KAPALUA BAY HOTEL & VILLAS


     PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS


                           BETWEEN


                      YCP KAPALUA L.P.,

               a Delaware limited partnership,

                             and

                 YCP KAPALUA OPERATOR, INC.,

                   a Delaware corporation,

                   collectively, AS SELLER




                             AND




            MAUI LAND & PINEAPPLE COMPANY, INC.,

                    a Hawaii corporation,

                        AS PURCHASER



                    As of April 30, 2004











     PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS

     THIS   PURCHASE   AND   SALE   AGREEMENT   AND   ESCROW
INSTRUCTIONS (this "Agreement") is made as of April 30, 2004
(the  "Effective  Date"), by and among YCP KAPALUA  L.P.,  a
Delaware  limited  partnership  ("Land  Company"),  and  YCP
KAPALUA  OPERATOR, INC., a Delaware corporation  ("Operating
Company") (Land Company and Operating Company being referred
to  herein  collectively  as  "Seller"),  and  MAUI  LAND  &
PINEAPPLE COMPANY, INC., a Hawaii corporation ("Purchaser").

                    W I T N E S S E T H:

     A.    Seller  is  the  owner of the  Property  (defined
below).

     B.    Seller desires to sell the Property and Purchaser
desires   to  purchase  the  Property,  on  the  terms   and
conditions set forth in this Agreement.

     NOW,  THEREFORE,  for good and valuable  consideration,
the receipt and sufficiency of which is hereby acknowledged,
Purchaser and Seller agree as follows:

                          ARTICLE I
                      PURCHASE AND SALE

1.1   Agreement of Purchase and Sale.  Subject to the  terms
and  conditions hereinafter set forth, Seller agrees to sell
and convey and Purchaser agrees to purchase, all of Seller's
right, title and interest in and to the following:

     (a)   the leasehold interest in the land and any  other
     interest, if any, in the land situated in the Kapalua area
     of Maui, Hawaii more particularly described on Exhibit A
     attached hereto and made a part hereof, and the leasehold
     interest in the land and any other interest, if any, in the
     land described in the Restaurant Ground Lease (as defined
     below),  together with all and singular the rights  and
     appurtenances  of Seller pertaining to  such  property,
     including any right, title and interest of Seller in and to
     adjacent streets, alleys or rights-of-way (the property
     described in clause (a) of this Section 1.1 being herein
     referred to collectively as the "Land");

     (b)  the buildings, structures, fixtures and other
     improvements on the Land, including specifically, without
     limitation, that certain 196 room hotel commonly known as
     "Kapalua Bay Hotel & Villas", which includes, without
     limitation, the Bay Club Restaurant (collectively, the
     "Hotel") (the property described in clause (b) of this
     Section 1.1 being herein referred to collectively as the
     "Improvements");

     (c)  all tangible personal property upon the Land, within
     the Improvements or used in connection with the operation of
     the Hotel, including specifically, without limitation,
     appliances, furniture, furnishings, equipment, carpeting,
     draperies and curtains, tools and supplies, decorations,
     china, glassware, linens, silver, utensils, all vehicles (if
     any), and other items of personal property (excluding cash
     and deposit accounts used exclusively in connection with the
     operation of the Land and the Improvements, and subject to
     (i) depletion, resupply, substitution, replacement and
     disposition in the ordinary course of business and (ii) the
     provisions of Section 1.1(g) below and the provisions of
     Section 4.4(b) with respect to unopened inventories (the
     property described in clause (c) of this Section 1.1 (and
     not excluded) being herein referred to collectively as the
     "Personal Property");

     (d)  subject to Section 4.4(b) below, all contracts or
     reservations for the use of guest rooms, ballroom and
     banquet facilities or meeting rooms or other facilities of
     the Hotel or located within the Improvements ("Bookings");

     (e)  all contracts and agreements (collectively, the
     "Operating Agreements") relating to the ownership, use,
     occupancy, service, supply, entitlement, construction,
     development, management, upkeep, repair, maintenance or
     operation of the Land, the Improvements or the Personal
     Property or other property used in connection with the
     operation of the Hotel, including specifically, without
     limitation, (i) all rights of Seller under all equipment
     leases, (ii) any rights and obligations of Seller under that
     certain Kapalua Villas Management Agreement dated September
     5, 1996 (the "Villas Management Agreement") executed by and
     between Operating Company and Kapalua Land Company, Ltd., a
     Hawaii corporation ("KLC"), and any rental agreements or
     other management agreements for the residential condominium
     "villas" located adjacent to the Hotel (collectively,
     "Rental Agreements"), and (iii) rights to that certain
     Supplemental Agreement dated on or about 1985 executed by
     and among Purchaser, KLC and The KBH Company, a California
     limited partnership ("KBH"), as amended by that certain
     Amendment of Supplemental Agreement dated September 5, 1996
     executed by Purchaser and Operating Company (as amended, the
     "Supplemental Agreement"), and (iv) that certain Reciprocal
     Use Agreement dated October 22, 1985, executed by and among
     Purchaser and KBH, as amended by that certain Amendment to
     Reciprocal Use Agreement dated September 5, 1996 executed by
     Purchaser and Operating Company (as amended, the "Reciprocal
     Use Agreement");

     (f)  (i) all existing warranties and guaranties (expressed
     or implied) issued to Seller in connection with the Land,
     the Hotel, the Improvements or the Personal Property;
     (ii) all transferable names, marks, logos and designs, used
     in the operation or ownership of the Land, the Hotel, the
     Improvements or the Personal Property or any part thereof,
     if any; (iii) all transferable licenses, franchises and
     permits, documents and materials, business records, plans,
     specifications, authorizations, approvals, entitlements,
     related to the Property, including but not limited to those
     owned by Seller and used in or relating to the ownership,
     occupancy or operation of the Land, the Hotel, the
     Improvements or the Personal Property or any part thereof,
     including, without limitation, to the extent assignable (and
     subject to any approval rights of the Maui Planning
     Commission), that certain Special Management Area Use Permit
     issued by the County of Maui Department of Planning and
     dated as of October 9, 2002, and (iv) to the extent
     assignable or transferable, all other intangible personal
     property used solely in connection with the Property, but
     specifically excluding those which are proprietary to
     Manager (as defined below) except to the extent the
     Management Agreement (as defined below) permits the same to
     be used by or for the Property following the termination of
     the Management Agreement without payment of any additional
     compensation other than standard payments due under the
     Management Agreement or to the extent Purchaser acquires any
     such right directly from Manager, at no cost or liability to
     Seller (the property described in this clause (f) of this
     Section 1.1 being herein referred to collectively as the
     "Intangibles");

     (g)  subject to Section 4.4(b) below, (i) all food and
     beverages (subject to any legal restrictions pertaining to
     the sale or transfer of alcoholic beverages);
     (ii) engineering, maintenance and housekeeping supplies,
     including soap and cleaning materials, fuel and materials;
     stationery and printing items and supplies; and (iii) other
     supplies of all kinds, whether used, unused or held in
     reserve storage for future use in connection with the
     maintenance and operation of the Land, the Improvements or
     the Personal Property, together with any additions thereto
     prior to Closing (defined below) and subject to depletion,
     resupply, substitution, replacement and disposition in the
     ordinary course of business (all of the foregoing being
     referred to herein as the "Consumable Inventory" and, to the
     extent contained in unopened boxes, bottles, jars or
     containers as of the date of Closing, shall be collectively
     referred to, together with unopened packages of china,
     glass, silver and linens, as the "Unopened Inventory");

     (h)  all leases for the lease and occupancy of space at the
     Hotel (collectively, the "Leases") listed and described on
     Schedule 1.1(h) attached hereto and made a part hereof,
     including any deposits relating to such Leases held by
     Seller and not applied to the tenant's obligations as of the
     date of Closing.  For purposes of this Agreement, "Leases"
     do not include Bookings;

     (i)  all accounts receivable of the Hotel and all related
     operations (collectively, the "Receivables") (provided that
     such receivables are to be purchased by Purchaser at Closing
     for an amount equal to (A) 100% of the amount set forth as
     the "guest ledger" on the Hotel's most current balance sheet
     and (B) 98% of the amount set forth as the "city ledger" on
     the Hotel's most current balance sheet, and are not included
     in the Purchase Price); and

     (j)  subject to Section 4.4(b)(xvi) hereof, Seller's
     interest in the funds contained in "house banks" for the
     Hotel as of the Cut-Off Time (defined in Section 4.4(a)
     below), whether held in the name of Seller, the Hotel or
     Manager and owned by Seller (collectively, the "House Bank
     Funds").  Purchaser expressly acknowledges and agrees that
     the Property to be transferred to Purchaser pursuant to this
     Agreement does not include any reserve or other accounts
     created or maintained by Seller or Manager in connection
     with the ownership or operation of the Hotel; provided that,
     to extent that any such reserves exist under the Management
     Agreement (defined below) or otherwise as of the Closing
     Date (defined below) and are not returned and released to
     Seller on such date, Seller's right to such unreturned
     reserves shall be assigned to Purchaser at Closing and
     Seller shall receive a credit to the Purchase Price in the
     full amount of such reserves.

1.2  Property Defined.

     (a)   The  Land  and  the  Improvements  are  sometimes
     collectively referred to herein as the "Real Property" and
     the Real Property, the Personal Property, the Bookings, the
     Operating  Agreements, the Intangibles, the  Consumable
     Inventory, the Leases, the Receivables and the House Bank
     Funds are hereinafter sometimes referred to collectively as
     the "Property"; provided that, the Purchase Price does not
     include,  and  shall be adjusted with respect  to,  the
     Receivables, the House Bank Funds, the Unopened Inventory
     and the other adjustment items described in Section 4.4
     below.

     (b)  Notwithstanding anything to the contrary in Section
     1.1, the following items are expressly excluded from the
     Property:

          (i)  All cash on hand or on deposit, any operating account
          or other account or reserve, except for security deposits
          held by Seller as landlord with respect to any Lease and the
          House Banks which are to be transferred at Closing subject
          to the terms of this Agreement;

          (ii) Any tangible or intangible property owned by Manager,
          except to the extent the Management Agreement permits same
          to be used by or for the Property following the termination
          of the Management Agreement without payment of any
          additional compensation other than standard payments due
          under the Management Agreement or to the extent Purchaser
          acquires any such right directly from Manager, at no cost or
          liability to Seller, and Purchaser elects to obtain or
          acquire same; and

          (iii)     Any fixtures, personal property or intellectual
          property owned by (A) the supplier, vendor, licensor, lessor
          or other party under any Operating Agreements, (B) the
          tenant under any Lease, (C) any employees, (D) any guests or
          customers of the Hotel, or (E) any other third party.

1.3   Permitted Exceptions.   The Property shall be conveyed
subject  to  the  matters which are, or are  deemed  to  be,
Permitted   Exceptions  pursuant  to   Article   II   hereof
(collectively, the "Permitted Exceptions").

1.4  Purchase Price.  Seller is to sell and Purchaser is to
purchase the Property for a total of FORTY-NINE MILLION
THREE HUNDRED THOUSAND AND NO/100 DOLLARS ($49,300,000.00)
(the "Purchase Price").

1.5  Payment of Purchase Price.
     (a)  On or before 10:00 a.m. Hawaii time on the date that is
     one (1) business day prior to the scheduled Closing Date
     (but in no event later than 10:00 a.m. Hawaii time on the
     date that is one (1) business day preceding the Outside
     Closing Date (defined below), Purchaser shall deliver to
     Escrow Agent (defined below) by wire transfer an amount
     equal to the Purchase Price, as increased or decreased by
     prorations and adjustments as herein provided, less the
     Earnest Money (defined below) previously delivered to Escrow
     Agent.

     (b)  The Purchase Price, as increased or decreased by
     prorations and adjustments as herein provided, shall be
     payable in full at Closing in cash by wire transfer of
     immediately available federal funds to a bank account
     designated by Seller in writing to Purchaser and Escrow
     Agent prior to the Closing.

1.6  Earnest Money.

     (a)  Concurrently with Purchaser's execution and delivery of
     this  Agreement Purchaser shall deposit the sum of Five
     Hundred Thousand and No/100 Dollars ($500,000.00) ("First
     Deposit")  in good funds, either by certified  bank  or
     cashier's check or by federal wire transfer, with Title
     Guaranty Escrow Services ("Escrow Agent") having its office
     at  235  South  Queen Street, Honolulu, Hawaii   96813,
     Attention: Barbara Paulo.  On or before the expiration of
     the Inspection Period (as defined below), provided that
     Purchaser has not terminated the Agreement, Purchaser shall
     deposit with Escrow Agent the additional sum of One Million
     Five Hundred Thousand and No/100 Dollars ($1,500,000.00)
     ("Second Deposit") in good funds, either by certified bank
     or cashier's check or by federal wire transfer.  The First
     Deposit and the Second Deposit, together with all interest
     earned on such sums, are herein referred to collectively as
     the "Earnest Money".

     (b)  Escrow Agent shall hold the First Deposit and the
     Second Deposit in an interest-bearing account in a
     commercial bank or banks reasonably acceptable to Seller and
     Purchaser at money market rates, or in such other
     investments as shall be reasonably approved in writing by
     Seller and Purchaser, in accordance with the terms and
     conditions of this Agreement.  All interest accruing on such
     sums shall become a part of the Earnest Money and shall be
     distributed as Earnest Money in accordance with the terms of
     this Agreement.  Notwithstanding any provision of this
     Agreement to the contrary, in no event shall Seller have any
     responsibility or liability to Purchaser in connection with
     the accrual or payment of interest on any portion of the
     Earnest Money.  The Earnest Money shall be either, all as
     expressly provided in this Agreement: (a) applied at the
     Closing against the Purchase Price, (b) returned to
     Purchaser pursuant hereto, or (c) paid to Seller pursuant
     hereto.  For purposes of reporting earned interest with
     respect to the Earnest Money, Purchaser's Federal Tax
     Identification Number is 99-0107542, and Seller's Federal
     Tax Identification Number is 58-2255646.

     (c)  Time is of the essence for the delivery of Earnest
     Money under this Agreement and the failure of Purchaser to
     timely deliver any portion of the Earnest Money shall be a
     material default, and shall entitle Seller, at Seller's sole
     option, to terminate this Agreement immediately and to
     pursue all remedies available to Seller under this Agreement
     and applicable law.

1.7   Escrow  Instructions.  The terms  and  conditions  set
forth  in  this Agreement shall constitute both an agreement
between  Seller  and Purchaser and escrow  instructions  for
Escrow  Agent.  Seller and Purchaser shall promptly  execute
and  deliver  to  Escrow  Agent any separate  or  additional
escrow  instructions  requested by Escrow  Agent  which  are
consistent  with the terms of this Agreement.  Any  separate
or  additional instructions shall not modify or  amend  this
Agreement  unless expressly set forth by the mutual  consent
of Seller and Purchaser.

1.8  Management Agreement.
     (a)  Purchaser acknowledges that the Hotel is being operated
     and managed by Sheraton Hawaii Hotels Corporation, a Hawaii
     corporation  (the "Manager"), pursuant to that  certain
     Management Agreement dated as of January, 2000  by  and
     between Operating Company and Manager, as amended by that
     certain First Amendment to Management Agreement dated
     April 15,2002 executed by and between Operating Company and
     Manager  (collectively,  as  amended,  the  "Management
     Agreement").  Subject to the provisions of this Section 1.8,
     the  Management Agreement shall be terminated by Seller
     concurrently with the Closing.

     (b)  Notwithstanding the foregoing, Purchaser shall have the
     right, to be commenced, if at all, promptly after execution
     of this Agreement and pursued diligently by Purchaser, to
     (i) request Manager's consent to an assignment of the
     Management Agreement to Purchaser at Closing pursuant to
     Section 9.2 of the Management Agreement and to Purchaser's
     assumption of the Management Agreement at Closing, and/or
     (ii) negotiate with Manager to obtain a short-term or long-
     term extension to the Management Agreement (or replacement
     to the Management Agreement) effective as of the Closing
     Date.  Seller shall use commercially reasonable efforts to
     cooperate with Purchaser's attempts to negotiate and
     implement such a consent or agreement, provided that such
     cooperation shall be at no cost or expense to Seller and
     provided further that Seller shall incur no additional
     liability as a result thereof.

     (c)  Notwithstanding the provisions of paragraph (a) above,
     Seller shall not terminate the Management Agreement if
     Purchaser (i) determines in its sole discretion that it has
     reached a satisfactory agreement with Manager regarding
     Manager's continued operation of the Hotel following the
     Closing Date, and (ii) provides Seller with written notice
     of instruction not to terminate the Management Agreement on
     or before the date two (2) business days prior to the
     thirtieth (30th) day preceding the Outside Closing Date,
     which notice shall include the unconditional written consent
     of Manager to the assignment of the Management Agreement to
     Purchaser.

     (d)  In no event shall Purchaser's negotiations with Manager
     regarding an amendment to the Management Agreement or any
     replacement hotel management agreement (i) constitute a
     condition to Closing or otherwise affect Purchaser's
     obligation to close the purchase of the Hotel, or (ii)
     extend the Outside Closing Date.

     (e)  Time is of the essence with respect to the provisions
     of this Section 1.8.

1.9  Collective Bargaining Agreement.

     (a)  Effective as of the date of the Closing, Purchaser
     shall  have  elected (which election  shall  have  been
     communicated  to  Seller in writing on  or  before  the
     expiration of the Inspection Period) either to:

          (i)  pursuant to the Assignment of Contracts, assume and
          agree to perform all obligations of the "Hotel" and
          "Employer" under that certain Union-Management Operating
          Agreement effective as of July 2, 2001, by and between
          Operating Company and International Longshore and Warehouse
          Union, Local 142 (the "Union") (the "Labor Agreement")
          becoming due after the Closing Date; or

          (ii) not assume the Labor Agreement and any obligations
          thereunder and instead establish its own initial terms and
          conditions of employment (provided that Purchaser shall be
          required to comply with the rules and doctrines for
          successor employers under applicable law to the extent
          applicable in connection therewith); or

          (iii)     agree with the Union to a modified collective
          bargaining agreement provided that the modified collective
          bargaining agreement does not enlarge upon any of Seller's
          obligations under the Labor Agreement or increase Seller's
          liability.

     (b)  If Purchaser fails to communicate its election  in
     writing to Seller prior to the expiration of the Inspection
     Period,  Purchaser shall be deemed to have  irrevocably
     selected the option under subsection (a)(i) above.

     (c)  Seller shall use commercially reasonable efforts to
     cooperate with whatever election Purchaser makes under this
     Section 1.9, at no cost or expense to Seller and provided
     that Seller shall incur no additional liability as a result
     thereof.  In no event shall Purchaser's negotiations or the
     reaching of an agreement with the Union with respect to the
     Labor Agreement (i) constitute a condition to Closing or
     otherwise affect Purchaser's obligation to close the
     purchase of the Hotel, or (ii) extend the Outside Closing
     Date.

     (d)  If Purchaser assumes the Labor Agreement, effective as
     of the Closing Date, Purchaser covenants to comply at all
     times with the obligations arising thereafter of the Hotel
     owner or "Employer" under the Labor Agreement as the
     successor-in-interest to Seller under such agreement.  If
     Purchaser elects not to assume the Labor Agreement and
     instead enters into an agreement with the Union which
     modifies the Labor Agreement, Purchaser shall notify Seller
     and Seller agrees to reasonably cooperate with Purchaser in
     implementing any changes agreed to with the Union provided
     that such changes do not impose any new or additional costs
     or liability on Seller.

     (e)  Seller shall deliver to Purchaser at Closing the
     following information from the personnel records for any
     Hotel employee offered employment by Purchaser at Closing
     (to the extent each such item is available in Seller's
     personnel records), subject to (i) any applicable legal
     requirement (including, without limitation, any privacy or
     consent rights of employees and any restrictions imposed by
     the Health Insurance Portability and Accountability Act of
     1996), and (ii) any rights of Manager under the Management
     Agreement: (A) the employee's hire date and seniority date,
     (B) the job positions held by the employee, the job
     description for each job, the dates of each job change and
     the wage rates paid for each job, (C) the type and dates of
     all paid and unpaid leaves requested and granted to the
     employee (provided that in no event shall any medical
     information or indication of medical conditions be required
     to be supplied to Purchaser), (D) all commendations and all
     disciplinary actions issued to the employee including
     counseling, warnings (including oral warnings noted in the
     personnel files), suspensions, demotions, transfers and
     terminations, (E) all agreements regarding the employee's
     employment with the employee or with the Union including any
     last chance agreements, (F) all performance reviews, (G) all
     grievances and arbitration awards regarding the employee or
     the interpretation and application of the Labor Agreement
     generally, (H) all claims, charges or complaints filed by or
     against the employee relating to the employee's employment
     at the Hotel (provided that any such claims, charges or
     complaints against any employee resulted in warnings or
     disciplinary action), and (I) all current garnishment and
     child support orders, tax liens or other court or government
     agencies orders relating to the employee that requires any
     continuing action by the Hotel.

     (f)  The provisions of this Section 1.9 shall survive
     Closing.

1.10 Multiemployer Plan.

     (a)    Purchaser  acknowledges  and  agrees  that   (i)
     Purchaser shall be responsible for all amounts, if any,
     as  may  be  owed  by  or assessed against  Seller  (as
     withdrawal  liability or otherwise) in connection  with
     any actual or deemed withdrawal from the Hotel Industry
     -  ILWU  Pension  Plan  (the "Multiemployer  Plan")  in
     connection with the Closing and the sale of  the  Hotel
     by  Seller  or Purchaser's failure to assume the  Labor
     Agreement  in  connection  therewith,  and   (ii)   the
     Purchase Price agreed upon between Purchaser and Seller
     has already been reduced to reflect an estimate (as  of
     the   Effective   Date)  of  any  potential   liability
     Purchaser may have under this Section 1.10 for  amounts
     which  might become due and payable in connection  with
     the  Multiemployer Plan.  Such amounts  shall  be  paid
     without  regard to any right Seller may have to contest
     any such withdrawal liability assessment.  If Purchaser
     so  requests  in  writing,  Seller  will  provide  such
     cooperation (at no expense to Seller) as Purchaser  may
     reasonably request to contest such withdrawal liability
     assessment  after  payment thereof.  Any  such  contest
     shall  be at Purchaser's sole expense.  Purchaser shall
     indemnify, defend, protect and hold harmless Seller for
     any  payments Seller is required to make on account  of
     any withdrawal under the Multiemployer Plan.  Purchaser
     agrees  to provide Seller with a copy of any notice  of
     withdrawal liability it may receive with respect to the
     Multiemployer  Plan, together with  all  the  pertinent
     details with respect thereto.

     (b)   Purchaser  shall have the right to  mitigate  the
     requirement  to  make  payments under  Section  1.10(a)
     above  which may be owed by or assessed against  Seller
     as  withdrawal liability by eliminating any  actual  or
     deemed  withdrawal  from  the  Multiemployer  Plan,  if
     Purchaser  (i) assumes the Labor Agreement as  provided
     above,  or (ii) enters into a new labor agreement  with
     the   Union  that  contemplates  contributions  to  the
     Multiemployer  Plan  (as defined below)  by  Purchaser,
     effective  as  of  the date of the Closing,  and  takes
     steps  required  by  Section  4204  of  ERISA  and  the
     regulations and interpretations promulgated  thereunder
     (collectively,  "Section 4204 of ERISA"),  which  shall
     include contributing with respect to substantially  the
     same number of contribution base units for which Seller
     had   an  obligation  to  contribute  under  the  Labor
     Agreement immediately prior to the date of the Closing,
     and  by  complying with the following  subsections  (A)
     through (D):

          (A)  During the period commencing on the first day
          of  the plan year following the Closing and ending
          on  the  expiration of the fifth (5th)  such  plan
          year  (the "Contribution Period"), Purchaser shall
          provide the Multiemployer Plan with either a  bond
          or  an escrow in an amount and manner meeting  the
          requirements of Section 4204 of ERISA.   Purchaser
          shall  promptly notify the Multiemployer  Plan  of
          the  transactions contemplated by this  Agreement,
          and,  if  applicable, satisfy each such plan  that
          this  transaction  complies  with  the  terms   of
          Section  4204  of ERISA.  Any proposed  notice  or
          communication  to the Multiemployer Plan  pursuant
          to  this  Section 1.10(b)(A) shall be provided  to
          Seller  at least ten (10) days before such  notice
          is  provided  to the plan, and the  form  of  such
          notice  and  communication  shall  be  subject  to
          Seller's  written approval, which  approval  shall
          not be unreasonably withheld.  Any notice from the
          Multiemployer Plan, including, but not limited to,
          any  notice  of  withdrawal  liability,  shall  be
          provided to Seller within three (3) business  days
          of the time it is provided to Purchaser.

          (B)    If   Purchaser  at  any  time  during   the
          Contribution    Period    withdraws    from    the
          Multiemployer  Plan  in  a  complete  or   partial
          withdrawal  with respect to any employees  covered
          by  the  Labor  Agreement or any other  collective
          bargaining  agreement, Purchaser shall  cause  any
          resulting withdrawal liability to be timely  paid,
          and  if  Purchaser  fails to pay  such  withdrawal
          liability  in a timely manner to the Multiemployer
          Plan,  Seller agrees it will be secondarily liable
          for any withdrawal liability it would have had  to
          the   Multiemployer  Plan  with  respect  to   the
          operations  (but  for  Section  4204  of   ERISA).
          Purchaser  shall  indemnify, defend,  protect  and
          hold  harmless Seller for any withdrawal liability
          payments Seller is required to make on account  of
          this  subsection (B).  Purchaser agrees to provide
          Seller  with  a  copy of any notice of  withdrawal
          liability  it  may  receive with  respect  to  the
          Multiemployer   Plan,  together   with   all   the
          pertinent details with respect thereto.

          (C)   Purchaser shall notify Seller in  the  event
          that  Purchaser  withdraws from the  Multiemployer
          Plan  in  a complete or partial withdrawal  during
          the   Contribution  Period,  and  upon  reasonable
          request  of Seller, shall provide Seller with  any
          and all information relevant to the obligations of
          Purchaser and Seller under this Section 1.10  that
          is  reasonably available to Purchaser.   Purchaser
          shall  provide Seller with copies of all  notices,
          demands,   and   other   correspondence    between
          Purchaser  (or  any  party  acting  on  behalf  of
          Purchaser  or  in  connection with  a  partial  or
          complete   withdrawal  by   Purchaser)   and   the
          Multiemployer Plan relating to such withdrawal.

          (D)   If  at any time after the Closing,  a  bond,
          escrow  or  letter of credit is required  for  the
          Multiemployer Plan pursuant to Section  4204(a)(3)
          of  ERISA, Purchaser shall, at its sole  cost  and
          expense,  post  such  bond, escrow  or  letter  of
          credit  in an amount, for the period of time,  and
          in  a  form  that complies with Section 4204(a)(3)
          (or obtain a variance from such bonding, escrow or
          letter of credit requirement from the Plan or  the
          Pension  Benefit Guaranty Corporation) and furnish
          proof of such compliance to Seller.

     (c)   The provisions of this Section 1.10 shall survive
     Closing.

1.11  Assumed Liabilities. At Closing, to the extent  either
(a)  arising after the Closing or (b) Purchaser  receives  a
credit   to  the  Purchase  Price  with  respect   to   such
Liabilities  (as defined below) at Closing, Purchaser  shall
assume  all  liability, obligation, damage,  loss,  cost  or
expense  of  any  kind  or nature whatsoever  (collectively,
"Liabilities"), arising from, relating to, or in  connection
with  the  Property  or  the  Hotel.   Notwithstanding   the
foregoing, Purchaser shall not assume or be responsible  for
any Liability to the extent such Liability is a breach of  a
Seller   covenant  which  survives  Closing  or  any  Seller
representation under Section 5.1 below.  The parties' rights
and  obligations under this Section 1.11 shall  survive  the
Closing.

1.12 Non Liability.
     (a)  Seller agrees that neither the partners, directors,
     shareholders, affiliates, officers, employees, members,
     managers  nor  agents of Purchaser  have  any  personal
     obligation hereunder, and that Seller shall not seek to
     assert any claim or enforce any rights hereunder against
     such partners, directors, officers, employees, members,
     managers or agents of Purchaser.

     (b)  Purchaser agrees that neither the partners, directors,
     shareholders, affiliates, officers, employees, members,
     managers nor agents of Seller have any personal obligation
     hereunder, and that Purchaser shall not seek to assert any
     claim or enforce any rights hereunder against such partners,
     directors, officers, employees, members, managers or agents
     of Seller.

    (c)  This Section 1.12 shall survive Closing.

1.13 Indemnification.

     (a)  Seller hereby agrees to defend, indemnify and hold
     Purchaser  and  all directors, officers,  shareholders,
     affiliates, members, managers, partners, employees  and
     agents of Purchaser (each, a "Purchaser Indemnified Party")
     harmless from and against all losses, damages, costs and
     expenses, including, without limitation, reasonable legal
     fees and disbursements, incurred by a Purchaser Indemnified
     Party arising out of (i) claims made by employees of the
     Hotel, but only if such claims arise from acts or omissions
     of  parties  other  than a Purchaser Indemnified  Party
     occurring solely during Seller's ownership of the Hotel,
     (ii) obligations of Seller under any contracts executed in
     connection  with  the  Hotel to the  extent  that  such
     obligations arise prior to the Closing Date, and  (iii)
     personal injury claims, but only if such claims arise from
     acts or omissions occurring solely during Seller's ownership
     of the Hotel.  In no event shall such obligation to defend,
     indemnify or hold harmless include any matters for which
     Purchaser has assumed liability, received a credit against
     the Purchase Price, or waived or relinquished rights or
     released  Seller pursuant to this Agreement, including,
     without limitation, pursuant to Section 9.1 or Section 9.2
     below.

     (b)  Purchaser hereby agrees to defend, indemnify and hold
     Seller and all directors, officers, shareholders,
     affiliates, members, managers, partners, employees and
     agents of Seller (each, a "Seller Indemnified Party")
     harmless from and against all losses, damages, costs and
     expenses, including, without limitation, reasonable legal
     fees and disbursements, incurred by a Seller Indemnified
     Party arising out of (i) claims made by employees of the
     Hotel, but only if such claims arise from acts or omissions
     occurring solely on or after the Closing Date, (ii)
     obligations of Purchaser under any contracts assumed by
     Purchaser under this Agreement or other contracts executed
     in connection with the Hotel to the extent that such
     obligations arise on or after the Closing Date, and (iii)
     personal injury claims, but only if such claims arise from
     acts or omissions of parties other than a Purchaser
     Indemnified Party occurring solely on or after the Closing
     Date.

     (c)  This Section 1.13 shall survive Closing.


                         ARTICLE II
                      TITLE AND SURVEY

2.1   Title  Examination; Commitment  for  Title  Insurance.
Seller   has   obtained  and  delivered  to   Purchaser,   a
preliminary  title report (the "Title Report") covering  the
Land  and the Improvements from Island Title Corporation  as
agent  for  Commonwealth Land Title Insurance  Company  (the
"Title Company"), and a copy of each document referenced  in
the  Title  Report  as an exception to  title  to  the  Real
Property.    Purchaser  shall  deliver  to  Seller,   within
five  (5)  days after receipt by Purchaser, a  copy  of  any
updates  (each  a  "Title  Update")  to  the  Title  Report,
together  with  a  written statement  by  Purchaser  of  all
objections to title disclosed by any such Title Update.

2.2  Survey.  Seller has previously provided to Purchaser an
ALTA survey of the Land and Improvements prepared by
Newcomer-Lee Land Surveyors, Inc. dated June 18, 2001
("Existing Survey").  Seller shall obtain and deliver to
Purchaser and the Title Company, at Purchaser's expense, an
update of the Existing Survey (collectively with the
Existing Survey, the "Survey").

2.3  Title Objections; Cure of Title Objections.  Purchaser
shall have until the date (the "Title Exam Deadline"), which
is ten (10) days prior to the expiration of the Inspection
Period (as defined in Section 3.1 below) (and, with respect
to any Title Update, five (5) days after receipt of such
Title Update) to notify Seller, in writing, of such
objections as Purchaser may have to anything contained in
the Title Report or the Survey.  Any item contained in the
Title Report, Title Update or any matter shown on the Survey
to which Purchaser does not object prior to the Title Exam
Deadline (or, with respect to any Title Update prior to the
end of the applicable 5-day period) shall be deemed a
Permitted Exception.  In the event Purchaser shall notify
Seller, in writing, of objections to title or to matters
shown on the Survey prior to the Title Exam Deadline, Seller
shall have the right, but not the obligation, to cure such
objections.  Within ten (10) days after receipt of
Purchaser's notice of objections, Seller shall notify
Purchaser in writing whether Seller elects to attempt to
cure any or all of such objections.  If Seller elects to
attempt to cure, and provided that Purchaser shall not have
terminated this Agreement in accordance with Section 3.3
hereof, Seller shall have until the Outside Closing Date to
attempt to remove, satisfy or cure the same and for this
purpose Seller shall, at Seller's election, be entitled to a
reasonable adjournment of the Closing if additional time is
required, but in no event shall the adjournment exceed
sixty (60) days after the Outside Closing Date.  If Seller
elects not to cure any objections specified in Purchaser's
notice, or if Seller is unable to effect a cure of those
objections which it elected to cure prior to the Closing (or
any date to which the Closing has been adjourned) and so
notifies Purchaser in writing, or if Seller fails to respond
to Purchaser's notice within said ten (10) day period,
Purchaser shall have the following options: (i) to accept a
conveyance of the Property subject to the Permitted
Exceptions, specifically including any matter objected to by
Purchaser which Seller is unwilling or unable to cure, and
without reduction of the Purchase Price; or (ii) to
terminate this Agreement by sending written notice thereof
to Seller, and upon delivery of such notice of termination,
this Agreement shall terminate and the Earnest Money shall
be returned to Purchaser, and thereafter neither party
hereto shall have any further rights, obligations or
liabilities hereunder except to the extent that any right,
obligation or liability set forth herein expressly survives
termination of this Agreement.  If Seller notifies Purchaser
that Seller does not intend to attempt to cure any title
objection or fails to respond to Purchaser's notice within
said ten (10) day period; or if, having commenced attempts
to cure any objection, Seller later notifies Purchaser in
writing that Seller will be unable to effect a cure thereof;
Purchaser shall, within five (5) days after such notice has
been given, notify Seller in writing whether Purchaser shall
elect to accept the conveyance under clause (i) or to
terminate this Agreement under clause (ii).  Purchaser's
failure to notify Seller of termination of this Agreement
within such 5-day period shall be deemed to be an
irrevocable election under clause (i) to accept conveyance
of the Property.  Notwithstanding any provision of this
Agreement to the contrary, in no event shall Seller have any
obligation to cure any title matter objected to by
Purchaser, except that Seller shall be obligated to remove
any mortgage or other security instrument encumbering title
to the Real Property to which Seller is a party.

2.4  Conveyance of Title.   At Closing, Seller shall convey
and transfer to Purchaser Seller's interest in and to the
Real Property subject to the Permitted Exceptions.
Notwithstanding anything contained herein to the contrary,
the Real Property shall be conveyed subject to the following
matters, all of which shall be deemed to be Permitted
Exceptions:

     (a)   the lien of all ad valorem real estate taxes  and
     assessments not yet due and payable as of the  date  of
     Closing, subject to adjustment as herein provided;

     (b)  local, state and federal laws, ordinances or
     governmental regulations, including but not limited to,
     building and zoning laws, ordinances and regulations, now or
     hereafter in effect relating to the Property;

     (c)  items appearing of record or shown on the Survey and,
     in either case, not objected to by Purchaser or waived or
     deemed waived by Purchaser in accordance with Section 2.3
     hereof;

     (d)  the rights of Hotel guests which occupy the Hotel or
     have a reservation for rooms, food and beverages, meetings
     and other customary Hotel uses relating to periods
     subsequent to the Closing Date;

     (e)  the rights of KLC under the Villas Management Agreement
     and the rights of any other parties to the Rental
     Agreements;

     (f)  to the extent that the Management Agreement is not
     terminated as of Closing pursuant to Section 1.8 above, the
     rights of Manager under the Management Agreement; and

     (g)  the rights of the tenants under the Leases.

2.5  Title Policy.  At Closing, Purchaser and Seller request
that  Title  Company issue an ALTA owner's  title  insurance
policy ("Title Policy") to Purchaser in accordance with  the
Title  Report, insuring Purchaser's leasehold title  to  the
Real  Property  as  of  the Closing  Date,  subject  to  the
Permitted Exceptions.

2.6  Termination of Operating Agreements.  Following
expiration of the Inspection Period, Seller will cancel, all
service contracts for the Property designated for
termination by Purchaser in a written notice given to Seller
prior to the end of the Inspection Period; provided,
however, that (a) Seller shall not incur any cost, expense
or liability arising from such termination, (b) termination
shall be effective upon the later of the Closing Date or any
later date required under the applicable contract, and (c)
any contracts which are not terminable or are not designated
by Purchaser for termination as set forth herein will be
assigned to Purchaser and all obligations of Seller
thereunder arising from and after the Closing Date shall be
assumed by Purchaser at Closing.


                         ARTICLE III
                      INSPECTION PERIOD

3.1   Right of Inspection.  During the period beginning upon
the  Effective Date and ending at 5:00 p.m. (local  time  at
the  Property) sixty (60) days after the execution  of  this
Agreement   (hereinafter  referred  to  as  the  "Inspection
Period"),  Purchaser shall, subject to  the  rights  of  the
Manager under the Management Agreement, guests of the  Hotel
and  the tenants under the Leases, have the right to make  a
physical  inspection of the Real Property and to examine  at
such  place or places at the Hotel or elsewhere as the  same
may be located, any operating files maintained by or for the
benefit  of  Seller  (or otherwise in Seller's  control)  in
connection  with  the operation, current maintenance  and/or
management   of   the  Property  ("Property   Information"),
including,  without limitation, the Ground  Leases  (defined
below),   the  Villas  Management  Agreement,   the   Rental
Agreements,  the  Management  Agreement,  any  Leases,   the
Operating  Agreements,  the Labor Agreement  and  any  other
collective  bargaining  or employment agreements,  insurance
policies,  bills,  invoices,  receipts  and  other   general
records  relating to the income and expenses of  the  Hotel,
correspondence,    surveys,   plans   and    specifications,
warranties for services and materials provided to the Hotel,
environmental  audits and similar materials, and  any  other
items  reasonably  requested  by  Purchaser,  but  excluding
materials  not  directly related to the current  maintenance
and/or  management of the Hotel such as, without limitation,
Seller's internal memoranda, financial projections, budgets,
appraisals,   accounting  and  tax   records   and   similar
proprietary,    elective   or   confidential    information.
Purchaser  shall  keep  all  Property  Information  strictly
confidential, provided that Purchaser may deliver copies  of
Property Information to its attorneys, accountants and other
advisors  in connection with the acquisition of the Property
and to current and prospective lenders and partners provided
that  such parties agree to maintain the confidentiality  of
such Property Information.  Purchaser understands and agrees
that  any  on-site  inspections of  the  Property  shall  be
conducted  upon  at  least  twenty-four  (24)  hours'  prior
written notice to Seller and, at the election of Seller,  in
the  presence  of  such  persons  designated  by  Seller  as
Seller's  representative and Manager,  or  their  respective
representatives.  Such physical inspection shall not disturb
Hotel guests nor unreasonably interfere with the use of  the
Property by Seller or Manager, or damage the Property in any
respect.   Any  physical inspection shall  be  conducted  in
accordance  with  standards  customarily  employed  in   the
industry and in compliance with all governmental laws, rules
and  regulations and shall not be invasive  in  any  respect
unless  Purchaser  obtains Seller's prior  written  consent,
which   may  be  withheld  in  Seller's  sole  and  absolute
discretion;  provided  that, Seller has  generally  approved
inspections  of  the  Property  of  the  type  described  on
Schedule 3.1 attached hereto subject to Seller's review  and
approval  of  specific work plans for any such  inspections,
which  approval  shall  not  unreasonably  be  withheld   or
delayed.  Following each entry by Purchaser with respect  to
inspections  and/or  tests on the Real  Property,  Purchaser
shall  restore the Property to a condition which is as  near
to  its  original  condition as existed prior  to  any  such
inspections  and/or  tests.   Seller  shall  cooperate  with
Purchaser in its due diligence but shall not be obligated to
incur  any  liability  or expense in  connection  therewith.
Purchaser  shall not contact Manager, any of its  employees,
or  any other employees working at the Hotel, any guests  of
the  Property, any party to an Operating Agreement,  or  any
tenants  under the Leases without in each instance notifying
Jill  Johnson  of Morgan Stanley in advance (in  writing  or
verbally, but any verbal notice must be delivered personally
directly  to  Ms. Johnson rather than left on  voicemail  or
with another person unless Purchaser is unable to reach  Ms.
Johnson using reasonable due diligence for a period of three
(3)  consecutive  business days) and  Seller  shall  (a)  be
copied   on   all  communications  with  any  such   parties
concurrently  with delivery of the applicable communication,
and  (b)  have the right to participate in any face-to-face,
telephonic   or   other  meeting  with  any  such   parties.
Purchaser  shall  not disrupt Seller's or Manager's  or  any
tenant's   or  guest's  activities  on  the  Real  Property.
Purchaser  agrees to indemnify against, defend, protect  and
hold  Seller harmless from any claim for liabilities, costs,
expenses  (including  reasonable  attorneys'  fees  actually
incurred)  damages or injuries arising out of  or  resulting
from  the  inspection of the Property by  Purchaser  or  its
agents,   employees   or  contractors  and   notwithstanding
anything  to the contrary in this Agreement, such obligation
to indemnify, defend, protect and hold harmless Seller shall
survive  Closing or any termination of this Agreement.   All
inspections shall occur at reasonable times agreed  upon  by
Seller  and  Purchaser; provided that, if  Seller  fails  to
object  or  approve  a proposed time for  inspection  within
three  (3) business days after a request for such inspection
time  (such  request to be made in writing or verbally,  but
any  verbal notice must be delivered personally directly  to
Ms.  Johnson  rather than left on voicemail or with  another
person unless Purchaser is unable to reach Ms. Johnson using
reasonable  due  diligence  for  a  period  of   three   (3)
consecutive  business  days), then  such  request  shall  be
automatically  deemed approved.  Purchaser agrees  (i)  that
prior  to  entering the Property to conduct any  inspection,
Purchaser shall obtain and maintain, or shall cause each  of
its  contractors and agents to maintain (and  shall  deliver
evidence  satisfactory to Seller thereof),  at  no  cost  or
expense  to  Seller,  general liability  insurance  from  an
insurer  reasonably acceptable to Seller in  the  amount  of
Three  Million  Dollars ($3,000,000) (except  for  Group  70
International,  who shall be required only to  have  general
liability  insurance  of Two Million  Dollars  ($2,000,000))
with  combined single limit for personal injury or  property
damage  per occurrence, such policies to name Seller  as  an
additional  insured  party, which  insurance  shall  provide
coverage  against any claim for personal injury or  property
damage caused by Purchaser or its agents, representatives or
consultants   in   connection  with  any  such   tests   and
investigations, and (ii) to keep the Property free from  all
liens   and  encumbrances.   Provided  Purchaser  does   not
exercise its termination right pursuant to Section 3.3,  and
this  Agreement is still in full force and effect, Purchaser
shall continue to have access to the Property following  the
expiration of the Inspection Period in accordance  with  the
provisions  of this Section 3.1, but in no event  shall  (A)
the  Inspection Period be extended or (B) Purchaser have any
further  right to terminate this Agreement after  expiration
of   the  Inspection  Period  pursuant  to  Section  3.3  or
otherwise   in  connection  with  its  continued   diligence
activities regarding the Property.

3.2  Seller Due Diligence Materials.  PURCHASER ACKNOWLEDGES
THAT (1) PURCHASER HAS RECEIVED AND IS FAMILIAR WITH ALL
ENVIRONMENTAL, ENGINEERING, SOILS AND OTHER REPORTS
REGARDING THE CONDITION OF THE PROPERTY LISTED ON SCHEDULE
3.2 ATTACHED HERETO (collectively, the "Reports"), AND
(2) ANY REPORTS DELIVERED OR TO BE DELIVERED BY SELLER OR
ITS AGENTS OR CONSULTANTS TO PURCHASER ARE BEING MADE
AVAILABLE SOLELY AS AN ACCOMMODATION TO PURCHASER AND
WITHOUT ANY REPRESENTATION OR WARRANTY OF SELLER AS TO THEIR
ACCURACY OR COMPLETENESS AND THAT ANY RELIANCE BY PURCHASER
ON SUCH REPORTS IN CONNECTION WITH THE PURCHASE OF THE
PROPERTY IS UNDERTAKEN AT PURCHASER'S SOLE RISK.  PURCHASER
HAS CONDUCTED, OR WILL CONDUCT PRIOR TO THE EXPIRATION OF
THE INSPECTION PERIOD, ITS OWN INVESTIGATION OF THE
CONDITION OF THE PROPERTY TO THE EXTENT PURCHASER DEEMS SUCH
AN INVESTIGATION TO BE NECESSARY OR APPROPRIATE.

3.3  Right of Termination.  Seller agrees that in the event
Purchaser determines (such determination to be made in
Purchaser's sole discretion) that the Property is not
suitable for its purposes, Purchaser shall have the right to
terminate this Agreement by giving written notice thereof to
Seller prior to the expiration of the Inspection Period.  If
Purchaser gives such notice of termination within the
Inspection Period, this Agreement shall terminate and the
Earnest Money shall be returned to Purchaser.  Time is of
the essence with respect to the provisions of this Section
3.3.  If Purchaser fails to give Seller a notice of
termination prior to the expiration of the Inspection
Period, Purchaser shall no longer have any right to
terminate this Agreement under this Section 3.3 and shall be
bound to proceed to Closing and consummate the transaction
contemplated hereby pursuant to the terms of this Agreement.
If Purchaser terminates this Agreement pursuant to this
Section 3.3 or if this Agreement terminates for any other
reason whatsoever, Purchaser shall promptly return all
Property Information to Seller without retaining any copies
thereof.

3.4  Coconut Grove Joint Venture.  Lend Lease (US) Inc., a
Delaware corporation (as predecessor-in-interest to YCP Site
29, Inc., a Delaware corporation, and an affiliate of Seller
("YCP"), Purchaser and Kapalua Land Company, Ltd., a Hawaii
corporation, are parties to that certain unrecorded
Agreement dated July 12, 1996 (the "Preliminary Agreement").
Further, YCP and Purchaser are parties to that certain
Operating Agreement for Kapalua Coconut Grove LLC dated June
20, 1997 (the "LLC Agreement"), which established Kapalua
Coconut Grove LLC, a Hawaii limited liability company
("KCG").  During the Inspection Period, Purchaser agrees to,
and Seller and Purchaser agree to cause their respective
affiliates to, negotiate in good faith regarding the form of
a termination agreement that (a) terminates the Preliminary
Agreement, and (b) provides for orderly dissolution of KCG
including, without limitation, (1) the winding up of the
affairs of KCG including the liquidation of and allocation
of responsibility for any contingent liabilities and claims,
(2) the termination of the LLC Agreement, and (3) the
execution and filing of Articles of Termination (as provided
by 428-805, Hawaii Revised Statutes) dissolving KCG on a
date to be agreed upon by the parties.  In the event that
the parties are able to reach such agreement, the agreed
upon form of termination agreement (the "JV Termination
Agreement") shall be executed by the parties and delivered
into escrow as provided below.  Failure to reach such
agreement shall not affect the parties rights and
obligations under this Agreement and in no event shall such
negotiations or an agreement with respect to the Preliminary
Agreement and the LLC Agreement (i) constitute a condition
to Closing or otherwise affect the parties' obligation to
close the purchase and sale of the Property, or (ii) extend
the Outside Closing Date.


                         ARTICLE IV
                           CLOSING

4.1  Time and Place.

     (a)  Subject to the provisions of Section 4.6 and 4.7 below,
     the consummation of the transaction contemplated hereby
     ("Closing"), as evidenced by the payment and release of the
     Purchase Price to Seller, shall occur on or before the date
     that  is  sixty (60) days after the expiration  of  the
     Inspection Period ("Outside Closing Date") (with the actual
     date of Closing being referred to herein as the "Closing
     Date"), subject to extension pursuant to Section 4.1(b),
     Section 4.8(b) and Section 4.9(c) below.  The Closing shall
     occur through an escrow administered by Escrow Agent with
     the  Purchase Price and all documents (unless otherwise
     mutually agreed) to be deposited with the Escrow Agent as
     escrowee.  If requested by either party, a pre-closing shall
     be held on two (2) business days prior to the scheduled
     Closing Date at the offices of Paul, Hastings, Janofsky &
     Walker  LLP, 515 South Flower Street, 25th  Floor,  Los
     Angeles, California 90071 or, at Seller's option, two (2)
     business days preceding the scheduled Closing Date at a
     location in Hawaii selected by Seller.  At Closing, Seller
     and Purchaser shall perform the obligations set forth in,
     respectively, Section 4.2 and Section 4.3, the performance
     of which obligations shall be concurrent conditions.

     (b)  Hawaii Dislocated Workers Act Notice.  The parties
     understand that under the Hawaii Dislocated Workers' Act
     (Hawaii Revised Statutes, Chapter 394B) relating to plant
     closings and mass layoffs, the sale of the Hotel may result
     in a termination of the employees' employment by Seller, and
     that such Act may be interpreted to require notice to be
     given to the employees at least sixty (60) days prior to the
     change in ownership of the Hotel.  The Outside Closing Date
     shall be extended from time to time as necessary to comply
     with amendments to the Hawaii Dislocated Workers' Act or
     other laws and any such extension shall not be deemed a
     breach of this Agreement by Seller or Purchaser.  Seller
     shall instruct the general manager of the Hotel to provide
     such notice to employees to comply with such Act and/or the
     federal WARN Act (collectively, the "Plant Closing Laws"),
     and any extension of the Closing required by Seller to
     provide for such notice(s) shall not be deemed a breach of
     this Agreement by Seller.

4.2   Seller's  Closing  Obligations  and  Deliveries.    At
Closing,  Land Company or Operating Company, as  applicable,
shall, through Escrow Agent (provided that such items  shall
be delivered to Escrow Agent not later than two (2) business
days  prior to the scheduled Closing Date or, if applicable,
at the pre-closing described in Section 4.1 above):

     (a)  Deliver to Purchaser a duly executed assignment of
     ground lease (the "Hotel Ground Lease Assignment") in the
     form attached hereto as Exhibit B-1 and made a part hereof
     conveying Land Company's leasehold interest under  that
     certain Hotel Ground Lease dated as of October 22, 1985, by
     and between Purchaser, as lessor, and KBH and KBH Operations
     Limited  Partnership, a Hawaii limited partnership  (as
     predecessor-in-interest to Seller), as tenant, as amended by
     (w) that certain Lessor's Consent to Mortgages; Amendment of
     Lease; and Estoppel Certificate, dated June 13, 1990, as
     further amended by (x) that certain Second Amendment of
     Lease dated October 14, 1991, as further amended by (y) that
     certain Third Amendment of Hotel Ground Lease, dated as of
     September 5, 1996, and as further amended by  (z)  that
     certain Fourth Amendment of Hotel Ground Lease, dated as of
     August 31, 1999 (collectively, as amended, the "Hotel Ground
     Lease"), with a conveyance tax certificate attached thereto,
     if applicable.

     (b)  Deliver to Purchaser a duly executed assignment of
     ground lease (the "Restaurant Ground Lease Assignment") in
     the form attached hereto as Exhibit B-2 and made a part
     hereof conveying Operating Company's leasehold interest
     under that certain Restaurant Lease dated October 22, 1985
     between Purchaser and KBH (as predecessor-in-interest to
     Seller), as amended by instruments dated (w) January
     10,1989, (x) December 31, 1991, (y) February 18, 1993 and
     (z) September 5, 1996 (the "Restaurant Ground Lease" and,
     collectively with the Hotel Ground Lease, the "Ground
     Leases"), with a conveyance tax certificate attached
     thereto, if applicable.

     (c)  Execute and deliver to Purchaser at least
     two (2) original counterparts of a bill of sale in the form
     attached hereto as Exhibit C and made a part hereof
     conveying the Personal Property and Consumable Inventory
     without warranty of title or use and without warranty,
     expressed or implied, as to merchantability and fitness for
     any purpose;

     (d)  Execute and deliver to Purchaser at least two (2)
     original counterparts of an assignment of Operating
     Company's interest in the Operating Agreements including,
     without limitation, the Villas Management Agreement, the
     Rental Agreement and, to the extent that the Management
     Agreement is not terminated as of Closing pursuant to
     Section 1.8 above, the Management Agreement (provided,
     however, that for purposes of this Section 4.2(d) only, the
     term "Operating Agreements shall specifically exclude the
     Supplemental Agreement, the Reciprocal Use Agreement and any
     service contracts terminated by Seller effective as of the
     Closing Date), if the Labor Agreement is to be assumed by
     Purchaser as of Closing pursuant to Section 1.9 above, the
     Labor Agreement, the Bookings and the other Intangibles
     ("Assignment of Contracts") in the form attached hereto as
     Exhibit D-1 and made a part hereof;

     (e)  Execute and deliver to Purchaser at least two (2)
     original counterparts of an assignment of Operating
     Company's interest in the Supplemental Agreement
     ("Assignment of Supplemental Agreement") in the form
     attached hereto as Exhibit D-2 and made a part hereof;

     (f)  Execute and deliver to Purchaser at least two (2)
     original counterparts of an assignment of Operating
     Company's interest in the Reciprocal Use Agreement
     ("Assignment of Reciprocal Use Agreement") in the form
     attached hereto as Exhibit D-3 and made a part hereof;

     (g)  Execute and deliver to Purchaser at least two (2)
     original counterparts of an assignment of Operating
     Company's interest in any and all Leases in the form
     attached hereto as Exhibit E and made a part hereof;

     (h)  Deliver to Purchaser a certificate, dated as of the
     date of Closing and executed on behalf of Seller by a duly
     authorized officer thereof, stating that the representations
     and warranties of Seller contained in this Agreement are
     true and correct in all material respects as of the date of
     Closing (with appropriate modifications of those
     representations and warranties made in Section 5.1 hereof to
     reflect any changes therein including without limitation any
     changes resulting from actions under Section 5.4 hereof) or
     identifying any representation or warranty which is not, or
     no longer is, true and correct and explaining the state of
     facts giving rise to the change.  In no event shall Seller
     be liable to Purchaser for, or be deemed to be in default
     hereunder by reason of, any breach of representation or
     warranty which results from any change that (i) occurs
     between the Effective Date and the date of Closing and
     (ii) is expressly permitted under the terms of this
     Agreement or is beyond the reasonable control of Seller to
     prevent; provided, however, that the occurrence of a change
     which is not permitted hereunder or is beyond the reasonable
     control of Seller to prevent shall, if materially adverse to
     Purchaser, constitute the non-fulfillment of the condition
     set forth in Section 4.6(b).  If, despite changes or other
     matters described in such certificate, the Closing occurs,
     Seller's representations and warranties set forth in this
     Agreement shall be deemed to have been modified by all
     statements made in such certificate;

     (i)  Deliver to Purchaser and the Title Company such
     evidence as the Title Company may reasonably require as to
     the authority of the person or persons executing documents
     on behalf of Seller;

     (j)  Deliver to Purchaser an affidavit duly executed by
     Seller stating (i) that Seller is not a "foreign person" as
     defined in the Federal Foreign Investment in Real Property
     Tax Act of 1980 and the 1984 Tax Reform Act, and (ii)
     whether Seller is a resident person (for purposes of
     withholding under the Hawaii Real Property Tax Act) as
     defined in Section 235-68 of Hawaii Revised Statutes, in the
     form attached hereto as Exhibit F and made a part hereof;

     (k)  If not already delivered to Purchaser, deliver to
     Purchaser the Operating Agreements and the licenses and
     permits, if any, in the possession of Seller or Seller's
     agents, together with such leasing and property files and
     records which are material in connection with the continued
     operation, leasing and maintenance of the Property.
     Purchaser shall cooperate with Seller for a period of
     seven (7) years after Closing in case of Seller's need in
     response to any legal requirement, a tax audit, tax return
     preparation or litigation threatened or brought against
     Seller, by allowing Seller and its agents or representatives
     access, upon reasonable advance notice (which notice shall
     identify the nature of the information sought by Seller), at
     all reasonable times to examine and make copies of any and
     all instruments, files and records, which right shall
     survive the Closing;

     (l)  Deliver to the Escrow Agent an executed closing
     statement (the "Closing Statement") consistent with this
     Agreement and in a customary form;

     (m)  Deliver two (2) original copies of the Designation
     Agreement (defined below);

     (n)  Deliver a Tax Clearance Certificate and a Report of
     Bulk Sale for Seller issued by the State of Hawaii
     Department of Taxation;

     (o)  In the event that Seller and Purchaser have agreed upon
     the JV Termination Agreement pursuant to Section 3.4 above,
     execute (or cause its affiliate to execute) and deliver to
     Escrow Agent two (2) original copies thereof;

     (p)  Deliver such additional documents as shall be
     reasonably required to consummate the transaction expressly
     contemplated by this Agreement; and

     (q)  Deliver possession of the Property to Purchaser free
     and clear of the Management Agreement unless Purchaser has
     timely made an election to continue the Management Agreement
     in accordance with Section 1.8 above.

4.3   Purchaser's  Closing Obligations and  Deliveries.   At
Closing,  Purchaser  shall, through Escrow  Agent  (provided
that such items shall be delivered to Escrow Agent not later
than  two  (2) business days prior to the scheduled  Closing
Date  or,  if  applicable, at the pre-closing  described  in
Section 4.1 above):

     (a)  Pay to Seller the full amount of the Purchase Price, as
     increased or decreased by prorations and adjustments as
     herein provided, in immediately available wire transferred
     funds pursuant to Section 1.5 above, it being agreed that at
     Closing the Earnest Money shall be delivered to Seller and
     applied towards payment of the Purchase Price;

     (b)  Join Seller in execution of (or deliver original
     executed counterparts of) the instruments described in
     clauses (a), (b), (d), (e), (f), (g), (l), (m), (o) (if
     applicable) and (p) of Section 4.2 above;

     (c)  Deliver to Seller a letter duly executed by Purchaser,
     confirming that Purchaser is not acquiring the Property with
     the assets of an employee benefit plan as defined in Section
     3(3) of the Employee Retirement Income Security Act of 1974
     ("ERISA"), and, in the event Purchaser is unable or
     unwilling to make such a representation, Purchaser shall be
     deemed to be in default hereunder, and Seller shall have the
     right to terminate this Agreement and to receive and retain
     the Earnest Money;

     (d)  Deliver to Seller a certificate, dated as of the date
     of Closing and executed on behalf of Purchaser by a duly
     authorized officer thereof, stating that the representations
     and warranties of Purchaser contained in this Agreement are
     true and correct in all material respects as of the date of
     Closing;

     (e)  Deliver to Seller such evidence as Title Company may
     reasonably require as to the authority of the person or
     persons executing documents on behalf of Purchaser;

     (f)  Execute and deliver to Escrow Agent two (2) original
     copies of a release of all post-closing obligations of
     Seller under the Hotel Ground Lease and the Restaurant
     Ground Lease from and after the Closing Date in the form of
     Exhibit I attached hereto; and

     (g)  Deliver such additional documents as shall be
     reasonably required to consummate the transaction
     contemplated by this Agreement.

4.4  Credits and Prorations.

     (a)  The following shall be apportioned with respect to the
     Property, as set forth in greater detail in Section 4.4(b)
     below, as of 12:01 a.m., on the Closing Date (the "Cut-Off
     Time"), as if Purchaser were vested with title  to  the
     Property during the entire day upon which Closing occurs:

          (i)  taxes (including personal property taxes on the
          Personal Property) and assessments levied against the
          Property;

          (ii) payments under the Operating Agreements (including,
          without limitation, the Rental Agreements);

          (iii)     water, gas, electricity and other utility charges
          for which Seller is liable, if any, such charges to be
          apportioned at Closing on the basis of (A) for metered
          utilities, the most recent meter reading occurring prior to
          Closing, and (B) for non-metered utilities, a per diem
          apportionment based on the dates of service of such
          utilities with respect to the Cut-Off Time (but in either
          event subject to later readjustment as set forth below);

          (iv) all Receivables including, without limitations,
          receivables accrued in connection with hotel reservations,
          the use of guest rooms, banquet and meeting room receivables
          (including any cancellation fees due to Seller in connection
          with any of the foregoing);

          (v)  All fixed monthly rent, additional rent, escalation
          rent and other sums payable under any Lease or similar
          agreement for use of space at the Hotel (collectively,
          "Rent") in accordance with Section 4.4(b)(xii) below;

          (vi) advance deposits;

          (vii)     operational and/or occupancy taxes;

          (viii)    if the Management Agreement is not terminated as
          of Closing pursuant to Section 1.8 above, management fees
          pursuant to the Management Agreement;

          (ix) charges and fees paid or payable for licenses and
          permits transferred by Seller to Purchaser;

          (x)  any other payables pertaining to the Property, subject
          to later readjustment as set forth in Sections 4.4(d) and
          (e) below; and

          (xi) any other operating expenses or other items pertaining
          to the Property which are customarily prorated between a
          purchaser and a seller for comparable hotel properties
          including, without limitation, any prepaid expenses.

     (b)  Notwithstanding anything contained in the foregoing
     provisions:

          (i)  At Closing, Seller shall receive a credit for all
          refundable cash or other deposits posted with utility
          companies serving the Property or any governmental agencies
          or authorities or posted pursuant to any Operating
          Agreement, or, at Seller's option, Seller shall be entitled
          to receive and retain such refundable cash and deposits.

          (ii) Any taxes paid at or prior to Closing shall be prorated
          based upon the amounts actually paid.  If taxes and
          assessments for the current year have not been paid before
          Closing, Seller shall be charged at Closing an amount equal
          to that portion of such taxes and assessments which relates
          to the period before Closing and Purchaser shall pay the
          taxes and assessments prior to their becoming delinquent.
          Any such apportionment made with respect to a tax year for
          which the tax rate or assessed valuation, or both, have not
          yet been fixed shall be based upon the tax rate and/or
          assessed valuation last fixed.  To the extent that the
          actual taxes and assessments for the current year differ
          from the amount apportioned at Closing, the parties shall
          make all necessary adjustments by appropriate payments
          between themselves following Closing. All necessary
          adjustments shall be made within fifteen (15) business days
          after the tax bill for the current year is received.  Seller
          retains the right to commence, continue and settle any
          proceeding to contest any taxes for any taxable period which
          encompasses any period prior to the date of the Closing, and
          shall be entitled to any refunds or abatements of Taxes
          awarded in such proceedings.

          (iii)     Seller shall receive the entire advantage of any
          discounts for the prepayment by it of any taxes, water rates
          or sewer rents.

          (iv) As to gas, electricity and other utility charges
          referred to in Section 4.4(a)(iii) above, Seller may, on
          notice to Purchaser, elect to pay one or more of all of said
          items accrued to the date hereinabove fixed for
          apportionment directly to the person or entity entitled
          thereto, and to the extent Seller so elects, such item shall
          not be apportioned hereunder, and Seller's obligation to pay
          such item directly in such case shall survive the Closing.

         (v)  As of the date immediately prior to the date of
         Closing, Seller and Purchaser shall jointly conduct or cause
         the Manager to conduct an inventory of all Unopened
         Inventory and shall deliver a written report thereon to
         Seller and Purchaser.  Such report shall reflect the value
         of the Unopened Inventory at the acquisition cost thereof
         and shall be certified by Manager to Seller and Purchaser as
         accurately reflecting all Unopened Inventory at the Hotel
         and the acquisition cost thereof. On account of Purchaser's
         purchase of the Unopened Inventory, Seller shall receive a
         credit at Closing in an amount equal to the total value of
         the Unopened Inventory as reflected in such inventory to the
         extent that such Unopened Inventory has been paid for by
         Seller or will be paid for by Seller.

         (vi) At Closing, Seller shall receive (or receive a credit
         in an amount equal to) all revenue (after the settlement of
         applicable commissions and/or costs) relating to vending
         machines in the Hotel up until the Cut-Off Time.

         (vii)     Revenues from the Hotel guest rooms (other than
         those set forth in clause (x) below) occupied on the evening
         immediately preceding the date of Closing, including any
         sales taxes, room taxes and other taxes charged to guests in
         such rooms with respect to the evening immediately preceding
         the date of Closing shall be divided equally between Seller
         and Purchaser (where a complete meeting package ("CMP")
         guest is staying on a CMP rate, the food and beverage
         revenues shall be allocated based on whether the applicable
         meal or service occurred before or after the Cut-Off Time);
         provided, however, that to the extent that Manager records
         in the ordinary course the times at which food and beverage
         sales, telephone, facsimile or data communication, in-room
         movie, laundry, and other services are ordered by guests,
         then the same shall be allocated between Seller and
         Purchaser based on when orders for the same were received,
         with orders originating prior to the Cut-Off Time being
         allocable to Seller, and orders originating after the Cut-
         Off Time being allocable to Purchaser.  All revenues from
         restaurants and other service operations conducted at the
         Property shall be allocated based on whether the same
         accrued before or after the Cut-Off Time as described in the
         preceding sentence, and Seller shall cause the Manager to
         separately record sales occurring before and after the Cut-
         Off Time at the Property.  The foregoing amounts are
         referred to collectively as "Guest Revenues".
         Notwithstanding the foregoing, all revenues from any bars
         and lounges at the Property shall be prorated based on the
         actual closing time for such bar or lounge.  For example, if
         such bar or lounge closes at 2 a.m. on the Closing Date,
         Seller shall retain the revenues from such services and
         operations even though such revenues were generated two (2)
         hours after the Cut-Off Time.

         (viii)    Revenues from conferences, receptions, meetings,
         and other functions occurring in any conference, banquet or
         meeting rooms in the Hotel, or in any adjacent facilities
         owned or operated by Seller, including usage charges and
         related taxes, food and beverage sales, valet parking
         charges, equipment rentals, and telecommunications charges,
         shall be allocated between Seller and Purchaser, based on
         when the function therein commenced, with (i) one-day
         functions commencing prior to the Cut-Off Time being
         allocable to Seller, (ii) functions commencing after the Cut-
         Off Time being allocable to Purchaser, and (ii) multi-day
         functions being allocated between Seller and Purchaser
         according to when the event commences and is scheduled to
         end.  The foregoing amounts are referred to collectively as
         "Conference Revenues."

         (ix) Purchaser shall receive a credit at Closing in an
         amount equal to one hundred percent (100%) of all advance
         deposits that shall have been received by or credited to
         Seller prior to the Cut-Off Time on account of reservations
         for use or occupancy of the Property after the Cut-Off Time.

         (x)  To the extent not actually collected by Seller or
         Manager prior to the Cut-Off Time, all Guest Revenues and
         Conference Revenues allocated to Seller hereunder and not
         paid in cash prior to the Cut-Off Time including Seller's
         city ledger, guest ledger and any other receivable ledgers
         shall together constitute Receivables hereunder and shall be
         purchased by Purchaser at Closing.  On account of
         Purchaser's purchase of the Receivables, Seller shall
         receive a credit at Closing in an amount equal to (A) 100%
         of the guest ledger amount, and (B) 98% of the city ledger
         amount, of the Receivables as reflected in the books of the
         Manager, as apportioned between Seller and Purchaser in
         accordance with this Section 4.4. After Closing, Purchaser
         shall have the exclusive right to collect all Receivables,
         and Seller shall have no further rights or interests
         therein.  Purchaser shall have no right to any adjustment to
         the prorations with respect to the Receivables on or after
         Closing, for inability to collect outstanding Receivables or
         otherwise.

         (xi) Rent shall be prorated as of the Closing Date.
         Percentage rent or overage rent (referred to herein as
         "Percentage Rent") under the Leases shall be prorated
         between Purchaser and Seller on a Lease by Lease basis with
         Seller entitled to the portion of total Percentage Rent paid
         under each Lease for the Lease Year (as defined below) in
         which the Closing occurs (the "Subject Lease Year") which is
         in the same ratio to total Percentage Rent paid with respect
         to such Lease Year under the subject Lease as the ratio of
         (A) the number of days of said Lease Year which Seller was
         the landlord under the subject Lease to (B) the total number
         of days in said Subject Lease Year.  Purchaser shall be
         entitled to the balance of Percentage Rent paid under each
         Lease with respect to the Subject Lease Year.  As used
         herein, the term "Lease Year" means the twelve (12) month
         period (or, as to tenants for which the Closing occurs
         during a partial Lease Year, such applicable shorter period)
         as to which annual Percentage Rent is owed under each Lease.
         The foregoing proration shall be made as follows on a Lease
         by Lease basis: (i) for each Lease, not later than thirty
         (30) days after the date the last Percentage Rent payment
         with respect to the Subject Lease Year is due, Purchaser
         shall deliver to Seller a statement of all Percentage Rent
         owed, collected or deemed collectable by Purchaser with
         respect to such Lease along with a copy of the annual
         reconciliation of Percentage Rent owed under the subject
         Lease for the Subject Lease Year and the related sales
         information backup; and, (ii) for each Lease, within fifteen
         (15) days after the date the statement and reconciliation
         described in clause (i) above is delivered to Seller,
         Purchaser shall pay to Seller or Seller shall pay to
         Purchaser, whichever is applicable, the positive difference
         between (a) the total Percentage Rental collected by such
         party with respect to the Subject Lease Year and (b) the
         product of (x) the average daily Percentage Rental received
         with respect to the Subject Lease Year after taking into
         account the annual reconciliation and (y) the actual number
         of days such party was the owner of the Property during the
         Subject Lease Year (with Purchaser being deemed to be the
         owner as of the Closing).  If Percentage Rent is thereafter
         collected by Purchaser from delinquent tenants, Purchaser
         shall promptly pay to Seller a portion thereof which is
         equal to the ratio of (aa) the number of days of the subject
         Lease Year in which Seller was the landlord under the
         subject Lease has to (bb) the total number of days in the
         Lease Year.  Seller shall have the right, upon reasonable
         notice but no more often than twice in any twelve (12) month
         period, to audit Purchaser's books and records to verify the
         amount of Percentage Rent which has actually been collected
         by Purchaser.

         (xii)     Purchaser shall be entitled to a credit for all
         unapplied and refundable security and other deposits
         retained by Seller as of the Closing Date with respect to
         any Leases at the Hotel.

         (xiii)    Subject to the provisions of this Section
         4.4(b)(xiii), Seller shall be responsible for all wages and
         other amounts owed to Seller's employees at the Property
         relating to the period prior to the Cut-Off Time and
         Purchaser shall be responsible for all wages and other
         amounts due to employees at the Property relating to the
         period after the Cut-Off Time.  The obligation to pay or
         reimburse the Manager for the wages, salaries, and other
         benefits of employment of employees of Seller, together with
         applicable employment and withholding taxes of such
         employees, shall be allocated between Purchaser and Seller
         as follows:

               (1)  Hourly  Employees:  (A) wages of  hourly
                    employees  shall be allocated  according
                    to  hours worked during the current  pay
                    period  before  and  after  the  Cut-Off
                    Time;  (B)  employment  and  withholding
                    taxes  for  the current pay  period  for
                    such employees shall be allocated in the
                    same   manner  as  wages;  (C)   accrued
                    vacation  and  sick leave  and  required
                    contributions  to  health,  pension  and
                    other  benefit plans for such  employees
                    shall be allocated on the basis used  by
                    Manager  under the Management  Agreement
                    for  allocating such costs to particular
                    accounting  periods,  with  such   costs
                    attributable to the accounting period in
                    which  the date of Closing occurs to  be
                    allocated  on a per diem basis according
                    to  the  number of days in  the  current
                    period  occurring before and  after  the
                    Cut-Off  Time;  (D) Purchaser  shall  be
                    responsible   for  all   severance   pay
                    (including  separation pay, as  such  is
                    term  used in the Labor Agreement)  with
                    respect    to    discharged    employees
                    (regardless  of  whether  discharged  by
                    Seller  in connection with the  sale  of
                    the   Hotel   or   after   Closing    by
                    Purchaser).

               (2)  Salaried    Employees:   the   salaries,
                    employment   and   withholding    taxes,
                    accrued vacation, sick leave, and  other
                    employment    benefits   for    salaried
                    employees  shall  be  allocated  on  the
                    basis  used  by  the Manager  under  the
                    Management Agreement for allocating such
                    costs  to particular accounting periods,
                    with  such  costs during the  accounting
                    period  in  which  the date  of  Closing
                    occurs  to  be allocated on a  per  diem
                    basis according to the number of days in
                    the  current period occurring before and
                    after  the Cut-Off Time. Purchaser shall
                    be  responsible  for all  severance  pay
                    (including separation pay, as such  term
                    is  used  in  the Labor Agreement)  with
                    respect    to    discharged    employees
                    (regardless  of  whether  discharged  by
                    Seller  in connection with the  sale  of
                    the   Hotel   or   after   Closing    by
                    Purchaser).

               (3)  Purchaser acknowledges that the Purchase
                    Price has already been reduced by Seller
                    in    consideration   of     Purchaser's
                    agreement  to  be  responsible  for  all
                    severance     obligations     (including
                    separation pay obligations, as such term
                    is  used in the Labor Agreement) due  to
                    discharged    employees.    Accordingly,
                    Purchaser  shall have no  right  to  any
                    post-closing adjustment  to the Purchase
                    Price  or  prorations made on  or  after
                    Closing with respect to severance pay or
                    separation  pay coming due on  or  after
                    Closing,  irrespective of  whether  such
                    severance  obligations  change  or   are
                    recalculated following the Closing.

     Notwithstanding any provision of this  Section  4.4  to
the  contrary, to the extent required by the Labor Agreement
or  applicable law, accrued wages, vacation pay, health  and
welfare payments and other amounts accrued as of the Closing
Date and due to employees of the Hotel which are to be borne
by  Seller  under the express provisions of this  Agreement,
shall be paid at closing by Seller and shall not be prorated
(in  lieu  of  Purchaser  receiving  a  credit  therefor  at
Closing).   This  provision is not  intended  to  alter  the
allocation of costs between Seller and Purchaser as provided
herein.

          (xiv)     If the Management Agreement is not terminated at
          Closing pursuant to Section 1.8 above: (x) those fees and
          other compensation payable to the Manager under the
          Management Agreement which are earned prior to the Cut-Off
          Time shall be the responsibility of Seller, and the fees and
          other compensation payable to the Manager under the
          Management Agreement which are earned after the Cut-Off Time
          shall be the responsibility of Purchaser, (y) the amount
          earned for such period shall be determined based on the
          provisions of the Management Agreement in accordance with
          the allocations of revenue and expense items under this
          Agreement, and (z) on the Closing Date, the parties shall
          estimate, and Purchaser shall receive a credit for, Seller's
          share of accrued but unpaid management fees due under the
          Management Agreement and reimbursable expenses as of the
          Closing Date.

          (xv) The parties acknowledge that certain taxes accrue and
          are payable to the various local governments by any business
          entity operating a hotel and its related facilities.
          Included in those taxes may be business and occupation
          taxes, retail sales taxes, gross receipts taxes, and other
          special lodging or hotel taxes. For purposes of this
          Agreement, all of such taxes (expressly excluding taxes and
          assessments covered elsewhere in this Section 4.4 or in
          Section 4.5 or corporate franchise taxes, and federal, state
          and local income taxes) shall be allocated between Seller
          and Purchaser such that those attributable to the period
          prior to the Cut-Off Time shall be allocable to Seller and
          those attributable to the period after the Cut-Off Time
          shall be allocable to Purchaser (with the attribution of
          such taxes hereunder to be done in a manner consistent with
          the attribution under this Agreement of the applicable
          revenues on which such taxes may be based).  Seller shall be
          solely responsible for payment of such taxes with respect to
          the period prior to the Cut-Off Time, and Purchaser shall be
          solely responsible for payment of such taxes with respect to
          the period after the Cut-Off Time; provided, that, the
          parties may make an estimate of the amount of Seller's share
          of such taxes accrued but not paid up to the Cut-Off Time
          and credit the amount so estimated to Purchaser at Closing,
          and in such case, to the extent of such credit, Purchaser
          shall be responsible for the payment of such taxes when due
          after the date of Closing and Seller shall not be liable for
          the amount of such taxes so credited to Purchaser; and
          provided further, that to the extent reasonably possible,
          the parties shall ascertain the amounts of such taxes
          allocable to Seller within the 90-day period following the
          date of Closing (concurrently with their determination of
          the amounts of the revenues allocable to Seller pursuant to
          Section 4.4(b)(xi) hereof), and if the parties shall agree
          on the amount thereof, Purchaser may deduct Seller's share
          of such taxes from the amounts of revenues payable to Seller
          (and Seller shall not be further liable for the taxes so
          deducted) and, if the amount due Purchaser exceeds the
          revenues payable to Seller, Seller shall promptly pay any
          excess to Purchaser.  If the parties are unable to agree on
          such amounts, the dispute thereon shall be resolved by the
          Outside Accountant as provided in Section 4.4(e) below.

          (xvi)     Seller shall receive a credit at Closing in an
          amount equal to the balance of the House Bank Funds as of
          the Cut-Off Time.

          (xvii)    Purchaser shall (A) honor all outstanding
          unexpired gift certificates, coupons, vouchers or other
          writings issued by Seller that entitles the holder or bearer
          thereof to a credit (whether in a specified dollar amount as
          for a specified item, such as room night or meals) to be
          applied against the usual charge for rooms, meals and/or
          goods and services at the Hotel (collectively, "Vouchers")
          and shall assume all liability, if any, for all outstanding
          Vouchers as of the Closing Date regardless of any purported
          expiration, (B) receive a credit against the Purchase Price
          payable at Closing as set forth in Schedule 4.4(b)(xvii)
          attached hereto and incorporated herein by this reference
          (such Schedule 4.4(b)(xvii) to be updated at Closing), and
          (C) indemnify, defend and hold Seller harmless from and
          against all claims, liabilities, costs and expenses arising
          out of the Vouchers from and after the Closing Date.  The
          provisions of this Section 4.4(b) (xvii) shall survive the
          Closing without limit.

     (c)  Apportionment Credit.  In the event the apportionments
     to be made at the Closing result in a credit balance (i) to
     Purchaser, such sum shall be paid (at Seller's option) at
     the  Closing  by giving Purchaser a credit against  the
     Purchase Price in the amount of such credit balance, or
     (ii) to Seller, Purchaser shall pay the amount thereof to
     Escrow Agent concurrently with the balance of the Purchase
     Price, to be delivered to Seller at Closing together with
     the net proceeds of the Purchase Price by wire transfer of
     immediately available funds to the account or accounts to be
     designated by Seller for the payment of the balance.  Except
     as otherwise expressly provided herein, in any case in which
     Purchaser receives a credit at Closing on account of any
     obligation of Seller hereunder, Seller shall have no further
     liability for such obligation to the extent of the credit so
     given, and Purchaser shall pay and discharge the same.

     (d)  Closing Statement; Post-Closing Adjustments.  The
     accounting staff of Seller ("Seller's Accountants") and the
     accounting staff of Purchaser ("Purchaser's Accountants")
     shall jointly make such inventories, examinations and audits
     of the Property, and of the books and records pertaining to
     the Property, as Seller's Accountants and Purchaser's
     Accountants may deem necessary to make the adjustments and
     prorations required under this Section 4.4, or under any
     other provisions of this Agreement.  All such adjustments
     and prorations shall be made in accordance with the
     provisions of this Agreement and, to the extent not in
     conflict with the express provisions of this Agreement,
     otherwise in accordance with generally accepted accounting
     principles ("GAAP").  Based upon the results thereof, Seller
     will prepare and deliver to Purchaser for its review and
     approval prior to Closing a statement of prorations (the
     "Prorations Statement") which shall (i) contain the best
     estimate of Seller's Accountants of the amounts of the items
     requiring the prorations and adjustments in accordance with
     this Agreement and (ii) following approval by Purchaser's
     Accountants, be the basis upon which the prorations and
     adjustments provided for herein shall be made at the
     Closing. The Prorations Statement shall be binding and
     conclusive on all parties hereto to the extent of the items
     covered by the Prorations Statement, except (A) where this
     Agreement expressly provides for further adjustment of such
     amounts after Closing, and (B) as otherwise provided in
     Section 4.4(e) below.

     (e)  Delayed Adjustment; Disputes. Except for prorations for
     real estate taxes and other assessments, which shall be
     adjusted within fifteen business (15) days of receipt of the
     tax bill for the tax year in which the Closing occurs,
     Purchaser and Seller shall make a one time post-Closing
     adjustment of any item of income and expense (excluding
     Percentage Rent which shall be adjusted as set forth above)
     subject to adjustment as provided above which was either
     incomplete or incorrect (whether as a result of an error in
     calculation or a lack of complete and accurate information)
     as of the Closing, and the party in whose favor the original
     incorrect adjustment or error was made ("Adjusting Party")
     shall promptly pay to the other party ("Requesting Party")
     the sum necessary to correct such prior incorrect adjustment
     or error.   Notwithstanding any provision of this Agreement
     to the contrary, all items required to be adjusted pursuant
     to this Section 4.4 shall be adjusted within sixty (60) days
     of Closing (except real estate taxes, which shall be re-
     adjusted within the period set forth above), and such
     adjustment shall be final and no further adjustment to the
     prorations or the Purchase Price shall be made.

     (f)  Resolution of Disputes.  Subject to Section 4.4.(e)
     above, within ten (10) business days after receipt of
     written notice of any such adjustment from the Requesting
     Party to the Adjusting Party, the Adjusting Party shall
     either (i) pay to the Requesting Party the amount of such
     excess credit, or (ii) notify the Requesting Party in
     writing that it disputes the adjustment being claimed.  In
     the case of a dispute, the parties shall attempt to resolve
     such dispute, but if for any reason such dispute is not
     resolved by the date that is ten (10) days after the
     delivery of the original notice of the claimed adjustment by
     Purchaser or Seller, but not to exceed sixty (60) days after
     Closing, then the parties shall submit such dispute to
     Deloitte & Touche, LLP ("Outside Accountants"), and the
     determination of the Outside Accountants, which shall be
     made within a period of fifteen (15) days after such
     submittal by the parties, shall be conclusive.  The fees and
     expenses of the Outside Accountants shall be paid equally by
     Purchaser and Seller.  At such time as the amount of any
     adjustment or dispute shall be determined (either by
     agreement or by determination of the Outside Accountants),
     any amount that shall be payable by the Requesting Party to
     the Adjusting Party as a result of such adjustment or
     determination shall be paid within ten (10) business days
     after the date on which such agreement or determination
     shall have been made.

     (g)  The provisions of this Section 4.4 shall survive
     Closing.

4.5   Closing Costs.  Seller shall pay (a) the fees  of  any
counsel representing it in connection with this transaction,
(b)  the  documentary transfer tax or conveyance tax payable
by reason of the transfer of the Real Property, (c) the fees
for   recording  the  Hotel  Ground  Lease  Assignment,  the
Restaurant  Ground Lease Assignment and any reconveyance  or
release  of  any leasehold mortgage affecting  the  Property
that  will  be reconveyed or released at Closing, (d)  sixty
percent  (60%) of the CLTA portion of the Title Policy,  (e)
any  bulk sales tax, general excise tax or sales tax payable
on  the sale of the Personal Property (or any part thereof),
and (f) one-half (1/2) of any escrow fee which may be charged
by  the  Escrow Agent.  Purchaser shall pay (i) the fees  of
any  counsel representing Purchaser in connection with  this
transaction, (ii) the premium for the Title Policy in excess
of  the  amount required to be paid by Seller as  set  forth
above,  plus  100%  of the cost of any endorsements  to  the
Title  Policy, and the cost of any title insurance  provided
to  Purchaser's lender, (iii) the cost of the  Survey,  (iv)
any taxes other than those required to be paid by Seller  as
set  forth above (including any transfer tax or similar  tax
imposed by the Association, if any), and (v) one-half (1/2) of
any  escrow  fees  charged by the Escrow Agent.   All  other
costs  and  expenses  incident to this transaction  and  the
closing  thereof  shall be paid in a manner consistent  with
custom   for   similar   transactions   in   Maui,   Hawaii.
Notwithstanding  the  foregoing,  in  the  event  that  this
Agreement  is  terminated as a result of a party's  default,
such  defaulting  party  shall  pay  all  escrow  and  title
cancellation   fees   charged  in   connection   with   such
cancellation.

4.6  Conditions Precedent to Obligation of Purchaser.  The
obligation of Purchaser to consummate the transaction
hereunder shall be subject to the fulfillment on or before
the date of Closing of all of the following conditions, any
or all of which may be waived by Purchaser in its sole
discretion:

     (a)  Seller shall have delivered to Purchaser or deposited
     with Escrow Agent all of the items required to be delivered
     to Purchaser or deposited with Escrow Agent pursuant to the
     terms of this Agreement, including but not limited to, those
     provided for in Section 4.2.

     (b)  All of the representations and warranties of Seller
     contained in this Agreement shall be true and correct in all
     material respects as of the date of Closing (with
     appropriate modifications permitted under this Agreement or
     not materially adverse to Purchaser).

     (c)  Seller shall have performed and observed, in all
     material respects, all covenants and agreements of this
     Agreement to be performed and observed by Seller as of the
     date of Closing.

     (d)  Title Company (or another nationally recognized title
     company licensed to do business in Hawaii) shall be
     committed to issue the Title Policy in the amount of the
     Purchase Price and showing title to the Real Property vested
     in Purchaser subject only to the Permitted Exceptions (and
     any items to be recorded at Closing).

     (e)  The Department of Liquor Control - County of Maui shall
     be prepared to issue to Purchaser, upon receipt of evidence
     of the transfer of the Hotel promptly following Closing, a
     temporary liquor license that allows the service of alcohol
     at the Hotel.

     (f)  Purchaser shall have received either (i) an executed
     estoppel certificate from Manager in substantially the form
     attached hereto as Exhibit H-1, (ii) an executed estoppel
     certificate from Manager containing the Required Information
     (as defined below) or (iii) an executed estoppel certificate
     in the form attached hereto as Exhibit H-3.

4.7   Conditions  Precedent to Obligation  of  Seller.   The
obligation of Seller to consummate the transaction hereunder
shall be subject to the fulfillment on or before the date of
Closing  of all of the following conditions, any or  all  of
which may be waived by Seller in its sole discretion:

     (a)   Seller shall have received the Purchase Price  as
     adjusted pursuant to and payable in the manner provided for
     in this Agreement.

     (b)  Purchaser shall have delivered to Seller all of the
     items required to be delivered to Seller pursuant to the
     terms of this Agreement, including but not limited to, those
     provided for in Section 4.3.

     (c)  All of the representations and warranties of Purchaser
     contained in this Agreement shall be true and correct in all
     material respects as of the date of Closing.

     (d)  Purchaser shall have performed and observed, in all
     material respects, all covenants and agreements of this
     Agreement to be performed and observed by Purchaser as of
     the date of Closing.

     (e)  Purchaser shall have released Seller, in writing, in
     the form attached hereto as Exhibit "I", from all of its
     obligations under the Ground Leases arising on or after the
     Closing Date.

4.8  Failure of Waiver of Conditions Precedent.

     (a)  Subject to the provisions of Section 4.8(b) below, in
     the event any of the conditions set forth in Sections 4.6 or
     4.7 are not fulfilled or waived on or before the Outside
     Closing Date, the party benefited by such conditions may, by
     written notice to the other party, terminate this Agreement,
     whereupon all rights and obligations hereunder of each party
     shall be at an end except those that expressly survive any
     termination.  Either party benefited by a condition set
     forth in Sections 4.6 and 4.7 above may, at its election, at
     any time or times on or before the date specified for the
     satisfaction of the condition, waive in writing the benefit
     of such condition.  Purchaser's consent to the close of
     escrow pursuant to this Agreement shall waive any remaining
     unfulfilled conditions, and any liability on the part of
     Seller for breaches of representations and warranties of
     which Purchaser had knowledge as of the Closing.

     (b)  Notwithstanding the provisions of Section 4.8(a) above,
     prior to Purchaser's termination of this Agreement as a
     result of a failure of the condition precedent set forth in
     Section 4.6(d) above, Purchaser shall give Seller, on or
     before the Outside Closing Date then in effect, written
     notice of any such failure and (i) Seller shall have a
     thirty (30) day period within which to cure any such
     failure, and (ii) the Outside Closing Date shall be extended
     until the earlier of (A) the expiration of such thirty (30)
     day period, or (B) Seller's cure of such failure.

4.9  Alcoholic Beverage License.

     (a)  Purchaser acknowledges that Operating Company is the
     holder of the current alcoholic beverage license(s) for the
     Hotel  (collectively, the "Existing  Liquor  License").
     Operating  Company  shall cooperate with  Purchaser  in
     arranging for the transfer of the Existing Liquor License to
     Purchaser, provided that such transfer and cooperation shall
     (i) not create any potential liability for Seller and (ii)
     be at no cost or expense to Seller; provided that in no
     event shall Seller be required to transfer to Purchaser any
     alcoholic beverage inventory which is located at or held for
     use in the Hotel unless and until Purchaser has obtained a
     valid and effective license entitling Purchaser to sell
     alcoholic beverages at the Hotel.

     (b)  Within five (5) days following the Effective Date,
     Purchaser shall file all necessary applications and
     supporting materials with the Department of Liquor Control -
     County of Maui as may be required to obtain a permanent or
     temporary liquor license for the Hotel, and shall diligently
     pursue in good faith the issuance of such liquor license by
     the Outside Closing Date (including, without limitation,
     promptly responding to all requests and questions from the
     Department of Liquor Control - County of Maui).
     Concurrently with submission of such applications and
     materials, Purchaser shall provide Seller with a copy
     thereof (provided that, unless a dispute arises between
     Seller and Purchaser under this Agreement with respect to
     Purchaser's efforts to obtain a liquor license, Purchaser
     shall be entitled to redact any personal information on any
     application submitted by an individual).  Purchaser shall
     also provide Seller with copies of any correspondence to and
     from the Department of Liquor Control - County of Maui in
     connection with the liquor license application.  Time is of
     the essence with respect to the provisions of this
     Section.4.9(b).

     (c)  Notwithstanding anything herein to the contrary, if,
     despite Purchaser's compliance with Section 4.9(b) above,
     the Department of Liquor Control - County of Maui is not
     prepared, as of the Outside Closing Date, to issue to
     Purchaser or Purchaser's designee, promptly following
     Closing upon receipt of evidence of the transfer of the
     Hotel, either a temporary liquor license or a permanent
     liquor license that allows the service of alcohol at the
     Hotel, Purchaser shall have the one-time right, by providing
     Seller and Escrow Agent with prior written notice delivered
     not less than five (5) business days prior to the Outside
     Closing Date, to extend the Outside Closing Date for up to
     thirty (30) days following the original Outside Closing Date
     by making an additional deposit of Five Million Dollars
     ($5,000,000.00) in cash (or a letter or credit in favor of
     Seller in a form and issued by a bank reasonably acceptable
     to Seller) (the "Extension Deposit") with Escrow Agent.  The
     Extension Deposit shall be deemed to be a part of the
     Earnest Money for all purposes of this Agreement and shall
     be applied against the Purchase Price at Closing.

     (d)  Purchaser shall keep Seller apprised of its progress in
     obtaining a liquor license for the Hotel (temporary and/or
     permanent).

4.10  Designation Agreement.  On or before the Closing Date,
Seller   and  Purchaser  shall  each  execute  an   original
counterpart of a Designation Agreement, substantially in the
form   of  Exhibit  G  attached  hereto,  which  Designation
Agreement names the Title Company as the "Reporting  Person"
under  Section  6045(e) of the Internal  Revenue  Code  (the
"Designation Agreement").

4.11 Disbursements and Other Actions by Escrow Agent.  Upon
the Closing, Escrow Agent shall promptly undertake all of
the following in the following order and manner:
     (a)   Cause  the  Hotel  Ground Lease  Assignment,  the
Restaurant  Ground  Lease  Assignment,  the  Assignment   of
Supplemental Agreement and the Assignment of Reciprocal  Use
Agreement  and any other documents which the parties  hereto
may  mutually  direct  to  be  recorded  in  the  Bureau  of
Conveyances of the State of Hawaii and/or the Land Court  of
the State of Hawaii, as appropriate;

     (b)   Disburse  to  Seller  from  funds  deposited   by
Purchaser  with Escrow Agent towards payment  of  all  items
(including,   without   limitation,  the   Purchase   Price)
chargeable to the account of Purchaser;

     (c)  Deliver to Seller a fully executed original of the
instruments  described in clauses (a), (c), (d),  (i),  (j),
(k)  and (o) of Section 4.2 above and clauses (c), (d),  (f)
and (g) of Section 4.3 and a conformed copy of the documents
to be recorded that are listed in Section 4.11(a) above;

     (d)  Deliver to Purchaser a fully executed original  of
the  instruments described in clauses (a),  (b),  (c),  (d),
(e),  (g), (i), (j) (k) and (o) of Section 4.2 above  and  a
conformed  copy  of  the documents to be recorded  that  are
listed in Section 4.11(a) above;

     (e)  Direct the Title Company to issue the Title Policy
to Purchaser; and

     (f)  File the Designation Agreement.



                          ARTICLE V
          REPRESENTATIONS, WARRANTIES AND COVENANTS

5.1   Representations  and  Warranties  of  Seller.   Seller
hereby makes the following representations and warranties to
Purchaser as of the Effective Date:

     (a)  Organization and Authority.  Each of Land Company and
     Operating Company has been duly organized and is validly
     existing under the laws of Delaware.  Seller has the full
     right and authority to enter into this Agreement and to
     transfer  all of the Property to be conveyed by  Seller
     pursuant hereto and to consummate or cause to be consummated
     the transactions contemplated herein to be made by Seller.
     The person signing this Agreement on behalf of Seller is
     authorized to do so.

     (b)  Pending Actions.  There is no action, suit,
     arbitration, unsatisfied order or judgment, government
     investigation or proceeding pending against Seller which, if
     adversely determined, could individually or in the aggregate
     materially interfere with the consummation of the
     transaction contemplated by this Agreement.

     (c)  Leases.  Except as otherwise disclosed in the Reports,
     the Property Information or the due diligence materials
     provided to Purchaser, the list of Leases attached hereto as
     Schedule 1.1(h) is accurate in all material respects and
     lists all Leases currently affecting the Hotel, and Seller
     has delivered (or otherwise made available to Purchaser) a
     true and correct copy of such Leases.  Except for the
     Leases, to Seller's knowledge, there are no other leases or
     occupancy agreements to which Seller is a party affecting
     the Property.

     (d)  No Violations.  To Seller's knowledge, Seller has not
     received prior to the Effective Date any written
     notification from any governmental or public authority (i)
     that the Hotel is in violation of any applicable fire,
     health, building, use, occupancy or zoning laws where such
     violation remains outstanding and, if unaddressed, would
     have a material adverse effect on the use of the Property as
     currently owned and operated or (ii) that any work is
     required to be done upon or in connection with the Property,
     where such work remains outstanding and, if unaddressed,
     would have a material adverse effect on the use of the
     Property as currently owned and operated.

     (e)  Condemnation.  To Seller's knowledge, no condemnation
     proceedings relating to the Real Property are pending.

     (f)  Environmental Matters.  Except as set forth in the
     Reports, a copy of which have been delivered to Purchaser or
     as otherwise disclosed to Purchaser, to Seller's knowledge,
     Seller has received no written notification that any
     governmental or quasi-governmental authority has determined
     that there are any material violations of environmental
     statutes, ordinances or regulations affecting the Property.

     (g)  Operating Agreements.  Except as set forth in the due
     diligence materials provided to Purchaser, to Seller's
     knowledge, neither Seller nor any other party to any of the
     Operating Agreements listed on Schedule 5.2(g) is in
     material default under such agreements beyond any applicable
     notice and cure period.

     (h)  Documents.  To Seller's knowledge, all documents listed
     on Schedule 5.2(g) attached hereto and delivered to
     Purchaser by or on behalf of Seller are true and correct
     copies of the originals in all material respects.

5.2   Knowledge  Defined.  For purposes of  this  Agreement,
"knowledge"  means  (a) with respect to Seller,  the  actual
knowledge of Jill Johnson, Mark Hillis, Bo Reddic  and  John
Buza  (provided that, in no event shall any such person have
any   personal  liability  arising  under  this  Agreement),
without  any duty of inquiry or investigation, and expressly
excluding  the knowledge of any other shareholder,  partner,
member,  trustee,  beneficiary, director, officer,  manager,
employee,  agent or representative of Seller or any  of  its
affiliates,  and  (b)  with respect to  Purchaser,  (i)  the
actual  knowledge of David Cole, Paul Meyer, Ryan  Churchill
and  Robert Werle (provided that, in no event shall any such
person  have  any  personal  liability  arising  under  this
Agreement)  and  expressly excluding the  knowledge  of  any
other  shareholder,  partner, member, trustee,  beneficiary,
director,    officer,    manager,   employee,    agent    or
representative  of Purchaser or any of its Affiliates,  (ii)
any  matter disclosed in any exhibits or schedules  to  this
Agreement, (iii) any matter disclosed in any of the Reports,
the  Property  Information or the  due  diligence  materials
provided  to  Purchaser or any other documents or  materials
provided  by  Seller  or its agents to  Purchaser  prior  to
Closing,  and  (iv)  any  matter  disclosed  by  Purchaser's
inspections  or  investigations of the  Property.   For  the
purposes  of  this  definition, the term "actual  knowledge"
means,  with respect to any person, the conscious  awareness
of  such  person  at  the  time in question,  and  expressly
excludes  any  constructive  or implied  knowledge  of  such
person.

5.3  Survival of Seller's Representations and Warranties.
The representations and warranties of Seller set forth in
Section 5.1 as updated by the certificate of Seller to be
delivered to Purchaser at Closing in accordance with Section
4.2(h) hereof, shall survive Closing for a period of one (1)
year.  No claim for a breach of any representation or
warranty of Seller shall be actionable or payable unless
each of the following are satisfied: (a) the breach in
question results from or is based on a condition, state of
facts or other matter which were not known to Purchaser
prior to Closing, (b) the valid claims for all such
breaches, if any, collectively aggregate more than One
Hundred Thousand Dollars ($100,000), in which event the full
amount of such claims shall be actionable, and (c) written
notice containing a description of the specific nature of
such breach shall have been given by Purchaser to Seller
prior to the expiration of said one (1) year period and an
action shall have been commenced by Purchaser against Seller
within thirty (30) days after the termination of the
survival period provided for above in this Section 5.3
(except that if Purchaser is seeking recovery from any third
party as provided in the following sentence, Purchaser shall
only be required to provide written notice to Seller within
the one hundred eighty day period and shall not be required
to commence an action against Seller to preserve its
claims).  Purchaser agrees to first seek recovery under any
insurance/title policies, the Leases and the Operating
Agreements (including, without limitation, the Management
Agreement) prior to seeking recovery from Seller, and Seller
shall not be liable to Purchaser if Purchaser's claim is
satisfied from such insurance policies or agreements.  As
used herein, the term "Cap" shall mean the total aggregate
amount of One Million Five Hundred Thousand Dollars
($1,500,000). In no event shall (i) Seller's aggregate
liability to Purchaser for breach of any representation or
warranty of Seller in this Agreement (as modified by any
certificate to be delivered by Seller at Closing pursuant to
Section 4.2(h) hereof), or any other claim whatsoever by
Purchaser against Seller hereof exceed the amount of the
Cap, or (ii) Seller be liable for any consequential or
punitive damages.

5.4   Covenants  of  Seller.  Seller hereby  covenants  with
Purchaser as follows:

     (a)  Seller hereby covenants and agrees that from and after
     the Effective Date until the Closing or earlier termination
     of this Agreement, Seller shall use reasonable efforts to
     cause  Manager  (subject to the terms,  conditions  and
     restraints in the Management Agreement) to operate  and
     maintain the Hotel in a manner generally consistent with the
     manner  in  which Seller caused Manager to operate  and
     maintain the Hotel prior to the Effective Date.  Purchaser
     acknowledges that Seller's ability to control the operation
     of  the Hotel is limited by the terms of the Management
     Agreement.

     (b)  From the Effective Date hereof until Closing or the
     earlier termination of this Agreement, Seller use
     commercially reasonable efforts to shall perform its
     material obligations under the Management Agreement, the
     Operating Agreements and other agreements that may affect
     the Property.

     (c)  Seller shall, (1) promptly after the mutual execution
     of this Agreement by Seller and Purchaser, deliver to
     Manager an estoppel certificate in the form attached hereto
     as Exhibit H-1 (the "Broad Form Estoppel") and, (2) within
     thirty (30) days after the expiration of the Inspection
     Period, deliver to each tenant of the Real Property under
     the Leases, an estoppel certificate in the form attached to
     or otherwise provided in the applicable lease or agreement
     or, if no form is required, substantially the form of
     Exhibit H-2 attached hereto (collectively, the "Estoppels"),
     and shall request that Manager and the tenants complete and
     sign the Estoppels and return them to Seller.  Seller shall
     deliver copies of the completed Estoppels to Purchaser as
     Seller receives them (whether received before or after
     Closing).  Further:

          (i)  In the event that Manager executes the Broad Form
          Estoppel or some other form of statement that contains, at a
          minimum, the Required Information, and delivers the same to
          Seller prior to the expiration of the Inspection Period,
          Seller shall have no further obligation with respect to
          delivery of an estoppel certificate from the Manager and the
          condition set forth in Section 4.6(f) above shall be deemed
          satisfied.

          (ii) In the event that Manager does not execute the Broad
          Form Estoppel (or some other form of statement that
          contains, at a minimum, the Required Information) on or
          before the expiration of the Inspection Period, Seller shall
          deliver to Manager an estoppel certificate in the form
          attached hereto as Exhibit H-3 and shall request that
          Manager complete and sign the same.

          (iii)     In the event that (1) Manager does not provide the
          Broad Form Estoppel but does provide on or before the
          expiration of the Inspection Period some form of statement
          that contains, at a minimum, the Required Information, and
          (2) Purchaser elects not to assume the Management Agreement
          at Closing pursuant to Section 1.8 above, Seller shall, for
          the purpose of updating the statement as to the Required
          Information, not more than forty-five (45) days prior to the
          scheduled Closing Date, deliver to Manager an estoppel
          certificate in the form attached hereto as Exhibit H-3 and
          shall request that Manager complete and sign the same prior
          to the Closing Date.  Receipt of such updated statement as
          to the Required Information shall not be a condition to
          Purchaser's obligation to close.

          (iv) As used herein, the "Required Information" shall mean,
          collectively, a statement(s) from Manager: (1) that the
          Management Agreement has not been modified and is in full
          force and effect (or, if there have been modifications, that
          the same is in full force and effect as modified and
          specifying the modifications); and (2) whether, to the best
          knowledge of the signatory of such statement, any default
          exists, including any Event of Default (as defined in the
          Management Agreement), and if so, specifying each default of
          which the signatory may have knowledge.

          (v)  Notwithstanding any provision of this Agreement to the
          contrary, Purchaser's receipt of the Estoppels is not a
          condition to Purchaser's obligation to close and to acquire
          the Property (except to the extent expressly provided in
          Section 4.6(f) above) and the failure to obtain estoppel
          certificates from all or any of such parties shall not (A)
          constitute a default by Seller hereunder or (B) permit
          Purchaser to terminate this Agreement or obtain the return
          of the Earnest Money.

     (d)  During the period commencing on the expiration of the
     Inspection Period and ending on the Closing Date, subject to
     any express provision of this Agreement to the contrary,
     Seller shall not, without Purchaser's prior written consent
     (not to be unreasonably withheld or delayed), (1) personally
     take the following actions, or, (2) where it has the right
     to consent, and subject to any restraints arising under or
     in connection with the Management Agreement, consent to
     Manager taking the actions described below.  Notwithstanding
     any  provision of this Section 5.4(d) to the  contrary,
     Purchaser acknowledges and agrees that all of  Seller's
     covenants herein are expressly made subject to the terms and
     conditions of the Management Agreement and that Manager may
     have the right to unilaterally take the following actions
     without requesting Seller's consent pursuant to the terms of
     the Management Agreement:

          (i)  Voluntarily grant, create or assume any mortgage, lien,
          encumbrance, easement, covenant, condition, right-of-way or
          restriction upon the Real Property (other than liens and
          other claims which will be removed as of the Closing Date);

          (ii) Enter into any new contract with a term which will
          extend beyond the Closing Date (other than contracts for the
          replacement or resupply of Consumable Inventory or tangible
          Personal Property in the ordinary course of business in
          accordance with past practice); amend, modify, supplement or
          renew any other material Operating Agreement (other than in
          the ordinary course of business) in effect as of the
          Effective Date; or terminate any material Operating
          Agreement in effect on the date hereof unless the other
          party to such agreement is in default thereunder; or

          (iii)     Enter into any new lease or license with respect
          to the Real Property; terminate any Lease (unless the tenant
          thereunder has defaulted in the payment of rent for more
          than thirty (30) days or otherwise materially defaulted
          thereunder); enter into any modification of any of the terms
          of any Lease which modification (A) decreases the rent or
          any other payments thereunder in any material respect, (B)
          shortens or extends the current term of such Lease, or (C)
          substantially increases the obligations of the landlord or
          substantially decreases the obligations of the tenant under
          such Lease.

     (e)  Seller shall promptly advise Purchaser of any filed
     litigation,  arbitration proceedings or  administrative
     hearings concerning the Property of which Seller obtains
     actual knowledge.

     (f)  Unless the Management Agreement is not being terminated
     pursuant to Section 1.8 above, Seller shall deliver the
     notice of termination required under Section 4.4 of the
     Management Agreement not less than thirty (30) days prior to
     the Closing.

     (g)  Seller shall have given the notices required under any
     Plant Closing Laws as specified in Section 4.1(b) above.
     Notwithstanding the election made by Purchaser under Section
     1.9 above, Seller shall terminate all Hotel employees
     effective as of the end of their workshift on the Closing
     Date or midnight if their workshift extends past midnight.
     For purposes of liability under any Plant Closing Laws, the
     Closing Date is considered to be the "effective date of
     sale".

     (h)  Beginning one (1) week prior to the Closing Date,
     Seller shall use commercially reasonable efforts to cause
     Manager to provide to Purchaser, at no cost or expense to
     Purchaser, a meeting room suitable for Purchaser to conduct
     interviews and evaluate employment applications of those
     parties who may seek employment at the Property following
     Closing and Seller shall instruct Manager to reasonably
     cooperate with Purchaser's efforts to conduct such
     interviews.

5.5  Representations and Warranties of Purchaser.  Purchaser
hereby represents and warrants to Seller:

     (a)  ERISA.  Purchaser is not acquiring the Property with
     the assets of an employee benefit plan as defined in Section
     3(3) of ERISA.

     (b)  Organization and Authority.  Purchaser has been duly
     organized and is validly existing under the laws of Hawaii.
     Purchaser has the full right, power and authority to
     purchase the Property as provided in this Agreement and to
     carry out Purchaser's obligations hereunder, and all
     requisite action necessary to authorize Purchaser to enter
     into this Agreement and to carry out its obligations
     hereunder have been, or by the Closing will have been,
     taken.  The person signing this Agreement on behalf of
     Purchaser is authorized to do so, and this Agreement is
     enforceable against Purchaser in accordance with its terms,
     subject to bankruptcy, insolvency and similar laws.

     (c)  Pending Actions.  There is no action, suit,
     arbitration, unsatisfied order or judgment, government
     investigation or proceeding pending against Purchaser which,
     if adversely determined, could individually or in the
     aggregate materially interfere with the consummation of the
     transaction contemplated by this Agreement.

     (d)  Patriot Act Compliance.  Neither Purchaser nor any
     individual or entity having an interest in Purchaser is a
     person or entity described by Section 1 of the Executive
     Order (No. 13,224) Blocking Property and Prohibiting
     Transactions With Persons Who Commit, Threaten to Commit, or
     Support Terrorism, 66 Fed. Reg. 49,079 (September 24, 2001),
     and does not engage in any dealings or transactions, and is
     not otherwise associated, with any such persons or entities.

     (e)  Liquor License.  Purchaser has no knowledge of any
     reason that Purchaser, or its applicable designee, would not
     be approved by the Department of Liquor Control - County of
     Maui in a timely manner following its application for a
     temporary liquor license (or a transfer of Operating
     Company's liquor license) for the Hotel.

5.6  Survival of Purchaser's Representations and Warranties.
The representations and warranties of Purchaser set forth in
Section  5.5(a)  shall  survive  Closing  and  shall  be   a
continuing  representation and warranty without  limitation.
All  other representations and warranties of Purchaser shall
survive Closing for a period of one (1) year.

5.7  Covenants of Purchaser.

     (a)  In connection with its investigation of the Property
     during the Inspection Period, Purchaser may at its election
     (but  subject to the limitations of Section 3.1  above)
     inspect  the  Property  for the presence  of  Hazardous
     Substances (as defined below), and in such event  shall
     furnish  to  Seller copies of any reports  received  by
     Purchaser in connection with any such inspection.  Purchaser
     hereby assumes full responsibility for such inspections and
     irrevocably waives any claim against Seller and releases
     Seller from all liability arising from the presence  of
     Hazardous Substances on the Property.  Purchaser shall also
     furnish to Seller copies of any other reports received by
     Purchaser relating to any other inspections of the Property
     conducted  on  Purchaser's behalf, if  any  (including,
     specifically, without limitation, any reports analyzing
     compliance of the Property with the provisions  of  the
     Americans with Disabilities Act ("ADA"), 42 U.S.C. 12101,
     et  seq.,  if applicable).  As used herein,  "Hazardous
     Substances"  means  all hazardous or  toxic  materials,
     substances, pollutants, contaminants, or wastes currently
     identified  as a hazardous substance or  waste  in  the
     Comprehensive Environmental Response, Compensation  and
     Liability Act of 1980 (commonly known as "CERCLA"),  as
     amended, the Superfund Amendments and Reauthorization Act
     (commonly known as "SARA"), the Resource Conservation and
     Recovery  Act (commonly known as "RCRA"), or any  other
     federal, state or local legislation or ordinances applicable
     to the Property.  This Section 5.7(a) shall survive Closing.

     (b)  All baggage or other property of guests of the Hotel
     which has been checked with or left in the care of Seller
     and remains in Seller's care as of the Cutoff Time shall be
     inventoried and tagged jointly by Seller and Purchaser.
     Purchaser hereby agrees to defend, indemnify and hold
     harmless the Seller against any claims, losses or
     liabilities in connection with such baggage and property
     arising out of the acts or omissions of Purchaser from and
     after the Closing Date.  Seller hereby agrees to defend,
     indemnify and hold harmless Purchaser against all claims,
     losses and liabilities with respect to such baggage and
     property arising out of the acts or omissions of the Seller
     prior to the Closing Date.  This Section 5.7(b) shall
     survive Closing.

     (c)  As of the Closing Date, Seller shall deliver to
     Purchaser a list of all guests of the Hotel maintaining
     items in safe deposit boxes.  Purchaser hereby agrees to
     defend, indemnify and hold harmless the Seller against any
     claims, losses or liabilities in connection with such safe
     deposit boxes arising out of the acts or omissions of
     Purchaser from and after the Closing Date.  Seller hereby
     agrees to defend, indemnify and hold harmless Purchaser
     against all claims, losses and liabilities with respect to
     such safe deposit boxes arising out of the acts or omissions
     of the Seller prior to the Closing Date.  This Section
     5.7(c) shall survive Closing.

     (d)  Purchaser shall honor (and shall cause the Manager or
     any successor manager to honor) all reservations at the
     Hotel, or for any related conference, banquet, or meeting
     space or any other facilities, made through or in connection
     with the Hotel prior to the Cut-Off Time for periods on or
     after the date of Closing.  This Section 5.7(d) shall
     survive Closing.

     (e)  The Hotel is presently a member of the Kapalua Resort
     Association (the "Association").  Purchaser understands that
     from and after the Closing Date, Purchaser, as owner of the
     Hotel, shall become and remain a member of the Association
     with all obligations of membership including the obligation
     to make contributions to the Association.  Purchaser shall
     retain any votes as a member of the Association which are
     attributable to the Land (as the owner of the Land) and
     Purchaser (as the purchaser of the Hotel) shall receive and
     be entitled to exercise all votes attributable to the Hotel,
     if any.

     (f)  Purchaser acknowledges the existence of the Kapalua
     Marketing Association, a non-profit Hawaii corporation
     ("KMA").  Purchaser understands that from and after the
     Closing Date, Purchaser shall become and remain a member of
     KMA with respect to the Hotel and make its contribution to
     KMA.

     (g)  Purchaser and Seller agree that Seller's obligations as
     "Lessee" and Purchaser's rights as "Lessor" under Section 7
     of the Hotel Ground Lease with respect to a sale of the
     Property by Seller are hereby modified and supplemented by
     the following:

          (i)  As used herein, an "Eligible Termination Event" shall
          mean any right of Purchaser to terminate this Agreement,
          excluding only termination as a result of (A) a Seller
          default (subject to Seller's cure rights as provided in
          Section 6.3 below), (B) a failure of the condition precedent
          for Purchaser's benefit set forth in Section 4.6(d) above
          (following the expiration of the notice and cure period set
          forth in Section 4.8(b) above), or (C) a failure of the
          condition precedent for Purchaser's benefit set forth in
          Section 4.6(e) above, provided that (1) such failure is
          solely as a result of reasons not within Purchaser's
          control, (2) Purchaser has fully and timely complied with
          the requirements of Section 4.9 above, (3) Purchaser shall
          have extended the Outside Closing Date as permitted by
          Section 4.9(c) above and during such extension period
          continued to diligently and in good faith pursue approval of
          its liquor license application, and (4) such failure is not
          the result of any of the officers or directors of Purchaser
          (or any entity affiliated with Purchaser that is subject to
          the review of the Department of Liquor Control - County of
          Maui in connection with Purchaser's liquor license
          application) being deemed not "fit and proper" under
          applicable statutes governing issuance of liquor licenses by
          the Department of Liquor Control - County of Maui, as a
          result of their criminal history or otherwise.

          (ii) Notwithstanding anything in this Agreement to the
          contrary, concurrently with Purchaser's delivery of written
          notice of termination in connection with any Eligible
          Termination Event, Purchaser shall provide written notice to
          Seller (A) of a lower purchase price at which Purchaser
          would be willing to forego termination and proceed to close
          the purchase the Property (the "Continuation Price"), or (B)
          that Purchaser is unwilling to proceed to purchase the
          Property at any price (the "Rejection Notice").  Seller
          shall have the right, in its sole and absolute discretion to
          reject or accept the Continuation Price as a substitute for
          the Purchase Price by written notice delivered to Purchaser
          within five (5) days following receipt of Purchaser's
          Continuation Price notice (during which period the
          effectiveness of Purchaser's termination shall be tolled)
          and in the event Seller gives timely notice of acceptance of
          the Continuation Price in writing Purchaser's notice of
          termination shall be null and void and of no further force
          or effect and the Closing shall occur as scheduled without
          change to this Agreement or the obligations of the parties
          other than the Purchase Price being reduced to the
          Continuation Price.

          (iii) In the event that Purchaser terminates the
          Agreement in connection with any Eligible Termination Event,
          and has provided Seller with a Continuation Price, then
          Seller shall be free to sell the Hotel to any party at a
          price that is equal to or greater than the Continuation
          Price and on terms which are not materially more favorable
          to the purchaser than the terms of this Agreement, without
          being subject to the terms of Section 7 of Article XI of the
          Hotel Ground Lease or any other constraints on a sale under
          the terms of the Ground Leases.  In the event that,
          following a termination of this Agreement and the delivery
          of a Continuation Price under this subsection (g)(ii) above,
          Seller agrees to sell the Hotel at a price that is less than
          the Continuation Price or on terms and conditions materially
          more favorable to the purchaser than the terms of this
          Agreement, the provisions of Section 7 of Article XI of the
          Hotel Ground Lease shall govern such potential sale as
          applicable.

          (iv) In the event that (A) Purchaser terminates this
          Agreement for any Eligible Termination Event, and has
          provided Seller with a Rejection Notice or has failed to
          provide either a Rejection Notice or a Continuation Price
          concurrently with a termination notice, or (B) Seller
          terminates this Agreement following a breach by Purchaser
          (subject to Purchaser's cure rights as provided in Section
          6.3 below), then in any such event, Seller shall be free to
          sell the Hotel to any party on such terms and conditions as
          Seller shall deem appropriate in its sole discretion,
          without being subject to the terms of Section 7 of Article
          XI of the Hotel Ground Lease or any other constraints on a
          sale under the terms of the Ground Leases.

     This  Section  5.7(g) shall survive any termination  of
     this Agreement.

     (h)    Purchaser shall either: (1) rehire substantially all
     of the active employees at the Hotel as of Closing upon or
     immediately after Closing (but may terminate such employees
     as it deems appropriate following Closing), or (2) indemnify
     Seller against any claims, damages, costs and liabilities
     caused by Purchaser's failure to so rehire substantially all
     of the employees at the Hotel.  This Section 5.7(h) shall
     survive Closing.


                         ARTICLE VI
                           DEFAULT

6.1   Default by Purchaser.  If Purchaser commits a material
default under this Agreement (including, without limitation,
a  failure to purchase the Property, a failure to  make  the
closing  deliveries required by Section  4.3  above  or  the
breach of a representation or warranty under this Agreement),
Seller shall be entitled, as its sole remedy (without limiting
Seller's  rights  under Section 10.16 below),  to  terminate
this  Agreement and receive the Earnest Money as  liquidated
damages  for  the breach of this Agreement, it being  agreed
between the parties hereto that the actual damages to Seller
in the event of such breach are impractical to ascertain and
the  amount  of  the Earnest Money is a reasonable  estimate
thereof.   THEREFORE, BY PLACING THEIR INITIALS  BELOW,  THE
PARTIES  ACKNOWLEDGE  THAT  THE  DEPOSIT  AND  ANY  INTEREST
THEREON  HAS  BEEN  AGREED UPON, AFTER NEGOTIATION,  AS  THE
PARTIES'  REASONABLE  ESTIMATE OF SELLER'S  DAMAGES  AND  AS
SELLER'S  EXCLUSIVE REMEDY AGAINST PURCHASER, AT LAW  OR  IN
EQUITY,  IN  THE EVENT OF A DEFAULT UNDER THIS AGREEMENT  ON
THE  PART  OF PURCHASER.  THE PARTIES ACKNOWLEDGE  THAT  THE
PAYMENT  OF  SUCH LIQUIDATED DAMAGES IS NOT  INTENDED  AS  A
FORFEITURE   OR  PENALTY,  BUT  IS  INTENDED  TO  CONSTITUTE
LIQUIDATED DAMAGES TO SELLER.

          Initials: Seller              Purchaser

Nothing contained in this Section 6.1 shall limit or prevent
Seller from (a) terminating this Agreement and asserting any
claims  for  damages  for defaults by Purchaser  under  this
Agreement  that are not "material" as set forth  above,  (b)
asserting  any claims against Purchaser for attorneys'  fees
and  other  amounts under Section 10.16 below, (c) enforcing
any  indemnity obligation of Purchaser under this  Agreement
or   preclude  Seller  from  obtaining  a  damage  award  in
connection  therewith,  or (d) enforcing  Purchaser's  other
obligations  and liabilities which survive a termination  of
this Agreement.

6.2   Default by Seller.  In the event that Seller fails  to
consummate   this  Agreement  for  any  reason  other   than
Purchaser's  default  or the permitted termination  of  this
Agreement   by  Seller  or  Purchaser  as  herein  expressly
provided,  Purchaser shall be entitled, as its sole  remedy,
either (a) to receive the return of the Earnest Money, which
return shall operate to terminate this Agreement and release
Seller  from  any  and all liability hereunder,  or  (b)  to
enforce  specific  performance  of  Seller's  obligation  to
execute  the  documents required to convey the  Property  to
Purchaser, it being understood and agreed that the remedy of
specific  performance shall not be available to enforce  any
other  obligation of Seller hereunder.  Purchaser  expressly
waives  its rights to seek damages in the event of  Seller's
default  hereunder.   Purchaser  shall  be  deemed  to  have
elected  to  terminate this Agreement and receive  back  the
Earnest  Money if Purchaser fails to file suit for  specific
performance against Seller in a court having jurisdiction in
the county and state in which the Property is located, on or
before  thirty  (30)  days following  the  date  upon  which
Closing  was  to  have  occurred.  Notwithstanding  anything
herein  to the contrary, in the event that Seller sells  the
Hotel  in  violation of the provisions of Section 5.7(g)(ii)
above,  the provisions of this Section 6.2 and Section  10.8
below  shall not limit Purchaser's rights and remedies under
the  Hotel  Ground  Lease in connection with  a  default  by
Seller  under  Section 7 of Article XI of the  Hotel  Ground
Lease (as such Section 7 has been modified by Section 5.7(g)
of this Agreement).

6.3  Right to Cure Defaults.  Notwithstanding anything to
the contrary in this Agreement, (i) Seller shall not have
the right to exercise its right to terminate this Agreement
under Section 6.1 for a Purchaser default, and (ii)
Purchaser shall not have the right to exercise its right to
terminate this Agreement under Section 6.2 for a Seller
default, unless the non-defaulting party has provided
written notice to the defaulting party specifying in
reasonable detail the nature of the default, and the
defaulting party fails to completely cure the default within
three (3) business days after delivery of such notice.
Notwithstanding the foregoing, neither Seller nor Purchaser
shall be entitled to the cure periods set forth in this
Section 6.3 in connection with a failure to deliver the
items required under, as to Seller, Section 4.2(a) - (p),
and as to Purchaser, Section 4.3(a) - (g).


                         ARTICLE VII
                        RISK OF LOSS

7.1   Minor Damage.  In the event of loss or damage  to  the
Property  or  any portion thereof which is not  "major"  (as
hereinafter  defined), this Agreement shall remain  in  full
force  and  effect  provided Seller performs  any  necessary
repairs or, at Seller's option, assigns to Purchaser all  of
Seller's  right,  title  and  interest  to  any  claims  and
proceeds  Seller  may  have with  respect  to  any  casualty
insurance  policies or condemnation awards relating  to  the
premises  in question.  In the event that Seller  elects  to
perform   repairs  upon  the  Property,  Seller  shall   use
reasonable efforts to complete such repairs promptly and the
date of Closing shall be extended a reasonable time in order
to  allow  for  the completion of such repairs.   If  Seller
elects to assign a casualty claim to Purchaser, the Purchase
Price  shall be reduced by an amount equal to the deductible
amount under Seller's insurance policy.  Upon Closing,  full
risk  of  loss  with respect to the Property shall  pass  to
Purchaser.

7.2  Major Damage.  In the event of a "major" loss or
damage, Purchaser may terminate this Agreement by written
notice to Seller and Escrow Agent, in which event the
Earnest Money shall be returned to Purchaser.  If Purchaser
fails to deliver notice of termination of this Agreement
within ten (10) days after Seller sends Purchaser written
notice of the occurrence of major loss or damage, Purchaser
shall be deemed to have elected to proceed with Closing, in
which event Seller shall, at Seller's option, either
(a) perform any necessary repairs, or (b) assign to
Purchaser all of Seller's right, title and interest to any
claims and proceeds Seller may have with respect to any
casualty insurance policies or condemnation awards relating
to the premises in question.  In the event that Seller
elects to perform repairs upon the Property, Seller shall
use reasonable efforts to complete such repairs promptly and
the date of Closing shall be extended a reasonable time in
order to allow for the completion of such repairs.  If
Seller elects to assign a casualty claim to Purchaser, the
Purchase Price shall be reduced by an amount equal to the
deductible amount under Seller's insurance policy.  Upon
Closing, full risk of loss with respect to the Property
shall pass to Purchaser.

7.3  Definition of "Major" Loss or Damage.  For purposes of
Sections 7.1 and 7.2, "major" loss or damage refers to the
following:  (i) loss or damage to the Property or any
portion thereof such that the cost of repairing or restoring
the premises in question to a condition substantially
identical to that of the premises in question prior to the
event of damage would be, in the opinion of an architect
selected by Seller and reasonably approved by Purchaser,
equal to or greater than Three Million Dollars ($3,000,000),
and (ii) any loss due to a condemnation which permanently
and materially impairs the current use of the Property.  If
Purchaser does not give notice to Seller of Purchaser's
reasons for disapproving an architect within
five (5) business days after receipt of notice of the
proposed architect, Purchaser shall be deemed to have
approved the architect selected by Seller.


                        ARTICLE VIII
                         COMMISSIONS

8.1   Brokerage Commissions.  Each party agrees that  should
any claim be made for brokerage commissions or finder's fees
by any broker or finder through or on account of any acts of
said party or its representatives, said party will indemnify
and  hold the other party free and harmless from and against
any  and  all loss, liability, cost, damage and  expense  in
connection  therewith.   The provisions  of  this  paragraph
shall  survive  Closing  or  earlier  termination  of   this
Agreement.


                         ARTICLE IX
                   DISCLAIMERS AND WAIVERS

9.1    No   Reliance   on  Documents.    Seller   makes   no
representation  or  warranty as to the  truth,  accuracy  or
completeness of any materials, data or information delivered
by  Seller  to Purchaser in connection with the  transaction
contemplated  hereby including.  Purchaser acknowledges  and
agrees that all materials, data and information delivered by
Seller  to  Purchaser  in connection  with  the  transaction
contemplated   hereby  are  provided  to  Purchaser   as   a
convenience  only and that any reliance on or  use  of  such
materials, data or information by Purchaser shall be at  the
sole risk of Purchaser, except as otherwise expressly stated
herein.   Without limiting the generality of  the  foregoing
provisions, Purchaser acknowledges and agrees that  (a)  any
environmental or other report with respect to  the  Property
which  is  delivered  by Seller to Purchaser  shall  be  for
general informational purposes only, (b) Purchaser shall not
have  any  right  to  rely on any such report  delivered  by
Seller  to  Purchaser,  but rather  will  rely  on  its  own
inspections  and  investigations of  the  Property  and  any
reports commissioned by Purchaser with respect thereto,  and
(c)  neither Seller, any affiliate of Seller nor the  person
or entity which prepared any such report delivered by Seller
to  Purchaser shall have any liability to Purchaser for  any
inaccuracy in or omission from any such report.

9.2  DISCLAIMERS.  EXCEPT AS EXPRESSLY SET FORTH IN SECTION
5.1 ABOVE, IT IS UNDERSTOOD AND AGREED THAT SELLER IS NOT
MAKING AND HAS NOT AT ANY TIME MADE ANY WARRANTIES OR
REPRESENTATIONS OF ANY KIND OR CHARACTER, EXPRESSED OR
IMPLIED, WITH RESPECT TO THE PROPERTY, INCLUDING, BUT NOT
LIMITED TO, ANY WARRANTIES OR REPRESENTATIONS AS TO
HABITABILITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, TITLE, ZONING, TAX CONSEQUENCES, LATENT OR PATENT
PHYSICAL OR ENVIRONMENTAL CONDITION, UTILITIES, OPERATING
HISTORY OR PROJECTIONS, VALUATION, GOVERNMENTAL APPROVALS,
THE COMPLIANCE OF THE PROPERTY WITH GOVERNMENTAL LAWS, THE
TRUTH, ACCURACY OR COMPLETENESS OF THE PROPERTY DOCUMENTS OR
ANY OTHER INFORMATION PROVIDED BY OR ON BEHALF OF SELLER TO
PURCHASER, OR ANY OTHER MATTER OR THING REGARDING THE
PROPERTY.  PURCHASER ACKNOWLEDGES AND AGREES THAT UPON
CLOSING SELLER SHALL SELL AND CONVEY TO PURCHASER AND
PURCHASER SHALL ACCEPT THE PROPERTY "AS IS, WHERE IS, WITH
ALL FAULTS", SUBJECT ONLY TO SELLER'S REPRESENTATIONS AND
WARRANTIES AS EXPRESSLY SET FORTH IN SECTION 5.1 ABOVE AND
SELLER'S EXPRESS COVENANTS AND OBLIGATIONS CONTAINED HEREIN.
EXCEPT AS EXPRESSLY SET FORTH IN SECTION 5.1 ABOVE AND
SELLER'S EXPRESS COVENANTS AND OBLIGATIONS CONTAINED HEREIN,
PURCHASER HAS NOT RELIED AND WILL NOT RELY ON, AND SELLER IS
NOT LIABLE FOR OR BOUND BY, ANY EXPRESSED OR IMPLIED
WARRANTIES, GUARANTIES, STATEMENTS, REPRESENTATIONS OR
INFORMATION PERTAINING TO THE PROPERTY OR RELATING THERETO
(INCLUDING SPECIFICALLY, WITHOUT LIMITATION, PROPERTY
INFORMATION PACKAGES DISTRIBUTED WITH RESPECT TO THE
PROPERTY) MADE OR FURNISHED BY SELLER, THE MANAGER OF THE
PROPERTY, OR ANY REAL ESTATE BROKER OR AGENT REPRESENTING OR
PURPORTING TO REPRESENT SELLER, TO WHOMEVER MADE OR GIVEN,
DIRECTLY OR INDIRECTLY, ORALLY OR IN WRITING, UNLESS
SPECIFICALLY SET FORTH IN THIS AGREEMENT.  AT CLOSING,
PURCHASER SHALL HAVE CONDUCTED SUCH INVESTIGATIONS OF THE
PROPERTY, INCLUDING BUT NOT LIMITED TO, THE PHYSICAL AND
ENVIRONMENTAL CONDITIONS THEREOF, AS PURCHASER DEEMS
NECESSARY TO SATISFY ITSELF AS TO THE CONDITION OF THE
PROPERTY AND THE EXISTENCE OR NONEXISTENCE OR CURATIVE
ACTION TO BE TAKEN WITH RESPECT TO ANY HAZARDOUS OR TOXIC
SUBSTANCES ON OR DISCHARGED FROM THE PROPERTY, AND WILL RELY
SOLELY UPON SAME AND NOT UPON ANY INFORMATION PROVIDED BY OR
ON BEHALF OF SELLER OR ITS AGENTS OR EMPLOYEES WITH RESPECT
THERETO, OTHER THAN SUCH REPRESENTATIONS, WARRANTIES AND
COVENANTS OF SELLER AS ARE EXPRESSLY SET FORTH IN THIS
AGREEMENT.  SUBJECT ONLY TO SELLER'S EXPRESS REPRESENTATIONS
AND WARRANTIES IN SECTION 5.1 ABOVE AND SELLER'S EXPRESS
COVENANTS AND OBLIGATIONS CONTAINED HEREIN, UPON CLOSING,
PURCHASER SHALL ASSUME THE RISK THAT ADVERSE MATTERS,
INCLUDING BUT NOT LIMITED TO, CONSTRUCTION DEFECTS AND
ADVERSE PHYSICAL AND ENVIRONMENTAL CONDITIONS, MAY NOT HAVE
BEEN REVEALED BY PURCHASER'S INVESTIGATIONS, AND SUBJECT
ONLY TO SELLER'S REPRESENTATIONS AND WARRANTIES AS EXPRESSLY
SET FORTH IN SECTION 5.1 ABOVE AND SELLER'S EXPRESS
COVENANTS AND OBLIGATIONS CONTAINED HEREIN, PURCHASER, UPON
CLOSING, SHALL BE DEEMED TO HAVE WAIVED, RELINQUISHED AND
RELEASED SELLER (AND SELLER'S OFFICERS, DIRECTORS,
SHAREHOLDERS, EMPLOYEES AND AGENTS) FROM AND AGAINST ANY AND
ALL CLAIMS, DEMANDS, CAUSES OF ACTION (INCLUDING CAUSES OF
ACTION IN TORT), LOSSES, DAMAGES, LIABILITIES, COSTS AND
EXPENSES (INCLUDING ATTORNEYS' FEES AND COURT COSTS) OF ANY
AND EVERY KIND OR CHARACTER, KNOWN OR UNKNOWN, WHICH
PURCHASER MIGHT HAVE ASSERTED OR ALLEGED AGAINST SELLER (AND
SELLER'S OFFICERS, DIRECTORS, SHAREHOLDERS, EMPLOYEES AND
AGENTS) AT ANY TIME BY REASON OF OR ARISING OUT OF ANY
LATENT OR PATENT CONSTRUCTION DEFECTS OR PHYSICAL
CONDITIONS, VIOLATIONS OF ANY APPLICABLE LAWS (INCLUDING,
WITHOUT LIMITATION, ANY ENVIRONMENTAL LAWS) AND ANY AND ALL
OTHER ACTS, OMISSIONS, EVENTS, CIRCUMSTANCES OR MATTERS
REGARDING THE PROPERTY.  SUBJECT ONLY TO SELLER'S LIABILITY
FOR A BREACH OF ANY EXPRESS REPRESENTATIONS AND WARRANTIES
IN SECTION 5.1 ABOVE, PURCHASER AGREES THAT, AS BETWEEN
SELLER AND PURCHASER (BUT NOT AS AN INDEMNITY AGAINST THIRD
PARTY CLAIMS), SHOULD ANY CLEANUP, REMEDIATION OR REMOVAL OF
HAZARDOUS SUBSTANCES OR OTHER ENVIRONMENTAL CONDITIONS ON
THE PROPERTY BE REQUIRED AFTER THE DATE OF CLOSING, SUCH
CLEAN-UP, REMOVAL OR REMEDIATION SHALL BE THE RESPONSIBILITY
OF AND SHALL BE PERFORMED AT THE SOLE COST AND EXPENSE OF
PURCHASER.
     The  waivers  and releases set forth in Section  5.7(a)
and in the immediately preceding paragraph include claims of
which Purchaser is presently unaware or which Purchaser does
not presently suspect to exist which, if known by Purchaser,
would  materially affect Purchaser's waiver  or  release  of
Seller.

     Notwithstanding  the foregoing, in no event  shall  the
provisions  of  this  Section 9.2 limit the  indemnification
obligations set forth in Section 1.13 above.

9.3  Repairs, Reserves, and Capital Expenditures.  Purchaser
acknowledges that and agrees that (a) Seller shall  have  no
obligation  to make any repairs, replacements,  improvements
or  alterations  to  the Property or  to  expend  any  funds
therefore, including, without limitation, any reserves  that
may be held for such purpose, and (b) Purchaser shall not be
entitled  to a credit to the Purchaser Price at  Closing  in
the  event  capital expenditures actually made at the  Hotel
for 2004 are less than the budgeted amount as of the date of
the Closing.

9.4  Effect and Survival of Disclaimers.  Seller and
Purchaser agree that the provisions of this Article IX shall
survive Closing.


                          ARTICLE X
                        MISCELLANEOUS

10.1  Confidentiality.  Prior to Closing, except as  may  be
required  by law (including any SEC requirements), (a)  each
of   Seller   and   Purchaser   agrees   to   maintain   the
confidentiality  of  the  terms  and  provisions   of   this
Agreement   and  (b)  Purchaser  agrees  to   maintain   the
confidentiality of all information respecting  the  Property
(including  the  terms  and provisions  of  this  Agreement)
received from Seller, Seller's employees or agents  or  from
Purchaser's  inspections; provided, however, that  Purchaser
shall  be  permitted  to disclose such  information  to  its
employees,  consultants, attorneys and/or agents,  partners,
lenders,  and  others  retained  in  connection  with   this
transaction  provided such third parties agree to  similarly
maintain the confidentiality of such information.  After the
Closing, neither Seller nor Purchaser shall make any general
public  statements or news releases, or any statements  that
may  become  public, regarding this transaction except  with
the  prior written consent of the other party, such  consent
not to be unreasonably withheld or delayed.  Purchaser's and
Seller's  obligations  under  this  Section  shall   survive
Closing or the earlier termination of this Agreement.

10.2 Intentionally Omitted.

10.3 Assignment.  Except for an assignment to a partnership,
limited liability company or other entity which is directly
or indirectly controlled by Purchaser, Purchaser may not
assign its rights under this Agreement without first
obtaining Seller's written approval which may be given or
withheld in Seller's sole discretion.  Any assignment by
Purchaser of all or part of this Agreement shall not relieve
Purchaser from liability for a breach of Purchaser's
obligations under this Agreement. Without limiting the
foregoing, in no event shall Purchaser assign this Agreement
to any assignee which, in the reasonable judgment of Seller,
will cause the transaction contemplated hereby or any party
thereto to violate the requirements of ERISA.

10.4 Notices.  Any notice pursuant to this Agreement shall
be given in writing by (a) personal delivery, or
(b) reputable overnight delivery service with proof of
delivery, or (c) United States Mail, postage prepaid,
registered or certified mail, return receipt requested, or
(d) legible facsimile transmission sent to the intended
addressee at the address set forth below, or to such other
address or to the attention of such other person as the
addressee shall have designated by written notice sent in
accordance herewith, and shall be deemed to have been given
either at the time of personal delivery, or, in the case of
expedited delivery service or mail, as of the date of first
attempted delivery at the address and in the manner provided
herein, or, in the case of facsimile transmission, as of the
date of the facsimile transmission provided that an original
of such facsimile is also sent to the intended addressee by
means described in clauses (a), (b) or (c) above.  Unless
changed in accordance with the preceding sentence, the
addresses for notices given pursuant to this Agreement shall
be as follows:

If to Seller:

Yarmouth Capital Partners LP II
c/o Morgan Stanley
3424 Peachtree Rd., Suite 800
Atlanta, GA  30326
Attention: Bo Reddic
Facsimile No.: (404) 848-8902

With a copy to:

Morgan Stanley US RE Investing Division
440 South LaSalle Street
One Financial Place, Floor 37
Chicago, IL 60605
Facsimile No.: (312) 706-4876
Attention: Jill Johnson

With a copy to:

Paul, Hastings, Janofsky & Walker LLP
515 South Flower Street, 25th Floor
Los Angeles, California 90071
Attention: Alan Weakland, Esq.
Facsimile no. (213) 996-3241

If to Purchaser:

Maui Land & Pineapple Company, Inc.
P.O. Box 187
Kahului, Maui, Hawaii 96732
Attention: David Cole
Facsimile no. (808) 871-0953

With a copy to:

Teel, Palmer & Roeper
ICW Plaza at Torrey Reserve
11455 El Camino Real, Suite 300
San Diego, California 92130
Attention: Dean E. Roeper, Esq.
Facsimile no. (858) 794-2909

10.5   Modifications.   This  Agreement  cannot  be  changed
orally,  and  no executory agreement shall be  effective  to
waive,  change, modify or discharge it in whole or  in  part
unless  such executory agreement is in writing and is signed
by  the  parties  against whom enforcement  of  any  waiver,
change, modification or discharge is sought.

10.6 Calculation of Time Periods; Time is of the
Essence.  Unless otherwise specified, in computing any
period of time described in this Agreement, the day of the
act or event after which the designated period of time
begins to run is not to be included and the last day of the
period so computed is to be included, unless such last day
is a Saturday, Sunday or legal holiday under the laws of the
State in which the Property is located, in which event the
period shall run until the end of the next day which is
neither a Saturday, Sunday or legal holiday.  The final day
of any such period shall be deemed to end at 5 p.m., local
time where the Real Property is located.  Time is of the
essence of this Agreement.

10.7 Successors and Assigns.  The terms and provisions of
this Agreement are to apply to and bind the permitted
successors and assigns of the parties hereto.

10.8 Entire Agreement.  This Agreement, including the
Exhibits, the Schedules and any confidentiality agreement
executed by Purchaser, the Hotel Ground Lease and the
Restaurant Ground Lease (each subject to limitations on
liability and releases set forth herein) contain the entire
agreement between the parties pertaining to the subject
matter hereof and fully supersedes all prior written or oral
agreements and understandings between the parties pertaining
to such subject matter.

10.9 Further Assurances.  Each party agrees that it will
without further consideration execute and deliver such other
documents and take such other action, whether prior or
subsequent to Closing, as may be reasonably requested by the
other party to consummate more effectively the purposes or
subject matter of this Agreement.  Without limiting the
generality of the foregoing, Purchaser shall, if requested
by Seller, execute acknowledgments of receipt with respect
to any materials delivered by Seller to Purchaser with
respect to the Property.  The provisions of this Section
10.9 shall survive Closing.

10.10     Counterparts; Facsimile Signatures.  This
Agreement may be executed in counterparts, and all such
executed counterparts shall constitute the same agreement.
It shall be necessary to account for only one such
counterpart in proving this Agreement.  In order to expedite
the transaction contemplated herein, telecopied or facsimile
signatures may be used in place of original signatures on
this Agreement.  Seller and Purchaser intend to be bound by
the signatures on the telecopied document, are aware that
the other party will rely on the telecopied signatures, and
hereby waive any defenses to the enforcement of the terms of
this Agreement based on the form of signature.

10.11     Severability.  If any provision of this Agreement
is determined by a court of competent jurisdiction to be
invalid or unenforceable, the remainder of this Agreement
shall nonetheless remain in full force and effect.

10.12     Applicable Law.  THIS AGREEMENT IS PERFORMABLE IN
THE STATE IN WHICH THE LAND IS LOCATED AND SHALL IN ALL
RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE SUBSTANTIVE FEDERAL LAWS OF THE UNITED STATES AND THE
LAWS OF  SUCH STATE.  SELLER AND PURCHASER HEREBY
IRREVOCABLY SUBMIT TO THE JURISDICTION OF ANY STATE OR
FEDERAL COURT SITTING IN THE STATE IN WHICH THE LAND IS
LOCATED IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT AND HEREBY IRREVOCABLY AGREE THAT
ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING SHALL BE
HEARD AND DETERMINED IN A STATE OR FEDERAL COURT SITTING IN
THE STATE IN WHICH THE LAND IS LOCATED.  PURCHASER AND
SELLER AGREE THAT THE PROVISIONS OF THIS SECTION 10.12 SHALL
SURVIVE THE CLOSING OF THE TRANSACTION CONTEMPLATED BY THIS
AGREEMENT.

10.13     No Third Party Beneficiary.  The provisions of
this Agreement and of the documents to be executed and
delivered at Closing are and will be for the benefit of
Seller and Purchaser only and are not for the benefit of any
third party, and accordingly, no third party shall have the
right to enforce the provisions of this Agreement or of the
documents to be executed and delivered at Closing.

10.14     Exhibits and Schedules.  The following schedules
or exhibits attached hereto shall be deemed to be an
integral part of this Agreement:

     Exhibit A               -  Legal Description of the
                                Leasehold Land (Hotel)
     Exhibit B-1             -  Hotel Ground Lease Assignment
     Exhibit B-2             -  Restaurant Ground Lease Assignment
     Exhibit C               -  Bill of Sale
     Exhibit D-1             -  Assignment and Assumption of
                                Operating Agreements and Intangibles
     Exhibit D-2             -  Assignment and Assumption of
                                Supplemental Agreement
     Exhibit D-3             -  Assignment and Assumption of
                                Reciprocal Use Agreement
     Exhibit E               -  Assignment and Assumption of Leases
     Exhibit F               -  FIRPTA/HARPTA Certificate
     Exhibit G               -  Designation Agreement
     Exhibit H-1             -  Broad Form Estoppel
     Exhibit H-2             -  Form of Tenant Estoppel
     Exhibit H-3             -  Alternate Form of Manager Estoppel
     Exhibit I               -  Form of Release for Ground Leases
     Schedule 1.1(h)         -  List of Leases
     Schedule 3.1            -  Potentially Invasive
                                Testing
     Schedule 3.2            -  Property Reports
     Schedule 4.4(b)(xvii)   -  Gift Certificates/Vouchers
     Schedule  5.2(g)        -  List of Specific Operating
                                Agreements

10.15     Captions.  The section headings appearing in  this
Agreement are for convenience of reference only and are  not
intended,  to any extent and for any purpose,  to  limit  or
define the text of any section or any subsection hereof.

10.16     Construction.  The parties acknowledge that the
parties and their counsel have reviewed and revised this
Agreement and that the normal rule of construction to the
effect that any ambiguities are to be resolved against the
drafting party shall not be employed in the interpretation
of this Agreement or any exhibits or amendments hereto.
Singular words shall connote the plural as well as the
singular, and plural words shall connote the singular as
well as the plural, and the masculine shall include the
feminine and the neuter, as the context may require.

10.17     Termination of Agreement.  It is understood and
agreed that if either Purchaser or Seller terminates this
Agreement pursuant to a right of termination granted
hereunder, such termination shall operate to relieve Seller
and Purchaser from all obligations under this Agreement,
except for such obligations as are specifically stated
herein to survive the termination of this Agreement.

10.18     Attorneys Fees.  If any action or proceeding is
commenced by either party to enforce their rights under this
Agreement or to collect damages as a result of the breach of
any of the provisions of this Agreement, the prevailing
party in such action or proceeding, including any
bankruptcy, insolvency or appellate proceedings, shall be
entitled to recover all reasonable costs and expenses,
including, without limitation, reasonable attorneys' fees
and court costs, in addition to any other relief awarded by
the court.

10.19     Waiver of Jury Trial.  Seller and Purchaser, to
the extent they may legally do so, hereby expressly waive
any right to trial by jury of any claim, demand, action,
cause of action, or proceeding arising under or with respect
to this Agreement, or in any way connected with, or related
to, or incidental to, the dealings of the parties hereto
with respect to this Agreement or the transactions related
hereto or thereto, in each case whether now existing or
hereafter arising, and irrespective of whether sounding in
contract, tort, or otherwise.  To the extent they may
legally do so, Seller and Purchaser hereby agree that any
such claim, demand, action, cause of action, or proceeding
shall be decided by a court trial without a jury and that
any party hereto may file an original counterpart or a copy
of this Section with any court as written evidence of the
consent of the other party or parties hereto to waiver of
its or their right to trial by jury.

10.20     No Waiver.  Failure of either party at any time to
require performance of any provision of this Agreement shall
not limit the party's right to enforce the provision.
Waiver of any breach of any provision shall not be a waiver
of any succeeding breach of the provision or a waiver of the
provision itself or any other provision.

10.21     No Reservation of Property.  The preparation
and/or delivery of unsigned drafts of this Agreement shall
not create any legally binding rights in the Property and/or
obligations of the parties, and Purchaser and Seller
acknowledge that this Agreement shall be of no effect until
it is duly executed by both Purchaser and Seller.  Purchaser
understands and agrees that Seller shall have the right to
continue to market the Property and/or to negotiate with
other potential purchasers of the Property until the
expiration of the Inspection Period and the satisfaction or
waiver in writing of all conditions to the obligations of
Purchaser under this Agreement; provided, however, that in
the event that Seller enters into a contract for the sale of
the Property during such time period, the rights of the
purchaser thereunder shall be subject to Purchaser's rights
under this Agreement.

10.22     No Recordation. Purchaser shall not record this
Agreement, nor any memorandum or other notice of this
Agreement, in any public records.

10.23     Liability under Ground Lease Assignment. Purchaser
agrees that if Purchaser has any right or claim against
Seller pursuant to any warranty of title in the Hotel Ground
Lease Assignment or the Restaurant Ground lease Assignment
or in this Agreement with respect to warranties of title in
the Hotel Ground Lease Assignment or the Restaurant Ground
lease Assignment, if any, Purchaser shall exhaust all of its
rights and remedies against the Title Company pursuant to
the Title Policy prior to bringing any claim or action
against Seller in respect of such warranties of title.  The
provisions of this Section 10.23 shall survive Closing.

10.24     Like-Kind Exchange. Notwithstanding anything to
the contrary in this Agreement, Purchaser acknowledges and
agrees that Seller shall have the right at Closing, in lieu
of receiving the Purchase Price for the sale of the
Property, to exchange the Property (the "Tax-Free Exchange")
in a transaction intended to qualify as a tax-free exchange
under Section 1031 of the Internal Revenue Code of 1986, as
amended from time to time, and any regulations, rulings and
guidance issued by the Internal Revenue Service
(collectively, the "Code").  If Seller elects to effect a
Tax-Free Exchange pursuant to this Section 10.24, Seller
shall provide written notice to Purchaser prior to Closing,
in which case Seller shall enter into an exchange agreement
and other exchange documents with a "qualified intermediary"
(as defined in Treas. Reg.  1.1031(k)-1(g)(4) of the Code)
(the "Exchange Party"), pursuant to which Seller shall
assign all of its right, title and interest under this
Agreement to the Exchange Party.  Purchaser shall execute
and deliver such documents as may be required to complete
the transactions contemplated by the Tax-Free Exchange which
are in form and substance reasonably acceptable to
Purchaser, and otherwise cooperate with Seller in all
reasonable respects to effect the Tax-Free Exchange.
Purchaser agrees that if Seller elects to effect a Tax-Free
Exchange pursuant to this Section 10.24, at Closing,
Purchaser shall pay the Purchase Price to the Exchange Party
and direct Escrow Agent to disburse the Earnest Money to the
Exchange Party.  Notwithstanding the foregoing in this
Section 10.24, the Tax-Free Exchange shall not diminish
Purchaser's rights, nor increase Purchaser's liabilities or
obligations, under this Agreement.  Seller shall pay for all
fees, costs and expenses in connection with the Tax-Free
Exchange.

                  [SIGNATURE PAGE FOLLOWS]


     IN  WITNESS  WHEREOF,  the  parties  hereto  have  duly
executed this Agreement as of the Effective Date.

SELLER:

YCP KAPALUA L.P.,
a Delaware limited partnership

By:  YCP Kapalua G.P. Inc.,
     a Delaware corporation
     Its General Partner

        By:   Illegible
        Its:  Vice President

YCP KAPALUA OPERATOR, INC.,
a Delaware corporation

By:     /S/ JILL L. JOHNSON
Its:    Vice President


PURCHASER:

MAUI LAND & PINEAPPLE COMPANY, INC.,
a Hawaii corporation


By:     /S/ DAVID C. COLE
Name:       David C. Cole
Its:        President



By:     /S/ PAUL J. MEYER
Name:       Paul J. Meyer
Its:    Executive Vice President/Finance