Document:

EXHIBIT 10.137

                    FOURTH AMENDMENT TO AMENDED AND RESTATED
                           LOAN AND SECURITY AGREEMENT

     THIS FOURTH  AMENDMENT TO AMENDED AND RESTATED LOAN AND SECURITY  AGREEMENT
(this  "Amendment"),  dated as of October 16, 2001, among BLUEGREEN  CORPORATION
("Bluegreen"),  BLUEGREEN VACATIONS UNLIMITED,  INC. ("Vacations",  and together
with Bluegreen, the "Borrowers"), and HELLER FINANCIAL, INC., (together with its
successors and permitted assigns, the "Lender").

                                    RECITALS

     A. Lender and Borrowers are party to that certain Amended and Restated Loan
and  Security  Agreement  dated  as of June  30,  1999  (as  amended,  restated,
supplemented or otherwise modified from time to time, the "Loan Agreement").

     B. On and  subject  to the  terms and  conditions  hereof,  Borrowers  have
requested  from Lender,  and Lender is willing to grant,  certain  amendments to
certain provisions of the Loan Agreement,  all on terms and conditions set forth
herein.

     C. This Amendment shall constitute a Loan Document and these Recitals shall
be construed as part of this  Amendment;  capitalized  terms used herein without
definition  are so used as defined in the Appendix to the Loan  Agreement or the
Loan Agreement.

     NOW,  THEREFORE,  in consideration of the premises and the mutual covenants
hereinafter contained, the parties hereto agree as follows:

     1.   Amendment to Loan Agreement

          (a)  Section 1.1 of the Loan  Agreement is hereby  amended by deleting
               the  reference  to "October 16,  2001"  therein and  substituting
               therefor "February 16, 2002".

          (b)  The Appendix to the Loan  Agreement is hereby amended by deleting
               the following  definitions in their entirety and substituting the
               following new definitions in their place:

               Availability. At all times during the term of this Agreement, the
               lesser of (i) $15,000,000 minus outstanding  Advances, or (ii) an
               amount  equal  to  ninety-five  percent  (95%)  of the  principal
               balance of Pledged  Receivables;  provided  that with  respect to
               Aruba Receivables, such amount shall be eighty-five percent (85%)
               of the principal  balance of such Pledged  Receivables;  provided
               further  that from and after the date of this  Fourth  Amendment,
               Advances against new Pledged  Receivables shall not exceed ninety
               percent  (90%)  of the  principal  balance  of such  new  Pledged
               Receivables  (other than Aruba  Receivables)  and eighty  percent
               (80%) of the principal balance of new Aruba  Receivables.  In the
               event of a payment with respect to Pledged  Receivables  existing
               as of the date of this Fourth  Amendment,  Borrower  shall not be
               entitled to  Advances  against  such  Pledged  Receivables  in an
               amount in excess of 90% of the principal  balance of such Pledged
               Receivables  or with  respect  to Aruba  Receivables,  80% of the
               principal  balance  of such  Aruba  Receivables.  Notwithstanding
               anything to the contrary  contained  herein the

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               amounts  advanced  against  Pledged  Receivables  (i) relating to
               Eligible  Uncompleted  Unit  Receivables  shall  not at any  time
               represent in the aggregate more than the lesser of  $5,000,000.00
               or thirty percent (30%) of the aggregate  principal amount of all
               Advances  outstanding  under this  Agreement;  (ii)  relating  to
               Managed  Resorts shall not at any time represent in the aggregate
               more than  $2,000,000  of the aggregate  principal  amount of all
               Advances  outstanding  under this Agreement and (iii) relating to
               Aruba   Receivables  shall  not  exceed  on  a  cumulative  basis
               $6,000,000 of all Advances made under this  Agreement.  After the
               Maturity  Date or, at the  option of  Lender in  accordance  with
               Section 8.10,  after the occurrence and during the continuance of
               an Event of Default  hereunder,  Availability shall be zero ($0).
               At any time  Bluegreen  Corporation  ceases to own,  directly  or
               indirectly, at least fifity-one percent (51%) of the economic and
               voting interests of Bluegreen Properties, N.V., Availability with
               respect to Aruba Receivables shall be zero ($0).

               Interest  Rate. A floating  rate per annum equal to the Base Rate
               plus  3.5%  (the  aggregate  rate  referred  to as the  "Interest
               Rate").  "Base Rate" shall mean the rate  published each business
               day in The Wall Street Journal for deposits  maturing ninety (90)
               days  after  issuance  under the  caption  "Money  Rates,  London
               Interbank  Offered Rates  (LIBOR)" as the same may be fixed based
               upon the Interest  Rate  published  prior to and in effect on the
               first (1st) Business Day of such Fiscal Month.  Interest shall be
               calculated  based on a 360 day year and  charged  for the  actual
               number of days elapsed.

               Maturity Date. February 16, 2002.

               Maximum  Exposure.   The  lesser  of  (a)  $15,000,000,   or  (b)
               ninety-five percent (95%) of the outstanding principal balance of
               all  Pledged  Receivables;  provided  that with  respect to Aruba
               Receivables,  such amount shall be  eighty-five  percent (85%) of
               the outstanding  principal  balance of such Pledged  Receivables;
               provided  further  that from and  after  the date of this  Fourth
               Amendment,  Advances  against new Pledged  Receivables  shall not
               exceed ninety percent (90%) of the principal  balance of such new
               Pledged  Receivables  (other than Aruba  Receivables)  and eighty
               percent (80%) of the principal balance of new Aruba  Receivables.
               In the event of a payment  with  respect to  Pledged  Receivables
               existing as of the date of this Fourth amendment,  Borrower shall
               not be entitled to Advances  against such Pledged  Receivables in
               an  amount  in excess  of 90% of the  principal  balance  of such
               Pledged Receivables or with respect to Aruba Receivables,  80% of
               the principal balance of such Aruba Receivables.  Notwithstanding
               anything  to  the  contrary  contained  herein,  the  outstanding
               principal  amount of  Advances  made  with  respect  to  Eligible
               Uncompleted Unit Receivables shall not in the aggregate represent
               more than the lesser of $5,000,000 or thirty percent (30%) of the
               aggregate principal amount of Advances outstanding  hereunder and
               any such excess  shall  require a  prepayment  of the Loan or the
               pledge of Eligible  Receivables  consistent  with Section  1.7(b)
               hereof.

     2.   Amendment to Note

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          All  references  to the  Maturity  Date in the  Note  shall  refer  to
          February 16, 2002 and all  references to the Interest Rate in the Note
          shall refer to the Interest Rate as amended herein.

     3.   Representations and Warranties

          (a)  After  giving  effect  to this  Amendment  and  the  transactions
     contemplated  hereby (i) no Event of  Default  shall  have  occurred  or be
     continuing  and  (ii)  the  representations  and  warranties  of  Borrowers
     contained in the Loan Documents shall be true,  correct and complete in all
     material  respects on and as of such date to the same extent as though made
     on and as of such  date,  except to the  extent  such  representations  and
     warranties specifically relate to an earlier date

          (b) Borrowers  jointly and  severally  represent and warrant to Lender
     that the  execution,  delivery  and  performance  by each  Borrower of this
     Amendment and the other documents and transactions  contemplated hereby are
     within such Borrower's  corporate powers,  have been duly authorized by all
     necessary corporate action (including,  without  limitation,  all necessary
     shareholder  approval)  of  such  Borrower,  have  received  all  necessary
     governmental approvals, and do not and will not contravene or conflict with
     any  provision of law  applicable  to such  Borrower,  the  certificate  or
     articles  of  incorporation  or  bylaws  of such  Borrower,  or any  order,
     judgment  or  decree  of any court or other  agency  of  government  or any
     contractual obligation binding upon such Borrower; and this Amendment,  the
     Loan Agreement and each other Loan Document  constitutes  the legal,  valid
     and binding obligation of each Borrower  enforceable  against each Borrower
     in accordance with its terms.

     4.   Conditions  Precedent.  This  Amendment  shall become  effective  upon
          Lender's  receipt of the following  item and the  satisfaction  of the
          following  conditions,  as the case may be, all in form and  substance
          satisfactory to Lender.

          (a)  Documentation

               (i)  Amendment.  This  Amendment,  duly executed by each Borrower
                    and Lender.

               (ii) Secretary's Certificate;  Resolutions.  A certificate of the
                    Clerk,  Secretary,  an  Assistant  Clerk  or  and  Assistant
                    Secretary of each of the Borrowers  certifying (i) the names
                    and true signatures of the officers authorized on its behalf
                    to  sign  this   Amendment  (ii)  a  copy  of  such  party's
                    certificate or articles of  incorporation  and by-laws,  and
                    (iii) a copy of the resolutions of the board of directors of
                    such  party   approving   this  Amendment  and  the  related
                    transactions  to  which  it is a  party,  all  in  form  and
                    substance satisfactory to the Lender. Such certificate shall
                    state that the resolutions  thereby  certified have not been
                    amended,  modified,  revoked or  rescinded as of the date of
                    such certificate.

          (b)  No Event of Default.  No event of Default shall have occurred and
               be continuing, or would result after giving effect hereto.

<PAGE>

          (c)  Warranties    and    Representations.    The    warranties    and
               representations  of each Borrower contained in this Amendment and
               the  other  Loan  Documents  shall  be true  and  correct  in all
               material respects after giving effect hereto.

     5.   Effect on Loan  Documents.  This Amendments is limited to the specific
          purpose for which it is granted and, except as specifically  set forth
          above  (a)  shall  not be  construed  as a  consent,  waiver  or other
          notification with respect to any term, condition or other provision of
          any Loan Document and (b) each of the Loan  Documents  shall remain in
          full force and effect and are each hereby ratified and confirmed.

     6.   Successors and Assigns.  This Amendment  shall be binding on and shall
          inure  to the  benefit  of  Borrowers,  Lender  and  their  respective
          successors  and  assigns;  provided  that no  Borrower  may assign its
          rights,  obligations,  duties or other interest  hereunder without the
          prior  written  consent of Lender.  The terms and  provisions  of this
          Amendment  are for the purpose of  defining  the  relative  rights and
          obligations  of Borrowers and Lender with respect to the  transactions
          contemplated hereby and there shall be no third party beneficiaries or
          any of the terms and provisions of this Amendment.

     7.   Entire  Agreement.  This Amendment,  including all documents  attached
          hereto,  incorporated  by reference  herein or delivered in connection
          herewith, constitutes the entire agreement of the parties with respect
          to the subject matter hereof and supersedes all other  understandings,
          oral or written, with respect to the subject matter hereof.

     8.   Fees and Expenses. Borrower shall pay to Lender upon execution of this
          Amendment,   an  extension  fee  equal  to  $5,000.   Borrower  hereby
          authorizes Lender to charge the Loan for such fee.

     9.   Captions.  Section captions used in this Amendment are for convenience
          only, and shall not affect the construction of this Amendment.

     10.  Severability. Whenever possible each provision of this Amendment shall
          be  interpreted  in such  manner as to be  effected  and  valid  under
          applicable  law,  but if any  provision  of this  Amendment  shall  be
          prohibited  by or invalid  under  such law,  such  provision  shall be
          ineffective to the extent of such  prohibition or invalidity,  without
          invalidating   the  remainder  of  such  provision  or  the  remaining
          provisions of this Amendment.

     11.  Counterparts.  This  Amendments  may  be  executed  in any  number  of
          counterparts  and by the different  parties on separate  counterparts,
          and each such counterpart  shall be deemed to be an original,  but all
          such  counterparts  shall  together  constitute  but one and the  same
          instrument. Delivery of an executed counterpart of a signature page to
          this  Amendment  by  telecopy  shall be  effective  as  delivery  of a
          manually executed counterpart of this Amendment.

     12.  Payment upon Maturity Date. The parties hereto  acknowledge  and agree
          that  payment of the  Indebtedness  pursuant to Section  1.6(b) of the
          Loan Agreement shall not constitute a prepayment  under Section 1.7 of
          Loan Agreement.

                            [signature page follows]

<PAGE>

     IN WITNESS WHEREOF,  this Amendment has been duly executed and delivered as
     of the day and year first above written,

                                           BLUEGREEN CORPORATION
                                           By:      /S/ John F. Chiste
                                           Title:   Sr. V.P.,  and Treasurer

                                           BLUEGREEN VACATIONS UNLIMITED, INC.
                                           By:      /S/ Allan Herz
                                           Title:   Vice President

                                           HELLER FINANCIAL, INC.
                                           By:      /S/ Dennis Holland
                                           Title:   Sr. Vice PresidentEXHIBIT 10.142

                                                           CLCA Form REF No. 101
                                                                      (02/25/97)
Loan No.  52-1170000

                             BUILDING LOAN AGREEMENT

                               (Land Development)

                            Dated as of July 31, 2001

     JORDAN  LAKE  PRESERVE  CORPORATION,  a  North  Carolina  corporation  (the
"Borrower"),  and INDYMAC BANK, F.S.B. dba CONSTRUCTION  LENDING  CORPORATION OF
AMERICA (the "Lender"), agree as follows:

     1.00 Preliminary Statement. The Borrower owns the Land described in Exhibit
"A",  which  consists  of  approximately  597 acres,  and intends to develop and
improve the Land in  accordance  with the  Improvement  Plans  submitted  by the
Borrower to the Lender. In conjunction with the completion of such Improvements,
the  Borrower  intends  that the Land will be  developed  as 515 Lots in two (2)
phases, with at least 355 Lots in Phase I and at least 160 Lots in Phase II. The
development  of the Land and the Project  commenced  prior to the closing of the
Loan, with certain of the Lots within Phase I having been previously conveyed to
third party purchasers. Therefore, due to such prior conveyances, the Land shall
initially  include (i) the 170 Lots in Phase I of the Project which  continue to
be owned by Borrower;  and, (ii) all of the Land which shall constitute Phase II
of the  Project and the golf course and related  amenities  being  developed  by
Borrower  as a part of the  Project.  In  order  to  finance  the  Land  and the
construction of the  Improvements  and the payment of various costs and expenses
relating to the Project,  the Borrower has applied to the Lender for a revolving
line of credit Loan in the amount of up to $6,700,000.00, the repayment of which
will be secured by the Borrower's  interest in the Land and the Improvements and
the other Collateral covered by the Deed of Trust to be executed by the Borrower
in favor of the Lender.  The Lender is willing to make the Loan to the  Borrower
on the terms and conditions set forth in this Agreement.

     1.01 Type of Loan.  The Loan is structured as a revolving line of credit of
up to  $6,700,000.00.  Subject  to  compliance  by  Borrower  with  the  funding
requirements expressly set forth in this Agreement,  Borrower may repay the Loan
or  portions  thereof  and then  reborrow  from time to time  under such line of
credit hereby

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<PAGE>

established up to the maximum amount of  $6,700,000.00  which may be outstanding
at any one time; provided, however, notwithstanding anything in the foregoing to
the contrary,  the maximum amount which may be outstanding under the Loan at any
one time shall not exceed  the lesser of (i) fifty  percent  (50%) of the retail
value of Lots owned by Borrower  under  development or completed at any one time
as  determined by an appraiser  acceptable to Lender,  (ii) seventy five percent
(75%) of the "Discounted  Appraised  Value" of such Lots owned by Borrower under
development  or  completed  at  any  one  time  as  determined  by an  appraiser
acceptable  to Lender or, (iii)  seventy  five percent  (75%) of the total costs
incurred by Borrower pursuant to the Project Budget. As used herein  "Discounted
Appraised  Value" means the estimated  amount a single investor would be willing
to pay for all of such Lots owned by Borrower under  development or completed at
any one time upon the full development of such Lots when purchasing such Lots in
bulk;  that is, all at one time.  Subject to the foregoing  maximum amount which
may be outstanding under the Loan at any one time and compliance with all of the
other  terms and  provisions  of this  Agreement  and the other Loan  Documents,
Lender has committed the sum under the Loan as shown in the Project  Budget,  as
the same may be  modified  from time to time,  over the two (2) year term of the
Loan,  provided  the second  installment  of the Loan Fee is timely  received by
Lender as necessary to extend the initial one (1) year term of the Loan.

     Capitalized terms used in this Agreement and not otherwise defined are used
with the meanings set forth in Exhibit "F".

     2.00 Documentation.  Prior to the first Disbursement of the proceeds of the
Loan  requested  by the  Borrower,  the  Borrower  shall  deliver or cause to be
delivered to the Lender, in form and substance  satisfactory to the Lender,  the
Loan Documents and other  "Required  Items"  specified in Exhibit "C",  together
with such other  Documents  and  information  relating  to any Loan  Party,  the
Collateral,  the Project or the transactions  contemplated by the Loan Documents
as the Lender may reasonably request.

     3.00  Disbursements.  Subject to the terms,  conditions  and procedures set
forth in this Agreement and in the "Disbursement  Schedule"  attached as Exhibit
"B", the Lender shall make  Disbursements  to or for the account of the Borrower
from time to time from the date of this Agreement to the Banking Day immediately
preceding the Maturity Date. The aggregate amount of all  Disbursements  made by
the Lender  shall not exceed the amount  committed  by Lender  under the Loan as
shown in the Project Budget, as the same may be modified from time to time, plus
the amount of any "Borrower's  Funds"  deposited with the Lender pursuant to the
Disbursement  Schedule.  All  Disbursements of the proceeds of the Loan shall be
evidenced by and repayable in accordance with the terms of the Note.

     4.00  Covenants of the Borrower.  Unless the Lender  otherwise  consents in
writing:

     4.01 Construction of Improvements. The construction of the Improvements has
commenced and

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<PAGE>

Borrower shall cause the construction  thereof to be diligently and continuously
prosecuted to  completion,  subject in each case to the following  requirements:
(a) the  Improvements  shall be constructed in substantial  conformity  with the
Improvement Plans and in compliance in all material respects with all applicable
Laws and  Other  Requirements,  and in a good and  workmanlike  manner  with new
materials  of  good  quality;  (b)  except  as  otherwise  contemplated  by  the
Improvement  Plans with  respect to any "Site  Development"  referred  to in the
Project Budget, the Improvements  shall be constructed  entirely on the Land and
shall not encroach upon or overhang any lot line, boundary,  set-back, easement,
right-of-way or other land; (c)  construction of the  Improvements  shall in any
event be completed on or before the Maturity Date;  and (d) the Borrower  hereby
covenants  and agrees,  on behalf of itself and any of its  affiliates,  that no
such Person shall  construct,  create,  arrange,  develop,  purchase or sell any
residential building lots which constitute a Competing Project.

     If at any time the Lender  notifies the Borrower that  construction  of the
Improvements  does not conform to the  requirements  of this Section 4.01 or any
such nonconformity is otherwise  discovered by the Borrower,  the Borrower shall
immediately  cause  such  nonconforming  construction  to  be  stopped  and  all
necessary  corrective  work to be  commenced  and  diligently  and  continuously
prosecuted to completion.

     4.02 Change  Orders.  The Borrower shall not permit any Change Order to the
Improvement  Plans to be  implemented  without the prior approval of the Lender,
provided  that  this  Section  4.02  shall  not  prevent   routine   changes  in
construction which would not cause the Improvements to fail to be in substantial
conformity  with the  approved  Improvement  Plans and  which are not  otherwise
material in the aggregate.

     4.03  Compliance with Laws and Other  Requirements.  The Borrower shall (a)
comply in all material respects with all applicable Laws and Other  Requirements
relating to the  Collateral  or the  Project,  and (b) obtain and  maintain  all
Authorizations required in connection with the Collateral or the Project.

     4.04 Project Agreements.  The Borrower shall (a) take all action reasonably
necessary or appropriate to maintain and enforce its rights and interests  under
each  of  the  Project  Agreements   (including  the  Engineer  Agreement,   the
Construction  Contract,  if any, and any other contract  entered intoby Borrower
relative to the development of the Project), (b) comply in all material respects
with its  obligations  under each of the Project  Agreements,  (c) not permit or
agree to any supplement,  modification,  amendment or termination of, or consent
or agree to any waiver of or  departure  from the terms of,  any of the  Project
Agreements, and (d) not transfer, encumber or release any interest in, or commit
or permit any material breach or default on the part of the Borrower under,  any
of the  Project  Agreements,  except  that so long as no  Event of  Default  has
occurred and is continuing, this Section 4.04 shall not apply to (i) any failure
of the Borrower to comply with such  requirements  which in the  aggregate  does
not,  and in the  reasonable  judgment of the  Borrower and the Lender will not,
materially  impair the Borrower's  ability to perform its Obligations  under the
Loan Documents,  (ii) any amendment of the Engineer Agreement,  the Construction
Contract,  if any, and any other contract  entered into

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<PAGE>

by Borrower relative to the development of the Project to incorporate any Change
Orders  which are  permitted to be  implemented  by Section  4.02,  or (iii) the
termination of any Project Agreement as a result of a material breach or default
by the other party.

     4.05   Collateral.   The  Borrower  shall  take  all  action  necessary  or
appropriate  from time to time to maintain the Deed of Trust as an  indefeasible
first priority perfected Lien in the Collateral,  and shall not at any time part
with  possession  of or  abandon  any of the  Collateral  or cause or permit any
interest in any of the Collateral to be sold, transferred,  leased,  encumbered,
released,  relinquished  or  otherwise  disposed  of  (whether  voluntarily,  by
operation  of law or  otherwise),  provided  that:  (a) so long as no  Event  of
Default  has  occurred  and is  continuing  and  receipt  by the  Lender  of the
applicable  "Release  Price"  set  forth  in  Exhibit  "E"  and  payment  of all
applicable  costs,  fees and  expenses,  (i) the  Borrower  may sell Lots in the
ordinary   course  of  business  and  transfer  common  areas  to  a  homeowners
association if and when required by applicable Laws or Other Requirements,  (ii)
the Lender  shall  release Lots and common areas or interests in common areas so
sold or  transferred  from the Lien of the Deed of Trust and (iii) the  Borrower
may, in the ordinary course of business, receive, hold and dispose of any excess
proceeds  resulting  from the sale of any Lot after  payment  of the  applicable
"Release  Price";  and (b) the  requirements of this sentence shall not prohibit
(1)  the  creation  or  existence  of  any  Permitted  Exceptions  or  Permitted
Transfers,  or (2) any action  with  respect to any  Project  Agreements  to the
extent  permitted  by  Section  4.04.  Releases  hereunder  by  Lender  shall be
accomplished  by  utilization  of release deeds in the form  attached  hereto as
Exhibit "H" and incorporated herein by this reference. Lender commits to execute
and return release deeds to Borrower's  counsel  releasing Lots from the Lien of
the Deed of Trust within four (4) weeks after receipt of the applicable "Release
Price" and the completed release deed from Borrower's counsel.

     The amount of any "Release  Price"  received by the Lender shall be applied
to the principal of the Note, provided that if such amount exceeds the principal
of the Note then  outstanding,  the excess shall be held by the Lender in a Cash
Collateral  Account and thereafter applied by the Lender (A) so long as no Event
of Default has occurred and is continuing, to future advances of principal under
the Note as and when made,  or (B) if an Event of Default  has  occurred  and is
continuing,  to any Obligations of the Borrower under the Loan Documents at such
time or times and in such manner as the Lender deems  appropriate.  Upon payment
in full of all Obligations of the Borrower and termination of all obligations of
the Lender under the Loan  Documents,  the Lender shall  release its interest in
any amounts then held in any such Cash Collateral Account.

     The  Borrower  shall at all times use its best  efforts  to market and sell
Lots in compliance with the terms of this Agreement.

     4.06 Personal Property. The Borrower shall not (a) install or otherwise use
or acquire for use in connection with the Collateral or the Project any Personal
Property  (including  replacement  Personal  Property

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<PAGE>

pursuant to clause  (iii)  below)  which is not owned by the  Borrower  free and
clear of all Liens  (including  conditional sale contracts) and Rights of Others
(other than Permitted  Exceptions) or which is not a part of the Collateral,  or
(b) cause or  permit  the  removal  from the Land  (or,  in the case of  offsite
improvements,  from the location of installation) of any Personal Property which
is  installed  or  otherwise  used or acquired  for use in  connection  with the
Collateral  or the  Project,  except  that so long as no  Event of  Default  has
occurred and is continuing, this clause (b) shall not prohibit (i) the temporary
removal of Personal  Property  for repairs in the  ordinary  course of business,
(ii) the  removal of  Personal  Property  of  insignificant  value  which is not
reasonably  necessary or appropriate to the completion of the Project,  or (iii)
the removal of  defective  Personal  Property  which has been  replaced by other
Personal  Property of equal or greater  suitability  and value which is intended
for the same purpose.  Upon removal of any Personal  Property in compliance with
clauses  (ii) and (iii) above,  the  Borrower  shall be permitted to transfer or
otherwise dispose of such Personal Property as the Borrower may determine.

     4.07 Liens and Taxes. The Borrower shall (a) pay, prior to delinquency, all
Taxes which are or may become a Lien  affecting any of the  Collateral,  and not
consent to any Special  Taxes which affect or may affect any of the  Collateral,
(b) keep the  Collateral  free and  clear of all Liens  and  Rights  of  Others,
subject  only to  Permitted  Exceptions  and  Permitted  Transfers  of  Personal
Property, (c) promptly pay or cause to be paid, and obtain valid and enforceable
lien releases or waivers  (together  with invoices or receipts  identifying  the
nature of each payment) from, all Lien  Claimants,  (d) take all other necessary
steps to forestall  the  assertion of Lien Claims,  and (e) pay and perform when
due all other obligations secured by or constituting a Lien affecting any of the
Collateral, except that the Borrower shall not be required to pay or perform any
such Taxes, Lien Claims or other obligations which are being actively  contested
in good faith by appropriate proceedings,  provided that the Borrower has posted
such security for the payment or performance of such Taxes, Lien Claims or other
obligations as the Lender may  reasonably  require and, by reason of nonpayment,
none of the  Collateral  or any Lien or other  interest of the Lender  under the
Loan Documents is prejudiced or in danger of being sold, foreclosed or otherwise
lost or forfeited.

     In the event that any action or other  proceeding  is instituted to enforce
any Lien (including any mechanics lien, and whether or not such Lien constitutes
a  Permitted  Exception)  against  any of the  Collateral,  the  Borrower  shall
immediately make such payments,  obtain such surety bonds and/or take such other
action as the Lender may reasonably  require in order to release the stop notice
or Lien. Upon failure of the Borrower to take any of the foregoing  actions in a
timely manner,  the Lender may, at its option,  file an  interpleader  action to
resolve any pending claims.

     The  Borrower  irrevocably  appoints  the Lender as its agent (such  agency
being  coupled  with an  interest)  to file any  notices  that the Lender  deems
appropriate in order to protect its interests under the Loan Documents.

                                      E-5
<PAGE>

     4.08  Property and  Liability  Insurance.  The Borrower  shall at all times
maintain the following policies of insurance:

          (a) commercial  general  liability  insurance in favor of the Borrower
     (and naming the Lender and its  subsidiaries  and  affiliates as additional
     insureds) in an aggregate  amount not less than $3,000,000 (or such greater
     amount as may be specified by the Lender from time to time) combined single
     limit;

          (b) with respect to any  Collateral  consisting of building  materials
     and supplies and other Personal Property and any improvements now or in the
     future located on the Land,  such  insurance  against loss or damage as the
     Lender may reasonably require from time to time; and

          (c)  such  other  insurance  as may be  required  by  applicable  Laws
     (including worker's  compensation and employer's liability insurance) or as
     the Lender may reasonably require from time to time.

     The  Borrower   shall  also  cause  the   Contractor,   if  any,  and  each
subcontractor  to maintain a policy of commercial  general  liability  insurance
and,  upon  request by the Lender,  shall cause the  Architect  and any engineer
engaged in  connection  with the  Project to  maintain a policy of  professional
liability  insurance,  in each case for such  periods and in such amounts as the
Lender may reasonably require from time to time.

     Any policy of property  insurance  required by clause (b) above shall be in
an amount not less than the full  replacement  cost of the  property  covered by
such policy,  shall contain a "full replacement cost" endorsement,  shall insure
against flood loss risk if the Land is located in a Flood Hazard Area, and shall
name the Lender and its  subsidiaries and affiliates as "loss payee" pursuant to
form BFU 438 or other form  approved  by the Lender.  Each policy of  commercial
general liability  insurance  required by this Section 4.08 shall cover personal
injury,  property  damage,   owner/contractor  protective,  blanket  contractual
liability  and  (where  applicable)  completed  operations,  with  x,  c  and  u
exclusions  deleted,  and such insurance  shall be primary and  non-contributing
with any other insurance  available to the Lender.  All insurance policies shall
be in form and substance and issued by insurers  reasonably  satisfactory to the
Lender,  and shall contain such deductibles and such  endorsements as the Lender
may  reasonably  require.  Upon  request  by the Lender  from time to time,  the
Borrower shall deliver to the Lender copies of all such  insurance  policies and
originals of certificates evidencing such policies.

     4.09 Title  Insurance  and  Searches.  The  Borrower  shall  deliver to the
Lender, in form and substance  satisfactory to the Lender,  such endorsements to
the Title  Policy and such  preliminary  title  reports  and other title or lien
searches  (including  UCC searches) and tax service  contracts as the Lender may
reasonably require from time to time; provided,  however, the Title Policy shall
be issued  to cover  all  future  advances  under  the Loan and shall  include a
revolving  credit  endorsement  and such  other  endorsements  as Lender and its
counsel may require.

                                      E-6
<PAGE>

     4.10  Books,  Records  and  Inspections.  The  Borrower  shall at all times
maintain (a) full and complete  books of account and other  records with respect
to the Collateral and the Project and its business and operations,  (b) complete
copies of the Improvement  Plans, all Project  Agreements and all Authorizations
issued in connection with the Collateral or the Project, and (c) a complete file
of all invoices, receipts and lien releases and waivers obtained by the Borrower
with respect to amounts paid for Project Costs,  and shall permit the Lender and
its  agents,  upon  request  from time to time,  to inspect and copy any of such
books,  records and other  Documents  and to enter and inspect the Real Property
and any other Collateral and all work and materials furnished in connection with
the Project.

     4.11  Construction  Information  and Reporting  Requirements.  The Borrower
shall cause to be delivered to the Lender,  in form and detail  satisfactory  to
the Lender:

          (a) promptly after  discovery by the Borrower,  notice of (i) any fact
     or  circumstance  that may or will cause the Project Costs  associated with
     any  Line  Item  in the  Project  Budget  to  exceed  or be less  than  the
     corresponding  amount set forth in the Project Budget attached as Exhibit D
     (excluding for this purpose any reference to Line Item Budget) by more than
     five  percent  (5%),  or that may or will cause any  Project  Costs for any
     matters  not  covered by  specific  Line  Items to exceed in the  aggregate
     $50,000.00,  (ii) any failure of the Project or the  Improvements  to be in
     substantial  conformity with the Improvement Plans and in compliance in all
     material  respects with all applicable Laws and Other  Requirements,  (iii)
     any actual or anticipated material delays in construction, (iv) any serious
     threat or the commencement of any action or other proceeding (including any
     action to foreclose  or otherwise  enforce any Lien Claim or other Lien and
     any proceedings in condemnation or eminent domain) affecting or relating to
     any of the  Collateral or the Project,  (v) the occurrence or allegation of
     any  termination,  material  breach or default,  or failure of any material
     condition or other  requirement under the Engineer  Agreement,  if any, the
     Construction  Contract,  if any,  or any  other  contract  entered  into by
     Borrower  relative  to the  development  of the  Project,  (vi) any dispute
     between the Borrower  and any  Governmental  Agency  relating to any of the
     Collateral  or the  Project,  the  adverse  determination  of  which  could
     adversely  affect the  Collateral  or the Project in any material  respect,
     (vii)  any  injury  or  damage  to or  loss  or  destruction  of any of the
     Collateral  if the  cost of  repair,  restoration  or  replacement  exceeds
     $25,000,  (viii) any  imposition of or proposal for any Special Taxes which
     affect or may  affect  any of the  Collateral,  (ix) any  material  adverse
     change in the financial condition,  operations,  properties or prospects of
     any Loan  Party,  (x) any event  which has or may have a  material  adverse
     impact on the Collateral or the Project or the ultimate development and use
     of the Real Property for its intended  purpose,  and (xi) the occurrence of
     any Event of Default or event which,  with the giving of notice  and/or the
     passage of time, could become an Event of Default;

                                      E-7
<PAGE>

          (b) promptly after receipt or  preparation by the Borrower,  copies of
     (i) all notices or other  communications  delivered  to the Borrower or the
     Real  Property  which  are  addressed  to the  Lender  or to  "construction
     lender",  and  (ii) on or  before  the 1st day of each  calendar  month,  a
     monthly Lot sales  report  setting  forth Lot sales for the prior  calendar
     month,  accompanied by copies of all Lot sales contracts  disclosed by such
     monthly Lot sales report and executed  subsequent  to the prior monthly Lot
     sales  report  and,  if  requested  by  Lender,  all  written  commitments,
     contracts  and formal  proposals  made by or to the  Borrower to  purchase,
     sell, refinance or further develop any Collateral;

          (c) as to  Borrower,  quarterly  Financial  Statements  certified in a
     manner  acceptable  to the  Lender  within  fifty five (55) days after each
     fiscal  quarter of Borrower and tax returns  within  thirty (30) days after
     their filing; provided, however, the delivery of such tax returns shall not
     be required so long as the Guarantor's  current  accounting  firm,  Ernst &
     Young,  continues its  unqualified  opinion of  Guarantor's  audited annual
     Financial Statements;

          (d) as to  Guarantor,  copies of all 10 - Q and 10 - K filings made by
     Guarantor in accordance with the requirements of the applicable  securities
     laws  relative  thereto  within ten (10) days after  such  filings  and tax
     returns within thirty (30) days after their filing; provided,  however, the
     delivery  of  such  tax  returns  shall  not be  required  so  long  as the
     Guarantor's   current  accounting  firm,  Ernst  &  Young,   continues  its
     unqualified opinion of Guarantor's audited annual Financial Statements ;

          (e) a monthly summary report of Project Lot sales and closings in form
     and content acceptable to Lender; and

          (f) such other  Documents or  information  relating to any Loan Party,
     the Collateral,  the Project or the  transactions  contemplated by the Loan
     Documents as the Lender may reasonably request from time to time.

     The  Lender is  authorized  at any time and from  time to time to  directly
contact the Contractor,  if any, or any  subcontractor or other Lien Claimant or
potential  Lien Claimant or other Person to verify any  information  provided by
the Borrower or for any other purpose.

     4.12 Costs, Fees and Expenses.  The Borrower shall bear sole responsibility
for and promptly pay or cause to be paid all costs and expenses  relating to the
performance by the Borrower of its  Obligations or the delivery to the Lender of
any Documents or other items or information  under or in connection  with any of
the Loan  Documents,  and any Taxes  (other  than income  taxes of the  Lender),
costs,  expenses,  fees or  charges  payable  or  determined  to be

                                      E-8
<PAGE>

payable in connection with the execution,  delivery,  filing or recording of, or
otherwise  with respect to, any Loan  Document or any other  Document  delivered
under or in connection with any Loan Document.

     The Borrower shall pay the initial  $74,391.50  installment of the Loan Fee
to the  Lender at or prior to the time of  recordation  of the Deed of Trust and
shall pay the second  installment of the Loan Fee in the amount of $74,391.50 to
the  Lender on the  first  anniversary  date of the  closing  of the Loan.  Such
initial  installment of the Loan Fee shall be disbursed by Lender to itself as a
part of the initial  Disbursement.  The full amount of the Loan Fee is and shall
be deemed fully earned as of the date hereof. Provided funds are available under
the Loan within the maximum  amount which may be  outstanding  thereunder at any
one time as set forth in Section 1.01, Lender is hereby  irrevocably  authorized
and directed to disburse  such second  installment  of the Loan Fee to itself on
the  anniversary  date of the  closing of the Loan.  In the event  there are not
funds  available  under  the  Loan  within  the  maximum  amount  which  may  be
outstanding  thereunder at any one time  sufficient to satisfy the obligation of
Borrower  relative to the payment of the second  installment  of the Loan Fee as
aforesaid,  Borrower shall pay such second  installment of the Loan Fee from its
funds other than the Loan. Borrower shall pay to the Lender on demand all costs,
expenses and charges of the Lender in  connection  with the approval of the Loan
by  the  Lender  and  the   negotiation,   preparation,   execution,   delivery,
administration,  supplement, modification, amendment, waiver and enforcement of,
and any other  action  taken by the Lender  under or  otherwise  to protect  its
rights and  interests  in respect  of, any Loan  Document,  and any  litigation,
dispute,  action or other proceeding (including bankruptcy proceedings) relating
thereto,  including recording fees, filing fees, search fees, reconveyance fees,
title  insurance  premiums,  appraisal,  engineering,  inspection and consulting
fees, the reasonable  fees and  disbursements  of the Lender's legal counsel and
other  out-of-pocket  expenses,  and any fees or other charges of the Lender for
appraisals  or  inspections  or for  review of  appraisals,  budgets,  plans and
specifications or other matters relating to the Project or the Collateral.

     Any amount payable to the Lender under any of the Loan Documents (including
any amount  payable  under this Section 4.12) which is not paid on the date when
due shall,  from and after such date,  bear interest at the Alternate Rate until
paid.  Such interest shall be payable by the Borrower to the Lender  immediately
and without demand.

     4.13 Indemnification by the Borrower. The Borrower shall indemnify,  defend
and save and hold harmless the Lender and its subsidiaries  and affiliates,  and
the  respective  directors,  officers,  agents,  attorneys and employees of each
(collectively the "Indemnitees") from and against,  and shall pay on demand, any
and all losses, liabilities, damages, costs, expenses and charges (including the
reasonable fees,  charges and  disbursements of external legal counsel) suffered
or incurred by any  Indemnitee as a result of (a) any failure of the Borrower to
perform any of its Obligations  under any Loan Document,  (b) any failure of any
Representation  by the  Borrower to be correct in all  respects  when made,  (c)
injury or death to persons or

                                      E-9
<PAGE>

damage  to  property  or  other  loss  occurring  on or in  connection  with the
Collateral or the Project,  whether caused by the negligence or any other act or
omission  of the  Borrower  or any  Lien  Claimant  or any  other  Person  or by
negligent,  faulty,  inadequate or defective design,  building,  construction or
maintenance or any other condition or otherwise,  (d) any claim of any surety in
connection with any bond relating to construction of any Improvements or offsite
improvements,  and (e) any claim,  demand or cause of  action,  or any action or
other  proceeding,  whether  meritorious or not, brought or asserted against any
Indemnitee  which relates to or arises out of the Loan Documents,  the Loan, the
Collateral,  the Project or any transaction contemplated by, or the relationship
between  the  Borrower  and the Lender or any action or  inaction  by the Lender
under,  the Loan  Documents,  provided that no  Indemnitee  shall be entitled to
indemnification  under  this  Section  4.13 for  matters  caused  solely by such
Indemnitee's  gross  negligence  or willful  misconduct.  Any  obligation of the
Borrower  under this Section 4.13 shall  survive the making and repayment of the
Loan and the expiration or termination of this Agreement and shall be secured by
the Deed of Trust.

     4.14  Actions and Further  Assurances.  The  Borrower  shall  appear in and
defend  all  actions  and other  proceedings  purporting  to  affect  any of the
Collateral  or the Project or the rights or  interests  of the Lender  under the
Loan  Documents (and the Lender may, at the  Borrower's  expense,  appear in and
defend any such action or other proceeding as the Lender may determine), and the
Borrower  shall take or cause to be taken such  further  action and  execute and
deliver or cause to be executed  and  delivered  such  further  Documents as the
Lender from time to time may reasonably require to maintain,  perfect,  protect,
assure and confirm  the  Lender's  rights and  interests  (including  rights and
interests in the  Collateral),  the Borrower's  Obligations and the intention of
the parties under the Loan Documents.

     4.15 Performance by the Lender. If the Borrower fails to perform any of its
Obligations  under any Loan Document and the Lender  reasonably  determines that
remedial  action is  necessary to protect the rights or interests of the Lender,
the Lender may,  without  notice to or demand on the Borrower,  perform any such
Obligations  in such manner and to such extent and take such other action as the
Lender may deem appropriate,  and all costs,  expenses and charges of the Lender
relating  to any such action  shall be payable by the  Borrower to the Lender in
accordance with Section 4.12.

     5.00 Representations of the Borrower.  The Borrower represents and warrants
to the Lender that:

     5.01 Formation and Qualification. Each Loan Party which is a corporation is
duly  incorporated,  validly existing and in good standing under the Laws of the
jurisdiction of its incorporation and is duly qualified in North Carolina;  each
Loan Party  which is a  partnership,  trust or other  entity is duly  formed and
validly existing under the Laws of the jurisdiction of its formation and, in the
case of a limited partnership formed under the Laws of a jurisdiction other than
California,  is duly  registered in North  Carolina;  each Loan Party which is a
corporation or limited  partnership is in good standing in North Carolina;  each
Loan Party  which is a limited

                                      E-10
<PAGE>

liability company is in good standing in North Carolina; and each Loan Party has
all  requisite  power and authority to conduct its business and to own, sell and
lease its properties.

     5.02 Loan  Documents.  The execution,  delivery and performance of the Loan
Documents by each Loan Party are within such Loan Party's  power and  authority,
have been duly  authorized by all  necessary  action and do not and will not (a)
require  any  Authorization  which has not been  obtained  (except to the extent
indicated  in  Section  5.05(b)  with  respect  to  Authorizations  required  in
connection  with the  Collateral or the  Project),  (b)  contravene  the Charter
Documents of any Loan Party,  any applicable  Laws or Other  Requirements or any
agreement or restriction binding on or affecting any Loan Party or its property,
or (c) result in or require the creation or  imposition  of any Lien or Right of
Others upon or with  respect to any  property  now or in the future owned by any
Loan Party (other than Liens in favor of the Lender). No Authorization which has
not been  obtained is required for the creation of the Liens or the  enforcement
by the Lender of its Remedies under the Loan Documents. Each Loan Document, when
executed and delivered,  will constitute the legal, valid and binding obligation
of each  Loan  Party  which  is a party  to or  bound  by  such  Loan  Document,
enforceable  against  such Loan Party in  accordance  with its terms,  except as
enforcement  may be limited by  bankruptcy,  insolvency  or other  similar  Laws
affecting the rights of creditors generally.

     5.03 Finder's or Broker's Fees. Except as otherwise  disclosed in Part B of
Exhibit  "C":  (a) no  finder's  or  broker's  fee is  payable  to any Person in
connection  with the Loan, and (b) the payment of any such fee disclosed in Part
B of Exhibit "C" is the sole  responsibility  of the  Borrower  and such fee has
been (or  upon  recordation  of the  Deed of Trust  will be) paid in full by the
Borrower. The Borrower hereby indemnifies and holds harmless the Lender from any
claims, liability,  damages, costs or expenses (including without limitation the
fees and expenses of legal counsel)  resulting from or arising out of any claims
or assertions by any Person  (including  without  limitation any broker,  agent,
financial advisor or other  intermediary) for any finder's broker's or other fee
or compensation  of any kind in connection  with the Loan. Such  indemnification
obligation  of the part of the Borrower  shall survive  termination  of the Loan
Documents.

     5.04  Collateral.  The  Borrower  has and  will  continue  to have (or upon
recordation  of the Deed of Trust will have and from and after such  recordation
will continue to have) good and  marketable  title to the  Collateral,  free and
clear of all Liens and Rights of Others,  subject only to  Permitted  Exceptions
and Permitted  Transfers of Personal  Property.  Upon recordation of the Deed of
Trust and filing of the financing  statement executed by the Borrower,  the Deed
of Trust will create a valid and indefeasible  first priority  perfected Lien in
the Collateral securing the payment and performance of all Obligations,  subject
only to Permitted Prior Exceptions and Permitted Transfers of Personal Property.
No financing statements covering any of the Collateral are on file in any public
office,  except  financing  statements  in favor  of the  Lender  and any  other
financing statements approved by the Lender in writing.

                                      E-11
<PAGE>

     5.05 Project  Information.  (a) The Borrower and, to the best  knowledge of
the Borrower,  any Governmental  Agency having  jurisdiction  over the Land have
complied  in  all  material   respects  with  all  applicable   Laws  and  Other
Requirements relating to the division and development of the Real Property,  and
the Borrower is, and the construction of the Improvements in accordance with the
terms of this Agreement will be, in compliance in all material respects with all
applicable  Laws  and  Other  Requirements  relating  to the  Collateral  or the
Project.  (b) Except as  otherwise  disclosed  in Part B of Exhibit "C", (i) all
Authorizations  required in connection with the Collateral or the Project or the
ultimate  development and use of the Real Property for its intended  purpose (as
indicated in Section 1.00) have been regularly and finally  received (other than
routine permits for work which has not yet commenced and any required  approvals
of construction by any Governmental Agency which (in each case) are to be issued
on a  ministerial  basis as  required  from time to time  during  the  course of
construction and after completion), and (ii) the development and use of the Real
Property  for its intended  purpose do not require the payment of  extraordinary
fees  or  assessments  or the  construction  of  other  improvements,  will  not
contravene any applicable Laws or Other Requirements, and are not subject to any
other  legal,  contractual  or practicle  impediments  which are material in the
aggregate.  (c) The  Project  Budget and any Line Item Budget  delivered  to the
Lender are based on  information  deemed  reliable by the Borrower and represent
the  Borrower's  best  estimate  of all  Project  Costs that will be required in
connection  with the Project,  and all Project Costs shown in the Project Budget
or any such Line Item Budget as "Previously  Paid By Borrower" have been paid in
full. (d) All Utility Services,  streets and other offsite improvements relating
to or adjoining  the Land or necessary for the ultimate  development  and use of
the  Real  Property  for its  intended  purpose  have  been or will be  promptly
completed  and/or otherwise made available at no further expense to the Borrower
(except for costs  relating  to such work  reflected  in the Project  Budget for
"Site  Development")  and are not and will not be subject to any  conditions  or
restrictions  which may  adversely  affect the  Collateral or the Project in any
material respect. (e) The approximate acreage of the Land is correctly set forth
in Section 1.00 and, except as otherwise disclosed in Part B of Exhibit "C", (i)
the Land is not located in a Flood  Hazard  Area,  nor is the Land subject to or
affected by any existing or proposed  Special  Taxes  (other than Special  Taxes
approved in writing by the Lender  after the date of this  Agreement),  and (ii)
the  Land and  each  Lot or  parcel  described  in  Exhibit  "A" are  separately
transferable  in  compliance  with all  applicable  subdivision  Laws and  Other
Requirements.  (f) Except as otherwise  disclosed in writing to the Lender,  the
Engineer Agreement,  the Construction  Contract,  if any, and any other contract
entered into by Borrower  relative to the development of the Project are in full
force and effect and free from any material breach or default by any party.

     5.06 Financial Information. (a) The Financial Statements of each Loan Party
which  have been  furnished  to the  Lender  fairly  present  such Loan  Party's
financial condition as at the dates of such Financial Statements and the results
of operations for the periods covered by such Financial Statements in accordance
with generally  accepted  accounting  principles  consistently  applied (or such
other method of  preparation  approved by the Lender in writing),  and since the
respective  dates of such  Financial  Statements,  there  has  been no  material

                                      E-12
<PAGE>

adverse change in the financial condition,  operations,  properties or prospects
of such Loan Parties.  (b) Each Loan Party has filed all tax returns required to
be filed by it,  and has paid all  Taxes  due  pursuant  to such  returns  or in
respect of any of its  properties  (except  for any such  Taxes  which are being
actively  contested in good faith by appropriate  proceedings),  and to the best
knowledge of each Loan Party, no basis exists for additional  assessments  which
have not been adequately  reserved against in the Financial  Statements referred
to above or  otherwise  disclosed  in writing to the Lender.  For so long as the
Loan or any part thereof shall remain outstanding, Borrower and all Loan Parties
shall  submit  such  financial  information  to Lender as  Lender  may  request,
including,  but not limited to, the  financial  information  required by Section
4.11.

     5.07 Litigation and Other Matters. Except as otherwise disclosed in writing
to the Lender: (a) no actions or other proceedings  affecting or relating to the
Collateral  or the Project are  pending or, to the best  knowledge  of each Loan
Party,  threatened,  (b) no actions or other  proceedings are pending or, to the
best  knowledge of each Loan Party,  threatened  against or  affecting  any Loan
Party or any property of any Loan Party which,  if determined  adversely to such
Loan  Party,  could  materially  impair  the  financial  condition,  operations,
properties  or prospects of such Loan Party or the ability of such Loan Party to
perform its obligations under the Loan Documents, and (c) the Borrower has given
notice to the Lender of any other  matters  which the  Borrower  is  required to
disclose to the Lender under Section 4.11(a).

     5.08 Documents and Other  Information.  All Documents and other information
delivered to the Lender  pursuant to any of the Loan  Documents  are and will be
complete  and  correct in all  material  respects at the time of delivery to the
Lender.

     5.09 Competing  Projects.  The Borrower hereby represents and warrants that
neither the  Borrower  nor any of its  affiliates  has or intends to  construct,
create,  arrange,  develop,  purchase  or sell  any  single  family  residential
building lots which constitute a Competing Project.

     5.10  Compliance  with Laws.  Without in any way limiting any of Borrower's
other  representations,  warranties  or covenants  contained in this  Agreement,
Borrower hereby  represents,  warrants and covenants that the Improvement  Plans
are, and the  construction  of the  Improvements  according  thereto will be, in
compliance  with  all  applicable   federal,   state  and  local  laws,   rules,
regulations,  ordinances and codes,  including without  limitation the Americans
with  Disabilities Act of 1990, 42 U.S.C.  12101, et. seq., as amended,  and the
Fair Housing Act, 42 U.S.C. 3601, et. seq., as amended.

     6.00 Events of Default and Remedies of the Lender.

     6.01 Events of Default.  The occurrence of any one or more of the following
events shall constitute an Event of Default:

                                      E-13
<PAGE>

          (a) the Borrower shall fail to pay all or any portion of the principal
     of the Note when due; or

          (b) the Borrower shall fail to pay any  installment of interest on the
     Note or any other  amount  payable by the  Borrower to the Lender under the
     Loan Documents  (including any deposit of Borrower's  Funds required by the
     Disbursement  Schedule)  within 10 days  after  the date  when due,  or the
     Borrower shall fail to pay all accrued  interest and all other amounts then
     payable by the  Borrower  to the  Lender  under the Loan  Documents  on the
     Maturity  Date or the date of final payment of the principal of the Note in
     full; or

          (c) any Loan Party  shall fail to perform or observe  any other  term,
     covenant  or  agreement  contained  in any Loan  Document on its part to be
     performed or observed and either (i) such failure  shall  continue for more
     than 30 days  after  notice of such  failure is given by the Lender to such
     Loan Party,  unless such failure is not  reasonably  capable of being cured
     within such 30-day period (but is reasonably  capable of being cured within
     60 days after such  notice)  and such Loan Party  commences  action to cure
     such failure  within such 30-day  period and  diligently  and  continuously
     prosecutes  such action to  completion  and causes such failure to be cured
     within 60 days after such notice;  or (ii) such  failure is not  reasonably
     capable of being cured within 60 days after notice of such failure is given
     by the Lender to such Loan Party; or

          (d) any  Representation  proves to have been incorrect in any material
     respect when made; or

          (e) work relating to  construction of the  Improvements  ceases for 15
     consecutive  days for any  reason  other  than acts of God or other  causes
     beyond the reasonable  control of the Borrower,  or such work ceases for 45
     consecutive days for any reason; or

          (f) the Borrower is enjoined by any court or other Governmental Agency
     from  constructing  the Improvements or performing any Obligations and such
     injunction continues unreleased and unstayed for 45 days; or

          (g) all or a  substantial  or material  portion of the  Collateral  is
     damaged or  destroyed  and the Lender has  reasonably  determined  that the
     security  of the  Deed of  Trust  has been  impaired  or that  the  repair,
     restoration  or  replacement  of the  Collateral  in  accordance  with  the
     requirements of the Deed of Trust is not economically practicable or is not
     likely to be completed  prior to the Maturity Date; or all or a substantial
     or material portion of the Collateral is condemned,  seized or appropriated
     by any  Governmental  Agency or subject  to any action or other  proceeding
     instituted by any Governmental Agency for any such purpose; or

                                      E-14
<PAGE>

          (h) any Loan Party is dissolved or  liquidated  or merged with or into
     any other  Person;  or for any  period of more than 10 days any Loan  Party
     which is a limited liability company,  corporation,  partnership,  trust or
     other entity ceases to exist in its present form and (where  applicable) in
     good standing and duly qualified under the Laws of the  jurisdiction of its
     incorporation  or  formation  and  California;  or any Loan Party who is an
     individual dies or becomes  incapacitated;  or all or substantially  all of
     the assets of any Loan Party are sold or otherwise transferred; or

          (i) any Loan Party ceases to be managed and  controlled  by the Person
     or Persons  who manage and  control  such Loan Party as of the date of this
     Agreement; or the Land is sold in violation of the terms of this Agreement;
     or any Loan Party  assigns or  attempts  to assign any rights or  interests
     under any Loan Document without the prior written consent of the Lender; or
     any  Loan  Document  becomes  or  is  claimed  by  any  Loan  Party  to  be
     unenforceable  against any Loan Party;  or the Deed of Trust shall cease to
     constitute a valid and  indefeasible  first priority  perfected Lien in the
     Collateral,  subject  only to  Permitted  Prior  Exceptions  and  Permitted
     Transfers of Personal Property; or

          (j) any Loan Party is subject to an order for relief by the bankruptcy
     court,  or is unable or admits in writing its inability to pay its debts as
     they mature or makes an  assignment  for the benefit of  creditors;  or any
     Loan Party  applies  for or consents to the  appointment  of any  receiver,
     trustee or similar  official  for it or for all or any part of its property
     (or any such  appointment  is made without its consent and the  appointment
     continues  undischarged  and  unstayed  for 60  days);  or any  Loan  Party
     institutes  or  consents  to any  bankruptcy,  insolvency,  reorganization,
     arrangement,    readjustment   of   debt,    dissolution,    custodianship,
     conservatorship, liquidation, rehabilitation or similar proceeding relating
     to it or to  all  or any  part  of  its  property  under  the  Laws  of any
     jurisdiction (or any such proceeding is instituted  without its consent and
     continues  undismissed  and unstayed for 60 days);  or any judgment,  writ,
     warrant of attachment  or execution or similar  process is issued or levied
     against any of the  Collateral or any other  property of any Loan Party and
     is not released,  vacated or fully bonded within 60 days after its issue or
     levy; or

          (k) the  Borrower  shall  fail to close the sale of an average of five
     (5) Lots per calendar  month to bona fide third party  purchasers  at sales
     prices  not less than the  "Minimum  Sales  Price"  set forth in  Exhibit E
     computed on a trailing rolling four (4) month basis; or

          (l) the  occurrence  of a default under any  indebtedness  of Borrower
     with any lender other than Lender or a default under any other indebtedness
     of Borrower with Lender; or

          (m)  any  material   adverse  change  shall  occur  in  the  financial
     condition,  operations,  properties or

                                      E-15
<PAGE>

     prospects of any Loan Party,  or any event shall occur which has a material
     adverse impact on the Collateral or the Project.

     6.02 Remedies of the Lender.  Upon the  occurrence of any Event of Default,
the  Lender  may,  without  notice to or  demand  upon the  Borrower,  which are
expressly  waived by the  Borrower  (except  for  notices or  demands  otherwise
required by applicable Laws to the extent not effectively waived by the Borrower
and any notices or demands specified in the Loan Documents), exercise any one or
more of the following Remedies as the Lender may determine:

          (a) the Lender may, at its option,  terminate all  commitments to make
     Disbursements,  or the Lender may waive the Event of  Default  or,  without
     waiving,  determine,  upon terms and conditions satisfactory to the Lender,
     to make further Disbursements;

          (b) the Lender may  declare the unpaid  principal  of the Note and all
     accrued  interest and other amounts  payable under the Loan Documents to be
     immediately  due and  payable,  in  which  event  all  such  amounts  shall
     immediately  be due and payable  without  protest,  presentment,  notice of
     dishonor,  demand or further notice of any kind, all of which are expressly
     waived by the Borrower;

          (c) the Lender may perform any of the  Borrower's  Obligations in such
     manner as the Lender may determine;

          (d)  the  Lender  may,   either   directly  or  through  an  agent  or
     court-appointed  receiver, take possession of the Collateral and enter into
     such  contracts and take such other action as the Lender deems  appropriate
     to complete or  partially  construct  all or any part of the  Improvements,
     subject to such  modifications  and  changes in the  Project or the plan of
     development as the Lender may deem appropriate; and

          (e) the Lender may  proceed to protect,  exercise  and enforce any and
     all other Remedies provided under the Loan Documents or by applicable Laws.

     All costs,  expenses,  charges and advances of the Lender in exercising any
such Remedies  (including  any such amounts which cause the  obligations  of the
Borrower to exceed the face amount of the Note) shall be payable by the Borrower
to the Lender in accordance with Section 4.12.

     Each of the  Remedies  of the  Lender  provided  in the Loan  Documents  is
cumulative  and not  exclusive  of, and shall not  prejudice,  any other  Remedy
provided  in the Loan  Documents  or by  applicable  Laws.  Each

                                      E-16
<PAGE>

Remedy may be  exercised  from time to time as often as deemed  necessary by the
Lender, and in such order and manner as the Lender may determine.  No failure or
delay on the part of the  Lender in  exercising  any Remedy  shall  operate as a
waiver of such  Remedy;  nor shall any single or partial  exercise of any Remedy
preclude any other or further exercise of such Remedy or of any other Remedy. No
application  of payments,  or any  advances or other action by the Lender,  will
cure or waive  any  Event of  Default  or  prevent  acceleration,  or  continued
acceleration,  of  amounts  payable  under the Loan  Documents  or  prevent  the
exercise, or continued exercise, of any Remedies of the Lender.

     7.00 Miscellaneous.

     7.01 Waivers and  Amendments.  No supplement to,  modification or amendment
of, or waiver,  consent or approval  under,  any of the Loan Documents  shall be
effective unless in writing and signed by the Lender, and any waiver, consent or
approval shall be effective  only in the specific  instance and for the specific
purpose for which given.

     7.02 Survival of  Representations.  All  Representations  shall survive the
making and  repayment  of the Loan and the  expiration  or  termination  of this
Agreement  and have been or will be relied upon by the  Lender,  notwithstanding
any investigation made by the Lender or on its behalf.

     7.03 Notices. All notices and other communications  provided under any Loan
Document  shall  be in  writing  and  mailed  or  personally  delivered  to  the
appropriate  party  at the  address  set  forth  on the  signature  page of this
Agreement or any other Loan  Document or, as to any party,  at any other address
in the State of California as shall be designated by it in a written notice sent
to the other party. All notices and other  communications  by the Borrower which
are  expressly  subject to  receipt  by the  Lender  under the terms of the Loan
Documents will be effective when received by an officer or other  representative
of the Lender having direct  responsibility  for  administration of the Loan. In
all other cases,  any notice or other  communication  will be  effective  (a) if
given by mail,  on the earlier of receipt or the third day after  deposit in the
United  States  mails  with  first-class  postage  prepaid,  or (b) if  given by
personal  delivery,  when  delivered,  provided  that the  requirements  of this
sentence  shall not  impair or delay the  effectiveness  of any  notice or other
communication  given by the  Lender  under  the Deed of Trust or any  Additional
Collateral  Agreements  when  such  notice  or other  communication  is given in
compliance with and would otherwise be effective under applicable Laws.

     7.04 Relationship of Parties. The relationship between the Borrower and the
Lender is, and at all times shall  remain,  solely that of debtor and  creditor,
and  shall not be,  or be  construed  to be, a joint  venture,  equity  venture,
partnership or other relationship of any nature.

     7.05 Nonliability of the Lender. The Borrower acknowledges and agrees that:

                                      E-17
<PAGE>

          (a) The Borrower shall be solely responsible for and shall rely solely
     on its own judgment with respect to all matters  relating to the Collateral
     or the  Project,  including  the conduct of the Borrower and its agents and
     employees,  the quality,  adequacy and suitability of the Improvement Plans
     and  any  Change  Orders  and  any  work or  materials  furnished  or to be
     furnished in connection  with the Project,  the skill,  qualifications  and
     performance of architects,  contractors,  subcontractors and suppliers, the
     feasibility of the Project and the sufficiency of budgets, cost projections
     and insurance,  the  supervision,  status and progress of construction  and
     compliance by the Borrower with the  requirements  of this  Agreement  with
     respect to such  construction  and the  accuracy  and  completeness  of all
     Disbursement Requests, and the Lender does not assume any responsibility to
     the Borrower or any other Person to review, inspect,  supervise or approve,
     or to provide any advice or information with respect to, any such matters;

          (b)  inspections of  construction  made by or on behalf of the Lender,
     and  acceptance,  approval  or  review  by the  Lender  of  any  Documents,
     information,  conditions or  performance  or any other action by the Lender
     under any of the Loan Documents,  are for purposes of administration of the
     Loan  only  and for the  sole  protection  of the  Lender,  and  shall  not
     constitute  a  representation  or warranty by the Lender to the Borrower or
     any other  Person or be relied upon by the Borrower or any other Person for
     any other purpose;

          (c) subject to Lender acting in a commercially reasonable manner , the
     Lender shall have no  responsibility or liability for any delays in funding
     or  construction  caused by any  inspection  of  construction  or review of
     Documents,  information,  conditions or  performance or any other action by
     the  Lender in  connection  with any  Disbursement  or Change  Order or the
     administration of the Loan; and

          (d) the Lender does not owe any duty of care to protect  the  Borrower
     or any other  Person  against or to inform the Borrower or any other Person
     of, and the Lender  shall not be  responsible  or liable to the Borrower or
     any other  Person  for any  loss,  damage,  liability  or claim of any kind
     relating  to injury or death to persons or damage to property or other loss
     resulting from, the negligence or any other act or omission of the Borrower
     or any  Lien  Claimant  or any  other  Person  or  any  negligent,  faulty,
     inadequate or defective  design,  building,  construction or maintenance or
     any other condition or the improper application of any Disbursements.

     7.06 Benefits and  Assignment.  The Loan Documents are made for the purpose
of defining  the rights and  obligations  of the Loan  Parties and the Lender in
connection  with the Loan and are intended for the sole  protection  of the Loan
Parties and the Lender and the Lender's  successors  and  assigns,  and no other
Person  shall  have any  rights  of any  nature  under or by  reason of the Loan
Documents.  The Loan  Documents  shall be binding on and inure to the benefit of
each of the Loan  Parties  and the Lender and their  respective  successors

                                      E-18
<PAGE>

and assigns, except that no Loan Party shall have the right to assign any rights
or interests  under any Loan Document  without the prior written  consent of the
Lender. The Lender may from time to time sell  participations in the Loan to any
Person (including  affiliates of the Lender) without notice to or the consent of
any Loan  Party;  provided,  however,  in the  event of the  sale by  Lender  of
participations in the Loan,  Borrower shall only be required to deal with Lender
relative to the Loan.

     7.07  Payments and  Computations.  All payments by any Loan Party under the
Loan Documents shall be made in lawful money of the United States free and clear
of, and without  reduction by reason of, any Taxes.  Any payment which is stated
to be due on a day  which  is not a  Banking  Day  shall  be  made  on the  next
succeeding  Banking  Day,  and any  such  extension  shall  be  included  in the
computation  of the payment of  interest.  Whenever any interest or other amount
payable  under the Loan  Documents is to be computed on the basis of a year of a
specified  number of days, the amount shall be calculated on the basis of a year
of such  specified  number of days for the actual number of days  (including the
first,  but  excluding  the  last)  occurring  in  the  period  for  which  such
calculation is made.  For purposes of calculating  amounts paid or payable under
the Loan Documents,  credit for payments shall be given upon receipt of same day
funds by the Lender at its office located at 155 North Lake Avenue,  11th Floor,
Pasadena,  California 91101,  Attention:  Construction Lending Division (or such
other  location  specified  by the Lender  from time to time in  writing)  at or
before the close of business,  Los Angeles time,  on any Banking Day.  Except as
otherwise  expressly  provided  in  the  Loan  Documents,  all  payments  on the
Obligations  received by the Lender shall be applied to the  Obligations in such
order and manner as the Lender may determine.

     7.08 Publicity.  During the course of construction of the  Improvements and
until the Loan is repaid in full, the Lender may, subject to Borrower's approval
which shall not be unreasonably withheld or delayed, place signs on the Land and
issue or publish releases or announcements  stating that construction  financing
is being provided by the Lender to the Borrower.

     7.09  Unsecured  Environmental  Obligations.  Anything  contained  in  this
Agreement or the Deed of Trust to the contrary notwithstanding, (a) the Borrower
shall have no obligation or liability  under this Agreement or the Deed of Trust
for  any  obligation  or  liability  of the  Borrower  under  any  Environmental
Indemnity  executed  by the  Borrower  which does not state it is secured by the
Deed of Trust (any such  obligation or liability being deemed to arise and exist
solely under such Environmental Indemnity),  and (b) any obligation or liability
of the Borrower under such  Environmental  Indemnity shall not be secured by the
Deed of Trust.

     7.10 Rules of  Construction.  (a) For  purposes of this  Agreement  and the
other  Loan  Documents:  (i) any  reference  to "days" or  "months"  shall  mean
calendar days or months, (ii) the word "including" shall mean "including without
limitation",  (iii)  any  reference  in any of the  Loan  Documents  to any Loan
Document  or other  Document or exhibit  shall mean such Loan  Document or other
Document  or  exhibit  as it may

                                      E-19
<PAGE>

from time to time be supplemented,  modified, amended and extended in accordance
with the terms of this Agreement, (iv) defined terms shall be equally applicable
to the singular and plural  forms,  and (v) all existing and future  exhibits to
this Agreement are incorporated in this Agreement by this reference. (b) Time is
of the essence of the Loan  Documents,  and the provisions of the Loan Documents
are declared to be severable.  (c) All  accounting  terms used and not otherwise
defined in any Loan  Document  shall be construed in  conformity  with,  and all
financial information  maintained or submitted by any Loan Party or other Person
under any Loan Document shall be prepared in accordance with, generally accepted
accounting principles consistently applied (or such other principles approved by
the Lender in  writing).  (d) If more than one Loan Party signs or is  otherwise
bound by any Loan  Document,  the  liability of each shall be joint and several.
(e) The Loan  Documents  shall be governed  by, and  construed  and  enforced in
accordance with, the Laws of North Carolina.

     7.11 Waiver of Jury Trial.  Each of the Lender and the Borrower waive trial
by jury in any action or other proceeding (including counterclaims),  whether at
law or  equity,  brought  by the  Lender or the  Borrower  against  the other on
matters  arising  out  of or in  any  way  related  to or  connected  with  this
Agreement,  the other Loan Documents,  the Loan or any transaction  contemplated
by, or the  relationship  between  the Lender and the  Borrower or any action or
inaction by either party under, any of the Loan Documents.

                                      E-20
<PAGE>

     IN WITNESS WHEREOF, the Borrower,  the Guarantor and the Lender have caused
this  Agreement  to be duly  executed  under seal as of the date  first  written
above.

      "LENDER":                                      "BORROWER":

INDYMAC BANK, F.S.B.                           JORDAN LAKE PRESERVE CORPORATION,
d/b/a CONSTRUCTION                             a North Carolina corporation
LENDING CORPORATION OF AMERICA

By:   /S/ ROBERT CASTILLO (SEAL)            By:/S/ PATRICK E. RONDEAU (SEAL)
      -------------------------               ------------------------------
Name: Robert Castillo                       Name: Patrick E. Rondeau
Title: Vice President                       Title:President

                                                                (Corporate Seal)

Lender's Address:                                  Borrower's Address:

Construction Lending Corporation            Jordan Lake Preserve Corporation
of America                                  c/o David Edwards
155 North Lake Avenue                       128 The Preserve Trail
11th Floor                                  Chapel  Hill, North Carolina 27517
Pasadena, California  91101
Attention:  Construction Lending Division With a copy to:

With copies to:                             Bluegreen Corporation
                                            Attention:  Legal Department
1560 North Orange Avenue, Ste 150           4960 Conference Way North
Winter Park, Florida 32789                  Boca Raton, Florida 33431

                                      E-21
<PAGE>

                                               "GUARANTOR":

                                               BLUEGREEN CORPORATION,
                                               a  Massachusetts corporation

                                               By:/S/ PATRICK E. RONDEAU (SEAL)
                                                   ----------------------------
                                               Name: Patrick E. Rondeau
                                               Title: Senior VP and Clerk

                                      E-22
<PAGE>

Loan No. 52-1170000
                                   EXHIBIT "F"
                                   DEFINITIONS
                               (Land Development)

          As used  in  this  Agreement,  the  following  terms  shall  have  the
     following meanings:

          "Additional  Collateral  Agreements" means the "Additional  Collateral
     Agreements"  (if any)  specified  in Exhibit  "C" and any other  mortgages,
     assignments  or other  agreements  (other than the Deed of Trust) now or in
     the future securing the Loan or any Guaranty.

          "Agreement"   means  this  Building  Loan  Agreement,   including  all
     exhibits.

          "Alternate Rate" means the "Alternate Rate" set forth in the Note.

          "Authorization"  means any authorization,  consent,  approval,  order,
     license,  permit,  exemption  or other  action by or from,  or any  filing,
     registration  or  qualification  with,  any  Governmental  Agency  or other
     Person.

          "Authorizing  Resolutions"  means (a) in the case of a corporation,  a
     certified copy of resolutions adopted by its board of directors, (b) in the
     case of a partnership (whether general or limited), a certificate signed by
     all of its  general  partners,  and (c) in the case of a trust or any other
     entity,  evidence of such other action as the Lender may  require,  in each
     case  authorizing  the  execution,  delivery  and  performance  of all Loan
     Documents to which it is a party or by which it is bound.

          "Banking Day" means any day (excluding Saturdays and Sundays) on which
     banks  located in North  Carolina are not  authorized or required by law to
     close.

          "Borrower's  Funds"  means  funds of the  Borrower  invested  or to be
     invested in the Project or deposited with the Lender  pursuant to Paragraph
     (e) of Exhibit B.

          "Cash  Collateral  Account" means an interest  earning cash collateral
     account  maintained  by the Lender  for the  account  of the  Borrower  for
     purposes of this Agreement or any of the other Loan  Documents  which shall
     be subject to a security interest in favor of the Lender for the purpose of
     securing the  Borrower's  Obligations  and over which the Lender shall have
     sole and exclusive control and right of withdrawal.

                                      E-1
<PAGE>

          "Change  Order" means a change in, or supplement  to, the  Improvement
     Plans.

          "Charter  Documents"  means  (a) in the  case  of a  corporation,  its
     articles of incorporation and bylaws, (b) in the case of a partnership, its
     partnership agreement and any certificate or statement of partnership,  and
     (c) in the case of a trust or any other entity, its formation documents, in
     each case as amended from time to time.

          "Collateral"  means all  property  in which the  Lender is  granted or
     purportedly granted a Lien pursuant to the Deed of Trust.

          "Competing  Project"  means,  unless  otherwise  approved by Lender in
     writing  to the  contrary,  any single  family  residential  lots  actively
     offered for sale which are located within a radius of five (5) miles of the
     Project and the minimum sales price for which lots on an  individual  basis
     are within $10,000.00 of any Lot in the Project.

          "Construction  Contract"  means, as to any  Contractor,  the agreement
     between the Borrower and the Contractor relating to services to be provided
     by the Contractor in connection with the Project.

          "Contractor"  means any Person  engaged by the  Borrower  from time to
     time as a general contractor in connection with the Project.

          "Cost  Savings"  means the  excess,  if any, of any Line Item over the
     actual Project Costs incurred in connection  with the work  associated with
     such Line  Item,  as  determined  by the  Lender  after  such work has been
     completed  and all such  Project  Costs have been paid in full and all Lien
     Claims and potential  Lien Claims  relating to such work have been released
     or otherwise discharged to the satisfaction of the Lender.

          "Deed of Trust" means the  Construction  Deed of Trust with Assignment
     of Rents, Security Agreement and Fixture Filing executed by the Borrower to
     secure the Loan.

          "Disbursement" means each disbursement of the proceeds of the Loan and
     each   disbursement  of  any  Borrower's   Funds  in  accordance  with  the
     Disbursement Schedule.

          "Disbursement  Account" has the meaning set forth in paragraph  (a) of
     the Disbursement Schedule.

          "Disbursement Request" means a written request for a Disbursement in a
     form approved by the Lender.

                                      E-2
<PAGE>

          "Disbursement  Schedule" means the "Disbursement Schedule" attached as
     Exhibit "B".

          "Documents"   means  written   documents  and   materials,   including
     agreements,  approvals,  certificates,   consents,  instruments,  financing
     statements, reports, budgets, forecasts and opinions.

          "Engineer"  means any Person  engaged by Borrower from time to time as
     an engineer or to perform similar functions in connection with the Project.

          "Engineer  Agreement" means as to any Engineer,  the agreement between
     the Borrower  and the  Engineer  relating to services to be provided by the
     Engineer in connection with the Project.

          "Environmental  Indemnity" means the Environmental  Indemnity executed
     by the Borrower in favor of the Lender and described in Exhibit "C".

          "Events of Default" means the events set forth in Section 6.01.

          "Excusable  Delay" means a delay, not to exceed a total of ninety (90)
     days,  caused by unusually  adverse weather  conditions which have not been
     taken into account in the construction schedule,  fire, earthquake or other
     acts  of  God,  strikes,   lock  outs,  acts  of  public  enemy,  riots  or
     insurrections  or any other  unforeseen  circumstances or events beyond the
     control of Borrower  (except  financial  circumstances or events or matters
     which may be resolved by the  payment of money),  and as to which  Borrower
     notifies Lender in writing within five (5) days after each such occurrence.

          "Financial Statements" means balance sheets and income statements.

          "Flood  Hazard  Area"  means an area  which has been  designated  as a
     special  flood  hazard area or subject to  comparable  risks by the Federal
     Emergency Management Agency or any successor to such Agency.

          "Governmental  Agency"  means (a) any  government or  municipality  or
     political   subdivision  of  any  government  or   municipality,   (b)  any
     assessment,  improvement,  community  facilities  or other  special  taxing
     district,  (c) any governmental or  quasi-governmental  agency,  authority,
     board,  bureau,  commission,  corporation,  department,  instrumentality or
     public body, (d) any court,  administrative  tribunal,  arbitrator,  public
     utility  or  regulatory  body,  or  (e)  any  central  bank  or  comparable
     authority.

                                      E-3

<PAGE>

          "Guarantor" means Bluegreen Corporation,  a Massachusetts corporation.

          "Guaranty"  means any  Guaranty  executed  in favor of the  Lender and
     described in Exhibit "C".

          "Improvement  Plans" means the  improvement  plans and  specifications
     described in Exhibit "C", as modified by any Change Orders  approved by the
     Lender.

          "Improvements"  means the  improvements,  including  site  development
     work, constructed or to be constructed pursuant to the Improvement Plans.

          "Land" means the land described in Exhibit "A".

          "Laws" means all federal,  state and local laws,  rules,  regulations,
     ordinances and codes.

          "Lien"  means any lien,  mortgage,  deed of  trust,  pledge,  security
     interest or other charge or encumbrance.

          "Lien  Claim"  means  (a)  any  mechanics  lien  affecting  any of the
     Collateral,  (b) any right of any  Person to  assert or  maintain  any such
     mechanics lien, and (c) any other claim to payment by any Lien Claimant.

          "Lien Claimant" means the Contractor, if any, and any other Person who
     has furnished labor, service,  equipment or material in connection with the
     Project or who is otherwise entitled to payment for any Project Costs.

          "Line Item" means each of the separate  items set forth in the Project
     Budget and in any Line Item Budget.

          "Line  Item  Budget"  means a  budget  for  the  Project  in form  and
     substance  satisfactory  to the Lender and setting  forth in such detail as
     the  Lender  may  require  the  nature  and  amount  of all  Project  Costs
     anticipated  in connection  with the Project as such budget may be modified
     from time to time in accordance with the Disbursement Schedule.

          "Loan"  means  the  loan  to be  made by the  Lender  to the  Borrower
     pursuant to this Agreement in an amount not to exceed the Loan Amount.

                                      E-4
<PAGE>

          "Loan Amount" means the amount of the Loan set forth in Section 1.00.

          "Loan  Documents"  means this Agreement,  the Note, the Deed of Trust,
     the  Environmental  Indemnity,  the Guaranties,  if any, and any Additional
     Collateral Agreements.

          "Loan Fee" means a  nonrefundable  loan fee to be paid by the Borrower
     to the Lender in installments and in the amount set forth in Exhibit "C".

          "Loan Party" means (a) the Borrower,  (b) any  Guarantor  which at the
     time has or may have any obligation or liability (whether fixed, contingent
     or otherwise) under any Guaranty  executed or to be executed by it, (c) any
     Person executing any Additional Collateral Agreements,  and (d) in the case
     of any Loan Party which is a partnership,  any general partner of such Loan
     Party.

          "Lot" means any portion of the Land which has been  approved  pursuant
     to all  applicable  Laws and legally  subdivided and platted of record as a
     single family residential building lot.

          "Maturity  Date" means the maturity date of the Note, as such maturity
     date may be extended from time to time.

          "Note" means the Promissory  Note executed by the Borrower in favor of
     the Lender to evidence the Loan.

          "Obligations"  means all  obligations  of the Borrower of every nature
     under the Loan Documents.

          "Other Requirements" means (a) the terms,  conditions and requirements
     of all Project Agreements,  Authorizations and Rights of Others relating to
     the  Collateral  or the Project  and all other  Documents,  agreements  and
     restrictions  relating to,  binding on or affecting  the  Collateral or the
     Project,   including  covenants,   conditions  and  restrictions,   leases,
     easements,   reservations,   rights  and  rights-of-way,  (b)  requirements
     relating  to the  supply of  Utility  Services  to the Real  Property,  (c)
     requirements and  recommendations of the soils report and any environmental
     impact report or negative declaration,  (d) all building, zoning, land use,
     planning and subdivision  requirements,  and (e)  requirements  relating to
     construction of offsite improvements.

          "Permitted  Exceptions"  means (a) Liens in favor of the  Lender,  (b)
     Permitted Prior Exceptions, and (c) other matters expressly approved by the
     Lender in writing  which are  subject  and  subordinate  to the Lien of the
     Trust Deed.

                                      E-5
<PAGE>

          "Permitted  Prior  Exceptions"  means  (a)  general  ad  valorem  real
     property  taxes which are not  delinquent,  (b) Special Taxes  described in
     Part B of Exhibit "C" or otherwise  approved in writing by the Lender which
     in each case are not  delinquent,  (c) mechanics  liens  affecting the Real
     Property and arising from the construction of the Improvements,  over which
     the Title Policy has insured the priority of the Lien of the Deed of Trust,
     and (d) such other matters as the Lender shall expressly approve in writing
     as "Permitted Prior Exceptions" for purposes of this Agreement.

          "Permitted  Transfer" means (a) any sale or other transfer of Lots and
     common areas (or undivided  interests in common areas) and the  disposition
     of any excess  proceeds of sale,  in each case to the extent  permitted  by
     Section 4.05, (b) subject to compliance  with paragraph (g) of Exhibit "B",
     the  release of the golf course and the related  amenities,  including  the
     club house, and (c) any transfer or other  disposition of Personal Property
     permitted by Section 4.06.

          "Person" means any person or entity,  whether an individual,  trustee,
     corporation,   partnership,  joint  stock  company,  trust,  unincorporated
     organization,   bank,   business   association  or  firm,   joint  venture,
     Governmental Agency or otherwise.

          "Personal  Property"  means tangible  personal  property and fixtures,
     including building materials and supplies,  equipment and other "Goods" (as
     defined in the Deed of Trust),  but excluding  construction  equipment of a
     type intended for use in connection with other projects, the leased modular
     sales office  utilized by Borrower,  leased golf carts used in  conjunction
     with the sale of Lots,  leased  golf  course  and golf  course  maintenance
     equipment and leased construction trailers.

          "Project" means the project for the acquisition  and/or refinancing of
     the Land, the  construction of the  Improvements and the development of the
     Land in accordance with the Improvement Plans.

          "Project   Agreements"   means  (a)  the   Engineer   Agreement,   the
     Construction  Contract,  if any, and any takeout,  refinancing or permanent
     loan commitment issued or assigned to the Borrower with respect to the Real
     Property,  and (b) all leases,  rental agreements,  service and maintenance
     agreements,  purchase  and sale  agreements,  purchase  options  and  other
     agreements  of any  nature  relating  to  the  Collateral  or the  Project,
     including agreements with contractors,  subcontractors,  suppliers, project
     managers and supervisors,  designers,  architects,  engineers, sales agents
     and consultants.

          "Project  Budget" means the budget for the Project attached as Exhibit
     "D", as  supplemented  by each Line Item Budget approved by the Lender from
     time to time, in each case as modified from time to time in accordance with
     the Disbursement Schedule.

                                      E-6
<PAGE>

          "Project Costs" means all costs and expenses of any nature relating to
     the Project or the financing of the Project.

          "Real  Property"  means  the Land and the  Improvements  and all other
     buildings,  structures and improvements now or in the future located on the
     Land.

          "Remedy" means any right, power or remedy.

          "Representations"  means the  representations  and  warranties  of the
     Borrower  set  forth  in  Section  5.00  and  all  other   representations,
     warranties and certifications to the Lender in the Loan Documents or in any
     other Document delivered under or in connection with the Loan Documents.

          "Right of Others"  means,  as to any property in which a Person has an
     interest, any legal or equitable claim or other interest (other than a Lien
     but including a leasehold interest,  a right of first refusal or a right of
     repossession  or removal) in or with respect to such  property  held by any
     other  Person,  and any option or right held by any other Person to acquire
     any such  claim or other  interest  or any Lien in or with  respect to such
     property.

          "Special Tax" means, as to any property, (a) any special assessment or
     other Tax which is or may become a Lien affecting such property, other than
     general  ad  valorem  real  property   taxes,   and  (b)  any   assessment,
     improvement,  community  facilities or other special taxing  district in or
     into which such  property  is or may be  located or  incorporated  or under
     which any  special  assessment  or other Tax which is or may  become a Lien
     affecting such property is or may be imposed.

          "Taxes"  means  all  taxes,  assessments,  charges,  fees  and  levies
     (including  interest and penalties)  imposed,  assessed or collected by any
     Governmental Agency.

          "Title  Policy" means an ALTA  extended  coverage  lender's  policy of
     title insurance in form and substance satisfactory to the Lender, issued by
     an  insurer  selected  by the  Borrower  and  satisfactory  to the  Lender,
     together  with  such  endorsements  and  policies  of  coinsurance   and/or
     reinsurance  as may be required by the Lender,  in a policy amount equal to
     the Loan Amount,  insuring  the Deed of Trust to be a valid first  priority
     Lien on the Land and showing the Land to be subject only to Permitted Prior
     Exceptions.

          "Utility  Services" means all utility services,  including water, gas,
     electricity, telephone, garbage removal and sewer services.

                                      E-7

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