Document:

Loan Agreement

This loan agreement (the "Agreement" or the "Loan Agreement") is entered into by
and between The Yankee Companies,  Inc., a Florida corporation ("Yankees"),  and
Colmena Corp., a Delaware  corporation  ("Colmena"),  (Yankees and Colmena being
sometimes  hereinafter  collectively referred to as the "Parties" and each being
sometimes hereinafter generically referred to as a "Party").

                                    Preamble:

     WHEREAS,  Colmena requires significant capital for miscellaneous  corporate
purposes; and

     WHEREAS,  Colmena is willing to pledge all of its assets,  wherever located
or whenever acquired, as security for such financing (the "Collateral"); and

     WHEREAS, subject to the following terms and conditions,  Yankees is willing
to  loan  Colmena  a sum of up to  $150,000,  on a  revolving  basis,  upon  the
collateral  security of the Collateral,  subject to the terms and conditions set
forth below:

     NOW, THEREFORE, in consideration of the sum of $10, other good and valuable
consideration, the receipt of which is hereby acknowledged, and, upon the mutual
covenants and conditions contained herein, the Parties hereby agree as follows:

                                   Witnesseth:

1.  DEFINITIONS & INTERPRETATION

    (a)   Definitions:

          The following terms, whether or not initially  capitalized,  will have
          the meanings set forth below:

          (1)  Accredited  Investor:

               A  person  or  entity  that  meets  the  asset,  income  or other
               requirements for treatment as an accredited investor specified in
               Rule  501  of  Commission  Regulation  D  promulgated  under  the
               Securities Act

          (2)  Affiliate:

               An entity or person that  controls,  is controlled by or is under
               common control with another person.

          (3)  Colmena:

               The term for Colmena Corp., a publicly held Delaware  corporation
               with a class of securities  registered under Section 12(g) of the
               Exchange Act, and a Party to this Agreement, together with all of
               its subsidiaries.

          (4)  Colmena Financial Statements:

               Financial  statements,  including  all related  schedules and the
               Notes thereto, of Colmena included in Colmena's last report filed
               on Commission Form 10-KSB;  the reports on Commission Form 10-QSB
               filed  subsequent  thereto  and  the  financial   statements  for
               subsidiaries subsequently acquired by Colmena included in current
               reports  on  Commission  Form 8-K  filed  since  the dates of the
               Subsequent  Quarterly Reports (the "Subsequent Current Reports");
               all such financial statements being hereinafter collectively  and

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               generically referred to as the "Colmena Financial Statements,"

          (5)  Capital Stock:

               The  generic  term used for equity  securities,  whether  common,
               preferred or otherwise.

          (6)  Collateral:

               All of Colmena's  assets,  whenever acquired or wherever located,
               whether  real or  personal,  tangible or  intangible,  current or
               inchoate, including, without limitation, all of the Capital Stock
               of its subsidiaries,  rights under agreements,  notes,  financial
               accounts,  intellectual  property  rights and all other things of
               whatever  nature  which the  Parties  may  define  as  Collateral
               subject to this Agreement in any future agreements.

          (7)  Commission:

               The United States Securities and Exchange Commission.

          (8)  Code:

               The Internal Revenue Code of 1986, as amended.

          (9)  Default:

               The occurrence of any of the following  events during the term of
               this Agreement or any extensions or renewals thereof:

               (A)  The failure of Colmena to pay any amount when due  hereunder
                    for a period of 20  business  days after  written  notice by
                    Yankees to Colmena;

               (B)  The failure by Colmena to perform any material  agreement or
                    material  undertaking  under  this  Agreement  or any  other
                    material agreement or material document given to evidence or
                    secure any of the Secured Obligations;

               (C)  The material  inaccuracy  of any  warranty,  representation,
                    covenant or agreement  made by Colmena to Yankees under this
                    Agreement   relating  to  any   related   document  or  this
                    Agreement, at the time when made;

               (D)  Colmena's  insolvency,  termination  of  business as a going
                    concern or inability  to pay debts  generally as they become
                    due;

               (E)  The  filing  of a  petition  or order for  relief  under the
                    bankruptcy  laws or insolvency  laws or for  reorganization,
                    composition,  adjustment,  or other relief of debtors  under
                    any  law by or  against  Colmena  if  such  petition  is not
                    dismissed within 30 days;

               (F)  The making of an assignment  for the benefit of creditors by
                    Colmena,  or the appointment of a receiver or liquidator for
                    Colmena;

               (G)  The order by a court of competent  jurisdiction  winding up,
                    or liquidation of, the affairs of Colmena;

               (H)  The dissolution of Colmena; or

               (I)  The   initiation   of  a  lawsuit   or   quasi-judicial   or
                    administrative   proceeding  by  any  person  or  entity  or
                    governmental  instrumentality against Colmena or any part of
                    the Collateral; or

               (J)  Any event defined as a default under any of the  agreements,
                    Notes or instruments ancillary to this Agreement.

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          (10) Exchange Act:

               The Securities Exchange Act of 1934, as amended.

          (11) Exchange Act Reports:

               All  reports  filed by Colmena  with the  Commission  pursuant to
               Sections 12(g), 13 and 15(d) of the Exchange Act.

          (12) GAAP:

               Generally accepted accounting principles, consistently applied.

          (13) Initial Funding Installment:

               The aggregate sum already  advanced to or on behalf of Colmena as
               of the date of this agreement.

          (14) IRS:

               The United States Internal Revenue Service.

          (15) Knowledge:

               When  used to  qualify a  representation  or  warranty,  the word
               "knowledge" or any derivations or variations thereof,  whether in
               the  form  of  a  word  or  phrase,  will  mean  knowledge  after
               reasonable inquiry by an executive officer of the legal entity on
               whose behalf the  assertion is made and will include  information
               that  such  legal  entity  should  have  had in the  exercise  of
               reasonable diligence.

          (16) Loans:

               The funds  advanced  by  Yankees  to  Colmena  from time to time,
               including  all funds  heretofore  advanced by Yankees to Colmena,
               which are the objects of this Agreement.

          (17) Material:

               When  used to  qualify a  representation  or  warranty,  the word
               "material" or any derivations or variations  thereof,  whether in
               the form of a word or  phrase,  will mean a  variance  that could
               have  negatively  affected a  decision  by a  reasonably  prudent
               person  to  engage  in  the  transactions  contemplated  by  this
               Agreement,  and will be  measured  both on the  occasion in which
               such term is  referenced  as well as on an  aggregate  basis with
               other similar matters.

          (18) NASD:

               The National Association of Securities Dealers,  Inc., a Delaware
               corporation and self regulatory  organization registered with the
               Commission.

          (19) Note(s):

               The negotiable instruments in the form of promissory notes issued
               to evince the Loans, substantially in the form annexed hereto and
               made a part hereof as exhibit 1(a)(19).

          (20) Obligations:

               Yankees rights and Colmena's  duties under this Agreement and the
               ancillary  instruments  referred  to herein,  including,  without
               limitation,  the  Note(s)  to be  executed  from  time to time by
               Colmena  in favor of  Yankees,  as  described  in this  Agreement
               executed  concurrently  herewith  and  incorporated  by reference
               herein,  together with all other  indebtedness  of Colmena or its
               affiliates to Yankees, direct or indirect,  primary or secondary,
               fixed  or  contingent,  or  otherwise  due or to  become  due now
               existing or hereafter acquired.

          (21) OTC Bulletin Board:

               The over the counter electronic securities market operated by the
               NASD.

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          (22) Secured Obligations:

               All  indebtedness  and other  obligations  of  Colmena to Yankees
               under or arising out of this  Agreement,  including any currently
               outstanding  or  future  loans,  or any  extensions  or  renewals
               thereof.

          (23) Securities Act:

               The Securities Act of 1933, as amended.

          (24) Subsequent Current Reports:

               Colmena's   reports  on  Commission  Form  8-K  filed  after  the
               Subsequent  Quarterly  Reports  but  prior  to the  date  of this
               Agreement.

          (25) Subsequent Quarterly Reports:

               Colmena's  reports on  Commission  Form 10-QSB for the  quarterly
               periods   following   Colmena's   last  10-KSB   filed  with  the
               Commission.

          (26) Substantial Compliance:

               Compliance  which the Party for whose benefit or at whose request
               an act is performed,  or for whose benefit or at whose request an
               act  is  refrained  from,   could  under  the   circumstances  be
               reasonably expected to accept as full compliance.

          (27) Tax:

               For the  purposes of this  Agreement,  a "Tax" or,  collectively,
               "Taxes,"  means any and all  federal,  state,  local and  foreign
               taxes,   assessments  and  other  governmental  charges,  duties,
               impositions  and  liabilities,  including  taxes  based  upon  or
               measured  by gross  receipts,  income,  profits,  sales,  use and
               occupation,  and value added,  ad valorem,  transfer,  franchise,
               withholding,  payroll, recapture, employment, excise and property
               taxes,  together  with  all  interest,  penalties  and  additions
               imposed with respect to such  amounts and any  obligations  under
               any agreements or arrangements with any other person with respect
               to such amounts.

    (b)  Interpretation

          (1)  When a  reference  is made  in this  Agreement  to  schedules  or
               exhibits, such reference will be to a schedule or exhibit to this
               Agreement unless otherwise indicated.

          (2)  The words "include,"  "includes" and "including" when used herein
               will be deemed in each case to be followed by the words  "without
               limitation."

          (3)  The captions in this Agreement are for  convenience and reference
               only and in no way define, describe, extend or limit the scope of
               this Agreement or the intent of any provisions hereof.

          (4)  All pronouns and any  variations  thereof will be deemed to refer
               to the masculine,  feminine,  neuter,  singular or plural, as the
               identity   of  the   Party  or   Parties,   or   their   personal
               representatives, successors and assigns may require.

          (5)  The  Parties  agree  that they have been  represented  by counsel
               during the  negotiation  and  execution  of this  Agreement  and,
               therefore, waive the application of any law, regulation,  holding
               or  rule  of  construction   providing  that  ambiguities  in  an
               agreement or other  document will be construed  against the party
               drafting such agreement or document.

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2.   LOANS.

     Subject to the terms of this Agreement,  Yankees agrees to lend Colmena, on
     the terms  hereof,  the sum of no more than  $150,000 on a revolving  basis
     (the "Loan(s)"), as follows:

     (a)  The  obligations of Yankees to loan funds to Colmena shall commence on
          the date hereof and shall terminate as provided in Section 3, at which
          time all  outstanding  loans  hereunder must be repaid,  together with
          accrued interest.

     (b)  Loans hereunder will be made in $10,000 increments, and each loan will
          be  represented  by its own  separate  negotiable  Note  and  security
          agreement.

     (c)  Each Note shall be:

          (1)  For a term of one year;  shall bear  interest  at the  annualized
               rate of 2% over the prime rate charged  during the subject period
               by Citibank,  N.A. (New York City) to its most favored  corporate
               borrowers for unsecured  obligations having a term of one year or
               less; and shall be payable upon demand after the one year term;

          (2)  Secured  by a  security  interest  in  all of  Colmena's  assets,
               including after acquired assets,  subject only to the prior liens
               reflected  in exhibit  2.1(c)(2)  annexed  hereto and made a part
               hereof  and to the  sale of  assets  in the  ordinary  course  of
               business,   provided   that  the   proceeds  of  such  sales  are
               re-invested  in  inventory or used to pay  operating  expenses of
               Colmena,  it being the intent of the Parties  that no proceeds be
               used for  payment of  dividends  or unusual  compensation  to the
               principals of Colmena.

     (d)  Colmena shall be directly  responsible for payment of all taxes,  fees
          and  recording  costs  associated  with  the  Loans,  the  hereinafter
          described Notes, required stock transfers,  UCC-1 financing statement,
          security agreements and collateral assignments.

     (e)  This  Agreement  is  being  executed  simultaneously  with a  Security
          Agreement,  a UCC-1  financing  statement  , and a Note the  terms and
          conditions of which are all incorporated by reference herein.

3.   TERM.

     (a)  This Agreement  shall commence on the date hereof and shall  terminate
          on the  730th  day  after  its  execution,  provided  that it shall be
          automatically renewed thereafter on a continuing one year basis unless
          the Party desiring not to renew provides the other with written notice
          of  intent  not to  renew  at  least  60 days  prior to the end of the
          then-current term or renewal term.

     (b)  Notwithstanding  the  foregoing,  this agreement will terminate on the
          occurrence of the following events:

          (1)  The date of the full and  complete  discharge  by  Colmena of all
               obligations to Yankees under this agreement;

          (2)  The  completion of a public  offering of  securities  yielding at
               least  $2,000,000  in net  proceeds  by Colmena or any  corporate
               entity with which  Colmena  becomes  subject to a  reorganization
               under Section 168 of the Code;

          (3)  Upon the occurrence of a Default by Colmena provided that Yankees
               elects to terminate this agreement by reason of such default.

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4.  RIGHT OF FIRST REFUSAL

     (a)  Throughout  the  term of this  Agreement  and  any  renewals  thereof,
          Yankees  shall have a right of first  refusal  to provide  any debt or
          debt-equity  hybrid financing required by Colmena and its subsidiaries
          (the "Right of First Refusal").

     (b)  In the  event  that  Colmena  has a  definite  opportunity  to  obtain
          financing  from some  person or entity  other that  Yankees,  it shall
          reduce such offer to written form specifying each and every applicable
          term and  identifying  the person or entity  involved  (the "Notice of
          Offer") and shall provide the Notice of Offer to Yankees in the manner
          generally hereinafter provided for submission of notices.

     (c)  Within  ten  business  days  following  receipt  of a Notice of Offer,
          Yankees shall, by written  response to Colmena in the manner generally
          hereinafter provided for submission of notices either:

          (1)  Consent to the proposed funding;

          (2)  Request additional data, which Colmena shall immediately provide;
               or

          (3)  Agree to provide the funding on the terms contained in the Notice
               of Offer.

     (d)  In the event that Yankees  demands  additional  data, the ten business
          days response period shall not commence until Yankees is provided with
          the required data.

     (e)  If  Yankees  has  been  provided  with all  required  data but has not
          responded to the Notice of Offer within the ten business days response
          period,  it  shall be  presumed  that  Yankees  has  consented  to the
          funding; however, no consent to funding or presumed consent to funding
          shall  result in the  waiver of  Yankees'  Right of First  Refusal  to
          provide any future funding.

     (f)  In the  event  that the  terms  of the  proposed  funding  vary in any
          material manner from the terms described in the Notice of Offer,  then
          any consent or presumed  consent shall be deemed void and Colmena will
          be required to notify  Yankees of such change and  resubmit  Notice of
          Offer to Yankees,  on the revised  basis,  and subject to the terms in
          this Section.

5.   CONDITIONS PRECEDENT.

     The  obligation  of  Yankees  to make the  Loan  shall  be  subject  to the
     following conditions:

     (a)  There shall have occurred no material  adverse  change in the business
          or the  financial  condition  of Colmena  since the date of the latest
          financial information filed by Colmena with the Commission,  copies of
          which shall be contemporaneously furnished by Colmena to Yankees;

     (b)  All acts,  conditions  and  things  (including  the  obtaining  of any
          necessary regulatory approvals and the making of any required filings,
          recordings or  registrations)  required to be done or performed and to
          have happened precedent to the execution,  delivery and performance of
          this  Agreement  and  the  related  security  agreements,   collateral
          assignments  and  Notes  shall  have been  done and  performed  to the
          satisfaction of Yankees and its legal counsel;

     (c)  All corporate and legal  proceedings and all documents and instruments
          in connection with the authorization of this Agreement and the related
          security agreements,  collateral assignments and Notes and all related
          instruments  and  ancillary  documentation  thereto  shall  have  been
          delivered  to Yankees and its legal  counsel,  and Yankees  shall have
          received all information and copies of all other related documents and
          instruments, including records of corporate proceedings, which Yankees
          and its legal counsel may reasonably have requested in connection

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          therewith,  such documents and instruments,  where appropriate,  to be
          certified by proper corporate or governmental authorities;

     (d)  Yankees  shall  have  received  the duly  executed  originals  of this
          Agreement and the related security agreements,  collateral assignments
          and Notes and all related ancillary  documentation  thereto and copies
          or  originals  of all  other  documents,  agreements  and  instruments
          relating  to any  aspect  of  the  transactions  contemplated  hereby,
          including evidence of insurance coverage required by Yankees; and

     (e)  Yankees shall have  received,  in form and substance  satisfactory  to
          Yankees and its legal counsel, such legal opinions,  consents,  and/or
          additional  documents  relating to any of the  foregoing  which it may
          reasonably require.

6.   MANDATORY PREPAYMENT IN THE EVENT OF LOSS;  LOAN REPAYMENT.

     (a)  Colmena  shall  keep all of the  Collateral  (as that term is  defined
          herein and from time to time in documents entered into by the Parties)
          fully insured under all risk insurance policies acceptable in form and
          substance to Yankees,  such  insurance to be in an amount  adequate to
          fully replace all the Collateral in the event of its damage or loss.

      (b) In the event that the  Collateral  shall be lost,  stolen,  destroyed,
          damaged beyond repair or rendered permanently unfit for normal use, or
          in  the  event  of  any  condemnation,   confiscation,   seizure,   or
          requisition  of title to or use of the  Collateral,  Colmena agrees to
          make  available  any insurance  proceeds for the exclusive  purpose of
          replacing the Collateral.

      (c) If,  however,  Colmena  elects not to repair or replace the Collateral
          within 30 days of Colmena's  receipt of the  insurance  proceeds,  all
          insurance proceeds shall be applied to a then-mandatory  prepayment of
          the Secured Obligations by paying in full an amount determined by:

          (1)  Obtaining a fraction,  the  numerator  of which will be the total
               number of payments  remaining  due on the Note unpaid  after such
               prepayment  is made  (including  the payment,  if any, due on the
               date on which prepayment is made) multiplied by the actual dollar
               amount of each payment due and the  denominator of which shall be
               the total number of payments  required to be paid under the Note,
               multiplied  by the actual dollar amount of each payment due under
               the Note;

          (2)  Multiplying the resultant fraction by 10%;

          (3)  Multiplying the resulting  percentage by the outstanding  balance
               due on the Note on the date of such prepayment;

          (4)  Adding the  resulting  dollar amount to the  outstanding  balance
               then due on the Note  (such  aggregate  sum being  the  mandatory
               prepayment required to be paid hereunder).

      (d) Notwithstanding  the foregoing,  Yankees shall be named as the primary
          beneficiary  on  all  insurance  policies  carried  by  Colmena  which
          directly, indirectly or incidentally cover the Collateral.

7.   PLACE OF PAYMENTS.

     Payment  of  principal,  interest  and other sums due or to become due with
     respect to the Loan and all the Secured  Obligations  are to be made at the
     principal  executive  offices of  Yankees,  or such other  place as Yankees
     shall designate to Colmena in writing, in lawful money of the United States
     of America in immediately available funds.

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8.    LATE PAYMENTS & OTHER CHARGES.

      (a) If any  installment  or other amount due with respect to the repayment
          of the Loan or any portion of the Secured Obligations is not paid when
          the same shall be due,  Colmena  will pay interest on any such overdue
          amount at the highest rate permitted by law until the date such amount
          is paid.

      (b) Colmena  shall  pay or cause  to be paid,  in  addition  to all  other
          amounts payable hereunder:

          (1)  Premiums for insurance required to be obtained in connection with
               the Loan and the Collateral;

          (2)  Fees paid for filing  documents in public  offices in  connection
               with the Loan and the transactions contemplated hereby; and

          (3)  Actual expenditures,  including  reasonable  attorney's fees, for
               proceedings  to collect  the Secured  Obligations  or to enforce,
               preserve  and  protect  the  Collateral  (as such term is defined
               herein) and the rights and interest of Yankees therein.

9.   ASSIGNMENT, GRANT OF SECURITY INTEREST & LIMITED SUBORDINATION.

     (a)  As  collateral  security  for the payment of the Secured  Obligations,
          Colmena, for the benefit and enforcement of its payment of the Secured
          Obligations,  hereby sells,  assigns,  and  transfers to Yankees,  its
          successors  and assigns,  and grants to Yankees,  a  continuing  first
          priority  security  interest  in and to all of its  present and future
          right,  title and  interest in and to all of its  securities  in other
          corporations (including subsidiaries),  assets,  receivables,  chattel
          paper  and all cash  and  non-cash  proceeds  (including  proceeds  of
          insurance),  subject  only to the prior  liens  reflected  in  exhibit
          2.1(c)(2).

     (b)  (1)  Subject to cancellation  for any future  financing upon provision
               of written  notice to such effect by Yankees,  Yankees hereby and
               herewith  subordinates  the obligation to receive  payments under
               the Notes to any  institutional  lender  where such  financing is
               required by Colmena for the  development  of corporate  property,
               provided  such  property is increased in value by an amount equal
               to or greater than the amount of the  subordinated  loan and that
               Yankees' legal counsel has ratified all documents and instruments
               pertaining to such  financing,  including  associated  mortgages,
               collateral assignments and security instruments.

          (2)  Notwithstanding  the security interests held by Yankees,  Colmena
               shall  be  permitted  to make  purchases  and  sales,  and to pay
               operating  expenses,  as  incurred  in  the  ordinary  course  of
               business,  provided,  however,  that  until  all  obligations  to
               Yankees have been completely discharged by full payment,  Colmena
               shall  make  no  distributions  to  stockholders,  or  repay  any
               obligations to stockholders except normal and reasonable salaries
               for  services in fact  rendered  to Colmena (it being  understood
               that the  term  "stockholders"  applies  to the  stockholders  of
               Colmena and to the  stockholders of any corporate entity that may
               subsequently acquire Colmena).

     (c)  Notwithstanding the foregoing:

          (1)  Yankees'  agreement to subordinate  its rights under its Loans to
               Colmena  shall not apply to the first lien on any property  other
               than that directly benefitted by such acquisition and development
               financing  and, in no event,  shall Yankees' first lien on all of
               the  authorized  capital  stock  of  Colmena's   subsidiaries  be
               subordinated  to any other  entity,  whether  private,  public or
               governmental.

          (2)  No  subordination  permitted  pursuant to this  Section  shall be
               effective  until  Yankees  has been  provided  with copies of all
               documentation   pertaining   to  the   subject   acquisition   or
               development financing and

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               Yankees'  legal  counsel  has  agreed  to the form and  substance
               thereof, which agreement may not be unreasonably withheld.

10.  RIGHTS AND POWERS WITH RESPECT TO THE COLLATERAL.

     Colmena hereby authorizes  Yankees to do every act and thing in the name of
     Colmena or Yankees or otherwise which Yankees may deem advisable to enforce
     effectively its rights and interest in and to the  Collateral,  and Colmena
     hereby  irrevocably  appoints Yankees,  with full power of substitution and
     delegation,  as its true and lawful  attorney-in-  fact, with full right to
     demand, enforce,  collect, receive, receipt and give releases for any funds
     due or to become due under or arising out of or with respect to, any of the
     Collateral  and to  endorse  all  deeds,  notes,  receipts,  checks,  stock
     certificates  and  other  instruments,  and to do and take  all such  other
     actions relating to any of the Collateral,  to file any claims or institute
     any  proceedings  with respect to any of the foregoing  which Yankees deems
     necessary or advisable and to compromise any such demand, claim or action.

11.  ASSIGNMENTS, ENCUMBRANCES, TRANSFERS.

     (a)  Colmena  will not,  without the prior  consent of  Yankees,  assign or
          transfer  any of its rights or delegate  any of its  obligations  with
          respect to this  Agreement  or sell,  dispose or  otherwise  grant any
          interest in or to any of the Collateral,  incur or suffer to exist any
          lien, charge, mortgage,  security interest or encumbrances upon any of
          the Collateral, except the lien of Yankees created by this Agreement.

     (b)  In the event of any  conveyance,  foreclosure or other  disposition of
          the Collateral  without Yankees's  consent,  then the entire principal
          balance,  together with all accrued  interest shall be immediately due
          and payable.

12.  ACKNOWLEDGMENTS, REPRESENTATIONS AND WARRANTIES.

     Colmena acknowledges, represents and warrants that:

     (a)  As of the date of this Agreement,  Colmena is not insolvent within the
          meaning of applicable  state and federal laws dealing with debtors and
          creditors, including the Federal Bankruptcy Code;

     (b)  Colmena is a Delaware  corporation duly organized and validly existing
          in good standing under the laws of the State of Delaware, is qualified
          to engage in business in all jurisdictions where such qualification is
          required,  and has  full  power  and  authority  to  enter  into  this
          Agreement and to consummate the transactions contemplated hereby ;

     (c)  This  Agreement  and  the  related  security  agreements,   collateral
          assignments and Notes provided for herein have been duly authorized by
          all necessary  corporate  action and constitute  the legal,  valid and
          binding  obligations of Colmena  enforceable in accordance  with their
          respective terms;

     (d)  The  making and  performance  by  Colmena  of this  Agreement  and the
          related security  agreements,  collateral  assignments,  Notes and any
          related documents and the transactions contemplated hereby and thereby
          do not  contravene  any provisions of law applicable to Colmena and do
          not conflict or are not  inconsistent  with, and will not result (with
          or without the giving of notice or both) in a breach of or  constitute
          a default or require any consent  under,  or result in the creation of
          any lien,  charge or encumbrance  upon the Collateral  pursuant to the
          terms  of  any  credit  agreement,   indenture,   mortgage,   purchase
          agreement, deed of trust, security agreement, lease guarantee or other
          instrument  to which  Colmena  is a party or by which  Colmena  or its
          assets may be bound or to which its properties may be subject;

     (e)  All sales, use, property or other taxes, licenses,  tolls,  inspection
          or other fees,  bonds,  permits or  certificates  which were or may be
          required to be paid or obtained in connection  with the acquisition or
          ownership  by Colmena of the  Collateral  will have been,  or when due
          will be, paid in full or obtained;

                                     Page 66
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     (f)  Colmena has good,  valid and marketable  title to the Collateral  free
          and  clear  of  all  liens,   claims  and   encumbrances,   except  as
          specifically disclosed in exhibit 2.1(c)(2), if any;

     (g)  Concurrently  with or  prior to the  time  the  initial  Loan is made,
          Yankees  will have a  perfected  continuing  first  priority  security
          interest  in  and  to  all  the  Collateral,  except  as  specifically
          disclosed in exhibit 2.1(c)(2), if any; and

     (h)  Colmena has not entered into any understanding or agreement,  (oral or
          in writing) relating to the transactions  contemplated  herein, or any
          other transactions  contemplated or permitted by this Agreement,  with
          any person or entity which  understanding,  agreement or other writing
          would,  in  the  reasonable   determination  of  Yankees,  affect  the
          Collateral in any manner  whatsoever or any of the rights or interests
          of Yankees with respect thereto.

13.  DEFAULT;  REMEDIES.

     (a)  If a Default occurs under this  Agreement,  Yankees may accelerate the
          full  amount of the  then-outstanding  Secured  Obligations  (in which
          event such amount will become  immediately due and payable by Colmena)
          without presentment,  demand, protest or other notice of any kind, all
          of which are hereby expressly waived,  and, if not paid in full within
          10 business days  thereafter,  Yankees shall, at its election,  become
          vested with the  Collateral in fee simple  absolute,  without  further
          action or legal  recourse,  this Section  being deemed a full warranty
          bill of sale absolute with reference to the Collateral.

     (b)  In the event  that for any  reason  Yankees  is not in  possession  or
          control of any of the  Collateral,  or  disclaims  its right to assume
          ownership  thereof  because  of public  policies  or  otherwise,  then
          Yankees may pursue all of the rights and remedies  with respect to the
          Collateral  accruing to Yankees  hereunder or by operation of law as a
          secured creditor under the Uniform Commercial Code or other applicable
          law and all such  available  rights and  remedies,  to the full extent
          permitted by the law, shall be cumulative and not exclusive.

14.  APPLICATION OF PROCEEDS.

     In the event that Yankees is unable or unwilling to take  possession of all
     the Collateral in the event of a Default,  then,  upon  enforcement of this
     Agreement,  all funds received upon the  foreclosure and liquidation of the
     Collateral shall be applied by Yankees in the following order:

     (a)  To the payment of all costs, expenses, liabilities and compensation of
          Yankees  (including fees and expenses of its agents and legal counsel)
          incurred  or  accrued  in  connection  with any  action or  proceeding
          brought by  Yankees or in  connection  with the  maintenance,  sale or
          other disposition of the Collateral or any portion thereof;

     (b)  To the payments of all interest then due and payable on the Loans;

     (c)  To the payments of all principal then due and payable on the Loans;

     (d)  To the payment of all other obligations to Yankees;

     (e)  To the payment of all other Secured Obligations;

     (f)  To the  payment  of any  surplus  then  remaining  to Colmena or other
          persons legally entitled thereto.

15.  RECEIPT OF FUNDS BY COLMENA.

     Notwithstanding  the  granting  to  Yankees  of a first  priority  security
     interest  in and to the  Collateral,  if,  at any time  while  the  Secured
     Obligations   remain   unsatisfied,   Colmena   shall  receive  any  amount
     representing funds due, or proceeds of, any of the Collateral, such

                                     Page 67
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     sums shall be held by Colmena in trust for Yankees and shall be immediately
     paid by  Colmena  to Yankees  in the form so  received,  together  with any
     necessary endorsement thereon.

16.  FURTHER ASSURANCES.

     Colmena  agrees to execute and deliver to Yankees,  or cause to be executed
     and delivered to Yankees,  such further instruments and documents as may be
     reasonably  requested  by  Yankees  to  carry  out  fully  the  intent  and
     accomplish the purposes of this Agreement, and the transactions referred to
     herein and therein, and to protect and maintain the first priority security
     interest of Yankees in and to the Collateral or the immediate conveyance of
     the Collateral to Yankees in the event of a default hereunder.

17.  FINANCIALS.

     Colmena hereby represents,  warrants, and covenants to Yankees that it will
     cause to be  delivered  to Yankees (a) as soon as  practicable,  but in any
     event  within 90 days  after the end of each  fiscal  year,  statements  of
     earnings and retained  earnings and changes in its  financial  position for
     such year,  and its balance  sheet at the end to such fiscal year,  setting
     forth in each case in  comparative  form the  corresponding  figures of the
     previous  annual  audit,  all in  reasonable  detail and  certified by, and
     accompanied  by a  report  or  opinion  of,  independent  certified  public
     accountants of recognized standing acceptable to Yankees, and (b) within 45
     days after the end of each fiscal  quarter,  its statements of earnings and
     retained  earnings  and  changes  in  financial  position  for such  fiscal
     quarter,  and its balance sheet at the end of such fiscal quarter,  setting
     forth in each case in  comparative  form the  corresponding  figures of the
     previous  quarterly  audit,  all  in  reasonable  detail  and  prepared  in
     accordance  with generally  accepted  accounting  principles,  consistently
     applied, and certified by Colmena's Chief Financial Officer.

18.  DISPUTE RESOLUTION.

     (a)  In any action  between the Parties to enforce any of the terms of this
          Agreement  or any  other  matter  arising  from  this  Agreement,  any
          proceedings  pertaining  directly  or  indirectly  to  the  rights  or
          obligations  of the  Parties  hereunder  will,  to the extent  legally
          permitted,  be held in Broward  County,  Florida,  and the  prevailing
          Party will be entitled to recover  its costs and  expenses,  including
          reasonable  attorneys'  fees  up to and  including  all  negotiations,
          trials  and  appeals,  whether  or  not  any  formal  proceedings  are
          initiated.

     (b)  In the event of any  dispute  arising  under  this  Agreement,  or the
          negotiation  thereof or inducements  to enter into the Agreement,  the
          dispute will,  at the request of any Party,  be  exclusively  resolved
          through the following procedures:

          (1) (A)   First,  the issue  will be  submitted  to  mediation  before
                    Mediation,  Inc.,  a  mediation  service in Broward  County,
                    Florida, or any other such service as designated by Yankees,
                    with  the   mediator   to  be  selected  by  lot  from  four
                    alternatives  to be  provided,  two by  Colmena  and  two by
                    Yankees.

              (B)   The mediation  efforts will be concluded within ten business
                    days after their initiation  unless the Parties  unanimously
                    agree to an extended mediation period;

          (2)  In the event that  mediation does not lead to a resolution of the
               dispute then at the request of any Party, the Parties will submit
               the dispute to binding  arbitration before an arbitration service
               located in Broward  County,  Florida,  with the  arbitrator to be
               selected by lot, from four  alternatives  to be provided,  two by
               Colmena and two by Yankees.

          (3)  (A)  Expenses of mediation  will be borne equally by the Parties,
                    if successful.

                                     Page 68
<PAGE>

               (B)  Expenses of mediation,  if  unsuccessful  and of arbitration
                    will be  borne  by the  Party or  Parties  against  whom the
                    arbitration decision is rendered.

               (C)  If the  terms  of the  arbitral  award  do not  establish  a
                    prevailing   Party,   then  the  expenses  of   unsuccessful
                    mediation  and  arbitration  will be  borne  equally  by the
                    Parties involved.

     (c)  Jurisdiction.

          (1)  Colmena  irrevocably  consents to service of any  summons  and/or
               legal process by registered or certified  United States air mail,
               postage  prepaid,  to Colmena at the  address  set forth below in
               Section  19(b),  such method of service to  constitute,  in every
               respect,  sufficient and effective service of process in any such
               legal action or proceeding.

          (2)  Nothing in this  Agreement  shall  affect the right to service of
               process in any other  manner  permitted by law or limit the right
               of Yankees to bring  actions,  suits or proceedings in the courts
               of any other jurisdiction.

          (3)  Colmena further agrees that final judgment against it in any such
               legal action,  suit or proceeding  shall be conclusive and may be
               enforced in any other jurisdiction,  within or outside the United
               States  of  America,  by suit on the  judgment,  a  certified  or
               exemplified  copy of which  shall be  conclusive  evidence of the
               fact and the amount of Colmena's liability.

19.  MISCELLANEOUS.

     (a)  No Waiver; Cumulative Remedies.

          (1)  No  failure or delay on the part of  Yankees  in  exercising  any
               right,  power or privilege  hereunder  shall  operate as a waiver
               thereof,  nor shall any single or partial  exercise of any right,
               power or privilege  hereunder or thereunder preclude any other or
               further  exercise  thereof or the  exercise  of any other  right,
               power or privilege.

          (2)  No right or remedy in this  Agreement is intended to be exclusive
               but each shall be cumulative and in addition to any given Yankees
               at law or in equity;  and the  exercise  by Yankees of any one or
               more of such  remedies  shall not  preclude the  simultaneous  or
               later exercise by Yankees of any or all such other remedies.

          (3)  No  express  or  implied  waiver  by  Yankees  of any  future  or
               subsequent  Default  shall  separate  as a  waiver  of any  other
               provision of this agreement.

          (4)  To the extent  permitted by law, Colmena waives any rights now or
               hereafter conferred by statute or otherwise which limit or modify
               any of Yankees's rights or remedies under this Agreement.

     (b)  Notices.

          (1)  All  notices,  requests and demands to or upon any Party shall be
               deemed  to have been duly  given or made  when  deposited  in the
               United  States mail,  first class postage  prepaid,  addressed to
               such Party at such  address  as may be  hereafter  designated  in
               writing by such Party to the other Party hereto.

          (2)  Notices will initially be addressed as follows:

                                    Page 69
<PAGE>

              (A)  To Colmena:

                                  Colmena Corp.
                            Crystal Corporate Center;
                     2500 North Military Trail, Suite 225-C;
                           Boca Raton, Florida 33431
                      Attention: Edward Dmytryk, President
            Telephone (561) 998-2031, Fax (561) 998-4635; and,
                         e-mail edmytryk@earthlink.net.

              (B)  To Yankees:

                           The Yankee Companies, Inc.
                            Crystal Corporate Center;
                     2500 North Military Trail, Suite 225;
                            Boca Raton, Florida 33431
                   Attention: Leonard Miles Tucker, President
               Telephone (561) 998-2025, Fax (561) 998-3425; and,
                        e-mail lenny@yankeecompanies.com;

          (3)  At the  request of any Party,  notice  will also be  provided  by
               overnight delivery,  facsimile  transmission or e-mail,  provided
               that a transmission receipt is retained.

          (4)  (A)  The Parties  acknowledge  that Yankees serves as a strategic
                    consultant  to Colmena  and has acted as  scrivener  for the
                    Parties in this  transaction  but that  Yankees is neither a
                    law  firm  nor  an  agency   subject  to  any   professional
                    regulation or oversight.

               (B)  Because of the  inherent  conflict  of  interests  involved,
                    Yankees  has  advised  Colmena to retain  independent  legal
                    counsel  to  review  this  Agreement  and its  exhibits  and
                    incorporated materials on its behalf.

               (C)  The  decision by any Party not to use the  services of legal
                    counsel in conjunction  with this transaction will be solely
                    at its own risk,  each Party  acknowledging  that applicable
                    rules of the Florida Bar prevent  Yankees'  general counsel,
                    who has  reviewed,  approved  and  caused  modifications  on
                    behalf of  Yankees,  from  representing  anyone  other  than
                    Yankees in this transaction.

               (D)  This Agreement shall not be construed more strictly  against
                    Yankees nor will it be  interpreted  in any manner  based on
                    the fact that it was authored by Yankees.

     (c)  Payment of Expenses  and Taxes;  Performance  by Yankees of  Colmena's
          Obligations.

          (1)  Colmena agrees,  whether or not the transactions  contemplated by
               this Agreement shall be consummated, to pay

               (A)  All costs and  expenses  of Yankees in  connection  with the
                    negotiation,  preparation,  execution  and  delivery of this
                    Agreement, and the other documents relating hereto;

               (B)  All fees and taxes in connection  with the recording of this
                    Agreement  or any  other  document  or  instrument  required
                    hereby; and

               (C)  All costs and  expenses  of Yankees in  connection  with the
                    enforcement of this  Agreement  including all legal fees and
                    disbursements arising in connection therewith.

          (2)  Colmena agrees to pay, and to indemnify and hold Yankees harmless
               from any delay in paying all taxes, including without limitation,
               sales,  use,  stamp and personal  property  taxes (other than any
               corporate income, capital,  franchise or similar taxes payable by
               Yankees with respect to the payments

                                    Page 70
<PAGE>

               made to Yankees hereunder or thereunder) and all license, filing,
               and registration fees and assessments and other charges,  if any,
               which may be payable in connection  with the execution,  delivery
               and performance of this Agreement, or any modification thereof.

          (3)  If Colmena fails to perform or comply with any of its  agreements
               contained  herein and Yankees shall itself perform or comply,  or
               otherwise cause  performance or compliance,  with such agreement,
               the  expenses  of  Yankees   incurred  in  connection  with  such
               performance or compliance,  together with interest thereon at the
               rate  provided  for in the Notes  shall be  payable by Colmena to
               Yankees on demand and until such payment shall constitute part of
               the Secured Obligations secured hereby.

     (d)  Survival of Representations and Warranties.

          All  representations  and  warranties  made in this  Agreement and any
          documents  delivered  pursuant  hereto shall survive the execution and
          delivery of this Agreement and the making of the Loans hereunder.

     (e)  Amendments.

          Neither this Agreement,  nor any instruments  related thereto,  may be
          changed,  waived,  discharged  or  terminated  orally,  but only by an
          instrument in writing signed by the Party against whom  enforcement of
          a change, waiver, discharge or termination is sought.

     (f)  Counterparts & Facsimile Execution.

          (1)  This  Agreement  may be  executed by the Parties on any number of
               separate  counterparts,  each  of  which  when  so  executed  and
               delivered shall be an original,  but all such counterparts  shall
               together constitute but one and the same instrument.

          (2)  Execution  by original  signature  on a document  delivered  to a
               Party  through  facsimile   transmission  shall  be  deemed  full
               execution   for  all   purposes  by  the  Party   executing   and
               transmitting such document.

     (g)  Headings.

          The headings of the Sections and Paragraphs are for convenience  only,
          are not part of this  Agreement  and shall not be deemed to affect the
          meaning or construction of any of the provisions hereof.

     (h)  Successors or Assigns.

          This  Agreement  shall be  binding  upon and inure to the  benefit  of
          Colmena and  Yankees  and their  respective  successors  and  assigns,
          except  that  Colmena  may  not  assign  or  transfer  its  rights  or
          obligations hereunder or any interest herein without the prior written
          consent of Yankees.

     (i)  Governing Law

          This Agreement  shall be governed by, and construed and interpreted in
          accordance  with the laws of State of  Delaware,  other than its rules
          pertaining to conflicts of laws.

     (j)  Severability & Reconstruction.

          (1)  If  any  provision  or  any  portion  of any  provision  of  this
               Agreement,  or the  application  of such provision or any portion
               thereof to any person or  circumstance  shall be held  invalid or
               unenforceable,  the remaining  portions of such provision and the
               remaining provisions of this Agreement or the application of such
               provision  or portion  of such  provision  as is held  invalid or
               unenforceable to

                                     Page 71
<PAGE>

               persons  or  circumstances  other  than those to which it is held
               invalid or unenforceable, shall not be affected thereby.

          (2)  In  the  event  any  provision  in  this   Agreement  or  related
               instruments  is found to be  unenforceable,  the  Parties  hereby
               request that the Court interpreting such provision restructure it
               in the manner consistent with applicable law most closely meeting
               the intent of the Parties, as reflected hereby.

     (k)  Number and Gender.

          All pronouns and any  variations  thereof  shall be deemed to refer to
          the masculine,  feminine,  neuter, singular or plural, as the identity
          of the Party or Parties, or their personal representatives, successors
          and assigns, or the context may require.

          (l)  License.

          (1)  This Agreement is the property of Yankees.

          (2)  The use hereof by the Parties is  authorized  solely for purposes
               of this transaction,  and the use of this form of agreement or of
               any derivation thereof without Yankees's prior written permission
               is prohibited.

     In Witness  Whereof,  the Parties have caused this Agreement to be executed
on their behalf by their duly authorized  representatives as of the day last set
forth below.

Signed, Sealed and Delivered
         In Our Presence

/s/Jennifer Mitchem/s/                           Colmena Corp.

/s/Sally Ann Stroberg/s/
                                        By:    /s/Edward C. Dmytryk/s/
                                                  Edward C. Dmytryk, President
Dated: September 24, 2001
                                                 [Corporate Seal]

                                      Attest:  s/Vanessa H. Lindsey/s/
                                                 Vanessa H. Lindsey, Secretary

STATE OF FLORIDA           }
COUNTY OF MARION           } SS.:

     BEFORE ME, an officer duly authorized to administer  oaths,  did personally
appear on this 24th day of  September,  2001,  Edward  C. Dmytryk and Vanessa H.
Lindsey,  known to me who,  being duly  sworn,  did state that they are the duly
elected  and  serving  president  and  secretary  of Colmena  Corp.,  a Delaware
corporation  ("Colmena"),  and that pursuant to authority  duly delegated by its
board of directors,  they executed the foregoing Agreement on behalf of Colmena,
effective as of the date set forth therein. My commission expires:

         [NOTARIAL SEAL]
                                                /s/Sally Ann Stroberg/s/

                                                 Notary Public

                                     Page 72
<PAGE>

                                                 The Yankee Companies, Inc.
/s/Nancy Molinari/s/

/s/Marc Frankel/s/                      By:  /s/Leonard Miles Tucker/s/
                                                Leonard Miles Tucker, President
Dated:   September 24, 2001
                                               [Corporate Seal]

                                      Attest: /s/Vanessa H. Lindsey/s/
                                                 Vanessa H. Lindsey, Secretary
STATE OF FLORIDA           }
COUNTY OF PALM BEACH       } SS.:

     BEFORE ME, an officer duly authorized to administer  oaths,  did personally
appear on this 24th day of September,  2001, Leonard Miles Tucker,  known  to me
who,  being  duly  sworn,  did state  that he is the duly  elected  and  serving
president of The Yankee Companies, Inc., a Florida corporation ("Yankees"),  and
that pursuant to authority duly delegated by its board of directors, he executed
the foregoing Agreement on behalf of Yankees, effective as of the date set forth
therein. My commission expires:

         [NOTARIAL SEAL]
                                               /s/Charles J. Scimeca/s/

                                                  Notary Public

STATE OF FLORIDA           }
COUNTY OF MARION                    } SS.:

     BEFORE ME, an officer duly authorized to administer  oaths,  did personally
appear on this 24th day of  September,  2001,  Vanessa H. Lindsey,  known  to me
who,  being duly  sworn,  did state  that she is the duly  elected  and  serving
secretary of The Yankee Companies, Inc., a Florida corporation ("Yankees"),  and
that  pursuant  to  authority  duly  delegated  by its board of  directors,  she
executed the foregoing Agreement on behalf of Yankees,  effective as of the date
set forth therein. My commission expires:

         [NOTARIAL SEAL]
                                              /s/Sally Ann Stroberg/s/

                                                 Notary Public

                                     Page 73
<PAGE>

                               Security Agreement

     THIS SECURITY  AGREEMENT (the  "Agreement")  is entered into by and between
The Yankee  Companies,  Inc.,  a Florida  corporation  ("Yankees"),  and Colmena
Corp., a Delaware  corporation  ("Colmena";  Yankees and Colmena being sometimes
hereinafter  collectively  referred to as the "Parties" and each being sometimes
hereinafter generically referred to as a "Party").

                                   Witnesseth

     In consideration of the sum of TEN DOLLARS  ($10.00),  the premises herein,
and other good and valuable  consideration given by Yankees to Colmena,  and for
other value  received by Colmena;  the Parties,  intending to be legally  bound,
hereby agree as follows:

1.   DEFINITIONS:

     The definitions and rules of  interpretation  contained in Section 1 of the
     loan  agreement  executed by the Parties  concurrently  herewith (the "Loan
     Agreement") are hereby incorporated by reference.

2.   ASSIGNMENT OF COLLATERAL:

     (a)  As  security  for the  payment  of the  Obligations  and all Loans and
          advances  heretofore made, made concurrently with the execution of the
          Loan Agreement or made in the future by Yankees to Colmena and for all
          Colmena's liabilities to Yankees,  including any extensions,  renewals
          or changes in form of any thereof,  Colmena  hereby assigns to Yankees
          and grants to Yankees a security interest under the Uniform Commercial
          Code in the Collateral.

     (b)  The Collateral shall be deemed to have been  constructively  delivered
          by  Colmena  to  Yankees  immediately   following  execution  of  this
          Agreement and shall be deemed to remain in the  possession of Colmena,
          as trustee for Yankees,  for so long as any  obligations of Colmena to
          Yankees  remain  unfulfilled;  provided,  however,  that,  if  Colmena
          defaults in its  obligations to Yankees,  then at Yankees' sole option
          and without any required  further  action or legal process by Yankees,
          all of the Collateral shall become the sole and exclusive  property of
          Yankees,  this Section being deemed a full warranty bill of sale, deed
          and securities power for all of the Collateral.

3.   RESTRAINT:

     So long as any  Liability  to  Yankees  is  outstanding,  Colmena  will not
     without prior written consent of Yankees borrow from anyone on the security
     of, or pledge, or grant any security interest in, any Collateral, or permit
     any lien or encumbrance  to attach to any of the foregoing,  or any levy to
     be made  thereon,  or any  financing  statement  to be on file with respect
     thereto.

4.   OFFICE:

     (a)  Colmena  represents that its principal place of business is at Crystal
          Corporate Center;  2500 North Military Trail, Suite 225-C; Boca Raton,
          Florida 33431.

     (b)  Colmena will  immediately  advise Yankees in writing of the opening of
          any new place of  business or the  closing of its  existing  places of
          business,  and of any  changes in the  location of the place where any
          new  Collateral  not in the  possession  of  Yankees  is kept or where
          Colmena's records concerning the Collateral are kept.

                                    Page 74
<PAGE>

5.   DOCUMENTS:

     Colmena will promptly:

     (a)  Join with Yankees in executing a financing  statement and pay the cost
          of filing the same in any public office deemed advisable by Yankees;

     (b)  Execute and deliver to Yankees upon demand such additional  assurances
          and instruments as may be required by Yankees to maintain the security
          of  Yankees  in  good  standing  and  effectuate  the  intent  of this
          Agreement,  including additional security agreements on a Loan by Loan
          basis; and

     (c)  In the event of Default  either of the terms hereof,  or as enumerated
          in the Loan Agreement or in the Notes,  execute all such documents and
          do all such acts necessary to have the Collateral transferred into the
          name of Yankees as Yankees shall request.

6.   INDEMNIFICATION:

     Colmena hereby  indemnifies and holds harmless  Yankees for all loss, cost,
     expense or damage resulting from Colmena's Default under this Agreement.

7.   INSURANCE:

     (a)  In accordance with Section 6 of the Loan Agreement, Colmena shall keep
          all  Collateral  insured under policies of all-risk  insurance  (which
          shall  include  fire,  extended  coverage and  vandalism)  placed with
          companies and agents  approved by Yankees and such insurance  shall be
          carried in amounts  which Yankees  deems  sufficient  for its complete
          protection, but in no event less than the greater of (i) the aggregate
          principal sum of the  Liabilities  or (ii) the  aggregate  replacement
          value of the Collateral.

     (b)  (1)  The premiums for all such insurance  shall be paid by Colmena not
               later than fifteen (15) days before the same are due.

          (2)  The  original  certificates  of such policy or policies  shall be
               delivered  to and held by  Yankees  and shall be made  payable to
               Yankees. In the event any sum of money becomes payable under such
               policy or policies,  Yankees shall have the option to receive and
               apply the same on  account  of the  indebtedness  hereby  secured
               against  payments  of  principal  in the  inverse  order of their
               maturity, or to permit Colmena to receive and use it, or any part
               thereof, for other purposes, without thereby waiving or impairing
               any equity, lien or right under and by virtue of this Agreement.

          (3)  The  placing of such  insurance  and the paying of the premium of
               such  insurance,  or any part  thereof,  by Yankees  shall not be
               deemed to waive or affect any right of Yankees hereunder.

     (c)  (1)  If  Yankees  acquires  title  to  the  Collateral,  any  unearned
               premiums on any hazard insurance covering the Collateral and held
               by Yankees are hereby assigned to and shall belong to Yankees.

          (2)  If at any time during the term of this  Agreement  any  insurance
               policies shall be canceled and returned premiums become available
               (excluding return of premium in whole on or before such time as a
               new fully paid insurance  policy is issued in accordance with the
               terms of this Agreement), these returned premiums shall belong to
               Yankees and, at the option of Yankees, may be credited by Yankees
               against the Liabilities secured hereunder.

     (d)  Any  rights of Yankees to any  insurance  proceeds  shall in no way be
          affected  or  impaired  by reason of the fact  that  Yankees  may have
          exercised  any remedy  available  to Yankees.  In the event any losses
          shall be payable on any  insurance  policies  covering the Collateral,

                                     Page 75
<PAGE>

          Colmena and all  successors  in title and all persons now or hereafter
          holding  inferior  liens on such  damaged  and/or  destroyed  property
          hereby  appoint  Yankees  agent and  attorney-in-fact  to endorse such
          proceeds,  checks(s)  or drafts(s)  for the purpose,  at the option of
          Yankees, of applying them against the Liabilities.

8.   COVENANTS:

     Colmena covenants and agrees that it shall:

     (a)  (1)  Receive as the sole  property  of Yankees and hold as trustee for
               Yankees all funds,  checks,  notes,  drafts,  and other  property
               ("Items of Payment")  representing the proceeds of any Collateral
               in which  Yankees  has a security  interest,  which come into the
               possession of Colmena;

          (2)  Deposit all such items of payment  immediately  in the exact form
               received in a special account of Colmena in a federally  insured,
               state or federal savings and loan  association or commercial bank
               ("Bank") entitled "Cash Collateral Account"; and

          (3)  Execute such documents and do such acts as Yankees may require to
               insure that Yankees shall have a perfected  security  interest in
               such Cash Collateral Account to additionally secure all Colmena's
               Liabilities; provided, however, that Colmena shall have the right
               to use  all  or a  portion  of the  Cash  Collateral  Account  to
               purchase new  Collateral  of like kind and quality free and clear
               of all liens;

     (b)  Furnish a  landlord's  waiver  of lien  where  Colmena  is a tenant in
          possession of leased  premises,  in form acceptable to Yankees wherein
          landlord  waives its lien for rent and all claims and demands of every
          kind against Colmena's Collateral and authorizes Yankees to enter upon
          the  leased  premises  for the  purpose  of  enabling  Yankees to take
          possession  of  Colmena's  Collateral,  pursuant  to the terms of this
          Agreement;

     (c)  (1)  Make  all  payments  of  taxes,  including  but  not  limited  to
               assessments, levies, liabilities, obligations and encumbrances of
               every nature upon the Collateral before same become delinquent;

          (2)  Colmena shall deliver to Yankees receipts  evidencing the payment
               of said taxes, assessments, levies, liabilities, obligations, and
               encumbrances  immediately  on the payment  thereof as required in
               this Section.

          (3)  In default thereof,  Yankees may at any time pay the same without
               waiving or affecting  any rights  hereunder  and every payment so
               made shall bear  interest  from the date  thereof at the  highest
               rate permitted by law;

     (d)  Pay on demand  any cost,  charge  and  expense,  including  reasonable
          attorneys'  fees through all trial and appellate  levels,  incurred or
          paid at any time by Yankees  arising  out of the failure of Colmena to
          perform  timely and comply with and abide by any of the  stipulations,
          agreements,  conditions  and covenants of the Agreement and every such
          payment  after the same becomes due shall bear  interest  from date at
          the highest rate permitted by law;

     (e)  Keep  adequate  records  and  books  of  account  in  accordance  with
          generally  accepted  accounting  principles  with respect to Colmena's
          business and permit Yankees, its agents,  accountants and attorneys to
          visit and inspect the  Collateral and examine its records and books of
          account  and to  discuss  its  affairs,  finances  and  accounts  with
          Yankees, at such reasonable times during normal business hours, as may
          be requested by Yankees upon twenty-four (24) hours notice;

     (f)  Keep the Collateral in good repair and operating order.

                                     Page 76
<PAGE>

9.   NO EXEMPTION:

     Colmena hereby  declares that the Collateral  forms no part of any property
     owned,  used or claimed by Colmena as  exempted  from forced sale under the
     laws of any state, and disclaims,  waives and renounces all and every claim
     to exemption under any homestead exemption.

10.  CONVEYANCE:

     (a)  The sale, lease, transfer or other conveyance of the Collateral or any
          part  thereof to another  party or parties  without the prior  written
          consent of Yankees shall,  at Yankees's  option,  constitute a Default
          under this Agreement.  No Collateral  shall be removed,  demolished or
          substantially altered, nor shall any Collateral be removed without the
          prior written consent of Yankees.

     (b)  In the event that Colmena is in possession  of any of the  Collateral,
          for  whatever  purpose or reason,  upon the failure of Colmena to keep
          such  Collateral  in good  condition  or  repair,  Yankees  may at its
          option, make such repairs, and any such sums expended by Yankees shall
          be  immediately  due and payable and shall bear interest from the date
          thereof at the highest rate permitted by law.

11.  ENCUMBRANCES:

     The  encumbrance  of the  Collateral  in  any  manner,  including,  without
     limitation,  the  obtaining by Colmena or its  successors or assigns of any
     additional  financing  secured by any part of the  Collateral,  without the
     prior written  consent of Yankees (which consent shall be either granted or
     withheld in Yankees's sole and unfettered  discretion)  shall  constitute a
     Default under this Agreement.

12.  LAWFUL PURPOSE:

     To the extent that it is in  possession of any of the  Collateral,  Colmena
     shall not use the  Collateral or allow the same to be used for any unlawful
     purpose  or in  violation  of  any  law,  ordinance  or  regulation  now or
     hereafter covering or affecting the use thereof.

13.  DEFAULT:

     The default  provisions of the Loan  Agreement,  the Notes and of the other
     agreements pertaining to this transaction executed concurrently herewith or
     hereafter  pursuant to the terms of the Loan  Agreement are hereby,  herein
     incorporated by reference.

14.  OTHER ACTIONS:

     (a)  In the event Colmena fails to pay any charges or obligations  required
          to be paid or perform  any acts  required to be  performed  by Colmena
          hereunder  within the time set forth for such payment or  performance,
          Yankees  shall  have the right to pay such  charge or  obligation  and
          perform such act without waiving or affecting the option of Yankees to
          consider this Agreement in Default.

     (b)  All funds advanced by Yankees pursuant to this Section shall be deemed
          additional  funds owed by Colmena to  Yankees,  shall be payable  with
          interest  from  the  date  of  advance  thereof  at the  highest  rate
          permitted by law, upon demand of Yankees  thereof and shall be secured
          by the lien of this Agreement.

     (c)  If any action or proceeding  shall be commenced by any person to which
          action or  proceeding  Yankees  is made a party,  or in which it shall
          become  necessary to defend or uphold the lien of this Agreement,  all
          sums  paid  by  Yankees  for  the  expenses  of  any  such  litigation
          (including reasonable attorney's fees through all trial and  appellate

                                     Page 77
<PAGE>

          levels)  shall be paid by Colmena to Yankees  together  with  interest
          thereon at the highest rate permitted by law.

15.  COSTS:

     Colmena  shall  pay  to  Yankees  all  lawful  charges  and  disbursements,
     including attorneys' fees through all negotiations,  administrative,  trial
     and appellate  levels incurred by Yankees in connection with the protecting
     or  enforcing  the rights of Yankees  hereunder  and all such sums shall be
     secured by the lien of this Agreement.

16.  WAIVER:

     (a)  Colmena  waives notice of  non-payment  and protest of all  commercial
          paper,  including the liabilities at any time held by Yankees on which
          Colmena is in any way liable.

     (b)  (1)  No waiver by Yankees of any Default  shall operate as a waiver of
               any other Default or of the same Default on a future occasion.

          (2)  No delay or  omission  on the part of Yankees in  exercising  any
               right or remedy shall operate as a waiver thereof,  and no single
               or  partial  exercise  by  Yankees  of any right or remedy  shall
               preclude any other or further exercise thereof or the exercise of
               any other right or remedy.

          (3)  Time is of the essence of this Agreement.

          (4)  The  provisions of this  Agreement are cumulative and in addition
               to the  provisions  of any remedy under any Note or other writing
               evidencing any liability secured hereby.

     (c)  Colmena  releases Yankees from all claims for loss or damage caused by
          any failure to protect the Collateral or by any act or omission on the
          part of Yankees,  its officers,  agents and employees,  except willful
          misconduct.

17.  MISCELLANEOUS:

     The    provisions    of   Sections   18    ('Dispute    Resolution")    and
     19("Miscellaneous")  of the  Loan  Agreement  are  hereby  incorporated  by
     reference.

                                     Page 78
<PAGE>

     In Witness  Whereof,  the Parties have caused this Agreement to be executed
on their behalf by their duly authorized  representatives as of the day last set
forth below.

Signed, Sealed and Delivered
         In Our Presence
                                                     Colmena Corp.
/s/Jennifer Mitchem/s/

/s/Sally Ann Stroberg/s/             By:      /s/Edward C. Dmytryk/s/
                                                 Edward C. Dmytryk, President
Dated:   September 24, 2001
                                                  [Corporate Seal]
                                      Attest: /s/Vanessa H. Lindsey/s/
                                                 Vanessa H. Lindsey, Secretary

STATE OF FLORIDA           }
COUNTY OF MARION                    } SS.:

     BEFORE ME, an officer duly authorized to administer  oaths,  did personally
appear on this 24th day of  September,  2001,  Edward C. Dmytryk  and Vanessa H.
Lindsey,  known to me who,  being duly  sworn,  did state that they are the duly
elected  and  serving  president  and  secretary  of Colmena  Corp.,  a Delaware
corporation  ("Colmena"),  and that pursuant to authority  duly delegated by its
board of directors,  they executed the foregoing Agreement on behalf of Yankees,
effective as of the date set forth therein. My commission expires:

         [NOTARIAL SEAL]
                                                 /s/Sally Ann Stroberg/s/

                                                 Notary Public

                                                 The Yankee Companies, Inc.
/s/Nancy Molinari/s/

/s/Marc Frankel/s/                     By:    /s/Leonard Miles Tucker/s/
                                                 Leonard Miles Tucker, President
Dated:   September 24, 2001
                                                [Corporate Seal]

                                      Attest: /s/Vanessa H. Lindsey/s/
                                                 Vanessa H. Lindsey, Secretary
STATE OF FLORIDA           }
COUNTY OF PALM BEACH       } SS.:

     BEFORE ME, an officer duly authorized to administer  oaths,  did personally
appear on this 24th day of September,  2001,  Leonard Miles Tucker,  known to me
who,  being  duly  sworn,  did state  that he is the duly  elected  and  serving
president of The Yankee Companies, Inc., a Florida corporation ("Yankees"),  and
that pursuant to authority duly delegated by its board of directors, he executed
the foregoing Agreement on behalf of Yankees, effective as of the date set forth
therein. My commission expires:

         [NOTARIAL SEAL]
                                                 /s/Charles J. Scimeca/s/

                                                 Notary Public

                                     Page 79
<PAGE>

STATE OF FLORIDA           }
COUNTY OF MARION                    } SS.:

     BEFORE ME, an officer duly authorized to administer  oaths,  did personally
appear on this 24th day of September, 2001, Vanessa H. Lindsey, known to me who,
being duly sworn,  did state that she is the duly elected and serving  secretary
of The Yankee  Companies,  Inc.,  a Florida  corporation  ("Yankees"),  and that
pursuant to authority duly delegated by its board of directors, she executed the
foregoing  Agreement  on behalf of Yankees,  effective  as of the date set forth
therein. My commission expires:

         [NOTARIAL SEAL]
                                                 /s/Sally Ann Stroberg/s/

                                                 Notary Public

                                     Page 80
<PAGE>

                     Full Recourse Secured Promissory Note

$ 96,190.64                                             September 30, 2001

     FOR VALUE  RECEIVED,  Colmena Corp.,  a publicly held Delaware  corporation
with a class of  securities  registered  under Section 12(g) of the Exchange Act
and with offices at Crystal Corporate Center;  2500 North Military Trail,  Suite
225-C; Boca Raton, Florida 33431 ("Colmena"),  hereby agrees to pay to the order
of The  Yankee  Companies,  Inc.,  a Florida  corporation,  with  offices at The
Crystal  Corporate  Center;  2500 North Military  Trail,  Suite 225; Boca Raton,
Florida 33431  ("Yankees"),  the principal sum of $96,190.64,  yielding interest
commencing to run from the date hereof at a compound  annual rate of 2% over the
prime rate charged during the subject  period by Citibank  Bank,  N.A. (New York
City) or its successor in interest to its most favored  corporate  borrowers for
unsecured obligations having a term of one year or less, on the following terms:

                                     Terms:

1.   INCORPORATED TERMS

     (a)  The terms and  provisions of the loan  agreement  entered into between
          Colmena and Yankees on September  24, 2001, a copy of which is annexed
          hereto and made a part hereof as exhibit 1 (the "Loan Agreement"), are
          hereby incorporated by reference as if here fully set forth.

     (b)  Any  provisions  in this Note  dealing  with a subject or object  also
          dealt  with  in  the  Loan  Agreement  shall,  to  the  extent  of any
          inconsistencies,  be deemed to provide Yankees with additional  rights
          and options which will be exercisable in Yankees' sole discretion.

2.   PAYMENTS & COLLATERAL

     (a)  This  Note  shall  be for a term of 1 year  and  shall  thereafter  be
          payable upon written demand by Yankees.

     (b)  Upon  demand,  payment  shall be made at the  offices of Yankees or at
          such other address as Yankees shall designate for such purpose.

     (c)  This Promissory Note is secured by all of the Assets of Colmena.

3.   ACCELERATION

     In the event that any payment due hereunder is not made when due, or on the
     occurrence  of any one or more of the  events of Default  specified  in the
     Loan Agreement,  the entire unpaid principal,  all accrued interest and any
     related  reimbursements for costs and expenses shall immediately become due
     and payable, without notice or demand, at the option of the holder hereof.

4.   PREPAYMENTS

     Colmena may prepay this Note, in whole or in part, without penalty,  at any
     time, provided however, that any partial payments shall first be applied to
     related  reimbursable  costs and  expenses,  then to interest,  and then to
     principal.

5.   ASSUMPTION

     (a)  This Note may be assigned  at will by Yankees  but shall be  assumable
          only with the express, prior written consent of Yankees.

                                    Page 81

<PAGE>

     (b)  In the event of any  permitted  assumption,  all prior  obligors  will
          remain liable to Yankees as  guarantors  of the  permitted  assignee's
          performance   but  Yankees  shall  have  the  right  to  enforce  such
          guarantees   directly  against  them  without  first  having  to  seek
          performance, payment or relief from the permitted assignee.

6.   DEMANDS & NOTICES

     (a)  Any demand or notice  made or given by Yankees  pursuant  hereto or in
          connection  herewith,  shall be made on or given  to  Colmena  and its
          successors in interest by registered mail,  return receipt  requested,
          postage prepaid,  directed to Colmena's address provided above or such
          updated  address as Yankees  shall have in its  records,  in each case
          with copies to Kevin W. Dornan,  Esquire;  General Counsel, The Yankee
          Companies,  Inc., 1941 Southeast 51st Terrace;  Ocala,  Florida 34471,
          attorney for Yankees,  and to any legal counsel designated by Colmena;
          but making or giving,  or  attempting  to make or give,  any demand or
          notice shall not waive any right granted hereunder or otherwise to act
          without demand or notice.

     (b)  Notice shall be effective  when  delivered by Yankees to United States
          Postal  Service  personnel,  whether  or not such  personnel  actually
          succeed  in  effecting  delivery  to  Colmena  or  its  successors  in
          interest.

7.   EXPENSES

     Colmena hereby agrees to pay all expenses,  including reasonable attorney's
     fees, which the holder may incur upon default or at maturity.

8.   COVENANTS

     Colmena and any guarantor,  surety or endorser,  and all others who are, or
     who may become, liable for the payment hereof:

     (a)  Expressly consent to all extensions of time,  renewals,  postponements
          of time of payment of this Note, from time to time,  prior to or after
          the day that such  payments  become  due  without  notice,  consent or
          consideration to any of the foregoing; and

     (b)  Expressly  agree to the additional  release by Yankees of any party or
          person primarily liable herein or any portion of the Collateral.

9.   ENFORCEMENT

     (a)  No delay by the holder in enforcing  any  covenant or right  hereunder
          shall be  deemed a waiver of such  covenant  or right and no waiver by
          the holder of any particular provision hereof shall be deemed a waiver
          of any other  provision  or a  continuing  waiver  of such  particular
          provision,  and except as so expressly  waived,  all provisions hereof
          shall continue in full force and effect.

     (b)  This  Note  shall be  enforceable  in the  Courts fo  Broward  County,
          Florida and Colmena  consents to  jurisdiction  therein.

10.  SPECIAL WAIVERS

     The  undersigned,  and all guarantors and all endorsers,  hereby  severally
waive presentment for payment,  protest and notice of protest for non-payment of
this Note.

11.  TIMELINESS

     Time shall be of the essence.

                                    Page 82
<PAGE>

12.  LICENSE

     (a)  This form of Note is the property of Yankees .

     (b)  The use hereof by the Parties is authorized hereby solely for purposes
          of this  transaction,  and the use of this form of agreement or of any
          derivation  thereof  without  Yankees's  prior  written  permission is
          prohibited.

     In Witness  Whereof,  Colmena  has caused  this Note to be  executed on its
behalf by their duly authorized  representatives  as of the date first set forth
below.

Signed, Sealed and Delivered
         In Our Presence
                                                      Colmena Corp.
/s/Sally Ann Stroberg/s/

/s/ Cyndi Calvo/s/                      By:   /s/Edward C. Dmytryk/s/
                                                 Edward C. Dmytryk, President
Dated:   September 30, 2001

[Corporate Seal]                       Attest:/s/Vanessa H. Lindsey/s/
                                                 Vanessa H. Lindsey, Secretary

STATE OF FLORIDA           }
COUNTY OF MARION           } SS.:

     BEFORE ME, an officer duly authorized to administer  oaths,  did personally
appear on this 30th day of  September,  2001,  Edward C.  Dmytryk and Vanessa H.
Lindsey,  known to me who,  being duly  sworn,  did state that they are the duly
elected  and  serving  president  and  secretary  of Colmena  Corp.,  a Delaware
corporation  ("Colmena"),  and that pursuant to authority  duly delegated by its
board of  directors,  they  executed  the  foregoing  Note on behalf of Colmena,
effective as of the date set forth therein. My commission expires:

         [NOTARIAL SEAL]
                                                 /s/Sally Ann Stroberg/s/
                                                 Notary Public

                                     Page 83

<PAGE>Exhibit 4.1

                              STAKE TECHNOLOGY LTD.

                             2001 STOCK OPTION PLAN

The purpose of the Stake Technology Ltd. 2001 Stock Option Plan (the "Plan") is
to have options available to grant to the employees, directors and consultants
of Stake Technology Ltd. and its subsidiaries. Such a Plan is vital to ensure
the long-term retention of employees, directors and consultants. Stock option
plans develop the interest and incentive of employees of the companies that
Stake Technology Ltd. ("Stake") and its subsidiaries (the "Company") may acquire
by providing them with an opportunity to purchase common shares of the Company,
thereby advancing the interests of the Company and its shareholders.

Subject to shareholder approval, the 2001 Stock Option Plan was approved by the
Board of Directors ("Board") of the Company, on March 13, 2001 at which time up
to 1,000,000 common shares ("Common Shares") of the Company were reserved for
the Plan.

                                    The Plan

1.    Purpose of the Plan

      An option granted under the Plan provides an employee, director or
      consultant of Stake or its subsidiaries with the opportunity to purchase
      common shares of the Company.

2.    Definitions

      In this Plan:

      "Date of Exercise" means the date upon which an Eligible Person returns a
      completed Option purchase form to the Company together with payment in
      full for the number of Optioned Shares such employee, director or
      consultant is purchasing pursuant to such form;

      "Eligible Person" means an employee, director or consultant of Stake or
      its subsidiaries at the time of the grant of an option;

      "Eligible Company" means Stake Technology Ltd. or any of its subsidiaries.

      "Option" means the right granted under this Plan to an Eligible Person to
      purchase a specified number of common shares of the Company pursuant to
      the provisions of the Plan;

      "Option Exercise Form" means the form required to be delivered by the
      Eligible Person in order to exercise on Optioned Shares.

      "Option Committee" means the committee chosen by the Board of the Company
      to administer this Plan;

      "Optionee" means an Eligible Person, director or consultant of the Company
      who has been granted an Option pursuant to this Plan;

      "Option Period" means, unless otherwise provided by the Board of Directors
      of the Company, that period during which an Optionee granted an Option may
      purchase Optioned Shares commencing on the date approved by Shareholders
      and ending March 13, 2011.

      "Option Price" means the price per share at which an Optionee may purchase
      Optioned Shares;

      "Optioned Shares" means those Common Shares in respect of which an Option
      is granted to an Optionee under this Plan; and

      "Plan" means this 2001 Stock Option Plan;

      "Vested Options" means those Options that are eligible for exercise by the
      Eligible Person.
<PAGE>

3.    Eligibility

      The eligibility to participate in the Plan is at the discretion of the
      Option Committee.

4.    The number of Shares to which an Optionee is Entitled under the Plan

      The Option Committee shall determine the number of Optioned Shares in
      respect of which an Option is granted at the time of the grant of the
      Option.

5.    Purchase Price for Optioned Shares

      The purchase price of Optioned Shares comprised in an Option granted under
      the Plan shall be equal to 100% of the fair market of the common shares
      based on the closing price on the trading day prior to the grant date as
      determined by the Board of the Company at the time of the grant of the
      Option in accordance with the policies of any applicable regulatory
      authority.

6.    Exercise of Option

      Each Option granted under the Plan shall vest at such time or times as may
      be determined by the Board or the Option Committee and no rights under the
      Plan or any Option shall accrue to any Optionee in any Optioned Shares
      forming the subject matter of an Option prior to the vesting date of such
      Option.

      The Option Committee will decide the vesting date of the Options granted
      to the Optionee under the Plan at the time of grant pursuant to Article 12
      hereof.

      The right of exercise shall be cumulative and any Optionee, if still an
      Eligible Person of an Eligible Company, may exercise the Option in respect
      of any Optioned Shares, which have vested at any time during the Option
      Period subject to the provisions of Articles 10 and 11 hereof.

      In order to purchase Optioned Shares under the Plan, an Optionee shall
      complete and execute an Option Exercise Form in the form of Schedule 1
      attached hereto and deliver it to the Company together with a certified
      cheque for the full purchase price of the Optioned Shares being acquired.

      Subject to the prior vesting of Optioned Shares or as otherwise determined
      by the Option Committee, an Optionee can exercise all or any part of the
      Option at any time.

7.    Optionee Commitment

      An Optionee has no obligation to purchase any or all of the Optioned
      Shares at any time but, to the extent an Optionee exercises the Option,
      the full purchase price of the Optioned Shares purchased pursuant to such
      exercise must be paid in full as set out under "Exercise of Option" above.

8.    Share Certificates

      The Company will deliver a share certificate representing the Optioned
      Shares purchased pursuant to exercise of an Option as soon as reasonably
      possible after the exercise thereof.

9.    Transfer and Assignment

      No Option or any of the rights thereunder is assignable or transferable by
      an Optionee at any time during the Optionee's lifetime. Upon the exercise
      of an Option, the Optionee may sell or otherwise dispose of such shares in
      any manner that the Optionee wishes in any jurisdiction in which the same
      are qualified for sale and subject to any regulatory authority having
      jurisdiction over such sale.

10.   Termination for any Reason other than Death

      If an Optionee is terminated, resigns, or otherwise severs his or her
      relationship with the Company at any time before the end of the Option
      Period for any reason other than the death of such Optionee, such Optionee
      may, at any time during the 30 day period immediately next following the
      date of such termination of employment, excluding the date of termination,
      purchase all or any part of the Optioned Shares which have vested to him
      or her and which he or she is entitled to purchase under the Option in the
      manner provided in the Plan. At 5:00 o'clock in the afternoon, local time,
      on such 30th day, if such day be a business day, such Option shall fully
      cease and determine and all rights of such Optionee thereunder shall
      cease, or, if such day shall not be a business day at 5:00 o'clock in the
      afternoon, local time, on the business day next following.

<PAGE>

      If through the operation of Article 6 hereof, none of the Optioned Shares
      shall have vested in such Optionee, the provisions of Article 6 hereof
      shall prevail and such Optionee shall not be entitled to purchase any
      Optioned Shares notwithstanding the provisions of this Article.

      Transfer by the Optionee to a subsidiary of the Company or any other
      Company affiliated with it or from such subsidiary or affiliate to the
      Company shall be deemed not to be a termination of employment under this
      Article and all rights of the Optionee under such Option shall continue in
      full force and effect after such transfer.

11.   Termination by Reason of Death

      If any Optionee shall die prior to the end of the Option Period and
      subject to Article 6 herein, before such Optionee has purchased all of the
      Vested Options to him or her, the exercise date, with respect to any
      unexercised portion of a Vested Option provided in Article 6 hereof and
      such Optionee's appointed executor or beneficiary may purchase all or any
      portion of the Vested Options of such deceased Optionee as provided in
      this Plan at any time during the shorter of, the Option Period or 180 days
      immediately following the death of the Optionee excluding the date of
      death if such day be a business day or, if such day shall not be a
      business day, on the business day next following.

12.   Administration of the Plan

      The Option Committee shall administer the Plan. The Option Committee has
      been delegated the authority by the Board of the Company to designate
      those employees, consultants and directors of Sunrich or future business
      interest that Stake may acquire in the near term who are to be granted
      Options in the Plan, the number of Optioned Shares to be granted to each
      such Optionee and otherwise to administer and interpret the Plan and the
      Options granted thereunder. The Board may amend, modify or terminate the
      Plan or any Option granted thereunder in respect of any Optioned Shares
      which shall not have become vested in an Optionee pursuant to the
      provisions of the Plan at any time without notice, but no such amendment,
      modification or termination shall divest any rights under any Option which
      shall have become vested in any Optionee.

      Any determination of the Option Committee shall be final and conclusive,
      unless the Board of the Company overrules any such determination, in which
      case the decision of the Board shall be final, conclusive and binding.

      The Option Committee may delegate the day to day administration of the
      Plan to an officer of the Company.

13.   Changes Affecting Optioned Shares

      In the case of any reorganization or recapitalization of the Company (by
      reclassification of its outstanding capital stock), or its consolidation
      or merger with or into another corporation, or the sale, conveyance, lease
      or other transfer by the Company of all or substantially all of its
      property, pursuant to any of which events the then outstanding shares of
      the Company's capital are consolidated or subdivided, or are changed into
      or become exchangeable for other shares or securities, the Optionee, upon
      exercise of his or her Option, shall be entitled to receive in lieu of the
      Optioned Shares which he or she would otherwise have been entitled to
      receive upon such exercise and without any payment in addition to the
      Option Price therefor, the shares or securities which the Optionee would
      have received upon such reorganization, recapitalization, consolidation,
      subdivision, merger, sale or other transfer, as if immediately prior
      thereto he or she had owned the Optioned Shares to which such exercise of
      the Option relates and had exchanged such Optioned Shares in accordance
      with the terms of such reorganization, recapitalization, consolidation,
      subdivision, merger, sale or other transfer.

      Notwithstanding the foregoing provisions of this Article 13, no adjustment
      provided for herein shall require the Company to deliver a fractional
      share or other security under the Option.

14.   Employment

      The granting of an Option to any person under the Plan will not confer any
      rights upon such Optionee other than those provided in the Plan and,
      without limiting the generality of the foregoing, will not confer or be
      deemed to confer upon any such Optionee any right to continue as an
      employee, director or consultant of the Company, or any subsidiary or
      affiliate thereof.

15.   No Shareholder Right

      The granting of an Option pursuant to the Plan will not confer any rights
      upon any Optionee as a shareholder of the Company, nor the right to
      receive notice of, attend nor vote at any meeting of shareholders of the
      Company until the exercise of an Option and such rights shall extend only
      to those number of Optioned Shares in respect of which the Option was
      exercised.
<PAGE>

16.   Governing Law

      This Plan is established under the laws of the Province of Ontario and the
      rights of all parties and the construction and effect of each provision of
      the Plan shall be governed by the laws of the Province of Ontario; except
      in respect to any sale of any of the common shares in respect of which an
      Option has been exercised which shall be governed by the laws of the
      jurisdiction in which an Optionee proposes to sell such shares.

17.   Termination of the Plan

      The Plan will terminate on March 13, 2011 unless otherwise determined by
      the Option Committee unless all of the Options granted under the Plan are
      exercised, in which case the Plan will terminate on the date all of the
      Options granted under the Plan have been exercised.

IN WITNESS WHEREOF, subject to shareholder approval, the Company has executed
this Plan as of March 13, 2001.

STAKE TECHNOLOGY LTD.

"J.N. Kendall"                               "Leslie N. Markow"

J. N. Kendall, Chairman and CEO         Leslie N. Markow, CFO and Assistant
                                        Corporate Secretary
<PAGE>

SCHEDULE 1

                          To the STAKE TECHNOLOGY LTD.

                             2001 Stock Option Plan

To: Stake Technology Ltd.

And to: American Stock Transfer and Trust Company

                              OPTION EXERCISE FORM

The undersigned hereby subscribes for _____________ Common Shares of Stake
Technology Ltd. (the "Company") which the undersigned is entitled to pursuant to
the provisions of the Stake Technology Ltd. 2001 Stock Option Plan.

I attach my cheque payable to the Company in the sum of $______________________,
representing the purchase price of the said Shares.

Dated at _________________________, this __________ day of ____________________,
200_.

Name:    _________________________      SIN:____________________________________

Address: _________________________      or

         _________________________      S.S.:___________________________________
         _________________________

         _________________________

                                        Signature:______________________________

Please call Leslie Markow -at (905) 455-1990 x 109 if you wish to exercise any
of your options.

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