<PAGE>
 

Exhibit 10.35


           PURCHASE MONEY LEASEHOLD MORTGAGE AND SECURITY AGREEMENT
           --------------------------------------------------------

          THIS LEASEHOLD MORTGAGE AND SECURITY AGREEMENT ("Mortgage") made this
20 day of February 1992, between LUCAYA BEACH HOTEL CORPORATION, a Florida
corporation, ("Mortgagor"), and DEL-AIRE MANAGEMENT CO., INC., a Florida
corporation, having an office at 4541 White Cedar Lane, Delray Beach, Florida
("Mortgagee")


        1.  Mortgagor has purchased  the leasehold interest described herein
from the Mortgagee and executed the promissory note in the face amount of One
Million Two Hundred Thousand and 00/100 Dollars ($1,200,000.00) ("the Note")
secured by this Mortgage as  part of the purchase price for said leasehold
interest.

        2. Mortgagor desires to execute the within Mortgage and Security
Agreement and grant the security interests provided herein for the purpose of
securing the payment and performance obligations of the Mortgagor under the
Note.

        NOW THIS LEASEHOLD MORTGAGE AND SECURITY AGREEMENT WITNESSETH, that in
consideration of the aforesaid principal sum of the Note and as further security
for the payment under the Note with interest and aforesaid together with all
other sums recoverable by Mortgagee under the terms of the Note, this Mortgage
and Security Agreement, together with all existing and future liabilities of
Mortgagor to Mortgagee (said indebtedness and interest and such other sums and
liabilities are hereinafter collectively referred to as the "Aggregate Debt U),
and as security for the due and timely performance by Mortgagor of all of the
other provisions of the Note, and intending to be legally bound hereby,
Mortgagor hereby GRANTS, BARGAINS, SELLS, CONVEYS, ASSIGNS, TRANSFERS, RELEASES,
PLEDGES and MORTGAGES to Mortgagee its leasehold interest in that certain parcel
of real property known as The Lucaya Beach Hotel located in Broward County,
Florida, as more fully described in Exhibit "A" attached hereto and made a part
hereof (the "Real Property"), held pursuant to that certain lease agreement
dated February 10, 1965 (the "LEASE") between Lighthouse Point Construction
Corp. (Mortgagor', predecessor-in-interest), as lessee, and Nancy H. Newell and
Jane H. Tubbs, as lessor ("Leasehold Estate");

        TOGETHER WITH all right, title and interest of Mortgagor in and to the
following property located at the Real Property (the "Location") now owned or
hereafter acquired by Mortgagor, or its successors or assigns, or in which
Mortgagor, or its successors or assigns, now or hereafter   has an interest
(provided, however,  that building plans and specifications,  survey,
appliances,  fixtures,  equipment,  furniture  and furnishings appurtenant to
that certain hotel currently operated as the "Oceanside Hotel" which hotel is
located on land adjacent to the land described On Exhibit "A" hereto shall not
be encumbered hereby) which Mortgagor hereby assigns to Mortgagee  until the
Aggregate Debt is paid:

  (a) All buildings and other improvements now or hereafter located on the Real
Property ("Improvements");

  (b) All streets, lanes, alleys, passages, ways, water courses, easements,
rights, liberties, privileges, tenements, hereditaments and appurtenances
whatsoever belonging to the Real Property or in any way made appurtenant to the
Real Property hereafter, and the reversions and remainder, with respect thereto
("Appurtenances");

  (c) All machinery, equipment, furniture and fixtures, office materials and
supplies, spare parts, and other tangible personal property of every kind and
description, now owned or
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hereafter acquired,  including, without limitation, every item which is or may
be necessary or convenient in relation to the operation of the hotel located at
the Location (the "Hotel") and with respect to all of the foregoing, all parts,
substitutions, improvements, accessories, attachments and additions thereto and
therefor ("Equipment")

  (d)  All agreements of governmental authorities relating to such Hotel and
other licenses, permit agreements and rights under governmental ordinances
agreements granting access rights 55 to leases, notes receivable purchased by
Mortgagor with the proceeds of loans advanced by the Mortgagee, and contract
rights to the extent they relate to the Hotel, in connection with the conduct of
the business and/or operation of the Hotel ("Intangibles").

  (e) All building materials, building machinery and building equipment
delivered on site to the Location during the course of, or in connection with,
the construction of, or reconstruction of or remodeling of any building and
improvements from time to time ("Building Equipment");

  (f) All goods and inventory, located at the Locations now owned or hereafter
acquired and all additions and accessions thereto, and all books, records,
computer software and logs relating to and/or appropriate to the conduct of the
business at the Hotel and/or the operations of the Hotel, provided that
Mortgagor shall be entitled at its expense to make and keep copies of same
("Goods");

  (g) All awards or payments, including interest thereon, which may be made with
respect to the Location and any improvements, whether from the exercise of the
right of eminent domain (including any transfer made in lieu of the exercise of
said right), or for any other injury to or decrease in the value of the real
estate upon which the Hotel is located or any improvements located thereon
including, without limitation, all awards or payments of estimated compensation,
all damages to the Location or any improvements resulting from any taking, all
machinery and equipment dislocation expenses, all settlement amounts, all
apportionments of taxes, reimbursement of attorneys' and en engineers' fees, all
moving expenses and all business dislocation expenses ("Awards");

  (h)  All of Mortgagor's rights in and to the trademarks, tradenames service-
marks, franchises, copyrights in literary property of any kind, jingles,
licenses, permits and privileges owned or held by it and used in the conduct of
the business of the Hotel and/or operations of the Hotel provided that the fore-
going shall not be construed to include the name Lucaya Beach Hotel or any
variation thereof and provided further that to the extent that Mortgagor uses
such trademarks, trade names, service marks,  franchise,  copyrights,  jingle,
licenses, permits and privileges in hotels other than the Hotel, Mortgagor shall
be entitled to continue such use after exercise of the Mortgagee' rights against
such collateral ("Intangibles");

  (i) Claims arising from insurance coverage or against third parties for loss
or damage to or destruction of any of the foregoing ("Insurance Policies"); and

  (j) All proceeds of any of the foregoing ("Proceeds").

All of the Leasehold Estate, Real Property, Improvements, Appurtenances,
Equipment, Building Equipment, Intangibles, Awards, Insurance Policies, Proceeds
and Goods and other property interests referred to above are 
<PAGE>
 
sometimes collectively referred to as the "Mortgaged Property".

T0 HAVE AND T0 HOLD the Mortgaged Property unto Mortgagee, its successors and
assigns forever free from all rights and benefits under the homestead exemption
and valuation laws of any State which said rights and benefits said Mortgagor
does hereby release and waive. All right, title and interest of Mortgagor in and
to all extensions, improvements, and betterments, renewals, substitutes and
replacements of, and all additions and all additions and appurtenances to the
Mortgaged Property hereafter acquired by, or released to, Mortgagor or
constructed, assembled or placed by Mortgagor on the Real Property, and all
conversions of the security constituted thereby, immediately upon such
acquisition, release, construction, assembling, placement or conversion, as the
same may be, and in each such case, without any further mortgage, pledge,
conveyance, assignment or other act by Mortgagor, shall become subject to the
lien of this Mortgage as fully and completely, and with the same effect, as
though now owned by Mortgagor end specifically described herein.
Notwithstanding the foregoing, Mortgagor shall, at its own cost, make, execute,
acknowledge, deliver and record any and all such further acts, deeds,
conveyances, mortgages, notices of assignment transfers, assurances and other
documents as Mortgagee shall from time to time require for better assuring,
conveying, assigning, transferring and confirming unto Mortgagee the Mortgaged
Property and the other rights hereby conveyed or assigned or intended now or
hereafter so to be, or which Mortgagor may be or may hereafter become bound to
convey or assign for carrying out the intention of facilitating the performances
of the terms of this Mortgage. In addition, Mortgagor hereby agrees that this
Mortgage is a security agreement under the Florida Uniform Commercial Code and
hereby grants to and creates in Mortgagee a security interest thereunder in,
among other things, all Equipment, Building Equipment, Intangibles, Awards,
Insurance Policies, Proceeds and Goods.  Mortgagor shall, at its own cost and
expense, execute, deliver and file any financing statements, continuation
certificates and other documents Mortgagee may require from time to time to
perfect and maintain in favor of the Mortgagee a security interest under the
Uniform Commercial Code in such Equipment, Building Equipment, Intangibles,
Awards, Insurance Policies, Proceeds and Goods.  Without limiting the generality
of any of the foregoing, Mortgagor hereby irrevocably appoints Mortgagee
attorney-in-fact for Mortgagor to execute, deliver and file any of the documents
referred to hereinabove for and on behalf of Mortgagor.

  PROVIDED ALWAYS, and these Presents are upon this express condition, that if
Mortgagor or its successors or assigns shall well and truly pay or cause to be
paid unto Mortgagee, its Successors or assigns, the Aggregate Debt secured by
this mortgage, and otherwise perform Mortgagor's Obligations then this Mortgage,
and the estate hereby granted, shall cease, determine and be void, and Mortgagee
shall furnish to Mortgagor a satisfaction of this Mortgage in proper form for
recording, but Mortgagee shall not be required to bear any expense or cost in
connection with such satisfaction or the recording thereof.


THIS MORTGAGE secures not only existing indebtedness (including the sums
advanced and to be advanced pursuant to the Note) but also such additional sum
or sums as may be advanced by the then holder of the Note at any time after the
date hereof, together with interest thereon at the applicable rate provided for
elsewhere herein or if otherwise provided at the time of any such future
advance, then at the rate so provided, to the ease extent as if such future
advance were made on the date of execution of this Mortgage and although there
may be no indebtedness outstanding at the time any such future advances are
made. To the extent permitted by law, all future advances shall be equally
secured with and have the same priority as the original indebtedness secured
hereby and shall be subject to all the terms and provisions of this Mortgage.
The total amount of indebted-
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ness that may be so secured may decrease or increase from time to time, but
the total unpaid balance so secured at any one time shall not exceed a maximum
principal amount of $15,000,000 plus interest thereon and any fees or costs
incurred by Mortgagee as provided in this Mortgage and any disbursements  made
for the payment of taxes, levies or insurance on the Mortgaged Property, with
interest on such disbursements, provided nevertheless that the provisions of
this section shall not be construed to obligate the Mortgagee to make such
future advances.

     MORTGAGOR WARRANTS TO AND COVENANTS WITH MORTGAGEE  as follows:

  1. Title. As of the date hereof (a) Mortgagor has good and marketable title to
the Leasehold Estate and other Mortgaged Property subject to no lien, charge or
encumbrance except for such exemptions to title as are set forth in the
Commitment issued by Attorneys' Title Insurance Fund, Inc. being Commitment No.
C-1599250 shall be approved in writing by Mortgagee; (b) this Mortgage is and
shall retain a valid and enforceable lien on the Mortgagor's interest in the
Mortgaged Property subject only to the matters referred to in subparagraph (a)
hereof; (c) Mortgagor shall preserve such title, and all of its rights in and to
the Mortgaged Property, and shall forever warrant and defend the validity and
priority of the lien hereof against the claims of all persons and entities
whomsoever, subject only to the matters referred to in subparagraph (a) hereof,
and (d) Mortgagor has full power and lawful authority to mortgage the Mortgaged
Property and grant a security interest therein in the manner and form herein
done or intended hereafter to be done.

  2. Payment and Performance. (a) Mortgagor shall punctually pay or cause to be
     -----------------------                                                   
paid the Aggregate Debt, in the amounts and at the times and places that the
same may be due, and perform and comply with all of the terms, covenants,
conditions and obligations contained herein and in the Loan Documents.

  3. Taxes and Other Charges. Mortgagor shall pay all taxes of every kind and
     -----------------------                                                 
nature (including real and personal property, income, gross receipts, franchise,
profits, sales and withholding taxes), all general and special assessments,
water and sewer rents and charges, and all levies, permits, inspection and
license fees and other public charges now or hereinafter levied or assessed
against the Mortgaged Property as liens or assessments (hereinafter individually
called a "Tax" and collectively the "Taxes" as the same shall become due and
payable from time to time and before interest or penalties accrue thereon and
before a lien could be placed upon the Mortgaged Property; provided, however,
that Mortgagor shall not be required to pay any Tax to the extent that
nonpayment thereof is permitted while the validity thereof is being contested,
so long as (a) Mortgagor notifies Mortgagee in writing of its intention to
contest the validity thereof /1/ (b) the validity thereof is being contested in
good faith by Mortgagor and (c) Mortgagor deposits with Mortgagee if Mortgagee
so requests an amount deemed sufficient to make such payment if the contest is
unsuccessful. Notwithstanding the forgoing, Mortgagor shall under no
circumstances permit a lien to be placed upon the Mortgagor's interest in the
Mortgaged Property or permit the Mortgaged property to be sold or advertised for
sale for nonpayment of any Tax. Mortgagor shell not apply for or dais any
deduction from the taxable value of the Mortgaged Property because of the
existence of the Notes or this Mortgage. Subject to Mortgagor's right to contest
any Tax as hereinabove provided, Mortgagor shell deliver to Mortgagee receipts
evidencing the payment of such Tax on or before the 1st day on which any Tax may
be paid without interest or penalties or a lien being placed upon the
Mortgagor's interest in the Mortgaged Property or as soon thereafter as such
receipts are available.

  4. Insurance.  (a) Mortgagor shall keep the Mortgaged Property insured at all
times throughout the term of this Mortgage in accordance with the terms of the
Lease which shall include but not be limited to and paying for all and
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maintaining the following:

  (i) Policies of insurance against loss or damage by fire, lightning,
windstorms, hail, explosion, vandalism, malicious mischief and damage from
                                                  ------------            
aircraft  and vehicles, flooding, collapse and such other hazards as are
presently included in standard "All-Risk Coverage" endorsements in the location
of the Mortgaged Property provided, however, so long as construction is in
progress at any portion of the Mortgaged Property, fire insurance coverage for
such portion of the Mortgaged Property, fire insurance coverage for such portion
shall be pursuant to a "Builders Risk Completed Value Non-Reporting Form" and if
the fire insurance policies shall be in such Builders Risk form, such portion of
the Mortgaged Property may not be occupied unless Mortgagor's insurer
acknowledges to Mortgagee in writing that such insurance shall remain in effect,
notwithstanding the occupancy of such portion of the Mortgaged Property.

The amount of such insurance shall be acceptable to Mortgagee but in any event
in at least such amount as would prevent Mortgagor from becoming a co-insurer.
Such policies shall name Mortgagee as mortgagee thereunder

  (ii) In the event that any portion of the Mortgaged Property shall be leased,
policies of rent insurance against loss of income arising out of damage or
destruction by fire or the perils of "All-Risk Coverage" so called in an amount
equal to the projected yearly rental income from the Mortgaged Property.

  (iii)  Policies of flood hazard insurance an required by a commercial
institutional lender law or evidence acceptable to Mortgagee that flood
insurance is not so required for the Mortgaged Property.

  (iv) Policies of Commercial General liability insurance to afford protection
to a combined single limit as determined from time to time by Mortgagee, but not
less than $1,000,000.

Such policies shall name Mortgagee as "Additional Insured" there-under.

  (v) Such other insurance coverage on the Mortgaged Property or Mortgagor's
Operations thereon or any replacements or substitutions therefor, or additions
thereto, and in such amounts as may from time to time be reasonably required by
Mortgagee against other insurance hazards or casualties which at the time are
commonly insured against in the case of premises and businesses similarly
situated.

  (b) All insurance shall be non-assessable, subject to the approval of
Mortgagee as to insurance agents and companies, amounts, deductible amounts,
contents and form of policies and expiration dates, and shall contain a non-
contributory mortgagee clause or additional insured clause, as applicable, in
favor of and reasonably satisfactory to Mortgagee. Such policies shall provide
for the payment of all costs and expenses incurred by Mortgagee in the event of
any contested claim and all policies shall provide that Mortgagee shall be given
at least thirty (30) days written notice of cancellation, non-renewal or
material change.

  (c) Not less then thirty (30) days prior to the expiration date of expiration
soon policy, Mortgagor will deliver to Mortgagee a prepaid renewal policy or
policies (or certificates evidencing insurance if the policies are master
policies).
 
   (d) In the event of the occurrence of any loss or damage to the Mortgaged
Property or any part thereof, Mortgagor will  give immediate written notice
thereof to Mortgagee, and Mortgages may make proof of loss that if not made
promptly by Mortgagor. Mortgagee may, on behalf of Mortgagor, adjust and
compromise any claims under such insurance and collect and receive the proceeds
thereof and endorse drafts, and Mortgagee and each of 
<PAGE>
 
Mortgagee's officers is hereby irrevocably appointed attorney-in-fact of
Mortgagor for such purposes. Each insurance company is hereby authorized and
directed to make payment under such policies of casualty, rent and/or business
interruption insurance, including return of unearned premiums, directly to
Mortgagee, and Mortgagor appoints Mortgagee, irrevocably, as Mortgagor's
attorney-in-fact to endorse any draft therefor.

  (e) Mortgagee shall have the right, at its election, to retain and apply the
proceeds of any casualty insurance to reduction of the principal amount due
under both or either of the Note, and/or to retain and apply the proceeds of any
rent insurance on account of the payments of the regular monthly installments of
principal and interest as they fall due, month by month, or to restoration or
repair of the property damaged. Notwithstanding the foregoing, upon the written
request of Mortgagor, Mortgagee shall make soon w~m. available to Mortgagor for
repair and restoration of the damaged property, provided that (a) there is not
then in existence an __ of Default and no event has occurred which, with the
giving of notice or passage of time or both, would constitute an event of
Default, (b) Mortgagor shall deposit with Mortgagee at least twenty (20) days
prior to the commencement of any such repair or restoration an amount equal to
the diff_ between the cost to repair the damaged property (as reasonably
estimated by Mortgagee) and the sums made available by Mortgagee on account or
such insurance, and (0) soon repair and restoration can be completed within six
months from the date of the loss.

  (f) If requested by Mortgagee (but not more often than once every year),
Mortgagor shall have the then replacement and insurable values of the buildings
and improvements determined by the underwriter of fire insurance on the
Mortgaged Property, or, if such underwriter will not act, by a qualified
appraiser satisfactory to Mortgagee, and shall deliver such determination to
Mortgagee.

  (g) Mortgagor shall promptly comply with and conform to (i) all provisions of
each insurance policy and (ii) all requirements of the insurers thereunder
applicable to Mortgagor or the Mortgaged property, or to the use, manner of use,
occupancy, possession, operation, maintenance, alteration or repair of any of
the Mortgaged Property, even if such compliance necessitate, structural changes
or improvements or results in interference with the use or enjoyment of any of
the Mortgaged Property. Mortgagor shall not change the present use of any of the
Mortgaged Property in any manner which would permit the insurer to cancel or
increase the premium for any insurance policy.

  (h) If Mortgagee shall acquire title to the Mortgaged Property either by
virtue of a deed in lieu of foreclosure, or a judicial sale thereof pursuant to
proceedings udder the Note of this Mortgage, then all of Mortgagor's estate,
right, title and interest in and to all such policies, including unearned
premiums thereon and the proceeds thereof, shall vest in Mortgagee.

  (i) If Mortgagee shall consent to the use of insurance primate (or a
condemnation award) for restoration:

          (A) prior to commencement of restoration, the contracts, contractors,
plans and specifications for the restoration shall be approved by Mortgagee, and
Mortgagee shall be provided with mechanics' lien insurance (if available) and a
surety bond insuring satisfactory completion of the restoration, soon insurance
and bond to be in form acceptable to Mortgagee);

                                      -6-
<PAGE>
 
  (B) disbursements shall be made from time to time in an amount not exceeding
the cost of the work completed since the last disbursement, upon receipt of
satisfactory evidence from an architect or engineer retained by Mortgagee at
Mortgagor's expense to supervise restoration of the stage of like manner in
accordance with the contracts, plans and specifications;

  (C) Mortgagee may retain ten percent (10%) of the restoration fund until the
restoration is fully completed; and

  (D) the restoration fund shall be deposited in a restricted non-interest
bearing account with Mortgagee (the "restoration account")

  (j) If Mortgagor deposits funds with Mortgagee in accordance with Paragraph
(a) above, such funds shall be disbursed and expanded before any funds in the
restoration account. Any sum so added by Mortgagor which reins in the
restoration fund upon completion of restoration shall be refunded to Mortgagor.
All insurance or condemnation _ if any, remaining after completion of repairs or
restoration or after the occurrence of any Event of Default hereunder shall be
applied by Mortgagee to sums then due and payable under both or either of the
Notes and thereafter to the then outstanding principal balance of (Pounds)
Note.

  (k) Mortgagor shall not take out separate insurance concurrent in form or
contributing in the event of loss with that required to be maintained under this
Paragraph 4, unless Mortgages is included thereon as a named insured with loss
payable to Mortgagee under a standard mortgage endorsement.  Mortgagor shall
immediately notify Mortgagee whenever any such separate insurance is taken out,
specifying the insurer thereunder and full particulars as to the policies
evidencing the same.

  5.  Tax and Insurance Escrow.  Upon the request of Mortgagee (which request
may, at the sole discretion of Mortgagee be made at any time subsequent to the
occurrence of an Event of Default) Mortgagor shall pay or cause to be paid to
Mortgagee on the first day of each month a sum equal to one-twelfth (1/12) of
the amount of (a) all real estate taxes, water and sewer charges and assessments
if any, as estimated from time to time by Mortgagee, becoming due with respect
to the Mortgaged Property on the next succeeding date upon which the same shall
be due and payable and (b) all premiums, computed on an annual basis, for the
insurance requited to be carried pursuant to Paragraph 4 hereof. All soon
amounts (hereinafter, the "Escrows") shall be held by Mortgagee in such manner
as it sees fit without any obligation to invest the same, provided however, that
if and to the extent that Mortgagee is required under applicable law to invest
the Escrow for the benefit of Mortgagor, Mortgagee shall also have the right to
charge a reasonable service fee in connection therewith unless prohibited under
applicable law. The escrows shall be applied to the payment of the respective
items in respect of which the Escrows were deposited, or at Mortgagee's option
to the payment of any such items in such order of priority as Mortgagee shall
determine, as the same become due and payable. If, prior to the date upon which
any of the aforesaid items shall be due and payable, the amount of Escrows than
on deposit therefor shall be insufficient to pay such item, Mortgagor within
five (5) days after demand is made therefor shall deposit the amount of such
deficiency with Mortgagee. If there is an event of default hereunder, Mortgagee
may at its option apply the Escrows or any part thereof in payment of any unpaid
portion of the Aggregate Debt. If, when making any assignment of this Mortgage,
the then mortgagee shall pay over to its assignee the then balance of the
Escrows then such assigning mortgagee shall have no further obligation or
liability to  Mortgagor with respect to such deposits.

  6.  Additions. Alterations. Removals and Repairs.
      -------------------------------------------- 





                                      -7-
<PAGE>
 
  (a) Mortgagor shall not cause or permit any building, structure or improvement
or other Property now or hereafter ~red by the lien of this Mortgage and
comprising part of the Mortgaged Property to be removed or demolished in whole
or in part, or any fixture comprising part of the Mortgaged Property to be
removed, severed or destroyed, without the prior written consent of Mortgagee
which consent shall not be unreasonably withheld or delayed. Mortgagor may make
non-structural changes to the Mortgaged Property as may be required by
Mortgagor's hotel franchiser without the prior consent of the Mortgagee.
~Notwithstanding the foregoing, Mortgagor may remove any fixture on condition
that simultaneously with, or prior to such removal, such fire shall be replaced
with other property to perform the function of the property removed and of a
value at least equal to that of the replaced property and free from any title
retention or security agreement or other encumbrance. By such removal and
replacement, Mortgagor shall be deemed to have subjected such equipment to the
lien of this Mortgage.  Mortgagor will not abandon or cause or permit any waste
to the Mortgaged Property.

  (b) Throughout the term of this Mortgage, Mortgagor, at its sole cost and
expense, will take good care of the Mortgaged Property and the sidewalks, curbs
and vaults, if any, adjoining the Mortgaged Property and will keep the same in
good order and condition and make all necessary repairs thereto, interior and
exterior, structural and nonstructural, ordinary and extra-ordinary, and
unforseen and foreseen all repairs made by Mortgagor shall be at least equal in
quality and class to the original work.  The necessity for and adequacy of
repairs to the buildings and improvements pursuant  to this Paragraph 6 hereof
shall be measured by the standard which is appropriate for structures of similar
construction and class, provided that Mortgagor shall in any event make all
repairs necessary to avoid any structural damage or injury to the buildings and
other Improvements and to keep the buildings and other Improvements in a proper
condition for their intended uses.

  (c) Throughout the term of this Mortgage, Mortgagor, at its sole cost and
expense, shall promptly comply with all present and future laws, ordinances,
orders, rules, regulations and requirements of all federal, state and municipal
governments, courts, debarments, commissions, boards and officers, and national
or local Boards of Fire Underwriters, or any other body exercising functions
similar to those of any of the foregoing which may be applicable to the
Mortgaged Property, the maintenance and use thereof and the sidewalks, curbs and
vaults adjoining the Mortgaged Property, whether or not such law, ordinance,
order, rule, regulation or requirement shall necessitate structural changes or
improvements. Mortgagor will comply with all orders and notices of violations
thereof issued by any governmental authority. Mortgagor will pay all licenses
fees and similar municipal charges and maintain all licenses, permits and
authorizations required for the use of the Mortgaged Property and the other
areas now or hereafter used in connection therewith and will not, unless so
required by any governmental agency having jurisdiction, discontinue use of the
Mortgaged Property without prior written consent of Mortgagee.

  7.  Condemnation. In the event that the whole or any part of the Mortgaged
      ------------                                                          
Property secured by this Mortgage is condemned or been for any period of time,
or there is any other injury to or decease in value of the Mortgaged Property as
a result of any public or quasi-public authority or corporation exercising the
power or eminent domain or otherwise, all sums awarded as damages for such
condemnation or taking to which Mortgagor is entitled shall be paid over
immediately to Mortgagee. Upon the receipt thereof, Mortgagee may deduct and
withhold from the amount actually received any costs, charges or fees incurred
by Mortgagee in connection with the recovery of such award (hereinafter,
("Mortgagee's Costs"), and thereafter Mortgagee may apply



                                      -8-
<PAGE>
 
all or any portion of the balance to the discharge of the Aggregate Debt and, at
the option of Mortgagee, may pay over any sums not so applied to Mortgagor for
the purpose of restoring or repairing the Mortgaged Property, in which event the
Aggregate Debt shall not be reduced by that amount. Notwithstanding the fore-
going, in the event that Mortgagee, at the option of Mortgagee, elects to make
such sues available to Mortgagor for repair and restoration of the Mortgaged
Property, the availability of such funds and the restoration of the Mortgaged
Property shall be governed by the provisions of Paragraph 4(h) hereof. Mortgagor
hereby irrevocably appoints Mortgagee as attorney-in-fact for Mortgagor for the
purpose of collection of any or all proceeds available in connection with the
condemnation of the Mortgaged Property.  If the Mortgaged Property is
transferred, through foreclosure or otherwise, prior to the receipt by Mortgagee
of such award or payment, Mortgagee shall have the right, whether or not a
deficiency judgment on either or both of the Notes shall have been sought,
recovered or denied, to receive such award or payment, or a portion thereof
sufficient to pay the Aggregate Debt, whichever is less.

        8. No Secondary Financing
           ----------------------

          (a) Without the prior written consent of Mortgagee, which consent
shall not be unreasonably withheld by Mortgagee, Mortgagor shall not create or
cause or permit to exist any lien on, or security interest in Mortgagor's
interest in the Mortgaged Property, including any fixture~, equipment or other
items of personal property owned by Mortgagor which are intended to be or _ pert
of the Mortgaged Property, and shall not incur any secured indebtedness for
money borrowed to purchase, improve or operate the Mortgaged Property or any
part thereof, other than the indebtedness secured hereby.

          (b) Mortgagor shall promptly discharge, at Mortgagor's cost and
expense, all liens, encumbrances and charges upon the Mortgagor's interest in
Mortgaged Property, or any part thereof or interest therein; provided, however,
that Mortgagor shall have the right to contest in good faith the validity of any
such lien, encumbrances or charge, if Mortgagor shall first deposit with
Mortgagee a bond or other security satisfactory to Mortgagee in such amount as
Mortgagee shall reasonably require, and provided further that Mortgagor shall
thereafter diligently proceed to cause such lien, encumbrance or charge to be
removed and die-charged.  If Mortgagor shall fail to discharge any such lien,
encumbrance or charge, then, in addition to any other right or remedy of
Mortgagee, Mortgagee may, but shall not be obligated to, discharge the same,
either by paying the amount claimed to be due, or by procuring the discharge of
such lien by depositing in court a bond for the amount claimed or otherwise
giving security for such claim, or in such manner as is or may be prescribed by
law.

          (c) Mortgagor shall not suffer or permit the holder of any subordinate
mortgage or other subordinate lien, whether or not consented to by Mortgagee, to
terminate any  lease of all or any portion of the Mortgaged Property, whether or
not such lease is subordinate (whether by law or the terms of such lease or a
separate agreement) to the lien of this Mortgage, without first obtaining the
prior written consent of Mortgagee. The holder of any subordinate mortgage or
other subordinate lien shall have no such right, whether by foreclosure of its
mortgage or lien or otherwise, to terminate any such lease, whether or not
permitted to do so by Mortgagor or as a matter of law, and any such attempt to
terminate any such lease shall be ineffective and void.

          (d) Mortgagor shall faithfully and fully comply with and abide by each
and every term, covenant and condition of all other mortgages now or, if
permitted by Mortgagee, hereinafter encumbering the Mortgaged Property, or any
part whether


                                      -9-
<PAGE>
 
inferior or superior to the lien of this Mortgage ("Other Mortgages"), and never
permit the same to go into default. A default or delinquency under any such
Other Mortgages shall automatically and immediately constitute a default under
this Mortgage,  __me Mortgages is _ expressly authorized, at the option of the
Mortgagee, to advance all sums necessary to keep any superior mortgage or
mortgages in good standing, and all sums so advanced, together with interest
thereon at the rate set forth in the Note applicable to a period when default
exists thereunder, shall be secured by this Mortgage, and shall be subject to
the provisions hereof. The Mortgagor agrees that the Mortgagor shall not make
any agreement with the holder of any superior mortgage which shall in any way
modify or extend any of the terms or conditions of such superior mortgage, nor
shall the Mortgagor request or accept any future advances under such superior
mortgage without the express written consent of the Mortgagee, nor shall any
negative amortization be permitted under any such superior mortgage without the
express written consent of the Mortgagee. The Mortgagor will furnish to the
Mortgagee, upon demand, proof of payment of all items which are required to be
paid by the Mortgagor pursuant to the Other Mortgages. The Mortgagor shall
execute and deliver, on request of the Mortgages, such instruments as the
Mortgages may deem useful or required to permit the Mortgagee to take such
action as the Mortgages considers desirable to preserve the interest of the
Mortgagee in the Mortgaged Property.

      9.  Transfer of Title.
          ----------------- 

          (a) Unless Mortgagee gives its prior consent in writing, which consent
shall not be unreasonably withheld, it shall be an event of default under this
Mortgage and the Note if Mortgagor transfers, or attempt to transfer
voluntarily, involuntarily or by operation of law, all or any part of its
leasehold interest in the Real Property or Appurtenances or its legal title to
any other portion of the Mortgaged Property of any pert thereof under and
subject to this Mortgage, or any equitable or beneficial interest therein. The
transfer of any or all of the voting shares of stock in the Mortgagor to a
holding company, all of which holding company's voting shares of stock are held
solely by Romulo Bandeira De Souza G. Neto and members of his immediate family,
shall not require prior approval of Mortgages, or constitute a prohibited
transfer, or constitute an event entitling Mortgages to declare the Note to be
due and payable. Any consent given by Mortgages hereunder shall pertain only to
the proposed transfer of title for which the consent was requested and shall not
obligate Mortgages to approve any further transfers or relieve any person or
entity of liability to pay any amount secured hereby agrees that it will not
condition its consent to  a transfer or an the interest rate, prepayment of
Principal reduction of term or other adverse modification of the Note or
Mortgage.

          (b) It is further understood and agreed that Mortgagee shall not
consent to (i) any transfer of less than the entirety of Mortgagor U interest in
Mortgaged Property, or (ii) any transfer in any form which has the effect of
creating additional expense to or charges against the Mortgaged Property. No
encumbrance, subordinate mortgage or junior lien may be created without the
express written consent of Mortgagee which consent may be withheld at
Mortgagee's sole discretion.

        10. Leases; Management.
            ------------------ 

(a) Mortgagor hereby represents and warrants to Mortgagee that there are no sub-
leases or agreements sub-lease all or any part of the Mortgaged Property now in
effect. Mortgagor covenants and agrees that all sub-leases now or hereafter
affecting the Mortgaged Property shall be subordinate to the lien of this
Mortgage. Mortgagor agrees not to enter into any sub-lease for all or any part
of the Mortgaged Property without the prior


                                    - 10 -
<PAGE>
 
written consent of Mortgages which consent may be withheld at Mortgagee's sole
discretion.

          (b) In the event that Mortgagee consents to any future sub-lease of
the Mortgaged Property:

          (i) Mortgagor agrees that all future sub-leases of all or any part of
the Mortgaged Property shall be on such form of sub-lease as shall be first be
approved by Mortgagee.

          (ii) Mortgagor shall promptly (A) perform all of the provisions of the
sub-leases on the part of the sub-landlord thereunder to be perform; (B) enforce
all of the provisions of the sub-lease on the part of the sub-tenants thereunder
to be performed; (C) appear in and defend any action or proceeding arising
under, growing out of or in any manner connected with the sub-leases or the
obligations of Mortgagor as sub-landlord or of the sub-tenants thereunder; and
(D) deliver to Mortgagee, within twenty (20) days after a request by Mortgagee a
written statement containing the names of all sub-tenants, the term of all
subleases and the space occupied and rentals payable thereunder, and a statement
of all sub-leases which are then in default, including the nature and magnitude
of the default.

          (iii) Mortgagor agrees and each sub-lease shall provide that in the
event of a default by Mortgagor and the enforcement by Mortgagee of any remedy
under this Mortgage, the tenant under each lease shall at Mortgagee's request
attorn to Mortgagee or any other person or entity succeeding to the interest of
Mortgages as a result of such enforcement and shall recognize Mortgagee or such
successor in interest as sub-landlord under the lease without change in the
                                                                     --    
provisions thereof; provided, however, that Mortgagee or such successor in
interest shall not be bound by (A) any payment of an installment of rent or
additional rent which may have been made more than thirty days before the due
date of such installment, (B) any amendment or modification to the sub-lease
made without the consent of Mortgagee or such successor in interest, or (C) any
existing off-sets or defenses.

         (iv) Mortgagor agrees to render to Mortgagee within ten (10) days after
written demand therefor a detailed certified statement of Mortgagor specifying
the rents and profits received from the Mortgaged Property for the quarter-
annual period specified in such demand, the disbursements made for such period
and the names of all sub-tenants of the Mortgaged Property, together with true
and correct copies of all sub-leases for which rent is so accounted.

         (c) Mortgagor shall not enter into any agreement for the management or
operation of the Mortgaged Property with a third party without the prior consent
of Mortgagee which consent shall not be unreasonably withheld or delayed.


          11. Hazardous Substances; Wastes.
              ---------------------------- 

  (a) To the best of Mortgagor's knowledge without any investigation: (i) the
Mortgaged Property has not been used to treat, produce, handle, transfer,
process, or otherwise release, or for the generation, manufacture, storage or
disposal of, and there has not been transported to or from the Mortgaged
Property, any Hazardous Substances or Wastes (as those term are herein-after
defined); (ii) there are no Hazardous Substances or Wastes present on the
Mortgaged Property in violation of any applicable law; (iii) Mortgagor has made
no use of the Mortgaged Property that may, under any federal, state or local law
or regulation, require any closure or cessation of the use of the Mortgaged
Property or any part thereof or impose upon the Mortgagor or its successors any
monetary ligations; (iv) the Mortgagor has not been identified and has no
knowledge that it will or may be iden-


                                    - 11 -
<PAGE>
 
tified in any litigation, proceeding or investigation as a responsible party  or
potentially responsible party for any liability for disposal or release of any
Hazardous Substances or Wastes; (y) no lien or super lien has been recorded,
asserted or threatened against the Mortgaged Property for any liability in
connection with any Hazardous Substances or Wastes_ (vi) the Mortgaged Property
is in compliance with all federal, state and local laws and regulations relating
to environmental setters; and (vii) there are no underground storage tanks
located on or under the Mortgaged Property.

  (b) The Mortgagor will not, and will not permit any sub-tenant or any other
occupant of the Mortgaged Property to store, use, generate, treat or dispose of
any Hazardous Substances or Wastes on the Mortgaged Property in violation of any
applicable law.  The Mortgagor promptly shall advise the Mortgagee in writing
of and with respect to any known pending or threatened claim, demand or action
by any governmental authority or third party relating to an "-Hazardous
Substances or Wastes affecting the Mortgaged Property or the discovery of any
Hazardous Substances or Wastes on the Mortgaged Property or any real property
adjoining the Mortgaged Property.  The Mortgagee shall have the right, but not
the obligations, to join in or participate in any legal proceedings or actions
initiated in connection with any Hazardous Substances or Wastes directly or
indirectly affecting the Mortgaged Property. The Mortgagor shall reimburse the
Mortgagee for attorneys' fees in connection therewith and Mortgagor shall
indemnify, defend and hold harmless the Mortgagee from and against any claims,
demands, loss or liabilities, including but not limited to costs of remedies
action, response costs, personal injury and property damage, directly or
indirectly arising out of or attributable to the use, treatment, handling,
transfer, processing, generation, deposit, storage, release, threatened
release, discharge, disposal, burial, dumping, spilling, leak_ or other presence
of Hazardous Substances and Wastes on or under the Mortgaged Property; provided,
however, that this indemnification shall not be applicable to any claims,
demands, losses, or liabilities arising out of or attributable to the use,
treatment, handling, transfer, processing, generation, deposit, storage,
release, threatened release, discharge, disposal, burial, dumping, spilling,
leaking, or other presence of Hazardous Substance and Wastes on, or under the
Mortgaged Property by a party other than Mortgagor and occurring subsequent to
such time as Mortgagee may have become mortgagee in possession of the Mortgaged
Property or occurring after record title to the Mortgaged Property has passed
from Mortgagor to any party not controlled by or under common control with
Mortgagor. Mortgagor shall not, without obtaining the Mortgagee's prior written
consent, enter into any settlement, agreement, consent decree or other
compromise in respect to any Hazardous Substances or Wastes, directly or
indirectly affecting the Mortgaged Property if in the Mortgagee's judgement,
such action could impair the value of the Mortgagee's security.  In the event
that it is determined that there is any contamination of the Mortgaged Property
by Hazardous Substances or Wastes (i) Mortgagor shall at its sole cost and
expense, promptly  remediate such contamination in compliance with all
applicable federal, state and local laws, codes and ordinances and (ii)
Mortgagee may require Mortgagor to provide additional collateral security for
the Loans in an amount equal to the appraised value of the Mortgaged Property
and Mortgagor shall do so within twenty (20) days of Mortgagee's request there-
for.

  (c) For the purpose hereof:  (i) "Hazardous Substances" shall mean any
flammable explosives, radioactive materials, asbestos, urea formaldehyde,
hazardous water, petroleum products, toxic substances or any other elements or
compounds designed as a "hazardous substance," "pollutant" or "contaminant" in
the Comprehensive Environmental Response, Compensation and Liability Act
("CERCLA"), 42 U.S.C. Section 9601 et. Seq. or in

                                    - 12 -
<PAGE>
 
the Resource Conservative and Recovery Act, 42 U.S.C. Section 6901 et.seq.  or
any other applicable federal, state or local law or regulation end (ii) "wastes"
shall mean any hazardous~ wastes, residual wastes, solid wastes or other wastes
as those terms are defined in the applicable federal, state or local laws and
regulations.

  12. Required Notice  Mortgagor shall give Mortgagee prompt written  notice~
      ---------------                                                        
action or proceeding purporting to affect the Mortgaged Property of which it has
actual knowledge including, without limitation, the following:  (a) a fire or
other casualty causing material damage to the Mortgaged Property; (b) receipt of
notice of condemnation or threatened condemnation of the Mortgaged Property or
any part thereof, (c) receipt of notice from any governmental authority relating
to the structure, use or occupancy of the Mortgaged Property' (4) receipt of any
notice from any tenant or landlord of all or any portion of the Mortgaged
Property, (e) receipt of any notice from the holder of any lien or security
interest in the Mortgaged property; or (f) commencement of any litigation
effecting the Mortgaged Property in which the amount in dispute exceeds $10,000.
Mortgagee shall have the right, but not the obligation, to appear in or defend
any such action or proceeding to the ease extent as Mortgagor. Furthermore,
Mortgagee shall have the right, but not the obligation, to bring any action or
proceeding, in the name and on behalf of itself or Mortgagor, which Mortgagee,
in its discretion, feels should be brought to protect its interest in the
Mortgaged Property or any pert thereof.

  13. Mortgagee's Right to Cure.  Mortgagee shall have the right, but not the
      -------------------------                                              
obligation, at Mortgagee's election and without notice to Mortgagor, to cure any
default by Mortgagor hereunder or under the Note or under any mortgage or with
respect to any security interest, lien, lease or encumbrance which is or may
become senior in lien end position to this Mortgage. Any payments made or
expenses incurred by Mortgagee in the exercise of such right shall not release
Mortgagor from Mortgagor's obligation or constitute a waiver of Mortgagor's
default hereunder.  Any such payments made or expenses incurred by Mortgagee
shall be repayable by Mortgagor on demand by Mortgagee, together with interest
thereon at the rate specified in the Note from the data such payments was made
or such expenses was incurred, end the aggregate amount thereof, including such
interest, shall become part of the Aggregate Debt end shall be secured by the
lien of this Mortgage.

  14. Certificate of No Offsets. Within five (5) days after being requested  to
      -------------------------                                                
do so by Mortgagee, Mortgagor shall furnish to Mortgagee or any proposed
assignee of this Mortgage a written statement, duly executed, acknowledged end
certified by Mortgagor, setting forth the remaining unpaid amount of the Ag
gregate Debt end whether there exist any uncured defaults, offsets or defenses
thereto.

  15. Right to Inspect. Mortgagor shall permit Mortgage and its agents to enter
      ----------------                                                         
end inspect the Mortgaged Property or any part thereof at all reasonable times.

  16. Revenue, Tax or Other Stamps. Mortgagor shall pay he solely responsible
      ----------------------------                                           
the cost of any revenue, tax or other stamps flow or hereafter required by the
laws of the State of Florida or the United States to be affixed to the Note or
this Mortgage end if any taxes are imposed under the laws of the State of
Florida or the United States or any other jurisdiction with respect to recording
debts secured by a mortgage, or with respect to recording evidences of
indebtedness so secured, Mortgagor shall pay or reimburse Mortgagee upon demand
the amount of such taxes without credit against any indebtedness evidenced by
the Note. If Mortgagor does not or, for any reason, may not do 80, Mortgagee may
at its option accelerate the indebtedness evidenced


                                    - 13 -
<PAGE>
 
by the Note to maturity as in the case of default by Mortgagor under the Note.

        17. Possession. Until an Event of Default shall have occurred under this
           ------------                                                         
Mortgage,  Mortgagor shall be permitted to retain actual possession of the
Mortgaged Property, to manage, operate, use and enjoy the same and all rights
appertaining thereto and to collect, receive, take, use and enjoy the Income and
Rents.  The right of Mortgagor to collect the Income and Rents may be revoked by
Mortgagee at any time and from time to time after an Event of Default has
occurred under this Mortgage or the Note, by giving notice of such revocation to
Mortgagor, following the giving of such notice, Mortgages may retain and apply
the Income and Pants toward payment of the Aggregate Debt in such priority and
proportions as Mortgagee, in its discretion, shall determine.

        18. Events of Default. The occurrence of any one or more of the
            ------ -- -------                                          
following events shall constitute an event of default ("Event of Default")
hereunder:

        (a)The occurrence of any event of default under the Note

        (b) Mortgagor shall fail to observe and perform any of the non-monetary
covenants or agreements on its part to be observed or performed under this
Mortgage within thirty (30) days after written notice from Mortgagee of such
non-compliance;

        (c) Any representation or warranty of Mortgagor under this Mortgage or
the Note shall be untrue in any material respect;

        (d) If any improvement essential to the continued operation of the
Mortgaged Property is substantially damaged or destroyed by an uninsured
casualty.



        19. Remedies.  Upon the occurrence of any event of default:
            --------                                               

        (a) The Aggregate Debt shall, at the option of Mortgages, become due and
payable immediately without presentment, demand, notice of nonpayment, protest,
notice of protest or other notice of dishonor, all of which are hereby expressly
waived by Mortgagor.

        (b) Mortgagee may institute appropriate proceeding, at law or equity to
collect the amount of the Aggregate Debt then due (by acceleration or
otherwise), or for specific performance of any of the covenants of Mortgagor
under this Mortgage (and Mortgagor acknowledges that all such covenants may be
specifically enforce by Mortgagee by injunction or other appropriate equitable
remedy), or to recover damages for any breach thereof, or to institute an action
of mortgage Foreclosure against the Mortgaged Property, or take such other
action at law or in equity for the enforcement of this Mortgage and realization
on the mortgage security or any other security herein or elsewhere provided for,
and proceed therein to final judgment and execution for the Aggregate Debt, with
interest as specified in paragraph 21 below, together with costs and expenses as
specified in paragraph 21 below.

        (a) With or without demand upon Mortgagor for the surrender of
possession, Mortgagee may enter upon and take possession of the Mortgaged
property, breaking locks if necessary and without liability for trespass,
damages or otherwise and, upon so doing, Mortgagee may, in its discretion and in
addition to any of its other rights, as Mortgagee in possession, alter, improve,
complete or repair the Mortgaged property (and in so doing Mortgages shell have
the right to use the Mortgaged Property and to


                                    - 14 -
<PAGE>
 
expend such amount for that purpose as Mortgagee shall deem best, all of which,
with interest thereon at the rate specified in the Term Note from date of
payment, shall be repayable by the Borrowers on dem_ and shall be secured
hereby), and operate, rent, sell or lease the same in the name of Mortgagor or
Mortgagee upon such terms and conditions as Mortgagee shall deem appropriate,
and Mortgagor hereby irrevocably appoints Mortgagee attorney-in-fact for
Mortgagor for all such purposes.

     (d) Mortgagee may further, by summary proceedings, initiate an action for
possession or otherwise dispose any tenants, users or occupiers of the Mortgaged
Property than or thereafter in default in the payment of any rent or other
charge for the use thereof, and any tenants or other users or occupiers whose
leasehold estates or rights to use the Mortgaged Property are subordinate to the
lien of this Mortgage, whether or not any such tenant user or occupier is so in
default; and Mortgagor hereby irrevocably appoints Mortgagee attorney-in-fact of
Mortgagor for all such ~ If Mortgagor remains in possession after demand by
Mortgagee for surrender of possession of the Mortgaged Property, such continued
possession by Mortgagor shall be 55 tenant of Mortgagee, and Mortgagor agrees to
pay monthly in advance to Mortgagee such rent for the Mortgaged Property 50
occupied as Mortgagee may demand, and in default of so doing, Mortgagor may also
be dispossessed by summary proceedings or otherwise.  In case of the appointment
of a receiver of the rents, the foregoing agreement of Mortgagor to pay rent
shall inure to the benefit of such receiver.

          (e) With or without taking possession of the Mortgaged property,
Mortgagee may collect and receive all the Income and Rents and, after deducting
the cost of all alterations, improvements, repairs, completion, partial
completion, operation, sale, rental, leasing commissions and charges, including,
but not limited to, counsel fees, incurred by Mortgagee, apply the net income to
the sums secured hereby in such manner as Mortgagee in its discretion shall
determine.  Mortgages shall be liable to account only for the Income and Rents
actually received.

          (f) If Mortgagee shall so elect, Mortgagor shall not resist or
contest, but shall join in any petition to any court by Mortgagee for the
appointment of a receiver or receivers of the Mortgaged Property or any part
thereof, and of all the Income and Rents therefrom, with such powers as the
court making such appointment shall confer, and Mortgagor hereby appoints
Mortgagee attorney-in-fact of Mortgagor for all such purposes.

          (g) All deposits held in connection with the rental, lease, license or
use of space or other facilities on the Mortgaged property at the tine of the
occurrence of such Event of Default, all interest of Mortgagor in all premiums
for, or dividends upon, any insurance for the Mortgaged Property, and all
refunds or rebates of taxes and assessments upon the Mortgaged Property, are
hereby assigned to Mortgagee, to the extent permitted by law, as further
security for the payment of the Aggregate Debt during the continuance of any
such Event of Default until the Aggregate Debt has bean paid in full.

          (h) To the extent now or hereafter permitted by law and subject to
such grace periods and notice requirements thereby imposed, Mortgagee may cause
a judicial sale of the Mortgaged property in accordance with this subparagraph
(h). Such sale may be made without demand on Mortgagor at the time and place
fixed in the notice of such sale, and such sale may be of the Mortgaged property
as a whole or in separate lots or parcels, and in such order as Mortgagee may
determine, at public auction to the highest bidder for cash in lawful money of
the United States, payable at tine of sale.  Such sale of the Mortgaged Property
may be postponed by public ~ at the time and place of sale and may be further
postponed from time to time thereafter by


                                    - 15 -
<PAGE>
 
public announcement at the time fixed by the preceding postponement. Any person
or entity, including Mortgagee, may purchase at such sale.  After deducting all
costs, fees, and expanses of Mortgagee, including cost of evidence of title in
connection with such sale, the proceeds of sale shall be applied to payment of
the Aggregate Debt. The Mortgaged Property may be sold as aforesaid either
before, after, or during the pendency of any proceedings for power with respect
to the enforcement of the provisions of any of the Loan Documents or the
collection of the amount of the Aggregate Debt. The provisions of this
subparagraph (h) are not intended to and shall not adversely affect Mortgagee's
rights to conduct a non-judicial sale of such portions of the Mortgaged Property
as constitute personal property.

(i)Mortgagee may pursue any and all other remedies which are otherwise available
to Mortgagee at law or in equity.

        20. Remedies Cumulative. etc.
            -------------------------

(a) No right or remedy conferred upon or reserved to Mortgagee under any of the
Loan Documents or with respect to any Collateral, or now or hereafter existing
at law or in equity or by statute or other legislative enactment, is intended to
be exclusive of any other such right or remedy and each and every such right or
remedy shall be cumulative and concurrent, and shall be pursued separately,
concurrently, successively or otherwise, at the sole discretion of Mortgagee,
and shall so be exhausted by any one exercise thereof but may be exercised as
often as occasion therefor shall occur. No act of Mortgagee shall be deemed or
construed as an election to proceed under any one such right or remedy to the
exclusion of any other such right or remedy; furthermore, each such right or
remedy of Mortgagee shall be separate, distinct and cumulative and none shall be
given effect to the exclusion of any other. The failure to exercise or delay in
exercising any such right or remedy or the failure to insist upon strict
performance of any term of the Note or this Mortgage, shall not be construed as
a waiver or release of the same, or of any event of default thereunder, or of
any obligation or liability of Mortgagor thereunder.

(b) The recovery of any judgment by Mortgagee or the levy of execution udder any
judgment upon the Mortgaged Property shall not affect in any manner, or to any
extent, the lien of this Mortgage upon the Mortgaged Property, or any security
interest in any other Collateral, or any rights, remedies or powers of Mortgagee
with respect to any Collateral, but such lien and such security interest and
such rights, remedies and powers of Mortgagee shall continue unimpaired as
before.  Further, the entry of any judgment by Mortgagee shall not affect in any
way the interest payable hereunder on any amounts due to Mortgagee, but interest
shall continue to accrue on such amounts at the Default Rate (as hereinafter
defined) after the entry of any judgment and continuing until distribution of
the proceeds of any Sheriff's sale.

(a) Mortgagor hereby waives presentment, demand, notice of nonpayment, protest,
notice of protest or other notice of dishonor, and any and all other notices in
connection with any default in the payment of, or any enforcement of the payment
of, the Aggregate Debt (except as otherwise specifically provided in Paragraph
18 hereof). To the extent permitted by law, Mortgagor waives the right to any
stay of execution and the benefit of all exemption laws now or hereinafter in
effect.

(d) Mortgagor agrees that Mortgagee may release, compromise, forbear with
respect to, waive, suspend, extend or renew any of the terms of the Note (and
Mortgagor hereby waives any notice of any of the foregoing), and that the Note
may be amended, supplemented or modified by Mortgagee and the other signatory
parties and that Mortgagee may resort to any Collateral in such order and manner
as it may think fit or accept the assignment, substitution, 
<PAGE>
 
exchange or pledge of any other collateral in place of, or release for such
consideration, or none, as it may require all or any portion of any Collateral,
without in any way affecting the validity of its lien over or other security
interest in the remainder of any such Collateral (or the priority thereof or the
position of any subordinate holder of any lien or other security interest with
respect thereto); and any action taken by Mortgagee pursuant to any of the
foregoing shall in no way be construed as a waiver or release of any right or
remedy of Mortgagee, or of any Event of Default, or of any liability or
obligation of Mortgagor, under any of the Note on this Mortgage

  a) To the extent permitted by law, Mortgagor shall not at any time insist
upon, or plead, or in any manner whatever claim or take any benefit or advantage
of any stay or extension or moratorium law, or any exemption from execution or
sale of the Mortgaged Property, wherever enacted, now or at any time hereafter
in force, which may affect the covenants and terms of performance of this
Mortgage, nor claim, take, or insist upon any benefit or advantage of any law
now or hereafter in force providing for the valuation or appraisal of the
Mortgaged Property, prior to any sale of any of Mortgagor's interest therein;
nor, after any such sale or sales, claim or exercise any right under any statute
heretofore or hereafter enacted to redeem the Real Property so sold or any part
thereof, and Mortgagor hereby expressly waives all benefit or advantage of any
such law or laws, and covenants not to hinder, delay, or impede the execution of
any power herein granted to us though no such law or laws had been made or
enacted. Mortgagor further waives and releases all procedural errors, defects
and imperfections in any proceeding instituted by Mortgagee under the Note or
this Mortgage.

  (f) Mortgagor, for itself and for all persons hereafter claiming through or
under it or who may at any time hereinafter become holders of liens junior to
the lien of this Mortgage, hereby expressly waives and releases all rights to
direct the order in which any of the Mortgaged property shall be sold in the
event of any sale or sales pursuant hereto and to have any of the Mortgaged
Property and/or any other property now or hereafter constituting security for
the Aggregate Debt marshaled upon any foreclosure of this Mortgage or of any
other security for any of the Aggregate Debt.

  21. Default Rate; Penalty. Following the occurrence of any Event of Default
      ---------------------                                                  
and continuing (notwithstanding the entry of any judgment by Mortgagee against
Mortgagor) either until the date such Event of Default is cured to the
satisfaction of the Mortgagee or until the Aggregate Sum, and all other sums
payable under the Note is paid in full, whichever occurs first, the principal
sum outstanding under the Note shall bear interest at the highest rate permitted
under the laws of the State of Florida (the "Default Rate") (unless applicable
law provides that a statutory rate shall apply notwithstanding such a contract
rate) and shall be secured by this Mortgage and by all other Collateral.

  22. Counsel Fees. If Mortgagee retains the services of counsel in order to
cure any default under this Mortgage or the Note, or if Mortgagee becomes a
party to any suit or proceeding affecting the Mortgaged Property or title
thereto, the lien created by this Mortgage or Mortgagee's interest therein, or
following an Event or Events of Default hereunder if Mortgagee engages counsel
to collect any of the indebtedness or to enforce performance of the agreements,
conditions,  covenants, provisions or stipulations of this Mortgage or the Note,
Mortgagee's costs, expenses and reasonable counsel fees, whether or not suit is
instituted, shall be payable by Mortgagor to Mortgagee on demand and shall be
secured hereby. Mortgagor shall pay the cost of the title search and all other
costs incurred by Mortgagee in connection with proceedings to recover any sums
secured hereby. Mortgagor shall also pay any reasonable charge of Mortgagee in
connection with the satisfaction of this Mortgage of record.

                                     -17-
<PAGE>
 
  23. Renewals. This Mortgage shall secure any and all renewals, or extensions
      --------                                                                
of the whole or any part of the indebtedness hereby secured however evidenced,
with interest at such lawful rate as may be agreed upon end any such renewals or
extensions or any change in the terms or rate of interest shall not impair in
any manner the validity or of priority of this Mortgage.

  24. Severability. In the event that for any reason one or more of the
      ------------                                                     
provisions of this Mortgage or their application to any person or circumstances
shall be held to be invalid, illegal, or unenforceable in any respect or to any
extent, such provisions shall nevertheless remain valid, legal and enforceable
in all such other res_ end to such extent as may be permissible. In addition,
any such invalidity, illegality, or unenforcebility shall not effect any other
provision of this Mortgage, but this Mortgage shall be construed as if such
invalid, illegal or unenforceable provision had never been contained herein.

  25. Successors and Assigns. This Mortgage insures to the benefit of Mortgagee
      -----------------------                                                  
and binds Mortgagor, and their respective successors and assigns, ~ and the
words "Mortgagee" and "Mortgagor" whenever occurring herein shall be deemed to
include such respective successors and assigns.  Mortgagee may assign or
otherwise transfer this Mortgage and the Note secured hereby to any other
person, and such other person shall thereupon become vested with all of the
benefits in respect thereof granted to Mortgagee herein or otherwise.

  26. Notices. All notices required to be given to any of the parties hereunder
      -------                                                                  
shall be in writing and shall be deemed to have been sufficiently given for all
purposes when presented personally to such party or sent by reputable overnight
courier or certified or registered mail, return receipt requested, to such party
at its address set forth below:


    Mortgagor:      Lucaya Beach Hotel Corporation
                    1200 North Ocean Boulevard
                    Pompano Beach, Florida
                    Attn: Mr. Romulo De Souza

                    With a Copy to:
                    Douglas Bates, Esquire
                    2701 H. Sunrise Boulevard, Suite 300
                    Fort Lauderdale, Florida 33304

    Mortgagee:
                    Del-Aire Management Co., Inc.
                    4541 White Cedar Lane
                    Delray Beach, Florida 33445



                With a copy to:

                    Lee C. Summers, Esquire
                    Mattlin & McClosky
                    5355 Town Center Road
                    Suite 901
                    Boca Raton, Florida 33486
<PAGE>
 
          Such notice shall be deemed to be given when received if delivered
personally or by overnight courier or two (2) days after the date mailed if sent
by certified or registered mail, return receipt requested.  Any notice of any
change in such address shall also be given in the manner set forth above.
Whenever the giving of notice is required, the giving of such notice may be
waived in writing by the party entitled to receive such notice.

          27. Definitions; Number and Gender. In the event Mortgagor consists of
              ------------------------------                                    
more than one person or entity, the obligations and liabilities hereunder of
each of such persons and entities shall be joint and several and the word
"Mortgagor shall mean all or some of any of them. For purposes of this Mortgage,
the singular shall be deemed to include the plural and the neuter shall be
deemed to include the masculine and feminine, as the context may require.  The
words "Real Property". "Mortgaged Property". "Improvements", "Appurtenances,
"Equipment", "Building Equipment", "Intangibles", "Awards", "Insurance
Policies", "Goods" and "Proceeds" shall include any portion of and additions to
the Real property, the Mortgaged Property, the Improvements, the Appurtenances,
the Equipment, the Building Equipment, the Intangibles, the Awards, the
Insurance Policies, the Goods and the Proceeds, respectively.

          28. Incorporated by Reference.  All of the terms and provisions of the
              --------------------------                                        
Note are hereby incorporated herein by reference.

          29. Captions.  The captions or headings of the paragraphs of this
              --------                                                     
Mortgage are for convenience only and shall not control or affect the meaning or
construction of any of the terms or provisions of this Mortgage.

          30. Governing Law. This Mortgage shall be governed by and construed 
              --------------     
in accordance with the laws of the State of Florida.

      IN WITNESS WHEREOF, Mortgagor has executed this Mortgage the day and year
first above written.


                      LUCAYA BEACH HOTEL CORPORATION

                      By: /s/ Romulo Bandeira de Souza G. Neto
                      Romulo Bandeira de Souza G. Neto


    Witnesses

    /s/ Douglas M. Bates
    Douglas M. Bates

    /s/ Harriet H. Brewer
    Harriet H. Brewer


    STATE OF FLORIDA  
      COUNTY OR BROWARD

      I HEREBY CERTIFY that on this day, before me, an officer duly authorized
in the State aforesaid and in the County aforesaid to take acknowledgments,
personally appeared Romulo Bandeira de Souza G. Neto, as President of LUCAYA
BEACH HOTEL CORPORATION to me known to be the person described in and who
executed the foregoing instrument and he acknowledged before me that he executed
the same.

     WITNESS my hand and official seal in the County and State last aforesaid
this 26th, day of February l992
     ----         --------     

 
                         /s/ Douglas M. Bates
                           Notary Public
                         DOUGLAS M. BATES



                                    - 19 -
<PAGE>
 
                    NEGOTIABLE PURCHASE MONEY MORTGAGE NOTE
                    ---------------------------------------

                        Boca Raton, Florida February 26, 1992

          FOR VALUE RECEIVED, the undersigned, promises to pay to the order of
DEL-AIRE MANAGEMENT CO., INC. at 4541 White Cedar Lane, Delray Beach, Florida,
or such other place as the Holder may from time to time in writing designate,
the principal sum of ONE MILLION TWO HUNDRED THOUSAND AND NO/l00 DOLLARS
($1,200,000.00), together with interest at the rate of seven and three-forths
percent (7 3/4%) per annum from date hereof until maturity, all payable in
lawful money of the United States of America, payable as follows:

81,200,000.00

  Interest and principal shall be payable in fifty-nine (59) monthly
installments of Nine Thousand Eight Hundred Fifty-One and 38/100 Dollars
(89,851.38) each beginning on the first day of April, 1992, with the sixtieth
(60th) and final payment consisting of the unpaid principal balance and interest
accrued and unpaid thereon which shall be due and payable March 1, 1997-

  This Note may be prepaid in whole or in part, at any time or from time to
time.

  The unpaid principal balance, and all accrued interest thereon, shall become
immediately due and payable, at the option of the Holder, seven (7) days after
the failure of the Maker to pay an installment due hereunder on or before the
due date established in this Note.

  Not amending the grace period recited herein, in the event that any payment is
not made within fifteen (15) days from its due date, there shall be assessed a
late fee equal to five percent (5%) of the monthly payment.

  This Note is secured by a Purchase Money Mortgage and Security Agreement on a
leasehold interest in real estate and personal property executed simultaneously
with this Note.  A default under said purchase Money Mortgage and Security
Agreement shall likewise constitute a default hereunder.

  In the event of default, this Note shall bear interest from the date of said
default at the highest  permissible rate permitted by the Statutes of the State
of Florida.
<PAGE>
 
It is agreed that time is of the essence in the performance of all obligations
hereunder and under the Purchase Money Mortgage and Security Agreement.

          Maker and all endorsers and guarantor, waive demand, protest and
notice of maturity, non-payment or protest, diligence in collection or
bringing suit, end all requirements necessary to hold it liable as maker. Maker
further agrees, to pay all costs of collection, including reasonable attorneys'
fees in case the principal of this Note or any payment on the principal or any
interest thereon is not paid at the respective maturity thereof, or in case it
becomes necessary to protect the security hereof, whether suit be brought or
not.

          The right to plead any and all statutes of limitation as a defense to
any demand on this Note, or any agreement to pay the same, or any demand secured
by the purchase Money Mortgage and Security Agreement securing this Note, is
expressly waived by each and every of the undersigned, endorsers or guarantors
to the fullest extent permitted by law.

All makers, endorsers, guarantors and sureties hereof agree jointly end
severally to pay all costs of collection and of suit and foreclosure, end to the
extent permitted by law, reasonable attorneys' fees.

Any forbearance of Holder in exercising any right or remedy hereunder or under
the purchase Money Mortgage and Security Agreement, or otherwise afforded by
applicable law, shall not be a waiver of or preclude the exercise of any right
or remedy.

The acceptance by Holder of payment of any sum payable hereunder after the due
date of such payment shall not be a waiver of Holder's right to either require
prompt payment when due of all other sums payable hereunder or to declare a
default for failure to make prompt payment. Holder shall at all times have the
right to proceed against any portion of the security held herefor in such order
and in such manner as Holder may deem fit, without waiving any rights with
respect to any other security. No delay or omission on the part of Holder in
exercising any right hereunder shall operate as a waiver of such right or of any
other right under this Note.

 
<PAGE>
 
Notwithstanding anything herein or in any installment by which this Note may be
secured to the contrary, no provision contain_ herein or therein which purports
to obligate the under-signed to pay any amount of interest or any fees, costs or
expenses which are in excess of the maximum permitted by applicable law, shall
be effective to the extent it calls for the payment of any interest or other
amount in excess of such maximum. Any such excess shall, at the option of the
Holder of this Note, either be paid to the undersigned or be credited to
principal.

        This Note is made in the State of Florida and is to be governed and
construed in accordance with its laws.


                                LUCAYA BEACH HOTEL CORPORATION


                                By:Romulo Bandeira De Souza G. Neto president

                                   GUARANTY
                                   --------

          The undersigned, Romulo Bandeira De Souza G. Neto, does hereby
absolutely and unconditionally guarantee the performance by Lucaya Beach Hotel
Corporation ("Maker") of all the terms and conditions of this Note and the
Purchase Money Mortgage  and Security Agreement referred to herein, including,
but not limited to, the prompt and complete payment by Maker of all sums due
hereunder.



                       Romulo Bandeira De Souza G. Neto

STATE OF FLORIDA
COUNTY OF PALM BEACH

          I HEREBY CERTIFY that on this day, before me, an officer duly
authorized in the State aforesaid and in the County aforesaid to take
acknowledgments, personally appeared Romulo Bandeira De Souza G. Neto, to me
known to be the person described in and who executed the foregoing instrument
and he acknowledged before ma that he executed the same.

            WITNESS my hand and official seal in the County and State last
aforesaid this ___ day of ____________, l99_.
                                                                               I

                            My Commission Expires:


                                      -3-
<PAGE>
 
                               LEGAL DESCRIPTION
                               -----------------

Lots 14, 15 and 16 in Block 13 of POMPANO BY THE SEA RESUBDIVISION, according to
the P1at thereof, recorded in P1at Book 1, Page 22 of the Public Records of
Broward County, Florida.

TOGETHER WITH that portion of the East one-half of Alta Avenue, lying West of
and adjacent to Lots 14, 15 and 16, in said Block
13.

TOGETHER WITH the following described property:

Begin at the intersection of the Center Line of Alta Avenue with a westerly
extension of the North boundary of Lot 16, Block 13 as shown on the Plat of
POMPANO BY THE SEA, as recorded in Plat Book 1, Page 22 of the Public Records of
                                                                      -------   
Broward County, Florida; thence westerly along said westerly extension of the
North boundary line of said Lot 16 a distance of 15.91 feet; thence Southerly,
making an included angle of 104 degrees, 14', 30" a distance of 123.76 feet;
thence Easterly with an included angle of 75 degrees, 45', 30" a distance of
45.64 feet to the Center Line of Alta Avenue; thence North along said Center 
                                              ------
Line a distance of 120.0 feet more or less, to the point of beginning.