<PAGE>   1
                                                                   EXHIBIT 10.38

                                CONTRACT OF SALE


         This Agreement is entered into by and between LEE R. ROPER ("Seller")
and SILVERLEAF RESORTS, INC.  ("Purchaser").

                             W I T N E S S E T H :

         FOR AND IN CONSIDERATION of the promises, undertakings, and mutual
covenants of the parties herein set forth, Seller hereby agrees to sell and
Purchaser hereby agrees to purchase and pay for all that certain property
hereinafter described in accordance with the following terms and conditions:

                                   ARTICLE I

                                    PROPERTY

         The conveyance by Seller to Purchaser shall be of all the following:

         A.      The following described real property, together with all
right, title and interest of Seller in and to any all strips or gores, roads,
easements, streets, and ways bounding said property, and all rights of ingress
and egress thereto, and shall include all improvements and fixtures located or
to be located on said property:

                 46.3286 acres, more or less, located in Canyon Lake, Comal
                 County, Texas, and being depicted in Exhibit "A" attached
                 hereto and made a part hereof for all purposes.

         B.      The following described personal property individually owned
by Seller and currently located on the 46.3286 acres described in paragraph A
above and as further described and depicted in Exhibit "B":

                 2 shed rows with 7 stalls
                 1 shed row with 3 stalls
                 2 hot walkers
                 1 wash rack
                 12 outer stalls with moveable fence panels
                 rubber mats for concrete floors in stall barn
                 2 travel trailers.

Hereafter the aforesaid real and personal property are referred to collectively
as the "Subject Property."
<PAGE>   2
                                   ARTICLE II

                                 PURCHASE PRICE

         The purchase price to be paid by Purchaser to Seller for the Subject
Property shall be the sum of Two Hundred Eighteen Thousand and No/100 Dollars
($218,000.00).  The purchase price shall be payable all in cash at the closing.

                                  ARTICLE III

                                 EARNEST MONEY

         Within two (2) business days after final execution of this Contract by
all parties hereto, Purchaser shall deliver Purchaser's check in the amount of
Ten Thousand and No/100 Dollars ($10,000.00) to Safeco Land Title of Dallas,
5220 Renaissance Tower, 1201 Elm Street, Dallas, Texas  75270, Attn:  Bobbie
Irwin (the "Title Company").  The Title Company shall immediately cash the
earnest money check and deposit the proceeds thereof in an interest bearing
account, the earnings from which shall accrue to the benefit of Purchaser
(hereinafter the proceeds of the earnest money check shall be referred to as
the "earnest money").

         In the event that this Contract is closed, then the earnest money
shall be applied as a credit toward payment of the purchase price.  In the
event that this Contract is not closed, then the earnest money shall be
disbursed in the manner provided for elsewhere herein.  Notwithstanding the
foregoing or anything to the contrary contained elsewhere in this Contract, it
is understood and agreed that One Hundred Dollars ($100.00) of the earnest
money shall in all events be delivered to Seller as valuable consideration for
the Inspection Period described in Article VI hereinbelow and the execution of
this Contract by Seller.

                                   ARTICLE IV

                       PRE-CLOSING OBLIGATIONS OF SELLER

         Within thirty (30) days from the date of execution of this Contract,
Seller shall furnish to Purchaser, each of the following (collectively, the
"Due Diligence Items"):

                 a.       An updated survey of the Subject Property dated
         subsequent to the date of execution of this Contract and prepared by a
         licensed professional engineer or surveyor acceptable to Purchaser,
         which Survey shall:  (a) include a metes and bounds legal description
         of the Subject Property; (b) accurately show all improvements,
         encroachments


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<PAGE>   3
         and uses and accurately show all easements and encumbrances visible or
         listed on the Title Commitment (identifying each by recording
         reference if applicable); (c) recite the number of acres included in
         the Subject Property; (d) state whether the Subject Property (or any
         portion thereof) lies within a flood zone, or flood prone area; (e)
         contain a certificate verifying that the Survey was made on the
         ground, that the Survey is correct, that there are no improvements,
         encroachments, easements, uses or encumbrances except as shown on the
         survey plat, that the area represented for the Subject Property has
         been certified by the surveyor as being correct, that the Subject
         Property does not lie within any flood zone or flood prone area,
         except as indicated thereon; (f) constitute a category 1A Condition II
         Land Title Survey pursuant to the Texas Surveyor's Association Manual
         of Practice for Land Surveying in Texas, Revised Seventh Ed. (1988);
         and (g) otherwise be in form sufficient for the amendment of the
         boundary exception by the Title Company.  Unless otherwise agreed by
         Seller and Purchaser, the metes and bounds description contained in
         the Survey shall be the legal description employed in the documents of
         conveyance of the Subject Property;

                 b.       A current commitment (the "Title Commitment") for the
         issuance of an owner's policy of title insurance to the Purchaser from
         the Title Company, together with good and legible copies of all
         documents constituting exceptions to Seller's title as reflected in
         the Title Commitment; and

                 c.       All information of any kind whatsoever in the
         possession of Seller concerning possible development of the Subject
         Property including, but not limited to, any and all plans for the
         development of the Subject Property, any engineering studies of the
         Subject Property, and information relating to obtaining the approval
         of local governing bodies for the development of the Subject Property,
         any information as to when construction on the Subject Property may
         commence, any information regarding present or future zoning of the
         Subject Property, and any information concerning the availability of
         the utilities.


                                   ARTICLE V

                            TITLE INSPECTION PERIOD

         Purchaser shall have a period of sixty (60) days following the date on
which Purchaser receives the last of the items to be provided to Purchaser
pursuant to subparagraphs (a) and (b) of Article IV hereinabove in which to
review and approve each such item (the "Title Review Period").  If the
information to be provided pursuant to subparagraphs (a) and (b) of Article IV
reflect or discloses any defect, exception or other matter affecting the
Subject Property ("Title Defects") that is unacceptable to Purchaser, then
prior to the expiration of the Title Review Period Purchaser shall provide
Seller with written notice of Purchaser's objections.  Seller may, at its sole
option, elect to cure or remove the objections raised by Purchaser; provided,
however, that Seller shall have no obligation to do so.  Should Seller elect to
attempt to cure or remove the objections, Seller shall have ten (10) days from
the date of Purchaser's written notice of objections (the "Cure Period") in
which to accomplish the cure.  In the event Seller either elects





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<PAGE>   4
not to cure or remove the objections or is unable to accomplish the cure prior
to the expiration of the Cure Period, then Seller shall so notify Purchaser in
writing specifying which objections Seller does not intend to cure, and then
Purchaser shall be entitled, as Purchaser's sole and exclusive remedies, either
to terminate this Agreement by providing written notice of termination to
Seller within ten (10) days from the date on which Purchaser receives Seller's
no-cure notice or waive the objections and close this transaction as otherwise
contemplated herein.  If Purchaser shall fail to notify Seller in writing of
any objections to the state of Seller's title to the Subject Property as shown
by the Survey and Title Commitment, then Purchaser shall be deemed to have no
objections to the state of Seller's title to the Subject Property as shown by
the Survey and Title Commitment, and any exceptions to Seller's title which
have not been objected to by Purchaser and which are shown on the Survey or
described in the Title Commitment shall be considered to be "Permitted
Exceptions."  It is further understood and agreed that any Title Defects which
have been objected to by Purchaser and which are subsequently waived by
Purchaser shall be Permitted Exceptions.

                                   ARTICLE VI

                               INSPECTION PERIOD

         Purchaser, at Purchaser's sole expense, shall have the right to
conduct a feasibility, environmental, engineering and physical study of the
Subject Property for a period of time commencing on the date of execution of
this Contract and expiring sixty (60) days from the date on which Purchaser
receives the last of the items to be provided to Purchaser pursuant to Article
IV hereinabove (the "Inspection Period").  Purchaser and Purchaser's duly
authorized agents or representatives shall be permitted to enter upon the
Subject Property at all reasonable times during the Inspection Period in order
to conduct engineering studies, soil tests and any other inspections and/or
tests that Purchaser may deem necessary or advisable.  Purchaser further agrees
to indemnify and hold Seller harmless from any claims or damages, including all
reasonable attorneys' fees, resulting from Purchaser's inspection of the
Subject Property.  In the event that the review and/or inspection conducted by
this paragraph shows any fact, matter or condition to exist with respect to the
Subject Property that is unacceptable to Purchaser, in





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Purchaser's sole discretion, or if for any reason Purchaser determines that
purchase of the Subject Property is not feasible, then Purchaser shall be
entitled, as Purchaser's sole remedy, to cancel this Contract by providing
written notice of cancellation to Seller prior to the expiration of the
Inspection Period.  If Purchaser shall provide written notice of cancellation
prior to the expiration of the Inspection Period, then this Contract shall be
cancelled, all earnest money (less $100.00) shall be immediately returned to
Purchaser by the Title Company, and thereafter neither Seller nor Purchaser
shall have any continuing obligations one unto the other.

                                  ARTICLE VII

              REPRESENTATIONS, WARRANTIES, AND COVENANTS OF SELLER

         Seller represents and warrants to Purchaser that Seller will have at
closing good and indefeasible fee simple title to the Subject Property free and
clear of all liens, encumbrances, covenants, restrictions, rights-of-way,
easements, and any other matters affecting title to the Subject Property except
for the Permitted Exceptions.

         Seller further covenants and agrees with Purchaser that, from the date
hereof until the closing, Seller shall not sell, assign, or convey any right,
title, or interest whatsoever in or to the Subject Property, or create or
permit to exist any lien, security interest, easement, encumbrance, charge, or
condition affecting the Subject Property (other than the Permitted Exceptions)
without promptly discharging the same prior to closing.

         Seller hereby further represents and warrants to Purchaser, to the
best of Seller's knowledge, as follows:

                 a.       There are no actions, suits, or proceedings pending
         or, to the best of Seller's knowledge, threatened against Seller or
         otherwise affecting any portion of the Subject Property, at law or in
         equity, or before or by any federal, state, municipal, or other
         governmental court, department, commission, board, bureau, agency, or
         instrumentality, domestic or foreign;

                 b.       The execution by Seller of this Contract and the
         consummation by Seller of the sale contemplated hereby have been duly
         authorized, and do not, and, at the closing date, will not, result in
         a breach of any of the terms or provisions of, or constitute a default
         under any indenture, agreement, instrument, or obligation to which
         Seller is a party or by which the Subject Property or any portion
         thereof is bound, and do not, and at the closing date will not,
         constitute a violation of any regulation affecting the Subject
         Property; and





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                 c.       Seller has not received any notice of any violation
         of any ordinance, regulation, law, or statute of any governmental
         agency pertaining to the Subject Property or any portion thereof.

All of the foregoing representations and warranties of Seller are made by
Seller both as of the date hereof and as of the date of the closing hereunder.
Notwithstanding the foregoing, or anything to the contrary contained herein, it
is understood and agreed that the representations and warranties set forth
hereinabove shall survive the closing of this Contract only for a period of two
(2) years following the closing date, but not thereafter, and Seller shall have
no liability of any kind whatsoever for any breach thereof except to the extent
a claim is asserted against Seller within such two (2) year period.  If any
representations and warranties set forth herein are determined at any time on
or before the date of closing to be untrue or unfulfilled, then Purchaser, as
Purchaser's sole and exclusive remedy, may terminate this Contract by providing
written notice of such termination to Seller, in which event the earnest money
(less $100.00) shall be returned to Purchaser and thereafter neither Seller nor
Purchaser shall have any further liabilities or obligations one unto the other.

                                  ARTICLE VIII

                        CONDITIONS PRECEDENT TO CLOSING

         The obligation of Purchaser to close this Contract shall, at the
option of Purchaser, be subject to the following conditions precedent:

                 a.       All of the representations, warranties and agreements
         of Seller set forth in this Contract shall be true and correct in all
         material respects as of the date hereof and at closing, and Seller
         shall not have on or prior to closing, failed to meet, comply with or
         perform in any material respect any conditions or agreements on
         Seller's part as required by the terms of this Contract;

                 b.       There shall be no change in the matters reflected in
         the Title Commitment, and there shall not exist any encumbrance or
         title defect affecting the Subject Property not described in the Title
         Commitment except for the Permitted Exceptions;

                 c.       There shall be no changes in the matters reflected in
         the Survey, and there shall not exist any easement, right-of-way,
         encroachment, waterway, pond, flood plain, conflict or protrusion with
         respect to the Subject Property not shown on the Survey; and

                 d.       No material and substantial change shall have
         occurred with respect to the Subject Property which would in any way
         affect the findings made in the inspection of the Subject Property
         described in Article VI hereinabove.





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         If any such condition is not fully satisfied by closing, Purchaser may
terminate this Contract by written notice to Seller whereupon this Contract
shall be cancelled, the earnest money deposit (less $100.00) shall be returned
to Purchaser by the Title Company and thereafter neither Seller nor Purchaser
shall have any continuing obligations one unto the other.

                                   ARTICLE IX

                                    CLOSING

         The closing hereunder shall take place at the offices of the Title
Company.  The closing shall occur on the same day as the closing of that
certain Contract of Sale dated December 3, 1997, by and between Jimmy Polley
and Edith R. Smith, as seller, and Lee Roper, as purchaser (the "Smith
Contract").

                                   ARTICLE X

                        SELLER'S OBLIGATIONS AT CLOSING

         At the closing, Seller shall do the following:

                 a.       Deliver to Purchaser a Special Warranty Deed covering
         the real property described in Exhibit "A," duly signed and
         acknowledged by Seller, which deed shall be in form reasonably
         acceptable to Purchaser for recording and shall convey to Purchaser
         good and marketable title to the Subject Property, free and clear of
         all liens, rights-of-way, easements, and other matters affecting title
         to the Subject Property, except for the Permitted Exceptions.

                 b.       Deliver a bill of sale in form reasonably acceptable
         to Purchaser, duly executed by Seller, conveying and/or assigning to
         Purchaser the personal property described in Exhibit "B."

                 c.       Deliver or cause to be delivered to Purchaser an
         Owner Policy of Title Insurance (the "Title Policy") covering the
         Subject Property, in the amount of the purchase price, in the form
         prescribed by the Texas State Board of Insurance.  Such Title Policy
         may contain as exceptions only the Permitted Exceptions and the
         standard printed exceptions except that:  (i) the exception relating
         to restrictions against the Subject Property shall be deleted, except
         for such restrictions as may be included in the Permitted Exceptions;
         (ii) the exception relating to discrepancies, conflicts, or shortages
         in area or boundary lines, or any encroachment or overlapping of
         improvements which a survey might show shall be deleted except for
         shortages in area; and (iii) the exception relating to standby fees
         and ad valorem taxes shall except only to taxes owing for the current
         year and subsequent assessments for prior years due to change in land
         usage or ownership.  The premium charged by the Title Company for the
         Title Policy shall be paid by Purchaser.

                 d.       Deliver such evidence or other documents that may be
         reasonably required by the Title Company evidencing the status and
         capacity of Seller and the authority of





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<PAGE>   8
         the person or persons who are executing the various documents on
         behalf of Seller in connection with the sale of the Subject Property.

                 e.       Deliver a non-withholding statement that will satisfy
         the requirements of Section 1445 of the Internal Revenue Code so that
         Purchaser is not required to withhold any portion of the purchase
         price for payment to the Internal Revenue Service.


                                   ARTICLE XI

                       PURCHASER'S OBLIGATIONS AT CLOSING

         At the closing, Purchaser shall deliver to Seller the purchase price
for the Subject Property in cash.

                                  ARTICLE XII

                             COSTS AND ADJUSTMENTS

         At closing, the following items shall be adjusted or prorated between
Seller and Purchaser:

                 a.       Ad valorem taxes for the Subject Property for the
         current calendar year shall be prorated as of the date of closing, and
         Seller shall pay to Purchaser in cash at closing Seller's prorata
         portion of such taxes.  Seller's prorata portion of such taxes shall
         be based upon taxes actually assessed for the current calendar year.

                 b.       All other closing costs, including but not limited
         to, recording and escrow fees shall be divided equally between Seller
         and Purchaser; provided, however, that Seller and Purchaser shall each
         be responsible for the fees and expenses of their respective
         attorneys.

         Seller agrees to indemnify and hold Purchaser harmless of and from any
and all liabilities, claims, demands, suits, and judgments, of any kind or
nature (except those items which under the terms of this Contract specifically
become the obligation of Purchaser), brought by third parties and based on
events occurring on or before the date of closing and which are in any way
related to the ownership, maintenance, or operation of the Subject Property,
and all expenses related thereto, including, but not limited to, court costs
and attorneys' fees.

         Purchaser agrees to indemnify and hold Seller harmless of and from any
and all liabilities, claims, demands, suits, and judgments, of any kind or
nature, brought by third parties and based on events occurring subsequent to
the date of closing and which are in any way related to the ownership,
maintenance or operation of the Subject Property, and all expenses related
thereto, including, but not limited to, court costs and attorneys' fees.





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                                  ARTICLE XIII

                               ENTRY ON PROPERTY

         Purchaser, Purchaser's agents, employees, servants, or nominees, are
hereby granted the right to enter upon the Subject Property at any reasonable
time (after first notifying Edith R. Smith) prior to closing for the purpose of
inspecting the Subject Property and conducting such engineering and mechanical
tests as Purchaser may deem necessary or advisable, any such inspections and
tests to be made at Purchaser's sole expense.  Purchaser agrees to indemnify
and hold Seller harmless from and against any and all losses, damages, costs,
or expenses incurred by Seller as a result of any inspections or tests made by
Purchaser.

                                  ARTICLE XIV

                             POSSESSION OF PROPERTY

         Possession of the Subject Property free and clear of all uses and
encroachments, except the Permitted Exceptions, shall be delivered to Purchaser
at closing.

                                   ARTICLE XV

                                    NOTICES

         All notices, demands, or other communications of any type given by the
Seller to the Purchaser, or by the Purchaser to the Seller, whether required by
this Contract or in any way related to the transaction contracted for herein,
shall be void and of no effect unless given in accordance with the provisions
of this paragraph.  All notices shall be in writing and delivered to the person
to whom the notice is directed, either in person, by facsimile transmission, or
by United States Mail, as a registered or certified item, return receipt
requested.  Notices delivered by mail shall be deemed given when deposited in a
post office or other depository under the care or custody of the United States
Postal Service, enclosed in a wrapper with proper postage affixed, addressed as
follows:

         Seller:                  Lee R. Roper
                                  P.O. Box 2202
                                  Canyon Lake, Texas 78130-2202
                                  Telephone No.:  (830) 935-2807
                                  Facsimile No.:  (830) 935-2729





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<PAGE>   10
         Purchaser:               Silverleaf Resorts, Inc.
                                  1221 Riverbend Drive, Suite 120
                                  Dallas, Texas  75202
                                  Telephone No.:  (214) 631-1166
                                  Facsimile No.:  (214) 905-0514

         With a copy to:          Meadows, Owens, Collier, Reed, Cousins &
                                  Blau, L.L.P.
                                  901 Main Street, Suite 3700
                                  Dallas, Texas  75202
                                  Attn:  George R. Bedell, Esq.
                                  Telephone No.:  (214) 744-3700
                                  Facsimile No.:  (214) 747-3732


                                  ARTICLE XVI

                                    REMEDIES

         In the event that Seller fails to timely comply with all conditions,
covenants and obligations of Seller hereunder, such failure shall be an event
of default and Purchaser shall have the option (i) to terminate this Contract
by providing written notice thereof to Seller, in which event the earnest money
(less $100.00) shall be returned immediately to Purchaser by the Title Company
and the parties hereto shall have no further liabilities or obligations one
unto the other; (ii) to waive any defect or requirement and close this
Contract; or (iii) sue Seller for specific performance; provided, however, that
in the event that Seller violates its obligations pursuant to this Contract and
the closing does not occur as a result thereof, Purchaser's right to obtain any
damages hereunder shall be limited to the recovery of Purchaser's out-of-pocket
expenses, and in no event shall Purchaser have the right to sue for any other
damages, including consequential damages, lost profits or punitive damages.

         In the event that Purchaser fails to timely comply with all
conditions, covenants, and obligations Purchaser has hereunder, such failure
shall be an event of default, and Seller's sole remedy shall be to receive the
earnest money.  The earnest money is agreed upon by and between the Seller and
Purchaser as liquidated damages due to the difficulty and inconvenience of
ascertaining and measuring actual damages, and the uncertainty thereof, and no
other damages, rights, or remedies shall in any case be collectible,
enforceable, or available to the Seller other than in this paragraph defined,
and Seller shall accept the earnest money as Seller's total damages and relief.





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<PAGE>   11
                                  ARTICLE XVII

                                   ASSIGNMENT

         This Contract may be assigned by the Purchaser to any person, firm,
corporation or other entity which the Purchaser may, at its sole discretion,
chose, but only on condition that any such assignee must assume and agree to
perform all of Purchaser's obligations hereunder.  Purchaser shall promptly
provide Seller with written notice of any assignment made pursuant to this
paragraph.

                                 ARTICLE XVIII

                       INTERPRETATION AND APPLICABLE LAW

         This Agreement shall be construed and interpreted in accordance with
the laws of the State of Texas.  Where required for proper interpretation,
words in the singular shall include the plural; the masculine gender shall
include the neuter and the feminine, and vice versa.  The terms "successors and
assigns" shall include the heirs, administrators, executors, successors, and
assigns, as applicable, of any party hereto.

                                  ARTICLE XIX

                                   AMENDMENT

         This Contract may not be modified or amended, except by an agreement
in writing signed by the Seller and the Purchaser.  The parties may waive any
of the conditions contained herein or any of the obligations of the other party
hereunder, but any such waiver shall be effective only if in writing and signed
by the party waiving such conditions and obligations.

                                   ARTICLE XX

                                   AUTHORITY

         Each person executing this Contract warrants and represents that he is
fully authorized to do so.





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<PAGE>   12
                                  ARTICLE XXI

                                ATTORNEYS' FEES

         In the event it becomes necessary for either party to file a suit to
enforce this Contract or any provisions contained herein, the prevailing party
shall be entitled to recover, in addition to all other remedies or damages,
reasonable attorneys' fees and costs of court incurred in such suit.

                                  ARTICLE XXII

                              DESCRIPTIVE HEADINGS

         The descriptive headings of the several paragraphs contained in this
Contract are inserted for convenience only and shall not control or affect the
meaning or construction of any of the provisions hereof.

                                 ARTICLE XXIII

                                ENTIRE AGREEMENT

         This Contract (and the items to be furnished in accordance herewith)
constitutes the entire agreement between the parties pertaining to the subject
matter hereof and supersedes all prior and contemporaneous agreements and
understandings of the parties in connection therewith.  No representation,
warranty, covenant, agreement, or condition not expressed in this Contract
shall be binding upon the parties hereto or shall affect or be effective to
interpret, change, or restrict the provisions of this Contract.

                                  ARTICLE XXIV

                            MULTIPLE ORIGINALS ONLY

         Numerous copies of this Contract may be executed by the parties
hereto.  Each such executed copy shall have the full force and effect of an
original executed instrument.





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<PAGE>   13
                                  ARTICLE XXV

                                   ACCEPTANCE

         Seller shall have until 5:00 o'clock p.m., February 18, 1998, to
execute and return a fully executed original of this Contract to Purchaser,
otherwise this Contract shall become null and void.  Time is of the essence of
this Contract.  The date of execution of this Contract by Seller shall be the
date of execution of this Contract.  If the final date of any period falls upon
a Saturday, Sunday, or legal holiday under the laws of the State of Texas, then
in such event the expiration date of such period shall be extended to the next
day which is not a Saturday, Sunday, or legal holiday under the laws of the
State of Texas.

                                  ARTICLE XXVI

                             REAL ESTATE COMMISSION

         In the event that this Contract closes, but not otherwise, Purchaser
agrees to reimburse Seller with respect to the 10% real estate commission that
Seller is obligated to pay Rinco of Texas, Inc., in connection with the closing
of the Smith Contract.  Seller represents and warrants to Purchaser that Seller
has not contacted or entered into any agreement with any other real estate
broker, agent, finder, or any other party in connection with this transaction,
and that Seller has not taken any action which would result in any other real
estate broker's, finder's, or other fees or commissions being due and payable
to any other party with respect to the transaction contemplated hereby.
Purchaser hereby represents and warrants to Seller that Purchaser has not
contracted or entered into any agreement with any other real estate broker,
agent, finder, or any other party in connection with this transaction, and that
Purchaser has not taken any action which would result in any other real estate
broker's, finder's, or other fees or commissions being due or payable to any
other party with respect to the transaction contemplated hereby.  Each party
hereby indemnifies and agrees to hold the other party harmless from any loss,
liability, damage, cost, or expense (including reasonable attorneys' fees)
resulting to the other party by reason of a breach of the representation and
warranty made by such party herein.





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<PAGE>   14
Notwithstanding anything to the contrary contained herein, the indemnities set
forth in this Article XXVI shall survive the closing.

                                 ARTICLE XXVII

                              CONDITION PRECEDENT

         Notwithstanding anything to the contrary contained herein, it is
understood and agreed that Purchaser's obligation to purchase the Subject
Property pursuant to this Agreement is conditioned upon the closing of the
Smith Contract.  In the event that Seller is unable to close the Smith Contract
for any reason other than that caused by the Seller, then this Contract shall
automatically be cancelled, in which event all earnest money (less $100.00)
shall be immediately returned to Purchaser by the Title Company, and thereafter
neither Seller nor Purchaser shall have a continuing obligations one unto the
other.

         EXECUTED on this the 11th day of February, 1998.

                                  SELLER:
                                  


                                  /s/ LEE R. ROPER
                                  --------------------------------------------
                                  Lee R. Roper


         EXECUTED on this the 19th day of February, 1998.

                                  PURCHASER:
                                  

                                  SILVERLEAF RESORTS, INC. a Texas corporation


                                  By:/s/ ROBERT E. MEAD                   
                                     -----------------------------------------
                                  Name: Robert E. Mead                     
                                       ---------------------------------------
                                  Its:  CEO                                  
                                      ----------------------------------------





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<PAGE>   15
RECEIPT OF EARNEST MONEY AND ONE (1) EXECUTED COUNTERPART OF THIS CONTRACT IS
HEREBY ACKNOWLEDGED:

TITLE COMPANY:

SAFECO LAND TITLE OF DALLAS

By:                                         
   -----------------------------------------
Name:                                       
     ---------------------------------------
Its:                                        
    ----------------------------------------






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<PAGE>   16
                       LIST OF EXHIBITS TO EXHIBIT 10.38



Exhibit A                Copy of Land Survey

Exhibit B                Listing and Description of Personal Property



The above-listed exhibits are omitted from this filing. Registrant agrees to
furnish supplementally a copy of any omitted exhibit to the Commission upon
request.













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