75,000,000)
 and delivered to Lender pursuant to the Receivables Loan Agreement and all
 amendments, modifications, increases and reductions thereof and any
 replacement or substitute notes issued therefor;


	
 

	
 

	
 


	
              
     2.      All
 amounts at any time owing by Borrower to Lender under any provisions of the Receivables Loan Agreement or
 any documents collateral thereto and all Obligations (as defined under
 the Receivables Loan Agreement); and


	
 

	
 

	
 


	
              
      3.      All
 costs of collecting said amounts, including reasonable attorneys’ fees.





          Borrower
does hereby agree to warrant and forever defend the title to such Mortgages, Notes and other Consumer Documents unto Lender,
its successors and assigns against any claims of any person whatsoever.


          Borrower
represents and warrants to Lender, its successors and assigns that such Notes, Mortgages
and other Consumer Documents are collaterally assigned hereunder, free and
clear of







any
lien, claim or encumbrances of any nature, subject to any Permitted
Encumbrances (as defined in the
Receivables Loan Agreement).


-2-







          IN
WITNESS WHEREOF, Borrower has executed this
Assignment, effective as of ______________________, 20____.


	
 

	
 

	
 


	
 

	
BLUEGREEN CORPORATION


	
 


	
 

	
By:


	
 

	
 

	



	
 

	
Name/Title:





-3-







EXHIBIT “A”


          All
of the Mortgages listed on this Schedule involve the finance of the purchase of
Timeshare Interests in Units at the below listed Projects:


	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 


	
Loan #

	
 

	
Purchaser

	
 

	
Project 

 Name

	
 

	
Timeshare 

 Interval 

 Number

	
 

	
State of 

 Project

	
 

	
County of 

 Project

	
 

	
Original 

 Principal 

 Amount 

 of Note 

 Secured 

 by 

 Mortgage

	
 

	
Date of 

 Mortgage

	
 

	
Recording 

 Information


	


	
 

	


	
 

	


	
 

	


	
 

	


	
 

	


	
 

	


	
 

	


	
 

	














EXHIBIT
D


Form of Notice to Purchaser


[TO BE PLACED ON BORROWER’S LETTERHEAD]


NOTICE OF ASSIGNMENT


          This
is to notify you that the purchase money loan which you obtained from Bluegreen
Corporation (the “Timeshare Loan”) in
connection with your credit purchase of a timeshare interest in the
Bluegreen Vacation Club has been assigned to Liberty Bank, 291 Main Street, Middletown, Connecticut 06457.


          Bluegreen
Corporation will continue to service your Timeshare Loan and all terms and conditions
of your loan will remain the same.


          If
you are currently paying your Timeshare Loan by check, your permanent payment
coupons will arrive under separate cover within the next few weeks. You are
directed to make all payments on account of
the Timeshare Loan directly to Bluegreen Corporation and mail to: Bluegreen
Corporation/Liberty Bank, P.O. Box 415355, Boston, Massachusetts 02241-5355.


          If
you are currently paying your loan by automated draft, Bluegreen Corporation
will continue to automatically debit by means of electronic transfer.


          A
copy of this Notice shall have the same force and effect as an original signed
on our behalf.


Very truly yours,


Bluegreen Corporation

Customer Service Department 

1-800-456-2582







EXHIBIT E


Form of Title Insurance Policy
with Endorsements for Primary Projects


See attached.







EXHIBIT F


Form of Confirmation of Recording


[Print on Letterhead of Agent for Title Company]


______________
______, 20___


Liberty Bank

291 Main Street

Middletown, CT 06457

Attention: Donald S. Peruta, Vice
President


	
 

	
 

	
 


	
 

	
Re:

	
Receivables
 Loan Agreement dated as of August 27, 2008, by and between Bluegreen Corporation and Liberty Bank
 (the “Loan Agreement”)





Ladies and Gentlemen:


                    As
agent on behalf of __________________________
(the “Title Company”), I
am enclosing a copy of the Collateral
Assignment of Loan Documents (the “Assignment”) by Bluegreen Corporation (“Borrower”) to Liberty
Bank, covering Timeshare Interests at the project
known as ___________________, in precisely the form recorded today in the
Official Public Records for the
County of ______________, State of _____________.


                    On
behalf of the Title Company, I confirm that at the time of the recording of the
Assignment, (a) each of the [deeds of
trust/mortgages] described on Schedule
A attached hereto was of
record a first [deed of trust/mortgage], prior
in lien to all other monetary liens and
encumbrances whatsoever, other than the exceptions as set forth in the
applicable title insurance policy;
(b) ownership of the Timeshare Interests described in Schedule A was vested in the purchasers described on
Schedule A pursuant to a properly
recorded deed; (c) the applicable purchaser had duly executed the [deed of trust/mortgage] related to the
Timeshare Interest owned by such purchaser;
(d) Borrower was of record the owner and beneficiary of each of the [deeds of
trust/mortgages] described in Schedule
A attached hereto and the notes secured by such [deeds of
trust/mortgages] free of all liens, encumbrances and claims of third
parties whatsoever, other than other than the exceptions as set forth in
the applicable title insurance policy; and
(e) all recording fees for such deeds, deeds of trust and the Assignment has
been paid in full.


                    On
behalf of the Title Company, I agree to send to you copies of the recording officer’s
receipts for the recording fees for the Assignment within ten (10) business
days after the date of this letter.







                    On
behalf of the Title Company, I agree to send to you the original Assignment promptly
upon them becoming available from the recording office, but no later than one
hundred twenty (120) days after the date of
this letter. On behalf of the Title Company, I commit to issuing and forwarding to you within the earlier
to occur of (a) ninety (90) days after the date of this letter or (b)
prior to the expiration of the title insurance commitment in connection
therewith, if applicable, the original title
insurance policy insuring the assigned [deeds
of trust/mortgages] described on Schedule A in favor of Lender.


	
 

	
 


	
 

	
Very truly yours,


	
 

	
 


	
 

	



	
 

	
 


	
 

	
By:


	
 

	



	
 

	
Name/Title:


	
 

	






Attach: Schedule A







EXHIBIT G


Form of Request for Supplementary
Advance


REQUEST FOR SUPPLEMENTARY ADVANCE


____________, 200__


Liberty Bank

315 Main Street

Middletown, CT 06457


	
 

	
 

	
 


	
 

	
Re:

	
Receivables
 Loan Agreement dated as of August 27, 2008, between Bluegreen Corporation and Liberty Bank





Ladies and Gentlemen:


          This
is to request a Supplementary Advance under the Receivables Loan pursuant to
the above-referenced Receivables Loan
Agreement (as it may from time to time be amended, modified or restated
the “Loan Agreement”), in an
amount equal to $________, which amount is
equal to the amount by which (a) ninety percent (90%) of the then unpaid
principal balance of all Qualified Timeshare
Loans currently in the Liberty Portfolio Timeshare Loans exceeds (b) the unpaid principal balance of the Receivables
Loan. Capitalized terms not otherwise defined herein shall have the meanings
set forth therefor in the Loan Agreement. Attached hereto is Borrower’s calculation of such availability.


          Borrower
certifies that:


	
 

	
 

	
 


	
 

	
(a)

	
All the representations and warranties set forth in
 the Loan Agreement are true as of the date
 hereof (or the extent relating to an earlier time, as of such earlier
 time period);


	
 

	
 

	
 


	
 

	
(b)

	
Borrower is in compliance with
 each and every one of its covenants, agreements
 and obligations under the Loan Agreement and the other Loan Documents, including, without limitation, Sections
2.2(e) and 2.13 thereof;


	
 

	
 

	
 


	
 

	
(c)

	
There is no Event of Default or
 Incipient Default with respect to any obligation of the Borrower under
 the Loan Agreement;


	
 

	
 

	
 


	
 

	
(d)

	
Borrower is entitled to the requested Supplementary
 Advance pursuant to the Loan Agreement;













	
 


	
_____________________________


	
Liberty Bank


	
________, 200___


	
Page 2








	
 

	
 

	
 


	
 

	
(e)

	
All
 regulatory approvals necessary for the ownership and operation of the Projects as timeshare projects, for the sale and
 financing of the Timeshare Interests and for all other matters related to the
 ownership and operation of the
 Projects and the transactions contemplated under the Loan Documents have been obtained and are in full force and
 effect.








	
 

	
 


	
 

	
Very truly yours,


	
 

	
 


	
 

	
BLUEGREEN CORPORATION


	
 

	
 


	
 

	
By:


	
 

	



	
 

	
 


	
 

	
Name/Title:


	
 

	






 Attach:
Borrower’s calculation of availability







EXHIBIT H


Form of Compliance Certificate


Testing Date: ___________________


COMPLIANCE CERTIFICATE


          In
accordance with Section 16.6 of
the Receivables Loan Agreement dated as of August 27, 2008 by and between
Bluegreen Corporation (“Borrower”) and
Liberty Bank (“Lender”) (as it may be amended,
modified, supplemented or restated, the “Loan
Agreement”), the undersigned hereby certifies to Lender that as of the
Testing Date described above:


	
 

	
 

	
 


	
 

	
1.

	
The undersigned is the Chief Financial Officer of
 Borrower.


	
 

	
 

	
 


	
 

	
2.

	
Borrower has observed, performed and complied with
 each and every undertaking contained in the Loan Agreement and the Loan
 Documents.


	
 

	
 

	
 


	
 

	
3.

	
The calculation of Borrower’s compliance with the
 financial covenants in Section 15 of the Loan Agreement
 is set forth on Exhibit A attached
 hereto.


	
 

	
 

	
 


	
 

	
4.

	
There does not exist any Incipient Default or Event of
 Default.





          Capitalized
terms shall have the meanings set forth therefor in the Loan Agreement. The certifications in this
Compliance Certificate are made by the undersigned, in his/her capacity as the Chief Financial
Officer of Borrower, from the undersigned’s own personal knowledge, after due inquiry and with
full knowledge that Lender will rely upon this Compliance Certificate. The undersigned has
executed and delivered this Compliance Certificate as an inducement for Lender to continue to extend
credit facilities to the Borrower pursuant to the Loan Agreement.


	
 

	
 


	
 

	
BLUEGREEN CORPORATION


	
 

	
 


	
 

	
By:


	
 

	



	
 

	
Name/Title:





Dated: ______________________________________







EXHIBIT I


Form of Notice of Extension of
Receivables Loan Advance Period


[TO BE PRINTED ON LIBERTY BANK’S
LETTERHEAD]


_________________, 20___


Via Telecopier

Bluegreen Corporation

4960 Conference Way North, Suite 100

Boca Raton, Florida 33431

Attn: Anthony M. Puleo

Telecopier No.: (561) 912-8123


	
 

	
 


	
 

	
Re:          Receivables
 Loan Agreement dated August 27, 2008 by and between Bluegreen
 Corporation and Liberty Bank (the “Loan Agreement”)





Ladies and Gentlemen:


          This
letter, being sent pursuant to Section
2.12 of the Loan Agreement, is to notify you that the Receivables Loan Advance Period (as
defined in the Loan Agreement) shall be extended for an additional twelve (12) month period and shall now end on August
27, 20[11 or 12]. Pursuant
to Section 5.4 of the Loan
Agreement, the Receivables Loan Maturity Date (as defined in the Loan Agreement) shall also be extended for
an additional twelve (12) month period and shall now be August ______, 20[15
or 16]. Such extensions to the
Receivables Loan Advance Period and
Receivables Loan Maturity Date shall be deemed effective as of ____________,
20_____.


	
 

	
 


	
 

	
Very truly yours, 


	
 

	
 


	
 

	
LIBERTY BANK


	
 

	
 


	
 

	
By:


	
 

	



	
 

	
Name/Title:













EXHIBIT J 


Form of Monthly
Report


See attached.


-2-







APRIL 1, 2008


	
 

	
 


	
Name

	
 


	
 

	



	
 

	
 


	
Address

	
 


	
 

	



	
 

	
 


	
 

	



	
 

	
 


	
 

	






RE: COLLECTION PERIOD MARCH 1, 2008 THRU
MARCH 31, 2008


Dear __________:


The
following servicer report has been prepared pursuant to the Servicing
Agreement, dated __________, by and between Bluegreen
Corporation and Liberty Bank for the month ended MARCH 31, 2008.


	
 

	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
 

	
 

	
# of Accts 

	
 

	
Principal Balance 

	
 


	
 

	
 

	
 

	
  

	
 

	
  

	
 


	
I.

	
Reconciliation
 Summary

	
 

	
  

	
 

	
  

	
 


	
 


	
 

	
Beginning
Balance

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
Plus: Total
Debits

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
Less: Total
Principal Credits

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
Ending
Balance

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
Less:
Ineligible Receivables

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
Eligible
Receivables

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
 

	
 

	
  

	
 

	
  

	
 


	
II.

	
Collateral
 Additions

	
 

	
  

	
 

	
  

	
 


	
 

	
New Collateral
Advances

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
Substitutions

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
Total
Debits

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
 

	
 

	
  

	
 

	
  

	
 


	
III.

	
Collateral
 Activity

	
 

	
  

	
 

	
  

	
 


	
 

	
Principal

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
Interest

	
 

	
  

	
 

	
$0.00 

	
 


	
 

	
Late
Charges

	
 

	
  

	
 

	
$0.00 

	
 


	
 

	
Servicing
Fees

	
 

	
  

	
 

	
$0.00 

	
 


	
 

	
Other Cash -
Misc Adj.

	
 

	
  

	
 

	
$0.00 

	
 


	
 

	
Total
Cash

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
Non Cash
Principal Adjustments

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
Upgrades
Removed

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
Defaults
Removed

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
Cancellations
Removed

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
Other Contracts
Removed

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
Total
Credits

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
 

	
 

	
  

	
 

	
  

	
 


	
IV.

	
Receivables Aging Summary

	
 

	
  

	
 

	
  

	
 


	
 

	
00-30

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
31-59

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
60-89

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
90+

	
 

	
0 

	
 

	
$0.00 

	
 


	
 

	
Total

	
 

	
0 

	
 

	
$0.00 

	
 













	
 

	
 


	
Page 2

	
APRIL 1,
 2008





SERVICER REPORT FOR MONTH ENDING MARCH
31, 2008


	
 

	
 


	
(A)

	
Trial
 Balance


	
 


	
 

	
See Report SR410UR-02 (Monthly
 Trial Balance) for a listing of pledged receivables.


	
 

	
 


	
(B)

	
Collections


	
 


	
 

	
See
 Report SR410UR-03 (Cutoff Transaction Journal) for a listing of cash receipts
 collected/posted.


	
 

	
 


	
(C)

	
Fundings


	
 


	
 

	
See
 Report SR410UR-08 (Loans Added) for a listing of pledged receivables transferred in.


	
 

	
 


	
(D)

	
Paid in
 Full - Cancellation - Equity Trade - Default


	
 


	
 

	
See
 Exhibit A (Loans Removed) for a listing of pledged receivables paid in full and/or
 transferred out of portfolio.


	
 

	
 


	
(E)

	
Prepayments


	
 


	
 

	
See Report SR410UR-05 (Monthly
 Advance Report) for a listing of pledged receivables
 that are prepaid.


	
 

	
 


	
(F)

	
Past Due Information


	
 


	
 

	
See
 (Month End Delinquency Report) for a listing of pledged receivables that are past due. 





If you
have any questions or require additional information, please do not hesitate to
contact me 
at ______________________


Sincerely,


BLUEGREEN CORPORATION


	
 


	






Investor
Reporting


cc:







EXHIBIT K


List of Title Companies


	
 

	
 

	
 


	
 

	
Title Company

	
Jurisdiction(s)
 Covered


	
 

	
 

	
 


	
1.

	
Resort
 Title Agency, Inc.

	
Florida,
 Louisiana, Michigan, Missouri, New Jersey, Virginia, Wisconsin 


	
 

	
 

	
 


	
2.

	
McGee
 & Oxford

	
Georgia
 


	
 

	
 

	
 


	
3.

	
Chicago
 Title Insurance Company

	
Hawaii
 


	
 

	
 

	
 


	
4.

	
First
 American Title of Madison County, LLC

	
Montana
 


	
 

	
 

	
 


	
5.

	
First
 American Title Insurance, National Timeshare Division

	
Alabama,
 Nevada 


	
 

	
 

	
 


	
6.

	
Aldredge
 Law Firm

	
North
 Carolina, Rutherford County 


	
 

	
 

	
 


	
7.

	
Investors
 Title Insurance Company

	
North
 Carolina, Craven County 


	
 

	
 

	
 


	
8.

	
First
 American Title of Quakertown

	
Pennsylvania
 


	
 

	
 

	
 


	
9.

	
Surfside
 Title, Inc.

	
South
 Carolina, Horry County 


	
 

	
 

	
 


	
10.

	
Colonial
 Coast Title Agency, Inc.

	
South
 Carolina, Charleston County 


	
 

	
 

	
 


	
11.

	
Wilson
 & Bratt, P.A.

	
South
 Carolina, Beaufort County 


	
 

	
 

	
 


	
12.

	
Tennessee
 Valley Title Insurance

	
Tennessee
 


	
 

	
 

	
 


	
13.

	
Louisa
 Title

	
Virginia
 













EXHIBIT L


Form of
Servicing Agreement with Concord Servicing Corporation


See attached.


-3-







PROPRIETARY NOTICE


The
information contained in this documentation is subject to the confidentiality
provisions set forth in Paragraph 17 herein and may only be published,
reproduced, copied, or disclosed in accordance with the terms of Paragraph
17 herein. 







SERVICING AGREEMENT


          This
SERVICING AGREEMENT (“Agreement”) is made effective as of ______________, 200_,
by and among LIBERTY BANK, a
Connecticut non-stock mutual savings bank (“Lender”), CONCORD SERVICING CORPORATION, an Arizona
corporation (“Servicing Agent”), and _________________, a _________________ (“Borrower”). 


          WHEREAS,
Lender and Borrower have entered into a _______________ Agreement, dated
___________________, (as it may from time to time be amended, the
“Loan Agreement”), pursuant to which Borrower will, from time to time, assign
to Lender as collateral for the obligations of Borrower to Lender under the
Loan Agreement, timeshare loans and all payments due thereunder (the “Assigned
Accounts”) which now exist or may hereafter arise from purchase money financing
extended by Borrower to purchasers of timeshare interests in the timeshare
project known as __________________.


          WHEREAS,
Lender and Borrower desire that Servicing Agent perform, and Servicing Agent is
willing to perform, the services identified below with respect to the Assigned
Accounts, all upon the terms and conditions set forth below. 


          WHEREAS,
The parties hereto desire to enter into this Agreement for the purpose of
setting forth their final and complete understanding with respect to the
services to be performed by Servicing Agent in connection with the Assigned
Accounts. 


                    NOW,
THEREFORE, intending to be legally bound hereby, the parties hereto agree as
follows: 


                    1.          Servicing
Agent’s Duties. Servicing Agent will act with respect to the Assigned
Accounts as the exclusive servicing agent on behalf of Borrower and Lender and
will perform the setup, billing, processing, and reporting services described
in this Agreement and in Exhibit A attached hereto and made a part hereof,
including the following duties: 


                             
   1.1          Servicing Agent
will notify JPMorgan Chase Bank, N.A. (“Lockbox Agent”) of all Assigned
Accounts on a regular basis and in a timely fashion. 


              
                  1.2          The
Assigned Accounts shall consist of those timeshare loans which are identified
in writing by Lender and Borrower to Servicing Agent and assigned one or more
unique lender code designations on Servicing Agent’s loan servicing system
(“Lender Code(s)”). From time to time, the portfolios of timeshare loans
comprising the Assigned Accounts may be amended in writing by Lender and
Borrower by the addition of certain timeshare loans to, or the deletion of
certain timeshare loans from, the portfolio of Assigned Accounts. The
portfolios of Assigned Accounts are set forth on the attached Schedule A by
Developer/Lender Code designated on Servicing Agent’s loan servicing system, by
Lockbox Account(s) (defined in Paragraph 4 hereof) numbers and by the account
holder of each Lockbox Account(s). 


                                 1.3          Servicing
Agent will confirm to Lender in
writing, as requested by Lender, which accounts constitute Assigned Accounts,
and will inform Lender and Borrower of the Lender 



	
 

	
 


	
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Code(s)
designated on Servicing Agent’s loan servicing system for each segregated pool
of Assigned Accounts. 


                              1.4          Lender
may request Servicing Agent to designate separate and distinct Lender Codes for
segregated portfolios of Assigned Accounts, in which event Servicing Agent will
provide accounting information and reports to Lender and Borrower separately
for each such segregated portfolio of Assigned Accounts. 


                              1.5          Servicing
Agent will enter all Assigned Accounts on the Servicing Agent’s billing system
in a timely fashion. All loan debtors with respect to the Assigned Accounts
(“Obligors”) have been or will be directed to remit all payments to the
lockbox established by JPMorgan Chase Bank, N.A. (“Lockbox Agent”) pursuant to
a Lockbox Agreement among Borrower, Lender, Lockbox Agent, and Servicing Agent
for deposit into the Lockbox Account(s) 


                              1.6          Servicing
Agent will coordinate payment debits by Lockbox Agent on a monthly basis via
pre-authorized electronic debit on each Assigned Account so authorized, with
such payments to be deposited directly into the Lockbox Account(s). 


                              1.7          Servicing
Agent will promptly upon receipt by and notice from Lockbox Agent, post to the
Assigned Accounts records all amounts (“Payments”) of any kind (including,
without limitation, pre-authorized electronic credits) received on Assigned
Accounts, including, without limitation, principal, interest, late charge, and
pre-payment. 


                              1.8          Servicing
Agent will use reasonable efforts
to maintain complete and accurate records of all Payments and their application
to Assigned Accounts. 


                              1.9          Servicing
Agent will permit Lender, at the Borrower’s cost, to review and audit the
records maintained by Servicing Agent with respect to the Assigned Accounts and
the Payments thereon upon reasonable notice to Servicing Agent and during
Servicing Agent’s regular business hours. 


                              1.10        With
respect to each Assigned Account, Servicing Agent will send or has sent a
welcome letter or servicing disclosure statement (in compliance with applicable
law) and a monthly billing statement or annual coupon book to each such
Assigned Account’s Obligor not authorized for payment via pre-authorized
electronic debit. 


                              1.11        Servicing
Agent will not represent to any person that Servicing Agent owns any portion of
the Assigned Accounts. 


                              1.12        Servicing Agent will
keep Obligors informed of the proper place and method for making payments with
respect to the Assigned Accounts. 


                              1.13        Servicing Agent will
report tax information to Obligors as required by law. 


                              1.14        Servicing
Agent will take such other action as may be necessary or appropriate in the
discretion of the Servicing Agent for the purpose of collecting and
transferring to 



	
 

	
 


	
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the
Lockbox Account (as hereinafter defined) all payments received in respect of
Assigned Accounts (except as otherwise expressly provided herein), and to carry
out the duties and obligations imposed upon the Servicing Agent pursuant to the
terms of this Agreement, provided, however, that the Servicing
Agent may, in its discretion, waive any late fees in connection with delinquent
payments on an Assigned Account. 


                              1.15        Servicing
Agent will perform standard accounting services and general record keeping
services with respect to the Assigned Accounts. 


                    2.      
Borrower’s Duties. Borrower will perform the following duties:



                              2.1          Deliver
or cause to be delivered to Servicing Agent copies of the loan documents with
respect to each Assigned Account now existing or hereafter arising. 


                              2.2          Promptly
identify for Servicing Agent all Assigned Accounts. 


                              2.3          Verify
the accuracy and completeness of the documentation on all Assigned Accounts and
the files submitted to Servicing Agent, including authorizations for pre-authorized electronic debits. 


                              2.4          Endorse
and forward to Servicing Agent for subsequent delivery to the Lockbox Agent for
deposit any and all Payments received directly from all Obligors to be
processed through the Lockbox. 


                              2.5          Promptly
report to Lender and Servicing Agent the identity of those Assigned Accounts
whose assignment and/or collateral status has changed. 


                              2.6          Forward
to Servicing Agent all address changes, billing inquiries, correspondence, and
legal notices received concerning any Assigned Account. 


                              2.7          Promptly
notify Lender and Servicing Agent of any cancellation, assumption, quit claim,
foreclosure, deed in lieu of foreclosure, or settlement with respect to any
Assigned Account. 


                              2.8          Submit
to the Servicing Agent in a timely manner each of the Assigned Accounts,
including supporting documentation, current balance, and date of next payment,
in order to enable the Servicing Agent to arrange for the periodic billing of
the Assigned Accounts. 


                    3.     
Representations of Borrower.
As a condition to Servicing Agent’s performance of delinquency collections
services, Borrower warrants, represents and covenants that (i) the Obligors
under the installment sales agreements/promissory notes serviced by Servicing
Agent pursuant to this Agreement (the “Obligor Debt Instruments”) have an
unconditional obligation and are personally liable for the payment of all
amounts due under the Obligor Debt Instruments, and (ii) under the Obligor Debt
Instruments, Borrower has full recourse against such Obligors for failure to
make payment of such amounts and has the right to enforce, or attempt to
enforce such obligations through nonjudicial collection efforts or through
applicable legal or equitable proceedings. Upon request of Servicing Agent, 


	
 

	
 


	
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Borrower
will provide Servicing Agent with one or more sample sets of consumer documents
representative of the Obligor Debt Instruments serviced or to be serviced by
Servicing Agent under this Agreement. 


                    4.          Assigned
Account Payments. Lender, with the cooperation of Servicing Agent, shall
open and maintain one or more segregated bank accounts (the “Lockbox
Account(s)”) in the name of Lender, and all funds deposited therein shall be
the property of Lender. Servicing Agent shall designate the appropriate Lockbox
Account(s) number on payment coupons and other forms of payment received by the
Lockbox Agent in respect of the Assigned Accounts, or through electronic
transmission instruct the Lockbox Agent as to the appropriate Lockbox Account(s)
into which proceeds from payments in respect of the Assigned Accounts are to be
deposited, and direct Lockbox Agent to deposit into the appropriate Lockbox
Account(s) all payments received by Lockbox Agent in respect of the Assigned
Accounts. Servicing Agent shall notify Lender of such Lender Code designations
for the Assigned Accounts. Lender may request Servicing Agent to designate
separate and distinct Lender Codes to segregated portfolios of Assigned
Accounts, in which event Servicing Agent will provide accounting information
and reports to Lender separately for each such segregated portfolio of Assigned
Accounts. Neither Servicing Agent nor Borrower shall have the right to change,
close, or revise the Lockbox Account(s) or the Lockbox Account(s) number or the
Lender Code(s) except with the written consent of Lender, which consent may be
withheld, limited, or qualified in their sole and absolute discretion. Any
payments received by the Servicing Agent or the Borrower directly or
indirectly, including, without limitation, through credit card remittances,
direct deposits, wire-transfers or automatic debits, shall be held in trust
for Lender, subject to the continuing security interest granted to Lender in
the Loan Agreement, and each of them shall use best efforts to deposit such
payments in the Lockbox Account(s) no later than two (2) business days
following receipt thereof. Servicing Agent shall be the exclusive agent for
Lender with respect to holding or causing to be deposited any Payments from Obligors
to the Lockbox Account(s). The term “business day” means any day other than a
Saturday, Sunday, or a national, state, or local holiday. 


                    5.          Remittance
of Funds to Lockbox Account(s). If, despite directions to Obligors to make
all Payments on Assigned Accounts to the Lockbox Account(s), Servicing Agent or
Borrower receives any such Payments, then Servicing Agent or Borrower, as the
case may be, shall receive all such payments in trust for the sole and
exclusive benefit of Lender and shall, not later than the business day
following the date of receipt by the Servicing Agent or Borrower of any payment
by or on behalf of an Obligor with respect to an Assigned Account, deliver to
Lockbox Agent all such Payments in the form received as and when received.
Servicing Agent is authorized by Borrower to endorse, without recourse to
Lender, in the name of Borrower all instruments of payment. If, after a
returned instrument of payment is redeposited, it is returned again, Servicing Agent
shall forward such instrument of payment to Borrower, or, if requested by
Lender in writing, to Lender, and Servicing Agent shall have no further
obligation for the collection of such instrument of payment. Postdated checks
will be held and forwarded by Servicing Agent to the Lockbox Account in
accordance with Servicing Agent’s standard procedures. 


                    6.          The
Servicer Report. Within the first ten days of each month (or if such day is
not a business day, the business day immediately following such ten days) (the
“Report Date”), Servicing Agent, as provided in Exhibit A, shall deliver to the
Borrower and Lender all the information and reports required to be provided
pursuant to Exhibit A (the “Servicer Report”). The Servicer 


	
 

	
 


	
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Report shall
be completed with the information specified therein as of the last day of the
immediately preceding month and shall contain such other information as may be
reasonably requested by the Borrower or Lender in writing at least three (3)
business days prior to such Report Date and for a fee for such other
information as set forth in Exhibit B attached hereto. In addition, upon
request of Lender, Servicing Agent shall deliver to Lender at the address to
which notices are to be sent to Lender, pursuant to subparagraph 20.4, a
current list of the names, addresses and phone numbers of each of the obligors
of the Assigned Accounts. 


                    7.          Modifications.
Notwithstanding anything to the contrary in this Agreement (except for the waiver
of late fees provided for in subparagraph 1.14 hereof), the Servicing Agent
shall not modify, waive, or amend the terms of any Assigned Account or permit
the same to be assumed except as authorized in advance in writing by Borrower
and by Lender. 


                    8.          Records.
Servicing Agent shall maintain all data (including, without limitation,
computerized tapes or disks) relating directly to or maintained in connection
with its duties in servicing of the Assigned Accounts (which data and records
shall be clearly segregated to reflect that the Assigned Accounts have been
pledged to and constitute collateral of the Lender) at the address of the
Servicing Agent set forth in subparagraph 20.4 hereof or upon fifteen (15)
days’ notice to the Lender and the Borrower, at such other place where the
servicing activity of the Servicing Agent is located, and shall give the Lender
and the Borrower or their authorized agents access to all such information at
all reasonable times, upon seventy-two (72) hours’ written notice. 


                    9.          Standard
of Care/Performance of Services. Servicing Agent agrees to perform the
services to be furnished by it under this Agreement in a commercially
reasonable manner, and shall exercise that same degree of care it exercises on
behalf of other borrowers with respect to the administration and servicing of
similar loans and notes. Servicing Agent shall not be deemed in breach of this
Agreement if its failure to perform is the result of acts of God, war, civil
commotion, governmental action, fire, explosion, strikes, other industrial
disturbances, action, non-action, or other matters beyond Servicing Agent’s
reasonable control if in such case Servicing Agent follows commercially
reasonable practice to (i) avoid such failure and (ii) after any such failure,
provides notice thereof to Borrower and Lender and responds to such situation
in a commercially reasonable manner. Servicing Agent shall not be liable for
any acts of commission or omission in connection with this Agreement, except
for Servicing Agent’s gross negligence or willful misconduct. Notwithstanding
anything herein contained to the contrary, Servicing Agent shall not be liable
for consequential, incidental, special or punitive damages arising in
connection with the performance of its duties hereunder. 


                    10.        Compliance
with Law. Servicing Agent agrees that it will use its best efforts at all
times, in the course of performing services hereunder, to be in material compliance
with all applicable laws and regulations promulgated by any federal, state, or
local governmental entity which are applicable to the services performed by
Servicing Agent hereunder. Servicing Agent shall not be requested or required
to perform any service which shall be contrary to applicable laws and
regulations. 


                    11.        Conflicting
Demands. If conflicting demands are made or notice served upon Servicing
Agent by a third party, or if legal action is taken in connection with this
Agreement, 



	
 

	
 


	
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Servicing
Agent shall not be required to make any determination or take any action but
may stop all further proceedings in conjunction with the disputed matter
without liability therefor after providing notice thereof to Borrower and Lender;
or, at Servicing Agent’s option, may file suit in interpleader or for
declaratory relief. The Borrower shall indemnify and hold Servicing Agent
harmless from all costs, damages, and reasonable legal fees expended or
incurred by it in conjunction with any such matter. Further, Servicing Agent
shall not have liability to Borrower or to Lender if Servicing Agent acts in
good faith in accordance with an order entered by a court of competent
jurisdiction or other competent authority. Notwithstanding anything herein or
elsewhere to the contrary, in the event of any conflicting demands upon the
Servicing Agent by Borrower and Lender, Servicing Agent is hereby authorized
and directed to follow the demands of Lender. 


                    12.          Indemnity.



                                   12.1          The
Borrower will indemnify and hold the Servicing Agent and Lender (each an
“Indemnitee”) harmless and defend for, from, and against any and all claims,
liabilities, fees, losses, costs, and damages incurred in connection with this
Agreement, unless such liabilities, fees, losses, costs, and expenses shall
arise from the Indemnitee’s gross negligence or willful misconduct in the
performance of its duties hereunder.  


                                   12.2          In
the event the Servicing Agent intervenes in or becomes a party or is made a
party to any action or proceeding arising in connection with this Agreement in
order to protect its rights, the Servicing Agent may at its option rely on the
Borrower to defend it or at any time may retain its own legal counsel. Other
than in connection with a legal proceeding instituted by the Borrower against
the Servicing Agent and Lender, in the event the Servicing Agent retains its
own legal counsel, the Borrower shall pay the reasonable fees of the Servicing
Agent’s legal counsel therein and any other reasonable costs incurred in such
proceeding. 


                                   12.3          Borrower
agrees to indemnify, hold harmless and defend Servicing Agent from and against
all claims, charges, liabilities, fees (including without limitation, discount
and service fees for credit card processing), losses, costs, expenses, and any
items, including, without limitation, any automated clearinghouse transactions
or other electronic funds transfers (collectively, “Electronic Funds Payments”)
and credit card transactions which are returned or charged back for any reason
and adjustment associated with, arising from, or related to the maintenance by
Servicing Agent of any merchant account or demand deposit bank account used in
whole or in part by Servicing Agent to receive and process Electronic Funds
Payments or credit card payments from Obligors whose accounts are being
serviced by Servicing Agent under this Agreement (collectively “credit Card and
EFT Chargebacks”). Borrower and Lender agree and acknowledge that Servicing
Agent shall have no obligation to process credit card payments from Obligors
utilizing Servicing Agent’s merchant account unless Servicing Agent agrees in
writing to do so. 


                                   12.4          To
the extent Electronic Funds Payments and/or credit card payments have been
credited to the Lockbox Account(s) or any new, additional or substitute bank
accounts for the benefit of Lender, notwithstanding anything to the contrary
elsewhere contained in this Agreement, Lender acknowledges the right of
Servicing Agent and/or the merchant account processor (“Credit Card Processor”)
to debit or withhold funds otherwise to be credited to the Lockbox Account(s)
from time to time for any Credit Card and EFT Chargebacks attributable to such
Electronic 





	
 

	
 


	
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Funds Payments
and credit card payments. To the extent there are insufficient funds in the
Lockbox Account(s) at any time (including any Lockbox Account(s) that have been
closed) or funds belonging to Lender in any bank accounts maintained by
Servicing Agent in whole or in part for the benefit of Lender, to fully offset
any Credit Card and EFT Chargebacks of credit card payments and EFT Payments
processed by Servicing Agent on behalf of Borrower and Lender with respect to
this Agreement, Lender agrees to pay Servicing Agent for all Credit Card and
EFT Chargeback amounts Servicing Agent is required to pay the (i) Credit Card
Processor pursuant to the provisions of any credit card processing agreement
between Servicing Agent and the Credit Card Processor (“Card Processing
Agreement”) or (ii) financial institutions(s) at which the aforesaid bank
accounts of Servicing Agent were opened, provided that, (a) Borrower has not
reimbursed Servicing Agent for such amount within three (3) business days of
request for reimbursement and (b) the Lender has previously received the
proceeds represented by such Credit Card and EFT Chargeback amounts. Lender
shall reimburse Servicing Agent for all such amounts within fifteen (15) days
after written request therefor, which request shall include supporting
documentation. Servicing Agent and Lender agree that such payment obligation of
Lender shall be applicable only to the extent that the funds from credit card
payments and EFT Payments to which any Credit Card and EFT Chargebacks relate
have been received in the Lockbox Account(s) or any substitute, new or
additional bank accounts for the benefit of Lender. 


                                        12.5          Notwithstanding
any other provisions contained in this Agreement, including the provisions of
this Paragraph 12, each of Borrower and Lender hereby acknowledges the right of
the Credit Card Processor to establish at any time and from time to time,
pursuant to the provisions of the Card Processing Agreement, one or more
reserve funds in such amounts as the Credit Card Processor deems appropriate in
its sole and absolute discretion, to secure the Credit Card Processor with
respect to any or all of the merchant accounts established by Servicing Agent
with the Credit Card Processor to process credit card payments on behalf of
Borrower and Lender under this Agreement.. Any such reserve fund may be
established, in Credit Card Processor’s sole discretion, by withdrawing funds
on deposit in the Lockbox Accounts or by withholding funds otherwise to be
credited to the Lockbox Accounts. 


                    13.          Fees
and Expenses. 


                                        13.1          The
Borrower shall pay the Servicing Agent’s fees as set forth in Exhibit B, a copy
of which is attached hereto and made a part hereof. The Servicing Agent shall
invoice the Borrower on a monthly basis for fees and expenses. Payment shall be
made to the Servicing Agent by the twentieth (20th) day of the month in which
the invoice is received. The failure of Borrower to pay any such amount to
Servicing Agent by the due date shall be deemed a default of this Agreement as
that term is used in subparagraph 18.1 hereof, and shall be subject to a late
charge equal to the greater of 1-1⁄2% of the past due amount per month or $50.00
per month. It is agreed and understood by Borrower that all amounts received by
Servicing Agent as payment for services performed shall be applied first to the
most recent unpaid invoice, and thereafter to any unpaid amounts on prior
invoices, beginning with the most recent invoice. All fees and expenses owed to
Servicing Agent under this Agreement shall be the sole obligation of Borrower,
and Lender shall have no liability for such fees and expenses, except as
provided in subparagraph 13.2 below. 





	
 

	
 


	
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                                   13.2          Anything
in this Agreement to the contrary notwithstanding, in the event Borrower fails,
from time to time, to make timely payment of fees and expenses due and owing to
Servicing Agent under this Agreement (“Past Due Amounts”), and written notice
of any such nonpayment is given at any time by Servicing Agent to Lender,
Lender shall have a period of fifteen (15) days from the date of such notice to
attempt to cause Borrower to pay Servicing Agent all Past Due Amounts. In the
event any payments hereunder by Borrower to Servicing Agent are determined, in
any bankruptcy or similar proceeding, to be a preferential transfer and
Servicing Agent is required by a court order to return such payment(s) to a
trustee or to the estate of the Borrower in bankruptcy (“Returned Payment(s)”)
and notice of such Returned Payment is given to Lender by Servicing Agent,
Lender shall have the obligation and agrees to reimburse Servicing Agent for
all such Returned Payment(s) as hereinafter provided in this subparagraph 13.2
(except to the extent that such Returned Payment(s) include late charges or the
termination fee specified in “II. Receivables” set forth in Exhibit B hereto
(“Termination Fee”)). Servicing Agent shall have the right and Lender hereby
authorizes Servicing Agent to debit the Lockbox Account(s) at any time
beginning fifteen (15) days after notice to Lender for all such Past Due
Amounts remaining unpaid by Borrower (excluding late charges) and/or for
reimbursement of all Returned Payments. To the extent there are insufficient
funds in the Lockbox Account(s) at the time Servicing Agent attempts to debit
such accounts to pay all of the amounts described in the preceding sentence,
Lender, after written request by Servicing Agent, shall have the obligation
within fifteen (15) days thereafter to pay Servicing Agent all such unpaid
amounts (excluding late charges). Any payments paid by Lender under this
Agreement shall become obligations of Borrower under the Loan Agreement.
Notwithstanding anything to the contrary herein contained, if subsequent to
payment by Lender to Servicing Agent of amounts payable to Servicing Agent
hereunder (other than late charges and the Termination Fee), whether through
the debiting of the Lockbox Account(s) or directly paid by Lender, Lender
elects to terminate this Agreement for any reason, Servicing Agent hereby
waives the right to payment of the Termination Fee, provided that such waiver
of the late charges or the Termination Fee shall not be applicable to a
termination of this Agreement by Borrower. 


                    14.          Use
of Proceeds. Borrower irrevocably authorizes Lender to (a) use the Payments
or (b) make advances under the Loan Agreement to pay fees, costs, expenses, and
other obligations owed to Servicing Agent under this Agreement. Except as
otherwise expressly provided in subparagraph 12.4 and subparagraph 13.2 nothing
herein shall be construed, however, as making the payment of said fees, costs,
expenses, or other obligations obligatory upon Lender, and Lender shall not be
liable for any loss or damage resulting from non-payment of such fees, costs,
expenses, or other obligations. 


                    15.          Waiver
of Set-off. Except as herein otherwise expressly provided, Servicing Agent
waives any and all rights of set-off, deduction, recoupment, attachment,
garnishment, or otherwise it may have on account of any indebtedness owing to
it by Borrower against the items of payment or collections thereof which are
the subject of this Agreement. 


                    16.          Financial
and Other Information. Servicing Agent will deliver to Lender, in form and
content satisfactory to Lender, the following: 


                                   16.1          Upon
request by Lender and the later to occur of (a) ten (10) days from the date of
such request or (b) one hundred twenty (120) days after the end of the fiscal
or calendar year for




	
 

	
 


	
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which such
request is made: (1) the income and retained earnings statement of Servicing
Agent for such year; (2) the balance sheet of Servicing Agent as at the end of
such year; and (3) the statement of cash flow of Servicing Agent for such year,
subject to compliance by Lender with the confidentiality and non-disclosure
terms of that certain Letter Agreement, dated October 17, 2000, between Lender
and Servicing Agent. 


                                   16.2          Evidence
of Servicing Agent’s then existing insurance coverage for errors and omissions
and, within thirty (30) days prior to the expiration date of the current
policy, any renewal thereof. 


                    17.          Computer
Software/Other Proprietary Information. In the event Borrower or Lender has
access to Servicing Agent’s respective systems, software programs, video screen
layouts, formats, user manuals, and database descriptions or file definitions
(hereinafter collectively referred to as “Software”), either through
direct computer inquiry or any other means, Borrower and Lender agree and
acknowledge that the Software is proprietary to Servicing Agent and
confidential. Borrower and Lender further acknowledge and agree that the
pricing information in Exhibit B, the other terms and conditions, and the
monthly reports provided to each of them under this Agreement are also
proprietary and confidential (“Additional Confidential Information”). Borrower
and Lender agree under no circumstances to transfer Software from the system of
Servicing Agent to any other system, to reproduce all or any part of it, or to
use the Software except as provided herein. 


                                   Borrower
and Lender agree to restrict disclosure of the Software solely to those of
their employees that need to know and shall not disclose such Software, nor
show how the Software functions, to any third parties without Servicing Agent’s
prior written consent. Except with Servicing Agent’s prior written consent,
Borrower and Lender shall not disclose any Additional Confidential Information
to any person, firm, corporation, or other entity except (a) those of their
employees that need to know and (b) Borrower’s or Lender’s accountants,
lenders, state and federal bank examiners, and attorneys, (“Third Party”) but
only to the extent that any such disclosure to a Third Party is required by,
and is essential to, a regulatory, financial, or legal relationship between
Borrower and Lender and such Third Party and that such Third Party has a
genuine need to know and, provided further, that each such Third Party
recipient agrees to be bound by the aforesaid confidentiality requirement. 


                    18.          Term/Termination.


                                   18.1          This
Agreement shall remain in effect unless terminated for any reason either in
whole or in part upon not less than ninety (90) days’ written notice by either
party to the other parties or, in the event of a default, upon notice as
provided below. Notwithstanding anything to the contrary contained in this
Agreement, Borrower shall not be permitted to terminate this Agreement without
the prior written consent of Lender. Termination shall include, but not be
limited to, the transfer of all or part of the servicing to any party other
than Servicing Agent. Subject to the provisions of subparagraph 13.2 hereof, in
the event of termination of this Agreement or in the event of non payment of
fees owed to Servicing Agent by Borrower (or if Servicing Agent is not paid
such past due amount through debiting of the Lockbox Account(s) or directly by
Lender as provided in Paragraph 13 hereof), except if such termination or non
payment of fees occurs solely as a result of a material default hereunder by
Servicing Agent, Servicing Agent will not be obligated to turn over the 





	
 

	
 


	
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documents,
records, and files or to provide servicing under this Agreement until all of
its fees are paid, including the fees set forth in Exhibit B. Upon a
default of this Agreement, any non-defaulting party
directly impacted by such default may terminate this Agreement upon (a) fifteen
(15) days’ prior written notice to
the other parties specifying such default and (b) failure by such defaulting
party to cure such default within
such fifteen (15) day period. Failure by Borrower to make any payment required to be made by it hereunder when due
shall be deemed a default.


                     
              18.2         
Notwithstanding the provisions of subparagraph 18.1 above, this Agreement may be terminated by Lender upon
Borrower’s complete performance and fulfillment of all its obligations under the Loan Agreement and
secured by the Assigned Accounts, which termination shall become
effective not earlier than sixty (60) days after written notice of such
fulfillment and performance is given to
Servicing Agent by Lender.


                    19.
          Effect
of Termination.


                     
              19.1         
Upon termination of this Agreement,
Servicing Agent shall be entitled to all fees
and expenses (a) that have accrued and that are owing to Servicing Agent as of
the effective date of such termination and (b) that are otherwise due
Servicing Agent under this Agreement other than
late charges and the Termination Fee waived by Servicing Agent pursuant to the
provisions of subparagraph 13.2 hereof. Upon the payment to Servicing Agent of
all such fees and expenses by Borrower
or by Lender through the debiting of the Lockbox Account(s) or directly by
Lender, Servicing Agent will make available to Lender and Borrower all
data, documents, records, and files necessary for an orderly takeover at the
time of termination of this Agreement or appointment of a successor to Servicing Agent regardless of the reason
for such
termination or appointment, including without limitation, providing to
Lender and Borrower copies of all files with respect to the Assigned Accounts in the format maintained by
Servicing Agent, all
supplies and other properties of Lender or Borrower, and, to the extent
practicable, copies of all media on which data supplied by Lender, Borrower, or
Servicing Agent is stored for processing
under this Agreement (collectively the “Conversion Data”).


                     
             19.2          
Notwithstanding anything herein to the
contrary, no termination fees otherwise
payable hereunder shall be due and payable to Servicing Agent if this Agreement
has been terminated by Servicing
Agent (except in the event of nonpayment of fees and expenses to Servicing Agent constituting a breach of this
Agreement
which has not been cured during the cure period provided in subparagraph
18.1 hereof) or this Agreement has been terminated by Lender, Borrower (with Lender’s written consent), due
to a default
by Servicing Agent under this Agreement, which default has not been cured in accordance with the provisions of
subparagraph 18.1 hereof.


                     
             19.3          
The provisions of Paragraphs 12.
[Indemnity], 13. [Fees and Expenses], and 17. [Computer Software/Other Proprietary Information] shall survive any
termination or expiration of this Agreement.


                    20.          Miscellaneous.


                     
             20.1          
Assignment. This Agreement may not be assignable by Borrower without the
written consent of Servicing Agent; provided, however, Borrower may assign this
Agreement to Lender without Servicing
Agent’s consent.


	
 

	
 


	
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             20.2          
Choice of Law/Venue/Attorneys
Fees. In the event a legal
proceeding is initiated to enforce any of the terms of this Agreement, the
prevailing party or parties shall be entitled to receive from the other
party or parties to such litigation the reasonable attorney’s fees, costs, and expenses incurred in the
action by the prevailing
party. Unless prohibited by the applicable bankruptcy court, or by applicable law, in the event that Borrower
files
a petition for relief under the United States Bankruptcy Code or becomes
the subject of an involuntary proceeding thereunder, Servicing Agent shall be entitled to its reasonable
attorney’s fees,
costs and expenses incurred in any such
proceeding. This Agreement shall be governed by and interpreted in accordance
with the internal laws of the State
of Arizona, without regard to its rules and principles regarding conflicts of laws or any other rule or canon of
construction
which interprets agreements against the draftsman. Any such litigation
shall be initiated in a state or federal court located in the State of Arizona,
County of Maricopa, and each of the parties
hereto hereby consents to the personal jurisdiction of the federal and state courts of Arizona. In the event there
is litigation between Borrower and Lender to which Servicing Agent is
not a party, it is agreed that the foregoing choice of law, venue and
consent-to-personal jurisdiction provisions
in this subparagraph 20.2 shall not be applicable.


                     
             20.3          
Litigation Involving Assigned
Accounts. In the event any legal
action or other proceeding is brought
relating to any of the Assigned Accounts, Servicing Agent will deliver to Lender,
promptly after Lender’s request therefor, such papers as Servicing Agent may
have in its possession and Lender in its
sole discretion deems relevant to such action.


                     
             20.4          
Notice. No notice, request, demand, or instruction to be
given hereunder to any party shall
be effective for any purpose unless in writing and personally delivered to the
person and at the appropriate address
set forth below (in which event, such notice shall be deemed effective only
upon such delivery) or when delivered by mail, sent by registered or certified
mail, return receipt requested, as
follows:


	
 

	
 

	
 

	
 

	
 


	
 

	
If to Lender:

	
Liberty Bank 


	
 

	
 

	
Attn:

	
 

	
 


	
 

	
 

	
 

	



	
 

	
 

	
315 Main Street


	
 

	
 

	
Middletown, CT 06457


	
 

	
 

	
Fax. (860) 344-9217


	
 

	
 

	
 

	
 

	
 


	
 

	
If to Borrower:

	
 

	
 

	
 


	
 

	
 

	



	
 

	
 

	
 


	
 

	
 

	



	
 

	
 

	
 


	
 

	
 

	



	
 

	
 

	
 

	
 

	
 


	
 

	
 

	
Attn:

	
 

	
 


	
 

	
 

	
 

	



	
 

	
 

	
Telephone:

	
 


	
 

	
 

	
 

	



	
 

	
 

	
Fax: (     )


	
 

	
 

	
 

	
 

	
 


	
 

	
If to Servicing Agent:

	
Concord Servicing Corporation


	
 

	
 

	
Highland Park Building 


	
 

	
 

	
4725 North Scottsdale Road,
 Suite 300 


	
 

	
 

	
Scottsdale, Arizona 85251








	
 

	
 


	
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Attn: Frederick G. Pink


	
 

	
 

	
Telephone: (480) 998-7585


	
 

	
 

	
Fax: (480) 281-3141





                     
                               Notice
shall be deemed to have been given upon the earlier to occur of (a)
receipt or (b) forty-eight (48) hours after the deposit of same in any United
States Post Office box, postage prepaid, as
set forth above. The addresses and addressees for the purpose of this paragraph may be changed by giving written
notice
of such change in the manner herein provided for giving notice. Unless
and until such written notice of a change or address or addressee is received, the last address and addressee, as
stated by
written notice, or provided herein if no written notice of change has been sent
or received, shall be deemed to continue in effect for all purposes hereunder.


                     
             20.5          
Modification. This Agreement exclusively and completely states
the rights and obligations of the
parties with respect to the subject matter herein contained. No modification, variation,
termination, discharge, abandonment, or waiver of any of the terms or
conditions of this Agreement shall be valid
unless in writing and signed by the parties to this Agreement.


                     
             20.6         
Binding Effect. This Agreement shall inure to the benefit of and
be binding upon the parties to this
Agreement and their successors and assigns.


                     
             20.7          
Severability. If any one or more of the provisions contained in
this Agreement shall be held invalid, illegal, or unenforceable in any
respect, the validity, legality, and enforceability
of the remaining provisions contained in this Agreement shall not in any way be
affected or impaired thereby.


                     
             20.8         
Interpretation. All headings are inserted for convenience only
and shall not affect any construction
or interpretation of this Agreement. The provisions of this Agreement shall apply to the parties according to
this context
and without regard to the number or gender of words and expressions used in them. Unless otherwise
indicated, all references in this Agreement to paragraphs, clauses, and other subdivisions of this Agreement
refer to
the corresponding paragraph, clause,
and other subdivisions of this Agreement; the words “herein,” “hereof,”
“hereto,” “hereunder,” and words of
similar import refer to this Agreement as a whole and not to any particular
paragraph, clause or other
subdivision; and reference to a numbered or lettered subdivision of a paragraph
shall include relevant matter within
the paragraph which is applicable to but not within such numbered or lettered
subdivision. All schedules and Exhibits referred to in this Agreement are
incorporated in this Agreement by
reference.


                     
            20.9          
Counterparts; Facsimile
Signatures. This Agreement and
any other document collateral hereto may be executed in any number of
counterparts, each of which when so executed
and delivered shall be deemed to be an original without the production of any
other counterpart. Any signature on
this Agreement or any document collateral hereto, whether delivered by a party by facsimile transmission, or
reproduced
by machine copy, shall be deemed to be an original signature thereto.



	
 

	
 


	
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(Signature Page Follows)



	
 

	
 


	
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                    IN
WITNESS WHEREOF, this Agreement has been executed effective as of the date
set forth
above.


	
 

	
 

	
 

	
 


	
 

	
“LENDER”

	
LIBERTY BANK


	
 

	
 

	
 

	
 


	
 

	
 

	
By:

	
 


	
 

	
 

	
 

	



	
 

	
 

	
 

	
(Signature)


	
 

	
 

	
 

	
 


	
 

	
 

	
 

	



	
 

	
 

	
 

	
(Print Name/Title)


	
 

	
 

	
 

	
 


	
 

	
 

	
 

	
 


	
 

	
“BORROWER”

	
 

	
 


	
 

	
 

	



	
 

	
 

	
 

	
 


	
 

	
 

	
By:

	
 


	
 

	
 

	
 

	



	
 

	
 

	
 

	
(Signature)


	
 

	
 

	
 

	
 


	
 

	
 

	
 

	



	
 

	
 

	
 

	
(Print
 Name/Title)


	
 

	
 

	
 

	
 


	
 

	
“SERVICING AGENT”

	
CONCORD SERVICING CORPORATION


	
 

	
 

	
 

	
 


	
 

	
 

	
By:

	
 


	
 

	
 

	
 

	



	
 

	
 

	
 

	
Frederick
 G. Pink


	
 

	
 

	
 

	
Vice
 President & General Counsel








	
 

	
 


	
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EXHIBIT A


SERVICING


Servicing Agent will act as agent for
and on behalf of
Borrower in rendering the specific services for Obligor account
management and administration as set forth in the Agreement and herein, and at
the fees
shown in Exhibit B.


The
following is a description of the services to be provided by Servicing Agent.


1.       Conversion. (if
applicable)
Servicing Agent will determine the method of the data base conversion best suited
to process data from existing records. Such processing may include tape and/or manual conversion
methods depending on the source of information. Data shall be transferred and conversion reports
prepared as required by Servicing Agent.


2.       New Sales or Maintenance Fee
Transmittals,
Receivables Set-up, and Obligor Billing.


          a.          Periodically,
Borrower may transmit new sales and
receivables data and/or maintenance fee data to Servicing Agent. Such sales and
receivables data and/or maintenance data shall consist of copies of documents that provide sufficient
information to enable Servicing Agent to adequately perform its servicing duties.


          b.          Each
group of such data shall be sent to Servicing
Agent with a pre-numbered and dated transmittal form, to be supplied by
Servicing Agent, identifying each sale and/or maintenance fee contract being transmitted.


          c.          For
those Obligors to whom loan payment coupons or
statements are to be sent, within a reasonable
period after receipt of necessary information relating to new sales, Servicing
Agent will make necessary
arrangements to forward to such Obligors loan payment coupons with return
address labels or, if provided for in Exhibit B, and if instructed to do so by
Borrower in writing, a statement. Periodically thereafter, if payment coupons are to be sent, a set of
payment coupons
with return address labels or a statement,
if provided for in Exhibit B and if instructed to do so by Borrower in writing,
will be sent to each Obligor
account.


3.       Obligor Payment
Processing/Credit Card
Processing.


          a.          Servicing
Agent will apply Obligor payments to
Servicing Agent’s system. Obligor payments
are generally posted to their accounts each business day with application to
interest, late charge (if
applicable), principal, and/or any other appropriate application. A
reconciliation of cash applied and
deposited is performed. It is Servicing Agent’s policy to accept and hold
postdated checks and other forms of
payment that are postdated no more than five days and to send to Borrower for appropriate action or return
to Obligor checks and
other forms of payment postdated more than five (5) days;


          b.          for
Obligors who are on auto debit or credit card
payment arrangements, if applicable, appropriate
debit or credit card arrangements will be made. Servicing Agent agrees to use
its merchant


	
 

	
 


	
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account(s) and to use Credit Card
Processor to process
credit cards transactions. Servicing Agent will endeavor to establish
such merchant accounts subject to the provisions of this Paragraph 3 of Exhibit
A and the provisions of Paragraph 12 of this Agreement.


          c.          Servicing
Agent, in its sole discretion, upon written notice to Borrower and Lender, at
any time
shall have the right to immediately cease processing credit card payments
through its merchant accounts in the event that (1) Servicing Agent believes, in the
exercise of its business judgment, that (A) Credit Card and EFT Chargebacks pertaining to the
credit card payments or Electronic Funds Payments of Obligors have reached
unacceptable levels, or (B) there exists any circumstances which may increase Servicing
Agent’s exposure for Credit Card and EFT Chargebacks or otherwise presents a
financial or security risk to Servicing Agent, or (2) (A) Servicing Agent’s
Credit Card Processor elects to terminate Servicing Agent’s merchant account capability
for processing credit card payment transactions for any reason, or (B) Borrower or Lender refuses,
within fifteen (15) days after written request therefor by Servicing Agent, to
promptly deposit monies with Servicing Agent for a reserve fund, or permit Servicing Agent to
establish a reserve fund from monies on deposit in, or from funds otherwise to
be credited
to the Lockbox Accounts, in such amounts as Servicing Agent determines to be
necessary or appropriate
to cover actual or estimated future Credit Card and EFT Chargebacks, or (C) the
financial institution
elects to terminate Servicing Agent’s capability to process Electronic Funds
Payments with respect to those bank accounts where the Electronic Funds Payments
heretofore had been credited, or (D) Borrower or Lender files a petition for relief under
the United States Bankruptcy Code or becomes the subject of an involuntary proceeding
thereunder.


          (d)          Notwithstanding
the provisions contained above in this paragraph 3, Servicing Agent, in its sole and absolute
discretion, at any time and for any reason, may elect to discontinue processing
credit card payments through its merchant accounts by giving Borrower and
Lender not less than ninety (90) days prior written notice of its intention to cease such
processing of credit card payments.


4.       Obligor
Inquiries and File Maintenance. All Obligor
correspondence pertaining to account servicing will be handled routinely in a manner
consistent with Servicing Agent’s standard policies and procedures. Furthermore,
Servicing Agent will process and update all changes of address and account data consistent with
Servicing Agent’s standard policies and procedures.


5.       Obligor
Delinquent Account Processing and Collections. If agreed to between
Borrower and Servicing Agent and
for a fee or fees listed in Exhibit B, Servicing Agent will perform delinquency
collections as described in Exhibit C, and
Credit Reporting to Equifax Credit Information Services, Inc., Experian Credit Data Southwest, Inc., and
Trans
Union Credit Information Company as described in Exhibit D. The fees for collections set forth in Exhibit
B assume
Borrower provides Servicing Agent with telephone
numbers and addresses for at least 90% of those accounts on which collections
are to be performed and that all
accounts on which collections are to be performed are of individuals located in
the United States. Fees for
collections for accounts residing in Canada and other locations outside the United States are as set forth
in Exhibit B
(including any amendment thereto).


6.
       Cancellations. Cancellations
will be
processed in accordance with Borrower’s semimonthly instructions as agreed
upon in writing by Servicing Agent and Borrower.


	
 

	
 


	
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7.       Year-End
Reporting. Provided, as of January 31 of each calendar year
following the calendar year in which this Agreement is executed, this Agreement
is still in effect and, in addition, notice of termination as provided in Paragraph 18 of this
Agreement has not been given by any signatory hereto, Servicing Agent will, on
behalf of Borrower do as described below.


          a.          Provide
a year-end loan interest statement indicating
the total amount of interest paid by each
obligor whose contract is being serviced by Servicing Agent. This interest
statement shall be for interest paid January 1 through December 31 of
the prior year, or from the date such purchaser’s account was set up on Servicing Agent’s
receivables system, if later
than January 1 of the prior year, through
December 31 of the prior year. Upon request of Borrower, Servicing Agent may
agree to include in the interest
statement interest paid by an obligor prior to the date the account was set up
on Servicing Agent’s receivables
system, but Servicing Agent shall have no responsibility for the accuracy of information regarding such
interest paid furnished
to Servicing Agent by Borrower or any prior servicer of the account.


          b.          Send
to the Internal Revenue Service a magnetic
tape reflecting interest paid during the calendar year for those above accounts on which the amount of
interest
paid is required by law to be reported
along with appropriate Social Security numbers, if available, if and as
Borrower is required to do so by
federal income tax law and if requested to do so in writing by Borrower. Such
reporting will be done using
Borrower’s tax I.D. number, and Borrower agrees to provide Servicing Agent with
such tax I.D. number. If the annual
year-end interest statement is sent separate from the annual coupon book for any reason (for example,
because the Borrower
requests coupon books be sent to purchasers in a month other than January) or is sent because there is no
payment coupon
book being sent by Servicing Agent
(for example, for paid-in-full or canceled contracts), there will be a separate
charge of $1.50 plus postage per
year-end interest statement.


8.       Reporting. The
following are the basic monthly reports provided by Servicing Agent
to the Borrower and Lender. These reports will be provided on
diskette or will be sent via e-mail, at the direction of the
Borrower. Other reports are available as agreed upon in writing by Servicing
Agent and Borrower
or Lender and at an agreed upon fee.


	
 

	
 


	
 

	
In the case of installment receivables
 servicing:


	
 

	
 


	
 

	
Standard
 Daily Download


	
 

	
Summary
 Transaction Activity


	
 

	
Detail
 Cash


	
 

	
Detail
 Non-Cash


	
 

	
New
 Sales


	
 

	
Canceled


	
 

	
Lender
 Change


	
 

	
Paid
 in Full


	
 

	
Reinstatement


	
 

	
Refinance


	
 

	
Assumptions


	
 

	
Trial
 Balance


	
 

	
Summary
 Delinquency


	
 

	
Detail
 Delinquency







	
 

	
 


	
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Bank
 Balancing 


	
List
 of Contracts 


	
Report
 of Invalid Phone Numbers





9.       Lockbox Accounts.
All funds from accounts being processed by
Servicing Agent will be deposited into a bank account or bank accounts (“Lockbox
Account(s)”) established by Lender at JPMorgan Chase Bank, N.A., or other bank
acceptable, in writing, to both Lender and Servicing Agent.


10.     Termination/Transfer
of Servicing. Upon termination for any reason of Servicing
Agent’s servicing duties hereunder and the payment of the termination fee to
Servicing Agent as set forth in Exhibit B hereof, Servicing Agent will assist Borrower or
Lender in the transfer of servicing to another servicer provided that all fees due Servicing
Agent under this Agreement have been paid in advance of such transfer. As part
of such transfer, if requested by Borrower or Lender, Servicing Agent will also
prepare
and send to Obligors serviced under this Agreement written notice of transfer
of servicing for an additional fee of $1.50 per notice letter plus cost of
postage.


	
 

	
 


	
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EXHIBIT B 


FEES


Servicing Fees and
Expenses. The following fees will
be charged to Borrower by Servicing Agent. They are in U.S. dollars unless
otherwise stated in writing. On or after each anniversary date of this Agreement (“Anniversary
Date”), the fees may automatically increase by an amount equal to one and one-half times the
increase in the Consumer Price Index for the twelve-month period immediately prior to any such
Anniversary Date. Said fees will include the services to be performed by
Servicing Agent
as described in this Agreement, plus any applicable state sales or similar
taxes. Fees for other services such as special programming, computer downloads, special
reporting, special mail handling, including overnight courier or Express Mail deliveries,
and bank charges, including ACH or EFT charges, shall be separate. The term “active
accounts,” as used in this Agreement, is defined as any of the Borrower’s
accounts which are on Servicing Agent’s system and which are not canceled or paid-in-full accounts or
accounts arising from cash sales. Any canceled or paid-in-full accounts, accounts arising from cash sales
or other
inactive accounts which are maintained on Servicing Agent’s system at
Borrower’s request will be assessed a separate fee. In the event Borrower or Lender terminates all or
any part of the servicing
hereunder prior to expiration of the termination and notice periods, as set forth in Paragraph 18,
Term/Termination, Borrower shall be required to pay any monthly processing, collection, and other fees as
set forth below that would have been payable to Servicing Agent if such premature termination had not
occurred.


	
 

	
 


	
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EXHIBIT C


INSTALLMENT
RECEIVABLES 
DELINQUENCY COLLECTIONS PLAN


Below is the approximate sequence,
timing, and number of
phone calls, written notices, and letters for this Collection Plan
for a payment due April 1 and not paid when due:


	
 

	
 


	
o

	
Ten
 Phone Calls


	
 

	
 


	
o

	
Three
 Letters or Two Letters and One “Notice of Default”








	
 

	
 

	
 

	
 


	
 

	
April
 1

	
 

	
Payment
 due


	
 

	
 

	
 

	
 


	
 

	
April
 16

	
(16
 days delinquent)

	
Phone
 call and/or Letter or Reminder Notice


	
 

	
 

	
 

	
 


	
 

	
April
 24

	
 

	
Phone
 call


	
 

	
 

	
 

	
 


	
 

	
May 1

	
(30
 days delinquent)

	
Phone
 call


	
 

	
 

	
 

	
 


	
 

	
May
 8

	
 

	
Phone
 call


	
 

	
 

	
 

	
 


	
 

	
May
 15

	
(45
 days delinquent)

	
Phone
 call and/or Letter


	
 

	
 

	
 

	
 


	
 

	
May
 23

	
 

	
Phone
 call


	
 

	
 

	
 

	
 


	
 

	
June
 1

	
(60
 days delinquent)

	
Phone
 call


	
 

	
 

	
 

	
 


	
 

	
June
 8

	
 

	
Phone
 call


	
 

	
 

	
 

	
 


	
 

	
June
 15

	
(75
 days delinquent)

	
Phone
 call and/or Letter or Notice of Default


	
 

	
 

	
 

	
 


	
 

	
June
 23

	
 

	
Phone
 call


	
 

	
 

	
 

	
 


	
 

	
July
 1

	
(90
 days delinquent)

	
Servicing
 Agent’s collection efforts discontinued







	
 

	
 


	
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EXHIBIT D


CREDIT
REPORTING


On behalf of Borrower, commencing with
the month
following receipt by Servicing Agent of payments on accounts or as otherwise
instructed by Borrower to Servicing Agent in writing, Servicing Agent will report to Equifax
Credit Information Services, Inc., Experian Credit Data Southwest, Inc., and
Trans Union Credit Information Company the credit status of those individuals
whose accounts are being serviced by Servicing Agent for Borrower and whose
contract receivable payments have become sixty (60) or more days past due and, where
applicable, whose maintenance fee payments are six (6) months or more past due. Thereafter, Servicing
Agent will continue to report the appropriate delinquency information on a
monthly basis from its records as long as the Agreement and this Exhibit remain in force.


Nothing herein shall be construed to
require Servicing
Agent to report to any credit reporting agency using Servicing Agent’s
own subscriber ID number. Upon request of Servicing Agent, Borrower will supply Servicing Agent
with the subscriber ID number to be used to report payments on accounts being serviced under
the Agreement.


	
 

	
 


	
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