FIRST AMENDMENT TO THIRD AMENDED AND
                        RESTATED REVOLVING LOAN AGREEMENT


         THIS FIRST  AMENDMENT  TO THIRD  AMENDED AND  RESTATED  REVOLVING  LOAN
AGREEMENT  (this "FIRST  AMENDMENT") is made as of June 30, 1999 (the "EFFECTIVE
DATE"),  by  and  among  ATLANTIC  GULF  COMMUNITIES  CORPORATION,   a  Delaware
corporation,  formerly known as General Development Corporation (the "COMPANY"),
DAVIDSON KEMPNER SERVICE  COMPANY,  LLC, a New York limited  liability  company,
successor  to M. H.  Davidson & Co.,  LLC, as agent for the Banks (as defined in
the Loan Agreement) under the Loan Agreement (hereinafter defined) (hereinafter,
in such  capacity,  together  with  any  successors  thereto  in such  capacity,
referred to as "AGENT"),  and DAVIDSON KEMPNER SERVICE COMPANY,  LLC, a New York
limited liability company,  successor to M.H. Davidson & Co., LLC, as collateral
agent for the Banks under the Loan  Agreement  (hereinafter,  in such  capacity,
together  with  any  successors  thereto  in  such  capacity,   referred  to  as
"COLLATERAL AGENT").

         Each of Company,  Agent and Collateral  Agent is sometimes  referred to
herein as "PARTY" and all of them, together, are collectively referred to herein
as the "PARTIES."

                               W I T N E S E T H:

         WHEREAS,  the  Parties  entered  into that  certain  Third  Amended and
Restated Revolving Loan Agreement (the "LOAN  AGREEMENT"),  dated as of December
31, 1998; and

         WHEREAS, the Company has requested certain  modifications to, and Agent
has agreed to modify,  the terms of Sections 7.1 and 7.15 of the Loan Agreement;
and

         WHEREAS,  the  Parties now desire to amend the Loan  Agreement,  on and
subject to the terms hereinafter set forth.

         NOW,  THEREFORE,  in  consideration  of the  respective  covenants  and
agreements set forth herein, and for other good and valuable consideration,  the
receipt  and legal  sufficiency  of which are hereby  acknowledged,  the Parties
hereto hereby agree as follows:

         1.   Capitalized  terms used and not  defined  in this First  Amendment
shall have the meanings given them in the Loan Agreement.

         2.   The  first  paragraph  of  Section  7.1 of the Loan  Agreement  is
deleted in its entirety and the following new language is inserted in its place:

              "Permit  Consolidated  Net Worth to be less than (a) $25
              million so long as the aggregate  outstanding  principal
              balance of all Loans equals or exceeds  $25,000,000  and
              (b) $20  million  so long as the  aggregate  outstanding

<PAGE>


              principal balance of all Loans is less than $25,000,000;
              LESS, in each case,  (1) the GAAP Book Value of Homesite
              Contract  Receivables,  Commercial  Receivables  and the
              real  property   consisting   of  identified   scattered
              homesites and Eligible  Tract Land,  plus (2) the amount
              of the GAAP book loss,  if any,  realized  by Company in
              connection  with  the sale of any  Collateral  permitted
              under  this  Agreement,  other  than  sales of  Homesite
              Contract  Receivables,  Commercial  Receivables  and the
              real  property   consisting   of  identified   scattered
              homesites and Eligible Tract Land."

         3.   The second paragraph of Section 7.1 is deleted in its entirety and
the following new language is inserted in its place:

              "To  demonstrate  compliance with the  Consolidated  Net
              Worth covenant set forth in this Section,  Company shall
              furnish to Banks (i) within 45 days of the close of each
              calendar quarter a certificate of a Responsible  Officer
              setting  forth  Consolidated  Net  Worth  for such  date
              calculated in accordance  with this Section 7.1, and the
              calculation  upon which it is based;  and (ii) within 90
              days of the close of each fiscal year, a certificate  of
              a Responsible  Officer  setting forth  Consolidated  Net
              Worth as of such date calculated in accordance with this
              Section 7.1 and the calculation  upon which it is based,
              reflecting  in each  such  certificate  delivered  under
              clause  (i) and  (ii) any  adjustments  the  Company  is
              required to make in calculating  Consolidated  Net Worth
              pursuant   to  clauses  (1)  and/or  (2)  of  the  first
              paragraph of this Section 7.1 during the period to which
              such certificate relates."

         4.   The  text of  Section  7.15 is  deleted  in its  entirety  and the
following new language is inserted in its place:

              "[RESERVED]"

         5.   The definition of the "Borrowing  Base" in Section 1.1 of the Loan
Agreement  shall be deleted in its  entirety and the  following  new language is
inserted in its place:

              "Borrowing Base' means the sum of

              A.           an  amount  equal  to  $10,328,000  with  respect  to
                           Eligible Homesite  Contract  Receivables and Eligible
                           Commercial  Receivables  ("Receivables") less the sum
                           of (i) 75% of the  aggregate  net cash  proceeds from
                           the  sales  or  other   dispositions  of  Receivables
                           closing  after  June  30,  1999,   (ii)  75%  of  the
                           principal   payments   received   with   respect   to
                           Receivables  after June 30, 1999 and (iii) 75% of the
                           principal  amount  (as  of  June  30,  1999)  of  any
                           Receivables  that are  foreclosed  on,  terminated by
                           reason of a deed in lieu or  canceled  after June 30,
                           1999;

                                       2
<PAGE>

              plus


              B.           an  amount  equal  to  $2,260,000   with  respect  to
                           Commercial    Receivables   or   Homesite    Contract
                           Receivables   which  are  not   Eligible   Commercial
                           Receivables    or    Eligible    Homesite    Contract
                           Receivables,   as  the  case   may  be   ("Ineligible
                           Receivables"),  less  the  sum  of  (i)  50%  of  the
                           aggregate  net cash  proceeds from the sales or other
                           dispositions of Ineligible  Receivables closing after
                           June 30,  1999,  (ii) 50% of the  principal  payments
                           received with respect to Ineligible Receivables after
                           June 30, 1999 and (iii) 50% of the  principal  amount
                           (as of June 30, 1999) of any  Ineligible  Receivables
                           that are  foreclosed  on,  terminated  by reason of a
                           deed in lieu or canceled after June 30, 1999;

              plus

              C.           an  amount  equal to the sum of (i)  $8,865,000  with
                           respect to Real  Property  consisting  of  identified
                           scattered  homesites  owned by the Company as of June
                           30,  1999,  plus  (ii)  50%  of  the  "value"  of any
                           identified  scattered homesites reacquired after June
                           30, 1999 as the result of  foreclosure,  deed in lieu
                           or  cancellation  of  Ineligible  Receivables  (which
                           value  for  purposes  hereof  shall  be  equal to the
                           principal amount of such Ineligible Receivables) plus
                           (iii)   $1,194  with   respect  to  each   identified
                           scattered  homesite release from the Class 14 Utility
                           Reserve  after  June 30,  1999,  less,  in all  three
                           cases,  50% of the  aggregate  net cash proceeds from
                           the sales or other  dispositions  of such  identified
                           scattered homesites closing after June 30, 1999;

              plus

              D.           an  amount  equal to the sum of (i)  $3,232,000  with
                           respect to Real  Property  consisting  of  identified
                           Eligible  Tract Land owned by the  Company as of June
                           30,  1999,  plus  (ii)  50%  of  the  "value"  of any
                           identified  Eligible Tract Land reacquired after June
                           30, 1999, as the result of foreclosure,  deed in lieu
                           or  cancellation  of  Ineligible  Receivables  (which
                           value  for  purposes  hereof  shall  be  equal to the
                           principal  amount  of such  Ineligible  Receivables),
                           less 50% of the  aggregate net cash proceeds from the
                           sales or other  dispositions  of such Eligible  Tract
                           Land closing after June 30, 1999;

              plus

              E.           an amount  equal to 20% of the sum of (i) Net  Equity
                           of the West  Meadow  project,  the  Lakeside  Estates
                           project,  the Saxon Woods project, the Trails of West
                           Frisco  project and the  Riverwalk  Tower project and
                           (ii) Fair Market of the Falcon Trace  project and the
                           Sunset Lakes project."

         6.   The Company hereby agrees to pay:

                                       3
<PAGE>


              a.           the  following  amounts by wire  transfer to (or such
other method as instructed  in writing by) the Agent for the ratable  benefit of
the Agent and the Banks:

                           i.       $98,750  (the  "INITIAL  FEE") in good funds
upon the execution and delivery by the Parties of this First Amendment;

                           ii.      an  amount  in good  funds on  February  28,
2000, equal to 1% of the aggregate outstanding principal balance of the Loans on
February 28, 2000, exclusive of the outstanding amount of Letter of Credit Usage
on such date;

                           iii.     an amount in good  funds on March 31,  2000,
equal to 1% of the aggregate outstanding principal balance of the Loans on March
31, 2000,  exclusive of the outstanding amount of Letter of Credit Usage on such
date;

                           iv.      an  amount  in good  funds on May 31,  2000,
equal to 1.25% of the aggregate  outstanding  principal  balance of the Loans on
May 31, 2000,  exclusive of the outstanding  amount of Letter of Credit Usage on
such date; and

                           v.       an  amount in good  funds on June 30,  2000,
equal to 0.75% of the aggregate  outstanding  principal  balance of the Loans on
June 30, 2000,  exclusive of the outstanding amount of Letter of Credit Usage on
such date.

         7.   This First Amendment  shall become  effective as of June 30, 1999,
upon the satisfaction of all of the following conditions:

              a.           the Company has executed and delivered this Agreement
to the Agent and Collateral Agent;

              b.           the Agent and  Collateral  Agent  have  executed  and
delivered this Agreement to the Company; and

              c.           the Company has paid (i) the Initial Fee to the Agent
for the benefit of the Agent and the Banks, and (ii) all legal fees and expenses
incurred by the Agent and the Banks in connection with this First Amendment.

         8.   The Company  hereby  represents  and warrants  that there exist no
causes of action, offsets, claims, counterclaims or defenses with respect to (i)
its obligations  under the Loan Agreement or any of the other Loan Documents and
(ii) the obligations of any of the entities set forth on EXHIBIT A, under any of
the Loan Documents.

         9.   The Company  hereby  ratifies  and confirms  that the  outstanding
principal balance of the Loans as of the Effective Date is $27,000,000.

                                       4
<PAGE>


         10.  The Company  hereby  represents and warrants to and covenants with
Agent that  Company has full power,  authority  and legal right to execute  this
First Amendment and to keep and observe all of the terms of this First Amendment
on  Company's  part to be  observed  and  performed,  and that  each  and  every
representation and warranty contained in Article 4 of the Loan Agreement is true
and correct as of the date hereof.

         11.  The Loan Agreement, as modified hereby, and the Loan Documents are
hereby  ratified and confirmed in all respects,  and the Loan  Agreement,  as so
modified,  and the Loan  Documents  shall  continue  in full force and effect in
accordance with their respective  terms.  From and after the Effective Date, all
references in any of the Loan  Documents to the Loan  Agreement  shall be to the
Loan Agreement as amended by this First Amendment.

         12.  This  First  Amendment  shall be  binding  upon  and  inure to the
benefit of the Parties and their respective successors and assigns.

         13.  Time is strictly of the essence of this First  Amendment  and full
and complete performance of each and every provision hereof.

         14.  This  First  Amendment  constitutes  the entire  agreement  of the
Parties  with  respect to the  subject  matter  hereof and cannot be modified or
amended except in writing signed by the Parties hereto.

         15.  This  First  Amendment  shall be  governed  by and  construed  and
enforced  in  accordance  with the laws of the State of New York  applicable  to
agreements made and to be performed wholly within such State.

         16.  This First  Amendment  may be executed  in multiple  counterparts,
which shall be deemed an original and all of which together will  constitute one
and the same instrument.

         17.  This First Amendment may be executed by facsimile  signature page.
Each party agrees to be bound by its own facsimile  signature page hereto and to
accept the facsimile  signature page hereto of any other Party,  in each case as
if each such facsimile  signature page were a manually executed  signature page;
provided  each Party shall  promptly  thereafter  deliver its original  manually
executed signature page.

              [The remainder of this page left blank intentionally.]

                                       5
<PAGE>


         IN WITNESS WHEREOF,  the Parties have caused this First Amendment to be
duly executed and delivered as of the Effective Date.


                          DAVIDSON KEMPNER SERVICE
                          COMPANY, LLC, as Agent and Collateral Agent

                          By:  M.H. Davidson & Co.,
                               Managing Member


                               By:  ____________________________
                                    Name: Thomas L. Kempner, Jr.
                                    Title: General Partner



                          ATLANTIC GULF COMMUNITIES CORPORATION,
                          on behalf of itself and,  with
                          respect to Sections 8 AND 10 only, the Entities listed
                          on Exhibit A hereto


                          By:      ____________________________________
                          Name:    ____________________________________
                          Title:   ____________________________________

<PAGE>

                                    EXHIBIT A


1.       AG Sanctuary of Orlando, Inc. (Florida)
2.       AG Title Corporation (Florida)
3.       AG-NTC, Inc. (Florida)
4.       AGC CL Limited Partner, Inc.  (Florida)
5.       AGC Homes, Inc. (Florida)
6.       AGC Sanctuary Corporation (Florida)
7.       AGC-SP, Inc. (Delaware)
8.       AGC-SP4, Inc. (Florida)
9.       AGC-SP5, Inc. (Florida)
10.      Atlantic Gulf C.C.  Corp.  (Florida) - f/k/a C.C.  Village  Development
         Corporation
11.      Atlantic Gulf Commercial Realty, Inc. (Florida)
12.      Atlantic Gulf Communities Management Corporation (Florida)
13.      Atlantic Gulf Communities Service Corporation (Florida)
14.      Atlantic Gulf Development, Inc. (Florida)
15.      Atlantic Gulf Engineering Company (Florida)
16.      Atlantic Gulf of Tampa, Inc. (Florida)
17.      Atlantic Gulf Realty, Inc. (Florida)
18.      Atlantic Gulf Receivables Corporation (Florida)
19.      Atlantic Gulfshore Natures Cove, Inc. (Florida)
20.      Atlantic Gulf Utilities, Inc. (Florida)
21.      Atlantic Gulf Water's Edge, Inc. (Florida)
22.      Community Title Agency, Inc. (Florida)
23.      [Intentionally Omitted]
24.      Cumberland Cove, Inc. (Tennessee)
25.      Environmental Quality Laboratory, Incorporated (Florida)
26.      EQL Environmental Services, Inc. (Florida)
27.      Five Star Homes, Inc. (Florida)
28.      Fox Creek Development Corporation (Florida)
29.      FRC Investments, Inc. (Florida)
30.      GDV Financial  Corporation (Florida)
31.      General Development Acceptance Corporation (Delaware)
32.      General Development Air Service, Inc. (Florida)
33.      General Development Commercial Credit Corp. (Florida)
34.      General Development Headquarters Corp. (Florida)
35.      General Development Resorts, Inc. (Florida)
36.      General Development Sales Corporation (Florida)
37.      General Development Service Corporation (Florida)
38.      General Development Utilities, Inc. (Florida)
39.      Grand Oaks Development Corporation (Florida)
40.      Grand Oaks Holding Company (Florida)
41.      Hunter Trace Development Corporation (Florida)
42.      Lakeside Development of Orlando, Inc. (Florida)
43.      Las Olas Tower at River Walk, Inc. (Florida) - f/k/a AGC-SP2, Inc.
44.      Longwood Utilities, Inc. (Florida)
45.      Maplewood Development Corporation (Florida)


                                      A-1

<PAGE>

46.      [Intentionally Omitted]
47.      [Intentionally Omitted]
48.      Ocean Grove, Inc. (Florida)
49.      Panther Creek Corp. (North Carolina)
50.      Regency Island Dunes, Inc. (Florida)
51.      Sabal Trace Development Corporation (Florida)
52.      Saxon-DeBary, Inc. (Florida)
53.      Spring Valley Acquisition Corp. (Colorado) - f/k/a Aspen Springs Valley
         Acquisition Corp.
54.      Spring  Valley  Holding  Company  (Florida) - f/k/a Aspen Springs Ranch
         Holding Company
55.      Spring Valley Development, Inc. (Colorado) - f/k/a Aspen Springs Ranch,
         Inc.
56.      Summerchase Development Corporation (Florida)
57.      Sunset Lakes Development Corporation (Florida)
58.      Town & Country II, Inc. (Florida)
59.      Waterford-Orlando, Inc. (Florida) f/k/a  AGC-SP1, Inc.
60.      West Bay Club  Development  Corporation  (Florida)  f/k/a Estero Pointe
         Development Corp.
61.      West Bay Holding Corporation (Florida)
62.      West Bay Realty, Inc. (Florida)
63.      West Frisco Development Corporation (Florida) - f/k/a AGC-SP3, Inc.
64.      Windsor Palms Corporation (Florida)
65.      XYZ Insurance, Inc. (Florida)
66.      Atlantic Gulf Asia Holdings N.V. (Netherlands Antilles)

                                      A-2