Document:

<PAGE>   1
                                                                   EXHIBIT 10.43

                               FOURTH AMENDMENT TO
                           LOAN AND SECURITY AGREEMENT

         THIS FOURTH AMENDMENT TO LOAN AND SECURITY AGREEMENT dated as of
December 16, 1999 (the "FOURTH AMENDMENT"), is by and between TEXTRON FINANCIAL
CORPORATION, a Delaware corporation (the "LENDER"), and SILVERLEAF RESORTS, INC.
(formerly known as SILVERLEAF VACATION CLUB, INC.), a Texas corporation (the
"BORROWER")

                              W I T N E S S E T H:

         WHEREAS, Borrower was formerly known as ASCENSION CAPITAL CORPORATION
(the "GUARANTOR"), the successor to ASCENSION RESORTS, LTD., a Texas limited
partnership (the "ORIGINAL BORROWER"), by merger of EQUAL INVESTMENT COMPANY, a
Texas corporation, ASCENSION RESORTS, LTD. and ASCENSION CAPITAL CORPORATION;

         WHEREAS, Lender, Original Borrower and Guarantor were parties to that
certain Loan and Security Agreement dated as of August 15, 1995, pursuant to
which the Original Borrower executed its Secured Promissory Note in favor of the
Lender in the amount of $5,000,000.00, as amended to date (the "NOTE");

         WHEREAS, on December 28, 1995 Ascension Resorts, Ltd. was merged into
the Guarantor and Guarantor was thereafter renamed Silverleaf Vacation Club,
Inc.;

         WHEREAS, on December 28, 1995, Lender, Borrower and Guarantor amended
the Agreement, as such term is hereafter defined, pursuant to a First Amendment
to Loan and Security Agreement dated as of December 28, 1995 (the "FIRST
AMENDMENT") to, among other things, evidence Lender's approval of the merger of
Ascension Resorts, Ltd. into Ascension Capital Corporation and to reflect the
above-mentioned merger and name change;

         WHEREAS, on October 31, 1996, Lender and Borrower further amended the
Agreement pursuant to a Second Amendment to Loan and Security Agreement dated as
of October 31, 1996 (the "SECOND AMENDMENT") to, among other things, increase
the amount of the Loan, decrease the interest rate, and extend the maturity date
of the Loan;

         WHEREAS, pursuant to a commitment letter dated January 26, 1999, Lender
and Borrower agreed, among other things, to further modify the terms of the
Agreement to, among other things, increase the amount of the Loan, decrease the
interest rate, extend the maturity date of the Loan and to reflect the change in
Borrower's name to Silverleaf Resorts, Inc.;

         WHEREAS, Lender and Borrower further amended the Agreement pursuant to
a Third Amendment to Loan and Security Agreement dated as of March 31, 1999 (the
"THIRD AMENDMENT") to amend the Agreement as provided in the January 26, 1999
commitment letter; and

<PAGE>   2

         WHEREAS, Lender and Borrower have agreed to enter into this Fourth
Amendment to Loan and Security Agreement dated as of December 16, 1999 (the
"FOURTH AMENDMENT") to, among other things, modify the definitions of Borrowing
Base and Eligible Notes Receivable.

         NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby agree as
follows:

1.       ADDITIONAL CREDIT FACILITY. Section 1.1 (Definitions) is hereby amended
in part to add the following new paragraph:

                  "(a) ADDITIONAL CREDIT FACILITY. The term "Additional Credit
                  Facility shall mean that certain $75,000,000 credit facility
                  provided by Lender to Borrower pursuant to that certain Loan,
                  Security and Agency Agreement dated of even date herewith (the
                  "Additional Credit Loan Agreement") by and between Borrower
                  and Lender."

2.       AGREEMENT. Section 1.1(d) (Agreement) is hereby amended to read as
follows:

                  "(e) AGREEMENT. This Loan and Security Agreement by and among
                  the Borrower and the Lender (including the Exhibits and
                  Schedules attached hereto), as amended by the First Amendment,
                  the Second Amendment, the Third Amendment and the Fourth
                  Amendment, as it may be further amended from time to time."

3.       BORROWING BASE. Section 1.1(f) (Borrowing Base) is hereby amended to
read as follows:

                  "(g) BORROWING BASE. With respect to each Eligible Notes
                  Receivable pledged to the Lender in connection with each
                  Advance, including any Advance made prior to the date of the
                  Fourth Amendment, an amount equal to: (i) eighty-five percent
                  (85%) of the remaining principal balance of each such Eligible
                  Note Receivable having a maximum term of ninety-six months or
                  less; (ii) eighty percent (80%) of the remaining principal
                  balance of each such Eligible Note Receivable having a term
                  greater than ninety-six months but less than one hundred
                  twenty months or (iii) seventy-five percent (75%) of the
                  principal balance of each such Eligible Note Receivable which
                  is a Zero Payment Eligible Note Receivable, as such term is
                  hereinafter defined, provided that upon submission to Lender
                  by Borrower of satisfactory written evidence that the first
                  monthly payment with respect to a Zero Payment Eligible Note
                  Receivable has been received by Borrower, the Borrowing Base
                  shall, with respect to such Zero Payment Eligible Note
                  Receivable, be increased to: (y) eighty-five percent (85%) of
                  the remaining principal balance of each such Zero Payment
                  Eligible Note Receivable having a maximum term of ninety-six
                  months or less or (z) eighty percent (80%) of the remaining
                  principal balance of each such Eligible Note Receivable having
                  a term greater than ninety-six months but less than one
                  hundred twenty months."

4.       COLLATERAL. Section 1.1(j) (Collateral) is hereby amended in part as
follows:

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<PAGE>   3

                           "(k) COLLATERAL. Collectively, all now owned or
                  hereafter acquired right, title and interest of the Borrower,
                  in all of the following:

                           (i) Pledged Notes Receivable and all proceeds of or
                  from them;

                           (ii) Mortgages and all proceeds of or from them;

                           (iii) Documents, instruments, accounts, chattel
                  paper, and general intangibles relating to the Pledged Notes
                  Receivable and the Mortgages;

                           (iv) Extensions, additions, improvements,
                  betterments, renewals, substitutions and replacements of, for
                  or to any of the Collateral, wherever located, together with
                  the products, proceeds, issues, rents and profits thereof, and
                  any replacements, additions or accessions thereto or
                  substitutions thereof;

                           (v) All books, records, reports, computer tapes,
                  disks and software relating to the Collateral; and

                           (vi) All Collateral under the Additional Credit
                  Facility and the Inventory Loan, as such term is hereinafter
                  defined.

5.       ELIGIBLE NOTES RECEIVABLE. Sections 1.1(s) (vii) and (xi) and the last
paragraph of Section 1.1(s) (Eligible Notes Receivable) are hereby amended to
read as follows:

                            "(vii) which shall have an original term of no more
                            than one hundred twenty (120) months;"

                            "(xi) the rate of interest payable on the unpaid
                            balance is at least the rate required so that when
                            the Advance is made in respect of such Eligible Note
                            Receivable the average interest rate on all Eligible
                            Notes Receivable in respect of which Advances are
                            outstanding shall not be less than twelve and
                            one-half percent (12.5%) per annum at any time;"

                  Notwithstanding anything herein to the contrary, the Lenders
shall be under no obligation to make Advances in respect of:

                           (i) Crown Resorts Notes Receivable (i.e. Notes
                  Receivables relating to intervals at the Crown Resorts listed
                  on Schedule 4.5(c)(iii)) if Advances have already been made
                  under this Loan and the Existing Credit Facility, in total, in
                  respect of 681 Crown Resorts Notes Receivable, exclusive of
                  [x] Notes Receivable relating to intervals at the Quail Hollow
                  Resort and [z]any other Crown Resort Notes Receivable for
                  which Borrower shall have delivered to Agent an acceptable
                  Mortgagee Title Insurance Policy insuring the Mortgage
                  securing such Crown Resort Note Receivable; and

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<PAGE>   4

                           (ii) Notes Receivable from Oak N' Spruce Resort if
                  any such Advance, together with any prior Advances made under
                  this Loan Agreement, the Additional Credit Facility and/or the
                  Inventory Loan would exceed, in the aggregate, $32,000,000.00.

6.       INVENTORY LOAN. Section 1.1 (Definitions). is hereby amended in part to
add the following new paragraph:

                     "(jj) INVENTORY LOAN. The term Inventory Loan shall mean
                     that certain $10,000,000 time share interval inventory loan
                     made or to be made by Lender to Borrower, and all documents
                     executed and/or delivered by Borrower in connection
                     therewith.

7.       LOAN DOCUMENTS. Section 1.1 (ll) (Loan Documents) is hereby amended to
read as follows:

                     "(oo) LOAN DOCUMENTS. Collectively, this Agreement, as
                     amended by the First Amendment, the Second Amendment, the
                     Third Amendment and the Fourth Amendment, the Note, the
                     Environmental Indemnification Agreement, the Negative
                     Pledge Agreement, the Assignment of Notes Receivable and
                     Mortgages, the Lock Box Agreement, the UCC Financing
                     Statements and such other agreements, documents,
                     instruments, certificates and materials as Lender may
                     request to evidence the Obligations, to evidence and
                     perfect the rights and Liens and security interests of
                     Lender contemplated by the Loan Documents and to effectuate
                     the transactions contemplated herein, as such agreements,
                     documents, instruments or certificates may be hereafter
                     amended, renewed, extended, restated or supplemented from
                     time to time."

8.       NOTE.  Section 1.1(ss) (Note) is hereby amended to read as follows:

                     "(vv) NOTE. The Secured Promissory Note evidencing the Loan
                     dated the Closing Date executed and delivered by Borrower
                     to Lender concurrently with the Agreement, as amended and
                     restated by an Amended and Restated Secured Promissory Note
                     dated as of October 31, 1996, as further amended and
                     restated by an Amended and Restated Secured Promissory Note
                     dated March 31, 1999 and as further amended and restated by
                     an Amended and Restated Secured Promissory Note dated
                     December 16, 1999 executed and delivered by Borrower to
                     Lender concurrently with the Fourth Amendment, a copy of
                     which is attached hereto as Exhibit C."

9.       ZERO PAYMENT ELIGIBLE NOTE RECEIVABLE. Section 1.1 (Definitions). is
hereby amended in part to add the following new paragraph:

                     "(sss) ZERO PAYMENT ELIGIBLE NOTE RECEIVABLE. The term Zero
                     Payment Eligible Note Receivable shall mean a Pledged Note
                     Receivable which satisfies all of the criteria set forth in
                     the definition contained herein of Eligible Note
                     Receivable,

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<PAGE>   5

                     except that the first monthly payment under the Pledged
                     Note Receivable is not due and payable as of the date of
                     the Advance in question."

10.      SUSPENSION OF ADVANCES. Section 2 of the Loan is hereby amended in part
to add the following new Section 2.9:

         "2.9   SUSPENSION OF ADVANCES.

              (a) Suspension of Sales. If any stay, order, cease and desist
         order, injunction, temporary restraining order or similar judicial or
         nonjudicial sanction shall be issued limiting or otherwise materially
         adversely affecting any Interval sales activities, other business
         operations in respect of the Resorts, or the enforcement of the
         remedies of the Lender hereunder, then, in such event, the Lender shall
         have no obligation to make any Advances hereunder: (i) in respect of
         Pledged Notes Receivable from the sale of Intervals which are the
         subject of any stay, order, cease and desist order, injunction,
         temporary restraining order or similar judicial or nonjudicial sanction
         has been issued until the stay, order, cease and desist order,
         injunction, temporary restraining order or similar judicial or
         nonjudicial sanction has been lifted or released to the satisfaction of
         the Lender and (ii) in respect of Pledged Notes Receivable from the
         sale of Intervals at any Resort if: (x) the stay, order, cease and
         desist order, injunction, temporary restraining order or similar
         judicial or nonjudicial sanction in question has not been lifted or
         released to the satisfaction of the Lender within sixty (60) days of
         its issuance and (y) there is a reduction in the total number of sales
         of Intervals by the Borrower in any Loan Year of more than twenty
         percent (20%) from the total number of sales of Intervals in the
         immediately preceding Loan Year.

              (b) Change in Control. If there shall occur a change, singly or in
         the aggregate, of more than fifty percent (50%) of the executive
         management of the Borrower as described in Schedule E hereto, the
         Lender shall have no obligation to make any Advances hereunder, unless
         within thirty (30) days prior thereto Borrower provides Lender with
         written information setting forth the replacement executive management
         personnel of Borrower together with a description of those Persons'
         experience, ability and reputation, and Lender, acting in good faith,
         determines that the replacement management personnel's experience,
         ability and reputation is equal to or greater than that of the Borrower
         as set forth on Schedule E."

11.      GENERAL REPRESENTATIONS AND WARRANTIES. Section 6.20 (Operating
Contracts) is hereby deleted in its entirety and in its place instead is
substituted the following:

                  "6.20 OPERATING CONTRACTS. The contracts, agreements and
                  arrangements necessary, in Lender's reasonable judgement, for
                  the operation of the Resorts, including, but not limited to,
                  those with respect to utilities, maintenance, management,
                  services, marketing and sales (the "Operating Contracts") are
                  unmodified and in full force and effect and shall remain free
                  and clear of any Lien."

12.      COVENANTS. Section 7.1(c) (Consolidation and Merger) is hereby amended
as follows:

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<PAGE>   6

                     "Borrower will not consolidate with or merge into any other
                     Person or permit any other Person to consolidate with or
                     merge into it, unless: (i) Borrower is the continuing or
                     surviving corporation in any such consolidation or merger,
                     and (ii) prior to and immediately after such consolidation
                     or merger, Borrower shall not be in default hereunder."

13.      COVENANTS. Section 7.1(h)(iv) (Officer's Certificate) is hereby amended
in part to add the following new sentence:

                     "The aforementioned Officer's Certificate shall be in the
                     form attached here as Exhibit C."

14.      COVENANTS. Section 7.1(l) (Operating Contracts) is hereby deleted in
its entirety and in its place instead is substituted the following:

                  "(l) OPERATING CONTRACTS. Subject to the rights of the
                  Timeshare Owners' Association as set forth in the Timeshare
                  documents, no Operating Contract shall be modified, extended,
                  terminated or entered into, without the prior written approval
                  of the Lender, if any such modification, extension,
                  termination or new agreement would have a material adverse
                  effect on the operation of the Resort or the Collateral.

15.      COVENANTS. Section 7.2((b) (D) is hereby deleted in its entirety.

16.      EVENTS OF DEFAULT. Section 8.1(n) (Death or Disability of Robert Mead
or Default of Guarantor) is hereby deleted in its entirety.

17.      EVENTS OF DEFAULT. Section 8.1(p) (Suspension of Sales) is hereby
deleted in its entirety and Section 8.1(q) (Violation of Negative Covenants) is
hereby redesignated as Section 8.1(o).

18.      MODIFICATION OF ELIGIBLE NOTES RECEIVABLE. Section 44 (Modification of
Eligible Notes Receivable) of the Third Amendment is hereby amended to read as
follows:

                     "Notwithstanding anything herein to the contrary, Borrower
                     shall have the right to modify the interest rate and term
                     only of the Eligible Notes Receivable without the Lender's
                     prior consent, provided that: (i) any such change in the
                     rate of interest on any one or more Eligible Notes
                     Receivable shall not reduce the average interest rate on
                     all Eligible Notes Receivable to less than twelve and one
                     half percent (12 1/2 %) per annum at any time; (ii) the
                     term of no Eligible Notes Receivable shall be increased to
                     a term longer than one hundred twenty (120) months from its
                     original date; (iii) at no time may the Borrower so modify
                     the terms of more than fifteen percent (15%) of the
                     outstanding principal balance of all Eligible Notes
                     Receivable at any time; (iv) Borrower immediately provide
                     Lender with notice of any such modification together with
                     any original documentation evidencing such modification and
                     (v) no Eligible Note Receivable is modified more than once
                     in any twelve (12) month period or more than twice during
                     the term of such Eligible Note Receivable."

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<PAGE>   7

19.      ASSUMPTION OF OBLIGATIONS UNDER ELIGIBLE NOTES RECEIVABLE.
Notwithstanding anything herein to the contrary, upon the sale by a Purchaser of
an Interval, the new Purchaser of the Interval may be substituted as obligor
under the Eligible Note Receivable in question, provided that: (i) said new
Purchaser assumes in writing all of the obligations of the original obligor
under the Eligible Note Receivable in question; (ii) the Eligible Note
Receivable continues to meet all of the criteria for an Eligible Note Receivable
as set forth herein and (iii) the new Purchaser has made a cash down payment
equal to at least 10% of the original sales price of the Interval in question,
which down payment shall be in addition to the cash down payment made by the
original obligor.

20.      EXHIBITS AND SCHEDULE. Exhibits A and B are hereby deleted in
their entirety and in their place and stead is substituted Exhibits A and B as
attached to the Fourth Amendment.

21.      DEFINITIONS. Sections 1.1 (a), (b), (c), (e), (g), (h), (i), (l), (m),
(n), (o), (p), (q) (r), (s), (t), (u), (v), (w), (x), (y), (z), (aa), (bb),
(cc), (dd), (ee), (ff), (gg), (hh), (ii), (jj), (kk), (mm), (nn), (oo), (pp),
(qq), (rr), (ss), (tt), (uu), (vv), (ww), (xx), (yy), (zz), (aaa), (bbb), (ccc),
(ddd), (eee), (fff), (ggg), (hhh), (iii), (jjj), (kkk), (lll), (mmm), (nnn) and
(ooo) are hereby redesignated as Sections 1.1 (b), (c), (d), (f), (h), (i), (j),
(m), (n), (o), (p), (q), (r), (s), (t), (u), (v), (w), (x), (y), (aa), (bb),
(cc), (dd), (ee), (ff), (gg), (hh), (ii), (kk), (ll), (mm), (nn), (pp), (qq),
(rr), (ss), (tt), (uu), (vv), (ww), (xx), (yy), (zz), (aaa), (bbb), (ccc),
(ddd), (eee), (fff), (ggg), (hhh), (iii), (jjj), (kkk), (lll), (mmm), (nnn),
(ooo), (ppp), (qqq) and (rrr) respectively. All capitalized terms used herein
but not otherwise defined herein shall have the meanings ascribed to such terms
in the Agreement.

22.      FURTHER DOCUMENTATION. Borrower agrees to execute and deliver to Lender
any and all additional documentation as Lender may now or hereafter require in
order to effectuate the terms and conditions of this Fourth Amendment.

23.      EFFECT OF AMENDMENT. Except as herein expressly amended, the Agreement
shall remain in full force and effect.

24.      RATIFICATION AND CONFIRMATION. Except as herein expressly amended,
Borrower hereby ratifies, confirms, assumes and agrees to be bound by all of
representations, warranties, statements, covenants and agreements set forth in
the Agreement and the other Loan Documents, as previously amended by the First
Amendment, the Second Amendment and the Third Amendment. The Borrower reaffirms,
restates and incorporates by reference all of the representations, warranties,
covenants and agreements made in the Loan Documents as if the same were made as
of this date. The Borrower agrees to pay the Loan and all related expenses, as
and when due and payable in accordance with the Loan Agreement and the other
Loan Documents, and to observe and perform the Obligations, and do all things
necessary which are not prohibited by law to prevent the occurrence of any Event
of Default. In addition, to further secure, and to evidence and confirm the
securing of, the prompt and complete payment and performance by the Borrower of
the Loan and all of the Obligations, for value received, Borrower
unconditionally and irrevocably assigns, pledges and grants to Lender, and
hereby confirms or reaffirm the prior granting to Lender of, a continuing first
priority Lien, mortgage and security interest in and to all of the Collateral,
whether now existing or hereafter acquired. Also, as provided in the Loan
Documents, the Loan is and shall be further secured by the Liens and security
interests in favor of Lender in the properties and interests relating to
Additional Eligible Resorts, which now or hereafter serve as collateral security
for any Obligations. On the date of the

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<PAGE>   8

Fourth Amendment and thereafter upon satisfaction of the requirements for
approval by Lender of Additional Resorts, Borrower shall record, or cause to be
recorded, such mortgages, deeds of trust, deeds to secure debt, assignments,
pledges, security agreements and UCC Financing Statements in the appropriate
public records of the state in which each Resort is located to further evidence
and perfect the Lender's Lien on the Collateral. Borrower agrees to deliver or
cause to be delivered by its Affiliates, such mortgages, deeds of trust, deeds
to secure debt, assignments, pledges, security agreements and UCC Financing
Statements as Lender may deem necessary to further evidence and perfect the
Lender's Lien on the Collateral.

25.      ESTOPPEL. Borrower acknowledges, agrees and confirms that: (a) Advances
under the Loan Agreement have been made prior to the date of the Fourth
Amendment; (b) all such Advances made prior to the Closing Date were made in
favor of the Original Borrower and the Borrower in respect of the Existing
Eligible Resorts; (c) Advances made prior to the date of the First Amendment
under the Loan Agreement are deemed as having been made for the benefit of the
Borrower and Borrower acknowledges and agrees that Borrower received a direct
and substantial financial benefit from such Advances and (d) immediately prior
to the date of the Fourth Amendment, and without giving effect to any Advances
that may be made pursuant to the Fourth Amendment, the status of the Loan,
including the outstanding principal balance thereof is as reflected in the Loan
Funding Report delivered to and approved by Lender in connection with the
closing of the Fourth Amendment, a copy of which is attached as Exhibit B.

         The Loan constitutes valuable consideration to the Borrower, which
consideration is uninterrupted and continuous since the dates on which the Loan
was first made. This Fourth Amendment and the other Loan Documents and the Loan
modifications and transactions provided for or contemplated hereunder or
thereunder, shall in no way adversely affect the Lien or perfection or priority
of any Lien of Lender as of the date hereof in and to any Collateral, and are
not intended to constitute, and do not constitute or give rise to, any novation,
cancellation or extinguishment of any of Borrower's Obligations existing as of
the Closing Date to Lender, or of any interests owned or held by Lender (and not
previously released) in and to any of the Collateral; it being the intention of
the parties that the transactions provided for or contemplated herein shall be
effectuated without any interruption in the continuity of the value and
consideration received by Borrower, and of the attachment, perfection, priority
and continuation in favor of Lender in and to all Collateral and proceeds.

26.      EFFECTIVE DATE. This Fourth Amendment shall be effective commencing as
of the later of: (1) December 7, 1999, or (2) the satisfaction of the terms of
the Fourth Amendment Commitment (which satisfaction shall be evidenced by notice
from Lender or Lender's counsel to the Borrower or the Borrower's counsel,
respectively).

27.      MAXIMUM OBLIGATION OF LENDER UNDER THE LOAN, THE ADDITIONAL CREDIT
FACILITY AND THE INVENTORY LOAN. Borrower acknowledges, agrees and confirms that
notwithstanding anything to the contrary herein, in any other Loan Document or
in any document evidencing or securing the Additional Credit Facility or the
Inventory Loan, Lender shall not be obligated to fund any Advance hereunder,
which when taken together with the loans or advances made by the Lender to the
Borrower under this Agreement, the Additional Credit Facility or the Inventory
Loan, would cause the aggregate amount of

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<PAGE>   9

such loans and advances by the Lender to Borrower to exceed a maximum aggregate
amount of $50,000,000.

28.      CROSS DEFAULT TO INVENTORY LOAN AND ADDITIONAL CREDIT FACILITY.
Notwithstanding anything to the contrary in the Agreement, any default by the
Borrower under the Additional Credit Facility and/or the Inventory Loan shall
also be a default under this Agreement.

29       ADDITIONAL FUNDING REQUIREMENT FOR OAK N' SPRUCE. Section 5 (b) (ii) of
the Agreement ("Loan Documentation/Collateral") is here by amended as follows:

               (i)  In the seventh line of Subsection 5(b) (ii), delete the word
                    "and" after the word "Mortgages".

               (ii) Add the following at the end of Subsection 5(b) (ii):

                    "and (E) with respect to each Eligible Note Receivables from
                    the sale of Intervals at Oak N' Spruce: (i) the original
                    UCC-1 Financing Statement, naming the Purchaser of the
                    Interval giving rise to the Eligible Note Receivable as
                    debtor and the Borrower as secured party (the "PURCHASER
                    FINANCING STATEMENT"), perfecting Borrower's security
                    interest in the applicable Interval to secure the
                    Purchaser's obligations under the Eligible Note Receivable
                    and (ii) a UCC-3 Assignment, naming the Borrower as assignor
                    and the Agent as assignee on behalf of the Lenders,
                    assigning to the Agent, on behalf of the Lenders, all of the
                    Borrower's right, title and interest under each Purchaser
                    Financing Statement."

30.      FORM OF COLLATERAL ASSIGNMENT OF NOTES RECEIVABLE AND INTERVAL
MORTGAGES. From and after the date hereof, for purposes of Section 5(b)(iii) of
the Agreement, the Assignment of Notes Receivable and Mortgages shall be in the
form attached here as Exhibit F1 and any amendment to any such previously
recorded assignment shall be in the form attached here as Exhibit F2

         IN WITNESS WHEREOF, the parties hereto have caused this Fourth
Amendment to be executed on their behalf as of the day and year first written
above.

Witnessed By:

<TABLE>
<S>                                        <C>
/s/ MELISSA [ILLEGIBLE]                     TEXTRON FINANCIAL CORPORATION
-----------------------------------
                                            By: /s/ JOHN T. D'ANNEBALE
/s/ MARY PELLENGER                             ----------------------------
-----------------------------------         Name: John T. D'Annebale
                                            Its:  Asst. Vice President

                                            SILVERLEAF RESORTS, INC.
/s/ GEORGE R. BEDELL
-----------------------------------
                                            By: /s/ ROBERT E. MEAD
/s/ SANDRA CEARLEY                             ----------------------------
-----------------------------------         Name: Robert E. Mead
                                            Its:  Chief Executive Officer
</TABLE>

                                       9
<PAGE>   10

STATE OF CONNECTICUT       )
                           )      ss:  East Hartford
COUNTY OF HARTFORD         )

         At East Hartford in said County and State on this 16th day of December,
1999, personally appeared John T. D'Annebale, duly authorized Vice President of
Textron Financial Corporation, and he acknowledged the foregoing instrument by
him signed and sealed to be his free act and deed and the free act and deed of
Textron Financial Corporation.

         Before me:        /s/ CHRISTINE M. CORDEIRA
                           --------------------------------------
                           Notary Public in and for said State
                           My Commission Expires:  April 30, 2002
                           Commissioner of the Superior Court

STATE OF TEXAS             )
                           )      ss:
COUNTY OF DALLAS           )

         At Dallas in said County and State on this 8th day of December, 1999,
personally appeared Robert E. Mead, Chief Executive Officer, duly authorized
officer of SILVERLEAF RESORTS, INC., and he/she acknowledged the foregoing
instrument by him/her signed and sealed to be his/her free act and deed and the
free act and deed of Silverleaf Resorts, Inc., a Texas corporation, on behalf of
the corporation.

         Before me:        /s/ SANDRA G. CEARLEY
                           -----------------------------------
                           Notary Public in and for said State
                           My Commission Expires: 12-28-2002

                                     [SEAL]<PAGE>   1

                                                                   EXHIBIT 10.44

                          LOAN AND SECURITY AGREEMENT

                                     between
                            SILVERLEAF RESORTS, INC.
                                  (as Borrower)

                                       and

                          TEXTRON FINANCIAL CORPORATION
                                   (as Lender)

                             As of December 16, 1999

<PAGE>   2

                          LOAN AND SECURITY AGREEMENT

THIS LOAN AND SECURITY AGREEMENT, dated as of December 16, 1999, entered into by
SILVERLEAF RESORTS, INC., a Texas corporation, (as "Borrower"), and TEXTRON
FINANCIAL CORPORATION, a Delaware corporation as ("Lender").

                                   WITNESSETH:

WHEREAS, Borrower is engaged in the business of acquiring, constructing,
developing, owning, managing, selling and otherwise dealing with Intervals at
the Resorts (as each such term is hereafter defined);

WHEREAS, Borrower, in order to provide liquidity in connection with its
ownership, purchase and warehousing of Intervals, has entered into this
Agreement whereby Lender, will, subject to the terms and conditions set forth
herein, agree to make a loan to Borrower in the maximum amount of $10,000,000;

NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained in this Agreement, and for other good and valuable consideration, the
receipt and adequacy of which are acknowledged, the parties to this Agreement,
intending to be legally bound, agree as follows:

                        SECTION 1 -- DEFINITION OF TERMS

     1.1 Capitalized terms used in this Agreement are defined in this Section
1.1. The definitions include the singular and plural forms of the terms defined.

          (a) ADDITIONAL CREDIT FACILITY. The term "Additional Credit Facility"
     shall mean that certain $75,000,000 credit facility provided by the Lender
     and certain other parties to Borrower pursuant to that certain Loan,
     Security and Agency Agreement dated as of December 3, 1999.

          (b) ADDITIONAL ELIGIBLE RESORTS or ADDITIONAL ELIGIBLE RESORT. The
     terms "Additional Eligible Resorts" and "Additional Eligible Resort" shall
     have the meanings ascribed to such terms in Section 3.4 hereof.

          (c) ADVANCE. A portion of the proceeds of the Loan advanced by the
     Lender to the Borrower in accordance with the terms of this Agreement.

          (d) AFFILIATE. Any party controlled by, controlling, or under common
     control with, the Borrower.

                                       1
<PAGE>   3

          (e) AGREEMENT. This Loan and Security Agreement (including the
     Exhibits and Schedules to it), as it may be amended from time to time, by
     and between Borrower and the Lender.

          (f) BUSINESS DAY. Each day which is not a Saturday, a Sunday or a
     legal holiday under the laws of the State of Rhode Island, the State of
     Connecticut or the State of Texas.

          (g) CLOSING DATE. The date of this Agreement.

          (h) CODE. The Uniform Commercial Code in force in the State of Rhode
     Island as amended from time to time.

          (i) COLLATERAL. Collectively, all now owned or hereafter acquired
     right, title and interest of the Borrower, in all of the following:

               (i) The Inventory;

               (ii) All documents, instruments, accounts, and general
          intangibles relating to the Inventory;

               (iii) Any extensions, additions, improvements, betterments,
          renewals, substitutions and replacements of, for or to any of the
          Collateral, wherever located, now or hereafter owned by Borrower,
          together with the products, proceeds, issues, rents and profits
          thereof, and any replacements, additions or accessions thereto or
          substitutions thereof;

               (iv) All books, records, reports, computer tapes, disks and
          software relating to the Collateral; and

               (v) All collateral securing the Existing Credit Facility, as
          hereafter defined, and the Additional Credit Facility.

          (j) COMMITMENT FEE. The commitment fee in the amount of $100,000,
     which is to be paid in accordance with the terms of Section 2.6(a) hereof.

          (k) COMMON ELEMENTS. All common elements, including but not limited to
     any limited common elements, as each such common element is defined or
     provided for in the Declaration or other Timeshare Documents.

                                       2
<PAGE>   4

          (l) DEBTOR RELIEF LAWS. Any applicable liquidation, conservatorship,
     bankruptcy, moratorium, rearrangement, insolvency, reorganization or
     similar law, proceeding or device providing for the relief of debtors from
     time to time in effect and generally affecting the rights of creditors.

          (m) DECLARATION OR DECLARATIONS. With respect to each Resort, the
     applicable Declaration or Declarations described on Schedule 1.1(o)
     attached hereto.

          (n) DEFAULT. An event or condition the occurrence of which immediately
     is or, with a lapse of time or the giving or notice or both, becomes an
     Event of Default.

          (o) DEFAULT RATE. The term "Default Rate" shall have the meaning
     ascribed to such term in the Note.

          (p) DIVISION OR COMMISSION. The governmental authority of each state
     in which a Resort is located, having jurisdiction over the establishment
     and operation of the Resort in question and the sale of Intervals at such
     Resort.

          (q) ENVIRONMENTAL LAWS. Comprehensive Environmental Response,
     Compensation and Liability Act of 1980, as amended from time to time
     ("CERCLA"), the Resource Conservation and Recovery Act of 1976, as amended
     from time to time ("RCRA"), the Superfund Amendments and Reauthorization
     Act of 1986, as amended, the federal Clean Air Act, the federal Clean Water
     Act, the federal Safe Drinking Water Act, the federal Toxic Substances
     Control Act, the federal Hazardous Materials Transportation Act, the
     federal Emergency Planning and Community Right to Know Act of 1986, the
     federal Endangered Species Act, the federal Occupational Safety and Health
     Act of 1970, the federal Water Pollution Control Act, all state and local
     environmental laws, rules and regulations of each state in which a Resort
     is located, as all of the foregoing legislation may be amended from time to
     time, and any regulations promulgated pursuant to the foregoing; together
     with any similar local, state or federal laws, rules, ordinances or
     regulations either in existence as of the date hereof, or enacted or
     promulgated after the date of this Agreement, that concern the management,
     control, storage, discharge, treatment, containment, removal and/or
     transport of Hazardous Materials or other substances that are or may become
     a threat to public health or the environment; together with any common law
     theory involving Hazardous Materials or substances which are (or alleged to
     be) hazardous to human health or the environment, based on nuisance,
     trespass, negligence, strict liability or other tortious conduct, or any
     other federal, state or local statute, regulation, rule, policy, or
     determination pertaining to health, hygiene, the environment or
     environmental conditions.

                                       3
<PAGE>   5

          (r) ENVIRONMENTAL INDEMNIFICATION AGREEMENT. The term "Environmental
     Indemnification Agreement" shall mean the Environmental Indemnification
     Agreement, in the form attached as Exhibit A, to be made by the Borrower to
     the Lender pursuant to this Agreement, as the same may be amended from time
     to time.

          (s) EURODOLLAR BUSINESS DAY. Eurodollar Business Day shall mean any
     day on which commercial banks are open for international business
     (including dealings in dollar deposits) in London, England.

          (t) EVENT OF DEFAULT. Defined in Section 8.1 of this Agreement.

          (u) EXISTING CREDIT FACILITY. The term "Existing Credit Facility"
     shall mean that certain $75,000,000 credit facility provided by Lender to
     Borrower pursuant to that certain Loan and Security Agreement dated of as
     of August 15, 1995, as amended by a First Amendment to Loan and Security
     Agreement dated as of December 28, 1995, as further amended by a Second
     Amendment to Loan and Security Agreement dated as of October 31, 1996, as
     further amended by a Third Amendment to Loan and Security Agreement dated
     as of March 31, 1999 and as further amended by a Fourth Amendment to Loan
     and Security Agreement dated as of December 16, 1999.

          (v) EXTENSION COMMITMENT FEE. The additional commitment fee payable in
     accordance with Section 2.6(b) hereof.

          (w) EXTENSION TERM. The term "Extension Term" shall have the meaning
     inscribed to such term in Section 2.7(b) hereof.

          (x) FINAL MATURITY DATE. November 30, 2001, subject to extension in
     accordance with Section 2.7(b) hereof.

          (y) FINANCIAL STATEMENTS. The tax returns and balance sheets and
     statements of income and expense of the Borrower, and the related notes and
     schedules delivered by Borrower to Lender prior to the Closing Date and
     provided for in Section 4.5(c) of this Agreement; and the monthly,
     quarterly and annual financial statements and reports required to be
     provided to Lender pursuant to Section 7.1(h).

          (z) GAAP. Generally accepted accounting principles, applied on a
     consistent basis, as described in Opinions of the Accounting Principles
     Board of the American Institute of Certified Public Accountants and/or in
     statements of the Financial Accounting Standards Board which are applicable
     in the circumstances as of the date in question.

                                       4
<PAGE>   6

          (aa) HAZARDOUS MATERIALS. "Hazardous substances," "hazardous waste" or
     "hazardous constituents," "toxic substances", or "solid waste", as defined
     in the Environmental Laws, and any other contaminant or any material, waste
     or substance which is petroleum or petroleum based, asbestos,
     polychlorinated biphenyls, flammable explosives, or radioactive materials.

          (bb) INTEREST RATE. The variable rate, adjusted as of each LIBOR
     Determination Date, equal to the sum of LIBOR, determined as of each LIBOR
     Determination Date, plus three and one-quarter percent (3.25%) per annum.

          (cc) INTERVAL. With respect to each Resort the undivided fractional
     fee interval ownership interest as a tenant-in-common ((sometime referred
     to in the Timeshare Documents as a condoshare interest or condoshare week)
     in a Unit to be sold to a Purchaser by delivery of a deed for a time-share
     period per calendar year (or, in the case of a biennial use period, per
     alternate calendar year) of one week (as defined in the Declaration),
     together with all appurtenant rights and interests, including, without
     limitation, appurtenant rights in and to Common Elements, and easement,
     license, access and use rights in and to all Resort facilities and
     amenities (as described in the Declaration), all as more particularly
     described in the Declaration or other Timeshare Documents. Notwithstanding
     the foregoing, the term "Interval" shall also include, with respect to the
     Oak `N Spruce Resort only, the beneficial interest in the entity which owns
     each of the Units at the Oak `N Spruce Resort, as evidenced by the delivery
     to the Purchaser of any such beneficial interest of a certificate of
     beneficial interest for a timeshare period per calendar year (or, in the
     case of biennial use period, per alternate calendar year) of one week (as
     defined in the Oak N' Spruce Resort Declaration), together with all
     pertinent rights and interests, including, without limitation, a pertinent
     right in and to Common Elements, and easements, license, access and use
     rights in and to all Oak `N Spruce Resort facilities and amenities, all as
     more particularly described in the Declaration or other Timeshare Documents
     for the Oak `N Spruce Resort.

          (dd) INVENTORY. The term "Inventory" shall mean the Intervals from
     Eligible Resorts, fee title to which is held by the Borrower and on which
     Lender is granted a first mortgage lien to secure the Loan.

          (ee) LIEN. Any interest in property securing an obligation owed to, or
     claim by, a Person other than the owner of such property, whether such
     interest arises in equity or is based on the common law, statute, or
     contract.

          (ff) LIBOR shall mean, with respect to any LIBOR Rate Period, the rate
     per annum (rounded upwards, if necessary, to the nearest one-sixteenth
     (1/16th) of one percent (1%)) reported at 11:00 a.m. London time on the
     first day of each LIBOR Rate Period (or if such date is not a Eurodollar
     Business Day, the immediately preceding Eurodollar Business

                                       5
<PAGE>   7

     Day) (such date, the "LIBOR DETERMINATION DATE"), on Dow Jones Telerate
     Service Page 3750 (British Bankers Association Settlement Rate) as the
     non-reserve adjusted London Interbank Offered Rate for U.S. dollar deposits
     having a ninety (90) day term (or on such other page as may replace said
     Page 3750 on that service or such other service or services as may be
     nominated by the British Bankers Association for the purpose of displaying
     such rate, all as determined by Lender in its sole but good faith
     discretion). In the event that (i) more than one such LIBOR is provided,
     the average of such rates shall apply, or (ii) no such LIBOR is published,
     then LIBOR shall be determined from such comparable financial reporting
     company as Lender in its sole but good faith discretion shall determine.
     LIBOR for any LIBOR Rate Period shall be adjusted from time to time by
     increasing the rate thereof to compensate Lender for any aggregate reserve
     requirements (including, without limitation, all basic, supplemental,
     marginal and other reserve requirements and taking into account any
     transitional adjustments or other scheduled changes in reserve requirements
     during any LIBOR Rate Period) which are required to be maintained by Lender
     with respect to "Eurocurrency Liabilities" (as presently defined in
     Regulation D of the Board of Governors of the Federal Reserve System) of
     the same term under Regulation D, or any other regulations of a
     Governmental Authority having jurisdiction over Lender of similar effect.

          (gg) LIBOR RATE PERIOD shall mean each successive ninety (90) day
     period during the Term. The initial LIBOR Rate Period shall commence on the
     date of this Agreement (or if such day is not a Eurodollar Business Day,
     the immediately preceding Eurodollar Business Day) and shall terminate on a
     date which is thirty days thereafter (or if such day is not a Eurodollar
     Business Day, the immediately preceding Eurodollar Business Day). Each
     LIBOR Rate Period after the initial LIBOR Rate Period shall commence on the
     first Eurodollar Business Day immediately following the expiration of the
     immediately preceding LIBOR Rate Period and shall terminate ninety days
     thereafter (or if such day is not a Eurodollar Business Day, the
     immediately preceding Eurodollar Business Day).

          (hh) LOAN The term "Loan" shall mean the $10,000,000.00 revolving term
     inventory loan described in this Agreement, subject to the limitations set
     forth in Section 2.1 hereof.

          (ii) LOAN DOCUMENTS. Collectively, this Agreement and the following
     documents and instruments listed below as such agreements, documents,
     instruments or certificates may be amended, renewed, extended, restated or
     supplemented from time to time.

               (i) THIS AGREEMENT;

                                       6
<PAGE>   8

               (ii) THE NOTE;

               (iii) THE ENVIRONMENTAL INDEMNIFICATION AGREEMENT;

               (iv) THE MORTGAGES;

               (v) FINANCING STATEMENTS; UCC financing statements covering the
          Collateral, to be filed with the Texas Secretary of State and the
          Secretary of State and/or such other office where UCC financing
          statements are filed in each state in which the Collateral is located.

               (vi) OTHER ITEMS; Such other agreements, documents, instruments,
          certificates and materials as Lender may request to evidence the
          Obligations; to evidence and perfect the rights and Liens and security
          interests of the Lender contemplated by the Loan Documents, and to
          effectuate the transactions contemplated herein, as such agreements,
          documents, instruments or certificates may be hereafter amended,
          renewed, extended, restated or supplemented from time to time.

          (jj) LOAN YEAR. The period from the Closing Date through the last day
     of the next full twelve (12) calendar month period and each twelve (12)
     calendar month period thereafter.

          (kk) LOAN TO RETAIL VALUE RATIO. The term "Loan to Retail Value Ratio"
     shall mean the ratio of the outstanding principal balance of the Loan, from
     time to time, to the Retail Value of the Inventory. The "Loan to Retail
     Value Ratio" shall be 15%.

          (ll) MANDATORY PREPAYMENT. Any prepayment required by Section 2.4(b)
     of this Agreement.

          (mm) MORTGAGE OR MORTGAGES. A properly recorded, first priority
     mortgage, deed of trust, deed to secure debt, assignment of beneficial
     interest or other security instrument, as applicable, in the form attached
     hereto as Exhibit A (with such changes as may be necessary to comply with
     the law of the state in which the Inventory in question is located)
     executed and delivered by Borrower to Lender encumbering all of the right,
     title and interest of the Borrower in the Inventory and Common Elements,
     and related or appurtenant easement, access and use rights and benefits.

          (nn) NEGATIVE PLEDGE AGREEMENT The Negative Pledge Agreement, in the
     form attached as Exhibit A, made by the Borrower and each applicable
     Affiliate to the Lender pursuant to this Agreement, as the same may be
     amended from time to time.

                                       7
<PAGE>   9

          (oo) NOTE. The Secured Promissory Note, in the form attached as
     Exhibit A, dated the Closing Date and executed and delivered by Borrower to
     Lender evidencing the Loan made or to be made by Lender to Borrower.

          (pp) OBLIGATIONS. All amounts due or becoming due to Lender in respect
     of the Loan under any of the Loan Documents, including principal, interest,
     prepayment premiums, contributions, taxes, insurance, loan charges,
     custodial fees, attorneys' and paralegals' fees and expenses and other fees
     or expenses incurred by Lender or advanced to or on behalf of Borrower by
     Lender pursuant to any of the Loan Documents, and the prompt and complete
     payment and performance by the Borrower of all obligations, indebtedness
     and liabilities pursuant to this Agreement or any of the Loan Documents or
     otherwise

          (qq) OPERATING CONTRACT OR OPERATING CONTRACTS. As defined in Section
     6.20.

          (rr) PERSON. An individual, partnership, corporation, limited
     liability company, trust, unincorporated organization, other entity, or a
     government or agency or political subdivision thereof.

          (ss) PROPERTY OR PROPERTIES. Any interest in any kind of property or
     asset, whether real, personal or mixed, tangible or intangible.

          (tt) PRIME RATE. The highest prime rate of interest from time to time
     announced or published by Chase Manhattan Bank, N.A. ("Bank"). In the event
     that the prime rate established by Bank shall no longer be available, due
     to either the non-existence of the Bank or the Bank's failure to publish a
     prime rate, then the Prime Rate shall be the highest prime rate published
     by a comparable major money center bank selected by Lender.

          (uu) PURCHASE PRICE. The total purchase price of an Interval, as
     approved by Lender from time to time, relating to the sale by the Borrower
     to a Purchaser of an Interval comprising a part of the Inventory.

          (vv) PURCHASER. Any Person who purchases one or more Intervals.

          (ww) RELEASE PAYMENT. The term "Release Payment" shall have the
     meaning ascribed to such term in Section 2.3(b) hereof.

          (xx) INTERVAL RELEASE THRESHOLD. The term "Interval Release Threshold"
     shall mean 110% of the Required Retail Value of the Inventory. By way of
     example, if the

                                       8
<PAGE>   10

     Required Retail Value of the Inventory is $66,666,666.66, the Inventory
     Release Threshold will be $73,333,333.33.

          (yy) RETAIL VALUE. The term "Retail Value" shall mean the fair market
     value of the Inventory and each Interval constituting part of the
     Inventory, as determined by Lender in its sole discretion.

          (zz) REQUIRED RETAIL VALUE. The term "Required Retail Value" shall
     mean the aggregate Retail Value of the Inventory, such that the ratio of
     the outstanding balance of the Loan, from time to time, to the aggregate
     Retail Value of the Inventory does not exceed the Loan to Retail Value
     Ratio. By way of example, if the outstanding principal balance of the Loan
     is $10,000,000, the Required Retail Value of the Inventory will be
     $66,666,666.66.

          (aaa) RESORT OR RESORTS (ALSO "ELIGIBLE RESORT" OR "ELIGIBLE
     RESORTS"). Individually and collectively, as applicable, each or all of the
     interval ownership and time-share projects consisting of: (i) (A) Holly
     Lake Ranch, Hawkins, Texas; (B) Piney Shores Resort, Conroe, Texas; (C)
     Lake O' The Woods, Flint, Texas; (D) Hill Country Resort, Canyon Lake,
     Texas; (E) Ozark Mountain Resort, Kimberling City, Missouri; (F) Holiday
     Hills Resort, Branson, Missouri; (G) Fox River Resort, LaSalle County,
     Illinois; (H) Timber Creek Resort, Jefferson County, Missouri, (I) Oak N'
     Spruce Resort, South Lee, Massachusetts and (J) Apple Mountain Resort,
     Habersham County, Georgia (also sometime individually and collectively
     referred to herein as the "EXISTING RESORTS") and (ii) subject to Lender's
     prior written approval and satisfaction by the Borrower of the conditions
     precedent set forth in Sections 3.4 and 4.5 hereof, the Additional Eligible
     Resorts. The term "Resort" or "Resorts" includes, among other things, the
     undivided annual or (biennial) timeshare ownership interests (Intervals) in
     the respective Resorts, and the appurtenant exclusive rights to use Units
     in one or more buildings or phases and all appurtenant or related
     properties, amenities, facilities, equipment, appliances, fixtures,
     easements, licenses, rights and interests, including without limitation,
     the Common Elements, as established by and more fully defined and described
     in the respective Declarations, and the other Timeshare Documents.

          (bbb) SURVEY. A plat or survey of the Resort prepared by a licensed
     surveyor acceptable to Lender and in a form acceptable to Lender.

          (ccc) TERM. A period of two (2) calendar years from the Closing Date,
     plus the number of days from the Closing Date to the end of the month in
     which the Closing Date occurs, subject to extension as provided in Section
     2.7(b) hereof.

          (ddd) TIMESHARE ACT. Any statute, act, regulation, ordinance, rule or
     law applicable to the establishment and operation of the Resorts and the
     sales of the Intervals.

                                       9
<PAGE>   11

          (eee) TIMESHARE DOCUMENTS. Any registration statement required under
     any Timeshare Act approving the establishment and operation of the Resorts
     and the sales of Intervals.

          (fff) TIMESHARE OWNERS' ASSOCIATION. With respect to each Resort, the
     Silverleaf Club, a Texas non-profit corporation, and the applicable
     not-for-profit corporations described on Schedule 1.1(mmm).

          (ggg) UCC FINANCING STATEMENTS. The UCC-1 Financing Statements, naming
     the Borrower as debtor and the Lender as secured party, heretofore or
     hereafter filed in connection with the Loan and all amendments thereto.

          (hhh) UNIT. With respect to each Resort, one living unit in a building
     incorporated into the Resort pursuant to the Declaration, together with all
     related or appurtenant Common Elements and related or appurtenant interests
     in services, easements and other rights or benefits, as described and
     provided for in the Declaration, including but not limited to the right to
     use the Resort amenities and facilities in accordance with the Timeshare
     Documents.

                              SECTION 2 -- THE LOAN

     2.1 REVOLVING LOAN AND LENDING LIMITS. Upon the terms and subject to the
conditions set forth in this Agreement, including but not limited to Section 2.8
hereof, the Lender shall make Advances to the Borrower, and the Borrower may
borrow, repay and reborrow during the Revolving Loan Period, as such term is
hereafter defined, principal under the Loan in an amount not to exceed at any
time the lesser of: (i) the Loan to Retail Value Ratio of the Required Retail
Value of the Inventory or (ii) $10,000,000.00.

     2.2 INTEREST RATE. The aggregate principal amount of all Advances, which
are outstanding from time to time, will bear interest at a rate equal to the
Interest Rate. Each Advance shall bear interest at the Interest Rate as of
Lender's wiring of funds through Lender's receipt of repayment of the Loan (if
received by Lender later than 12 noon, Eastern Standard Time, then interest
accrual shall be through the next Business Day following such receipt).
Immediately upon the occurrence of an Event of Default and after the Final
Maturity Date (if the Loan is not paid in full on the Final Maturity Date), at
Lender's election in its sole discretion, the Loan will bear interest at the
Default Rate.

                                       10
<PAGE>   12

     2.3 PAYMENTS. The Borrower agrees punctually to pay or cause to be paid to
the Lender, all principal and interest due under the Note in respect of the Loan
made by the Lender hereunder. The Borrower shall make the following payments on
the Loan:

          (a) MONTHLY PAYMENTS. The Borrower shall pay to the Lender, on the
first day of each month during the Term, commencing on February 1, 2000,
interest on the outstanding principal balance of the Loan, from time to time, at
the Interest Rate. Lender shall apply each such payment in the following order:
(i) to the payment of all costs or expenses incurred by the Lender pursuant to
this Agreement in creating, maintaining, protecting or enforcing the Liens in
and to the Collateral and in collecting any amount due to Lender in connection
with the Loan; (ii) to any interest accrued at the Default Rate; (iii) to the
payment of accrued and unpaid interest at the Interest Rate; and (iv) to the
reduction of the principal balance of such Lender's outstanding Loans. If the
amount of the funds received by Lender with respect to any month is insufficient
to pay in all amounts due from Borrower to Lender under this Agreement, Borrower
shall pay the difference to Lender on or before the fifth (5th) day after notice
from Lender to Borrower advising Borrower of such insufficiency.

          (b) INTERVAL RELEASE PRICE PAYMENTS. Prior to the release by Lender of
any Interval from the Collateral in accordance with Section 2.10 hereof, the
Borrower shall pay to the Lender an amount equal to the greater of: (i)
$1,600.00 for each such Interval, or (ii) an amount necessary to fully repay the
Loan upon sale of 75% of the Inventory (the "RELEASE PRICE"), which payment
shall be applied by Lender in accordance with Section 2.3(a); provided, however,
that during the Initial Term, as such term is defined in Section 2.7(a), if the
Retail Value of the Inventory, as determined by the Lender, is equal to or
greater than the Interval Release Threshold, the Borrower shall not be required
to pay a Release Payment with respect to the release of any Interval for so long
as the Retail Value of the Inventory equals or exceeds the Interval Release
Threshold.

          (c) FINAL PAYMENT. The entire outstanding principal amount of the Loan
together with all other Obligations shall be paid in full by not later than the
Final Maturity Date.

     2.4 PREPAYMENTS.

          (a) VOLUNTARY PREPAYMENTS. Borrower may not voluntarily prepay the
Loan, in whole or in part, except that: (i) provided that no Event of Default
shall have occurred and be continuing and (ii) Borrower pays the Release Price
in accordance with Section 2.3(b) hereof, then at any time during the Term of
the Loan, the Loan may be prepaid in part in connection with any prepayment
which arises from release of any Interval from the Collateral, subject to
Section 2.10 hereof.

          (b) MANDATORY PREPAYMENTS. If at any time and for any reason, the
outstanding unpaid principal balance of the Loan shall exceed the amount which
satisfies

                                       11
<PAGE>   13
the Loan to Retail Value Ratio, then, within five (5) Business Days following
Borrower's receipt of telecopied notice from Lender of the occurrence of such
excess or, absent such telecopied notice, within fifteen (15) days after the end
of the calendar month in which such excess occurred, Borrower shall either: (i)
prepay the principal balance of the Loan in an amount equal to the difference
between the aggregate principal amount of the Loan and the amount necessary to
comply with the Loan to Retail Value Ratio of the Inventory or (ii) Borrower
shall grant to Lender a first mortgage Lien on additional Intervals from
Eligible Resorts so that the Retail Value of the Inventory, including such
additional Intervals, equals or exceeds the Required Retail Value of the
Inventory and the Loan to Retail Value Ratio is satisfied. In granting to Lender
a first mortgage lien on such additional Intervals, Borrower shall comply with
the document delivery and recordation requirements set forth in Section 4.2(b)
of this Agreement and Borrower shall deliver to Lender its written certification
that the Retail Value of the Inventory, including such additional Intervals, is
equal to or greater than the Required Retail Value and satisfies the Loan to
Retail Value Ratio. If Borrower elects to prepay the excess principal balance of
the Loan pursuant to this Section 2.4(b)(i) above, no prepayment premium shall
be payable in connection with such prepayment.

          (c) PREMIUMS. Notwithstanding anything herein contained to the
contrary, any prepayment under this Section 2.4 must include all accrued but
unpaid interest, and accrued but unpaid contributions, taxes, insurance, loan
charges custodial fees, attorneys' and paralegals' fees and expenses, amounts
due pursuant to Section 2.5 hereof as a result of a Funding Loss and other fees
or expenses incurred by Lender or advanced to or on behalf of Borrower by Lender
pursuant to any of the Loan Documents accrued but unpaid.

     2.5 PAYMENT OF FUNDING LOSSES AND OTHER AMOUNTS RELATING TO LIBOR CONTRACT,
ETC.

          (a) Funding Losses: Breaking of LIBOR contract, Change in Law, Etc.
     Borrower hereby agrees to pay to Lender any amount necessary to compensate
     Lender for any losses or costs (including, without limitation, the costs of
     breaking any "LIBOR" contract, if applicable, or funding losses determined
     on the basis of Lender's reinvestment rate and the interest rate thereon)
     (collectively, "FUNDING LOSSES") sustained by Lender: (i) if the Loan, or
     any portion hereof, is prepaid for any reason whatsoever on any date other
     than the Final Maturity Date (including, without limitation, from
     condemnation or insurance proceeds); (ii) upon the conversion of the
     interest rate on the Loan to an interest rate based on the Prime Rate in
     accordance with Section 2.5(b) hereof; (iii) as a consequence of the
     reduction of any amounts received or receivable from Borrower, in either
     case, due to the introduction of, or any change in, law or applicable
     regulation or treaty (including the administration or interpretation
     thereof), whether or not having the force of law, or due to the compliance
     by Lender with any directive, whether or not having the force of law, or

                                       12
<PAGE>   14

     request from any central bank or domestic or foreign governmental
     authority, agency or instrumentality having jurisdiction; (iv) as a
     consequence of the breaking of any LIBOR contract and/or (v) any other set
     of circumstances not attributable to Lender's acts. Payment of Funding
     Losses hereunder shall be in addition to any obligation to pay any other
     amounts due and owing under this Agreement or any other Loan Documents.

          (b) Conversion to Interest Rate Based on Prime Rate. If Lender
     determines (which determination shall be conclusive and binding upon
     Borrower, absent manifest error) (i) that dollar deposits in an amount
     approximately equal to the then outstanding principal balance of the Loan
     are not generally available at such time in the London Interbank Market for
     deposits in Eurodollars, (ii) that the rate at which such deposits are
     being offered will not adequately and fairly reflect the cost to Lender of
     maintaining the Interest Rate based on LIBOR, or of funding the same in
     such market for such Interest Accrual Period, due to circumstances
     affecting the London Interbank Market generally, (iii) that reasonable
     means do not exist for ascertaining LIBOR, (iv) that the Interest Rate
     based on LIBOR would be in excess of the maximum interest rate which
     Borrower may by law pay, then, in any such event, or (v) any LIBOR contract
     is broken as a result of the sale in bulk of Inventory relating to the
     Resorts by Borrower, Lender shall so notify Borrower and, as of the date of
     such notification with respect to an event described in clauses (ii), (iv)
     or (v) above, or as of the expiration of the applicable LIBOR Rate Period
     with respect to an event described in clause (i) or (iii) above, interest
     shall accrue at a rate equal to the Prime Rate plus a sufficient spread so
     that the resulting per annum interest rate is approximately equal to what
     the rate would have been based on LIBOR plus three and one-quarter percent
     (3.25%) per annum, which new rate shall apply until such time as the
     situations described above are no longer in effect, or as otherwise
     provided herein; provided, however, if the situation described in clause
     (ii) above occurs, (x) Borrower shall have the option, to be exercised by
     written notice to Lender, to pay to Lender (in the manner reasonably
     required by Lender) for such increased cost of maintaining the Interest
     Rate based on LIBOR, and (y) if the same only affects a portion of the
     Loan, then only such portion shall have interest accrue at a rate equal to
     the Prime Rate plus a sufficient spread so that the resulting per annum
     interest rate is approximately equal to what the rate would have been based
     on LIBOR plus three and one-quarter percent (3.25%) per annum, and interest
     shall continue to accrue on the remaining portion at the Interest Rate
     based on LIBOR.

          (c) Back-Up Interest Rate Based on Prime Rate. If the introduction of,
     or any change in, any law, regulation or treaty, or in the interpretation
     thereof by any governmental authority charged with the administration or
     interpretation thereof, shall make it unlawful for Lender to maintain the
     Interest Rate based on LIBOR with respect to the Loan, or any portion
     thereof, or to fund the Loan, or any portion thereof, in Eurodollars in the
     London Interbank Market, then, (i) the Loan (or such portion of the Loan)
     shall, with respect to

                                       13
<PAGE>   15

     Lender, thereafter bear interest shall accrue at a rate equal to the Prime
     Rate plus a sufficient spread so that the resulting per annum interest rate
     is approximately equal to what the rate would have been based on LIBOR plus
     three and one-quarter percent (3.25%) per annum (unless the Default Rate
     shall be applicable), and (ii) Borrower shall pay to Lender the amount of
     Funding Losses (if any) incurred in connection with such conversion. The
     accrual of interest shall accrue at a rate equal to the Prime Rate plus a
     sufficient spread so that the resulting per annum interest rate is
     approximately equal to what the rate would have been based on LIBOR plus
     three and one-quarter percent (3.25%) per annum, which new rate shall
     continue until such date, if any, as the situation described in this
     Section 2.5(c) is no longer in effect.

          (d) Capital Adequacy Events, Etc. If Lender shall have determined that
     the applicability of any law, rule, regulation or guideline adopted
     pursuant to or arising out of the July 1988 report of the Basle Committee
     on Banking Regulations and Supervisory Practices entitled "International
     Convergence of Capital Measurement and Capital Standards", or the adoption
     of any other law, rule, regulation or guideline (including, but not limited
     to, any United States law, rule, regulation or guideline) regarding capital
     adequacy, or any change becoming effective in any of the foregoing or in
     the enforcement or interpretation or administration of any of the foregoing
     by any court or any domestic or foreign governmental authority, central
     bank or comparable agency charged with the enforcement or interpretation or
     administration thereof, or compliance by Lender, with any request or
     directive regarding capital adequacy (whether or not having the force of
     law) of any such authority, central bank or comparable agency, has or would
     have the effect of reducing the rate of return on the capital of Lender or
     Lender's holding company, as the case may be, to a level below that which
     Lender or its holding company, as the case may be, could have achieved but
     for such applicability, adoption, change or compliance (taking into
     consideration Lender's or its holding company, as the case may be, policies
     with respect to capital adequacy) (the foregoing being hereinafter referred
     to as "CAPITAL ADEQUACY EVENTS"), then, upon demand by Lender, Borrower
     shall pay to Lender on behalf of any such Lender, from time to time, such
     additional amount or amounts as will compensate Lender for any such
     reduction suffered.

          (e) Payment of Amounts Due under Section 2.5. Any amount payable by
     Borrower under Section 2.5(a) or 2.5(d) hereof shall be paid to Lender
     within five (5) days of receipt by Borrower of a certificate signed by an
     officer of Lender setting forth the amount due and the basis for the
     determination of such amount, which statement shall be conclusive and
     binding upon Borrower, absent manifest error. Failure on the part of Lender
     to demand payment from Borrower for any such amount attributable to any
     particular period shall not constitute a waiver of Lender's right to demand
     payment of such amount for any subsequent or prior period. Lender shall use
     reasonable efforts to deliver to Borrower

                                       14
<PAGE>   16

     prompt notice of any event described in Sections 2.5(a) or 2.5(d) hereof
     and of the amount to be paid under this Section 2.5(e) as a result thereof;
     provided, however, any failure by Lender to so notify Borrower shall not
     affect Borrower's obligation to make the payments to be made under this
     Section 2.5(e) as a result thereof. All amounts which may become due and
     payable by Borrower in accordance with the provisions of this Section
     2.5(e) shall constitute additional interest hereunder and shall be secured
     by this Agreement and the other Loan Documents."

     2.6 COMMITMENT FEE.

          (a) Borrower acknowledges and agrees that the Commitment Fee of
     $100,000 shall be due and payable exclusively to Lender for its services
     hereunder and shall be paid to Lender upon execution of this Agreement.
     Borrower agrees that Lender has earned the entire Commitment Fee,
     notwithstanding whether a closing occurs under this Agreement or whether
     the Loan or any portion thereof is funded.

          (b) In the event that the Borrower shall exercise its option to extend
     the Term of the Loan as provided in Section 2.7 (b) below, Borrower shall
     pay to Lender, on or before October 31, 2001, an additional commitment fee
     in an amount equal to one percent (1.0%) of the outstanding balance of the
     Loan, computed as of October 31, 2001 (the "Extension Commitment Fee").

     LOAN TERM.

          (a) Initial Term: The Initial Term of the Loan shall commence on the
     date hereof and shall terminate on November 30, 2001, subject to extension
     in accordance with Section 2.7 (b) hereof.

          (b) Extension Term: Borrower shall have the right to extend the Term
     of the Loan for an additional period of twenty-four (24) months commencing
     on December 1, 2001 and terminating on November 30, 2003; provided that:

               (i) no Event of Default, or Default which would notice, the
     passage of time or both would constitute an Event of Default, shall have
     occurred;

               (ii) the Borrower notifies the Lender in writing at least six
     months prior to the expiration of the Initial Term of its election to
     exercise its option to extend the Term of the Loan;

               (iii) Borrower pays to the Lender the Extension Commitment Fee in
     accordance with Section 2.6(b).

                                       15
<PAGE>   17

     2.8 MAXIMUM OBLIGATION OF LENDER UNDER THE LOAN, THE EXISTING CREDIT
FACILITY AND THE ADDITIONAL CREDIT FACILITY. Borrower acknowledges, agrees and
confirms that notwithstanding anything to the contrary herein, in any other Loan
Document or in any document evidencing or securing the Existing Credit Facility
or the Additional Credit Facility, Lender shall not be obligated to fund the
Advance hereunder, which when taken together with the loans or advances made by
Lender to the Borrower under this Agreement, the Existing Credit Facility and
the Additional Credit Facility, would cause the aggregate amount of such loans
and advances by Lender to Borrower to exceed a maximum aggregate amount of
$50,000,000.

     2.9 SUSPENSION OF ADVANCES.

          (a) Suspension of Sales. If any stay, order, cease and desist order,
injunction, temporary restraining order or similar judicial or nonjudicial
sanction shall be issued limiting or otherwise materially adversely affecting
any Interval sales activities, other business operations in respect of the
Resorts, or the enforcement of the remedies of the Lender hereunder, then, in
such event, the Lender shall have no obligation to make any Advances hereunder:
(i) in respect of Intervals which are the subject of any stay, order, cease and
desist order, injunction, temporary restraining order or similar judicial or
nonjudicial sanction has been issued until the stay, order, cease and desist
order, injunction, temporary restraining order or similar judicial or
nonjudicial sanction has been lifted or released to the satisfaction of the
Lender and (ii) in respect of Intervals at any Resort if: (x) the stay, order,
cease and desist order, injunction, temporary restraining order or similar
judicial or nonjudicial sanction in question has not been lifted or released to
the satisfaction of the Lender within sixty (60) days of its issuance and (y)
there is a reduction in the total number of sales of Intervals by the Borrower
in any Loan Year of more than twenty percent (20%) from the total number of
sales of Intervals in the immediately preceding Loan Year.

          (b) Change in Control. If there shall occur a change, singly or in the
aggregate, of more than fifty percent (50%) of the executive management of the
Borrower as described in Schedule E hereto, then, in such event, the Lender
shall have no obligation to make any Advances hereunder, unless within thirty
(30) days prior thereto Borrower provides Lender with written information
setting forth the replacement executive management personnel of Borrower
together with a description of those Persons' experience, ability and
reputation, and Lender, acting in good faith, determines that the replacement
management personnel's experience, ability and reputation is equal to or greater
than that of the Borrower as set forth on Schedule E.

     2.10 RELEASE OF INTERVALS FROM INVENTORY. Upon written request of the
Borrower, and provided that no Event of Default shall have occurred and be
continuing hereunder, Lender shall release from the Collateral, one or more
Intervals subject to the following conditions: (i) payment by Borrower to Lender
at the time of such release of the Release Price for each such Interval, (ii)
the

                                       16
<PAGE>   18

remaining Collateral satisfies the Required Retail Value and (iii) if the
outstanding principal balance of the Loan shall, as a result of any such
release, be less than $3,000,000, then Borrower shall also pay to Lender, with
respect to the six (6) month period commencing on the date hereof and ending on
June 1, 2000, and with respect to each six (6) month period thereafter during
the Revolving Loan Period, on the fifth day of every such six (6) month period,
in arrears, a fee equal to the product of: (a) the excess, if any, of (i)
$3,000,000.00 over (ii) the average daily outstanding principal balance of the
Loan for such six (6) month period; times (b) 2% per annum.

     2.11 LIMITATIONS ON ADVANCES WITH RESPECT TO OAK N' SPRUCE RESORT.
Notwithstanding anything herein to the contrary, the Lender shall be under no
obligation to make Advances in respect of Intervals from Oak N' Spruce Resort if
any such Advance, together with any prior Advances made under this Loan
Agreement, the Additional Credit Facility and/or the Existing Credit Facility,
would exceed, in the aggregate, $32,000,000.00.

                SECTION 3 -- COLLATERAL GRANT OF SECURITY INTEREST

     3.1 GRANT OF SECURITY INTEREST. To secure the payment and performance of
the Obligations, for value received, Borrower unconditionally and irrevocably
assigns, mortgages, pledges and grants to Lender a continuing first priority
security interest in and to the Collateral. To further secure the Obligations
hereunder, at the time of each Advance, Borrower shall execute and deliver to
the Lender, such deeds of trust, mortgages, deeds to secure debt or assignments
of beneficial interest, as the case may be, in the applicable form attached here
as Exhibit A, as Lender deems necessary in its sole discretion, in order to
grant to the Lender a first priority mortgage lien on the Inventory.

     3.2 FINANCING STATEMENTS. Borrower agrees, at its own expense, to execute
the financing statements provided for by the Code together with any and all
other instruments or documents and take such other action as may be required to
perfect and to continue the perfection of Lender's security interests in the
Collateral and, unless prohibited by law, Borrower hereby authorizes Lender to
execute and file any such financing statements on the Borrower's behalf.

     3.3 INSURANCE. Insurance coverage with respect to the Resort is provided by
the Timeshare Owners' Association. Borrower shall furnish Lender, upon request,
with satisfactory evidence that the Units, Buildings and Resorts are adequately
insured.

     3.4 SUBSTITUTION OF INVENTORY. Lender agrees that Borrower may, from time
to time during the Term hereof, replace any Interval or Intervals by granting to
Lender a first mortgage Lien on a new Interval or Intervals owned by the
Borrower at an Eligible Resort. In granting to Lender a first mortgage Lien on
any such new Interval or Intervals, Borrower shall comply with the document
delivery and recordation requirements set forth in Section 4.2(b) of this
Agreement

                                       17
<PAGE>   19

and Borrower shall deliver to Lender its written certification that the Retail
Value of the Inventory after any such substitution, is equal to or greater than
the Required Retail Value and satisfies the Loan to Value Ratio. In connection
with any such replacement of Inventory under this Section 3.4 or Section 2.4(b)
hereof, Borrower may propose to Lender that one or more additional time-share
plans and projects owned and operated by Borrower be included among the Eligible
Resorts . Any such proposal will be in writing, and will be accompanied or
supported by the due diligence and supporting Borrower, Affiliate, project,
financial and related information identified in Section 4.5 hereto, and such
other information as Lender may require. Borrower will reasonably cooperate with
Lender's underwriting and due diligence, and Borrower will be responsible for
payment upon billing for Lender's out-of-pocket expenses in connection
therewith. Subject to Lender's satisfactory underwriting and due diligence
review, including satisfaction of the conditions in Sections 4 and 5 hereof as
they relate to such additional time-share resorts, Lender may, but shall not be
required to, approve one or more such additional time-share resorts, including
future phases or condominiums in an Existing Eligible Resort, as an Eligible
Resort. Subject in each instance to Lender's acceptable underwriting and due
diligence review, and Lender's prior written approval, any project as may be
approved by Lender after the Closing Date, if any, is hereinafter referred to
singly as an "ADDITIONAL ELIGIBLE RESORT" and collectively as the "ADDITIONAL
ELIGIBLE RESORTS."

                SECTION 4 -- CONDITIONS PRECEDENT TO THE CLOSING

     4.1 CONDITIONS PRECEDENT. The obligation of Lender to enter into this
Agreement and to fund the initial Advance shall be subject to the satisfaction
of each of the following conditions precedent, in addition to all of the
conditions precedent set forth elsewhere in the Loan Documents:

          (a) REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS. The
     representations and warranties contained in the Loan Documents are and
     shall be true and correct in all respects, and all covenants and agreements
     have been complied with and correct in all respects, and all covenants and
     agreements to have been complied with and performed by Borrower shall have
     been fully complied with and performed to the satisfaction of Lender.

          (b) NO PROHIBITED ACTS. Borrower shall not have taken any action or
     permitted any condition to exist which would have been prohibited by any
     provision of this Agreement or the Loan Documents.

          (c) NO CHANGES. That all information and documents heretofore
     delivered by Borrower to Lender with respect to the Existing Resorts,
     including information and documents delivered in connection with the
     Existing Credit Facility and/or the Additional Resort Facility, remain true
     and correct in all respects.

                                       18
<PAGE>   20

          (d) APPROVAL OF DOCUMENTS PRIOR TO CLOSING DATE. Borrower has
     delivered to Lender (with copies to Lender's counsel), at least fifteen
     (15) Business Days prior to the Closing Date, and Lender has reviewed and
     approved, at least five (5) Business Days prior to the Closing Date, the
     form and content of all of the items specified in Subsection 4.1(d)(i)
     through (vi) below (the "Submissions"). Lender shall have the right to
     review and approve any changes to the form of any of the Submissions. If
     Lender disapproves of any changes to any of the Submissions, Lender shall
     have the right to require Borrower either to cure or correct the defect
     objected to by Lender or to elect not to fund the Loan or any Advance.
     Under no circumstances shall Lender's failure to approve or disapprove a
     change to any of the Submissions be deemed to be an approval of such
     Submissions. All of the Submissions were and shall be prepared at
     Borrower's sole cost and expense, unless expressly stated to be an
     obligation and expense of Lender. Lender shall have the right of prior
     approval of any Person responsible for preparing a Submission ("Preparer")
     and may disapprove any Preparer in its sole discretion, for any reason,
     including without limitation, that Lender believes that the experience,
     skill, reputation or other aspect of the Preparer is unsatisfactory in any
     respect. All Submissions required pursuant to this Agreement shall be
     addressed to Lender and include the following language: "THE UNDERSIGNED
     ACKNOWLEDGES THAT TEXTRON FINANCIAL CORPORATION IS RELYING ON THE WITHIN
     INFORMATION IN CONNECTION WITH ITS DETERMINATION TO MAKE A LOAN TO
     SILVERLEAF RESORTS, INC. IN CONNECTION WITH THE SUBJECT COLLATERAL."

               (i) A certificate in the form attached as Exhibit A, to be dated
          as of the Closing Date and signed by the president, vice president, or
          secretary of the Borrower, certifying that the conditions specified in
          Sections 4.1(a), (b) and (c) above are true;

               (ii) Copies of any amendments to the articles of incorporation of
          Borrower not previously delivered to the Lender, certified to be true
          and complete by Borrower and the Secretary of State of the State of
          Texas and a current certificate of good standing for Borrower, and
          copies of any amendments to the by-laws of Borrower not previously
          delivered to the Lender, certified to be true, correct and complete by
          the secretary or assistant secretary of Borrower;

               (iii) a certificate of the Secretary of the Borrower certifying
          the adoption by the Board of Directors of the Borrower of a resolution
          authorizing Borrower to enter into and execute this Agreement, the
          Note, and the other Loan Documents, to borrow the Loan from Lender,
          and to grant to Lender a first priority security interest in and to
          the Collateral;

                                       19
<PAGE>   21

               (iv) a certificate of the secretary or assistant secretary of
          Borrower certifying the incumbency, and verifying the authenticity of
          the signatures, of the specified officers of Borrower authorized to
          sign the Agreement, the Note and the other Loan Document; and

               (v) Copies or other evidence of all loans to Borrower from any
          officers, shareholders, or Affiliates of Borrower not previously
          delivered to the Lender.

               (vi) Commitment to issue Mortgagee Title Policies (as defined
          below) from the Title Company.

          (e) EXECUTION AND DELIVERY OF LOAN DOCUMENTS. Borrower shall have
     delivered to Lender, on or before the Closing Date, the following Loan
     Documents, each of which shall be in the form of the respective Loan
     Documents attached hereto as Exhibit "A", and each of which when required,
     shall be in recordable form:

               (i) CLOSING OPINIONS FOR BORROWER.

               (ii) NOTE.

               (iii) ENVIRONMENTAL INDEMNITY. An Environmental Indemnity
          Agreement, executed by Borrower in favor of Lender.

               (iv) OTHER ITEMS. Such other agreements, documents, instruments,
          certificates and materials as Lender may request to evidence the
          Obligations; to evidence and perfect the rights and Liens and security
          interests of Lender contemplated by the Loan Documents, and to
          effectuate the transactions contemplated herein.

          (f) PHYSICAL INSPECTION. Lender shall be satisfied with its physical
     inspection of the Resorts.

          (g) UCC SEARCH. Lender shall have obtained, at Borrower's cost, such
     searches of the applicable public records as it deems necessary under
     Texas, and other applicable law to verify that it has a first and prior
     perfected Lien and security interest covering all of the Collateral. Lender
     shall not be obligated to fund any Loan if Lender determines that it does
     not have a first and prior perfected lien and security interest covering
     any portion of the Collateral.

                                       20
<PAGE>   22

          (h) LITIGATION SEARCH. Lender shall have obtained, at Borrower's cost,
     an independent search to verify that there are no bankruptcy, foreclosure
     actions or other material litigation or judgments pending or outstanding
     against the Resorts, any portion of the Collateral, Borrower, or any
     Affiliates of Borrower (each a "Material Party"). The term "other material
     litigation" as used herein shall not include matters in which (i) a
     Material Party is plaintiff and no counterclaim is pending or (ii) which
     Lender determines, in its sole discretion exercised in good faith, are
     immaterial due to settlement, insurance coverage, frivolity, or amount or
     nature of claim. Lender shall not be obligated to fund any Advance if it
     determines that any such litigation is pending.

     4.2 CLOSING DATE ADVANCE. In the event that Borrower desires Lender to make
an Advance on the Closing Date, then, in addition to all of the conditions
precedent set forth in this Section 4, Borrower shall have complied with all of
the requirements of Section 5 below at least five (5) Business Days prior to the
Closing Date.

     4.3 EXPENSES. Borrower shall have paid all fees and expenses required to be
paid pursuant to this Agreement. Lender shall have no obligation to fund the
Loan or make the initial Advance or any subsequent Advance unless (a) the amount
of the Loan together with any moneys paid by Borrower is sufficient to satisfy
all fees and expenses required to be paid pursuant to this Agreement, and (b)
the proceeds of the Advance will not be used for any of the uses set forth in
Section 6.11.

     4.4 PROCEEDINGS SATISFACTORY. Borrower shall execute all of the Loan
Documents approved by Lender on the Closing Date, and all actions taken in
connection with the execution or delivery of the Loan Documents, and all
documents and papers relating thereto, shall be satisfactory to Lender and its
counsel. Lender and its counsel shall have received copies of such documents and
papers as Lender or such counsel may reasonably request in connection therewith,
all in form and substance satisfactory to Lender and its counsel.

     4.5 CONDITIONS PRECEDENT TO FUNDING OF ADVANCES WITH RESPECT TO ADDITIONAL
ELIGIBLE RESORTS. As provided in the Section 3.4 hereof, Borrower may propose to
Lender that Lender approve one or more additional timeshare plans for inclusion
hereunder as an Additional Eligible Resort in respect of which Intervals may be
accepted as part of the Inventory and Advances may be made. The obligation of
Lender to fund any Advance with respect to any Interval from an Additional
Resort shall be subject to the satisfaction of each of the following conditions
precedent, in addition to all of the conditions precedent set forth elsewhere in
the Loan Documents:

     (a) Representations, Warranties, Covenants and Agreements. The
representations and warranties contained in the Loan Documents are and shall be
true and correct in all respects, and all

                                       21
<PAGE>   23

covenants and agreements have been complied with and correct in all respects,
and all covenants and agreements to have been complied with and performed by
Borrower shall have been fully complied with and performed to the satisfaction
of Lender.

     (b) No Prohibited Acts. Borrower shall not have taken any action or
permitted any condition to exist which would have been prohibited by any
provision of the Loan Documents.

     (c) Approval of Documents Prior to Advance. Borrower has delivered or
caused to be delivered to Lender (with copies to Lender's counsel, at least
fifteen (15) Business Days prior to the date of each such Advance), and Lender
has reviewed and approved, at least five (5) Business Days prior to such date,
the form and content of all of the items specified in each of the Submissions
required pursuant to this Section 4.5. Lender shall have the right to review and
approve any changes to the form of any of the Submissions. If Lender disapproves
of any changes to any of the Submissions, Lender shall have the right to require
Borrower either to cure or correct the defect objected to by Lender or to elect
not to fund the Loan or any Advance with respect to any such Interval. Under no
circumstances shall Lender's failure to approve or disapprove a change to any of
the Submissions be deemed to be an approval of such Submissions. All of the
Submissions were and shall be prepared at Borrower's sole cost and expense,
unless expressly stated to be an obligation and expense of Lender. Lender shall
have the right of prior approval of any Preparer and may disapprove any Preparer
in its sole discretion, for any reason, including without limitation, that
Lender believes that the experience, skill, reputation or other aspect of the
Preparer is unsatisfactory in any respect. All Submissions required pursuant to
this Agreement shall be addressed to Lender and include the following language:
"THE UNDERSIGNED ACKNOWLEDGES THAT TEXTRON FINANCIAL CORPORATION IS RELYING ON
THE WITHIN INFORMATION IN CONNECTION WITH ITS DETERMINATION TO MAKE A LOAN TO
SILVERLEAF RESORTS, INC. IN CONNECTION WITH THE SUBJECT COLLATERAL."

          (i)   a certificate in the form attached as Exhibit A, to be dated as
                of the date of each such Advance and signed by the president,
                vice president, or secretary of the Borrower, certifying that
                the conditions specified in Sections 4.5(a) and (b) above are
                true;

          (ii)  copies of the articles of incorporation of Borrower, together
                with any amendments thereto certified to be true and complete by
                Borrower and the Secretary of State of the State of Texas, a
                current certificate of good standing for Borrower issued by the
                Secretary of State of the State of Texas, a current certificate
                of authority to conduct business issued by the secretary of
                state in each state in which the Borrower conducts business, and
                copies of the by-laws of Borrower certified to be true, correct
                and complete by the secretary or assistant secretary of
                Borrower;

          (iii) except for the Resorts listed on Schedule 4.5(c)(iii) (the
                "CROWN RESORTS"), a Survey for each Additional Eligible Resort
                for which a mortgage lien is being granted to the Lender on
                Intervals in connection with the Advance in question; and

                                       22
<PAGE>   24

             with respect to each Crown Resort, a legible, full size copy of the
             recorded plat for each such Resort;

       (iv)  a certificate of the secretary or assistant secretary of Borrower
             certifying the adoption by the board of directors thereof,
             respectively, of a resolution authorizing the addition of the
             Resort in question as an Additional Eligible Resort and to
             authorize Borrower to enter into, execute and deliver any Documents
             in connection therewith;

        (v)  a certificate of the secretary or assistant secretary of Borrower
             certifying the incumbency, and verifying the authenticity of the
             signatures, of the specified officers of Borrower authorized to
             sign all documents required in connection with such Additional
             Eligible Resort as required pursuant to this Section 4.5;

       (vi)  an inspection report or reports covering each Additional Eligible
             Resort for which a mortgage lien is being granted to the Lender on
             Intervals in connection with the Advance in question, including
             without limitation all real property and personal property subject
             to the Declaration and all adjacent property, confirming:

                 (1) the absence of Hazardous Materials on the personal property
                     and real property comprising each such Additional Eligible
                     Resort;

                 (2) that the inspection firm has obtained, reviewed and
                     included within its report a CERCLIS printout from the
                     Environmental Protection Agency (the "EPA"), statements
                     from the EPA and other applicable state and local
                     authorities and a Phase I Environmental Audit, all of which
                     information shall confirm that there are no known or
                     suspected Hazardous Materials located at, used or stored
                     on, or transported to or from each such Additional Eligible
                     Resort or in such proximity thereto as to create a material
                     risk of contamination of each such Additional Eligible
                     Resort;

      (vii)  evidence that Borrower is maintaining all policies of insurance
             required by and in accordance with Section 7.1(d) hereof, including
             copies of the most current paid insurance premium invoices;

     (viii)  evidence that Borrower and the Timeshare Documents for each
             Additional Eligible Resort for which a mortgage lien is being
             granted to the Lender on Intervals in connection with the Advance
             in question are in compliance with all applicable laws in
             connection with its sales of Intervals, including without
             limitation, the Timeshare Acts;

                                       23
<PAGE>   25
     (ix)   a current preliminary title report or certificate of title for each
            Additional Eligible Resort for which a mortgage lien is being
            granted to the Lender on Intervals in connection with the Advance in
            question, with copies of all title exceptions;

     (x)    copies of all applicable governmental permits, approvals, consents,
            licenses, and certificates for the establishment of each Additional
            Eligible Resort for which a mortgage lien is being granted to the
            Lender on Intervals in connection with the Advance in question as
            timeshare projects in accordance with the applicable Timeshare Act,
            and for the occupancy and intended use and operation of each such
            Additional Eligible Resort, including the Units, including a letter
            certification from Borrower regarding zoning classification and
            compliance, letters or other satisfactory evidence from utility
            companies, governmental entities or other persons confirming that
            water, sewer (sanitary and storm), electricity, solid waste
            disposal, telephone, police, fire and rescue services are being
            provided to each Resort, and any business licenses necessary for
            operation of each such Additional Eligible Resort;

     (xi)   certified true, correct and complete copies of all of the Timeshare
            Documents for each Additional Eligible Resort for which a mortgage
            lien is being granted to Lender on Intervals in connection with the
            Advance in question;

     (xii)  evidence satisfactory to Lender that all taxes and assessments owed
            by or for which Borrower is responsible for collection have been
            paid, including but not limited to sales taxes, room occupancy
            taxes, payroll taxes, personal property taxes, excise taxes,
            intangibles taxes, real property taxes, and income taxes, and any
            assessments related to each Additional Eligible Resort for which a
            mortgage lien is being granted to Lender on Intervals in connection
            with the Advance in question and copies of the most current paid tax
            bills for each such Additional Eligible Resort evidencing that each
            such Additional Eligible Resort have been segregated from all other
            property on the applicable municipal taxrolls;

     (xiii) written confirmation from an architect covering each Additional
            Eligible Resort, other than a Crown Resort, for which a mortgage
            lien is being granted to Lender on Intervals in connection with the
            Advance in question as to the physical condition of the improvements
            at each such Additional Eligible Resort, including that soil
            conditions are sufficient to support all existing and any
            contemplated improvements to the real property; which written
            confirmation shall be in form and substance reasonably acceptable to
            the Lender. Each architect rendering such written confirmation shall
            be licensed as an architect in the state of Texas;

     (xiv)  such credit references on Borrower as Lender deems necessary in its
            sole discretion;

                                       24
<PAGE>   26
     (xv)    copies or other evidence of all loans to Borrower from any
             officers, shareholders, or Affiliates of Borrower, if any.

     (xvi)   a commitment to issue Mortgagee Title Policies from the Title
             Company for each Interval constituting part of the Inventory.
             Notwithstanding anything heretofore to the contrary, Lender agrees
             that Borrower shall not be required to provide such a commitment or
             a Mortgagee Title Insurance Policy with respect to any Crown Resort
             (other than the Quail Hollow Resort), or, until such time as deeded
             Intervals are permitted under local law governing the Oak N' Spruce
             Resort, the Oak `N Spruce Resort in order to qualify any such
             Resort as an Additional Eligible Resort, provided, however, that
             under no circumstance shall the portion of Loan secured by
             Intervals from the Crown Resorts (other than Quail Hollow Resort)
             or Oak N' Spruce Resort exceed $1,000,000.00 in the aggregate.
             Notwithstanding anything heretofore to the contrary, if any claim,
             lien, encumbrance, charge or other matter arises with respect to
             any Interval or Intervals which constitutes part of the Collateral
             pursuant to this Agreement and for which Borrower has not provided
             a Mortgagee Title Policy, then, in such event:

             (a) The Interval in question shall cease to constitute Inventory
                 and the Borrower immediately shall either replace the Mortgage
                 with respect to the Interval in question with a Mortgage on an
                 Interval acceptable to Lender in its sole discretion or make a
                 Mandatory Prepayment as provided in Section 2.4(b) hereof; and

             (b) The Resort at which the Interval in question is located shall
                 cease to be an Additional Eligible Resort, unless and until the
                 Borrower shall cure any such claim, lien, encumbrance, charge
                 or other matter to the satisfaction of the Lender. Furthermore,
                 any and all further requests for Advances in respect of
                 Intervals from the Resort in question must thereafter be
                 accompanied by satisfactory Mortgagee Title Policies.

     (xvii)  the Financial Statements.

     (xviii) to the extent not previously delivered pursuant to the Additional
             Credit Facility, the Existing Credit Facility or hereunder,
             Borrower will execute, or cause to be executed with respect to each
             Additional Eligible Resort, a Negative Pledge, Borrower's Affidavit
             with Respect to the Additional Eligible Resorts and an
             Environmental Indemnification Agreement, each in the form attached
             hereto as Exhibit A;

                                       25
<PAGE>   27
     (xix) with respect to any improvements, including any Units, constructed at
           a Resort within the twenty-four month period prior to the approval of
           any Additional Eligible Resort, Borrower shall also deliver to
           Lender, for its approval, such documents and instruments as Lender
           may reasonably request in connection with such newly constructed
           improvements, including, without limitation, copies of building
           permits, plans and specifications construction and architectural
           contracts, title insurance insuring over, among other things,
           mechanics liens, certificates of occupancy and satisfactory evidence
           of the completion of such improvements;

     (xx)  such other documents, instruments, agreements, tests, reports and
           inspections as the Lender may require with respect to the Borrower or
           any applicable Affiliate, the Loan or any Resort, including any
           Additional Eligible Resort.

     (xxi) Upon request of the Lender, Borrower shall deliver to the Lender
           evidence, satisfactory to the Lender, that there is no material
           litigation, written complaint, suit, action, written claim or written
           charge pending against the Borrower or any Affiliate with any court
           or with any governmental authority with respect to the Resort, the
           Timeshare Documents, any Interval, or any marketing, offer or sale of
           any Interval.

     (d)   Physical Inspection. Lender shall be satisfied with its physical
inspection of the Additional Eligible Resorts.

     (e)   UCC Search. Lender shall have obtained, at Borrower's cost, such
searches of the applicable public records as it deems necessary under all
applicable law to verify that it has a first and prior perfected Lien and
security interest covering all of the Collateral. Lender shall not be obligated
to fund any Advance if Lender determines that it does not have a first and prior
perfected lien and security interest covering any portion of the Collateral.

     (f)   Litigation Search. Lender shall have obtained, at Borrower's cost, an
independent search to verify that there are no bankruptcy, foreclosure actions
or other material litigation or judgments pending or outstanding against the
Additional Eligible Resorts, any portion of the Collateral, Borrower, or any
Affiliate, (each a "MATERIAL PARTY"). The term "other material litigation" as
used herein shall not include matters in which (i) a Material Party is plaintiff
and no counterclaim is pending or (ii) which Lender determines, in its sole
discretion exercised in good faith, are immaterial due to settlement, insurance
coverage, frivolity, or amount or nature of claim. Lender shall not be obligated
to fund any Advance if it determines that any such litigation is pending.

     (g)   Opinions of Borrower's Counsel. Borrower shall deliver to Lender, for
the benefit of Lender, at Borrower's sole cost and expense, such opinions of
counsel, including counsel admitted in each state in which each Additional
Eligible Resort is located, as to such matters with

                                       26
<PAGE>   28

respect to the Borrower and each Additional Eligible Resort as Lender may
request, and in form and substance acceptable to Lender in its sole discretion.

     (h) Funding Procedure. Borrower shall have complied to Lender's
satisfaction with each of the conditions precedent to funding of any Advance set
forth in Section 5 hereof.

     (i) Management of Resort. Borrower shall provide evidence satisfactory to
Lender that Borrower, or an Affiliate, is the manager or operator of each
Resort, pursuant to a written management or operating agreement, in form and
substance satisfactory to Lender, which with respect to all Resorts (other than
the Crown Resorts) shall have a term which shall expire no earlier April 1,
2009. With respect to each Crown Resort only, each such Resort may qualify as an
Additional Eligible Resort (subject to satisfaction by Borrower of the
conditions set forth in this Section 4.5), so long the Borrower, or an
Affiliate, is the manager or operator of each such Resort, pursuant to a written
management or operating agreement, in form and substance satisfactory to Lender.
Borrower agrees to provide an estoppel letter, in form and substance acceptable
to Lender, from the applicable Timeshare Owner's Association.

     (j) Other Items. Such other agreements, documents, instruments,
certificates and materials as Lender may request to determine the acceptability
of any such Additional Eligible Resort, to evidence the Obligations; to evidence
and perfect the rights and Liens and security interests of Lender contemplated
by the Loan Documents, and to effectuate the transactions contemplated herein,
including, without limitation, true copies of all Resort Documents for each such
Additional Eligible Resort, all Timeshare Documents and operating and management
contracts and agreements, evidence of with the applicable Timeshare Act and
other applicable laws, evidence of all required governmental licenses and
permits; title searches; title commitments or policies, including. Complete and
legible copies of each title exception, engineering, environmental and soil
reports, evidence of compliance with all applicable zoning and building codes;
each of which shall be satisfactory to Lender in its sole and absolute
discretion.

                         SECTION 5 -- FUNDING PROCEDURE

     The obligation of Lender to make any Advance, shall be subject to the
satisfaction of all of the following conditions precedent:

          (a) REQUESTS FOR ADVANCES. Each request for an Advance shall:

               (i) be in writing is form attached hereto as Exhibit B and shall
          certify the amount of the then-current Loan to Retail Value Ratio,
          specify the principal amount of the Advance requested and designate
          the account to which the proceeds of such Advance are to be
          transferred;

                                       27
<PAGE>   29
               (ii) state that the representations and warranties of the
          Borrower contained in the Agreement and any closing or funding related
          certifications are true and correct as of the date of the request and,
          after giving effect to the making of such requested Advance, will be
          true and correct as of the date on which the requested Advance is to
          be made;

               (iii) state that no Default or Event of Default exists as of the
          date of the request and, after giving effect to the making of the
          requested Advance, no Default or Event of Default would exist as of
          the date on which the requested Advance is to be made;

               (iv) be delivered to the office of Lender at least ten (10)
          Business Days prior to the date of the requested Advance; and

               (v) be signed by a principal financial officer of the Borrower.

          (b) LOAN DOCUMENTS/COLLATERAL. Not less than ten (10) Business Days
     prior to the date of any Advance, the Borrower shall have:

               (i) delivered to Lender a list of all Intervals which are to be
          the subject of such requested Advance, together with such additional
          information as Lender may require;

               (ii) delivered to Lender (or, if Lender shall so instruct, a
          designee appointed by Lender in writing), to the extent available, (a)
          the original or certified copies of any deed or beneficial interest
          certificate, or other documents evidencing conveyance of the Interval
          in question to the Borrower, (b) a copy of any title policy received
          by the Borrower in connection with its acquisition of the Interval in
          question, and (c) original or true copies of any purchase contract
          (including addenda) or other agreements entered into by the Borrower
          with any person with respect to the sale by the Borrower to any
          Purchaser of the Interval in question;

               (iii) delivered to Lender a duly executed Mortgage or Mortgages
          granting to Lender a first mortgage lien on the Inventory; and

               (iv) original UCC financing statements covering the Collateral,
          filed with the Secretary of State of Texas and the Secretary of State
          of each state in which the Collateral is located.

                                       28
<PAGE>   30
               (v) subject to Section 4.5(c) (xvi) hereof, delivered to Lender,
          with respect to each Interval constituting a part of the Inventory, a
          commitment for a mortgagee's title insurance policy showing that the
          Mortgage in respect of such Interval insuring in favor of Lender the
          first priority Lien of such Mortgage in the amount of the Advance to
          be made in respect of such Interval, with a satisfactory title
          insurance policy to be issued on the date of the requested Advance.

          The Mortgages to Lender shall each have been duly recorded in the
     applicable land records which are described in Schedule A hereof. The
     mortgagee's title insurance policies shall be in form and substance
     satisfactory to Lender and shall be issued by a title insurance company
     satisfactory to Lender (the "Title Company"), and name Lender as the
     insured party therein. The funding of the Advance, delivery of the
     Collateral and issuance of the title insurance policy, and recording of the
     mortgages or any releases may, in Lender's discretion, be effected by way
     of an escrow arrangement with the Title Company or other fiduciary, the
     form and substance of which shall be satisfactory to Lender.

          (c) OTHER CONDITIONS. In addition to the other conditions set forth in
     this Agreement, the making of the initial or any subsequent Advance shall
     be subject to the satisfaction of the following conditions:

               (i) no Default or Event of Default shall exist immediately prior
          to the making of such requested Advance or, after giving effect
          thereto, immediately after the making of such requested Advance;

               (ii) each agreement required to have been executed and delivered
          in connection with any prior Advance shall be consistent with the
          terms of this Agreement and shall be in full force and effect;

               (iii) the date on which such requested Advance is to be made
          shall be a Business Day;

               (iv) Borrower shall have delivered to Lender a certification
          showing the Retail Value of each Interval and Lender shall be
          satisfied with the Retail Value of each Interval in its sole
          discretion, the dollar amount of the requested Advance based on the
          Retail Value of the Intervals on which the Lender is being granted a
          Mortgage;

               (v) Not more than one Advance shall have previously been made in
          the same calendar month in which such requested Advance is to be made,
          unless Lender, in its sole discretion, agrees to make an additional
          Advance during such calendar month;

                                       29
<PAGE>   31

               (vi) Such requested Advance shall be in a principal amount of not
          less than $50,000.00, unless Lender, in its sole discretion, agrees to
          make an Advance in an amount less than $50,000.00;

               (vii) Lender shall have determined that the requested Advance
          does not exceed the total amount of the Loan to Retail Value Ratio,
          based on the Retail Value of the Inventory on which Lender has been
          granted a first mortgage lien;

               (viii) If Lender shall so require, Lender shall have received an
          executed Closing Protection Letter issued by the Title Company, which
          shall be reasonably acceptable to Lender.

          (d) EXPENSES. The Borrower shall have paid all fees and expenses
     required to be paid by pursuant to this Agreement in connection with such
     requested Advance or any conditions related thereto.

          (e) PROCEEDINGS SATISFACTORY. All actions taken in connection with
     such requested Advance and all documents and papers relating thereto shall
     be satisfactory to Lender and its counsel. Lender and its counsel shall
     have received copies of such documents and papers as the Lender or such
     counsel may reasonably request in connection with such requested Advance,
     all in form and substance reasonably satisfactory to the Lender and its
     counsel.

               SECTION 6 -- GENERAL REPRESENTATIONS AND WARRANTIES

     Borrower hereby represents and warrants to Lender as follows:

     6.1 ORGANIZATION, STANDING, QUALIFICATION. Borrower (a) is a duly organized
and validly existing Texas corporation duly organized, validly existing and in
good standing under the laws of the State of Texas, and (b) as all requisite
power, corporate or otherwise, to conduct its business and to execute and
deliver, and to perform its obligations under, the Loan Documents.

     6.2 AUTHORIZATION, ENFORCEABILITY, ETC.

          (a) The execution, delivery and performance by Borrower of the Loan
     Documents has been duly authorized by all necessary corporate action by
     Borrower and does not and will not (i) violate any provision of the
     certificate or articles of incorporation of Borrower, bylaws of Borrower,
     or any agreement, law, rule, regulation, order, writ, judgment, injunction,
     decree, determination or award presently in effect to which Borrower is a
     party or is subject; (ii) result in, or require the creation or imposition
     of, any Lien upon

                                       30
<PAGE>   32

     or with respect to any asset of Borrower other than Liens in favor of
     Lender; or (iii) result in a breach of, or constitute a default by Borrower
     under, any indenture, loan or credit agreement or any other agreement,
     document, instrument or certificate to which Borrower is a party or by
     which it or any of its assets are bound or affected.

          (b) No approval, authorization, order, license, permit, franchise or
     consent of, or registration, declaration, qualification or filing with, any
     governmental authority or other Person, including without limitation, the
     Division or the Timeshare Owners' Association is required in connection
     with the execution, delivery and performance by Borrower of any of the Loan
     Documents.

          (c) The Loan Documents constitute legal, valid and binding obligations
     of Borrower, enforceable against Borrower in accordance with their
     respective terms.

          (d) Borrower has good and marketable title to the Collateral, free and
     clear of any lien, security interest, charge or encumbrance except for the
     security interests created by this Agreement or any Loan Document or
     otherwise created in favor of Lender or those specifically consented to in
     writing by the Lender. No financing statement or other instrument similar
     in effect covering all or any part of the Collateral is on file in any
     recording office, except such as may have been filed in favor of Lender
     hereunder.

          (e) The execution and delivery of the Loan Documents, the filing of
     the UCC-1's with the office of the secretary of state of the state in which
     the applicable Resort is located and the Mortgages in the official records
     of the county in which the applicable Resort is located, create in favor of
     Lender a valid and perfected continuing first priority security interest in
     the Collateral. The Collateral shall secure the full payment and
     performance of the Obligations.

          (f) The Mortgages constitute and will constitute valid and enforceable
     first and prior liens and security interests on the Inventory.

          (g) The Loan documents are in full force and effect, are and will be
     valid and binding obligations of the respective makers in favor of Lender,
     and the Borrower further warrants and guarantees the value, quantity, sound
     condition, grade and quality of the Inventory and rights, properties,
     easements and interests appurtenant or related thereto.

          (h) Lender shall not be required to take, and the Borrower has taken
     any and all required steps to protect Lender's security interest in the
     Collateral (other than maintaining possession of the portion of the
     Collateral constituting instruments); and Lender is not or shall not be
     required to collect or realize upon the Collateral or any distribution of
     interest or principal, nor shall loss of, or damage to, the Collateral
     release the Borrower from any of the Obligations.

                                       31
<PAGE>   33

     6.3 FINANCIAL STATEMENTS AND BUSINESS CONDITION. The Financial Statements
fairly present the respective financial conditions and results of operations of
Borrower as of the date or dates thereof and for the periods covered thereby.
There were no material liabilities, direct or indirect, fixed or contingent, of
Borrower as of the dates of such Financial Statements which were not reflected
therein or in the notes thereto, which have not otherwise been disclosed to
Lender in writing. Except for any such changes heretofore expressly disclosed in
writing to Lender, there has been no material adverse change in the respective
financial conditions of Borrower from the financial conditions shown in their
respective Financial Statements, nor has Borrower incurred any material
liabilities, direct or indirect, fixed or contingent, which are not shown in its
Financial Statements. Borrower is able to pay all of its debts as they become
due and Borrower shall maintain such solvent financial condition, giving effect
to the Obligations, as long as the Borrower is obligated to Lender under the
Agreement or in any other manner whatsoever. Borrower's Obligations under this
Agreement and under the Loan Documents will not render Borrower unable to pay
its debts as they become due. The present fair market value of Borrower's assets
is greater than the amount required to pay its total liabilities.

     6.4 TAXES. In accordance with the requirements set forth in the
Declaration, the Borrower represents and warrants that the Borrower or Timeshare
Owners' Association, as required, has paid or will have paid in full, prior to
delinquency, all ad valorem taxes and other taxes and assessments against the
Resort and the Collateral; and the Borrower knows of no basis for any additional
taxes or assessments against the Resort or the Collateral. The Borrower or the
Timeshare Owners' Association, as the case may be, has filed all tax returns
required to have been filed by it and has paid or will pay prior to delinquency,
all taxes shown to be due and payable on such returns, including interest and
penalties, and all other taxes which are payable by it to the extent the same
have become due and payable.

     6.5 TITLE TO PROPERTIES: PRIOR LIENS. Borrower has good and marketable
title to all of the Collateral, and to all unsold Units and Intervals at each
Resort, and all rights, properties and benefits appurtenant to or benefiting
them. Borrower is not in default under any of the documents evidencing or
securing any indebtedness which is secured, wholly or in part, by any portion of
any Resort or any portion or all the Collateral and no event has occurred which
with the giving of notice, the passage of time or both, would constitute a
default under any of the documents evidencing or securing any such indebtedness.
Other than the Liens granted in favor of Lender, the Liens granted to secure the
Additional Credit Facility and the Existing Credit Facility and the Liens
described in Schedule 6.5 hereto, there are no liens or encumbrances against the
Collateral, or against any Resort.

                                       32
<PAGE>   34
     6.6 SUBSIDIARIES, AFFILIATES AND CAPITAL STRUCTURE. Borrower has no
subsidiaries or Affiliates which have any involvement or interest in any Resort
in any way. None of the Affiliates of Borrower are parties to any proxies,
voting trusts, shareholders agreements or similar arrangements pursuant to which
voting authority, rights or discretion with respect to the Borrower is vested in
any other Person.

     6.7 LITIGATION, PROCEEDINGS, ETC. There are no actions, suits, proceedings,
orders or injunctions pending or threatened against or affecting Borrower, the
Resort or the Timeshare Owners' Association at law or in equity, or before or by
any governmental authority or other tribunal, which (a) could have a material
adverse effect on Borrower or (b) relate to the Loan or which could have a
material effect on the Collateral or the Resort. Borrower has received no notice
from any court, governmental authority or other tribunal alleging that Borrower
or the Resort have violated the Timeshare Act, any of the rules or regulations
thereunder, the Declaration or any other applicable laws, agreements or
arrangements that could have any material effect on the Loan, the Collateral or
the Resorts.

     6.8 LICENSES, PERMITS, ETC. The Borrower, the Resorts, the Timeshare
Owners' Associations or Borrower's Affiliates involved in the operations of the
Resorts, and, to the best of Borrower's knowledge after diligent inquiry, other
Persons involved in the operations of the Resorts, possess all requisite
franchises, certificates of convenience and necessity, operating rights,
approvals, licenses, permits, consents, authorizations, exemptions and orders as
are necessary to carry on its or their business as now being conducted, without
any known conflict with the rights of others and, with respect to the Borrower,
the Resorts and the Timeshare Owners' Associations, in each case subject to no
mortgage, pledge, Lien, lease, encumbrance, charge, security interest, title
retention agreement or option other than as provided for by this Agreement.

     6.9 ENVIRONMENTAL MATTERS. Except as otherwise noted on Schedule 6.9, (a)
no Resort contains any Hazardous Materials, (b) no Hazardous Materials are used
or stored at or transported to or from the Resorts, (c) neither Borrower nor the
Resorts nor any manager thereof or to Borrower's knowledge, the Timeshare
Owners' Associations, have received notice from any governmental agency, entity
or other Person with regard to Hazardous Materials on, under or affecting any
Resort, and (d) neither Borrower nor the Resorts, nor any portion thereof, nor
to Borrower's knowledge after diligent inquiry, the Timeshare Owners'
Associations, are in violation of any Environmental Laws.

     6.10 FULL DISCLOSURE. No information, exhibit or written report or the
content of any schedule furnished by or on behalf of Borrower to Lender in
connection with the Loan or the Resorts contains any material misstatement of
fact or omits the statement of a material fact necessary to make the statement
contained herein or therein not misleading. Borrower knows of no fact or
condition which will prevent the sale of Intervals to Purchasers or prevent the
operation of

                                       33
<PAGE>   35

the Resorts in accordance with the Declarations and related public offering
statements, and in accordance with applicable law, or prevent Borrower's
performing its Obligations pursuant to the Loan Documents.

     6.11 USE OF PROCEEDS/MARGIN STOCK. None of the proceeds of the Loan will be
used to purchase or carry any "margin stock" (as defined under Regulation U of
the Board of Governors of the Federal Reserve System, as in effect from time to
time), and no portion of the proceeds of the Loan will be extended to others for
the purpose of purchasing or carrying margin stock. None of the transactions
contemplated in the Agreement (including, without limitation, the use of the
proceeds from the Loan) will violate or result in the violation of Section 7 of
the Securities Exchange Act of 1934, as amended, or any regulations issued
pursuant thereto, including, without limitation, Regulations G, T, U and X of
the Board of Governors of the Federal Reserve System, 12 C.F.R., Chapter 11.

     6.12 NO DEFAULTS. No Default or Event of Default exists, and there is no
violation in any material respect of any term of any agreement, charter
instrument, bylaw or other instrument to which the Borrower is a party or by
which it may be bound.

     6.13 COMPLIANCE WITH LAW. The Borrower

          (a) is not in violation, nor are any of its Resorts, or the business
     operations in respect of any of the Resorts, or to the Borrower's knowledge
     after diligent inquiry, the Timeshare Owners' Association, in violation, of
     the Timeshare Act, or any laws, ordinances, governmental rules or
     regulations of any state in which a Resort is located, any political
     subdivision of said states or any other jurisdiction to which the Borrower
     or the Resorts, or the business operations conducted in respect of the
     Resorts, or the Timeshare Owners' Association, are subject; and

          (b) has not failed, nor have the Resorts or, to Borrower's knowledge,
     the Timeshare Owners' Associations failed, to obtain any consents or
     joinders, or any approvals, licenses, permits, franchises or other
     governmental authorizations, or to make or cause to be made any filings,
     submissions, registrations or declarations with any government or agency or
     department thereof, necessary to the establishment, ownership or operation
     of the Resorts or any of Borrower's Properties, or to the conduct of
     Borrower's business, including, without limitation, the operation of the
     Resorts and the sale, or offering for sale, of Intervals therein; which
     violation or failure to obtain or register materially adversely affects the
     Borrower, the Resorts or the business, prospects, profits, properties or
     condition (financial or otherwise) of the Borrower or the Resorts. The
     Borrower has, to the extent required by its activities and businesses, and
     the operations of the Resorts, fully complied with (1) all of the
     applicable provisions of (a) the Consumer Credit Protection Act; (b)
     Regulation Z of the Federal

                                       34
<PAGE>   36

     Reserve Board; (c) the Equal Credit Opportunity Act; (d) Regulation B of
     the Federal Reserve Board; (e) the Federal Trade Commission's 3-day
     cooling-off Rule for Door-to-Door Sales; (f) Section 5 of the Federal Trade
     Commission Act; (g) the Interstate Land Sales Full Disclosure Act ("ILSA");
     (h) federal postal laws; (i) applicable state and federal securities laws;
     (j) applicable usury laws; (k) applicable trade practices, home and
     telephone solicitation, sweepstakes, anti-lottery and consumer credit and
     protection laws; (l) applicable real estate sales licensing, disclosure,
     reporting and escrow laws; (m) the Americans With Disabilities Act and
     related accessibility guidelines ("ADA"); (n) the Real Estate Settlement
     Procedures Act ("RESPA"); (o) all amendments to and rules and regulations
     promulgated under the foregoing acts or laws; and (p) other applicable
     federal statutes and the rules and regulations promulgated thereunder; and
     (2) all of the applicable provisions of the Timeshare Acts, any law or laws
     of any state (and the rules and regulations promulgated thereunder)
     relating to ownership, establishment or operation of the Resort, or the
     sale, offering for sale, or financing of Intervals.

     6.14 RESTRICTIONS OF BORROWER. Neither the Borrower nor any Resort, nor to
the Borrower's knowledge, any Timeshare Owners' Association, is a party to any
contract or agreement, or subject to any Lien, charge or corporate restriction,
which materially and adversely affects its or their business. The Borrower will
not be, on or after the Closing Date, a party to any contract or agreement which
restricts its right or ability to incur indebtedness, or prohibits the
Borrower's execution of, or compliance with the terms of this Agreement or the
other Loan Documents. The Borrower has not agreed or consented to cause or
permit in the future (upon the happening of a contingency or otherwise) any of
the Collateral, whether now owned or hereafter acquired, to be subject to a Lien
except in favor of Lender as provided hereunder.

     6.15 BROKER'S FEES. Borrower and Lender represent to each other that
neither of them has made any commitment or taken any action which will result in
a claim for any brokers', finders' or other similar fees or commitments with
respect to the transactions described in the Agreement. The Borrower agrees to
indemnify Lender and save and hold Lender harmless from all claims of any Person
for any broker's or finder's fee or commission, and this indemnity shall include
reasonable attorneys' fees and legal expenses.

     6.16 DEFERRED COMPENSATION PLANS. The Borrower has no pension, profit
sharing or other compensatory or similar plan (herein called a "Plan") providing
for a program of deferred compensation for any employee or officer. No fact or
situation, including but not limited to, any "Reportable Event," as that term is
defined in Section 4043 of the Employee Retirement Income Security Act of 1974
as the same may be amended from time to time ("Pension Reform Act"), exists or
will exist in connection with any Plan of the Borrower which might constitute
grounds for termination of any Plan by the Pension Benefit Guaranty Corporation
or cause the appointment by the appropriate United States District Court of a
Trustee to administer any such Plan. No

                                       35
<PAGE>   37

"Prohibited Transaction" within the meaning of Section 406 of the Pension Reform
Act exists or will exist upon the execution and delivery of the Agreement or the
performance by the parties hereto of their respective duties and obligations
hereunder. The Borrower will (1) at all times make prompt payment of
contributions required to meet the minimum funding standards set forth in
Sections 302 through 305 of the Pension Reform Act with respect to each of its
Plans; (2) promptly, after the filing thereof, furnish to the Lender copies of
each annual report required to be filed pursuant to Section 103 of the Pension
Reform Act in connection with each Plan for each Plan Year, including any
certified financial statements or actuarial statements required pursuant to said
Section 103; (3) notify the Lender immediately of any fact, including, but not
limited to, any Reportable Event arising in connection with any Plan which might
constitute grounds for termination thereof by the Pension Benefit Guaranty
Corporation or for the appointment by the appropriate United States District
Court of a Trustee to administer the Plan; and (4) notify the Lender of any
"Prohibited Transaction" as that term is defined in Section 406 of the Pension
Reform Act. The Borrower will not (a) engage in any Prohibited Transaction or
(b) terminate any such Plan in a manner which could result in the imposition of
a Lien on the Property of the Borrower pursuant to Section 4068 of the Pension
Reform Act.

     6.17 LABOR RELATIONS. The employees of the Borrower are not a party to any
collective bargaining agreement with the Borrower, and, to the best knowledge of
the Borrower and its officers, there are no material grievances, disputes or
controversies with any union or any other organization of the Borrower's
employees, or threats of strikes, work stoppages or any asserted pending demands
for collective bargaining by any union or organization.

     6.18 RESORT.

          (a) TIMESHARE PLAN. Each Resort has been established and dedicated,
     and is and will remain, a time-share plan and project in full compliance
     with all applicable laws and regulations, including without limitation, the
     Timeshare Act.

          (b) ACCESS. Each Resort has direct access to a publicly dedicated road
     and all roadways inside each Resort are subject to an access and use
     easement or other dedication or provision that benefits and will continue
     to benefit all Purchasers.

          (c) UTILITIES. Electric, sanitary and stormwater sewer, telephone,
     water facilities and other necessary utilities are available in sufficient
     capacity to service each Resort and any easements necessary to the
     furnishing of such utility services have been obtained and duly recorded,
     and inure to the benefit of each Resort and each Timeshare Owners'
     Association.

                                       36
<PAGE>   38

          (d) AMENITIES. Each Purchaser of an Interval has and will have access
     to and the full use and enjoyment of all of the Common Elements and public
     utilities of the Resort in which such interval is located, all in
     accordance with the Declaration and Timeshare Documents.

          (e) CONSTRUCTION. All costs arising from the construction or
     acquisition of any Units and any other improvements and the purchase of any
     fixtures or equipment, inventory, furnishings or other personalty located
     in, at, or on the Resorts have been paid or will be paid when due.

          (f) SALE OF INTERVALS. The marketing, sale, offering of sale, rental,
     solicitation of Purchasers or, if applicable, lessees, and financing of
     Intervals in the Resort (1) do not constitute the sale, or the offering of
     sale, of Securities subject to the registration requirements of the
     Securities Act of 1933, as amended, or any state securities law; (2) do not
     violate the Timeshare Act or any land sales or consumer protection law,
     statute or regulation of state or any other state or jurisdiction in which
     a Purchaser resides or in which sales or solicitation activities occur; and
     (3) do not violate any consumer credit or usury statute of state or any
     other state or jurisdiction in which a Purchaser resides or in which sales
     or solicitation activities occur. All marketing and sales activities are
     performed by employees of Borrower, all of whom are and shall be properly
     licensed in accordance with applicable laws.

          (g) TANGIBLE PROPERTY. Except for specific items which may be owned by
     independent contractors, the machinery, equipment, fixtures, tools and
     supplies used in connection with the Resort, including without limitation,
     with respect to the operations and maintenance of the Common Elements, are
     owned either by the Borrower or the applicable Timeshare Owners'
     Association.

          (h) OPERATING CONTRACTS. The Borrower has entered into the contracts,
     agreements, and arrangements necessary, in Lender's reasonable judgement,
     for the operation of the Resorts, including but not limited to those with
     respect to utilities, maintenance, management, services, marketing and
     sales (hereinbelow defined as "Operating Contracts").

     6.19 TIMESHARE REGIMEN REPORTS. The Borrower has furnished to the Lender
true and correct copies of the Timeshare Documents listed on SCHEDULE 6.19,
which consist of all those placed on file by the Borrower with the Divisions or
any federal, state or local regulatory or recording agencies, offices or
departments. All such filings and/or recordations, and all joinders and consents
necessary in order to establish the plan in respect of the Resorts, including
without limitation, the Units, Intervals, and all appurtenant Common Elements,
and all related use and access rights, have been done or obtained and all laws,
regulations and statutes, and all agreements or arrangements, in connection
therewith have been complied with.

                                       37
<PAGE>   39

     6.20 OPERATING CONTRACTS. The contracts, agreements and arrangements
necessary, in Lender's reasonable judgement, to the operation of the Resorts,
including without limitation, with respect to utilities, maintenance,
management, services, marketing and sales under which the fees to be paid equal
or exceed $50,000.00 (collectively, all such agreements and arrangements
referred to herein as the "Operating Contracts") are unmodified and in full
force and effect and shall remain free and clear of any Lien.

     6.21 ARCHITECTURAL AND ENVIRONMENTAL CONTROL. All Units, Common Elements
and other improvements at, upon or appurtenant to the Resort are and will be in
compliance with the design, use, architectural and environmental control
provisions, if any, set forth in the Declaration.

     6.22 TAX IDENTIFICATION/SOCIAL SECURITY NUMBERS. The Borrower's federal
taxpayer's identification number is: 75-2259890.

     6.23 INVENTORY CONTROL PROCEDURES. Borrower has provided to Lender a true
and complete copy of the Borrower's Inventory, Sales and Assignments procedures
(the "Inventory Control Procedures"), a copy of which is attached hereto as
Schedule 6.23.

                             SECTION 7 -- COVENANTS

     7.1 AFFIRMATIVE COVENANTS. So long as any portion of the Obligations
remains unsatisfied, Borrower hereby covenants and agrees with Lender as
follows:

          (a) PAYMENT AND PERFORMANCE OF OBLIGATIONS. Borrower shall pay all of
     the Loan and related expenses when and as the same become due and payable,
     and Borrower shall strictly observe and perform all of the Obligations,
     including without limitation, all covenants, agreements, terms, conditions
     and limitations contained in the Loan Documents, and will do all things
     necessary which are not prohibited by law to prevent the occurrence of any
     Event of Default hereunder; and the Borrower will maintain an office or
     agency in the State of Texas where notices, presentations and demands in
     respect of the Loan Documents may be made upon the Borrower. Such office or
     agency and the books and records of the Borrower shall be maintained at
     1221 Riverbend Drive, Suite 120, Dallas, Texas 75221 until such time as the
     Borrower shall so notify the Lender, in writing, of any change of location
     of such office or agency.

          (b) MAINTENANCE OF EXISTENCE, QUALIFICATION AND ASSETS. Borrower shall
     at all times (i) maintain its legal existence, (ii) maintain its
     qualification to transact business and good standing in any state and in
     any jurisdiction where it conducts business in

                                       38
<PAGE>   40

     connection with the Resort, and (iii) comply or cause compliance with all
     governmental laws, rules, regulations and ordinances applicable to the
     Resort, the Borrower or its business, including, without limitation, the
     Timeshare Act.

          (c) CONSOLIDATION AND MERGER. Borrower will not consolidate with or
     merge into any other Person or permit any other Person to consolidate with
     or merge into it, unless: (i) Borrower is the continuing or surviving
     corporation in any such consolidation or merger and (ii) prior to and
     immediately after such consolidation or merger, Borrower shall not be in
     default hereunder.

          (d) MAINTENANCE OF INSURANCE. The Borrower, or if required pursuant to
     the Declaration, the Timeshare Owners' Association, shall maintain (or the
     Borrower shall cause to be maintained) at all times during the term of this
     Agreement, policies of insurance with premiums being paid when due, and
     shall deliver to Lender originals of insurance policies issued by insurance
     companies, in amounts, in form and in substance, and with expiration dates,
     all acceptable to Lender and containing a waiver of subrogation rights by
     the insuring company, a non-contributory standard mortgage benefit clause,
     or their equivalents, and a mortgagee loss payable endorsement in favor of
     and satisfactory to Lender on behalf of Lender, and breach of warranty
     coverage, providing the following types of insurance on and with respect to
     the Borrower (or, as appropriate, the respective Associations) and the
     Resort:

               (i) Fire and extended coverage insurance (including lightning,
          hurricane, tornado, wind and water damage, vandalism and malicious
          mischief coverage) covering the improvements at the Resort and any
          personal property located in or on the Resort, in an amount not less
          than the full replacement value of such improvements and personal
          property, and said policy of insurance shall provide for a deductible
          acceptable to Lender, breach of warranty coverage, replacement cost
          endorsements satisfactory to Lender, and shall not permit
          co-insurance;

               (ii) Public liability and property damage insurance covering the
          Resort in amounts and on terms satisfactory to Lender; and

               (iii) Such other insurance on the Resort or any replacements or
          substitutions therefor including, without limitation, flood insurance
          (if the Property is or becomes located in an area which is considered
          a flood risk by the U.S. Emergency Management Agency or pursuant to
          the National Flood Insurance program), in such amounts and upon terms
          as may from time to time be reasonably required by Lender.

                                       39
<PAGE>   41

          To the extent any other lender has any rights to approve the form of
     insurance policies with respect to the Resort, the amounts of coverage
     thereunder, the insurers under such policies, or the designation of an
     attorney-in-fact for purposes of dealing with damage to any part of the
     Resort or insurance claims or matters related thereto, or any successor to
     such attorney-in-fact, or any changes with respect to any of the foregoing,
     Borrower shall take all steps as may be necessary (and, after turnover, if
     any, of control of the Resort to the Timeshare Owners' Association,
     Borrower shall use its best efforts) to ensure that Lender, shall at all
     times have a co-equal right, with such other lender (including, without
     limitation, Borrower or any third-party lender), to approve all such
     matters and any proposed changes in respect thereof; and Borrower shall not
     cause or permit any changes with respect to any insurance policies,
     insurers, coverage, attorney-in-fact, or insurance trustee, if any, without
     Lender's prior written approval.

          In the event of any insured loss or claim in respect of the Resort,
     Borrower shall apply (or cause to be applied), and Borrower covenants that
     the Timeshare Owners' Association shall apply (or cause to be applied), all
     proceeds of such insurance policies in a manner consistent with the
     Timeshare Documents and the Timeshare Act.

          All insurance policies required pursuant to this Agreement (or the
     Timeshare Documents or Timeshare Act) shall provide that the coverage
     afforded thereby shall not expire or be amended, canceled, modified or
     terminated without at least thirty (30) days prior written notice to
     Lender. At least thirty (30) days prior to the expiration date of each
     policy maintained pursuant to this Section 7.1(d), a renewal or replacement
     thereof satisfactory to Lender shall be delivered to Lender. Borrower shall
     deliver or cause to be delivered to Lender receipts evidencing the payment
     for all such insurance policies and renewals or replacements.

          In the event of any fire or other casualty to or with respect to the
     improvements on or at the Resort, Borrower covenants that Borrower or the
     Timeshare Owners' Association, as the case may be, will promptly restore or
     repair (or cause to be restored, repaired or replaced) the damaged
     improvements and repair or replace any other personal property to the same
     condition as immediately prior to such fire or other casualty and, with
     respect to the improvements and personal property on the Resort, in
     accordance with the terms of the Timeshare Documents or Timeshare Act. The
     insufficiency of any net insurance proceeds shall in no way relieve the
     Borrower or, as applicable, Borrower and Timeshare Owners' Association, of
     its obligation to restore, repair or replace such improvements and other
     personal property in accordance with the terms hereof, of the Declaration
     or other Timeshare Documents or of the Timeshare Act, and Borrower
     covenants that Borrower or, as the case may be, the Timeshare Owners'
     Association, shall promptly comply and cause compliance with the provisions
     of the Declaration and other

                                       40
<PAGE>   42

     Timeshare Documents, or of the Timeshare Act relating to such restoration,
     repair or replacement. In Lender's sole discretion, all insurance proceeds
     payable to or received by Lender pursuant to the Declaration or the
     applicable policies may be applied to the payment of the Obligations,
     whether or not due and in whatever order Lender elects.

          (e) MAINTENANCE OF SECURITY. Borrower shall execute and deliver (or
     cause to be executed and delivered) to Lender all security agreements,
     financing statements, assignments and such other agreements, documents,
     instruments and certificates, and supplements and amendments thereto, and
     take such other actions, as Lender deems necessary or appropriate in order
     to maintain as valid, enforceable and perfected first priority liens and
     security interests, all Liens and security interests in the Collateral
     granted to Lender to secure the Obligations. The Borrower shall not grant
     extensions of time for the payment of, compromise for less than the full
     face value or release in whole or in part, any Purchaser or other Person
     liable for the payment of, or allow any credit whatsoever except for the
     amount of cash to be paid upon, any Collateral or any instrument, chattel
     paper or document representing the Collateral.

          (f) PAYMENT OF TAXES AND CLAIMS. Borrower will pay, and, as applicable
     pursuant to the Declaration, Borrower covenants that the Timeshare Owners'
     Association will pay, when due, all taxes imposed upon the Resort, the
     Collateral, the Borrower, the Timeshare Owners' Association, or any of its
     or their property, or with respect to any of its or their franchises,
     businesses, income or profits, or with respect to the Loan or any of the
     Loan Documents; and Borrower and the Timeshare Owners' Association, as the
     case may be, shall pay all other charges and assessments against Borrower,
     the Collateral and the Resort before any claim (including, without
     limitation, claims for labor, services, materials and supplies) arises for
     sums which have become due and payable. Except for the Liens in connection
     with the Existing Credit Facility and the Additional Credit Facility and
     the Liens in favor of Lender granted pursuant to the Loan Documents, and
     except as otherwise specifically provided for herein, Borrower covenants
     that no statutory or other Liens whatsoever (including, without limitation,
     mechanics', materialmens', judgment or tax liens) shall attach to any of
     the Collateral or the Resort except for such Liens as are expressly
     provided for pursuant to the Declaration, which shall, in any event, be
     subordinate to the Lien of Lender. In the event any such Lien attaches to
     any of the Collateral or the Resort Borrower shall, within thirty (30) days
     after any such Lien attaches, either (i) cause such Lien to be released of
     record or (ii) provide Lender with a bond in accordance with the applicable
     laws of the State, issued by a corporate surety acceptable to Lender, in an
     amount and form acceptable to Lender.

          (g) INSPECTIONS. Borrower shall, at any time and from time to time and
     at the expense of Borrower, permit Lender or its agents or representatives
     to inspect the Resort, the Collateral and if necessary, in Lender's
     opinion, to ascertain or assure Borrower's

                                       41
<PAGE>   43

     compliance with the terms of this Agreement, any of the Borrower's other
     assets or Property, and to examine and make copies of and abstracts from
     its and, to the extent it has access thereto or possession thereof, the
     Timeshare Owners' Association's, books, accounts, records, original
     correspondence, computer tapes, disks, software, and other papers as it may
     desire; and to discuss its affairs, finances and accounts with any of its
     officers, employees, Affiliates, contractors or independent public
     accountants (and by this provision Borrower authorizes said accountants to
     discuss with Lender, its agents or representatives, the affairs, finances
     and accounts of Borrower). Lender agrees to use reasonable efforts not to
     unreasonably interfere with Borrower's business operations in connection
     with any such inspections.

          (h) REPORTING REQUIREMENTS. So long as any portion of the Obligations
     remain unsatisfied, Borrower shall furnish (or cause to be furnished, as
     the case may be) to Lender the following:

               (i) SALES REPORTS. Borrower shall deliver to Lender monthly,
          quarterly and annually, a sales report, detailing the sales of all
          Intervals at the Resorts for the period covered thereby, certified by
          Borrower to be true, correct and complete and otherwise in a form
          approved by Lender;

               (ii) FINANCIAL REPORTS. Borrower shall deliver to Lender each of
          the monthly, quarterly and annual financial reports, together with
          audit reports and officer's certificates, as required under Section
          7.1(h) of the loan agreements evidencing and securing the Additional
          Credit Facility and the Existing Credit Facility. This requirement
          shall survive the payment in full by the Borrower of any obligations
          due or owing under either the Additional Credit Facility or the
          Existing Credit Facility or the assignment by Lender of its rights
          under the Additional Credit Facility or the Existing Credit Facility.

               (iii) NOTICE OF DEFAULT OR EVENT OF DEFAULT. Immediately upon
          becoming aware of the existence of any condition or event which
          constitutes a Default or an Event of Default, a written notice
          specifying the nature and period of existence thereof and what action
          the Borrower is taking or proposes to take with respect thereto;

               (iv) NOTICE OF CLAIMED DEFAULT. Immediately upon becoming aware
          that the holder of any material obligation or of any evidence of
          material indebtedness of the Borrower has given notice or taken any
          other action with respect to a claimed default or event of default
          thereunder, a written notice specifying the notice given or action
          taken by such holder and the nature of the claimed default or event of
          default and what action the Borrower is taking or proposes to take
          with respect thereto;

                                       42
<PAGE>   44

               (v) MAINTENANCE OF INVENTORY CONTROL. Borrower shall maintain and
          at all times fully comply with the Inventory Control Procedures from
          the date hereof until the Loan is repaid in full. Borrower shall
          permit Lender, its officers, employees, auditors, and other agents or
          designees to review the books and records of Borrower and make such
          other examinations and inspections as Lender in its sole discretion
          deems necessary to determine that Borrower is in full compliance with
          such Inventory Control Procedures.

               (vi) MATERIAL ADVERSE DEVELOPMENTS. Immediately upon becoming
          aware of any claim, action, proceeding, development or other
          information which may materially and adversely affect the Borrower,
          the Collateral, the Resort, or the business, prospects, profits or
          condition (financial or otherwise) of the Borrower or the ability of
          the Borrower to perform its Obligations under the Agreement, Borrower
          shall provide Lender with telephonic or telegraphic notice, followed
          by telefaxed and mailed written confirmation, specifying the nature of
          such development or information and such anticipated effect.

          (i) RECORDS. Borrower shall keep adequate records and books of account
     reflecting all financial transactions of Borrower and with respect to the
     Resort in which complete entries will be made in accordance with GAAP. In
     addition, Borrower shall keep, and shall promptly deliver to Lender upon
     Lender's request therefore, complete, timely and accurate records of all
     sales of Intervals.

          (j) MANAGEMENT. Borrower shall: (i) remain engaged in the active
     management of the Resorts, (ii) unless Borrower notifies Lender in writing
     at least thirty (30) days in advance of its new location, it will retain
     its executive offices at 1221 Riverbend Drive, Suite 120, Dallas, Texas
     75221, and (iii) will continue to perform duties substantially similar to
     those presently performed as provided in the Management Agreement relating
     to each Resort.

          (k) FICA. Borrower shall furnish to Lender within thirty (30) days
     after the expiration of each calendar quarter proof reasonably satisfactory
     to Lender that Borrower's obligations to make deposits for F.I.C.A., social
     security and withholding taxes have been satisfied.

          (l) OPERATING CONTRACTS. Subject to the rights of the Timeshare
     Owners' Association as set forth in the Timeshare Documents, no Operating
     Contract shall be modified, extended, terminated or entered into, without
     the prior written approval of

                                       43
<PAGE>   45

     Lender, if any such modification, extension, termination or new agreement
     could have an adverse impact on the operation of the Resort or the
     Collateral.

          (m) NOTICES. Borrower shall notify Lender within five (5) Business
     Days of the occurrence of any event (i) as a result of which any
     representation or warranty of Borrower contained in any Loan Documents
     would be incorrect or materially misleading if made at that time, or (ii)
     as a result of which Borrower is not in full compliance with all of its
     covenants and agreements contained in this Agreement or any Loan Document,
     or (iii) which constitutes or, with the passage of time, notice or a
     determination by Lender would constitute, an Event of Default.

          (n) MAINTENANCE. Borrower shall maintain, or shall cause to be
     maintained, or to the extent provided for pursuant to the Declaration,
     shall use its best efforts to cause the Timeshare Owners' Association to
     maintain, the Resort in good repair, working order and condition and shall
     make all necessary replacements and improvements to the Resort so that the
     value and operating efficiency of the Resort will be maintained at all
     times and so that the Resort remains in compliance in all respects with the
     Timeshare Act, the Timeshare Documents and other applicable law.

          (o) CLAIMS. Borrower shall promptly notify Lender of any claim, action
     or proceeding affecting the Resort or Collateral, or any part thereof, or
     Lender, or any of the security interests or rights granted in favor of
     Lender hereunder or under any of the Loan Documents. At the request of
     Lender, Borrower shall appear in and defend in favor of Lender, at
     Borrower's sole expense, with regard to any such claim, action or
     proceeding.

          (p) REGISTRATION AND REGULATIONS.

               (i) LOCAL LEGAL COMPLIANCE. The Borrower will comply, and will
          cause the Resort to comply, with all applicable servitudes,
          restrictive covenants, applicable planning, zoning or land use
          ordinances and building codes, all applicable health and Environmental
          Laws and regulations, and all other applicable laws, rules,
          regulations, agreements or arrangements.

               (ii) REGISTRATION COMPLIANCE. The Borrower will maintain, or
          cause to be maintained, all necessary registrations, current filings,
          consents, franchises, approvals, and exemption certificates, and the
          Borrower will make or pay, or cause to be made or paid, all
          registrations, declarations or fees with the Division and any other
          government or any agency or department thereof, whether in the state
          or another jurisdiction, required in connection with the Resort and
          the occupancy, use and operation thereof, the incorporation of Units
          into the time-share plan established

                                       44
<PAGE>   46

          pursuant to the Declaration and the other Timeshare Documents, and the
          sale, advertising, marketing, and offering for sale of Intervals. All
          such registrations, filings and reports will be truthfully completed;
          and true and complete copies of such registrations, applications,
          consents, licenses, permits, franchises, approvals, exemption
          certificates, filings and reports will be delivered to the Lender.
          Borrower shall advise Lender of any changes with respect to its
          marketing or sales programs in any jurisdiction, including
          jurisdictions other than the state, and at Lender's request from time
          to time, Borrower shall deliver to Lender: (A) written statements by
          the applicable state authorities, in form acceptable to Lender,
          stating that no registration is necessary for the sale of Intervals in
          the particular state, (B) an opinion of counsel in form acceptable to
          Lender and rendered by counsel acceptable to Lender, stating that no
          such registration is necessary, or (C) such other evidence of
          compliance with applicable laws as Lender may require; and

               (iii) OTHER COMPLIANCE. The Borrower has, in all material
          respects, complied with and will comply with all laws and regulations
          of the United States, the State of Texas, the each state in which an
          applicable Resort is located, any political subdivision of either such
          state and any other governmental, quasi-governmental or administrative
          jurisdiction in which Intervals have been sold or offered for sale, or
          in which sales, offers of sale or solicitations with respect to the
          Resort have been or will be conducted, including to the extent
          applicable, but not limited to: (1) the Timeshare Act; (2) the
          Consumer Credit Protection Act; (3) Regulation Z of the Federal
          Reserve Board; (4) the Equal Credit Opportunity Act; (5) Regulation B
          of the Federal Reserve Board; (6) the Federal Trade Commission's 3-day
          cooling-off Rule for Door-to-Door Sales; (7) Section 5 of the Federal
          Trade Commission Act; (8) ILSA; (9) federal postal laws; (10)
          applicable state and federal securities laws; (11) applicable usury
          laws; (12) applicable trade practices, home and telephone
          solicitation, sweepstakes, anti-lottery and consumer credit and
          protection laws; (13) applicable real estate sales licensing,
          disclosure, reporting and escrow laws; (14) the ADA; (15) RESPA; (16)
          all amendments to and rules and regulations promulgated under the
          foregoing acts or laws; and (17) other applicable federal statutes and
          the rules and regulations promulgated thereunder; and (18) any state
          law or law of any state (and the rules and regulations promulgated
          thereunder) relating to ownership, establishment or operation of the
          Resort, or the sale, offering for sale, or financing of Intervals.

          (r) OTHER DOCUMENTS. The Borrower will maintain to the satisfaction of
     the Lender, and make available to Lender, accurate and complete files
     relating to the Resort, the Pledged Notes Receivable and other Collateral,
     and such files will contain true copies of each Pledged Note Receivable, as
     amended from time to time, copies of all relevant credit

                                       45
<PAGE>   47

     memoranda relating to such Notes Receivable and all collection information
     and correspondence relating thereto.

          (s) FURTHER ASSURANCES. Borrower will execute and deliver, or cause to
     be executed and delivered, such other and further agreements, documents,
     instruments, certificates and assurances as, in the judgment of Lender
     exercised in good faith may be necessary or appropriate to more effectively
     evidence or secure, and to ensure the performance of, the Obligations. In
     addition, Borrower shall deliver to Lender from time to time upon each
     request by Lender such documents, instruments or other matters or items as
     Lender may require to evidence Borrower's compliance with the covenants set
     forth in this Section 7.1.

          (t) UTILITIES. The Borrower will cause, or to the extent provided for
     pursuant to the Declaration, covenants to use its best efforts to ensure
     that the Timeshare Owners' Association, or the manager of the Resort, as
     applicable, will cause, electric, sanitary and stormwater sewer, water
     facilities, drainage facilities, solid waste disposal, telephone and other
     necessary utilities to be available to the Resort in sufficient capacity to
     service the Resort.

          (u) AMENITIES. The Borrower will cause, or to the extent provided for
     pursuant to the Declarations, will use its best efforts to ensure that the
     Timeshare Owners' Association, or the manager of the Resort, as applicable,
     will cause, the Resort to be maintained in good condition and repair, and
     in accordance with the provisions of the applicable Timeshare Documents,
     and the Borrower will cause each Purchaser of an Interval at the Resort to
     have continuing access to, and the use of, to the extent of such
     Purchaser's time-share periods, all of the Common Elements and related or
     appurtenant services, rights and benefits, all as provided in the
     Declaration and the Timeshare Documents.

          (v) EXPENSES AND CLOSING FEES. Whether or not the transactions
     contemplated hereunder are completed, the Borrower shall pay all expenses
     of the Lender relating to negotiating, preparing, documenting, closing and
     enforcing this Agreement, including, but not limited to:

               (i) the cost of preparing, reproducing and binding this
          Agreement, the other Loan Documents and all Exhibits and Schedules
          thereto;

               (ii) the fees and disbursements of Lender's counsel;

               (iii) Lender's out-of-pocket expenses;

                                       46
<PAGE>   48

               (iv) all fees and expenses (including fees and expenses of the
          Lender's counsel) relating to any amendments, waivers, consents or
          subsequent closings pursuant to the provisions hereof;

               (v) all costs, outlays, legal fees and expenses of every kind and
          character had or incurred in (1) the interpretation or enforcement of
          any of the provisions of, or the creation, preservation or exercise of
          rights and remedies under, any of the Loan Documents including the
          costs of appeal (2) the preparation for, negotiations regarding,
          consultations concerning, or the defense or prosecution of legal
          proceedings involving any claim or claims made or threatened against
          the Lender arising out of this transaction or the protection of the
          Collateral securing the Loan or Advances made hereunder, expressly
          including, without limitation, the defense by Lender of any legal
          proceedings instituted or threatened by any Person to seek to recover
          or set aside any payment or setoff theretofore received or applied by
          the Lender with respect to the Obligations, and any and all appeals
          thereof; and (3) the advancement of any expenses provided for under
          any of the Loan Documents;

               (vi) all expenses relating to the maintenance and administration
          of any other escrow agent;

               (vii) all costs and expenses incurred by Lender under the Note,
          and all late charges under the Note; and

               (viii) all real and personal property taxes and assessments,
          documentary stamp and intangible taxes, sales taxes, recording fees,
          title insurance premiums and other title charges, document copying,
          transmittal and binding costs, appraisal fees, lien and judgment
          search costs, fees of architects, engineers, environmental
          consultants, surveyors and any special consultants, construction
          inspection fees, brokers fees, escrow fees, wire transfer fees, and
          all travel and out-of-pocket expenses of Lender to conduct inspections
          or audits; Without limitation of the foregoing, Borrower shall pay the
          costs of UCC and other searches, UCC and other Loan Document recording
          fees and applicable taxes, and premiums on each Mortgagee Policy of
          Title Insurance delivered to Lender pursuant to this Agreement.

          (w) INDEMNIFICATION OF LENDER. In addition to (and not in lieu of) any
     other provisions of any Loan Document providing for indemnification in
     favor of the Lender, the Borrower shall defend, indemnify and hold harmless
     Lender, its subsidiaries, affiliates, officers, directors, agents,
     employees, representatives, consultants, contractors, servants, and
     attorneys, as well as the respective heirs, personal representatives,
     successors or assigns of any or all of them (hereafter collectively the
     "Indemnified Lender Parties"), from and

                                       47
<PAGE>   49
     against, and promptly pay on demand or reimburse each of them with respect
     to, any and all liabilities, claims, demands, losses, damages, costs and
     expenses (including without limitation, reasonable attorneys' and
     paralegals' fees and costs), actions or causes of action of any and every
     kind or nature whatsoever asserted against or incurred by any of them by
     reason of or arising out of or in any way related or attributable to (i)
     this Agreement, the Loan Documents, the Loan or the Collateral; (ii) the
     transactions contemplated under any of the Loan Documents or any of the
     Timeshare Documents, including without limitation, those in any way
     relating to or arising out of the violation of any federal or state laws,
     including the Timeshare Act; (iii) any breach of any covenant or agreement
     or the incorrectness or inaccuracy of any representation and warranty of
     the Borrower contained in this Agreement or any of the Loan Documents
     (including without limitation any certification of the Borrower delivered
     to a Lender; (iv) any and all taxes, including real estate, personal
     property, sales, mortgage, excise, intangible or transfer taxes, and any
     and all fees or charges, including, without limitation under the Timeshare
     Act, which may at any time arise or become due prior to the payment,
     performance and discharge in full of the Obligations; (v) the breach of any
     representation or warranty as set forth herein regarding any Environmental
     Laws; (vi) the failure of Borrower to perform any obligation or covenant
     herein required to be performed pursuant to any Environmental Laws; (vii)
     the use, generation, storage, release, threatened release, discharge,
     disposal or presence on, under or about the Resort of any Hazardous
     Materials; (viii) the removal or remediation of any Hazardous Materials
     from the Resort required to be performed pursuant to any Environmental Laws
     or as a result of recommendations of any environmental consultant or as
     required by Lender; (ix) claims asserted by any Person (including without
     limitation any governmental or quasi-governmental agency, commission,
     department, instrumentality or body, court, arbitrator or administrative
     board (collectively, a "Governmental Agency"), in connection with or any in
     any way arising out of the presence, use, storage, disposal, generation,
     transportation, release, or treatment of any Hazardous Materials on, in,
     under or affecting the Resort; (x) the violation or claimed violation of
     any Environmental Laws in regard to the Resort; or (xi) the preparation of
     an environmental audit or report on the Resort, whether conducted by
     Lender, Borrower or a third-party, or the implementation of environmental
     audit recommendations. Such indemnification shall not give Borrower any
     right to participate in the selection of counsel for Lender or the conduct
     or settlement of any dispute or proceeding for which indemnification may be
     claimed. Lender agrees to give Borrower written notice of the assertion of
     any claim or the commencement of any action or lawsuit described in this
     Section. It is the express intention of the parties hereto that the
     indemnity provided for in this Section, as well as the disclaimers of
     liability referred to in this Agreement, are intended to and shall protect
     and indemnify Lender from the consequences of Lender's own negligence,
     whether or not that negligence is the sole or concurring cause of any
     liability, obligation. loss, damage, penalty, action, judgment, suit,
     claim, cost, expense or disbursement provided, however, that Borrower shall
     not be

                                       48
<PAGE>   50
     required to protect and indemnify Lender from the consequences of Lender's
     gross negligence, where that gross negligence is the sole cause of the
     liability, obligation, loss, damage, penalty, action, judgment, suit,
     claim, cost, expense or disbursement for which indemnification or
     protection would otherwise be required. The provisions of this Section
     shall survive the full payment, performance and discharge of the
     Obligations and the termination of this Agreement, and shall continue
     thereafter in full force and effect.

     7.2 NEGATIVE COVENANTS. So long as any portion of the Obligations remain
unsatisfied, Borrower hereby covenants and agrees with Lender as follows:

          (a) LIMITATION ON OTHER DEBT/FURTHER ENCUMBRANCES. Without the prior
     written consent of Lender which may be granted, withheld or conditioned in
     Lender's sole discretion, Borrower will not obtain financing or grant liens
     with respect to the Collateral. Provided that such financing is in the
     ordinary course of Borrower's business, Borrower may, however, obtain arms
     length financing in a manner consistent with Lender's rights under this
     Agreement with respect to any Units or Intervals, the Resorts or any
     Properties used in connection with the Resorts (whether now existing or
     created hereafter) other than those included among the Collateral.

          (b) RESTRICTIONS ON TRANSFERS. Except as hereinafter specifically
     provided, Borrower shall not, whether voluntarily or involuntarily, by
     operation of law or otherwise, (i) without obtaining the prior written
     consent of Lender (which consent may be given, withheld or conditioned by
     Lender in Lender's sole discretion), transfer, sell, pledge, convey,
     hypothecate, factor or assign all or any portion of the Collateral, the
     Encumbered Intervals, the Common Elements relating to the Inventory or any
     Resort facilities or amenities, or contract to do any of the foregoing,
     including, without limitation, pursuant to options to purchase, and
     so-called "installment sales contracts", "land contracts", or "contracts
     for deed", (ii) without obtaining the prior written consent of Lender
     (which consent may be given, withheld or conditioned by Lender in Lender's
     sole discretion), lease or license all or any portion of the Collateral,
     the Inventory, the Common Elements relating to the Inventory or any Resort
     facilities or amenities, or change the legal or actual possession or use
     thereof, (iii) permit the assignment, transfer, delegation, change,
     modification or diminution of the duties or responsibilities of Borrower,
     of any manager of the Resort approved by Lender as manager of the Resort
     (except for an assignment of such duties to a professional management
     company or companies reasonably acceptable to Lender in advance) without
     obtaining the prior written consent of Lender (which consent shall not be
     unreasonably withheld), or (iv) without obtaining the prior written consent
     of Lender (which consent may be given, withheld or conditioned by Lender in
     Lender's sole discretion), cause or permit the assignment, pledge or other
     encumbrance of any of the Operating Contracts or all or any portion of
     Borrower's right, title or interest in the

                                       49
<PAGE>   51

     Declaration. Without limiting the generality of the preceding sentence, and
     subject to the terms of this Agreement, the prior written consent of Lender
     (as specified above) shall be required for (A) any transfer of the
     Inventory, the Common Elements relating to the Inventory or any Resort
     facilities or amenities or any part thereof made to a subsidiary or
     Affiliate or otherwise, (B) any transfer of all or any part of the
     Inventory, the Common Elements relating to the Inventory or any Resort
     facilities or amenities by Borrower to its stockholders or Affiliates or
     vice versa, and (C) any corporate merger or consolidation, disposition or
     other reorganization, except as permitted in Section 7.1(c) hereof. In the
     event that Lender is willing to consent to a transfer which would otherwise
     be prohibited by this Section 7.2(b) Lender may condition its consent on
     such terms as it desires, including, without limitation, an increase in the
     Interest Rate and the requirement that Borrower pay a transfer fee,
     together with any expenses incurred by Lender in connection with the
     granting of such consent (including, without limitation, attorneys' fees
     and expenses). If Borrower violates the terms of this Section 7.2(b), in
     addition to any other rights or remedies which Lender may have herein, in
     any other Loan Document, or at law or in equity, Lender may by written
     notice to Borrower increase, effective immediately as of the date of such
     violation, the Interest Rate to the Default Rate.

          (c) USE OF A LENDER'S NAME. Borrower will not, and will not permit any
     Affiliate to, without the prior written consent of Lender, use the name of
     Lender or the name of any affiliate of Lender in connection with any of
     their respective businesses or activities, except in connection with
     internal business matters and as required in dealings with governmental
     agencies.

          (d) TRANSACTIONS WITH AFFILIATES. Without the prior written consent of
     Lender, which shall not unreasonably be withheld, Borrower will not enter
     into any transaction with any Affiliate in connection with the Resorts,
     including, without limitation, relating to the purchase, sale or exchange
     any assets or properties or the rendering of any service, except in the
     ordinary course of, and pursuant to the reasonable requirements of, the
     operations of the Resorts and upon fair and reasonable terms.

          (e) RESTRICTIVE COVENANTS. Borrower will not without Lender's prior
     written consent seek, consent to, or otherwise acquiesce in, any change in
     any private restrictive covenant, planning or zoning law or other public or
     private restriction, which would limit or alter the use of the Resort.

          (f) SUBORDINATED OBLIGATIONS. Borrower will not, directly or
     indirectly, (i) permit any payment to be made in respect of any
     indebtedness, liabilities or obligations, direct or contingent, (the
     "Subordinated Debt") to any of its shareholders or their affiliates or
     which are subordinated by the terms thereof or by separate instrument to
     the payment of

                                       50
<PAGE>   52

     principal of, and interest on, the Note, except that the Borrower may make
     and the Subordinated Lender may receive, accept and retain such payments so
     long as no Default or Event of Default under, and as defined, in the Loan
     Agreement shall have occurred and be continuing and such payments are in
     respect of regularly scheduled payments of principal and/or interest under
     the Subordinated Debt (the terms of which regularly scheduled payments
     shall have previously been approved, in writing by the Lender in its sole
     discretion) provided that in no case may the Borrower make, or the
     Subordinated Lender accept, a prepayment of any principal and/or interest
     in respect of the Subordinated Debt, (ii) permit the amendment, rescission
     or other modification of any such subordination provisions of any of the
     Borrower's subordinated obligations in such a manner as to affect adversely
     the Lien in and to the Collateral or Lender's senior priority position and
     entitlement as to payment and rights with respect to the Note and the
     Obligations, or (iii) permit the prepayment or redemption, except for
     mandatory prepayments, of all or any part of Borrower's obligations to its
     shareholders, or of any subordinated obligations of the Borrower except in
     accordance with the terms of such subordination.

          (g) TIMESHARE REGIME. Without Lender's prior written consent, Borrower
     shall not amend, modify or terminate the Declarations or other Timeshare
     Documents, or any other restrictive covenants, agreements or easements
     regarding the Resorts (except for routine non-substantive modifications
     which have no impact on the Collateral); nor shall Borrower assign its
     rights as "developer" under the Declarations without Lender's prior written
     consent, or file or permit to be filed any additional covenants,
     conditions, easements or restrictions against or affecting the Resorts (or
     any portion thereof) without Lender's prior written consent, which consent
     shall not be unreasonably withheld.

          (h) NAME CHANGE. Borrower will not change its name.

          (i) COLLATERAL. Borrower shall not take any action (nor permit or
     consent to the taking of any action) which might impair the value of the
     Collateral or any of the rights of the Lenders in the Collateral, nor shall
     Borrower cause or permit any amendment to or modification of the Timeshare
     Documents.

          (j) MARKETING/SALES. Borrower shall not market, attempt to sell or
     sell or permit or justify any sales or attempted sales of any Intervals
     except in compliance with the Timeshare Act and applicable laws in state
     and other jurisdictions where marketing, sales or solicitation activities
     occur.

                                       51
<PAGE>   53

                         SECTION 8 -- EVENTS OF DEFAULT

     8.1 NATURE OF EVENTS. An "Event of Default" shall exist if any of the
following shall occur:

          (a) PAYMENTS. If Borrower shall fail to make, as and when due, any
     payment or mandatory prepayment of principal, interest, fees or other
     amounts with respect to the Loan and such failure shall continue for five
     (5) days after notice of such failure is provided by Lender.

          (b) COVENANT DEFAULTS. If Borrower shall fail to perform or observe
     any covenant, agreement or warranty contained in this Agreement or in any
     of the Loan Documents, (other than with respect to the failure to make
     timely payments in respect of the Loan as provided in Section 8.1(a) or
     violation of any negative covenants in Section 7.2) and, such failure shall
     continue for fifteen (15) days after notice of such failure is provided by
     Lender, provided however, that if Borrower commences to cure such failure
     within such 15 day period, but, because of the nature of such failure, cure
     cannot be completed within 15 days notwithstanding diligent effort to do
     so, then, provided Borrower diligently seeks to complete such cure, an
     Event of Default shall not result unless such failure continues for a total
     of thirty (30) days.

          (c) WARRANTIES OR REPRESENTATIONS. If any representation or other
     statement made by or on behalf of Borrower in this Agreement, in any of the
     Loan Documents or in any instrument furnished in compliance with or in
     reference to the Loan Documents, is false, misleading or incorrect in any
     material respect as of the date made or reaffirmed.

          (d) ENFORCEABILITY OF LIENS. If any lien or security interest granted
     by Borrower to the Lenders in connection with the Loan is or becomes
     invalid or unenforceable or is not, or ceases to be, a perfected first
     priority lien or security interest in favor of the Lender encumbering the
     asset to which it is intended to encumber, and Borrower fails to cause such
     lien or security interest to become a valid, enforceable, first and prior
     lien or security interest in a manner satisfactory to Lender within ten
     (10) days after Lender delivers written notice thereof to Borrower.

          (e) INVOLUNTARY PROCEEDINGS. If a case is commenced or a petition is
     filed against Borrower under any Debtor Relief Law; a receiver, liquidator
     or trustee of Borrower or of any material asset of Borrower is appointed by
     court order and such order remains in effect for more than forty-five (45)
     days; or if any material asset of Borrower is sequestered by court order
     and such order remains in effect for more than forty-five (45) days.

                                       52
<PAGE>   54

          (f) PROCEEDINGS. If Borrower voluntarily seek, consent to or acquiesce
     in the benefit of any provision of any Debtor Relief Law, whether now or
     hereafter in effect; consent to the filing of any petition against it under
     such law; make an assignment for the benefit of its creditors; admit in
     writing its inability to pay its debts generally as they become due; or
     consents or suffers to the appointment of a receiver, trustee, liquidator
     or conservator for it, him or her or any part of its, his or her assets.

          (g) ATTACHMENT, JUDGMENT, TAX LIENS. The issuance, filing, levy or
     seizure against the Collateral, or, with respect to the Resort or the
     Obligations, against the Borrower of one or more attachments, injunctions,
     executions, tax liens or judgments for the payment of money cumulatively in
     excess of $100,000, which is not discharged in full or stayed within thirty
     (30) days after issuance or filing.

          (h) TIMESHARE DOCUMENTS. If the Declaration, any of the other
     documents creating or governing the Resort, its timeshare regime, or the
     Timeshare Owners' Association, or the restrictive covenants with respect to
     the Resort, shall be terminated, amended or modified without Lender's prior
     written consent (except for routine non-substantive modifications which
     have no impact on the Collateral).

          (i) REMOVAL OF COLLATERAL. If Borrower conceals, removes, transfers,
     conveys, assigns or permits to be concealed, removed, transferred, conveyed
     or assigned, any of the Collateral in violation of the terms of the Loan
     Documents or with the intent to hinder, delay or defraud its creditors or
     any of them including, without limitation, Lender.

          (j) OTHER DEFAULTS. If a material default shall occur in any of the
     covenants or Obligations set forth in any of the Loan Documents.

          (k) MATERIAL ADVERSE CHANGE. Any material adverse change in the
     financial condition of the Borrower in the condition of the Collateral. For
     purposes of this provision, a decline in the net worth of the Borrower of
     $100,000.00 or less shall not be considered a material adverse change.

          (l) DEFAULT BY BORROWER IN OTHER AGREEMENTS. Any default by the
     Borrower (i) in the payment of any indebtedness to Lender, including any
     indebtedness under the Existing Credit Facility or the Additional Credit
     Facility, (ii) in the payment or performance of other indebtedness for
     borrowed money or obligations secured by any part of the Resort; or (iii)
     in the payment or performance of other material indebtedness or obligations
     (material indebtedness or obligations being defined for purposes of this
     provision as any indebtedness or obligation in excess of $50,000) where
     such default accelerates or permits the

                                       53
<PAGE>   55

     acceleration (after the giving of notice or passage of time or both) of the
     maturity of such indebtedness, or permits the holders of such indebtedness
     to elect a majority of the board of directors of Borrower (whether or not
     such default[s] have been waived by such holder).

          (m) LOSS OF LICENSE. The loss, revocation or failure to renew or file
     for renewal of any registration, approval, license, permit or franchise now
     held or hereafter acquired by the Borrower or with respect to any Resort,
     or the failure to pay any fee, which is necessary for the continued
     operation of any Resort or the Borrower's business in the same manner as it
     is being conducted at the time of such loss, revocation, failure to renew
     or failure to pay.

          (n) VIOLATION OF NEGATIVE COVENANTS. Borrower violates any negative
     covenants set forth in Section 7.2.

                              SECTION 9 -- REMEDIES

     9.1 REMEDIES UPON DEFAULT. Should an Event of Default occur, Lender may
take any one or more of the actions described in this Section 9, all without
notice to Borrower:

          (a) ACCELERATION. Without demand or notice of any nature whatsoever,
     declare the unpaid balance of the Loans, or any part thereof, immediately
     due and payable, whereupon the same shall be due and payable.

          (b) TERMINATION OF OBLIGATION TO MAKE ADVANCE. Terminate any
     obligation of the Lender to lend under this Agreement in its entirety, or
     any portion of any such commitment, to the extent Lender shall deem
     appropriate, all without notice to Borrower.

          (c) JUDGMENT. Reduce Lender's claim to judgment, foreclose or
     otherwise enforce Lender's security interest in all or any part of the
     Collateral by any available judicial or other procedure under law.

          (d) SALE OF COLLATERAL. After notification, if any, provided for in
     Section 9.2 below, sell or otherwise dispose of, at the office of Lender,
     or elsewhere, as chosen by Lender, all or any part of the Collateral, and
     any such sale or other disposition may be as a unit or in parcels, by
     public or private proceedings, and by way of one or more contracts (it
     being agreed that the sale of any part of the Collateral shall not exhaust
     Lender's power of sale, but sales may be made from time to time until all
     of the Collateral has been sold or until the Obligations have been paid in
     full and fully performed), and at any such sale it shall not be necessary
     to exhibit the Collateral. Borrower hereby acknowledges and agrees that a
     private sale or sales of the Collateral, after notification as provided for
     in Section 9.2, shall constitute a commercially reasonable disposition of
     the Collateral sold at any such sale or sales, and otherwise, commercially
     reasonable action on the part of the Lender.

                                       54
<PAGE>   56

          (e) RETENTION OF COLLATERAL. At its discretion, retain such portion of
     the Collateral as shall aggregate in value to an amount equal to the
     aggregate amount of the Loans, in satisfaction of the Obligations, whenever
     the circumstances are such that Lender is entitled and elects to do so
     under applicable law.

          (f) RECEIVER. Apply by appropriate judicial proceedings for
     appointment of a receiver for the Collateral, or any part thereof, and
     Borrower hereby consents to any such appointment.

          (g) PURCHASE OF COLLATERAL. Buy the Collateral at any public or
     private sale.

          (h) EXERCISE OF OTHER RIGHTS. Lender shall have all the rights and
     remedies of a secured party under the Code and other legal and equitable
     rights to which it may be entitled. Lender may also exercise any and all
     other rights or remedies afforded by any other applicable laws or by the
     Loan Documents as Lender shall deem appropriate, at law, in equity or
     otherwise, including, but not limited to, the right to bring suit or other
     proceeding, either for specific performance of any covenant or condition
     contained in the Loan Documents or in aid of the exercise of any right or
     remedy granted to Lender in the Loan Documents. Lender shall also have the
     right to require the Borrower to assemble any of the Collateral not in
     Lender's possession, at Borrower's expense, and make it available to Lender
     at a place to be determined by Lender which is reasonably convenient to
     both parties, and Lender shall have the right to take immediate possession
     of all of the Collateral, and may enter the Resort or any of the premises
     of Borrower or wherever the Collateral shall be located, with or without
     process of law wherever the Collateral may be, and, to the extent such
     premises are not the property of Lender, to keep and store the same on said
     premises until sold (and if said premises be the property of Borrower,
     Borrower agrees not to charge Lender for use and occupancy, rent, or
     storage of the Collateral, for a period of at least ninety (90) days after
     sale or disposition of the Collateral).

     9.2 NOTICE OF SALE. Reasonable notification of time and place of any public
sale of the Collateral or reasonable notification of the time after which any
private sale or other intended disposition of the Collateral is to be made shall
be sent to Borrower and to any other person entitled under the Code to notice;
provided, however, that if the Collateral threatens to decline speedily in value
or is of a type customarily sold on a recognized market, Lender may sell or
otherwise dispose of the Collateral without notification, advertisement or other
notice of any kind. It is agreed that notice sent not less than five (5)
calendar days prior to the taking of the action to which such notice relates is
reasonable notification and notice for the purposes of this Section 9.2. Lender
shall have the right to bid at any public or private sale on its own behalf. Out
of money arising from any such

                                       55
<PAGE>   57

sale, Lender shall retain an amount equal to all of its costs and charges,
including attorneys' fees for advice, counsel or other legal services or for
pursuing, reclaiming, seeking to reclaim, taking, keeping, removing, storing and
advertising such Collateral for sale, selling same and any and all other charges
and expenses in connection therewith and in satisfying any prior Liens thereon.
Any balance shall be applied upon the Obligations, and in the event of
deficiency, the Borrower shall remain liable to the Lender. In the event of any
surplus, such surplus shall be paid to the Borrower or to such other Persons as
may be legally entitled to such surplus. If, by reason of any suit or proceeding
of any kind, nature or description against the Borrower, or by the Borrower or
any other party against Lender, which in Lender's sole discretion makes it
advisable for Lender to seek counsel for the protection and preservation of its
security interest, or to defend the interest of the Lender, such expenses and
counsel fees shall be allowed to Lender and the same shall be made a further
charge and Lien upon the Collateral.

          In view of the fact that federal and state securities laws may impose
certain restrictions on the methods by which a sale of Collateral comprised of
Securities may be effected after an Event of Default, Borrower agrees that upon
the occurrence or existence of an Event of Default, Lender may, from time to
time, attempt to sell all or any part of such Collateral by means of a private
placement restricting the bidding and prospective purchasers to whose who will
represent and agree that they are purchasing for investment only and not for, or
with a view to, distribution. In so doing, Lender may solicit offers to buy such
Collateral, or any part of it for cash, from a limited number of investors
deemed by Lender, in its reasonable judgment, to be responsible parties who
might be interested in purchasing the Collateral, and if Lender solicits such
offers from not less than two (2) such investors, then the acceptance by Lender
of the highest offer obtained therefrom shall be deemed to be a commercially
reasonable method of disposition of such Collateral.

     9.3 APPLICATION OF COLLATERAL; TERMINATION OF AGREEMENTS. Upon the
occurrence of any Event of Default: (i) Lender may, with or without proceeding
with such sale or foreclosure or demanding payment or performance of the
Obligations, without notice, terminate Lender's further performance under this
Agreement or any other agreement or agreements between Lender and the Borrower,
without further liability or obligation by Lender; (ii) Lender, at any time,
appropriate and apply on any Obligations any and all Collateral in its
possession and (iii) Lender may apply any and all balances, credits, deposits,
accounts, reserves, indebtedness or other moneys due or owing to the Borrower
held by Lender hereunder or under any other financing agreement or otherwise,
whether accrued or not. Neither such termination, nor the termination of this
Agreement by lapse of time, the giving of notice or otherwise, shall absolve,
release or otherwise affect the liability of the Borrower in respect of
transactions prior to such termination, or affect any of the Liens, security
interests, rights, powers and remedies of the Lender, but they shall, in all
events, continue until all of the Obligations are satisfied.

                                       56
<PAGE>   58

     9.4 RIGHTS OF LENDER REGARDING COLLATERAL. In addition to all other rights
possessed by the Lender, Lender, at its option, may on its behalf from time to
time after there shall have occurred an Event of Default, and so long as such
Event of Default remains uncured, at its sole discretion, take the following
actions:

          (a) Transfer all or any part of the Collateral into the name of Lender
     or its nominee;

          (b) Take control of any proceeds of any of the Collateral;

          (c) Extend or renew the Loan and grant releases, compromises or
     indulgences with respect to the Obligations, any portion thereof, any
     extension or renewal thereof, or any security therefor, to any obligor
     hereunder or thereunder; and

          (d) Exchange certificates or instruments representing or evidencing
     the Collateral for certificates or instruments of smaller or larger
     denominations for any purpose consistent with the terms of this Agreement.

     9.5 DELEGATION OF DUTIES AND RIGHTS. Lender may execute any of its duties
and/or exercise any of its rights or remedies under the Loan Documents by or
through its officers, directors, employees, attorneys, agents or other
representatives.

     9.6 LENDER NOT IN CONTROL. None of the covenants or other provisions
contained in this Agreement or in any Loan Document shall give Lender the right
or power to exercise control over the affairs and/or management of Borrower.

     9.7 WAIVERS. The acceptance by Lender at any time and from time to time of
partial payments of the Loan or performance of the Obligations shall not be
deemed to be a waiver of any Event of Default then existing. No waiver by Lender
of any Event of Default shall be deemed to be a waiver of any other or
subsequent Event of Default. No delay or omission by Lender in exercising any
right or remedy under the Loan Documents shall impair such right or remedy or be
construed as a waiver thereof or an acquiescence therein, nor shall any single
or partial exercise of any such right or remedy preclude other or further
exercise thereof, or the exercise of any other right or remedy under the Loan
Documents or otherwise. Further, except as otherwise expressly provided in this
Agreement or by applicable law, Borrower and each and every surety, endorser,
guarantor and other party liable for the payment or performance of all or any
portion of the Obligations, severally waive notice of the occurrence of any
Event of Default, presentment and demand for payment, protest, and notice of
protest, notice of intention to accelerate, acceleration and nonpayment, and
agree that their liability shall not be affected by any renewal or extension in

                                       57
<PAGE>   59

the time of payment of the Loan, or by any release or change in any security for
the payment or performance of the Loan, regardless of the number of such
renewals, extensions, releases or changes.

     9.8 CUMULATIVE RIGHTS. All rights and remedies available to the Lender
under the Loan Documents shall be cumulative of and in addition to all other
rights and remedies granted to Lender under any of the Loan Document, at law or
in equity, whether or not the Loan is due and payable and whether or not Lender
shall have instituted any suit for collection or other action in connection with
the Loan Documents.

     9.9 EXPENDITURES BY LENDER. Any sums expended by or on behalf of Lender
pursuant to the exercise of any right or remedy provided herein shall become
part of the Obligations and shall bear interest at the Default Rate, from the
date of such expenditure until the date repaid.

     9.10 DIMINUTION IN VALUE OF COLLATERAL. Lender shall not have any liability
or responsibility whatsoever for any diminution or loss in value of any of the
Collateral, specifically including that which may arise from Lender's negligence
or inadvertence, whether such negligence or inadvertence is the sole or
concurring cause of any damage.

     9.11 LENDER'S KNOWLEDGE. The Lender shall not be deemed to have knowledge
or notice of the occurrence of any Event of Default unless the Lender has actual
knowledge of the Event of Default or has received a notice the Borrower
referring to this Agreement and describing such Event of Default.

                     SECTION 10 -- CERTAIN RIGHTS OF LENDER

     10.1 PROTECTION OF COLLATERAL. Lender may at any time and from time to time
take such actions as Lender deems necessary or appropriate to protect the
Lender's Liens and security interests in and to preserve the Collateral, and to
establish, maintain and protect the enforceability of Lender's rights with
respect thereto, all at the expense of Borrower. Borrower agrees to cooperate
fully with all of Lender's efforts to preserve the Collateral and Lender's
Liens, security interests and rights and will take such actions to preserve the
Collateral and Lender's Liens, security interests and rights as Lender may
direct, including, without limitation, by promptly paying upon Lender's demand
therefor, all documentary stamp taxes or other taxes that may be or may become
due in respect of any of the Collateral. All of Lender's expenses of preserving
the Collateral and Lender's liens and security interests and rights therein
shall be added to the Loan.

     10.2 PERFORMANCE BY LENDER. If Borrower fails to perform any agreement
contained herein, Lender may itself perform, or cause the performance of, such
agreement, and the expenses of Lender incurred in connection therewith shall be
payable by Borrower under Section 10.5 below.

                                       58
<PAGE>   60

In no event, however, shall Lender have any obligation or duties whatsoever to
perform any covenant or agreement of Borrower contained herein or in any of the
Loan Documents, Timeshare Documents or Operating Contracts, and any such
performance by Lender shall be wholly discretionary with Lender. The performance
by Lender, of any agreement or covenant of Borrower on any occasion shall not
give rise to any duty on the part of Lender to perform any such agreements or
covenants on any other occasion or at any time. In addition, Borrower
acknowledges that Lender shall not at any time or under any circumstances
whatsoever have any duty to Borrower or to any third party to exercise any of
Lender's rights or remedies hereunder.

     10.3 NO LIABILITY OF LENDER. Neither the acceptance of this Agreement by
Lender, nor the exercise of any rights hereunder by Lender, shall be construed
in any way as an assumption by Lender of any obligations, responsibilities or
duties of Borrower arising in connection with any Resort or under the Timeshare
Documents or Timeshare Acts, or under any of the Operating Contracts, or in
connection with any other business of Borrower, or the Collateral, or otherwise
bind Lender to the performance of any obligations with respect to any Resort or
the Collateral; it being expressly understood that Lender shall not be obligated
to perform, observe or discharge any obligation, responsibility, duty, or
liability of Borrower with respect to any Resort or any of the Collateral, or
under any of the Timeshare Documents, the Timeshare Acts or under any of the
Operating Contracts, including, but not limited to, appearing in or defending
any action, expending any money or incurring any expense in connection
therewith. Without limitation of the foregoing, neither this Agreement, any
action or actions on the part of Lender taken hereunder, prior to or following
the occurrence of an Event of Default shall constitute an assumption by Lender
of any obligations of Borrower with respect to any Resort or any documents or
instruments executed in connection therewith, and Borrower shall continue to be
liable for all of its obligations thereunder or with respect thereto. Borrower
agrees to indemnify, protect, defend and hold Lender harmless from and against
any and all claims, demands, causes of action, losses, damages, liabilities,
suits, costs and expenses, including, without limitation, attorneys' fees and
court costs, asserted against or incurred by Lender by reason of, arising out
of, or connected in any way with (i) any failure or alleged failure of Borrower
to perform any of its covenants or obligations with respect to each Resort or to
the Purchasers of any of the Intervals, (ii) a breach of any certification,
representation, warranty or covenant of Borrower set forth in any of the Loan
Documents, (iii) the ownership of the Inventory and the rights, titles and
interests assigned hereby, or intended so to be, (iv) the debtor-creditor
relationships between Borrower on the one hand, and the Lender, on the other, or
(v) the operation of the Resorts or sale of Intervals. The obligations of
Borrower to indemnify, protect, defend and hold Lender harmless as provided in
this Agreement are absolute, unconditional, present and continuing, and shall
not be dependent upon or affected by the genuineness, validity, regularity or
enforceability of any claim, demand or suit from which Lender is indemnified.
The indemnity provisions in this Section 10.3 shall survive the satisfaction of
the Obligations and termination of this Agreement, and remain binding and
enforceable against the Borrower, or its successors or assigns. Borrower hereby
waives all notices with respect to any losses, damages, liabilities, suits,

                                       59
<PAGE>   61

costs and expenses, and all other demands whatsoever hereby indemnified, and
agrees that its obligations under this Agreement shall not be affected by any
circumstances, whether or not referred to above, which might otherwise
constitute legal or equitable discharges of its obligations hereunder.

     10.4 RIGHT TO DEFEND ACTION AFFECTING SECURITY. Lender may, at Borrower's
expense, appear in and defend any action or proceeding at law or in equity which
Lender in good faith believes may affect the security interests granted under
this Agreement, including without limitation, with respect to the value of the
Collateral or Lender's rights under any of the Loan Documents.

     10.5 EXPENSES. All expenses payable by Borrower, under any provision of
this Agreement shall be an Obligation of the Borrower and shall be paid by
Borrower to Lender, upon demand, and shall bear interest at the Default Rate
from the date of expense until repaid by Borrower.

     10.6 LENDER'S RIGHT OF SET-OFF. Lender shall have the right to set-off
against any Collateral any Obligations then due and unpaid by Borrower.

     10.7 NO WAIVER. No failure or delay on the part of Lender in exercising any
right, remedy or power under this Agreement or in giving or insisting upon
strict performance by Borrower hereunder or in giving notice hereunder shall
operate as a waiver of the same or any other power or right, and no single or
partial exercise of any such power or right shall preclude any other or further
exercise thereof or the exercise of any other such power or right. Lender,
notwithstanding any such failure, shall have the right thereafter to insist upon
the strict performance by Borrower of any and all of the terms and provisions of
this Agreement to be performed by Borrower. The collection and application of
proceeds, the entering and taking possession of the Collateral, and the exercise
by Lender of its rights contained in the Loan Documents and this Agreement shall
not cure or waive any default, or affect any notice of default, or invalidate
any acts done pursuant to such notice. No waiver by Lender of any breach or
default of or by any party hereunder shall be deemed to alter or affect Lender's
rights hereunder with respect to any prior or subsequent default.

     10.8 RIGHT OF LENDER TO EXTEND TIME OF PAYMENT, SUBSTITUTE, RELEASE
SECURITY, ETC. Without affecting the liability of any Person or entity including
without limitation, for the payment of any of the Obligations or without
affecting or impairing Lender's Lien on the Collateral, or the remainder
thereof, as security for the full amount of the Loan unpaid and the Obligations,
Lender may from time to time, without notice: (a) release any Person liable for
the payment of the Loan, (b) extend the time or otherwise alter the terms of
payment of the Loan, (c) accept additional security for the Obligations of any
kind, including deeds of trust or mortgages and security agreements, (d) alter,
substitute or release any property securing the Obligations, (e) realize upon

                                       60
<PAGE>   62

any collateral for the payment of all or any portion of the Loan in such order
and manner as it may deem fit, or (f) join in any subordination or other
agreement affecting this Agreement or the lien or charge thereof.

     10.9 ASSIGNMENT OF LENDER'S INTEREST. Lender shall have the right to assign
the Loan and all or any portion of its rights in or pursuant to this Agreement
or any of the Loan Documents to any subsequent holder or holders of the Note or
the Obligations evidenced thereby.

     10.10 POWER OF ATTORNEY. Borrower does hereby irrevocably constitute and
appoint Lender as Borrower's true and lawful agent and attorney-in-fact, with
full power of substitution, for Borrower and in Borrower's name, place and
stead, or otherwise, to (a) endorse any checks or drafts payable to Borrower in
the name of Borrower and in favor of Lender, (b) to demand and receive from time
to time any and all property, rights, titles, interests and liens hereby sold,
assigned and transferred, or intended so to be, and to give receipts for same,
(c) from time to time to institute and prosecute in Lender's own name any and
all proceedings at law, in equity, or otherwise, that Lender may deem proper in
order to collect, assert or enforce any claim, right or title, of any kind, in
and to the property, rights, titles, interests and liens hereby sold, assigned
or transferred, or intended so to be, and to defend and compromise any and all
actions, suits or proceedings in respect of any of the said property, rights,
titles, interests and liens, (d) upon an Event of Default to change the
Borrower's post office mailing address, and (e) generally to do all and any such
acts and things in relation to the Collateral as Lender shall in good faith deem
advisable. Borrower hereby declares that the appointment made and the powers
granted pursuant to this Section 10.10 are coupled with an interest and are and
shall be irrevocable by Borrower in any manner, or for any reason, unless and
until a release of the same is executed by Lender and duly recorded in the
appropriate public records of Dallas County, Texas.

     10.11 RELIEF FROM AUTOMATIC STAY, ETC. To the fullest extent permitted by
law, in the event the Borrower shall make application for or seek relief or
protection under the federal bankruptcy code ("Bankruptcy Code") or other Debtor
Relief Laws, or in the event that any involuntary petition is filed against the
Borrower under such Code or other Debtor Relief Laws, and not dismissed with
prejudice within 45 days, the automatic stay provisions of Section 362 of the
Bankruptcy Code are hereby modified as to Lender to the extent necessary to
implement the provisions hereof permitting set-off and the filing of financing
statements or other instruments or documents; and Lender shall automatically and
without demand or notice (each of which is hereby waived) be entitled to
immediate relief from any automatic stay imposed by Section 362 of the
Bankruptcy Code or otherwise, on or against the exercise of the rights and
remedies otherwise available to the Lender as provided in the Loan Documents.

                                       61
<PAGE>   63

                         SECTION 11 -- TERM OF AGREEMENT

     This Agreement shall continue in full force and effect and the security
interests granted hereby and the duties, covenants and liabilities of the
Borrower hereunder and all the terms, conditions and provisions hereof relating
thereto shall continue to be fully operative until all of the Obligations have
been satisfied in full. The Borrower expressly agrees that if the Borrower makes
a payment to Lender, which payment or any part thereof is subsequently
invalidated, declared to be fraudulent or preferential, or otherwise required to
be repaid to a trustee, receiver or any other party under any Debtor Relief
Laws, state or federal law, common law or equitable cause, then to the extent of
such repayment, the Obligations or any part thereof intended to be satisfied and
the Liens provided for hereunder securing the same shall be revived and
continued in full force and effect as if said payment had not been made.

                           SECTION 12 -- MISCELLANEOUS

     12.1 NOTICES. All notices, requests and other communications to either
party hereunder shall be in writing and shall be given to such party at its
address set forth below or at such other address as such party may hereafter
specify for the purpose of notice to Lender or Borrower. Each such notice,
request or other communication shall be effective (a) if given by mail, when
such notice is deposited in the United States Mail with first class postage
prepaid, addressed as aforesaid, provided that such mailing is by registered or
certified mail, return receipt requested, (b) if given by overnight delivery,
when deposited with a nationally recognized overnight delivery service such as
Federal Express or Airborne with all fees and charges prepaid, addressed as
provided below, or (c) if given by any other means, when delivered at the
address specified in this Section 12.1.

         IF TO BORROWER:   Silverleaf Resorts, Inc.
                           1221 Riverbend Drive, Suite 120
                           Dallas, TX 75221
                           Attn: Mr. Robert Mead, CEO

         WITH A COPY TO:   Meadows, Owens, Collier, Reed, Cousins and Blau
                           3700 Nations Bank Plaza
                           901 Main St.
                           Dallas, TX 75202
                           Attn: George R. Bedell, Esq.

         IF TO LENDER:     Textron Financial Corporation
                           40 Westminster Street
                           Providence, Rhode Island 02903
                           Attention:  Collections

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<PAGE>   64

         WITH A COPY TO:   Textron Financial Corporation
                           P.O. Box 6687
                           Providence, Rhode Island 02940-6687
                           Attention:  Division Counsel (RRD)

         AND TO:           Textron Financial Corporation
                           333 East River Drive, Suite 305
                           East Hartford, Connecticut 06108
                           Attn:  Division Manager

     Notwithstanding the foregoing, copies of the requests or notices from
Borrower to Lender which are specified in the Sections of this Agreement listed
below shall not be delivered to Providence, Rhode Island as provided above, but
rather shall be delivered in accordance with this Section 12.1 to Textron
Financial Corporation, 333 East River Drive, Suite 305, East Hartford,
Connecticut 06108, Attention: Nicholas L. Mecca, Vice President. The applicable
Sections of this Agreement are Section 2.4(a) Voluntary Prepayments and Section
5(a) Request for Advances. In addition, all documents, instruments and other
items to be delivered to the Lender from time to time pursuant to this Agreement
shall be delivered to Lender's office at 333 East River Drive, Suite 305, East
Hartford, Connecticut 06108.

     12.2 SURVIVAL. All representations, warranties, covenants and agreements
made by Borrower herein, in the other Loan Documents or in any other agreement,
document, instrument or certificate delivered by or on behalf of Borrower under
or pursuant to the Loan Documents shall be considered to have been relied upon
by Lender and shall survive the delivery to Lender of such Loan Documents (and
each part thereof), regardless of any investigation made by or on behalf of
Lender.

     12.3 GOVERNING LAW. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (EXCEPT AS
MAY BE EXPRESSLY PROVIDED THEREIN TO THE CONTRARY) SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF RHODE ISLAND, EXCLUSIVE OF
ITS CHOICE OF LAWS PRINCIPLES.

     12.4 LIMITATION ON INTEREST. Lender and Borrower intend to comply at all
times with applicable usury laws. All agreements between the Lender and
Borrower, whether now existing or hereafter arising and whether written or oral,
are hereby limited so that in no contingency, whether by reason of demand or
acceleration of the maturity of the Note or otherwise, shall the interest
contracted for, charged, received, paid or agreed to be paid to Lender exceed
the highest lawful rate permissible under applicable usury laws. If, from any
circumstance whatsoever fulfillment of any provision hereof, of the Note or of
any other Loan Documents shall involve transcending the limit

                                       63
<PAGE>   65

of such validity prescribed by any law which a Court of Competent jurisdiction
may deem applicable hereto, then ipso facto, the obligation to be fulfilled
shall be reduced to the limit of such validity; and if from any circumstance
Lender shall ever receive anything of value deemed interest by applicable law
which would exceed the highest lawful rate, such amount which would be excessive
interest shall be applied to the reduction of the principal of the Loan and not
to the payment of interest, or if such excessive interest exceeds the unpaid
balance of principal of the Loan, such excess shall be refunded to Borrower. All
interest paid or agreed to be paid to the Lender shall, to the extent permitted
by applicable law, be amortized, prorated, allocated and spread throughout the
full period until payment in full of the principal so that the interest on the
Loan for such full period shall not exceed the highest lawful rate. Borrower
agrees that in determining whether or not any interest payment under the Loan
Documents exceeds the highest lawful rate, any non-principal payment (except
payments specifically described in the Loan Documents as "interest") including
without limitation, prepayment fees and late charges, shall to the maximum
extent not prohibited by law, be an expense, fee, premium or penalty rather than
interest. Lender hereby expressly disclaims any intent to contract for, charge
or receive interest in an amount which exceeds the highest lawful rate. The
provisions of the Note, this Agreement, and all other Loan Documents are hereby
modified to the extent necessary to conform with the limitations and provisions
of this Section, and this Section shall govern over all other provisions in any
document or agreement now or hereafter existing. This Section shall never be
superseded or waived unless there is a written document executed by Lender and
the Borrower, expressly declaring the usury limitation of this Agreement to be
null and void, and no other method or language shall be effective to supersede
or waive this paragraph.

     12.5 INVALID PROVISIONS. If any provision of this Agreement or any of the
other Loan Documents is held to be illegal, invalid or unenforceable under
present or future laws effective during the term thereof, such provision shall
be fully severable, this Agreement and the other Loan Documents shall be
construed and enforced as if such illegal, invalid or unenforceable provision
had never comprised a part hereof or thereof, and the remaining provisions
hereof or thereof shall remain in full force and effect and shall not be
affected by the illegal, invalid or unenforceable provision or by its severance
therefrom. Furthermore, in lieu of such illegal, invalid or unenforceable
provision there shall be added automatically as a part of this Agreement and/or
the Loan Documents (as the case may be) a provision as similar in terms to such
illegal, invalid or unenforceable provision as may be possible and be legal,
valid and enforceable.

     12.6 SUCCESSORS AND ASSIGNS. This Agreement and the other Loan Documents
shall be binding upon and inure to the benefit of Borrower and Lender and their
respective successors and assigns; provided that Borrower may not transfer or
assign any of its rights or obligations under this Agreement, or the other Loan
Documents without the prior written consent of Lender. This Agreement and the
transactions provided for or contemplated hereunder or under any of the Loan
Documents are intended solely for the benefit of the parties hereto. No third
party shall have any

                                       64
<PAGE>   66

rights or derive any benefits under or with respect to this Agreement, or the
other Loan Documents except as provided in advance in a writing signed on behalf
of Lender.

     12.7 AMENDMENT. This Agreement may not be amended or modified, and no term
or provision hereof may be waived, except by written instrument signed by the
Borrower and the Lender.

     12.8 COUNTERPARTS; EFFECTIVENESS. This Agreement may be signed in any
number of counterparts, each of which shall be an original, with the same effect
as if the signature thereto and hereto were on the same instrument. This
Agreement shall become effective upon Lender's receipt of one or more
counterparts hereof signed by Borrower.

     12.9 LENDER NOT FIDUCIARY. The relationship between Borrower, and Lender is
solely that of debtor and creditor, and Lender has no fiduciary or other special
relationship with Borrower, and no term or provision of any of the Loan
Documents shall be construed so as to deem the relationship between Borrower and
Lender to be other than that of debtor and creditor.

     12.10 ACCOUNTING PRINCIPLES. Where the character or amount of any asset or
liability or item of income or expense is required to be determined or any
consolidation or other accounting computation is required to be made for the
purposes of this Agreement, the same shall be determined or made in accordance
with GAAP consistently applied at the time in effect, to the extent applicable,
except where such principles are inconsistent with the requirements of this
Agreement.

     12.11 TOTAL AGREEMENT. This Agreement and the other Loan Documents,
including the Exhibits and Schedules to them, is the entire agreement between
the parties relating to the subject matter hereof, incorporates or rescinds all
prior agreements and understandings between the parties hereto relating to the
subject matter hereof, cannot be changed or terminated orally or by course of
conduct, and shall be deemed effective as of the date it is accepted by the
Lender at the offices set forth above.

     12.12 LITIGATION. TO THE FULLEST EXTENT NOT PROHIBITED BY APPLICABLE LAW
WHICH CANNOT BE WAIVED, THE BORROWER AND LENDER HEREBY KNOWINGLY, VOLUNTARILY,
INTENTIONALLY AND IRREVOCABLY WAIVES ANY AND ALL RIGHT TO A TRIAL BY JURY IN ANY
ACTION OR PROCEEDING TO ENFORCE OR DEFEND OR CLARIFY ANY RIGHT, POWER, REMEDY OR
DEFENSE ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS,
OR THE TRANSACTIONS CONTEMPLATED HEREIN OR THEREIN, WHETHER SOUNDING IN TORT OR
CONTRACT OR OTHERWISE, OR WITH RESPECT TO ANY COURSE OF CONDUCT,

                                       65
<PAGE>   67

COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY
PARTY; AND EACH AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE
A JUDGE AND NOT BEFORE A JURY. EACH OF THE BORROWER AND LENDER FURTHER WAIVES
ANY RIGHT TO SEEK TO CONSOLIDATE ANY SUCH LITIGATION IN WHICH A JURY TRIAL HAS
BEEN WAIVED WITH ANY OTHER LITIGATION IN WHICH A JURY TRIAL CANNOT OR HAS NOT
BEEN WAIVED. FURTHER, THE BORROWER HEREBY CERTIFIES THAT NO REPRESENTATIVE OR
AGENT OF LENDER, NOR LENDER'S COUNSEL HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT LENDER WOULD NOT, IN THE EVENT OF SUCH LITIGATION, SEEK TO ENFORCE THIS
WAIVER OF RIGHT TO JURY TRIAL PROVISION. THE BORROWER ACKNOWLEDGES THAT THE
PROVISIONS OF THIS SECTION ARE A MATERIAL INDUCEMENT TO LENDER'S ACCEPTANCE OF
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.

          The waiver and stipulations of the Borrower and Lender in this Section
12.12 shall survive the final payment or performance of all of the Obligations
of the Borrower and the resulting termination of this Agreement.

     12.13 INCORPORATION OF EXHIBITS. This Agreement, together with all Exhibits
and Schedules hereto, constitute one document and agreement which is referred to
herein by the use of the defined term "Agreement." Such Exhibits and Schedules
are incorporated herein as to fully set out in this Agreement. The definitions
contained in any part of this Agreement shall apply to all parts of this
Agreement.

     12.14 CONSENT TO ADVERTISING AND PUBLICITY OF TIMESHARE DOCUMENTS. The
Borrower hereby consents that Lender may issue and disseminate to the public
information describing the credit accommodation entered into pursuant to this
Agreement, including the names and addresses of Borrower and any subsidiaries
and Affiliates, the amount and a general description of the Borrower's business.

     12.15 DIRECTLY OR INDIRECTLY. Where any provision in the Agreement refers
to action to be taken by any Person, or which such Person is prohibited from
taking, such provisions shall be applicable whether such action is taken
directly or indirectly by such Person.

     12.16 HEADINGS. Section headings have been inserted in the Agreement as a
matter of convenience of reference only; such section headings are not a part of
the Agreement and shall not be used in the interpretation of this Agreement.

                                       66
<PAGE>   68

     12.17 GENDER AND NUMBER. Words of any gender in this Agreement shall
include each other gender and the singular shall mean the plural and vice versa
where appropriate.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

                                       67
<PAGE>   69

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

                                            BORROWER:

                                            SILVERLEAF RESORTS, INC., a Texas
                                            corporation

 /s/ GEORGE R. BEDELL                       By:  /s/ ROBERT E. MEAD
---------------------------------               --------------------------------
                                            Name: Robert E. Mead
                                            Title: Chief Executive Officer

                                            LENDER:

                                            TEXTRON FINANCIAL CORPORATION,
                                            a Delaware corporation

 /s/ [ILLEGIBLE]                            By: /s/ JOHN T. D'ANNEBALE
---------------------------------               --------------------------------
                                            Name: John T. D'Annebale
                                            Title: AVP

                                       68
<PAGE>   70

STATE OF TEXAS       )
                     )        ss:
COUNTY OF DALLAS     )

     The foregoing instrument was acknowledged before me this 8th day of
December, 1999 by Robert E. Mead, Chief Executive Officer of Silverleaf Resorts,
Inc., a Texas corporation, on behalf of the Corporation.

                                            /s/ SANDRA CEARLEY
                                            ------------------------------------
                                            Notary Public
                                            My Commission Expires: 12-28-2002

                                                                         [SEAL]

STATE OF CONNECTICUT       )
                           )    ss:
COUNTY OF HARTFORD         )

     The foregoing instrument was acknowledged before me this 16th day of
December, 1999 by John T. D'Annebale, AVP of TEXTRON FINANCIAL CORPORATION, a
Delaware corporation, on behalf of the corporation.

                                           /s/ CHRISTINE M. CORDEIRA
                                           --------------------------------
                                           Commissioner of the Superior Court
                                           Notary Public
                                           My Commission Expires: April 30, 2002

                                       69

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