Document:

Exhibit 10.(p)

                               LENNAR CORPORATION

                   2000 STOCK OPTION AND RESTRICTED STOCK PLAN

1. Purpose of the Plan

         The Purpose of the Plan is to encourage and enable those officers,
employees and directors of the Company upon whose judgement, initiative and
efforts the Company largely depends for the successful conduct of its business
to acquire a proprietary interest in Lennar, and by doing so to stimulate the
efforts of those officers, employees and directors on behalf of the Company and
strengthen their desire to remain officers, employees or directors of the
Company. The Plan is an amendment and complete restatement of the 1997 Stock
Option Plan and provides, in addition to the granting of stock options, for the
granting of Restricted Stock.

2. Definitions

         As used in this Plan the following definitions apply:

                  (a) "Assumed Options" means options granted in connection with
         the spinoff of LNR from Lennar Corporation in substitution for
         unexercised options granted under the Lennar Corporation 1991 Stock
         Option Plan or otherwise.

                  (b) "Board of Directors" means the Board of Directors of
         Lennar.

                  (c) "Code" means the Internal Revenue Code of 1986, as
         amended.

                  (d) "Committee" means the Compensation Committee of the Board
         of Directors, or such other committee of the Board of Directors as is
         specified by the Board of Directors to perform the functions and duties
         of the Committee under the Plan. If there is no Compensation Committee
         and the Board of Directors does not appoint another Committee, the
         Board of Directors will be the Committee.

                  (e) "Common Stock" means common stock, par value $.10 per
         share, of Lennar.

                  (f) "Company" means Lennar and all of its more than 50% owned
         subsidiaries.

                  (g) "Director" means any person serving as a member of the
         board of directors of any corporation included in the Company.

                  (h) "Discretion" means the ability of a committee or other
         body to act in its sole discretion, with no requirement that it follow
         past practices or treat one employee in a manner consistent with the
         treatment afforded to any other employee.

                  (i) "Grantee" means a person who holds a stock option, Stock
         Appreciation Right or Restricted Stock granted under the Plan.

                  (j) "Incentive Option" means an option to purchase Common
         Stock which meets the requirements set forth in the Plan and is
         intended to be, and qualifies as, an Incentive Stock Option as that
         term is used in Section 422 of the Code.

                  (k) "Key Employee" means an officer or employee of the
         Company, who the Committee determines can contribute significantly to
         the growth and successful operations of the Company.

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                  (l) "Lennar Equivalent Fraction" means a fraction of which (i)
         the numerator is the average of the closing prices of Lennar
         Corporation common stock, as reported on the New York Stock Exchange on
         October 27, 28, 29, 30 and 31, 1997 and (ii) the denominator is the
         average of the closing prices of Lennar Common Stock, as reported on
         the New York Stock Exchange on November 3, 4, 5, 6 and 7, 1997.

                  (m) "Lennar Options" means options granted under the Lennar
         1991 Stock Option Plan, as it may have been amended and restated from
         time to time, which were outstanding (whether or not they were
         immediately exercisable) on October 31, 1997.

                  (n) "Lennar" means Lennar Corporation, a Delaware corporation,
         or its successor by merger or any similar transaction.

                  (o) "Nonqualified Option" means an option to purchase Common
         Stock which meets the requirements set forth in the Plan but is not
         intended to be, or does not qualify as, an Incentive Stock Option as
         that term is used in Section 422 of the Code.

                  (p) "Officers and Directors Stock Option Committee" means a
         committee designated by the Board of Directors, consisting of two or
         more persons all of whom are outside directors, as that term is used in
         Section 162(m) of the Code.

                  (q) "Plan" means this Lennar Corporation 2000 Stock Option and
         Restricted Stock Plan.

                  (r) "Restricted Stock" means Common Stock granted under the
         terms of the Plan, which are subject to the restrictions hereunder.

                  (s) "Securities Act" means the Securities Act of 1933, as
         amended.

                  (t) "Stock Appreciation Right" means a right to receive the
         appreciation in value, or a portion of the appreciation value, of a
         specified number of shares of Common Stock, as provided in Section
         4(b).

                  (u) "10% Stockholder" means a person who owns (after applying
         the attribution rules contained in Section 424 of the Code) more than
         10% of the total combined voting stock of all classes of Lennar or of
         any parent or subsidiary.

3. Authority to Grant Stock Options

         (a) The Committee or the Officers and Directors Stock Option Committee
may at any time authorize the grant of stock options under the Plan to any one
or more Key Employees or Directors. Subject to adjustment pursuant to Section
13, in no event may any Grantee receive stock options for more than 750,000
shares of Common Stock in any fiscal year. The Committee or the Officers and
Directors Stock Option Committee may at their discretion, grant Assumed Options
to Grantees that are intended to replace those unexercised stock options granted
by Lennar under its 1991 Stock Option Plan; it is intended that such replacement
would comply with Section 424 of the Code. An Assumed Option issued in
substitution for a Lennar Option will entitle the holder to purchase a number of
shares of Common Stock equal to (i) the number of shares which were subject to
the Lennar Option on October 31, 1997, times (ii) the Lennar Equivalent
Fraction. Stock options granted under the Plan may be Incentive Options or
Nonqualified Options, except that (i) no officer or Director who is not an
employee may be granted an Incentive Option, and (ii) no employee may be granted
an Incentive Option which would result in the aggregate fair market value,
determined as of the date the stock option is granted, of the Common Stock with
respect to which that Incentive Option and all other Incentive Options held by
that employee under any plan maintained by Lennar (or any parent or subsidiary
of Lennar) are exercisable for the first time by that employee during any
calendar year exceeding $100,000. Each stock option will be designated at the
time of grant as a Nonqualified Option or as an Incentive Option.

         (b) Without limiting the generality of what is stated in Section 3(a),
stock options may be granted to a Key Employee regardless of the fact that stock
options or Stock Appreciation Rights previously granted to that Key Employee
remain unexercised, and a Grantee may exercise a stock option or Stock
Appreciation Right when it is

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exercisable by its own terms, notwithstanding that there are stock options and
Stock Appreciation Rights which were previously granted to that Grantee which
remain unexercised.

4. Authority to Grant Stock Appreciation Rights

         (a) The Committee or the Officers and Directors Stock Option Committee
may at any time authorize the grant of Stock Appreciation Rights to any Key
Employees or Directors who hold or are receiving stock options granted under the
Plan. Each Stock Appreciation Right will relate to a specific stock option
granted under the Plan. A Stock Appreciation Right may be granted concurrently
with the stock option to which it relates or at any time after the stock option
has been granted and before it has been exercised, terminates or expires. The
number of shares subject to a Stock Appreciation Right may not exceed the number
of shares, which may be issued on exercise of the option to which the Stock
Appreciation Right relates.

         (b) The term "Stock Appreciation Right" means the right to receive from
the Company, without payment by the Grantee, an amount equal to the excess of
the fair market value on the date the Stock Appreciation Right is exercised of
the number of shares of Common Stock for which the Stock Appreciation Right is
exercised over the exercise price the Grantee would have had to pay to exercise
the related stock option in order to purchase that number of shares of Common
Stock. Upon exercise of a Stock Appreciation Right the Participant will
automatically be deemed to surrender the related stock option with regard to the
number of shares of Common Stock as to which the Stock Appreciation Right is
exercised. Stock Appreciation Rights may specify that the sum to be paid upon
their exercise may be paid by the Company in cash, in Common Stock valued at its
fair market value on the date the Stock Appreciation Right is exercised, or in
any combination of cash and Common Stock valued in that manner.

         (c) A Stock Appreciation Right granted under the Plan will be
exercisable only when, and with regard to the number of shares of Common Stock
as to which, the related stock option is exercisable and will lapse when the
related stock option terminates or expires. A Stock Appreciation Right granted
under the Plan may only be transferred when, and to the person, to whom the
right to exercise the related stock option is transferred as provided in Section
15.

5. Authority to Grant Restricted Stock

         The Committee or the Officers and Directors Stock Option Committee may
in its discretion, as reflected by the terms of the applicable award agreement,
at any time (i) authorize the grant of Restricted Stock under the Plan to any
one or more Key Employees or Directors; (ii) provide a specified purchase price
for the Restricted Stock (whether or not the payment of a purchase price is
required by any state law applicable to the Company); (iii) determine the
restrictions applicable to Restricted Stock and (iv) determine or impose other
conditions to the grant of Restricted Stock under the Plan as it may deem
appropriate. However, the aggregate number of shares of Restricted Stock granted
to a Key Employee or Director in any fiscal year shall not exceed 750,000.

6. Terms and Conditions of Stock Options

         (a) Expiration Date: Each stock option granted under the Plan, other
than an Assumed Option, will expire on a date determined by the Committee or the
Officers and Directors Stock Option Committee, in its Discretion, when the
option is granted, which will be not more than 10 years after the date of grant,
except that an Incentive Option granted to a Key Employee who, at the time of
the grant, is a 10% Stockholder will expire not more than five years after the
date of grant.

         (b) Exercise Date:

                  (i) Each stock option granted under the Plan, other than an
         Assumed Option, will be exercisable at such time or times, and in such
         installments, as are determined by the Committee or the Officers and
         Directors Stock Option Committee, in its Discretion, when the stock
         option is granted. In the case of new Assumed Options granted to a
         Grantee in replacement in accordance with Section 424 of the Code for
         options held by the Grantee, the new options may be made exercisable,
         if so determined by the Committee or the Officers and Directors Stock
         Option Committee, in its discretion, at the earliest date the replaced
         options were available.

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                  (ii) Each Assumed Option issued in substitution for a Lennar
         Option will be exercisable with regard to (x) the number of shares as
         to which the Lennar Option would have been exercisable, multiplied by
         (y) the Lennar Equivalent Fraction.

         (c) Price:

                  (i) The exercise price of each stock option granted under the
         Plan, other than an Assumed Option, will be determined by the Committee
         or the Officers and Directors Stock Option Committee, in its
         Discretion, at the time the stock option is granted, except that the
         exercise price of a stock option may not be less than (i) if the stock
         option is an Incentive Option granted to a person who is not a 10%
         Stockholder, 100% of the fair market value of the Common Stock on the
         date the stock option is granted or (ii) if the stock option is an
         Incentive Option granted to a 10% Stockholder, 110% of the fair market
         value of the Common Stock on the date the stock option is granted. If
         the stock option is a Nonqualified Option, the option may be granted at
         any price determined by the appropriate committee, except that a stock
         option intended to qualify for an exception under Section 162(m) of the
         Code, shall have an exercise price of not less than 100% of the fair
         market value of the Common Stock on the date the stock option is
         granted. For the purposes of the Plan, the fair market value of a share
         of the Common Stock on any day will be the mean between the highest and
         lowest quoted selling prices of the Common Stock on the New York Stock
         Exchange (or, if the Common Stock is not traded on the New York Stock
         Exchange, on the principal securities exchange or market on which the
         Common Stock is traded) on that date, or if there are no sales on that
         date, on the next following day on which there are sales. In the event
         the Common Stock is not publicly traded as of the date the option is
         granted, the exercise price of each such Incentive Option granted under
         the Plan will be determined by the Committee or the Officers and
         Directors Stock Option Committee, in its Discretion, at the time the
         Incentive Option is granted, except that the exercise price of the
         Incentive Option may not be less than the fair market value of such
         shares as of the grant date, with such fair market value determination
         to be made in 'good faith' as prescribed in Section 14a.422A-1 Q&A
         2(c)(4) of the Temporary Treasury Regulations.

                  (ii) The per share exercise price of an Assumed Option issued
         in substitution for a Lennar Option will be (x) the per share exercise
         price of the Lennar Option on October 31, 1997, divided by (y) the
         Lennar Equivalent Fraction.

         (d) Assignment: No stock option granted under the Plan may be assigned
or transferred, other than as provided in Section 15 upon the death of the
Grantee to whom the stock option was granted; provided, however, that the
Committee or the Officers and Directors Stock Option Committee, may (but need
not) permit other transfers, where the Committee or the Officers and Directors
Stock Option Committee concludes that such transferability (i) does not result
in accelerated taxation, (ii) does not cause any option intended to be an
Incentive Option to fail to meet the requirements set forth in Section 422(b) of
the Code (or any applicable successor to that Section) and (iii) is otherwise
appropriate and desirable.

         (e) Payment of Option Exercise Price: The exercise price of any stock
option will be payable in cash or by check payable to the order of Lennar,
except that the Committee or the Officers and Directors Stock Option Committee
may determine, in its discretion, that the exercise price of the stock option
may be paid by delivering shares of Common Stock with a fair market value at the
date the stock option is exercised equal to all or any part of the exercise
price, with any remaining balance to be paid in cash or by check payable to the
order of Lennar.

7. Terms and Conditions of Restricted Stock

         (a) Performance Goals: The Committee or the Officers and Directors
Stock Option Committee, in its Discretion, shall in the case of grants of
Restricted Stock intended to qualify for an exception from the limitation
imposed by Section 162(m) of the Code (i) establish one or more performance
goals ("Performance Goals") as a precondition to the grant of Restricted Stock
awards, and (ii) provide, in connection with the establishment of the
Performance Goals, for predetermined grants of specified numbers of shares of
Restricted Stock to those Grantees (who continue to meet all applicable
eligibility requirements) with respect to whom the applicable Performance Goals
are satisfied; provided, however, that the Committee or the Officers and
Directors Stock Option Committee shall retain the

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discretion to reduce the number of shares subject to the Restricted Stock grant
prior to the award. The Performance Goals shall be based upon the achievement of
(i) a specified level, of (x) the Company's consolidated pre-tax or after-tax
earnings or EBITDA or (y) the pre-tax or after-tax earnings, or the EBITDA, of
any particular subsidiary, division or other business unit of Lennar or the
Company, (ii) the achievement of a specified level of revenues, earnings, costs,
return on assets, return on equity, return on capital, return on investment,
return on assets under management, net operating income or net operating income
as a percentage of book value with regard to the Company, particular
subsidiaries, divisions or business units of Lennar or the Company, particular
assets or groups of assets or particular employees or groups of employees, or
(iii) any combination of the foregoing. Performance Goals may be absolute
amounts or percentages of amounts or may be relative to the performance of other
companies or of indexes. The Performance Goals shall be established in a timely
fashion such that they are considered preestablished for purposes of the rules
governing performance-based compensation under Section 162(m) of the Code. Prior
to the award of Restricted Stock hereunder, the Officers and Directors Stock
Option Committee shall have certified that any applicable Performance Goals, and
other material terms of the grant, have been satisfied. Notwithstanding the
foregoing, Performance Goals which do not satisfy the foregoing provisions of
this Section 7(a) may be established by the Committee or the Officers and
Directors Stock Option Committee with respect to grants of Restricted Stock not
intended to qualify for an exception from the limitations imposed by Section
162(m) of the Code.

         (b) Vesting Periods: In connection with the grant of a Restricted Stock
award, whether or not Performance Goals apply thereto, the Committee or the
Officers and Directors Stock Option Committee shall establish one or more
vesting periods ("Vesting Periods") with respect to the shares of Restricted
Stock granted hereunder, the length of which shall be determined in the
Discretion of the Committee or the Officers and Directors Stock Option
Committee. Subject to the provisions of this Section 7, the Restricted Stock
agreement and the other provisions of the Plan, restrictions on Restricted Stock
shall lapse if the Grantee satisfies all applicable employment or other service
requirements through the end of the applicable Vesting Period.

         (c) Assignment: No Restricted Stock award granted under the Plan may be
assigned or transferred, other than as provided in Section 15 upon the death of
the Grantee to whom the Restricted Stock was granted; provided, however, that
the Committee or the Officers and Directors Stock Option Committee may (but need
not) permit other transfers, where the Committee or the Officers and Directors
Stock Option Committee concludes that such transferability is appropriate and
desirable.

         (d) Certificates: A stock certificate shall be issued with respect to
shares of Restricted Stock awarded under the Plan. Such certificates shall be
registered in the name of the Grantee. The certificates for shares of Restricted
Stock issued hereunder may include any legend which the Committee or the
Officers and Directors Stock Option Committee deems appropriate to reflect any
restrictions on transfer hereunder or under the written agreement, or as the
Committee or the Officers and Directors Stock Option Committee may otherwise
deem appropriate, and, without limiting the generality of the foregoing, shall
bear a legend referring to the terms, conditions, and restrictions applicable to
such award, substantially in the following form:

         The transferability of this certificate and the shares of stock
         represented hereby are subject to the terms and conditions (including
         forfeiture) of the Lennar Corporation 2000 Stock Option and Restricted
         Stock Plan and a written agreement entered into between the registered
         owner and Lennar Corporation. Copies of such Plan and agreement are on
         file in the offices of the Lennar Corporation at 700 NW 107th Avenue,
         Miami, Florida, 33172.

         (e) The Committee or the Officers and Directors Stock Option Committee
shall require that the stock certificates evidencing such shares be held in
custody by Lennar until the restrictions thereon shall have lapsed, and that, as
a condition of any Restricted Stock award, the Grantee shall have delivered a
stock power, endorsed in blank, relating to the stock covered by such award. If
and when such restrictions so lapse, the stock certificates and stock power
shall be delivered by Lennar to the recipient or his or her designee.

8. Withholding Payment

         If as a result of (i) the exercise of a stock option or a Stock
Appreciation Right, or (ii) the lapse of restrictions on Restricted Stock (or
other income recognition event, such as an election under Section 83 (b) of the
Code), the

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Company is required to pay any amount as withheld income tax (or such other
applicable tax), the Company may, at its Discretion, either (i) reduce the
number of shares of Common Stock issuable upon exercise of the stock option, or
the cash or Common Stock to be paid or delivered upon exercise of the Stock
Appreciation Right, by the amount of the required withholding (with the Common
Stock valued at its fair market value on the date the stock option or Stock
Appreciation Right is exercised), or (ii) require that, as a condition to
exercise of the stock option or Stock Appreciation Right or as a condition
precedent to issuance of the Restricted Stock, the Grantee remit to the Company
the amount of withholding tax required to be paid as a result of the exercise.
If a person makes a disqualifying disposition (as that term is used in Section
422 of the Code) of shares acquired upon exercise of an Incentive Option, that
person will promptly notify the Company of the disqualifying disposition and pay
to the Company an amount equal to any withholding tax the Company is required to
pay as a result of the disqualifying disposition. If a person fails to reimburse
the Company for any sum he or she is required to pay as a result of a
disqualifying disposition of shares acquired upon exercise of an Incentive
Option, the Company may withhold that amount from any payments of salary or
other payments the Company is required to make to the person or may take any
other lawful steps to collect that amount from the person.

9. Written Agreement

         Promptly after a stock option, Stock Appreciation Right or Restricted
Stock award is granted under the Plan, Lennar will provide the Grantee of such
stock option, Stock Appreciation Right or Restricted Stock with a written
agreement containing the provisions of such award. The terms of the agreement
will be in accordance with the Plan, but may contain additional provisions and
restrictions authorized by the Committee or the Officers and Directors Stock
Option Committee, in its Discretion, which are not inconsistent with the Plan.
Each agreement relating to a stock option will state whether the stock option is
or is not intended to be an Incentive Option. Each Grantee of an award granted
under the Plan will be bound by the terms of the Plan and of the agreement
relating to the stock option, Stock Appreciation Right or Restricted Stock.

10. Administration of the Plan

         (a) The Plan will be administered by the Committee or the Officers and
Directors Stock Option Committee. The Officers and Directors Stock Option
Committee shall be authorized to take action under the Plan as it relates to and
in order to comply with Section 162(m) of the Code.

         (b) The Committee or the Officers and Directors Stock Option Committee
will have full power to construe, interpret and administer the Plan and to
establish and change the rules and regulations for its administration.

         (c) Subject to the limitations contained in the Plan, the Committee or
the Officers and Directors Stock Option Committee will have full power, in its
Discretion, (i) to grant Incentive Options, Nonqualified Options, Stock
Appreciation Rights or Restricted Stock to any one or more Key Employees or
Directors, as applicable, (ii) to determine as to any stock option, or Stock
Appreciation Right granted to any Key Employee or Director the number of shares
of Common Stock to which the stock option or Stock Appreciation Right will
relate, the exercise price of the stock option or Stock Appreciation Right, the
term of the stock option or Stock Appreciation Right, and all other terms of the
stock option or Stock Appreciation Right and (iii) to determine the number of
shares of Restricted Stock granted to any Key Employee or Director and all other
terms of the Restricted Stock.

         (d) In exercising its powers under the Plan, the Committee or the
Officers and Directors Stock Option Committee may act in its sole discretion,
with no requirement that it follow past practice or treat one employee, officer
or Director in a manner consistent with the treatment afforded to any other
employee, officer or Director.

         (e) All actions taken and decisions made by the Committee or the
Officers and Directors Stock Option Committee will be binding and conclusive on
all Grantees of stock options, Stock Appreciation Rights or Restricted Stock
granted under the Plan and all other officers, employees and Directors of the
Company, and on their respective legal representatives and beneficiaries. No
member of the Committee or the Officers and Directors Stock Option Committee
will be liable for any determination made or action taken in good faith with
respect to the Plan or any stock options, Stock Appreciation Rights or
Restricted Stock granted under the Plan, or for any decision not to grant stock
options, Stock Appreciation Rights or Restricted Stock under the Plan to any
officer, employee or Director of the Company.

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11. Shares Available for Options

         The aggregate number of shares of Common Stock which may be issued as
Restricted Stock or upon exercise of stock options (including Assumed Options)
or Stock Appreciation Rights granted under this Plan is four million (4,000,000)
shares, subject to adjustment as provided in Section 13. Any shares of
Restricted Stock or shares which are subject to stock options or Stock
Appreciation Rights which terminate or are surrendered (including shares subject
to stock options which are deemed surrendered because of exercise of Stock
Appreciation Rights, to the extent the shares are not issued on exercise of the
Stock Appreciation Rights) may again be made the subject of awards under the
Plan, will be available to be issued as Restricted Stock or subsequently granted
stock options or Stock Appreciation Rights. Any shares as to which stock options
or Stock Appreciation Rights are exercised but which are retained by Lennar to
pay the exercise price of stock options, to reimburse the Company for paying
withholding taxes or otherwise, will be deemed to have been issued upon exercise
of stock options or Stock Appreciation Rights, and will not be available to be
issued as Restricted Stock or on exercise of other stock options or Stock
Appreciation Rights.

12. Laws and Regulations

         (a) The obligation of the Company to sell shares with respect to an
award granted under the Plan shall be subject to all applicable laws, rules and
regulations, including all applicable federal and state securities laws, and the
obtaining of all such approvals by governmental agencies as may be deemed
necessary or appropriate by the Committee or the Officers and Directors Stock
Option Committee.

         (b) The Committee or the Officers and Directors Stock Option Committee
may make such changes to the Plan as may be necessary or appropriate to comply
with the rules and regulations of any government authority or to obtain tax
benefits applicable to an award.

         (c) Each grant of stock options, Stock Appreciation Rights or
Restricted Stock is subject to the requirement that, if at any time the
Committee or the Officers and Directors Stock Option Committee determines, in
its discretion, that the listing, registration or qualification of shares
issuable pursuant to the Plan is required by any securities exchange or under
any state or federal law, or the consent or approval of any governmental
regulatory body is necessary or desirable as a condition of, or in connection
with, the issuance of stock options, Stock Appreciation Rights or shares of
Restricted Stock, no payment shall be made, or shares issued or grants of
Restricted Stock made, in whole or in part, unless listing, registration,
qualification, consent or approval has been effected or obtained free of any
conditions in a manner acceptable to the Committee or the Officers and Directors
Stock Option Committee.

         (d) In the event that the disposition of stock acquired pursuant to the
Plan is not covered by a then current registration statement under the
Securities Act, and is not otherwise exempt from such registration, such shares
shall be restricted against transfer to the extent required under the Securities
Act, and the Committee or the Officers and Directors Stock Option Committee may
require any individual receiving shares pursuant to the Plan, as a condition
precedent to receipt of such shares, to represent to the Company in writing that
such shares are acquired for investment only and not with a view to distribution
and that such shares will be disposed of only if registered for sale under the
Securities Act or if there is an available exemption for such disposition.

13. Modification of Numbers of Shares and Other Securities

         If (a) the Company at any time is involved in a merger, consolidation,
dissolution, liquidation, reorganization, exchange of shares, sale of all or
substantially all of the assets or stock of the Company or similar transaction,
(b) there is a stock dividend, stock split, reverse stock split, stock
combination, reclassification, recapitalization or other similar change in the
capital structure of Lennar, or a distribution to holders of Common Stock other
than a cash dividend or (c) any other event occurs which in the judgment of the
Committee necessitates an adjustment to the

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terms of the outstanding stock options, Stock Appreciation Rights or Restricted
Stock awards which were issued under the Plan, the Committee or the Officers and
Directors Stock Option Committee may make such modifications in the terms of
outstanding stock options, Stock Appreciation Rights or Restricted Stock awards
as in its judgment are appropriate so the Grantees' rights will be substantially
proportionate to the rights existing prior to the event, and to maintain the
continuing availability of shares under Section 11 (if shares are otherwise then
available) including, without limitation, adjustments in (i) the number and kind
of shares subject to stock options or Restricted Stock awards, (ii) the exercise
price of outstanding stock options and (iii) the number and kind of shares
available under Section 11. To the extent that such action includes an increase
or decrease in the number of shares subject to outstanding options, Stock
Appreciation Rights or Restricted Stock awards, the number of shares available
under Section 11 above will be increased or decreased, as the case may be,
proportionately. In addition, the limits on the number of options or Restricted
Stock that may be granted to an individual under Sections 3 and 5 may be
adjusted proportionately. The judgment of the Committee or the Officers and
Directors Stock Option Committee with respect to any matter referred to in this
Section 13 will be conclusive and binding upon each Grantee without the need for
any amendment to the Plan or any stock options, Stock Appreciation Rights or
Restricted Stock which had been granted under the Plan.

14. Effects of Termination of Employment

         (a) Unless otherwise provided in an individual written agreement
pursuant to Section 9 hereof, each stock option and related Stock Appreciation
Right granted under the Plan will terminate when the Grantee ceases to be an
officer, employee or Director of the Company, except that

                  (i) If a Grantee of a stock option dies while an officer,
         employee or Director of the Company, each stock option and related
         Stock Appreciation Right granted under the Plan (or any predecessor)
         and held by the Grantee at the date of the Grantee's death shall become
         fully vested and may be exercised, by the Grantee's legal
         representative until 12 months after the date of death.

                  (ii) If a Grantee of a stock option ceases to be an officer,
         employee or Director of the Company,

                  (A)      after the Grantee becomes 65 years old,

                  (B)      because of the disability of the Grantee (as
                           determined by the Committee in its Discretion), or

                  (C)      under other circumstances which the Committee or the
                           Officers and Directors Stock Option Committee, in its
                           Discretion, determines to justify continued exercise
                           of stock options and related Stock Appreciation
                           Rights,

each stock option and related Stock Appreciation Right held by the Grantee on
the date the Grantee ceased to be an officer, employee or Director of the
Company may be exercised, to the extent it was exercisable on the date the
Grantee ceased to be an officer, employee or Director of the Company (or, with
the consent of the Committee or the Officers and Directors Stock Option
Committee in full) until the earlier of (x) three months after the date the
Grantee ceases to be an officer, employee or Director of the Company, or (y) the
date the stock option expires by its own terms.

         (b) Notwithstanding the above, if an Incentive Option is granted to a
Director or officer, who is also an employee, in the event such Grantee ceases
to be an employee, that option may be converted to a Nonqualified Option, under
circumstances which the Committee or the Officers and Directors Stock Option
Committee, in its Discretion deems appropriate, if that option is not exercised
by the Grantee within three months of the time the Grantee ceases to be an
employee, and shall thereafter be subject to the provisions of clause (A), (B)
or (C) of subparagraph (a) (ii) above so long as the Grantee remains a Director
or officer.

         (c) Unless otherwise provided in an individual written agreement
pursuant to Section 9 hereof, each nonvested Restricted Stock granted under the
Plan will be forfeited when the Grantee ceases to be an officer, employee or
Director of the Company, except that

                                       8
<PAGE>

                  (i) If a Grantee of a nonvested Restricted Stock award dies
         while an officer, employee or Director of the Company, all restrictions
         will immediately lapse on all Restricted Stock granted to the
         applicable Grantee, however any Performance Goals under Section 7 must
         still be achieved prior to the award of such shares of Restricted
         Stock.

                  (ii) If a Grantee of a nonvested Restricted Stock ceases to be
         an officer, employee or Director of the Company,

                  (A)      because of disability of the Grantee (as determined
                           by the Committee or the Officers and Directors Stock
                           Option Committee in its discretion), or

                  (B)      under other circumstances as determined by the
                           Committee or the Officers and Directors Stock Option
                           Committee, in its discretion,

such Restricted Stock shall (with the consent of the Committee or the Officers
and Directors Stock Option Committee) not be forfeited; however, any Performance
Goals under Section 7 must still be achieved prior to the award of such shares
of Restricted Stock.

         (d) Notwithstanding the above, (i) each stock option granted under the
Plan (or any predecessor Plan) shall be fully vested and the restrictions will
immediately lapse on all Restricted Stock granted under the Plan and any
Performance Goals shall be deemed to be met upon a Change in Control. For
purposes of this Plan, a "Change in Control" means the occurrence of one or more
of the following events: (i) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all or substantially all of
the assets of the Company to any person or group of related persons for purposes
of Section 13(d) of the Securities Exchange Act of 1934, as amended (a "Group"),
together with any affiliates thereof, other than a transaction with any wholly
owned subsidiary of Company, (ii) the approval by the holders of capital stock
of the Company of any plan or proposal for the liquidation or dissolution of the
Company; (iii) any Person or Group (other than Leonard Miller and any Permitted
Transferees of Leonard Miller) shall become the owner, directly or indirectly,
beneficially or of record, of shares representing more than 50% of the aggregate
ordinary voting power represented by the issued and outstanding capital stock of
Company; (iv) a majority of the members of the Board of Directors of the Company
are persons who were not Directors on the date of this Plan and whose election
was not approved by a vote of at least a majority of the members of the Board of
Directors of the Company in office at the time of the election who either were
members of the Board of Directors on the date of this Plan or whose election as
members of such Board of Directors was previously approved by such a majority.

"Permitted Transferee" means, with respect to any person, (i) that person's
spouse, (ii) a parent or lineal descendant (including an adopted child) of a
parent of that person, or the spouse of a lineal descendant of a parent of that
person, (iii) a trustee, guardian or custodian for, or an executor,
administrator or other legal representative of the estate of, that person, or a
trustee, guardian or custodian for a Permitted Transferee of that person, (iv)
the trustee of a trust (including a voting trust) for the benefit of that person
and (v) a corporation, partnership, trust or other entity of which that person
and Permitted Transferees of that Person are the beneficial owners of a majority
in voting power of the equity.

15. No Rights to Continued Employment

         Nothing in the Plan or in any stock option, Stock Appreciation Right or
Restricted Stock award granted under the Plan will give any officer, employee or
Director of the Company a right to continue to be an officer, employee or
Director of the Company or in any other way affect the right of the Company to
terminate the officer position or employment of any officer, employee or
Director at any time for any reason whatsoever, with or without cause.

16. Rights as a Shareholder

         Other than as provided under Section 7, Grantee shall have no rights as
a stockholder with respect to any shares covered by any stock option or Stock
Appreciation Right or any shares of Restricted Stock until the issuance of a
stock certificate to the Grantee for such shares.

                                       9
<PAGE>

17. Effective Date

         This restatement of the Plan will be effective on the date it is
adopted by the Board of Directors, provided that the stockholders of Lennar
approve this restatement within 12 months after it is adopted by the Board of
Directors. Stock options, Stock Appreciation Rights and Restricted Stock may be
granted prior to approval of the Plan by the stockholders of Lennar, but each
stock option, Stock Appreciation Right and Restricted Stock granted prior to
stockholder approval of this restatement will be subject to approval of this
restatement by the stockholders of Lennar within 12 months after its adoption.
No stock option or Stock Appreciation Right may be exercised or Restricted Stock
become vested until the Plan is approved by the stockholders of Lennar, and all
stock options, Stock Appreciation Rights and Restricted Stock granted before the
Plan is approved by the stockholders of Lennar will automatically terminate at
the end of 12 months after the Plan is adopted by the Board of Directors if the
Plan is not approved by the stockholders of Lennar by that date.

18. Amendments of the Plan

         The Board of Directors may amend the Plan at any time, except that no
amendment to the Plan will be effective until it is approved by the stockholders
of Lennar if the amendment (a) increases the maximum number of shares which may
be issued as Restricted Stock or upon exercise of stock options or Stock
Appreciation Rights granted under the Plan, (b) changes the categories of
persons eligible to receive stock options, Stock Appreciation Rights or
Restricted Stock under the Plan or (c) materially increases the benefits
officers or employees of the Company may receive under the Plan. No amendment to
the Plan will change the exercise price, or otherwise alter any provision, of
any stock option, Stock Appreciation Right or Restricted Stock which has been
granted prior to the amendment, unless the Grantee of the stock option, Stock
Appreciation Right or Restricted Stock consents to the change.

19. Termination of the Plan

         The Plan may be terminated at any time by the Board of Directors. The
Plan will terminate on the 10th anniversary of the date it is adopted by the
Board of Directors unless it is terminated before that. No stock options, Stock
Appreciation Rights or Restricted Stock may be granted after the Plan is
terminated. However, termination of the Plan will not affect any stock option,
Stock Appreciation Right or Restricted Stock which is outstanding when the Plan
is terminated.

20. Governing Law

         With respect to stock or options granted pursuant to the Plan and the
agreements thereunder, the Plan, such agreements and any options or stock
granted pursuant thereto shall be governed by the applicable Code provisions to
the maximum extent possible. Otherwise, the operation of, and the rights of
Grantees under, the Plan, the agreements and any options or stock granted
thereunder shall be governed by applicable federal law and, to the extent not
governed by federal law, by the laws of the State of Florida.

         As approved by the Board of Directors of Lennar Corporation on June 22,
2000.

                                       10EXHIBIT 10.16

                           SECOND AMENDED AND RESTATED
                           REVOLVING CREDIT AGREEMENT

                            DATED AS OF JULY 14, 2000

                                      AMONG

                            LNR PROPERTY CORPORATION
                        AND CERTAIN OF ITS SUBSIDIARIES,

                           THE LENDERS NAMED THEREIN,

                                       AND

                             BANK OF AMERICA, N.A.,
                            AS ADMINISTRATIVE AGENT,

                        U.S. BANK, NATIONAL ASSOCIATION,
                              AS SYNDICATION AGENT,

                              FLEET NATIONAL BANK,
                             AS DOCUMENTATION AGENT

                                       AND

                         GUARANTY FEDERAL BANK, F.S.B.,
                                AS MANAGING AGENT

                                      WITH

                         BANC OF AMERICA SECURITIES LLC,
                   AS SOLE LEAD ARRANGER AND SOLE BOOK MANAGER

<PAGE>

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S>                                                                                                              <C>
ARTICLE I.........................................................................................................2
         1.1 Definitions..........................................................................................2
         1.2 Financial Standards.................................................................................23

ARTICLE II.......................................................................................................23
         2.1 The Facility........................................................................................23
         2.2 Principal Payments and Extension Option.............................................................25
         2.3 Requests for Advances: responsibility for Advances..................................................26
         2.4 Evidence of Credit Extensions.......................................................................26
         2.5 Ratable and Non-Pro Rata Loans......................................................................26
         2.6 Applicable Margins..................................................................................26
         2.7 Commitment Fee......................................................................................27
         2.8 Other Fees..........................................................................................27
         2.9 Minimum Amount of Each Advance......................................................................28
         2.10 Interest...........................................................................................28
         2.11 Selection of Rate Options and LIBOR Interest Periods...............................................29
         2.12 Method of Payment..................................................................................31
         2.13 Default............................................................................................31
         2.14 Lending Installations..............................................................................32
         2.15 Non-Receipt of Funds by Agent......................................................................32
         2.16 Swingline Loans....................................................................................32
         2.19 Application of Moneys Received.....................................................................33

ARTICLE III......................................................................................................34
         3.1 Obligation to Issue.................................................................................34
         3.2 Types and Amounts...................................................................................35
         3.3 Conditions..........................................................................................35
         3.4 Procedure for Issuance of Facility Letters of Credit................................................36
         3.5 Reimbursement Obligations: Duties of Issuing Bank...................................................37
         3.6 Participation.......................................................................................38
         3.7 Payment of Reimbursement Obligations................................................................39
         3.8 Compensation for Facility Letters of Credit.........................................................41
         3.9 Letter of Credit Collateral Account.................................................................41

ARTICLE IV.......................................................................................................42
         4.1 Yield Protection....................................................................................42
         4.2 Changes in Capital Adequacy Regulations.............................................................42
         4.3 Availability of LIBOR Advances......................................................................43
         4.4 Funding Indemnification.............................................................................43
         4.5 Lender Statements; Survival of Indemnity............................................................44
         4.6 Lender Statements; Survival of Indemnity............................................................44
</TABLE>

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                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S>                                                                                                              <C>
ARTICLE V........................................................................................................46
         5.1 Conditions Precedent to Closing.....................................................................46
         5.2 Conditions Precedent to Subsequent Advances.........................................................48

ARTICLE VI.......................................................................................................49
         6.1 Existence...........................................................................................49
         6.2 Corporate/Partnership Powers........................................................................49
         6.3 Power of Officers...................................................................................50
         6.4 Government and Other Approvals......................................................................50
         6.5 Solvency............................................................................................50
         6.6 Compliance With Laws and Agreements.................................................................50
         6.7 Enforceability of Agreement.........................................................................50
         6.8 Title to Property...................................................................................51
         6.9 Litigation..........................................................................................51
         6.10 Events of Default..................................................................................51
         6.11 Investment Company Act of 1940.....................................................................51
         6.12 Public Utility Holding Company Act.................................................................51
         6.13 Regulation U.......................................................................................51
         6.14 No Material Adverse Financial Change...............................................................51
         6.15 Financial Information..............................................................................52
         6.16 Factual Information................................................................................52
         6.17 ERISA..............................................................................................52
         6.18 Taxes..............................................................................................52
         6.19 Environmental Matters..............................................................................52
         6.20 Insurance..........................................................................................53
         6.21 No Brokers.........................................................................................53
         6.22 No Violation of Usury Laws.........................................................................54
         6.23 Not a Foreign Person...............................................................................54
         6.24 No Trade Name......................................................................................54
         6.25 Subsidiaries.......................................................................................54
         6.26 Properties.........................................................................................54
         6.27 Relationship of the Borrower.......................................................................56
         6.28 No Side Deals......................................................................................56
         6.29 Stock Pledge.......................................................................................56

ARTICLE VII......................................................................................................56
         7.1 Borrowing Base Limit................................................................................56
         7.2 Maximum Leverage Ratio..............................................................................56
         7.3 Minimum Consolidated Tangible Net Worth.............................................................57
         7.4 Interest Coverage...................................................................................57
         7.5 Fixed Charge Coverage...............................................................................57
         7.6 Other Unsecured Senior Debt.........................................................................57
         7.7 Subordinated Debt...................................................................................57
</TABLE>

<PAGE>

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S>                                                                                                              <C>
ARTICLE VIII.....................................................................................................58
         8.1 Notices.............................................................................................58
         8.2 Financial Statements, Reports. Etc..................................................................58
         8.3 Existence and Conduct of Operations.................................................................62
         8.4 Maintenance of Properties...........................................................................62
         8.5 Insurance...........................................................................................62
         8.6 Payment of Obligations..............................................................................63
         8.7 Compliance with Laws................................................................................63
         8.8 Adequate Books......................................................................................63
         8.9 ERISA...............................................................................................63
         8.10 Maintenance of Status..............................................................................63
         8.11 Use of Proceeds....................................................................................63
         8.12 Pre-Acquisition Environmental Investigations.......................................................63
         8.13 Joinder of New Subsidiaries........................................................................64
         8.14 Interest Rate Protection...........................................................................64
         8.15 Investment in Mortgage Subsidiary..................................................................64

ARTICLE IX.......................................................................................................64
         9.1 Change in Business..................................................................................65
         9.3 Foreign Investments.................................................................................65
         9.3 Change of Control...................................................................................65
         9.4 Use of Proceeds.....................................................................................65
         9.5 Transfers of Unencumbered Assets....................................................................65
         9.6 Liens...............................................................................................65
         9.7 Regulation U........................................................................................66
         9.8 Mergers and Dispositions............................................................................66
         9.9 Negative Pledge.....................................................................................67
         9.10 Distributions......................................................................................67

ARTICLE X........................................................................................................68
         10.1 Nonpayment of Principal............................................................................68
         10.2 Certain Covenants..................................................................................68
         10.3 Nonpayment of Interest and Other Obligations.......................................................68
         10.4 Cross Default......................................................................................68
         10.5 Loan Documents.....................................................................................68
         10.6 Representation or Warranty.........................................................................68
         10.7 Covenants, Agreements and Other Conditions.........................................................68
         10.9 Material Adverse Financial Change..................................................................69
         10.10 Bankruptcy........................................................................................69
         10.11 Legal Proceedings.................................................................................69
         10.12 ERISA.............................................................................................70
         10.13 Failure to Satisfy Judgments......................................................................70
         10.14 Environmental Remediation.........................................................................70
</TABLE>

<PAGE>

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S>                                                                                                              <C>
ARTICLE XI.......................................................................................................70
         11.1 Acceleration.......................................................................................70
         11.2 Preservation of Rights; Amendments.................................................................71

ARTICLE XII......................................................................................................71
         12.1 Appointment........................................................................................71
         12.2 Powers.............................................................................................72
         12.3 General Immunity...................................................................................72
         12.4 No Responsibility for Loans, Recitals, etc.........................................................72
         12.5 Action on Instructions of Lenders..................................................................73
         12.6 Employment of Agents and Counsel...................................................................73
         12.7 Reliance on Documents; Counsel.....................................................................73
         12.8 Agent's Reimbursement and Indemnification..........................................................73
         12.9 Rights as a Lender.................................................................................74
         12.10 Commitment as a Lender............................................................................74
         12.11 Lender Credit Decision............................................................................74
         12.12 Successor Agent...................................................................................75
         12.13 Notice of Defaults................................................................................75
         12.14 Requests for Approval.............................................................................75
         12.15 Copies of Documents...............................................................................76
         12.16 Defaulting Lenders................................................................................76
         12.17 Withholding Tax...................................................................................76
         12.18 Borrower's Default Enforcement....................................................................77
         12.20 Bankruptcy of Borrower Tax........................................................................77
         12.21 Relationship of Parties...........................................................................77

ARTICLE XIII.....................................................................................................78
         13.1 Successors and Assigns.............................................................................78
         13.2 Participations.....................................................................................78
                  13.2.1  Permitted Participants: Effect.........................................................78
                  13.2.2  Voting Rights..........................................................................78
         13.3 Assignments........................................................................................79
                  13.3.1  Permitted Assignments..................................................................79
                  13.3.2  Effect: Effective Date of Assignment...................................................79
         13.4 Dissemination of Information.......................................................................80
         13.5 Tax Treatment......................................................................................80

ARTICLE XIV......................................................................................................80
         14.1 Survival of Representations........................................................................80
         14.2 Governmental Regulation............................................................................80
         14.3 Taxes..............................................................................................80
         14.4 Headings...........................................................................................80
         14.5 No Third Party Beneficiaries.......................................................................80
         14.6 Expenses: Indemnification..........................................................................81
         14.7 Severability of Provisions.........................................................................81
</TABLE>

<PAGE>

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S>                                                                                                              <C>

         14.8 Nonliability of the Lenders........................................................................81
         14.9 Choice of Law......................................................................................82
         14.10 Consent to Jurisdiction...........................................................................82
         14.11 Waiver of Jury Trial..............................................................................82
         14.12 Successors and Assigns............................................................................82
         14.13 Entire Agreement; Modification of Agreement.......................................................82
         14.14 Dealings with the Borrower........................................................................83
         14.15 Set-Off...........................................................................................83
         14.16 Counterparts......................................................................................84
         14.18 Rights of Contribution among Credit Parties.......................................................84
         14.19 General Limitation on Obligations.................................................................85

ARTICLE XV.......................................................................................................85
         15.1 Giving Notice......................................................................................85
         15.2 Change of Address..................................................................................86
</TABLE>

<PAGE>

                           SECOND AMENDED AND RESTATED
                           REVOLVING CREDIT AGREEMENT

         THIS SECOND AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT is entered
into as of July 14, 2000, by and among LNR PROPERTY CORPORATION, a Delaware
corporation having its principal place of business at 760 N.W. 107th Avenue,
Miami, Florida 33172 ("LNR"), the Subsidiaries of LNR identified on Schedule I
(LNR and said Subsidiaries being referred to herein jointly and severally as the
"Borrower"), the Lenders (as hereinafter defined), BANK OF AMERICA, N.A., a
national banking association ("Bank of America") as administrative agent (the
"Agent") for the Lenders, U.S. Bank, National Association, as syndication agent
("Syndication Agent") for the Lenders, Fleet National Bank, as documentation
agent ("Documentation Agent") for the Lenders, and Guaranty Federal Bank,
F.S.B., as managing agent ("Managing Agent") for the Lenders.

                                    RECITALS

         A. The Borrower is primarily engaged in the business of (i) acquiring,
developing, owning and operating a variety of commercial and industrial real
properties, (ii) acquiring, itself or through partnerships which it manages,
portfolios of commercial mortgage loans and real properties and providing
workout, property management and asset sale services with regard to such
portfolio assets, (iii) through Lennar Partners, Inc., a wholly owned Subsidiary
of LNR, acting as special servicer with regard to commercial mortgage pools
which are the subject of commercial mortgage backed securities ("CMBS"), (iv)
acquiring unrated and rated CMBS issued with regard to commercial mortgage pools
as to which LNR acts as special servicer, (v) making mortgage loans to companies
and individuals engaged in commercial real estate activities and to developers
and builders of residential communities, and (vi) investing in real estate
related businesses.

         B. The Borrower has requested that the Lenders make loans available to
the Borrower in the maximum aggregate principal amount of Three Hundred and
Twenty Five Million Dollars ($325,000,000), subject to increase as provided in
Section 2.1(c) hereof and subject to any decrease pursuant to Section 12.10
hereof (as the same may be so increased or decreased, the "Facility Amount"),
outstanding from time to time pursuant to the terms of this Agreement (the
"Facility"), and that the Agent act as administrative agent for the Lenders.
Pursuant to arrangements made by Banc of America Securities LLC, the Sole Lead
Arranger and Sole Book Manager for the Facility, the Agent and the Lenders have
agreed to do so.

         C. The Borrower, Bank of America and the Agent entered into that
certain Amended and Restated Revolving Credit Agreement dated March 27, 1998, as
amended by that certain First Amendment to Amended and Restated Revolving Credit
Agreement dated April 10, 1998, that certain Second Amendment to Amended and
Restated Revolving Credit Agreement dated September 14, 1998 and that certain
Third Amendment to Amended and Restated Revolving

                                       1
<PAGE>

Credit Agreement dated March 20, 2000 (as amended, the "Original Agreement") and
the parties hereto wish to amend and restate the Original Agreement in its
entirety as hereinafter set forth.

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereto hereby agree as follows:

                                    ARTICLE I

                        DEFINITIONS AND ACCOUNTING TERMS

         1.1 Definitions. As used in this Agreement, the following terms have
the respective meanings set forth below:

         "Adjusted Base Rate" means a floating interest rate equal to the Base
Rate plus the Applicable Margin changing when and as the Base Rate or the
Applicable Margin changes.

         "Additional CMBS Interest Income" means, for any fiscal quarter, that
portion of the interest on CMBS paid to the Borrower during such quarter that is
excluded from Net Income (as defined in clause (i) of the definition of
"EBITDA"), and that is applied to reduce the book bases of Borrower's
investments in such CMBS (such exclusion from Net Income and application to
reduce basis being referred to herein as a "CMBS Adjustment"), as such portion
is reported by Borrower from time to time on its report filed on Forms 10Q and
10K with the Securities and Exchange Commission under the heading "Interest
received on CMBS in excess of income recognized," and as otherwise substantiated
to the satisfaction of the Agent.

         "Adjusted EBITDA" means an amount equal to (i) EBITDA less (ii) the
product of (a) 0.03 multiplied by (b) the sum of the Effective Gross Income
generated by each Project.

         "Adjusted LIBOR Rate" means, with respect to a LIBOR Advance for the
relevant LIBOR Interest Period, the sum of (i) the quotient of (a) the LIBOR
Rate applicable to such LIBOR Interest Period, divided by (b) one minus the
Reserve Requirement (expressed as a decimal) applicable to such LIBOR Interest
Period, plus (ii) the Applicable Margin in effect from time to time during such
LIBOR Interest Period.

         "Adjusted Net Operating Income" means, as to any property, the Net
Operating Income generated by such property over any fiscal period, on an
annualized basis (if such period is less than a full fiscal year), less an
amount equal to the product of 0.03 multiplied by the Effective Gross Income
generated by such property for such period, on an annualized basis (if such
period is less than a full fiscal year).

         "Advance" means a loan to the Borrower hereunder by one or more of the
Lenders pursuant to Section 2.l(a) hereof (including Swingline Loans), including
the initial Advance and all subsequent Advances, whether such Advances are, from
time to time, Base Rate Advances, LIBOR Advances or Swingline Loans.

                                       2
<PAGE>

         "Affiliate" means any Person directly or indirectly controlling,
controlled by or under direct or indirect common control with any other Person.
A Person shall be deemed to control another Person if the controlling Person
owns ten percent (10%) or more of any class of voting securities of the
controlled Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise.

         "Agent" is defined in the preamble of this Agreement and means Bank of
America, acting as administrative agent for the Lenders in connection with the
transactions contemplated by this Agreement, and its successors in such
capacity.

         "Aggregate Commitment" means, as of any date, the sum of all of the
Lenders' then-current Stated Commitments, provided that the Aggregate Commitment
shall not at any time exceed an amount equal to the lesser of (a) the Facility
Amount, (b) the Borrowing Base and (c) the maximum amount that permits
compliance with Article VII hereof.

         "Agreement" means this Second Amended and Restated Revolving Credit
Agreement and all amendments, modifications and supplements hereto.

         "Agreement Execution Date" shall mean July 14, 2000.

         "Allocated Facility Amount" means, at any time, the sum of all then
outstanding Advances (including all Swingline Loans), and the then Facility
Letter of Credit Obligations.

         "Applicable Laws" is defined in Section 6.26(b) hereof.

         "Applicable Margin" means the applicable margin set forth in the table
in Section 2.6 used in calculating the interest rate applicable to the various
types of Advances, which shall vary from time to time in accordance with the
Leverage Ratio of Borrower in the manner set forth in Section 2.6 hereof.

         "Average Market Price" means, as to any Investment Security at any
time, the Market Price Proxy for such Investment Security; provided, however,
that if (i) such Investment Security is traded on an established securities
exchange or there otherwise exists an established market for such Investment
Security, and (ii) the Agent determines that the price established for such
Investment Security on such exchange or market would reflect the value thereof
more accurately than the Market Price Proxy, then, at the option of the Required
Lenders, the Average Market Price shall be an amount equal to the average of the
bid prices for such Investment Security at the close of trading on the last
trading day of each calendar month over the 90 day period immediately preceding
the date of determination. With respect to CMBS, the closing bid price on any
given date shall be the average of the closing bid prices quoted by at least one
generally recognized CMBS market maker for the date in question, subject to
Agent's confirmation by obtaining quotes from one or more other recognized CMBS
market makers.

                                       3
<PAGE>

         "Base Rate" means a rate per annum equal to the rate of interest
announced by Bank of America from time to time as its reference rate, changing
when and as such reference rate changes.

         "Base Rate Advance" means an Advance that bears interest at the
Adjusted Base Rate.

          "Borrower" means, individually and collectively, LNR and each of its
Subsidiaries identified on Schedule I hereto (as amended from time to time in
accordance with Section 8.13 hereof), along with their respective permitted
successors and assigns.

         "Borrowing Base" means, from time to time, the sum of the amounts
described in clauses (i) through (x) below on a consolidated basis for Borrower
and its Subsidiaries with respect to assets wholly-owned (a) by Borrower, (b)
any wholly-owned Subsidiary of Borrower (including any Subsidiary deemed to be
so owned pursuant to the terms hereof) or (c) any Guarantor, and, unless
otherwise specified below, as reflected from time to time in accordance with
GAAP in the consolidated balance sheet of Borrower and its Subsidiaries. For
purposes of clauses (ii) through (iv) below, a Subsidiary shall be deemed
wholly-owned by Borrower, notwithstanding that Borrower owns less than 100
percent of the Capital Stock thereof, so long as (x) Borrower owns, directly or
indirectly, at least 75 percent of the Capital Stock of such Subsidiary, free
and clear of any Lien, (y) Borrower exercises a level of management control of
such Subsidiary and its assets that is satisfactory to the Agent, and (z) the
Property of such Subsidiary is an Unencumbered Asset; provided, however, that
the aggregate amount included in the Borrowing Base at any time with respect to
Properties of such Subsidiaries of which Borrower owns, directly or indirectly,
less than 100 percent of the Capital Stock shall be based upon a percentage of
the Net Operating Income or book value (as the case may be) of each such
Property equal to Borrower's direct or indirect percentage ownership interest in
the relevant Subsidiary, and shall not exceed the lesser of 10 percent of the
Borrowing Base at that time or $50,000,000; and provided further that the
aggregate amount included in the Borrowing Base at any time with respect to
Properties of such Subsidiaries that are not Guarantors pursuant to clause (iv)
below shall not exceed 20 percent of the aggregate amount included at that time
in the Borrowing Base pursuant to the said clause (iv). The various components
of the Borrowing Base set forth below, and certain terms and limitations
pertaining thereto, are summarized in tabular form in Schedule II attached
hereto, which schedule is attached solely for summary purposes and convenience
of reference, is not intended to be a complete and accurate characterization of
the Borrowing Base, does not constitute a part of this Agreement, and shall not
modify or limit in any respect, or be used to construe, this or any other
provision of this Agreement.

         (i) Cash. 100 percent of cash and Cash Equivalents unencumbered by any
Lien;

         (ii) Stabilized Projects. 75 percent of the quotient of the Adjusted
Net Operating Income of all Stabilized Projects that are Unencumbered Assets
divided by 0.10 (provided, however, that the aggregate amount included at any
time in the Borrowing Base pursuant to this clause (ii) for Properties that are
Special Purpose Properties shall not exceed 15 percent of the Borrowing Base at
that time);

                                       4
<PAGE>

         (iii) Completed Projects and Development Properties. 67.5 percent of
the net book value of:

                  (a) Completed Projects that are Unencumbered Assets (provided,
         however, that the aggregate amount included at any time in the
         Borrowing Base pursuant to this clause (iii)(a) for Properties that are
         Special Purpose Properties shall not exceed 10 percent of the Borrowing
         Base at that time; and provided further that the aggregate amount
         included at any time in the Borrowing Base pursuant to clauses (ii) and
         this clause (iii)(a) for Properties that are Special Purpose Properties
         shall not exceed 20 percent of the Borrowing Base at that time); and

                  (b) Development Properties that are Unencumbered Assets
         (provided, however, that for purposes of this clause (iii)(b) Special
         Purpose Properties shall not be included in the Borrowing Base without
         the prior written consent of the Required Lenders; and provided,
         further, that the aggregate amount included at any time in the
         Borrowing Base pursuant to this clause (iii)(b) shall not exceed 25
         percent of Borrowing Base at that time; and provided further that, the
         aggregate amount included at any time in the Borrowing Base pursuant to
         clause (iii) shall not exceed 50 percent of the Borrowing Base at that
         time);

         (iv) Land Held for Investment. 50 percent of the net book value of Land
Held for Investment (provided, however, that the aggregate amount included at
any time in the Borrowing Base pursuant to this clause (iv) shall not exceed the
lesser of 15 percent of the Borrowing Base at that time or $60,000,000);

         (v) Investment Securities.

                  (a) 75 percent of the Average Market Price of Investment
         Securities unencumbered by any Lien and rated BB or better by S&P (or
         having an equivalent Moody's rating or Third Rating);

                  (b) 70 percent of the Average Market Price of Investment
         Securities unencumbered by any Lien and rated BB- through B by S&P (or
         having an equivalent Moody's rating or Third Rating);

                  (c) 60 percent of the Average Market Price of Investment
         Securities unencumbered by any Lien and either unrated by S&P or rated
         B- or lower by S&P (or having an equivalent Moody's rating or Third
         Rating) (provided, however, that the aggregate amount included at any
         time in the Borrowing Base pursuant to this clause (v)(c) shall not
         exceed 25 percent of the Borrowing Base at that time; and provided
         further that the aggregate amount included at any time in the Borrowing
         Base pursuant to clauses (v) shall not exceed 35 percent of the
         Borrowing Base at that time; and provided further that if any
         Investment Securities are rated by both Moody's, S&P and/or any Third
         Rating, the lower of the ratings shall govern and control for purposes
         of clause (v));

                                       5
<PAGE>

         (vi) Mortgage Receivables. 75 percent of the net book value of Mortgage
Loans with respect to which no Mortgage Loan Default has occurred and is
continuing, and the outstanding amount of which (including, without limitation,
outstanding principal, accrued interest and other amounts due) is less than 95
percent of the fair market value of the real property securing the same;
(provided, however, that the aggregate amount included at any time in the
Borrowing Base pursuant to this clause (vi) shall not exceed 20 percent of the
Borrowing Base at that time; and provided further that the interest of any of
the Borrower and its Subsidiaries in any Mortgage Loan included in the
computation of the Borrowing Base pursuant to this clause (vi) shall not be
encumbered by any Lien);

         (vii) Tax Credits. For each Stabilized Project and Stabilized Affiliate
Project that generates Tax Credits, 70 percent of the sum of: (a) the net
present value (using a 7 percent discount factor, which discount factor shall be
subject to annual adjustment by Agent) of the aggregate Tax Credits available
with respect to such Stabilized Project or Stabilized Affiliate Project over the
"remaining credit period" (as such term is defined in Section 42(f) of the Code)
for such Stabilized Project or Stabilized Affiliate Project; plus (b) tax losses
consisting of the net present value (using a 7 percent discount factor, which
discount factor shall be subject to annual adjustment by Agent) of an amount
equal to the product of (i) the amount calculated under clause (a) above,
multiplied by (ii) the highest marginal income tax rate applicable to Borrower
for Federal and State income tax purposes absent such Tax Credits (presently
39%), amortized over the remaining credit period at the rate of one
twenty-second (1/22) per year, with the balance being fully amortized during the
last year of the credit period (provided, however, that the amount included at
any time in the Borrowing Base pursuant to this clause (vii) shall not exceed 25
percent of the Borrowing Base at that time);

         (viii) Portfolio/Single Asset Partnerships. 37.5 percent of the net
book value of Investments in Portfolio/Single Asset Partnerships (provided,
however, that no new Portfolio/Single Asset Partnership involving (a) an
investment or anticipated investment of more than $25,000,000 or (b) an
investment in a Portfolio/Single Asset Partnership which is not principally
dedicated to the ownership and management of real property, loans secured by
real property or other related real property businesses shall not be included in
the Borrowing Base pursuant to this clause (viii) without the prior written
approval of the Required Lenders);

         (ix) Strategic Investments. 50 percent of the net book value of
Strategic Investments (provided, however, that the amount included at any time
in the Borrowing Base pursuant to this clause (ix) for mezzanine loans shall not
exceed the lesser of 15 percent of the Borrowing Base at that time or
$40,000,000; and provided further that, no Strategic Investment involving an
Investment of more than $25,000,000 shall be included in the Borrowing Base
without the prior written approval of the Required Lenders); and

         (x) Land Partnerships. 30 percent of the net book value of Investments
in Land Partnerships (provided, however, that any outstanding Indebtedness
secured by a Lien on the real property owned by each such Land Partnership does
not exceed 50 percent of the net book value of such real property; and provided
further that the amount included at any time in the Borrowing Base pursuant to
this clause (x) does not exceed 15 percent of the Borrowing Base at that time,

                                       6
<PAGE>

and provided further that the aggregate amount included at any time in the
Borrowing Base pursuant to clauses (viii) through (x) shall not exceed 50
percent of the Borrowing Base at that time; and provided further that the
interests of Borrower and its Subsidiaries in the Investment referred to in said
clauses (viii) through (x) shall not be encumbered by any Lien); and provided
further that, the aggregate amount included at any time in the Borrowing Base
pursuant to clauses (viii) through (x) for Investments in partnerships and/or
other entities in which Borrower and its Subsidiaries (a) have less than a
majority voting interest and (b) do not have the right effectively to veto
"major" decisions of the majority pertaining thereto (including, without
limitation, the acquisition, disposition or financing of assets of such
partnership and/or other entity, the liquidation, or dissolution of such
partnership and/or other entity and the filing of bankruptcy by such partnership
and/or other entity) shall not exceed the lesser of 25 percent of the aggregate
amount included at that time in the Borrowing Base pursuant to clauses (viii)
through (x) or $30,000,000).

         In the event that there exists any uncertainty or ambiguity concerning
the proper classification of any asset or Investment under the foregoing
definition of "Borrowing Base", the determination of the Agent concerning the
proper classification of such asset or Investment shall be determinative.

          "Borrower Tax Credits" is defined in clause (i) of the definition of
Tax Credits.

         "Borrowing Date" means Business Day on which an Advance is made to the
Borrower.

         "Borrowing Notice" is defined in Section 2.11(a) hereof.

         "Business Day" means a day, other than a Saturday, Sunday or holiday,
on which banks are open for business in Chicago, Illinois and, where such term
is used in reference to the selection or determination of the Adjusted LIBOR
Rate, in London, England.

         "Capital Stock" means any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, any
and all equivalent equity ownership interests in a Person which is not a
corporation and any and all warrants or options to purchase any of the
foregoing.

         "Cash Equivalents" shall mean (i) short-term obligations of, or fully
guaranteed by, the United States of America, (ii) commercial paper rated A-1 or
better by S&P's or P-1 or better by Moody's, or (iii) certificates of deposit
issued by and time deposits with commercial banks (whether domestic or foreign)
having capital and surplus in excess of $100,000,000.

         "Change of Control" means that either (i) any one of Jeff Krasnoff,
Steve Saiontz and Stuart Miller cease for any reason to be actively engaged in
the management of LNR, in a senior executive capacity, and any two of Leonard
Miller, Steve Saiontz and Stuart Miller cease for any reason to be members of
the Board of Directors of LNR, or (ii) Leonard Miller and/or members of his
Immediate Family (and/or trusts for his or their benefit) cease to own at least
a majority of the voting power attributable to the Capital Stock of LNR.

                                       7
<PAGE>

         "CMBS" is defined in Recital A.

         "Code" means the Internal Revenue Code of 1986 as amended from time to
time, or any replacement or successor statute, and the regulations promulgated
thereunder from time to time.

         "Commitment" means the obligation of each Lender, subject to the terms
and conditions of this Agreement and in reliance upon the representations and
warranties herein, to make Advances not exceeding in the aggregate the lesser of
(i) the amount set forth beneath its signature below, adjusted for any
assignment pursuant to Article XIII hereof, any increase pursuant to Section
2.1(c) hereof or any reduction pursuant to Section 12.10 hereof, or the amount
stated in any subsequent amendment hereto or in any assignment pursuant to
Article XIII hereof (the "Stated Commitment"), or (ii) such Lender's Percentage
of the Aggregate Commitment.

         "Completed Project" means a Project that satisfies all of the
requirements set forth in clauses (b) and (c) of the definition of Stabilized
Project, but has not achieved the applicable minimum occupancy level set forth
in clause (a) thereof.

         "Consolidated Secured Debt" means as of any date of determination, the
sum of the aggregate principal amount of all Indebtedness of the Borrower and
its Subsidiaries outstanding at such date which is secured by a Lien on any
asset or Capital Stock of Borrower or any Subsidiary, including, without
limitation, loans secured by mortgages, stock or partnership interests.

         "Consolidated Senior Unsecured Debt" means as of any date of
determination, the aggregate principal amount of all Indebtedness of the
Borrower and its Subsidiaries outstanding at such date, including, without
limitation, the undrawn portion of any revolving credit or similar facility,
other than (a) Subordinated Debt and (b) Consolidated Secured Debt.

         "Consolidated Tangible Net Worth" means, as of any date of
determination, the consolidated stockholders' equity of LNR as shown on its
balance sheet as of that date less the stockholders' equity of the Mortgage
Subsidiary and less the aggregate amount of goodwill and other assets subject to
classification as "intangible assets."

         "Consolidated Total Indebtedness" means as of any date of
determination, all Indebtedness of the Borrower and its Subsidiaries outstanding
at such date, determined on a consolidated basis in accordance with GAAP, after
eliminating intercompany items; provided that for purposes of defining
"Consolidated Total Indebtedness" the term "Indebtedness" shall not include
short term obligations consisting of accounts payable within 60 days,
Indebtedness of the Mortgage Subsidiary for which no Borrower or other
Subsidiaries have any personal liability, or the portion of non-recourse
Indebtedness of Subsidiaries of Borrower that is allocable to the owners of
minority interests in such Subsidiaries, based on such owners' percentage
interests in such Subsidiaries, provided that such owners are not Affiliates of
Borrower.

                                       8
<PAGE>

         "Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with all or any of the entities in the Borrower,
are treated as a single employer under Sections 414(b) or 414(c) of the Code.

         "Credit Parties" means each Borrower and each Guarantor.

         "Default" means an event which, with notice or lapse of time or both,
would become an Event of Default.

         "Default Rate" means with respect to any Advance, a rate equal to the
interest rate applicable to such Advance plus two percent per annum.

         "Defaulting Lender" means any Lender which fails or refuses to perform
its obligations under this Agreement within the time period specified for
performance of such obligation, or, if no time frame is specified, if such
failure or refusal continues for a period of five Business Days after written
notice from the Agent; provided that if such Lender cures such failure or
refusal, such Lender shall cease to be a Defaulting Lender.

         "Development Property" means any Property which (a) is under
construction and then treated as an asset under development in accordance with
GAAP, (ii) satisfies the requirements set forth in clauses (b) and (c) of the
definition of Stabilized Project, and (iii) upon completion of the development
thereof in accordance with the plans and specifications therefore, will
constitute a Project.

         "Documentation Agent" is defined in the preamble of this Agreement and
means Fleet National Bank, acting as documentation agent for the Lenders in
connection with the transactions contemplated by this Agreement, and its
successors in such capacity.

         "Dollars" and "$" mean United States Dollars.

         "Duff & Phelps" means Duff & Phelps Credit Rating Company (also known
as Fitch).

         "EBITDA" means, without duplication: (i) the sum of (a) net income, as
reported by the Borrower and its Subsidiaries on a consolidated basis in
accordance with GAAP ("Net Income"), (b) Interest Expense, depreciation,
amortization and income tax (if any) expense, (c) Additional CMBS Interest
Income, and (d) Tax Benefits; minus (ii) the amount by which such net income
from Investment Affiliates for the period in question exceeds cash distributions
received by Borrower or its Subsidiaries from such Investment Affiliates during
that period; and minus (iii) Net Income that arises from reversal of a CMBS
Adjustment that previously resulted in the inclusion in EBITDA of Additional
CMBS Interest Income .

         "Effective Date" means each Borrowing Date and, if no Borrowing Date
has occurred in the preceding calendar month, the first Business Day of each
calendar month.

                                       9
<PAGE>

         "Effective Gross Income" means projected gross income, adjusted for
vacancies and collection losses, but in no event in excess of Gross Revenues.

         "Environmental Laws" means any and all Federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes,
decrees, requirements of any governmental authority having jurisdiction over the
Borrower, its Subsidiaries or Special Investment Affiliates, or their respective
assets, and regulating or imposing liability or standards of conduct concerning
protection of human health or the environment, as now or at any time hereafter
in effect, in each case to the extent the foregoing are applicable to the
operations of the Borrower, any Special Investment Affiliate, or any Subsidiary
or any of their respective Real Estate or other Assets.

         "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and regulations promulgated thereunder from time to time.

         "Event of Default" means any event set forth in Article X hereof.

         "Extension Notice" is defined in Section 2.2(a) hereof.

         "Facility" is defined in Recital B hereof and means the unsecured
revolving credit facility described in Section 2.1 hereof.

         "Facility Amount" is defined in Recital B hereof.

         "Facility Letter of Credit" means a Financial Letter of Credit or
Performance Letter of Credit issued hereunder.

         "Facility Joinder" is defined in Section 2.1(c)(ii) hereof.

         "Facility Letter of Credit Fee" is defined in Section 3.8 hereof.

         "Facility Letter of Credit Obligations" means, as at the time of
determination thereof, all liabilities, whether actual or contingent, of the
Borrower with respect to Facility Letters of Credit, including the sum of (a)
the Reimbursement Obligations and (b) the aggregate undrawn face amount of the
then outstanding Facility Letters of Credit.

         "Federal Funds Effective Rate" means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10 a.m. (Chicago
time) on such day on such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by the Agent in its sole
discretion.

                                       10
<PAGE>

         "Financial Letter of Credit" means any standby Letter of Credit which
represents an irrevocable obligation to the beneficiary on the part of the
Issuing Bank (i) to repay money borrowed by or advanced to or for the account of
the account party or (ii) to make any payment on account of any indebtedness
undertaken by the account party, in the event the account party fails to fulfill
its obligation to the beneficiary.

         "Fitch" means Fitch Investors Service, L.P.

         "Fixed Charges" means, for any period, the sum of (a) Interest Expense
for such period, plus (b) the aggregate amount of regularly scheduled principal
payments of Indebtedness (excluding optional prepayments and balloon principal
payments due on maturity in respect of any Indebtedness) required to be made
during such period by the Borrower or any of its consolidated Subsidiaries
(including, without limitation, principal of Subordinated Debt), plus (c) a
percentage of all regularly scheduled principal payments of Indebtedness
required to be made during such period by any Special Investment Affiliate on
recourse Indebtedness (excluding optional prepayments and balloon principal
payments due on maturity in respect of any Indebtedness) equal to the percentage
of the principal amount of such Indebtedness for which the Borrower or any
consolidated Subsidiary is liable, plus (d) Senior Preferred Stock Expense for
such period, plus (e) and other dividends payable on other preferred stock of
the Borrower and its Subsidiaries for such period.

         "Funded Percentage" means, with respect to any Lender at any time, a
percentage equal to a fraction the numerator of which is the amount of the
Aggregate Commitment actually disbursed and outstanding to Borrower by such
Lender at such time, and the denominator of which is the total amount of the
Aggregate Commitment disbursed and outstanding to Borrower by all of the Lenders
at such time.

         "GAAP" means generally accepted accounting principles in the United
States of America consistent with those utilized in preparing the audited
financial statements of the Borrower required hereunder, and applied
consistently from period to period.

         "Ground Lease" means a legal, valid, binding and enforceable ground
lease that contains customary and reasonably adequate provisions for the
protection of any senior leasehold mortgagee, including, without limitation,
notice rights, extended cure rights and new lease rights, of the types commonly
included in ground leases intended to be eligible for conventional leasehold
mortgage financing in accordance with the prevailing standards therefor in the
commercial lending industry.

         "Gross Revenues" means total revenues, calculated in accordance with
GAAP.

         "Guarantee Obligation" means as to any Person (the "guaranteeing
person"), any obligation (determined without duplication) of the guaranteeing
person (or any other Person [including, without limitation, any bank under any
letter of credit] if the guaranteeing person has issued a reimbursement, counter
indemnity or similar obligation in favor of such other Person) guaranteeing or
in effect guaranteeing any Indebtedness, leases, dividends or other obligations

                                       11
<PAGE>

(the "primary obligations") of any other third Person (the "primary obligor") in
any manner, whether directly or indirectly, including, without limitation, any
obligation of the guaranteeing person, whether or not contingent, (i) to
purchase any such primary obligation or any property constituting direct or
indirect security therefor, (ii) to advance or supply funds (1) for the purchase
or payment of any such primary obligation or (2) to maintain working capital or
equity capital of the primary obligor or otherwise to maintain the net worth or
solvency of the primary obligor, (iii) to purchase property, securities or
services primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligor to make payment of such primary
obligation or (iv) otherwise to assure or hold harmless the owner of any such
primary obligation against loss in respect thereof; provided, however, that the
term Guarantee Obligation shall not include endorsements of instruments for
deposit or collection in the ordinary course of business. The amount of any
Guarantee Obligation of any guaranteeing person shall be deemed to be the
maximum stated amount of the primary obligation relating to such Guarantee
Obligation (or, if less, the maximum stated liability set forth in the
instrument embodying such Guarantee Obligation), provided, however, that in the
absence of any such stated amount or stated liability, the amount of such
Guarantee Obligation shall be such guaranteeing person's maximum reasonably
anticipated liability in respect thereof as reasonably determined by the
Borrower in good faith, subject to the Agent's approval.

         "Guarantor" means each Person that executes and delivers a Guaranty.

         "Guaranty" means the Guaranty to be executed and delivered by each
wholly-owned Subsidiary of a Borrower which is not itself a Borrower or a Pledge
Subsidiary, in the form attached hereto as Exhibit D.

         "Hedging Agreements" means interest rate protection agreements, foreign
currency exchange agreements, commodity purchase or option agreements or other
interest, exchange rate or commodity price hedging agreements.

         "Immediate Family" means, with respect to any natural person, such
person's spouse, children (whether biological or legally adopted) and lineal
descendants (including lineal descendants of legally adopted children of such
person).

         "Indebtedness" of any Person at any date means, without duplication,
(a) all indebtedness of such Person for borrowed money, (b) all obligations of
such Person for the deferred purchase price of property or services (other than
trade liabilities and other accounts payable and accrued expenses incurred in
the ordinary course of business and payable in accordance with customary
practices, which are not 60 days or more past due), to the extent such
obligations constitute indebtedness for the purposes of GAAP, (c) any other
indebtedness of such Person which is evidenced by a note, bond, debenture or
similar instrument, (d) all obligations of such Person under financing leases
and capital leases, (e) all obligations of such Person in respect of acceptances
issued or created for the account of such Person, (f) all Guarantee Obligations
of such Person (excluding in any calculation of consolidated indebtedness of the
Borrower, Guarantee Obligations of the Borrower in respect of primary
obligations of any Subsidiary), (g) all reimbursement obligations of such Person
for letters of credit and other similar contingent

                                       12
<PAGE>

liabilities, (h) all liabilities secured by any Lien (other than Liens for taxes
not yet due and payable) on any property owned by such Person even though such
Person has not assumed or otherwise become liable for the payment thereof, (i)
any repurchase obligation or liability of such Person or any of its Subsidiaries
with respect to accounts or notes receivable sold by such Person or any of its
Subsidiaries, (j) Senior Preferred Stock, (k) such Person's pro rata share of
recourse debt of Special Investment Affiliates and any recourse loans where such
Person is liable as a general partner or otherwise, (l) all obligations to make
advances and contributions to Investment Affiliates, and (m) to the extent not
included in Interest Expense, all obligations under any Hedging Agreements,
whether contingent or otherwise (but excluding the notional amounts thereunder).

         "Insolvency" means insolvency as defined in the United States
Bankruptcy Code, as amended. "Insolvent" when used with respect to a Person,
shall refer to a Person who satisfies the definition of Insolvency.

         "Interest Expense" means all interest expense of the Borrower and its
Subsidiaries determined in accordance with GAAP (including, without limitation,
interest on Subordinated Debt) plus capitalized interest not covered by an
interest reserve from a loan facility.

         "Interest Period" means a LIBOR Interest Period.

         "Investment" means, as to any Person, any loan, advance, extension of
credit, deposit or contribution by such Person to any other Person, or any
investment in, or purchase or other acquisition of, the Capital Stock,
Investment Securities, notes, debentures or other securities of any other Person
made by such Person.

         "Investment Affiliate" means any Person in which the Borrower, directly
or indirectly, has an ownership interest, whose financial results are not
consolidated under GAAP with the financial results of the Borrower on the
consolidated financial statements of the Borrower.

         "Investment Securities" means debt or equity investment instruments
other than Cash Equivalents, residual bonds and interest only bonds, including,
without limitation, commercial paper and CMBS.

         "Issuance Date" is defined in Section 3.4(a)(2) hereof.

         "Issuance Notice" is defined in Section 3.4(c) hereof.

         "Issuing Bank" means, with respect to each Facility Letter of Credit,
the Lender which issues such Facility Letter of Credit. Unless Bank of America
otherwise agrees in writing, Bank of America shall be the sole Issuing Bank.

         "Land Held for Investment" means Properties that are not Qualified
Properties, that satisfy the requirements set forth in clauses (b) and (c) of
the definition of "Stabilized Project" and that are Unencumbered Assets.

                                       13
<PAGE>

         "Land Partnership" means an Investment Affiliate engaged in the
business of acquiring, owning, managing and developing (with site improvements
only) raw land, and selling site-improved land.

         "Lenders" means, collectively, Bank of America and any Person executing
this Agreement in such capacity, and any Person which subsequently executes and
delivers any Facility Joinder or amendment hereto in such capacity and each of
their respective permitted successors and assigns. Where reference is made to
"the Lenders" in any Loan Document it shall be read to mean "all of the
Lenders".

         "Lending Installation" means any office of any Lender authorized to
make loans similar to the Advances described herein.

         "Letter of Credit" of a Person means a letter of credit or similar
instrument which is issued upon the application of such Person or upon which
such Person is an account party or for which such Person is in any way liable.

         "Letter of Credit Collateral Account" is defined in Section 3.9 hereof.

         "Letter of Credit Request" is defined in Section 3.4(a) hereof.

         "Leverage Ratio" means the ratio of Consolidated Total Indebtedness,
excluding obligations that would otherwise be included pursuant to clause (m) of
the definition of "Indebtedness", to Consolidated Tangible Net Worth.

         "LIBOR Advance" means an Advance that bears interest at the Adjusted
LIBOR Rate.

         "LIBOR Interest Period" means, with respect to a LIBOR Advance, a
period of one, two, three or six months (to the extent that periods in excess of
three months are generally available from the Lenders), as selected in advance
by the Borrower.

         "LIBOR Rate" means, with respect to a LIBOR Advance for the relevant
LIBOR Interest Period, the per annum rate of interest, rounded upward if
necessary to the nearest 1/16th of one percent (0.0625), determined by the Agent
to be the rate at which deposits in immediately available funds in U.S. Dollars
would be offered by the Bank of America's London branch to first-class banks in
the London interbank eurodollar market at approximately 11:00 a.m. London time
two Business Days prior to the first day of such LIBOR Interest Period, in the
approximate amount of the relevant LIBOR Advance and having a maturity
approximately equal to such LIBOR Interest Period.

         "Lien" means any mortgage, pledge, hypothecation, deposit arrangement,
preference, priority, security interest, collateral assignment, statutory or
consensual lien, charge, restriction or other encumbrance of any kind
(including, without limitation, any repurchase agreement, any conditional sale
or other title retention agreement or lease in the nature thereof, any filing or

                                       14
<PAGE>

agreement to file a financing statement as debtor under the Uniform Commercial
Code on any property leased to any Person under a lease which is not in the
nature of a conditional sale or title retention agreement, or any subordination
agreement in favor of another Person). For purposes of this Agreement, a Lien on
the Capital Stock of any Person shall be deemed to constitute a Lien on the
assets of said Person.

         "Loan" means, with respect to a Lender, such Lender's portion of any
Advance.

         "Loan Documents" means this Agreement, the Notes, each Guaranty, the
Pledge Agreement and any and all other agreements or instruments required and/or
provided to the Agent or any Lenders hereunder or thereunder, as any of the
foregoing may be amended from time to time.

         "Managing Agent" is defined in the preamble of this Agreement and means
Guaranty Federal Bank, F.S.B., acting as managing agent for the Lenders in
connection with the transactions contemplated by this Agreement, and its
successors in such capacity.

         "Margin Stock" has the meaning ascribed to it in Regulation U of the
Board of Governors of the Federal Reserve System.

         "Market Price Proxy" means, as to any Investment Security for any
fiscal period, an amount equal to the quotient of (i) the cash flow generated by
such Investment Security for such period (including, without limitation, fees
payable to Borrower for serving as special servicer, where the right so to serve
is attributable to such Investment Security), on an annualized basis (if such
period is less than a full fiscal year), divided by (ii) a factor varying with
the investment rating (or absence thereof) of such Investment Security as
follows: (a) for a rating of BB or better by S&P (or an equivalent Moody's
rating or Third Rating), 0.10; (b) for a rating of BB- through B by S&P (or an
equivalent Moody's rating or Third Rating), 0.11; and (c) in the absence of any
rating or for a rating of B- or lower by S&P (or an equivalent Moody's rating or
Third Rating), 0.18 (provided, however, that the factors set forth in the
foregoing clause (ii) shall be subject to adjustment on a quarterly basis to
reflect then prevailing market conditions, as determined by the Agent in its
sole discretion). In the case of any Investment Security rated by both S&P and
Moody's and/or a Third Rating, the lower of the ratings shall govern and
control.

         "Material Adverse Effect" means, with respect to any matter, that such
matter constitutes a Material Adverse Financial Change or may, in the Agent's
judgment, (x) materially and adversely affect the business, properties,
condition or results of operations of the Credit Parties taken as a whole, or
(y) constitute a challenge to the validity or enforceability of any material
provision of any Loan Document against any obligor party thereto.

         "Material Adverse Financial Change" shall be deemed to have occurred if
the Required Lenders determine that a material adverse financial change has
occurred which could prevent timely repayment of any Advance hereunder or
materially impair Borrower's or any other Credit Party's ability to perform its
obligations under any of the Loan Documents.

                                       15
<PAGE>

         "Materials of Environmental Concern" means any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as such
in or under any Environmental Law, including, without limitation, asbestos,
radon, polychlorinated biphenyls and urea-formaldehyde insulation.

         "Maturity Date" means July 14, 2003, subject to extension pursuant to
the terms and conditions of Section 2.2(a) hereof or such earlier date on which
the principal balance of the Facility and all other sums due in connection with
the Facility shall be due as a result of the acceleration of the Facility or
Borrower's termination of the Commitments pursuant to Section 2.2(b) hereof.

         "Monetary Default" means any Default involving Borrower's failure to
pay any of the Obligations when due.

         "Moody's" means Moody's Investors Service, Inc. and its successors.

         "Mortgage Loan" means any Indebtedness of any Person secured by a first
priority Lien on real property, which secured Indebtedness represents a loan,
advance or extension of credit (i) originated and owned by any of Borrower or
its wholly-owned Subsidiaries, or (ii) originated by another Person and
purchased or otherwise acquired in its entirety by any of Borrower or its
wholly-owned Subsidiaries.

         "Mortgage Loan Default" means, as to any Mortgage Loan, any failure of
the obligor(s) (i) to pay any principal when the same becomes due and payable,
(ii) to pay any interest or other amount within 60 days after the same becomes
due and payable or (iii) to observe or perform any other material covenant or
agreement within 60 days after the date such observance or performance becomes
due.

         "Mortgage Subsidiary" means a wholly-owned, single purpose Subsidiary
of Borrower to be formed after the date hereof solely for the purpose of
engaging in the mortgage banking business and incidental activities directly
related thereto, which Mortgage Subsidiary shall, upon formation, become a
Guarantor and deliver a Guaranty of the Obligations.

         "Net Operating Income" means, as to any Property for any fiscal period,
an amount equal to (a) rents and other revenues earned in the ordinary course
from such Property (including proceeds of rent loss insurance), less (b) all
expenses paid or accrued related to the ownership, operation or maintenance of
such Property, excluding capital expenditures, but including, without
limitation, taxes, assessments and the like, insurance, utilities, payroll
costs, maintenance, repair and landscaping expenses, management fees, leasing
commissions and on-site marketing expenses.

         "Note" means (i) the promissory note payable to the order of each
Lender in the amount of such Lender's Stated Commitment in the form attached
hereto as Exhibit B-1 and (ii) the promissory note payable to the order of the
Swingline Lender in the amount of $20,000,000.00 in the form attached hereto as
Exhibit B-2 (collectively, the "Notes").

                                       16
<PAGE>

         "Obligations" means the Advances, the Facility Letter of Credit
Obligations and all accrued and unpaid fees and all other obligations of
Borrower to the Agent or any or all of the Lenders arising under this Agreement
or any of the other Loan Documents.

         "Original Agreement" is defined in Recital C hereof.

         "Other Taxes" is defined in Section 4.6 hereof.

         "Parcel" means each parcel of real property, together with any and all
improvements thereon, owned or leased in whole or in part or operated by the
Borrower, any Subsidiary or Investment Affiliate.

         "Participants" is defined in Section 13.2.1 hereof.

         "PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.

         "Percentage" means, with respect to each Lender, the applicable
percentage of the sum of the Stated Commitments of all Lenders represented by
such Lender's Stated Commitment.

         "Performance Letter of Credit" means any standby Letter of Credit which
represents an irrevocable obligation to the beneficiary on the part of the
Issuing Bank to make payment on account of any default by the account party in
the performance of a nonfinancial or commercial obligation.

         "Permitted Liens" are defined in Section 9.6 hereof.

         "Person" means an individual, a corporation, a limited or general
partnership, an association, a joint venture, a limited liability company or any
other entity or organization, including a governmental or political subdivision
or an agent or instrumentality thereof.

         "Plan" means an employee benefit plan as defined in Section 3(3) of
ERISA, whether or not terminated, as to which the Borrower or any member of the
Controlled Group may have any liability.

         "Pledge Agreement" is defined in Section 8.13 hereof.

         "Pledge Subsidiary" is defined in Section 8.13 hereof.

         "Portfolio/Single Asset Partnership" means an Investment Affiliate
primarily engaged in the business of acquiring, owning, managing and, as
appropriate, liquidating (i) portfolios of real estate related assets and (ii)
single real estate related assets (other than development land held by a Land
Partnership).

                                       17
<PAGE>

         "Project" means any parcel of real property wholly-owned in fee simple
of record by the Borrower, any wholly-owned Subsidiary or any Guarantor, or any
long term leasehold estate in any parcel of real estate wholly-owned by Borrower
or any wholly-owned Subsidiary pursuant to Ground Lease, together with any and
all improvements thereon, which is fully improved for use and operated as a
commercial or industrial property (including, without limitation, multi-family
residential, office, retail and warehouse properties), and with respect to which
a certificate of occupancy or comparable authorization has been issued by the
applicable governmental authority.

         "Property" means each parcel of real property owned in fee simple of
record by Borrower or any Subsidiary, or any long term leasehold estate in any
parcel of real estate owned by Borrower or any Subsidiary pursuant to Ground
Lease, together with any and all improvements thereon.

         "Purchasers" is defined in Section 13.3.1 hereof.

         "Qualified Officer" means, with respect to any entity, the chief
financial officer, chief accounting officer or controller of such entity if it
is a corporation or of such entity's general partner if it is a partnership.

         "Qualified Property" means a Project or Property that is a Stabilized
Project, a Completed Project or a Development Property.

         "Rate Option" means the Adjusted Base Rate or the Adjusted LIBOR Rate.
The Rate Option in effect on any date shall always be the Adjusted Base Rate
unless the Borrower has properly selected the Adjusted LIBOR Rate pursuant to
Section 2.11 hereof.

         "Real Estate" means all Projects, Properties and Parcels.

         "Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to
reserve requirements applicable to member banks of the Federal Reserve System.

         "Reimbursement Obligations" means at any time, the aggregate of the
Obligations of the Borrower to the Lenders, the Issuing Bank and the Agent in
respect of all unreimbursed payments or disbursements made by the Lenders, the
Issuing Bank and the Agent under or in respect of the Facility Letters of
Credit.

         "Reportable Event" means a reportable event as defined in Section 4043
of ERISA and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC by regulation waived the
requirement of Section 4043(a) of ERISA that it be notified within 30 days of
the occurrence of such event, provided that a failure to meet the minimum
funding standard of Section 412 of the Code and of Section 302 of ERISA shall be

                                       18
<PAGE>

a Reportable Event regardless of the issuance of any such waivers in accordance
with either Section 4043(a) of ERISA or Section 412(d) of the Code.

         "Required Lenders" means Lenders in the aggregate having in excess of
66 2/3% of the Aggregate Commitment or, if the Aggregate Commitment has been
terminated, Lenders in the aggregate holding in excess of 66 2/3% of the
aggregate unpaid principal amount of the outstanding Advances and, without
duplication, the outstanding Facility Letter of Credit Obligations.

         "Reserve Requirement" means, with respect to a LIBOR Interest Period,
the maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on Eurocurrency
liabilities.

         "S&P" means Standard & Poor's Ratings Group and its successors.

         "Senior Leverage Ratio" means the ratio of (i) Consolidated Total
Indebtedness, less Subordinated Debt, to (ii) Consolidated Tangible Net Worth.

         "Senior Preferred Stock" means the stated value of any preferred stock
issued by any Borrower which is not typical preferred stock but instead is both
(i) redeemable by the holders thereof on any fixed date or upon the occurrence
of any event and (ii) as to payment of dividends or amounts on liquidation,
either guaranteed by any direct or indirect Subsidiary of such Borrower or
secured by any property of such Borrower or any direct or indirect Subsidiary of
such Borrower.

         "Senior Preferred Stock Expense" means for any period for any Person,
the aggregate dividend payments due to the holders of Senior Preferred Stock of
such Person, whether payable in cash or in kind, and whether or not actually
paid during such period.

         "Solvent" means, as to any Person on a particular date, that such
Person (a) has capital sufficient to carry on its existing business and
transactions and all business and transactions in which it is about to engage,
(b) owns property having a value, both at fair valuation and at present fair
salable value, greater than the amount required to pay its probable liabilities
(including, without limitation, contingencies), (c) does not intend to or
believe that it will incur debts or liabilities beyond its ability to pay the
same as they mature and (d) is not Insolvent.

         "Special Investment Affiliate" means an Investment Affiliate for the
obligations of which any of Borrower or its Subsidiaries has personal liability,
as a general partner or otherwise.

         "Special Purpose Property" means a Project or Property improved
primarily for a specialized single purpose use, such as, for example, a hotel,
parking, golf course, amusement park, restaurant or theater facility.

         "Stabilized Affiliate Project" means any parcel of real property
wholly-owned in fee simple of record by an Investment Affiliate or any long term
leasehold estate in any parcel of real

                                       19
<PAGE>

estate wholly-owned by an Investment Affiliate pursuant to a Ground Lease,
which, in each case, if wholly-owned by Borrower or any wholly-owned Subsidiary
or Guarantor, would be a Stabilized Project.

         "Stabilized Project" means a Project which:

         (a) has achieved the applicable occupancy level set forth in clauses
(i) through (iv) below, pursuant to arm's length leases with unaffiliated
tenants (for purposes of this definition, Lennar Corporation and its
Subsidiaries shall be deemed unaffiliated tenants) which are in possession and
paying rent in accordance with such leases, such occupancy level to be measured,
as of any date of determination, by the rentable square footage of such Project
subject to such leases during the immediately preceding calendar quarter
relative to the total rentable square footage of such Project:

         (i)      80 percent, if such Project is leased primarily for
                  multi-family residential use;

         (ii)     75 percent, if such Project is leased primarily for either
                  retail use or industrial use;

         (iii)    70 percent, if such Project is leased primarily for office
                  use; and

         (iv)     if such Project is leased primarily for a use other than one
                  of those specified in clauses (i) through (iii) above, that
                  level of occupancy that Borrower demonstrates to the Agent's
                  satisfaction to be the average level of occupancy for projects
                  of the same type as such Project within the real estate market
                  in which such Project is located;

         (b) is not the subject of any material architectural/engineering issue
or any material Environmental Law issue, as evidenced by a certification of
Borrower, and

         (c) is in material compliance with the applicable representations and
warranties in Article VI below. Notwithstanding anything to the contrary
contained in this Agreement, if the Agent determines that any Project or
Property theretofore identified by Borrower as a Qualified Property may be the
subject of a material architectural/engineering issue or a material
Environmental Law issue, the Agent may (i) require Borrower to furnish a current
detailed environmental assessment or architectural/engineering assessment, as
the case may be, and, if applicable, a written estimate of any remediation costs
from a qualified architect, engineer or contractor acceptable to the Agent, in
which event Borrower shall promptly obtain and furnish the same at its own
expense, and (ii) exclude any such Project or Property from the Qualified
Properties at its election.

          "Stated Commitment" is defined in clause (i) of the definition of
Commitment.

                                       20
<PAGE>

         "Strategic Investment" means (i) an Investment by one of Borrower or
one of its wholly-owned Subsidiaries in a Subsidiary or Investment Affiliate
engaged in a real estate related businesses, such as, without limitation,
providing management, financing (including, without limitation, making mezzanine
loans), development, credit enhancement and securitization services for real
estate, and (ii) a passive Investment by one of Borrower or one of its
wholly-owned Subsidiaries in a Subsidiary or an Investment Affiliate owning real
estate related assets.

         "Subordinated Debt" means Indebtedness of the Borrower and its
Subsidiaries that is contractually subordinated in right of payment and
otherwise to the Indebtedness under the Loan Documents, such subordination to be
on terms acceptable to the Required Lenders.

         "Subsidiary" means as to any Person, a corporation, partnership or
other entity of which shares of stock or other ownership interests having
ordinary voting power (other than stock or such other ownership interests having
such power only by reason of the happening of a contingency) to elect a majority
of the board of directors or other managers of such corporation, partnership or
other entity are at the time owned, or the management of which is otherwise
controlled, directly or indirectly through one or more intermediaries, or both,
by such Person, and provided such corporation, partnership or other entity is
consolidated with such Person for financial reporting purposes under GAAP.

         "Subsidiary Joinder" is defined in Section 8.13 hereof.

         "Swingline Advances" means, as of any date, collectively, all Swingline
Loans then outstanding under this Facility.

         "Swingline Commitment" means the obligation of the Swingline Lender to
make Swingline Loans not exceeding $20,000,000.

         "Swingline Lender" means Bank of America, in its capacity as a Lender.

         "Swingline Loan" means a Loan made by the Swingline Lender under the
special availability provisions described in Sections 2.16 hereof.

         "Syndication Agent" is defined in the preamble of this Agreement and
means U.S. Bank, National Association, acting as syndication agent for the
Lenders in connection with the transactions contemplated by this Agreement, and
its successors in such capacity.

         "Tax Benefits" means, for any period, the sum of: (i) the aggregate
dollar amount of all Borrower Tax Credits which are properly applied by Borrower
to reduce the provision for Federal income taxes on the consolidated statement
of earnings prepared for Borrower and its Subsidiaries in accordance with GAAP
for such period; provided, however, that Tax Benefits computed for any period
pursuant to this clause (i) shall not exceed the taxable income of Borrower and
its Subsidiaries for such period; and (ii) the product of (a) the pre-tax loss
generated by the Company in connection with low-income housing projects that
generate Tax Credits, multiplied by (b) the highest marginal tax rate that would
have been applicable to

                                       21
<PAGE>

Borrower for Federal and State income tax purposes, if the Tax Credits and such
pre-tax loss deductions were not available to Borrower.

         "Tax Credits" means (i) low-income housing credits determined under
Section 42 of the Code and the regulations promulgated thereunder ("Section 42")
to which Borrower and its Subsidiaries are entitled under Section 42 ("Borrower
Tax Credits"), and (ii) a percentage of low-income housing credits determined
under Section 42 to which any Investment Affiliate is entitled under Section 42,
which percentage shall equal Borrower's direct or indirect percentage ownership
interest in such Investment Affiliate.

         "Taxes" is defined in Section 4.6 hereof.

         "Termination Notice" is defined in Section 2.2(b) hereof.

         "Third Rating" means a debt rating by Fitch, Duff & Phelps or another
nationally recognized rating agency acceptable to Agent.

         "Total Liabilities" means all Indebtedness plus all other GAAP
liabilities of the Borrower and its Subsidiaries.

         "Transferee" is defined in Section 13.4 hereof.

         "Unencumbered Asset" means any Project or Property which, as of any
date of determination, (a) is not subject to any Liens other than Permitted
Liens of the types described in clauses (i) through (v) of Section 9.6 hereof
and Liens in favor of the Lenders securing this Facility, (b) is not subject to
any agreement (including any agreement governing Indebtedness incurred in order
to finance or refinance the acquisition of such asset) which prohibits or limits
the ability of the Borrower, or its Subsidiaries, as the case may be, to create,
incur, assume or suffer to exist any Lien upon any assets or Capital Stock of
the Borrower or any of its Subsidiaries, and (c) is not subject to any agreement
(including any agreement governing Indebtedness incurred in order to finance or
refinance the acquisition of such asset) which (i) entitles any Person to the
benefit of any Lien (but excluding Liens in favor of Lenders securing this
Facility and other Permitted Liens described in clause (a) above) on any assets
or Capital Stock of the Borrower or any of its Subsidiaries or (ii) would
entitle any Person to the benefit of any Lien (but excluding liens in favor of
Lenders securing this Facility and other Permitted Liens described in clause (a)
above) on such assets or Capital Stock upon the occurrence of any contingency
(including, without limitation, pursuant to an "equal and ratable" clause).
Notwithstanding the foregoing, no Project or Property of a Subsidiary shall be
deemed to be an Unencumbered Asset unless both such Project or Property and all
Capital Stock of such Subsidiary are unencumbered by any Lien (other than a
Permitted Lien described in clause (a) above and Liens in favor of the Lenders
securing this Facility).

         "Unused Fee" is defined in Section 2.7 hereof.

         "Upfront Fee" is defined in Section 2.8(a) hereof.

                                       22
<PAGE>

         The foregoing definitions shall be equally applicable to both the
singular and the plural forms of the defined terms.

         1.2 Financial Standards. All financial and accounting terms used and
not otherwise defined herein shall be construed in accordance with GAAP. All
financial and accounting computations and determinations required of a Person
under this Agreement shall be made, and all financial information required under
this Agreement shall be prepared, in accordance with GAAP, except, in each case,
as otherwise set forth herein.

         1.3 Construction. The parties hereto acknowledge that each of them has
had the benefit of legal counsel of its own choice and has been afforded an
opportunity to review this Agreement with its legal counsel and that this
Agreement shall be construed as if jointly drafted by the parties hereto.

                                   ARTICLE II

                                  THE FACILITY

         2.1 The Facility.

                  (a) Subject to the terms and conditions of this Agreement and
in reliance upon the representations and warranties of Borrower contained
herein, Lenders agree to make Advances through the Agent to Borrower from time
to time prior to the Maturity Date, provided that the making of any such Advance
will not cause the then Allocated Facility Amount to exceed the then-current
Aggregate Commitment. The Advances may be ratable Base Rate Advances, ratable
LIBOR Advances or non-pro rata Swingline Loans. Except as provided in Sections
2.16 and 12.16 hereof, each Lender shall be required to fund only its Percentage
of each such Advance and no Lender will be required to fund any amounts which
when aggregated with such Lender's Percentage of (i) all other Advances then
outstanding, (ii) all Swingline Advances and (iii) all Facility Letter of Credit
Obligations would exceed such Lender's then-current Commitment. The Facility is
a revolving credit facility and, subject to the provisions of this Agreement,
Borrower may request Advances hereunder, repay such Advances and reborrow
Advances at any time prior to the Maturity Date.

                  (b) The Facility created by this Agreement, and the Commitment
of each Lender to lend hereunder, shall terminate on the Maturity Date, unless
sooner terminated in accordance with the terms of this Agreement.

                  (c) In no event shall the Aggregate Commitment exceed the
Facility Amount. The Facility Amount shall be Three Hundred and Twenty Five
Million Dollars ($325,000,000); provided, however, that, so long as no Default
has occurred and is continuing hereunder:

                           (i) For a period of one year after the Agreement
                  Execution Date, the Agent shall use reasonable efforts (or
                  shall cause Banc of America Securities LLC

                                       23
<PAGE>

                  to use reasonable efforts) to cause the Facility Amount (after
                  giving effect to any reduction pursuant to Section 12.10
                  hereof) to be increased to up to Three Hundred Fifty Million
                  Dollars ($350,000,000) by securing one or more commitments to
                  join the Facility from one or more financial institutions
                  reasonably acceptable to the Borrower and the Agent, and/or by
                  securing increases in the Stated Commitments of one or more of
                  the Lenders, in the aggregate amount for all such commitments
                  and increases of up to Twenty Five Million Dollars
                  ($25,000,000) plus the amount of any reduction pursuant to
                  Section 12.10 hereof.

                           (ii) In the event that any such commitment(s) to join
                  the Facility is so secured on or before the first anniversary
                  of the Agreement Execution Date, each financial institution
                  that has made such a commitment shall become a party to this
                  Agreement by executing and delivering to the Agent, the
                  Borrower and each Lender a joinder agreement, in form and
                  content reasonably satisfactory to the Agent and the Borrower
                  (a "Facility Joinder"), pursuant to which such financial
                  institution agrees to become a Lender hereunder and under the
                  other Loan Documents and assumes all of the obligations of a
                  Lender thereunder, whereupon, effective as of the date of such
                  execution and delivery:

                                    (v) each such financial institution shall
                           become a Lender party to this Agreement for all
                           purposes hereof, entitled to all of the rights and
                           subject to all of the obligations of a Lender
                           hereunder,

                                    (w) the Stated Commitment of each such
                           financial institution shall be the amount committed
                           by it as set forth in such Facility Joinder (which
                           amount shall not cause the Facility Amount to exceed
                           Three Hundred Fifty Million Dollars ($350,000,000),
                           after giving effect to all other increases in the
                           Facility Amount pursuant to this subparagraph (c),
                           and after giving effect to any reduction pursuant to
                           Section 12.10 hereof),

                                    (x) Borrower shall immediately pay the
                           portion of the Upfront Fee allocable to each such
                           financial institution in accordance with Section
                           2.8(a) hereof,

                                    (y) each such financial institution shall
                           immediately purchase from each party hereto that was
                           a Lender immediately prior to such effective date,
                           and pay to each such Lender at par, such financial
                           institution's Percentage of each such Lender's Loans
                           then outstanding hereunder (including, without
                           limitation, interest then accrued and unpaid
                           thereon), and

                                    (z) the Borrower shall immediately deliver
                           to each such financial institution a Note in the form
                           attached hereto as Exhibit B-1 in the amount of such
                           financial institution's Stated Commitment.

                                       24
<PAGE>

                           (iii) In the event that any such increase(s) to any
                  Stated Commitment(s) is secured on or before the first
                  anniversary of the Agreement Execution Date, each Lender that
                  has committed to such an increase shall execute and deliver to
                  the Agent an addendum to this Agreement, in form and content
                  satisfactory to the Agent and the Borrower, evidencing such
                  increase, whereupon, effective as of the date of such
                  execution and delivery,

                                    (w) the Stated Commitment of such Lender
                           shall be increased by the amount set forth in such
                           addendum (which amount shall not cause the Facility
                           Amount to exceed Three Hundred Fifty Million Dollars
                           ($350,000,000), after giving effect to all other
                           increases in the Facility Amount pursuant to this
                           subparagraph (c), and after giving effect to any
                           reduction pursuant to Section 12.10 hereof),

                                    (x) the Borrower shall immediately pay the
                           portion of the Upfront Fee allocable to each such
                           Lender in accordance with Section 2.8(a) hereof in
                           respect of the increase in its Stated Commitment,

                                    (y) each such Lender shall immediately
                           purchase from each other Lender that was a party
                           hereto immediately prior to such effective date, and
                           pay to each such other Lender at par, a percentage of
                           each such other Lender's Loans then outstanding
                           hereunder (including, without limitation, interest
                           then accrued and unpaid thereon), which percentage
                           shall equal the increase in such purchasing Lender's
                           Percentage resulting from the increase in its Stated
                           Commitment, and

                                    (z) the Borrower shall immediately deliver
                           to each such Lender a replacement Note in the form
                           attached hereto as Exhibit B-1 in the amount of such
                           financial institution's Stated Commitment, upon
                           receipt of which such Lender shall surrender its
                           original Note marked "Replaced."

         2.2 Principal Payments, Extension Option and Early Termination Option.

                  (a) Any outstanding Advances and all other unpaid Obligations
shall be paid in full by the Borrower on the Maturity Date. The Maturity Date
can be extended for a single extension period of one year upon notice to the
Agent not later than 60 days prior to the Maturity Date and not earlier than 90
days prior to the Maturity Date (an "Extension Notice"), if, but only if (i) no
Default has occurred and is continuing at the time of the Extension Notice or at
the time of the Maturity Date and (ii) on or before the Maturity Date, Borrower
pays an extension fee to the Agent for the account of the Lenders in an amount
equal to the product of the sum of the Stated Commitments of the Lenders
multiplied by 0.0025. If the Borrower timely gives an Extension Notice, the
Agent shall promptly notify the Lenders of the extension of the Maturity Date,
subject to satisfaction of the requirements set forth in clauses (i) and (ii)
above.

                                       25
<PAGE>

                   (b) Borrower may terminate the Commitments of the Lenders
upon notice to the Agent not later than 60 days prior to the effective date of
such termination and not more than 90 days prior thereto (a "Termination
Notice"), if, but only if, (i) no Default has occurred and is continuing at the
time of the Termination Notice or at the time of the effective date of such
termination specified therein, and (ii) Borrower pays all of the Obligations in
full on or before such effective date, including, without limitation, all break
funding costs and all fees and other amounts accrued but not yet payable
hereunder as of the date of such payment. If the Borrower timely gives a
Termination Notice, the Agent shall promptly notify the Lenders of the
termination of their Commitments on the date specified in the Termination
Notice, subject to satisfaction of the requirements set forth in clauses (i) and
(ii) above.

         2.3 Requests for Advances: Responsibility for Advances. Ratable
Advances funded by the Lenders shall be made available to Borrower by Agent in
accordance with Section 2.1(a) and Section 2. 11(a) hereof. The obligation of
each Lender to fund its Percentage of each ratable Advance shall be several and
not joint or joint and several.

         2.4 Evidence of Credit Extensions. The Advances of each Lender
outstanding at any time shall be evidenced by the Notes. Each Note executed by
the Borrower shall be in a principal amount equal to each Lender's Stated
Commitment. Each Lender shall record Advances and principal payments thereof on
the schedule attached to its Note or, at its option, in its records, and each
Lender's record thereof shall be conclusive absent Borrower furnishing to such
Lender conclusive and irrefutable evidence of an error made by such Lender with
respect to that Lender's records. Notwithstanding the foregoing, the failure to
make, or an error in making, a notation with respect to any Advance shall not
limit or otherwise affect the obligations of Borrower hereunder or under the
Notes to pay the amount actually owed by Borrower to Lenders.

         2.5 Ratable and Non-Pro Rata Loans. Each Advance hereunder shall
consist of Loans made from the several Lenders ratably in proportion to their
Percentages, except for Swingline Loans which shall be made by the Swingline
Lender in accordance with Section 2.16. The ratable Advances may be Base Rate
Advances, LIBOR Advances or a combination thereof selected by the Borrower in
accordance with Sections 2.10 and 2.11.

         2.6 Applicable Margins. The Applicable Margin (if any) over the then
Base Rate or LIBOR Rate, as applicable to the Advance(s) in question, shall vary
from time to time in accordance with Borrower's Leverage Ratio. The Applicable
Margin shall be adjusted effective as of the next Business Day following any
change in Borrower's Leverage Ratio as established by Borrower to Agent's
satisfaction. The Leverage Ratios and the Applicable Margins are set forth in
the following table:

                                       26
<PAGE>

<TABLE>
<CAPTION>
------------------------------ --------------------------- ---------------------------------- ------------------------
                                       Applicable
                                      Margin-LIBOR           Applicable Margin-Base Rate
       Leverage Ratio                   Advances                       Advances                     Unused Fee
------------------------------ --------------------------- ---------------------------------- ------------------------
<S>                                   <C>                            <C>                           <C>
less than 1.5:1                       1.75 percent                   0    percent                  0.25 percent
------------------------------ --------------------------- ---------------------------------- ------------------------
1.5:1 or greater but less             2.0  percent                   0.05 percent                  0.3  percent
than 2.0:1
------------------------------ --------------------------- ---------------------------------- ------------------------
2.0:1 or greater but less             2.25 percent                   0.1  percent                  0.35 percent
than 2.25:1
------------------------------ --------------------------- ---------------------------------- ------------------------
2.25:1 or greater but less            2.50 percent                   0.15 percent                  0.4  percent
than 2.4:1
------------------------------ --------------------------- ---------------------------------- ------------------------
2.4:1 or greater but less             2.75 percent                   0.2  percent                  0.45 percent
than 2.6:1
------------------------------ --------------------------- ---------------------------------- ------------------------
2.6:1 or greater but not to           3.25 percent                   0.25 percent                  0.5  percent
exceed 2.75:1
------------------------------ --------------------------- ---------------------------------- ------------------------
</TABLE>

         2.7 Unused Commitment Fee. The Borrower agrees to pay to the Agent for
the account of each Lender an unused commitment fee (the "Unused Fee") from the
Agreement Execution Date to and including the Maturity Date, calculated at the
applicable rate per annum set forth in the table appearing in Section 2.6 hereof
on the daily unborrowed portion of such Lender's Stated Commitment (which is
equal to the difference between (a) such Lender's Stated Commitment on such day
and (b) the then outstanding Loans owed to such Lender plus the Lender's
Percentage of any outstanding and undrawn Facility Letters of Credit) payable
quarterly in arrears on the first day of each calendar quarter hereafter and on
the Maturity Date. Amounts outstanding under the Swingline Loans shall be
considered part of the available unborrowed portion of the Facility for purposes
of computing the Unused Fee. Notwithstanding the foregoing, all accrued Unused
Fees shall be payable on the effective date of any termination of the
obligations of the Lenders to make Loans hereunder.

         2.8 Other Fees.

                  (a) The Borrower shall pay all fees payable to the Agent
and/or the Lenders pursuant to the Borrower's mandate letter agreement and or
fee letter agreement with the Agent, each dated May 25, 2000, including, without
limitation, a one time fee ("Upfront Fee") payable in accordance with such
letter agreements, to be shared among the Lenders based on their respective
Stated Commitments. The portion of the Upfront Fee allocable to each Lender in
accordance with such letter agreements shall be paid on the date such Lender
becomes a party to this Agreement and, to the extent not previously paid, on the
date of any increase in such Lender's Stated Commitment pursuant to Section
2.1(c) hereof.

                                       27
<PAGE>

                  (b) [Intentionally Omitted]

         2.9 Minimum Amount of Each Advance. Each LIBOR Advance shall be in the
minimum amount of $1,000,000 (and in multiples of $100,000 if in excess
thereof), and each Base Rate Advance shall be in the minimum amount of $500,000
(and in multiples of $100,000 if in excess thereof), provided, however, that any
Base Rate Advance may be in the amount of the unused Aggregate Commitment.

         2.10 Interest.

                  (a) The outstanding principal balance under the Notes shall
bear interest from time to time at a rate per annum equal to:

                           (i) the Adjusted Base Rate; or

                           (ii) at the election of Borrower with respect to all
                  or portions of the Obligations, the Adjusted LIBOR Rate.

                  (b) All interest shall be calculated for actual days elapsed
on the basis of a 360-day year. Interest accrued on each Advance shall be
payable in arrears on the first day of each calendar month, commencing with the
first such date to occur after the date hereof, and the Maturity Date. Interest
shall not be payable for the day of any payment on the amount paid if payment is
received by Agent prior to noon (Chicago time). If any payment of principal or
interest under the Notes shall become due on a day that is not a Business Day,
such payment shall be made on the next succeeding Business Day and, in the case
of a payment of principal, such extension of time shall be included in computing
interest due in connection with such payment.

                                       28
<PAGE>

         2.11 Selection of Rate Options and LIBOR Interest Periods.

                  (a) Borrower, from time to time, may select the Rate Option
and, in the case of each LIBOR Advance, the commencement date (which shall be a
Business Day) and the length of the LIBOR Interest Period applicable to each
LIBOR Advance. Borrower shall give Agent irrevocable notice (a "Borrowing
Notice" not later than 11:00 a.m. (Chicago time) (i) at least one Business Day
prior to a Base Rate Advance, (ii) at least three (3) Business Days prior to a
ratable LIBOR Advance, and (iii) not later than 11:00 a.m. (Chicago time) on the
Borrowing Date for each Swingline Loan, specifying:

                           (i) the Borrowing Date, which shall be a Business
                  Day, of such Advance,

                           (ii) the aggregate amount of such Advance,

                           (iii) the type of Advance selected, and

                           (iv) in the case of each LIBOR Advance, the LIBOR
                  Interest Period applicable thereto.

         The Borrower shall also deliver together with each Borrowing Notice the
compliance certificate required in Section 5.2, if required, and otherwise
comply with the conditions set forth in Section 5.2 for Advances. Agent shall
use reasonable efforts to provide each Lender by facsimile with a copy of each
Borrowing Notice and compliance certificate on the same Business Day it is
received.

         Not later than noon (Chicago time) on each Borrowing Date, each Lender
shall make available its Loan or Loans, in funds immediately available in
Chicago to the Agent. Agent will promptly make the funds so received from the
Lenders available to the Borrower.

                  (b) Agent shall, as soon as practicable after receipt of a
Borrowing Notice requesting a LIBOR Advance, determine the Adjusted LIBOR Rate
applicable to the requested ratable LIBOR Advance and inform Borrower and
Lenders of the same. Each determination of the Adjusted LIBOR Rate by Agent
shall be conclusive and binding upon Borrower in the absence of manifest error.

                  (c) If Borrower shall prepay a LIBOR Advance other than on the
last day of the LIBOR Interest Period applicable thereto, Borrower shall be
responsible to pay all amounts due to Lenders as required by Section 4.4 hereof.

                  (d) As of the end of each LIBOR Interest Period selected for a
ratable LIBOR Advance, the interest rate on the LIBOR Advance will become the
Adjusted Base Rate, unless Borrower has once again selected a LIBOR Interest
Period in accordance with the timing and procedures set forth in Section
2.11(g).

                                       29
<PAGE>

                  (e) The right of Borrower to select the Adjusted LIBOR Rate
for an Advance pursuant to this Agreement is subject to the availability to
Lenders of a similar option. If Agent determines that (i) deposits of Dollars in
an amount approximately equal to the LIBOR Advance for which the Borrower wishes
to select the Adjusted LIBOR Rate are not generally available at such time in
the London interbank eurodollar market, or (ii) the rate at which the deposits
described in subsection (i) herein are being offered will not adequately and
fairly reflect the costs to Lenders of maintaining an Adjusted LIBOR Rate on an
Advance or of funding the same in such market for such LIBOR Interest Period, or
(iii) reasonable means do not exist for determining an Adjusted LIBOR Rate, or
(iv) the Adjusted LIBOR Rate would be in excess of the maximum interest rate
which Borrower may by law pay, then in any of such events, Agent shall so notify
Borrower and Lenders and such Advance shall bear interest at the Adjusted Base
Rate.

                  (f) In no event may Borrower elect a LIBOR Interest Period
which would extend beyond the Maturity Date. In no event may Borrower have more
than seven (7) different LIBOR Interest Periods for LIBOR Advances outstanding
at any one time.

                  (g) Conversion and Continuation.

                           (i) Borrower may elect from time to time, subject to
                  the other provisions of this Section 2.11, to convert all or
                  any part of a ratable Advance into any other type of Advance;
                  provided that any conversion of a ratable LIBOR Advance shall
                  be made on, and only on, the last day of the LIBOR Interest
                  Period applicable thereto.

                           (ii) Base Rate Advances shall continue as Base Rate
                  Advances unless and until such Base Rate Advances are
                  converted into ratable LIBOR Advances pursuant to a
                  Conversion/Continuation Notice from Borrower in accordance
                  with Section 2.11(g)(iv). Ratable LIBOR Advances shall
                  continue until the end of the then applicable LIBOR Interest
                  Period therefor, at which time each such Advance shall be
                  automatically converted into an Base Rate Advance unless the
                  Borrower shall have given the Agent a Conversion/Continuation
                  Notice in accordance with Section 2.11(g)(iv) requesting that,
                  at the end of such LIBOR Interest Period, such Advance
                  continue as an Advance of such type for an additional LIBOR
                  Interest Period of the same or a different duration.

                           (iii) Notwithstanding anything to the contrary
                  contained in this Section 2, no Advance may be converted into
                  a LIBOR Advance or continued (following the end of a LIBOR
                  Interest Period) as a LIBOR Advance when any Monetary Default
                  or Event of Default has occurred and is continuing.

                           (iv) The Borrower shall give the Agent irrevocable
                  notice (a "Conversion/Continuation Notice") of each conversion
                  of an Advance or continuation of a LIBOR Advance not later
                  than 11:00 a.m. (Chicago time) on the Business Day immediately
                  preceding the date of the requested conversion, in the

                                       30
<PAGE>

                  case of a conversion into a Base Rate Advance, or 11:00 a.m.
                  (Chicago time) at least three (3) Business Days prior to the
                  date of the requested conversion or continuation, in the case
                  of a conversion into or continuation of a ratable LIBOR
                  Advance, specifying: (1) the requested date (which shall be a
                  Business Day) of such conversion or continuation; (2) the
                  amount and type of the Advance to be converted or continued;
                  and (3) the amounts and type(s) of Advance(s) into which such
                  Advance is to be converted or continued and, in the case of a
                  conversion into or continuation of a ratable LIBOR Advance,
                  the duration of the LIBOR Interest Period applicable thereto.

         2.12 Method of Payment. All payments of the Obligations hereunder shall
be made, without set-off, deduction, or counterclaim, in immediately available
funds by wire transfer to Agent's account designated in writing from time to
time by notice to Borrower or, in the absence of such notice, to Agent at its
address specified herein, or at any other Lending Installation of Agent
specified in writing by Agent to Borrower, by noon (Chicago time) on the date
when due and shall be applied ratably by Agent among the Lenders, except as
otherwise provided herein. Each payment delivered to Agent for the account of
any Lender shall be delivered promptly by Agent to such Lender in the same type
of funds that Agent received at its address specified herein or at any Lending
Installation specified in a notice received by Agent from such Lender. All
moneys actually received by the Agent in readily available funds for the account
of any Lender or Lenders prior to noon (Chicago time) on any Business Day which
are not remitted to such Lender or Lenders on the same Business Day, and all
such moneys actually received by the Agent in readily available funds after noon
(Chicago time) on any Business Day which are not remitted to such Lender or
Lenders on the following Business Day, shall bear interest at the Federal Funds
Effective Rate, payable by Agent upon written demand, from the Business Day of
such actual receipt prior to noon (Chicago time), or the Business Day following
the Business Day of such actual receipt after noon (Chicago time), as the case
may be, until the Business Day on which such funds are remitted to the Lender or
Lenders entitled to receive the same. If Agent shall not have received payment
as provided above, Agent is hereby authorized to charge any accounts of Borrower
maintained with Bank of America for each payment of principal, interest and fees
as it becomes due hereunder; provided, however, that Agent shall first exhaust
any funds on deposit in Bank of America's Account No. 1420804858 with Bank of
America before having recourse to any other such accounts.

         2.13 Default. Notwithstanding the foregoing and notwithstanding Section
3.7(c) hereof to the contrary, during the continuance of a Monetary Default, any
other material Default or any Event of Default, Borrower shall not have the
right to request a LIBOR Advance, continue or select a new LIBOR Interest Period
for an existing ratable LIBOR Advance, convert any Base Rate Advance to a
ratable LIBOR Advance or request (or be deemed to request) a Base Rate Advance
to satisfy any Reimbursement Obligations with respect to Facility Letter of
Credit. During the continuance of a Monetary Default, any other material
Default, or any Event of Default, outstanding Advances shall bear interest at
the applicable Default Rates until such Monetary Default, other material Default
or Event of Default ceases to exist or the Obligations are paid in full.

                                       31
<PAGE>

         2.14 Lending Installations. Each Lender may book its Loans at any
Lending Installation selected by such Lender and may change its Lending
Installation from time to time. All terms of this Agreement shall apply to any
such Lending Installation and the Notes shall be deemed held by each Lender for
the benefit of such Lending Installation. Each Lender may, by written notice to
the Agent and Borrower, designate a Lending Installation through which Loans
will be made by it and for whose account payments are to be made.

         2.15 Non-Receipt of Funds by Agent. Unless Borrower or a Lender, as the
case may be, has notified Agent prior to the date on which it is scheduled to
make payment to Agent of (i) in the case of a Lender, an Advance, or (ii) in the
case of Borrower, a payment of principal, interest or fees to the Agent for the
account of the Agent or of any or all of the Lenders, that it does not intend to
make such payment (which notice shall not affect the obligations of Borrower or
any Lender, as the case may be, hereunder), and such notice has been received by
Agent, Agent may assume that such payment has been or will be made when due.
Agent may, but shall not be obligated to, make the amount of such payment
available to the intended recipient in reliance upon such assumption. If such
Lender or Borrower, as the case may be, has not in fact made such payment to
Agent, the recipient of such payment shall, on demand by Agent, repay to Agent
the amount so made available together with interest thereon in respect of each
day during the period commencing on the date such amount was so made available
by Agent until the date Agent recovers such amount at a rate per annum equal to
(i) in the case of payment by a Lender, the Federal Funds Effective Rate (as
determined by Agent) for such day or (ii) in the case of payment by Borrower,
the interest rate applicable to the relevant Advance.

         2.16 Swingline Loans. In addition to the other options available to
Borrower hereunder, the amount of the Swingline Commitment shall be available
for Swingline Loans subject to the following terms and conditions. All of the
conditions set forth in Section 5.2 hereof shall have been fulfilled for each
Swingline Loan. Swingline Loans shall be made available for same day borrowings
provided that notice is given in accordance with Section 2.11 hereof. All
Swingline Loans shall bear interest at the Adjusted Base Rate and shall be
deemed to be Base Rate Advances. In no event shall the Swingline Lender be
required to fund a Swingline Loan if it would increase the total aggregate
outstanding Loans by Swingline Lender hereunder plus its Percentage of Facility
Letter of Credit Obligations to an amount in excess of its Commitment. Upon
request of the Swingline Lender made to all the Lenders, each Lender irrevocably
agrees to purchase its Percentage of any Swingline Loan made by the Swingline
Lender regardless of whether the conditions for disbursement are satisfied at
the time of such purchase, including the existence of an Event of Default
hereunder, provided that no Lender shall be required to have total outstanding
Loans plus its Percentage of Facility Letters of Credit Obligations in an amount
greater than its Commitment; and provided further that a Swingline Loan
disbursed by the Swingline Lender shall not be deemed to be a Swingline Loan for
purposes of this sentence if the Swingline Lender shall have received written
notice from any Lender on or before the Business Day prior to the date of such
disbursement that one or more of said disbursement conditions is not then
satisfied, and in the event the Swingline Lender receives such a notice it shall
have no further obligation to advance any Swingline Loan until such notice is
withdrawn by that Lender or the Swingline Lender receives notice from the Agent
that such disbursement condition has been effectively fulfilled or waived in
accordance with the provisions of this Agreement. Such

                                       32
<PAGE>

purchase shall take place on the date of the request by Swingline Lender so long
as such request is made by noon (Chicago time), otherwise on the next Business
Day following such request. All requests for purchase shall be in writing. From
and after the date it is so purchased, each such Swingline Loan shall, to the
extent purchased, (i) be treated as a Loan made by the purchasing Lenders and
not by the selling Lender for all purposes under this Agreement and the payment
of the purchase price by a Lender shall be deemed to be the making of a Loan by
such Lender and shall constitute outstanding principal under such Lender's Note,
and (ii) no longer be considered a Swingline Loan, except that all interest
accruing on or attributable to such Swingline Loan for the period prior to the
date of such purchase shall be paid when due by the Borrower to the Agent for
the benefit of the Swingline Lender, but shall be considered a Base Rate Advance
by each such Lender and all interest accruing on or attributable to such Loans
for the period from and after the date of such purchase shall be paid when due
by the Borrower to the Agent for the benefit of the purchasing Lenders. If prior
to purchasing its Percentage of a Swingline Loan one of the events described in
Section 10.10 shall have occurred and such event prevents the consummation of
the purchase contemplated by the preceding provisions, each Lender will purchase
an undivided participating interest in the outstanding Swingline Loan in an
amount equal to its Percentage of such Swingline Loan. From and after the date
of each Lender's purchase of its participating interest in a Swingline Loan, if
the Swingline Lender receives any payment on account thereof, the Swingline
Lender will distribute to such Lender its participating interest in such amount
(appropriately adjusted, in the case of interest payments, to reflect the period
of time during which such Lender's participating interest was outstanding and
funded); provided, however, that in the event that such payment was received by
the Swingline Lender and is required to be returned to the Borrower, each Lender
will return to the Swingline Lender any portion thereof previously distributed
by the Swingline Lender to it. If any Lender fails to so purchase its Percentage
of any Swingline Loan, such Lender shall be deemed to be a Defaulting Lender
hereunder. No Swingline Loan shall be outstanding for more than five (5)
Business Days at a time.

         2.17 Application of Moneys Received. All moneys collected or received
by the Agent on account of the Facility directly or indirectly, shall be applied
in the following order of priority:

                           (i) to the payment of all expenses then due and
                  payable by Borrower hereunder, including, without limitation,
                  costs incurred in the collection of such moneys;

                           (ii) to the reimbursement of any yield protection due
                  to any of the Lenders in accordance with Section 4.1;

                           (iii) to the payment of all indemnity obligations
                  then due and payable by Borrower hereunder;

                           (iv) to the payment of all fees then due to the
                  Agent;

                           (v) to the payment of any fee due pursuant to Section
                  3.8(b) in connection with the issuance of a Facility Letter of
                  Credit to the Issuing Bank, to

                                       33
<PAGE>

                  the payment of the Unused Fee, Upfront Fee and Facility Letter
                  of Credit Fee to the Lenders, if then due, and to the payment
                  of all fees due hereunder;

                           (vi) to the payment of the full amount of interest
                  and principal on the Swingline Loans;

                           (vii) first to interest until paid in full and then
                  to principal for all Lenders (other than Defaulting Lenders)
                  in accordance with the respective Funded Percentages of the
                  Lenders;

                           (viii) any other sums due to the Agent or any Lender
                  under any of the Loan Documents; and

                           (ix) to the payment of any sums due to each
                  Defaulting Lender as their respective Percentages appear
                  (provided that Agent shall have the right to set-off against
                  such sums any amounts due from such Defaulting Lender).

         2.18 Transitional Provisions. All of the Obligations and Facility
Letters of Credit arising or issued and outstanding immediately prior to the
Agreement Execution Date under the Original Agreement shall, as of the Agreement
Execution Date, automatically become and be deemed to be Obligations and
Facility Letters of Credit arising or issued and outstanding under this
Agreement, and each of the Lenders under this Agreement shall immediately
purchase from each lender under the Original Agreement that is not a Lender
under this Agreement, and pay to each such former lender at par, such purchasing
Lender's Percentage of each such former lender's Loans then outstanding
hereunder (including, without limitation, interest then accrued and unpaid
thereon).

                                   ARTICLE III

                        THE LETTER OF CREDIT SUBFACILITY

         3.1 Obligation to Issue. Subject to the terms and conditions of this
Agreement and in reliance upon the representations and warranties of the
Borrower herein set forth, the Issuing Bank hereby agrees to issue for the
account of Borrower one or more Facility Letters of Credit in accordance with
this Article III, from time to time during the period commencing on the
Agreement Execution Date and ending on a date one Business Day prior to the
Maturity Date.

         3.2 Types and Amounts. The Issuing Bank shall not, without the consent
of the Required Lenders, in the case of subparagraphs (i), (iii) and (iv) below,
and without the consent of all Lenders, in the case of subparagraph (ii) below:

                           (i) issue any Facility Letter of Credit if the
                  aggregate maximum amount then available for drawing under
                  Letters of Credit issued by such Issuing Bank, after giving
                  effect to the Facility Letter of Credit requested hereunder,
                  shall exceed any limit imposed by law or regulation upon such
                  Issuing Bank;

                                       34
<PAGE>

                           (ii) issue any Facility Letter of Credit if, after
                  giving effect thereto, either (1) the then applicable
                  Allocated Facility Amount would exceed the then current
                  Aggregate Commitment, or (2) the Facility Letter of Credit
                  Obligations would exceed $75,000,000;

                           (iii) issue any Facility Letter of Credit having an
                  expiration date, or containing an extension provision to
                  extend such date, to a date which is after the Business Day
                  immediately preceding the Maturity Date; provided, however,
                  that, subject to the other applicable terms and conditions
                  hereof, the Issuing Bank may issue Facility Letters of Credit
                  in an aggregate face amount not exceeding $30,000,000 and
                  having expiration dates, or containing extension provisions to
                  extend such dates, to dates which are within twelve (12)
                  months after the Maturity Date; or

                           (iv) issue any Facility Letter of Credit having an
                  expiration date, or containing an extension provision to
                  extend such date, to a date which is more than twelve (12)
                  months after the date of its issuance.

         3.3 Conditions. In addition to being subject to the satisfaction of the
conditions contained in Article V hereof, the obligation of the Issuing Bank to
issue any Facility Letter of Credit is subject to the satisfaction in full of
the following conditions:

                           (i) the Borrower shall have delivered to the Issuing
                  Bank at such times and in such manner as the Issuing Bank may
                  prescribe such documents and materials (including, without
                  limitation, an application and reimbursement agreement on
                  Issuing Bank's standard forms) as the Issuing Bank may require
                  (it being understood that if any inconsistency exists between
                  such documents and the Loan Documents, the terms of the Loan
                  Documents shall control) and the proposed Facility Letter of
                  Credit shall be reasonably satisfactory to the Issuing Bank as
                  to form and content;

                           (ii) as of the date of issuance, no order, judgment
                  or decree of any court, arbitrator or governmental authority
                  shall purport by its terms to enjoin or restrain the Issuing
                  Bank from issuing the requested Facility Letter of Credit and
                  no law, rule or regulation applicable to the Issuing Bank and
                  no request or directive (whether or not having the force of
                  law) from any governmental authority with jurisdiction over
                  the Issuing Bank shall prohibit or request that the Issuing
                  Bank refrain from the issuance of Letters of Credit generally
                  or the issuance of the requested Facility Letter of Credit in
                  particular; and

                           (iii) there shall not exist any Default or Event of
                  Default.

                                       35
<PAGE>

         3.4 Procedure for Issuance of Facility Letters of Credit.

                  (a) Borrower shall give the Issuing Bank and the Agent at
least three (3) Business Days' prior written notice of any requested issuance of
a Facility Letter of Credit under this Agreement (a "Letter of Credit Request"),
except that, in lieu of such written notice, the Borrower may give the Issuing
Bank and the Agent telephonic notice of such request if confirmed in writing by
delivery to the Issuing Bank and the Agent (i) immediately a telecopy of the
written notice required hereunder which has been signed by an authorized
officer, and (ii) promptly (but in no event later than the requested date of
issuance) of the written notice required hereunder containing the original
signature of an authorized officer; such notice shall be irrevocable and shall
specify:

                           (i) the stated amount of the Facility Letter of
                  Credit requested (which stated amount shall not be less than
                  $10,000);

                           (ii) the effective date (which day shall be a
                  Business Day) of issuance of such requested Facility Letter of
                  Credit (the "Issuance Date");

                           (iii) the date on which such requested Facility
                  Letter of Credit is to expire;

                           (iv) the purpose for which such Facility Letter of
                  Credit is to be issued;

                           (v) the full name and address of the Person for whose
                  benefit the requested Facility Letter of Credit is to be
                  issued; and

                           (vi) any special language required to be included in
                  the Facility Letter of Credit.

At the time such request is made, the Borrower shall also provide the Agent and
the Issuing Bank with a copy of any particular form on which Borrower is
requesting that the Facility Letter of Credit be issued. Such notice, to be
effective, must be received by such Issuing Bank and the Agent not later than
noon (Chicago time) on the last Business Day on which notice can be given under
this Section 3.4(a).

                  (b) Subject to the terms and conditions of this Article III
and provided that the applicable conditions set forth in Article V hereof have
been satisfied, the Issuing Bank shall, on the Issuance Date, issue a Facility
Letter of Credit on behalf of the Borrower in accordance with the Letter of
Credit Request and the Issuing Bank's usual and customary business practices
unless the Issuing Bank has actually received (i) written notice from the
Borrower specifically revoking the Letter of Credit Request with respect to such
Facility Letter of Credit, (ii) written notice from a Lender, which complies
with the provisions of Section 3.6(a), or (iii) written or telephonic notice
from the Agent stating that the issuance of such Facility Letter of Credit would
violate Section 3.2.

                                       36
<PAGE>

                  (c) The Issuing Bank shall give the Agent (who shall promptly
notify Lenders) and the Borrower written or telecopy notice, or telephonic
notice confirmed promptly thereafter in writing, of the issuance of a Facility
Letter of Credit (the "Issuance Notice").

                  (d) The Issuing Bank shall not extend or amend any Facility
Letter of Credit unless the requirements of this Section 3.4 are met as though a
new Facility Letter of Credit was being requested and issued.

Section 3.5 Reimbursement Obligations: Duties of Issuing Bank.

                  (a) The Issuing Bank shall promptly notify the Borrower and
the Agent (who shall promptly notify Lenders) of any draw under a Facility
Letter of Credit. Any such draw shall immediately be reimbursed (by Advances or
otherwise) in accordance with Section 3.7 hereof.

                  (b) The Borrower and each Lender irrevocably authorizes the
Issuing Bank to honor draws on each Facility Letter of Credit by the beneficiary
thereof in accordance with its terms. Any action taken or omitted to be taken by
the Issuing Bank under or in connection with any Facility Letter of Credit, if
taken or omitted in the absence of willful misconduct or gross negligence, shall
not (i) put the Issuing Bank under any resulting liability to Borrower or any
Lender, (ii) relieve Borrower of any of its obligations hereunder to the Issuing
Bank or the Lenders or (iii) provided that such Lender has not given a notice
contemplated by Section 3.6(a) that continues in full force and effect, relieve
any Lender of its obligations hereunder to the Issuing Bank. In determining
whether to pay under any Facility Letter of Credit, the Issuing Bank shall have
no obligation relative to the Lenders or Borrower other than to confirm that any
documents required to be delivered under such Letter of Credit appear to have
been delivered, and that they appear to comply on their face with the
requirements of such Letter of Credit. Without limiting the generality of the
foregoing, the Agent and the Issuing Bank shall be entitled to rely, and shall
be fully protected in relying upon, any Facility Letter of Credit, draft,
writing, resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, telex or teletype message, statement, order or other
document believed by it to be genuine and correct and to have been signed, sent
or made by the proper Person or Persons, and upon advice and statements of legal
counsel, independent accountants and other experts selected by the Agent or the
Issuing Bank. The Agent and the Issuing Bank shall in all cases be fully
protected by the Lenders in acting, or in refraining from acting, in accordance
with a request of the Required Lenders, and such request and any action taken or
failure to act pursuant thereto shall be binding upon the Lenders and all future
holders of the Notes.

         3.6 Participation.

                  (a) Immediately upon issuance by the Issuing Bank of any
Facility Letter of Credit in accordance with the procedures set forth in Section
3.4, each Lender shall be deemed to have irrevocably and unconditionally
purchased and received from the Issuing Bank, without recourse, representation
or warranty, an undivided interest and participation equal to such Lender's
Percentage in such Facility Letter of Credit (including, without limitation, all
obligations of the Borrower with respect thereto) and all related rights
hereunder and under the

                                       37
<PAGE>

Guaranty and other Loan Documents; provided that a Letter of Credit issued by
the Issuing Bank shall not be deemed to be a Facility Letter of Credit for
purposes of this Section 3.6 if the Issuing Bank shall have received written
notice from any Lender on or before the Business Day prior to the date of its
issuance of such Letter of Credit that one or more of the conditions contained
in Section 5.2 is not then satisfied, and in the event the Issuing Bank receives
such a notice it shall have no further obligation to issue any Facility Letter
of Credit until such notice is withdrawn by that Lender or the Issuing Bank
receives a notice from the Agent that such condition has been effectively
fulfilled or waived in accordance with the provisions of this Agreement. Each
Lender's obligation to make further Loans to Borrower (other than any payments
such Lender is required to make under subparagraph (b) below) or to purchase an
interest from the Issuing Bank in any subsequent Facility Letters of Credit
issued by the Issuing Bank on behalf of Borrower shall be reduced by such
Lender's Percentage of the Facility Letter of Credit Obligations.

                  (b) In the event that the Issuing Bank makes any payment under
any Facility Letter of Credit and the Borrower shall not have repaid such amount
to the Issuing Bank pursuant to Section 3.7 hereof, the Issuing Bank shall
promptly notify the Agent, which shall promptly notify each Lender of such
failure, and each Lender shall promptly and unconditionally pay to the Agent for
the account of the Issuing Bank the amount of such Lender's Percentage of the
unreimbursed amount of such payment, and the Agent shall promptly pay such
amount to the Issuing Bank. A Lender's payments of its Percentage of such
Reimbursement Obligation as aforesaid shall be deemed to be a Loan by such
Lender and shall constitute outstanding principal under such Lender's Note. The
failure of any Lender to make available to the Agent for the account of the
Issuing Bank its Percentage of the unreimbursed amount of any such payment shall
not relieve any other Lender of its obligation hereunder to make available to
the Agent for the account of such Issuing Bank its Percentage of the
unreimbursed amount of any payment on the date such payment is to be made, but
no Lender shall be responsible for the failure of any other Lender to make
available to the Agent its Percentage of the unreimbursed amount of any payment
on the date such payment is to be made. Any Lender which fails to make any
payment required pursuant to this Section 3.6(b) shall be deemed to be a
Defaulting Lender hereunder.

                  (c) Whenever the Issuing Bank receives a payment on account of
a Reimbursement Obligation, including any interest thereon, the Issuing Bank
shall promptly pay to the Agent and the Agent shall promptly pay to each Lender
which has funded its participating interest therein, in immediately available
funds, an amount equal to such Lender's Percentage thereof.

                  (d) Upon the request of the Agent or any Lender, the Issuing
Bank shall furnish to such Agent or Lender copies of any Facility Letter of
Credit to which the Issuing Bank is party and such other readily available
documentation relating thereto as may reasonably be requested by the Agent or
Lender.

                    (e) The obligations of each Lender to make payments to the
Agent for the account of the Issuing Bank with respect to a Facility Letter of
Credit shall be absolute, unconditional and irrevocable, not subject to any
counterclaim, set-off, qualification or exception whatsoever other than a
failure of any such Issuing Bank to comply with the terms of this

                                       38
<PAGE>

Agreement relating to the issuance of such Facility Letter of Credit, and such
payments shall be made in accordance with the terms and conditions of this
Agreement under all circumstances.

         3.7 Payment of Reimbursement Obligations.

                  (a) The Borrower agrees to pay to the Agent for the account of
the Issuing Bank the amount of all Reimbursement Obligations, interest and other
amounts payable to the Issuing Bank under or in connection with any Facility
Letter of Credit when due, irrespective of any claim, set-off, defense or other
right which the Borrower may have at any time against any Issuing Bank or any
other Person, under all circumstances, including without limitation any of the
following circumstances:

                           (i) any lack of validity or enforceability of this
                  Agreement or any of the other Loan Documents;

                           (ii) the existence of any claim, setoff, defense or
                  other right which the Borrower may have at any time against a
                  beneficiary named in a Facility Letter of Credit or any
                  transferee of any Facility Letter of Credit (or any Person for
                  whom any such transferee may be acting), the Agent, the
                  Issuing Bank, any Lender, or any other Person, whether in
                  connection with this Agreement, any Facility Letter of Credit,
                  the transactions contemplated herein or any unrelated
                  transactions (including any underlying transactions between
                  the Borrower and the beneficiary named in any Facility Letter
                  of Credit);

                           (iii) any draft, certificate or any other document
                  presented under the Facility Letter of Credit proving to be
                  forged, fraudulent, invalid or insufficient in any respect of
                  any statement therein being untrue or inaccurate in any
                  respect;

                           (iv) the surrender or impairment of any security for
                  the performance or observance of any of the terms of any of
                  the Loan Documents; or

                           (v) the occurrence of any Default or Event of
                  Default.

                   (b) In order to induce the Issuing Bank to issue, extend and
renew each Facility Letter of Credit and the Lenders to participate therein, the
Borrower agrees, except as contemplated in Section 3.7(c) below, to reimburse or
pay to the Agent, for the account of the Issuing Bank or (as the case may be)
the Lenders, with respect to each Letter of Credit issued, extended or renewed
by the Issuing Bank hereunder:

                           (i) except as otherwise expressly provided in Section
                  3.7(b)(ii) below or Section 3.7(c) below, on each date that
                  any draft presented under such Facility Letter of Credit is
                  honored in accordance with its terms by the Issuing Bank, or
                  the Issuing Bank otherwise makes a payment with respect
                  thereto, (A) the amount paid by the Issuing Bank under or with
                  respect to such Facility Letter of Credit,

                                       39
<PAGE>

                  and (B) any amounts payable pursuant to this Agreement under,
                  or with respect to, such Facility Letter of Credit, and

                           (ii) upon the Maturity Date, any termination of the
                  Aggregate Commitment or any acceleration of the Reimbursement
                  Obligations with respect to all Facility Letters of Credit, an
                  amount equal to the then maximum aggregate amount that the
                  beneficiaries may at any time draw under all outstanding
                  Facility Letters of Credit, which amount shall be held by the
                  Agent as cash collateral in the Letter of Credit Collateral
                  Account for the benefit of the Issuing Bank, the Lenders and
                  the Agent for all Reimbursement Obligations.

         Each such payment shall be made to the Agent in immediately available
funds. Interest on any and all amounts not converted to an Advance pursuant to
Section 3.7(c) and remaining unpaid by the Borrower under this Section 3.7(b) at
any time from the date such amounts become due and payable (whether as stated in
this Section 3.7, by acceleration or otherwise) until payment in full (whether
before or after judgment) shall be payable to the Agent for the benefit of the
Issuing Bank and Lenders on demand at the Default Rate.

                  (c) Notwithstanding anything contained in Section 3.7(b) to
the contrary, unless the Borrower shall have notified the Agent and the Issuing
Bank prior to 11:00 a.m. (Chicago time) on the Business Day immediately prior to
the date of a drawing on a Facility Letter of Credit that the Borrower shall
reimburse the Issuing Bank for the amount of such drawing with funds other than
the proceeds of an Advance, the Borrower shall be deemed to have timely given to
the Agent a Borrowing Notice requesting a Base Rate Advance on the date on which
such drawing is honored and in an amount equal to the amount of such drawing.
The Borrowers may thereafter convert any such Base Rate Advance to a LIBOR Rate
Advance in accordance with Section 2.10 hereof. Each Lender shall, in accordance
with Article II hereof, make available such Lender's Percentage of such Advance
to the Agent, the proceeds of which shall be applied directly by the Agent to
reimburse the Issuing Bank for the amount of such draw. In the event that any
Lender fails to make available to the Agent the amount of such Lender's
Percentage of such Advance on the date of the drawing, the Agent shall be
entitled to recover such amount on demand from such Lender plus any additional
amounts payable hereunder in the event of a late funding by a Lender.

                  (d) In the event any payment by the Borrower received by the
Issuing Bank or the Agent with respect to a Facility Letter of Credit and
distributed by the Agent to the Lenders on account of their participations is
thereafter set aside, avoided or recovered from the Agent or Issuing Bank in
connection with any receivership, liquidation, reorganization or bankruptcy
proceeding, each Lender which received such distribution shall, upon demand by
the Agent, contribute such Lender's Percentage of the amount set aside, avoided
or recovered together with interest at the rate required to be paid by the
Issuing Bank or the Agent upon the amount required to be repaid by the Issuing
Bank or the Agent.

                                       40
<PAGE>

         3.8 Compensation for Facility Letters of Credit.

                  (a) The Borrower shall pay to the Agent, for the ratable
account of the Lenders, based upon the Lenders' respective Percentages, a per
annum fee (the "Facility Letter of Credit Fee") with respect to each Facility
Letter of Credit in an amount equal to the Applicable Margin in effect from time
to time for LIBOR Advances. The Facility Letter of Credit Fee relating to any
Facility Letter of Credit shall be due and payable quarterly with respect to the
period during which the Facility Letter of Credit is outstanding in arrears, on
the first Business Day of each calendar quarter following the issuance of any
Facility Letter of Credit and, to the extent any such fees are then due and
unpaid, on the Maturity Date. The Agent shall promptly remit any such Facility
Letter of Credit Fees received by it, when received, to the other Lenders in
accordance with their Percentages thereof.

                  (b) The Issuing Bank also shall have the right to receive
solely for its own account an issuance fee in the amount of the greater of $500
and 0.125 percent of the face amount of each Facility Letter of Credit, payable
by the Borrower on the Issuance Date for each such Facility Letter of Credit.
The Issuing Bank shall also be entitled to receive from Borrower upon demand its
reasonable out-of-pocket costs and the Issuing Bank's standard charges for
amending, modifying and servicing Facility Letters of Credit and processing
draws thereunder. The Borrower shall pay such issuance fee and other amounts
when due to the Agent for the account of the Issuing Bank.

         3.9 Letter of Credit Collateral Account. The Borrower hereby agrees
that it will, until and, if required hereunder, after the Maturity Date,
maintain a special collateral account (the "Letter of Credit Collateral
Account") with the Agent in the name of the Borrower but under the sole dominion
and control of the Agent, for the benefit of the Lenders, and in which the
Borrower shall have no interest other than as set forth in Section 11.1. In
addition to the foregoing, the Borrower hereby grants to the Agent, for the
benefit of the Lenders, a security interest in and to the Letter of Credit
Collateral Account and any funds that may hereafter be on deposit in such
account, including income earned thereon. The Lenders acknowledge and agree that
the Borrower has no obligation to fund the Letter of Credit Collateral Account
unless and until so required under Section 3.7(b)(ii) and/or Section 11.1
hereof.

                                       41
<PAGE>

                                   ARTICLE IV

                             CHANGE IN CIRCUMSTANCES

         4.1 Yield Protection. If the adoption of or change in any law or any
governmental or quasi-governmental rule, regulation, policy, guideline or
directive (whether or not having the force of law), or any interpretation
thereof, or the compliance of any Lender therewith,

                           (i) subjects any Lender or any applicable Lending
                  Installation to any tax, duty, charge or withholding on or
                  from payments due from Borrower (excluding federal and state
                  taxation of the overall net income of any Lender or applicable
                  Lending Installation), or changes the basis of such taxation
                  of payments to any Lender in respect of its Loans, its
                  interest in the Facility Letters of Credit or other amounts
                  due it hereunder, or

                           (ii) imposes or increases or deems applicable any
                  reserve, assessment, insurance charge, special deposit or
                  similar requirement against assets of, deposits with or for
                  the account of, or credit extended by, any Lender or any
                  applicable Lending Installation (including reserves and
                  assessments relating to LIBOR Advances), or

                           (iii) imposes any other condition, and the result is
                  to increase the cost to any Lender or any applicable Lending
                  Installation of making, funding or maintaining Loans or
                  reduces any amount receivable by any Lender or any applicable
                  Lending Installation in connection with Loans, or requires any
                  Lender or any applicable Lending Installation to make any
                  payment calculated by reference to the amount of Loans held,
                  Facility Letters of Credit issued or participated in or
                  interest received by it, by an amount deemed material by such
                  Lender,

then, within five (5) days after demand by such Lender, Borrower shall pay such
Lender that portion of such increased expense incurred or reduction in an amount
received which such Lender determines is attributable to making, funding and
maintaining its Loans and its Commitment.

         4.2 Changes in Capital Adequacy Regulations. If a Lender determines the
amount of capital required or expected to be maintained by such Lender, any
Lending Installation of such Lender or any corporate entity controlling such
Lender is increased as a result of a Change (as defined below), then, within
five (5) days after demand by such Lender, Borrower shall pay such Lender the
amount necessary to compensate for any shortfall in the rate of return on the
portion of such increased capital which such Lender determines is attributable
to this Agreement, its Loans, its interest in the Facility Letters of Credit, or
its obligation to make Loans hereunder or participate in or issue Facility
Letters of Credit hereunder (after taking into account such Lender's policies as
to capital adequacy). "Change" means (i) any change after the date of this
Agreement in the Risk-Based Capital Guidelines (as defined below) or (ii) any
adoption of or

                                       42
<PAGE>

change in any other law, governmental or quasi-governmental rule, regulation,
policy, guideline, interpretation, or directive (whether or not having the force
of law) after the date of this Agreement which affects the amount of capital
required or expected to be maintained by any Lender or any Lending Installation
or any corporation controlling any Lender. "Risk-Based Capital Guidelines" means
(i) the risk-based capital guidelines in effect in the United States on the date
of this Agreement, including transition rules, and (ii) the corresponding
capital regulations promulgated by regulatory authorities outside the United
States implementing the July 1988 report of the Basle Committee on Banking
Regulation and Supervisory Practices Entitled "International Convergence of
Capital Measurements and Capital Standards", including transition rules, and any
amendments to such regulations adopted prior to the date of this Agreement.
Without in any way affecting the Borrower's obligation to pay compensation
actually claimed by a Lender under this Section 4.2, the Borrower shall have the
right to replace any Lender which has demanded such compensation with a
replacement Lender acceptable to the Agent; provided, however, that no Monetary
Default, other material Default or any Event of Default shall then exist, and
that Borrower notifies such Lender that it has elected to replace such Lender
and notifies such Lender and the Agent of the identity of the proposed
replacement Lender not more than sixty (60) days after the date of such Lender's
most recent demand for compensation under this Section 4.2. The Lender being
replaced shall assign its Percentage of the Aggregate Commitment and its rights
and obligations under this Facility to the replacement Lender in accordance with
the requirements of Section 13.3 hereof and the replacement Lender shall assume
such Percentage of the Aggregate Commitment and the related obligations under
this Facility, all pursuant to an assignment agreement substantially in the form
of Exhibit J hereto. The purchase by the replacement Lender shall be at par
(plus all accrued and unpaid interest and any other sums owed to such Lender
being replaced hereunder) which shall be paid to the Lender being replaced upon
the execution and delivery of the assignment.

         4.3 Availability of LIBOR Advances. If any Lender determines that
maintenance of any of Loans bearing interest at the Adjusted LIBOR Rate at a
suitable Lending Installation would violate any applicable law, rule, regulation
or directive of any Governmental Authority having jurisdiction, the Agent shall
suspend by written notice to Borrower the availability of outstanding LIBOR
Advances and require any outstanding LIBOR Advances to be repaid. If the
Required Lenders determine that deposits of a type or maturity appropriate to
match fund LIBOR Advances are not available, the Agent shall suspend by written
notice to Borrower the availability of LIBOR Advances from and after the date of
any such determination. If the Required Lenders determine that an interest rate
applicable to a LIBOR Advance does not accurately reflect the cost of making a
LIBOR Advance, and, if for any reason whatsoever the provisions of Section 4.1
are inapplicable, the Agent shall suspend by written notice to Borrower the
availability of LIBOR Advances from and after the date of any such
determination.

         4.4 Funding Indemnification. If any payment of a LIBOR Advance occurs
on a date which is not the last day of the applicable Interest Period, whether
because of acceleration, prepayment or otherwise, or a LIBOR Advance is not made
on the date specified by Borrower for any reason other than default by one or
more of the Lenders, Borrower shall indemnify and hold harmless each Lender from
and against any loss, damage, expense or cost incurred by such

                                       43
<PAGE>

Lender resulting therefrom, including, without limitation, any loss, damage,
expense or cost in liquidating or employing deposits acquired to fund or
maintain the LIBOR Advance.

         4.5 Lender Statements; Survival of Indemnity. To the extent reasonably
possible, each Lender shall designate an alternate Lending Installation with
respect to its LIBOR Advances to reduce any liability of Borrower to such Lender
under Sections 4.1 and 4.2 or to avoid the unavailability of a LIBOR Advance, so
long as such designation is not disadvantageous to such Lender. Each Lender
shall deliver a written statement of such Lender as to the amount due, if any,
under Sections 4.1, 4.2 or 4.4 hereof. Such written statement shall set forth in
reasonable detail the calculations upon which such Lender determined such amount
and shall be final, conclusive and binding on Borrower in the absence of
manifest error. Determination of amounts payable under such Sections in
connection with a LIBOR Advance shall be calculated as though each Lender funded
its LIBOR Advance through the purchase of a deposit of the type and maturity
corresponding to the deposit used as a reference in determining the Adjusted
LIBOR Rate applicable to such Advance, whether in fact that is the case or not.
Unless otherwise provided herein, the amount specified in the written statement
shall be payable on demand after receipt by Borrower of the written statement.
The obligations of Borrower under Sections 4.1, 4.2 and 4.4 hereof shall survive
payment of the Obligations and termination of this Agreement.

         4.6 Taxes.

                    (a) Any and all payments by Borrower to or for the account
of any Lender or the Agent under this Agreement or under any other Loan Document
shall be made free and clear of and without deduction for any and all present or
future taxes, duties, levies, imposts, deductions, charges or withholdings, and
all liabilities with respect thereto, excluding, in the case of each Lender and
the Agent, taxes imposed on its net income, and franchise taxes imposed on it by
any jurisdiction (other than such excluded income and franchise taxes,
collectively, "Taxes"). If Borrower shall be required by law to deduct any Taxes
from or in respect of any sum payable under this Agreement or any other Loan
Document to any Lender or the Agent, (i) the sum payable shall be increased as
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 4.6) such Lender or the
Agent receives an amount equal to the sum it would have received had no such
deductions been made, (ii) Borrower shall make such deductions, (iii) Borrower
shall pay the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable law, and (iv) Borrower shall furnish to
the Agent the original or a certified copy of a receipt evidencing payment
thereof.

                  (b) In addition, Borrower agrees to pay any and all present or
future stamp or documentary taxes and any other excise or property taxes or
charges or similar levies which arise from any payment made under this Agreement
or any other Loan Document by Borrower or from the execution or delivery of, or
otherwise with respect to, this Agreement or any other Loan Document
(hereinafter referred to as "Other Taxes").

                  (c) The Borrower agrees to indemnify each Lender and the Agent
for the full amount of Taxes and Other Taxes (including, without limitation, any
Taxes or Other Taxes

                                       44
<PAGE>

imposed or asserted by any jurisdiction on amounts payable under this Section
4.6) properly paid by such Lender or the Agent (as the case may be) and any
liability (including penalties, interest, and expenses) arising therefrom or
with respect thereto. In the event that any Lender or the Agent actually
receives a refund of, or a credit in the amount of, any Taxes or Other Taxes
paid or reimbursed by Borrower pursuant to this Section 4.6, such Lender or the
Agent, as the case may be, shall pay the amount of any such refund to Borrower
promptly following actual receipt thereof, and pay the amount of any such credit
to Borrower promptly following the actual full application of such credit
against other obligations of such Lender or the Agent, as the case may be.

                  (d) Each Lender organized under the laws of a jurisdiction
outside the United States, on or prior to the date of its execution and delivery
of this Agreement in the case of each Lender listed on the signature pages of
this Agreement and on or prior to the date on which it becomes a Lender in the
case of each other Lender, and from time to time thereafter if requested in
writing by the Borrower or the Agent (but only so long as such Lender remains
lawfully able to do so), shall provide the Borrower and the Agent with (i)
Internal Revenue Service Form 1001 or 4224, as appropriate, or any successor
form prescribed by the Internal Revenue Service, certifying that such Lender is
entitled to benefits under an income tax treaty to which the United States is a
party which reduces the rate of withholding tax on payments of interest or
certifying that the income receivable pursuant to this Agreement is effectively
connected with the conduct of a trade or business in the United States, (ii)
Internal Revenue Service Form W-8 or W-9, as appropriate, or any successor form
prescribed by the Internal Revenue Service, and (iii) any other form or
certificate required by any taxing authority (including any certificate required
by Sections 871(h) and 881(c) of the Internal Revenue Code), certifying to the
Agent and Borrower that such Lender is entitled to an exemption from or a
reduced rate of tax on payments pursuant to this Agreement or any of the other
Loan Documents.

                   (e) For any period with respect to which a Lender has failed
to provide Borrower and the Agent with the appropriate form pursuant to Section
4.6(d) (unless such failure is due to a change in treaty, law, or regulation
occurring subsequent to the date on which a form originally was required to be
provided), such Lender shall not be entitled to indemnification under Section
4.6(a) or 4.6(b) with respect to Taxes imposed by the United States; provided,
however, that should a Lender, which is otherwise exempt from or subject to a
reduced rate of withholding tax, become subject to Taxes because of its failure
to deliver a form required under this Agreement, the Borrower shall take such
reasonable steps as such Lender shall reasonably request to assist such Lender
to recover such Taxes.

                   (f) If the Borrower is required to pay additional amounts to
or for the account of any Lender pursuant to this Section 4.6, then such Lender
will agree to use reasonable efforts to change the jurisdiction of its Lending
Installation so as to eliminate or reduce any such additional payment which may
thereafter accrue if such change, in the judgment of such Lender, is not
otherwise disadvantageous to such Lender.

                   (g) Within thirty (30) days after the date of any payment of
Taxes, Borrower shall furnish to the Agent the original or a certified copy of a
receipt evidencing such payment.

                                       45
<PAGE>

                   (h) Without prejudice to the survival of any other agreement
of Borrower arising in connection with this Agreement, the agreements and
obligations of the Borrower contained in this Section 4.6 shall survive the
termination of the Commitments and the payment in full of the Notes.

                                    ARTICLE V

                              CONDITIONS PRECEDENT

         5.1 Conditions Precedent to Closing. The Lenders shall not be required
to make the initial Advance hereunder, nor shall the Issuing Bank be required to
issue the initial Facility Letter of Credit hereunder, unless (i) the Borrower
shall have paid all fees then due and payable to the Lenders and the Agent
hereunder, (ii) all of the conditions set forth in Section 5.2 are satisfied,
and (iii) the Borrower shall have furnished to the Agent, in form and substance
satisfactory to the Lenders and their counsel and in a number of counterparts
sufficient for all of the Lenders, the following:

                  (a) Certificates of Incorporation. A copy of the articles of
incorporation of LNR, and a copy of the articles of incorporation or other
applicable organizational documents of each other Borrower and each Guarantor,
each certified by the appropriate Secretary of State or equivalent state
official and dated as of the most reasonable practicable date.

                  (b) Agreements of Limited Partnership/Bylaws. A copy of the
bylaws of LNR, including all amendments thereto, and a copy of the by-laws,
partnership agreement, operating agreement or other applicable governing
instrument of each other Borrower and each Guarantor, each certified by the
Secretary or other appropriate officer of the Person in question as being in
full force and effect on the date hereof.

                  (c) Good Standing Certificates. A certified copy of a
certificate from the Secretary of State or equivalent state official of the
states where each Borrower and each Guarantor are organized, dated as of the
most recent practicable date, showing the good standing of each Borrower and
each Guarantor.

                  (d) Foreign Qualification Certificates. A certified copy of a
certificate from the Secretary of State or equivalent state official of the
states where each Borrower and each Guarantor maintain their principal place of
business, dated as of the most recent practicable date, showing the
qualification to transact business in such state as a foreign entity for each
Borrower and each Guarantor.

                  (e) Resolutions. A copy of a resolution or resolutions adopted
by the Board of Directors or other applicable governing body of each Borrower
and each Guarantor, certified by the Secretary or other appropriate officer of
the Person in question as being in full force and effect on the date hereof,
authorizing the execution, delivery and performance of the Loan Documents to
which such Person is a party, and the transactions provided for therein.

                                       46
<PAGE>

                  (f) Incumbency Certificate. A certificate for each Borrower
and each Guarantor, signed by the Secretary or other appropriate officer of the
Person in question and dated the date hereof, as to the incumbency, and
containing the specimen signature or signatures, of the Persons authorized to
execute and deliver the Loan Documents to be executed and delivered by such
Borrower or Guarantor, as the case may be.

                  (g) Loan Documents. Originals of the Loan Documents (in such
quantities as the Lenders may reasonably request), duly executed by authorized
officers of the appropriate entity.

                  (h) Opinion of Florida Counsel. A written opinion, dated the
date hereof, from outside Florida counsel for the Borrower and each Guarantor,
which counsel is reasonably satisfactory to Agent, substantially in the form
attached hereto as Exhibit E, but relating to this Agreement, rather than the
Original Agreement.

                  (i) Opinion of Illinois Counsel. A written opinion, dated the
date hereof, from outside Illinois counsel for the Borrower and each Guarantor,
which counsel is reasonably satisfactory to Agent, substantially in the form
attached hereto as Exhibit F, but relating to this Agreement, rather than the
Original Agreement.

                  (j) Insurance. Original or certified copies of insurance
policies or binders therefor, with accompanying receipts showing current payment
of all premiums, evidencing that Borrower carries insurance on all Properties,
which satisfies the Agent's insurance requirements, including, without
limitation:

                           (i) Property and casualty insurance (including
                  coverage for flood and other water damage for any Properties
                  located within a 100-year flood plain) in the amount of the
                  replacement cost of the improvements at the Properties with
                  limits (if any) of not less than $40,000,000 per occurrence;

                           (ii) Loss of rental income insurance in the amount
                  not less than one year's net revenues from the Properties; and

                           (iii) Comprehensive general liability insurance in
                  the amount of at least $5,000,000 per occurrence.

                           All insurance must be carried by companies with a
Best Insurance Reports (1996) Policyholder's and Financial Size Rating of "A-IX"
or better; provided, however, that if Borrower uses multiple insurers to insure
distinct tiers of risk, only the insurers of the first two tiers of risk (i.e.,
the first dollars of loss with respect to any insured risk) must be rated as
aforesaid, but other insurers shall in any event be rated "A-VII" or better.

                  (k) Borrowing Base Calculation. A calculation of the Borrowing
Base and an initial Borrowing Base report, each conforming to the requirements
of Section 8.2(ii) hereof (a copy of which is attached to Exhibit H to this
Agreement).

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<PAGE>

                  (l) Financial and Related Information. The following
information:

                           (i) A certificate, signed by an executive officer of
                  the Borrower, stating that on the date hereof no Default or
                  Event of Default has occurred and is continuing and that all
                  representations and warranties of the Borrower contained
                  herein are true and correct as of the Agreement Execution Date
                  as and to the extent set forth herein;

                           (ii) The most recent consolidated annual and
                  quarterly financial statements of the Borrower and a
                  certificate from a Qualified Officer of LNR that no change in
                  the Borrower's financial condition that could have a Material
                  Adverse Effect has occurred since February 28, 2000;

                           (iii) Written money transfer instructions, in
                  substantially the form of Exhibit G hereto, addressed to the
                  Agent and signed by a Qualified Officer of LNR, together with
                  such other related money transfer authorizations as the Agent
                  may have reasonably requested; and

                           (iv) Operating statements (certified as accurate by a
                  Qualified Officer of LNR) and other evidence satisfactory to
                  the Agent to establish Borrower's compliance with the
                  covenants set forth in Articles VII, VIII and IX hereof.

                  (m) Other Evidence as any Lender May Require. Such other
documents and evidence as the Agent or any Lender may reasonably request to
fully effectuate and establish the consummation of the transactions contemplated
hereby, the taking of all necessary actions in any proceedings in connection
herewith and compliance with the conditions set forth in this Agreement.

         5.2 Conditions Precedent to Subsequent Advances. Advances after the
initial Advance shall be made from time to time as requested by Borrower, and
the obligation of each Lender to make any Loan for any such Advance (including
Swingline Loans), and the obligation of the Issuing Bank to issue Facility
Letters of Credit, are subject to the following terms and conditions:

                  (a) Prior to and at the time of each such Advance or issuance
no Default or Event of Default shall have occurred and be continuing under this
Agreement or any of the Loan Documents and, if required by Agent, Borrower shall
deliver a certificate of Borrower to such effect; and

                  (b) The representations and warranties contained in Article VI
are true and correct as of such Borrowing Date, Issuance Date, or date of
conversion and/or continuation as and to the extent set forth therein, except to
the extent any such representation or warranty is stated to relate solely to an
earlier date, in which case such representation or warranty shall be true and
correct on and as of such earlier date.

                                       48
<PAGE>

                  (c) As to each Subsidiary that executes and delivers a
Subsidiary Joinder or a Guaranty after the Agreement Execution Date (or that is
required to do so), the Borrower has delivered to the Agent the items described
in subsections (a) through (i) of Section 5.1 hereof.

         Each Borrowing Notice, Letter of Credit Request, and
Conversion/Continuation Notice shall constitute a representation and warranty by
the Borrower that the conditions contained in Sections 5.2(a) through (c) have
been satisfied.

                                   ARTICLE VI

                         REPRESENTATIONS AND WARRANTIES

         Borrower hereby represents and warrants that:

         6.1 Existence. Attached hereto as Schedule 6.1 (as updated from time to
time in accordance with this Agreement) is a table showing, for each Credit
Party, its organizational form (e.g., corporation, partnership, limited
liability company, etc.), state of organization, state in which its principal
place of business is located, owner(s) of its Capital Stock and percentage
ownership interest, and certain other information. Each Credit Party is an
entity of the type indicated for such Credit Party on Schedule 6.1 (as updated
from time to time) duly organized and validly existing under the laws of the
state of its organization as indicated on Schedule 6.1 (as updated from time to
time), with its principal place of business in the state indicated for such
Credit Party on Schedule 6.1 (as updated from time to time), and is duly
qualified as a foreign entity, properly licensed (if required), in good standing
and has all requisite authority to conduct its business in each jurisdiction in
which it owns any Real Estate and, except where the failure to be so qualified
or to obtain such authority would not have a Material Adverse Effect, in each
other jurisdiction in which the nature of its business or activities requires
such qualification or authority. Each Subsidiary of each Credit Party is duly
organized, validly existing and in good standing under the laws of its
jurisdiction of organization and has all requisite authority to conduct its
business in each jurisdiction in which it owns any Real Estate, and except where
the failure to be so qualified or to obtain such authority would not have a
Material Adverse Effect, in each other jurisdiction in which the nature of its
business or activities requires such qualification.

         6.2 Corporate/Partnership Powers. The execution, delivery and
performance of the Loan Documents required to be delivered by each Credit Party
hereunder are within the authority of such entity and the powers of the general
partners of each such entity which is a partnership, have been duly authorized
by all requisite action, and are not in conflict with the terms of any
organizational instruments of such entity, or any instrument or agreement to
which such Credit Party is a party or by which such Credit Party or any of its
respective assets may be bound or affected.

         6.3 Power of Officers. The officer of each corporate Credit Party
executing the Loan Documents on its own behalf or on behalf of another Credit
Party, either in its capacity as the corporate partner, manager or member of
another Credit Party, or in its capacity as the corporate

                                       49
<PAGE>

partner, manager or member of a third Credit Party which is the non-corporate
partner or member of such other Credit Party, has been duly elected or appointed
and was fully authorized to execute the same at the time such Loan Document was
executed. Each of the Loan Documents has been duly and validly executed and
delivered by or on behalf of each and all of the Credit Parties pursuant to
authority duly conferred on each individual signatory and/or entity which has
executed such Loan Document on its behalf.

         6.4 Government and Other Approvals. No approval, consent, exemption or
other action by, or notice to or filing with, any governmental authority is
necessary in connection with the execution, delivery or performance of any of
the Loan Documents by any of the Credit Parties. No other consent to or approval
of the transactions contemplated hereunder is required from any ground lessor,
mortgagee, beneficiary under a deed of trust or any other Person, except as has
been delivered to the Lenders on or before the Agreement Execution Date.

         6.5 Solvency. Immediately after the Agreement Execution Date and the
date hereof, and immediately following the making of each Advance and after
giving effect to the application of the proceeds of such Advance, each of the
Borrower and its Subsidiaries will be Solvent.

         6.6 Compliance With Laws and Agreements. There is no judgment, decree
or order or any law, rule or regulation of any court or governmental authority
binding on any of the Credit Parties or any of their respective assets which
would be violated or contravened by the execution, delivery or performance of
the Loan Documents. The Credit Parties and their respective Real Estate and
other assets are in substantial compliance with applicable laws, and with all
material leases, licenses and other agreements to which any Credit Party is a
party or by which such Credit Party or any of its assets is bound. There exist
no defaults on the part of any other party to any such lease, license or other
agreement which, individually or in the aggregate, could have a Material Adverse
Effect.

         6.7 Enforceability of Agreement. This Agreement and each of the other
Loan Documents is (or, when fully executed and delivered, will be) the legal,
valid and binding agreement of each of the Credit Parties thereto, enforceable
against each such Credit Party in accordance with its respective terms, except
to the extent that such enforcement may be limited by applicable bankruptcy,
insolvency, reorganization or other similar laws affecting the rights of
creditors generally.

         6.8 Title to Property. Borrower or its Subsidiaries (or, in the case of
the Parcels, an Investment Affiliate) has good and marketable title to the Real
Estate and assets reflected in the financial statements most recently delivered
to the Agent as owned by it or any such Subsidiary (or, in the case of the
Parcels, an Investment Affiliate) free and clear of Liens except for the
Permitted Liens, and except for mechanics liens with respect to amounts claimed
to be past due (i) which are being contested in good faith and by appropriate
proceedings, (ii) for which adequate reserves have been established on the books
of Borrower in accordance with GAAP, and (iii) which, individually and in the
aggregate, could not have a Material Adverse Effect. Neither the execution,
delivery nor performance of the Loan Documents required by the Credit Parties
will result in the creation of any Lien on the Real Estate or such assets.
Borrower and its

                                       50
<PAGE>

Subsidiaries either own, or have entered into valid leases, licenses and other
agreements for, all assets, services and facilities necessary for the conduct of
their respective businesses and the operation of their respective assets.

         6.9 Litigation. There are no suits, arbitrations, claims, disputes or
other proceedings (including, without limitation, any civil, criminal,
administrative or environmental proceedings), pending or, to the best of
Borrower's knowledge after due inquiry, threatened against or affecting any of
the Borrower or its Subsidiaries or any of the Real Estate, the adverse
determination of which individually or in the aggregate could have a Material
Adverse Effect, except as disclosed on Schedule 6.9 hereto.

         6.10 Events of Default. No Default or Event of Default has occurred and
is continuing or would result from the incurring of obligations by any of the
Credit Parties under any of the Loan Documents or any other document to which
any of the Credit Parties is a party.

         6.11 Investment Company Act of 1940. None of the Borrower or its
Subsidiaries is an investment company within the meaning of the Investment
Company Act of 1940 and none of the Credit Parties will become such an
investment company.

         6.12 Public Utility Holding Company Act. None of the Borrower or its
Subsidiaries is a "holding company" or a "subsidiary company" of a "holding
company," or an "affiliate" of a "holding company," or of a "subsidiary company"
of a "holding company," within the definitions of the Public Utility Holding
Company Act of 1935, as amended.

         6.13 Regulation U. The proceeds of the Advances will not be used,
directly or indirectly, to purchase or carry any Margin Stock or to extend
credit to others for the purpose of purchasing or carrying any Margin Stock.

         6.14 No Material Adverse Financial Change. There has been no Material
Adverse Financial Change since the date of the financial and/or operating
statements most recently submitted to the Lenders. As of the date hereof, there
has been no Material Adverse Financial Change relating to any of information and
documents heretofore delivered to the Agent pursuant to subsection (k) and (l)
of Section 5.1 of the Original Agreement, and no material change relating to any
of the other information and documents heretofore delivered to the Agent
pursuant to said Section 5.1.

         6.15 Financial Information. All financial statements and operating
statements furnished to the Lenders by or at the direction of any of the Credit
Parties and all other financial information and data furnished by any of the
Credit Parties to the Lenders are complete and correct in all material respects
as of the date thereof, and such statements have been prepared in accordance
with GAAP and fairly present the consolidated financial condition and results of
operations of the Credit Parties and the Real Estate as of such date. None of
the Credit Parties has any contingent obligations, liabilities for taxes or
other outstanding financial obligations which are material in the aggregate,
except as disclosed in such statements, information and data.

                                       51
<PAGE>

         6.16 Factual Information. All factual information heretofore or
contemporaneously furnished by or on behalf of any of the Credit Parties to the
Lenders for purposes of or in connection with this Agreement and the other Loan
Documents and the transactions contemplated herein and therein is, and all other
such factual information hereafter furnished by or on behalf of any of the
Credit Parties to the Lenders will be, true and accurate in all material
respects on the date as of which such information is dated or certified and not
incomplete by omitting to state any material fact necessary to make such
information not misleading at such time.

         6.17 ERISA. (i) None of the Borrower or its Subsidiaries is an entity
deemed to hold "plan assets" within the meaning of ERISA or any regulations
promulgated thereunder of an employee benefit plan (as defined in Section 3(3)
of ERISA) which is subject to Title I of ERISA or any plan within the meaning of
Section 4975 of the Code, and (ii) the execution of this Agreement and the other
Loan Documents and the transactions contemplated hereunder and thereunder do not
give rise to a prohibited transaction within the meaning of Section 406 of ERISA
or Section 4975 of the Code.

         6.18 Taxes. All required tax returns have been filed by each of the
Borrower or its Subsidiaries with the appropriate authorities except to the
extent that extensions of time to file have been requested, granted and have not
expired or except to the extent such taxes are being contested in good faith by
appropriate proceedings and for which adequate reserves, in accordance with
GAAP, are being maintained.

         6.19 Environmental Matters. Except as disclosed in Schedule 6.19 and
except for Real Estate owned by Investment Affiliates which are not Special
Investment Affiliates:

                           (i) The Real Estate does not contain any Materials of
                  Environmental Concern in amounts or concentrations which
                  constitute a violation of, or could give rise to liability
                  under, Environmental Laws.

                           (ii) None of Borrower, its Subsidiaries or Investment
                  Affiliates has received any written notice alleging that any
                  or all of the Real Estate or any or all of the operations at
                  the Real Estate are not in compliance with all applicable
                  Environmental Laws, or alleging the existence of any
                  contamination at or under such Real Estate in amounts or
                  concentrations which constitute a violation of any
                  Environmental Law.

                           (iii) To the best of Borrower's knowledge after due
                  inquiry, no notice, violation, non-compliance or liability
                  referred to in Section 6.19(ii) above is threatened, and no
                  condition, fact or circumstance exists that could result in
                  such notice, violation, non-compliance or liability.

                           (iv) During the ownership of the Real Estate by any
                  or all of Borrower, its Subsidiaries and Investment
                  Affiliates, Materials of Environmental Concern have not been
                  released, transported or disposed of, or otherwise migrated,
                  from

                                       52
<PAGE>

                  the Real Estate in violation of, or in a manner or to a
                  location which could give rise to liability under any
                  applicable Environmental Laws, nor during the ownership of the
                  Real Estate by any or all of Borrower, its Subsidiaries and
                  Investment Affiliates have any Materials of Environmental
                  Concern been generated, treated, stored, abandoned or disposed
                  of at, on or under any of such the Real Estate in violation
                  of, or in a manner that could give rise to liability under any
                  applicable Environmental Laws. To the best knowledge of
                  Borrower after due inquiry, no such release, transport,
                  disposal, migration, generation, treatment, abandonment or
                  storage from, at, on or under any of the Real Estate occurred
                  prior to ownership thereof by Borrower, its Subsidiaries and
                  Investment Affiliates.

                           (v) No judicial proceedings or governmental or
                  administrative action is pending, or, to the best knowledge of
                  Borrower after due inquiry, threatened, under any
                  Environmental Law to which Borrower, any of its Subsidiaries
                  or any Investment Affiliate is named as a party with respect
                  to any of the Real Estate, nor are there any consent or other
                  decrees, orders, or other administrative or judicial decisions
                  or requirements outstanding under any Environmental Law with
                  respect to such Real Estate.

         6.20 Insurance. Borrower has obtained the insurance which Borrower is
required to furnish to Lenders under Section 5.1(j) hereof.

         6.21 No Brokers. None of the Borrower or its Subsidiaries or Affiliates
has dealt with any brokers, finders or other intermediaries in connection with
this Facility, and no fees, commissions or other compensation are payable by or
to any such Person in connection with this Agreement or the Advances. Lenders
shall not be responsible for the payment of any fees or commissions to any
brokers, finders or other intermediaries and Borrower shall indemnify, defend
and hold Lenders harmless from and against any claims, liabilities, obligations,
damages, costs and expenses (including attorneys' fees and disbursements) made
against or incurred by Lenders as a result of claims made or actions instituted
by any brokers, finders or other intermediaries claiming by, through or under
any of the Borrower or its Subsidiaries or Affiliates in connection with the
Facility.

         6.22 No Violation of Usury Laws. No aspect of any of the transactions
contemplated herein or in any of the other Loan Documents violates or will
violate any applicable usury laws or laws regarding the validity of agreements
to pay interest.

         6.23 Not a Foreign Person. None of the Credit Parties is a "foreign
person" within the meaning of Section 1445 or Section 7701 of the Code.

         6.24 No Trade Name. Except for the name "LNR Property Corporation" and
except as otherwise set forth on Schedule 6.24 attached hereto, none of the
Borrower or its Subsidiaries uses any trade name and has not and does not do
business under any name other than their actual names set forth herein.

                                       53
<PAGE>

         6.25 Subsidiaries. Schedule 6.25 hereto (as updated from time to time
in accordance with this Agreement) contains an accurate list of all of the
Subsidiaries of each of the Credit Parties, which Subsidiaries are not
themselves Credit Parties, and of all of the Investment Affiliates of each of
the Credit Parties, setting forth their respective jurisdictions of formation,
the percentage of their respective Capital Stock owned by each Credit Party and
the Real Estate owned by them. All of the issued and outstanding shares of
Capital Stock of all of the direct and indirect Subsidiaries and Investment
Affiliates of LNR have been duly authorized and issued and are fully paid and
non-assessable. All of such Capital Stock owned directly or indirectly by
Borrower is free and clear of Liens, except as otherwise specifically noted on
Schedule 6.25 (as updated from time to time).

         6.26 Properties. Schedule 6.26 hereto (as updated from time to time in
accordance with the terms of this Agreement) contains a complete and accurate
description, as of the Agreement Execution Date and the date of each update of
Schedule 6.26 submitted by Borrower from time to time in accordance with the
terms of this Agreement, of each Project and Property, including the name of the
entity that owns each such Project or Property, and whether such Project or
Property is a Development Property, a Stabilized Project, a Completed Project
and/or an Unencumbered Asset. With respect to each Project and Property
identified from time to time by Borrower for inclusion in the Borrowing Base,
Borrower hereby represents and warrants as follows, except to the extent
otherwise disclosed in writing to the Lenders and approved in writing by the
Required Lenders:

                  (a) No portion of any improvement on any such Project or
Property is located in an area identified by the Secretary of Housing and Urban
Development or any successor thereto as an area having special flood hazards
pursuant to the National Flood Insurance Act of 1968 or the Flood Disaster
Protection Act of 1973, as amended, or any successor law, or, if located within
any such area, Borrower has obtained and will maintain the insurance prescribed
in Section 5.1(j) hereof.

                  (b) To the Borrower's knowledge, each such Project and
Property and the development, use and occupancy thereof are in material
compliance with all applicable zoning ordinances (without reliance upon
adjoining or other properties), building codes, land use and Environmental Laws,
and other laws regulating the development, use and occupancy of real property
("Applicable Laws").

                  (c) Each such Project and Property is or, in the case of raw
land, can (at reasonable cost) be served by all utilities required for the
current and contemplated uses thereof.

                  (d) All public roads and streets necessary for service of and
access to each such Property and Project for the current or contemplated use
thereof have been or, in the case of raw land, will be completed, are or, in the
case of raw land, will be serviceable and all-weather and are or, in the case of
raw land, will be physically and legally open for use by the public.

                  (e) Each such Property and Project is or, in the case of raw
land, will be served by public water and sewer systems.

                                       54
<PAGE>

                  (f) Each such Property and Project is free of any patent or,
to the best knowledge of Borrower and its Subsidiaries, latent structural or
other material defect or deficiency. Each such Property and Project is free of
damage and waste that would materially and adversely affect its value, is in
good repair and there is no deferred maintenance other than ordinary wear and
tear. Each such Property or Project is free from damage caused by fire or other
casualty. There is no pending or, to the best knowledge of Borrower after due
inquiry, threatened condemnation proceedings affecting any such Project or
Property, or any material part thereof.

                  (g) All liquid and solid waste disposal, septic and sewer
systems located on each such Property and Project are in a good and safe
condition and repair and are in compliance with all Applicable Laws with respect
to such systems.

                  (h) All improvements on each such Property and Project lie
within the boundaries and building restrictions of the legal description of
record of such Property or Project, no such improvements encroach upon any
adjoining property, and no improvements on adjoining properties encroach upon
such Property or Project or easements benefiting such Property or Project. All
amenities, access routes or other items that benefit such Property or Project
are under direct control of Borrower or one of its Subsidiaries, constitute
permanent easements that benefit all or part of such Property or Project or are
public property, and such Property or Project, by virtue of such easements or
otherwise, is contiguous to a physically open, dedicated all weather public
street, and has the necessary permits for ingress and egress.

                  (i) There are no delinquent taxes, ground rents, water
charges, sewer rents, assessments, insurance premiums, leasehold payments, or
other outstanding charges affecting any such Project or Property, except to the
extent such items are being contested in good faith by appropriate proceedings
and as to which adequate reserves have been provided.

                  (j) With respect to each Development Property, each required
performance bond, surety or other security has been issued to and in favor of
and unconditionally accepted by each relevant governmental authority, all plans,
specifications and drawings for improvements have been approved by all relevant
governmental authorities, and all necessary easements, licenses, permits and
other authorizations have been granted for the development thereof (including,
without limitation, demolition, grading and construction permits).

         6.27 Relationship of the Borrower. The Borrower and its Subsidiaries
are engaged as an integrated group in the business of owning, developing and
selling real estate, of providing the required services, credit and other
facilities for those integrated operations and of making other types of
investments permitted herein. The Credit Parties require financing on such a
basis that funds can be made available from time to time to such entities, to
the extent required for the continued successful operation of their integrated
operations. The Advances to be made to the Borrower and the Facility Letters of
Credit to be issued for the account of the Borrower under this Agreement are for
the purpose of financing the integrated operations of the Credit Parties, and
each of the Credit Parties expects to derive benefit, directly or indirectly,
from the Advances and Facility Letters of Credit, both individually and as a
member of the integrated group, since

                                       55
<PAGE>

the financial success of the operations of each Borrower and Guarantor is
dependent upon the continued successful performance of the integrated group as a
whole.

         6.28 No Side Deals. None of the Borrower or its Subsidiaries or
Affiliates have entered into any written or oral agreements, arrangements or
understandings with any Lender or any Affiliate of any Lender relating to the
Facility or the Loan Documents, except as otherwise disclosed in this Agreement.

         6.29 Stock Pledge. The Capital Stock of each wholly-owned direct or
indirect Subsidiary of Borrower that is not itself a Borrower or a Guarantor has
been pledged to the Lenders pursuant to the Pledge Agreement.

                                   ARTICLE VII

                               FINANCIAL COVENANTS

         The Borrower covenants and agrees that, so long as the Commitments
shall remain in effect and until full and final payment of all Obligations,
without the prior written consent of the Required Lenders, it shall not, and
shall cause the other Credit Parties not to:

         7.1 Borrowing Base Limit. At any time, permit the aggregate amount of
the Obligations to exceed an amount equal to the Borrowing Base, less
outstanding Consolidated Senior Unsecured Debt other than the Facility.

         7.2 Maximum Leverage Ratios.

                  (a) Total Leverage Ratio. At any time, permit the Leverage
Ratio to exceed 2.75:1.

                  (b) Senior Leverage Ratio. At any time, permit the Senior
Leverage Ratio to exceed 2.25:1.

         7.3 Minimum Consolidated Tangible Net Worth. At any time, permit
Consolidated Tangible Net Worth to be less than the sum of (i) $558,000,000,
plus (ii) an amount equal to 75 percent of the aggregate proceeds received by
Borrower in connection with any offering or issuance of Capital Stock of the
Borrower after the Agreement Execution Date, plus (iii) 80 percent of the
consolidated retained earnings of the Borrower accrued after the Agreement
Execution Date (which accrued consolidated retained earnings shall be computed
on a cumulative basis without deduction for any losses).

         7.4 Interest Coverage. Permit the ratio of Adjusted EBITDA to Interest
Expense to be less than 2.0:1 at any time prior to November 30, 2001, or,
thereafter, at any time permit the ratio of Adjusted EBITDA to Interest Expense
to be less than 1.75:1.

                                       56
<PAGE>

         7.5 Fixed Charge Coverage. Permit the ratio of Adjusted EBITDA to Fixed
Charges to be less than 1.75:1 at any time prior to November 30, 2001, or,
thereafter, at any time permit the ratio of Adjusted EBITDA to Fixed Charges to
be less than 1.60:1.

         7.6 Other Unsecured Senior Debt. At any time, permit Consolidated
Senior Unsecured Debt other than the Facility that does not satisfy each of the
following requirements: (i) the terms and condition of such other Consolidated
Senior Unsecured Debt shall, in the judgment of the Required Lenders, be no more
favorable to the lender(s) thereof than the terms and conditions of the
Facility, and (ii) such lender(s), the Borrower and the Lenders have entered
into an intercreditor agreement(s) satisfactory to the Required Lenders.

         7.7 Subordinated Debt. Incur or issue any Subordinated Debt, except on
terms and conditions with respect to subordination satisfactory to the Required
Lenders, or, without the prior written consent of the Required Lenders, prepay
or repurchase any Subordinated Debt, other than from the proceeds of any public
offering of equity interests in Borrower after the Agreement Execution Date.

Compliance with the financial covenants set forth in Sections 7.4 and 7.5 shall
be measured and certified following the end of each fiscal quarter with respect
to the one year period consisting of such fiscal quarter and the three
immediately preceding fiscal quarters, in accordance with Section 8.2 hereof.
Compliance with the other financial covenants set forth in Article VII shall be
measured and certified following the end of each fiscal quarter as of the end of
such fiscal quarter in accordance with Section 8.2 hereof. The measurement and
certification of compliance with any given financial covenant as of a particular
date or for a particular period as aforesaid shall not be deemed to permit
non-compliance with such covenant as of any other date or period on or during
which the Borrower is required to comply therewith pursuant to the terms hereof.

                                  ARTICLE VIII

                              AFFIRMATIVE COVENANTS

         The Borrower covenant and agree that so long as the Commitment of any
Lender shall remain available and until the full and final payment of all
Obligations incurred under the Loan Documents they will:

         8.1 Notices. Promptly give written notice to Agent of:

                  (a) all litigation or arbitration proceedings affecting the
Borrower or any of the other Credit Parties, where the amount claimed is
$2,500,000 or more;

                                       57
<PAGE>

                  (b) any Default or Event of Default, specifying the nature and
the period of existence thereof and what action has been taken or been proposed
to be taken with respect thereto;

                  (c) all claims filed against any of the Real Estate which, if
adversely determined, could have a Material Adverse Effect;

                  (d) the occurrence of any other event which might have a
Material Adverse Effect;

                  (e) any Reportable Event or any "prohibited transaction" (as
such term is defined in Section 4975 of the Code) in connection with any Plan or
any trust created thereunder, which may, singly or in the aggregate materially
impair the ability of any of the Credit Parties to repay any of its obligations
under the Loan Documents, describing the nature of each such event and the
action, if any, such Credit Party proposes to take with respect thereto;

                  (f) any notice from any federal, state, local or foreign
authority regarding any Hazardous Material, asbestos, or other environmental
condition, proceeding, order, claim or violation affecting any of the Real
Estate of any Borrower, Subsidiary or Special Investment Affiliate.

         8.2 Financial Statements, Reports. Etc. The Borrower shall maintain,
for itself and each Subsidiary, a system of accounting established and
administered in accordance with GAAP, and furnish to the Lenders:

                           (i) As soon as available, but in any event not later
                  than 60 days after the close of each of the first three fiscal
                  quarters, for the Borrower and its Subsidiaries, an unaudited
                  consolidated balance sheet as of the close of each such period
                  and the related unaudited consolidated statements of income
                  and stockholders equity for such period and for the year to
                  date and cash flows for the year to date of the Borrower and
                  its Subsidiaries, setting forth in each case in comparative
                  form the corresponding figures for the previous year, all
                  prepared in accordance with GAAP and all certified as being
                  complete and accurate, subject to normal year end adjustments,
                  by a Qualified Officer of the Borrower, accompanied by a
                  reasonably detailed discussion by such Qualified Officer of
                  material variances from the most recent projections delivered
                  pursuant to Section 8.2(v) hereof;

                           (ii) Not later than 120 days after the end of each
                  fiscal year and, unless otherwise indicated below, not later
                  than 60 days after the close of each of the first three fiscal
                  quarters, for the Borrower and its Subsidiaries, related
                  reports in the form attached hereto as Exhibit K, and in
                  substance and detail satisfactory to the Lenders, all
                  certified by a Qualified Officer of Borrower, including: (a)
                  an update of Schedules 6.1 to this Agreement and, on an annual
                  basis only, within 120 days after the end of each fiscal year,
                  updates to Schedules 6.25 and 6.26 to this

                                       58
<PAGE>

                  Agreement; (b) a calculation of the Borrowing Base; (c) a
                  separate report regarding each category of assets included in
                  such calculation pursuant to one of the numbered subsections
                  of the definition of "Borrowing Base" (which reports shall
                  identify the assets in each such category, identify any Liens
                  on each such asset, show the valuation of each such asset used
                  in such calculation in accordance with such definition and,
                  for any valuation based, in whole or in part, on projections,
                  show a comparison of projections to actual results for the
                  period covered by said report; and which reports relating to
                  Real Estate shall set forth summary information for all Real
                  Estate owned by any Borrower or Subsidiary, including, without
                  limitation, occupancy rates, square footage, property type,
                  date acquired or built, Gross Revenues, Net Operating Income,
                  operating expenses, capital expenditures and the status of
                  development, which information, as to Real Estate not included
                  in the Borrowing Base, need not be furnished on a quarterly
                  basis, but on an annual basis only, within 120 days after the
                  end of each fiscal year); (d) a report listing and describing
                  all newly formed or acquired Subsidiaries and all Real Estate
                  newly acquired by any Borrower or Subsidiary, including the
                  cost of such newly acquired Real Estate and secured or
                  unsecured Indebtedness assumed in connection with the
                  acquisition thereof, if any; (e) a report of all Liens on the
                  Real Estate which, due to their perceived significance, have
                  been specifically brought to the attention of any Qualified
                  Officer, other than the Permitted Liens; (f) a report
                  regarding payment arrearages and other defaults by third
                  Persons under any leases, licenses and other agreements with
                  any Credit Party, or affecting the Real Estate of any Credit
                  Party, that, due to their perceived significance, have come to
                  the attention of any Qualified Officer; and (g) such other
                  information as may be requested (including, without
                  limitation, operating statements) to evaluate the quarterly
                  compliance certificate delivered as provided below;

                           (iii) As soon as available but in no event later than
                  the third business day after the date such reports are to be
                  filed with the Securities Exchange Commission, copies of any
                  Forms 10K, 10Q, 8K, and any other annual, quarterly, monthly
                  or other reports, copies of all registration statements and
                  any other public information which the Borrower or any of its
                  Subsidiaries files with the Securities Exchange Commission or
                  any other governmental authority;

                           (iv) As soon as available, but in any event not later
                  than 120 days after the close of each fiscal year of the
                  Borrower and its Subsidiaries, (a) (i) a consolidated and, if
                  available, consolidating balance sheet of Borrower and its
                  Subsidiaries as of the end of that fiscal year and related
                  consolidated and, if available, consolidating statements of
                  income, cash flows and stockholders' equity for that fiscal
                  year, (ii) a separate balance sheet of the Mortgage Subsidiary
                  as of the end of that fiscal year and related statements of
                  income, retained earnings, cash flows and stockholders' equity
                  for that fiscal year, in each case with accompanying notes and
                  schedules, prepared in accordance with GAAP and audited by a
                  firm of independent certified public accountants of recognized

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                  standing selected by Borrower and acceptable to the Agent,
                  which accountants shall have issued an unqualified audit
                  report thereon, and (b) a letter signed by said accountants to
                  the effect that, during the course of their examination,
                  nothing came to their attention which caused them to believe
                  that any Default or Event of Default has occurred, or if they
                  believe that any Default or Event of Default occurred,
                  specifying the facts with respect thereto;

                           (v) Within 90 days after the beginning of each fiscal
                  year of Borrower, projections in reasonable detail and in form
                  and substance satisfactory to the Agent, on a quarterly basis,
                  of (a) the assets, liabilities, cash flow and earnings of the
                  Borrower and its Subsidiaries for that fiscal year and the
                  following fiscal year, and (b) compliance by Borrower with the
                  financial covenants set forth in Article VII hereof for that
                  fiscal year and the following fiscal year;

                           (vi) As soon as available, but in any event not later
                  than three business days after receipt thereof by any Borrower
                  or Subsidiary, all quarterly financial statements, operating
                  reports and other financial and operating information
                  regarding Investment Affiliates in which the Borrower or any
                  of its Subsidiaries has made a net Investment of $10,000,000
                  or more and/or Real Estate owned by any such Investment
                  Affiliate;

                           (vii) As soon as available, but in any event not
                  later than 120 days after the close of each fiscal year of
                  each Investment Affiliate a balance sheet of such Investment
                  Affiliate as of the end of that fiscal year and related
                  statements of income, cash flow and stockholders' equity for
                  that fiscal year, with accompanying notes and schedules,
                  prepared in accordance with GAAP and audited by a firm of
                  independent certified public accountants, which accountants
                  have issued an unqualified report thereon, provided, however,
                  that Borrower may furnish unaudited financial statements for
                  any Investment Affiliate if the organizational and governing
                  agreements and instruments thereof (such as, without
                  limitation, partnership, joint venture, shareholder and
                  operating agreements) do not require annual audited financial
                  statements and no audited financial statements are in fact
                  prepared for such Investment Affiliate;

                           (viii) Not later than sixty (60) days after the end
                  of each of the first three fiscal quarters, and not later than
                  one-hundred and twenty (120) days after the end of the fiscal
                  year, a compliance certificate in substantially the form of
                  Exhibit H hereto signed by a Qualified Officer of the Borrower
                  confirming that Borrower is in compliance with all of the
                  covenants of the Loan Documents, showing the calculations and
                  computations necessary to determine compliance with the
                  financial covenants contained in this Agreement (including
                  such schedules and backup information as may be necessary to
                  demonstrate such compliance) and stating that no Default or
                  Event of Default exists, or if any Default or Event of Default
                  exists, stating the nature and status thereof;

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<PAGE>

                           (ix) (a) As soon as possible and in any event within
                  10 Business Days after the Borrower knows that any Reportable
                  Event has occurred with respect to any Plan, a statement,
                  signed by a Qualified Officer of the Borrower, describing said
                  Reportable Event and within 20 days after such Reportable
                  Event, a statement signed by such officer describing the
                  action which Borrower proposes to take with respect thereto;
                  and (b) within 10 Business Days of receipt, any notice from
                  the Internal Revenue Service, PBGC or Department of Labor with
                  respect to a Plan regarding any excise tax, proposed
                  termination of a Plan, prohibited transaction or fiduciary
                  violation under ERISA or the Code which could result in any
                  liability to Borrower or any member of the Controlled Group in
                  excess of $100,000; and (c) within 10 Business Days of filing,
                  any Form 5500 filed by Borrower with respect to a Plan or any
                  member of the Controlled Group which includes a qualified
                  accountant's opinion.

                           (x) As soon as possible and in any event within 10
                  days after receipt by the Borrower, a copy of (a) any notice
                  or claim to the effect that the Borrower or any of its
                  Subsidiaries or Special Investment Affiliates is or may be
                  liable to any Person as a result of the release by such
                  entity, or any of its Subsidiaries, or any other Person of any
                  toxic or hazardous waste or substance into the environment,
                  and (b) any notice alleging any violation of any federal,
                  state or local environmental, health or safety law or
                  regulation by the Borrower or any of its Subsidiaries or
                  Special Investment Affiliates, which, in either case, could be
                  reasonably likely to have a Material Adverse Effect;

                           (xi) Promptly upon the furnishing thereof to the
                  shareholders of the Borrower, copies of all financial
                  statements, reports, notices and proxy statements so
                  furnished;

                           (xii) Promptly upon the distribution thereof to the
                  press or the public, copies of all press release relating to
                  material events;

                           (xiii) As soon as possible, and in any event within
                  10 days after the Borrower knows of any fire or other casualty
                  or any pending or threatened condemnation or eminent domain
                  proceeding with respect to all or any material portion of any
                  of the Real Estate, a statement signed by a Qualified Officer
                  of Borrower, describing such fire, casualty or condemnation
                  and the action Borrower intends to take with respect thereto;
                  and

                           (xiv) Such supplements to the foregoing documents and
                  such other information and reports (including, without
                  limitation, non-financial information) as the Agent or any
                  Lender may from time to time request.

         8.3 Existence and Conduct of Operations. Except as otherwise expressly
permitted herein, the Borrower shall, and shall cause its Subsidiaries to: (i)
maintain and preserve its existence and all rights, privileges, authorizations
and franchises now enjoyed and necessary for

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<PAGE>

the operation of its business, including remaining in good standing in each
jurisdiction in which business is currently operated; (ii) carry on and conduct
their respective businesses in substantially the same manner and in
substantially the same fields of enterprise as presently conducted; (iii) do all
things necessary to remain duly incorporated and/or duly qualified, validly
existing and in good standing as a corporation, general partnership, limited
liability company or limited partnership, as the case may be, in its
jurisdiction of incorporation/formation; and (iv) maintain all requisite
authority to conduct its business in each jurisdiction in which any of the Real
Estate is located and, except where the failure to be so qualified would not
have a Material Adverse Effect, in each jurisdiction required to carry on and
conduct its businesses in substantially the same manner as it is presently
conducted.

         8.4 Maintenance of Properties. The Borrower shall, and shall cause its
Subsidiaries to, maintain, preserve, protect and keep the Real Estate in good
and safe repair, working order and condition, and make all necessary and proper
repairs, renewals and replacements.

         8.5 Insurance. The Borrower shall, and shall cause its Subsidiaries to,
provide a certificate of insurance from all insurance carriers which have issued
policies with respect to any of their Real Estate within thirty (30) days after
the end of each fiscal year, evidencing that the insurance required to be
furnished to Lenders pursuant to Section 5.1(j) hereof is in full force and
effect. The Agent (for the benefit of the Lenders) shall be named as a loss
payee on each such policy of casualty insurance and as an additional insured on
each such policy of liability insurance, and all such polices of insurance shall
contain provisions to the effect that they may not be canceled or materially
changed without at least 30 days prior notice to the Agent. Borrower shall
timely pay, or cause to be paid, all premiums on all insurance policies required
under this Agreement from time to time. The Borrower shall, and shall cause its
Subsidiaries to, promptly notify the insurance carrier or agent therefor (with a
copy of such notification being provided simultaneously to Agent) if there is
any occurrence which, under the terms of any insurance policy then in effect
with respect to any of their Real Estate, requires such notification.

         8.6 Payment of Obligations. The Borrower shall, and shall cause its
Subsidiaries to, pay all taxes, assessments, governmental charges and other
obligations when due, except such as may be contested in good faith by
appropriate proceedings, and for which adequate reserves have been provided in
accordance with sound accounting principles.

         8.7 Compliance with Laws. The Borrower shall, and shall cause its
Subsidiaries to, comply in all material respects with all applicable laws,
rules, regulations, orders and directions of any governmental authority having
jurisdiction over Borrower, any of its Subsidiaries or any of their respective
businesses or assets.

         8.8 Adequate Books. The Borrower shall, and shall cause its
Subsidiaries to, maintain adequate books, accounts and records in order to
provide financial statements in accordance with GAAP and, if requested by any
Lender, permit employees or representatives of such Lender at any reasonable
time and upon reasonable notice (i) to inspect and audit the assets of the
Borrower and its Subsidiaries, or any of them, (ii) to examine or audit the
inventory,

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<PAGE>

books, accounts and records of each of them and make copies and memoranda
thereof and (iii) to consult with appropriate personnel of each of them
regarding the foregoing.

         8.9 ERISA. The Borrower shall, and shall cause its Subsidiaries to,
comply in all material respects with all requirements of ERISA applicable with
respect to each Plan.

         8.10 Maintenance of Status. LNR shall continue to be a corporation
listed and in good standing on the New York Stock Exchange.

         8.11 Use of Proceeds. The Borrower shall use the proceeds of the
Facility solely for the general business purposes of the Borrower, including,
without limitation, repayment of existing indebtedness, acquisitions and
development of real properties, repurchasing LNR's Common Stock, to the extent
permitted herein, purchasing CMBS and working capital needs.

         8.12 Pre-Acquisition Environmental Investigations. The Borrower shall,
and shall cause its Subsidiaries to, obtain, prior to the acquisition of each
parcel of real property that it intends to acquire, an environmental report of
the scope described in Exhibit I attached hereto and made a part hereof.

         8.13 Joinder of New Subsidiaries. The Borrower shall, from time to
time, promptly cause each Person that becomes a wholly-owned Subsidiary of
Borrower after the Agreement Execution Date to duly execute and deliver to the
Agent either: (i) a joinder agreement pursuant to which such Subsidiary agrees
to become a Borrower hereunder and under the other Loan Documents, assumes all
of the Obligations and agrees that Schedule I hereto and the signature pages to
the Notes shall be amended to include such Subsidiary, all in form and content
satisfactory to the Agent (a "Subsidiary Joinder"); or (ii) at the Agent's
option, a Guaranty of the Obligations. Notwithstanding anything to the contrary
contained herein, such duly executed Subsidiary Joinder or Guaranty, together
with the related documentation required to be furnished pursuant to Section
5.2(c) hereof, shall be delivered to the Agent no later than 15 days after the
end of the fiscal quarter during which such Person became a Subsidiary of
Borrower. If any wholly-owned Subsidiary of Borrower is prohibited from becoming
a Borrower or a Guarantor hereunder by the terms of any bona fide agreement with
an unaffiliated third person entered into by such Subsidiary for legitimate
business reasons, and without any intent to avoid becoming a Borrower or a
Guarantor hereunder, then, in lieu of such Subsidiary becoming a Borrower or a
Guarantor hereunder, Borrower shall pledge all of the stock, partnership
interests, membership interests or other equity or beneficial interests, as the
case may be, in such Subsidiary (a "Pledge Subsidiary") to Agent, for the
benefit of the Lenders, pursuant to a Pledge Agreement in the form of Exhibit C
attached hereto, with appropriate modifications satisfactory to the Agent in the
case of any Pledge Subsidiary that is a partnership, limited liability company
or other non-corporate form of entity (the "Pledge Agreement"). The Pledge
Agreement delivered pursuant to the Original Agreement remains in full force and
effect, and secures the Obligations, with respect to this Agreement.

          8.14 Interest Rate Protection. The Board of Directors of LNR shall
maintain in effect an approved written statement of policy concerning the
mitigation of interest rate risks through

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<PAGE>

the use of Hedging Agreements, or by other appropriate means, with respect to
interest payable on all unsecured Indebtedness of Borrower and its Subsidiaries,
in form and content reasonably satisfactory to Agent, and Borrower and its
Subsidiaries shall at all times act in a manner consistent with said policy, as
the same may be amended from time to time in a manner reasonably acceptable to
the Agent.

         8.15 Investment in Mortgage Subsidiary. The aggregate Investment of
Borrower and its Subsidiaries in the Mortgage Subsidiary shall not exceed
$40,000,000.

                                   ARTICLE IX

                               NEGATIVE COVENANTS

         The Borrower covenants and agrees that, so long as the Commitment shall
remain in effect and until full and final payment of all Obligations incurred
under the Loan Documents, without the prior written consent of the Required
Lenders, it shall not, and shall cause its Subsidiaries not to:

         9.1 Change in Business. Engage in any business activities or operations
other than (i) acquisition, development, ownership, management, operation and
leasing of commercial and industrial real properties (including, without
limitation, multi-family residential, office, retail and warehouse properties)
and ancillary businesses specifically related thereto, (ii) real estate lending
and (iii) Investments in any type of asset which may be included in the
computation of the Borrowing Base pursuant to the definition thereof.

         9.2 Foreign Investments. Permit the aggregate direct or indirect
Investments by LNR and its Subsidiaries in real property or other assets located
outside the United States to exceed 15 percent of Consolidated Tangible Net
Worth.

         9.3 Change of Control. Permit or suffer any Change of Control to occur.

         9.4 Use of Proceeds. Apply or permit to be applied any proceeds of any
Advance directly or indirectly, to the funding of any purchase of, or offer for,
any shares of capital stock of any publicly held corporation constituting (alone
or together with other shares owned by Borrower or its Subsidiaries) a
controlling interest in such corporation, or as part of a series of transactions
to acquire such a controlling interest, unless the board of directors of such
corporation has consented to such purchase or offer and the Lenders have
consented to such use of the proceeds of the Facility.

         9.5 Transfers of Assets. Sell or otherwise dispose of any Real Estate
(other than Real Estate of any Investment Affiliate) or other asset, or any
interest therein, for less than the fair market value thereof.

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<PAGE>

         9.6 Liens. Create, incur, or suffer to exist any Lien in, of or on any
of the Real Estate (other than Real Estate of any Investment Affiliate) except:

                           (i) Liens for taxes, assessments or governmental
                  charges or levies on their Property if the same shall not at
                  the time be delinquent or thereafter can be paid without
                  penalty, or are being contested in good faith and by
                  appropriate proceedings and for which adequate reserves shall
                  have been set aside on their books;

                           (ii) Liens which arise by operation of law, such as
                  carriers', warehousemen's, landlords', materialmen and
                  mechanics' liens and other similar liens arising in the
                  ordinary course of business which secure payment of
                  obligations not more than 30 days past due or which are being
                  contested in good faith by appropriate proceedings and for
                  which adequate reserves shall have been set aside on its
                  books;

                           (iii) Liens arising out of pledges or deposits under
                  worker's compensation laws, unemployment insurance, old age
                  pensions, or other social security or retirement benefits, or
                  similar legislation;

                           (iv) Utility easements, building restrictions, zoning
                  restrictions, easements and such other encumbrances or charges
                  against real property as are of a nature generally existing
                  with respect to properties of a similar character and which do
                  not in any material way affect the marketability of the same
                  or interfere with the use thereof in the business of the
                  Borrower or any of the other Credit Parties;

                           (v) Liens of any Subsidiary in favor of the Borrower
                  (provided that this clause (v) shall no longer permit any such
                  Lien after such Lien or any obligation secured thereby has
                  been transferred, assigned, pledged, hypothecated or otherwise
                  disposed of to any other Person); and

                           (vi) Liens arising in connection with any
                  Indebtedness permitted hereunder (which permitted Indebtedness
                  includes real estate mortgage financing) to the extent such
                  Liens will not result in a violation of any of the provisions
                  of this Agreement. The Liens permitted under this clause (vi)
                  may include Liens that were originally permitted under clause
                  (v) above, but that ceased to be so permitted due to a
                  transfer, assignment, pledge, hypothecation or other
                  disposition thereof or of an obligation secured thereby of the
                  type referred to in the parenthetical of the said clause (v),
                  provided that such Lien satisfies the requirements of this
                  clause (vi) following such transfer, assignment, pledge,
                  hypothecation or other disposition.

Liens permitted pursuant to this Section 9.6 shall be deemed to be "Permitted
Liens".

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<PAGE>

         9.7 Regulation U. Use any of the proceeds of the Advances to purchase
or carry any Margin Stock.

         9.8 Mergers and Dispositions. Enter into any merger, consolidation,
pool, business combination, reorganization or liquidation, or transfer or
otherwise dispose of all or a substantial portion of its properties, except for:
such transactions that occur between wholly-owned Subsidiaries; transactions
where Borrower is the surviving entity and there is no change in business
conducted or loss or material diminution of any credit rating by S&P, Moody's or
any Third Rating, and no Default or Event of Default under the Loan Documents
results from such transaction; or as otherwise approved in advance by the
Lenders.

         9.9 Negative Pledge. Agree with any third party not to create, assume
or suffer to exist any Lien securing a charge or obligation on any of its real
property, whether now owned or hereafter acquired, except that Borrower may
agree with any Person holding a Lien permitted hereunder on any particular asset
not to further encumber such asset so long as such Lien remains in effect.

          9.10 Distributions. Declare, pay or agree to declare or pay to any
Person(s) (other than the Credit Parties) during any fiscal period any dividends
or other distributions on or in respect of its Capital Stock (including, without
limitation, any pro rata redemption or pro rata repurchase of Capital Stock) in
an aggregate amount for all Credit Parties that exceeds the consolidated net
income of Borrower and its Subsidiaries for that fiscal period.

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<PAGE>

                                    ARTICLE X

                                     DEFAULTS

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

         10.1 Nonpayment of Principal. The Borrower fails to pay any principal
portion of the Obligations when due, whether on the Maturity Date or otherwise.

         10.2 Certain Covenants. The Borrower or any of its Subsidiaries is not
in compliance with any one or more of the provisions of Article VII or Article
IX hereof.

         10.3 Nonpayment of Interest and Other Obligations. The Borrower fails
to pay any interest or other portion of the Obligations, other than payments of
principal, and such failure continues for a period of five (5) days after the
date such payment is due.

         10.4 Cross Default. Any monetary default occurs (after giving effect to
any applicable cure period) under any other Indebtedness (which includes
liability under Guaranties) of one or more of Borrower or its Subsidiaries,
singly or in the aggregate, in excess of Five Million Dollars ($5,000,000),
other than (i) Indebtedness arising from the purchase of personal property or
the provision of services, the amount of which is being contested by Borrower in
good faith by appropriate proceedings or (ii) Indebtedness which is
"non-recourse", i.e., which is not recoverable by the creditor thereof from the
general assets of the Borrower or any of its Subsidiaries, but is limited to the
proceeds of certain real estate, improvements and related personal property.

         10.5 Loan Documents. Any Loan Document is not in full force and effect
in accordance with its terms, or a default has occurred and is continuing
thereunder after giving effect to any cure or grace period in any such document.

         10.6 Representation or Warranty. At any time or times hereafter any
representation or warranty set forth in Article VI of this Agreement or in any
other Loan Document or in any statement, report or certificate now or hereafter
made by the Borrower or any of its Subsidiaries to the Lenders or the Agent is
not true and correct in any material respect.

         10.7 Covenants, Agreements and Other Conditions. The Borrower fails to
perform or observe any of the covenants, agreements and conditions contained in
this Agreement or any of the other Loan Documents, not specifically referred to
in any other Section of this Article X, in accordance with the terms hereof or
thereof, and such Default continues unremedied for a period of thirty (30) days
after written notice from Agent, provided, however, that if such Default is
susceptible of cure but cannot by the use of reasonable efforts be cured within
such thirty (30) day period, such Default shall not constitute an Event of
Default under this Section 10.7 so long as (i) the Borrower has commenced a cure
within such thirty-day period in a manner satisfactory to the Agent, and (ii)
thereafter, Borrower is proceeding to cure such default continuously and

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<PAGE>

diligently and in a manner satisfactory to the Agent, and (iii) such default is
fully cured to the Agent's satisfaction not later than sixty (60) days after the
expiration of such thirty (30) day period.

         10.8 [Intentionally Omitted]

         10.9 Material Adverse Financial Change. Any of LNR and its Subsidiaries
comprising Borrower, or any of their respective Subsidiaries, has suffered a
Material Adverse Financial Change or is Insolvent.

         10.10 Bankruptcy.

                  (a) Any of LNR and its Subsidiaries comprising Borrower, or
any of their respective Subsidiaries, shall (i) have an order for relief entered
with respect to it under the Federal bankruptcy laws as now or hereafter in
effect, (ii) make an assignment for the benefit of creditors, (iii) apply for,
seek, consent to, or acquiesce in, the appointment of a receiver, custodian,
trustee, examiner, liquidator or similar official for it or any substantial
portion of its Property or of the property included in the Borrowing Base, (iv)
institute any proceeding seeking an order for relief under the Federal
bankruptcy laws as now or hereafter in effect or seeking to adjudicate it as a
bankrupt or insolvent, or seeking dissolution, winding up, liquidation,
reorganization, arrangement, adjustment or composition of it or its debts under
any law relating to bankruptcy, insolvency or reorganization or relief of
debtors or fail to file an answer or other pleading denying the material
allegations of any such proceeding filed against it, (v) take any corporate
action to authorize or effect any of the foregoing actions set forth in this
Section 10.10(a), (vi) fail to contest in good faith any appointment or
proceeding described in Section 10.10(b) or (vii) not pay, or admit in writing
its inability to pay, its debts generally as they become due.

                  (b) A receiver, trustee, examiner, liquidator or similar
official shall be appointed for any of LNR and its Subsidiaries comprising
Borrower, or any of their respective Subsidiaries, or any substantial portion of
any of their Properties or other material assets, or a proceeding described in
Section 10.10(a)(iv) shall be instituted against any of LNR and its Subsidiaries
comprising Borrower, or any of their respective Subsidiaries, and such
appointment continues undischarged or such proceeding continues undismissed or
unstayed for a period of sixty (60) consecutive days.

         10.11 Legal Proceedings. Any of LNR and its Subsidiaries comprising
Borrower, or any of their respective Subsidiaries, is enjoined, restrained or
otherwise impaired by any court order or judgment or if a notice of lien, levy
or assessment is filed of record with respect to all or any part of their
Properties or other material assets by any governmental department, office,
agency or authority, which, alone or in the aggregate, could have a Material
Adverse Affect, or any proceeding is filed or commenced seeking to enjoin,
restrain or otherwise impair any of the said Persons from conducting all or a
substantial part of their respective business affairs, and such proceeding is
not vacated, stayed, dismissed, set aside, removed or otherwise remedied within
ninety (90) days after the occurrence thereof.

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<PAGE>

         10.12 ERISA. Any of LNR and its Subsidiaries comprising Borrower, or
any of their respective Subsidiaries, is deemed to hold "plan assets" within the
meaning of ERISA or any regulations promulgated thereunder of an employee
benefit plan (as defined in Section 3(3) of ERISA) which is subject to Title I
of ERISA or any plan (within the meaning of Section 4975 of the Code).

         10.13 Failure to Satisfy Judgments. Any of LNR and its Subsidiaries
comprising Borrower, or any of their respective Subsidiaries, shall fail within
sixty (60) days to pay, bond or otherwise discharge any judgments or orders for
the payment of money in an amount which, when added to all other judgments or
orders outstanding against the Borrower or any Subsidiary, would exceed Five
Million Dollars ($5,000,000) in the aggregate, which have not been stayed
pending appeal, unless the liability is insured against and the insurer has not
challenged coverage of such liability.

          10.14 Environmental Remediation. Failure to remediate within the time
period required by law or governmental order (or within a reasonable time in
light of the nature of the problem if no specific time period is so
established), environmental problems in violation of applicable law related to
any of the Real Estate (other than Real Estate of an Investment Affiliate that
is not a Special Investment Affiliate) where the estimated cost of remediation
is in the aggregate in excess of Five Million Dollars ($5,000,000), in each case
after all administrative hearings and appeals have been concluded.

                                   ARTICLE XI

                  ACCELERATION, WAIVERS AMENDMENTS AND REMEDIES

         11.1 Acceleration.

                  If any Event of Default described in Section 10.10 hereof
occurs, the obligation of the Lenders to make Advances and of the Issuing Bank
to issue Facility Letters of Credit hereunder shall automatically terminate and
the Obligations shall immediately become due and payable. If any other Event of
Default described in Article X hereof occurs, such obligation to make Advances
and to issue Facility Letters of Credit shall be terminated and, at the election
of the Required Lenders, the Obligations may be declared to be due and payable.

                  In addition to the foregoing, following the occurrence of an
Event of Default and so long as any Facility Letter of Credit has not been fully
drawn and has not been canceled or expired by its terms, upon demand by the
Agent, the Borrower shall deposit in the Letter of Credit Collateral Account
cash in an amount equal to the aggregate undrawn face amount of all outstanding
Facility Letters of Credit and all fees and other amounts due or which may
become due with respect thereto. The Borrower shall have no control over funds
in the Letter of Credit Collateral Account, which funds shall be invested by the
Agent from time to time in its discretion in certificates of deposit of Bank of
America having a maturity not exceeding thirty (30) days. Such funds and any
interest thereon shall be promptly applied by the Agent to reimburse the Issuing

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<PAGE>

Bank for drafts drawn from time to time under the Facility Letters of Credit.
Such funds, if any, remaining in the Letter of Credit Collateral Account
following the payment of all Obligations in full shall, unless the Agent is
otherwise directed by a court of competent jurisdiction, be promptly paid over
to the Person(s) entitled to the same.

         11.2 Preservation of Rights; Amendments. No delay or omission of the
Lenders in exercising any right under the Loan Documents shall impair such right
or be construed to be a waiver of any Default or Event of Default or an
acquiescence therein, and the making of an Advance notwithstanding the existence
of a Default or Event of Default or the inability of the Borrower to satisfy any
conditions precedent to such Advance shall not constitute any waiver or
acquiescence. Any single or partial exercise of any such right shall not
preclude other or further exercise thereof or the exercise of any other right,
and no waiver, amendment, release or other variation of the terms, conditions or
provisions of the Loan Documents whatsoever shall be valid unless in writing
signed by the Agent and the number of Lenders required hereunder and then only
to the extent in such writing specifically set forth. All remedies contained in
the Loan Documents or by law afforded shall be cumulative, and may be exercised
concurrently or successively, and all shall be available to the Lenders until
the Obligations have been paid in full.

                                   ARTICLE XII

                            THE ADMINISTRATIVE AGENT

         12.1 Appointment. Bank of America is hereby irrevocably appointed as
administrative agent hereunder and under each other Loan Document, and each of
the Lenders irrevocably authorizes the Agent to act as the agent of such Lender.
The Agent agrees to act as such upon the express conditions contained in this
Article XII. The Agent shall not have any duties or responsibilities except
those expressly set forth herein and shall not have a fiduciary relationship in
respect of any Lender by reason of this Agreement. U.S. Bank, National
Association, Fleet National Bank and Guaranty Federal Bank, F.S.B., are hereby
irrevocably appointed as the Syndication Agent, the Documentation Agent and the
Managing Agent, respectively. The Syndication Agent, the Documentation Agent and
the Managing Agent have no duties or responsibilities to the Lenders in that
capacity, in connection with the administration of the Facility or otherwise.
Banc of America Securities LLC is hereby acknowledged to be the Sole Lead
Arranger and Sole Book Manager for the Facility, but shall have no liabilities
or obligations under this Agreement, in that capacity or otherwise.

         12.2 Powers. The Agent shall have and may exercise such powers under
the Loan Documents as are specifically delegated to the Agent by the terms of
each thereof, together with such powers as are reasonably incidental thereto.
The Agent shall have no implied duties, obligations or liabilities to the
Lenders, or any obligation to the Lenders to take any action thereunder except
any action specifically provided by the Loan Documents to be taken by the Agent.
Only Agent may perform the duties reserved to it under the Loan Documents and no
Lender shall act or purport to act on behalf of the other Lenders or Agent on
any such matters. Without limiting the generality of the foregoing:

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                  (a) Agent shall have the exclusive right to collect from
Borrower and any Guarantor, or third parties, on account of the Facility,
including, principal, interest, fees, protective advances and prepayment
premiums (if any), whether such sums are received directly from Borrower, any
Guarantor, or any other Persons, or obtained by right of offset by Agent of any
kind, or by enforcement of the Loan Documents. Agent will receive and hold all
collections with respect to the Obligations for the benefit of the Lenders in
accordance with their Percentages or as otherwise provided herein.

                  (b) If any Lender shall receive any payments or property in
connection with the Facility (whether or not voluntary), except from Agent, that
Lender shall transfer to Agent all such funds or property within one Business
Day of receipt.

                  (c) So long as the Agent and the Required Lenders act
reasonably and in good faith in determining how to respond to and responding to
any Event of Default hereunder following the maturity of the Facility or any
acceleration of the Obligations, no Lender shall independently initiate any
judicial action or other proceeding against Borrower or any Guarantor with
respect to the Facility, either before or after any such maturity or
acceleration, the right to initiate any such proceeding on behalf of the Lenders
being expressly reserved to the Agent.

         12.3 General Immunity. Neither the Agent nor any of its directors,
officers, agents or employees shall be liable to the Borrower, the Lenders or
any Lender for any action taken or omitted to be taken by it or them hereunder
or under any other Loan Document or in connection herewith or therewith, except
for its or their own gross negligence or willful misconduct.

         12.4 No Responsibility for Loans, Recitals, etc.. Neither the Agent nor
any of its directors, officers, agents or employees shall be responsible for or
have any duty to ascertain, inquire into, or verify (i) any statement, warranty
or representation made in connection with any Loan Document or any borrowing
hereunder; (ii) the performance or observance of any of the covenants or
agreements of any obligor under any Loan Document; (iii) the satisfaction of any
condition specified in Article V, except receipt of items required to be
delivered to the Agent; or (iv) the validity, effectiveness or genuineness of
any Loan Document or any other instrument or writing furnished in connection
therewith.

         12.5 Action on Instructions of Lenders. The Agent shall in all cases be
fully protected in acting, or in refraining from acting, hereunder and under any
other Loan Document in accordance with written instructions signed by the
Required Lenders (or such greater number of Lenders as may be specifically
required herein in connection with any particular matter), and such instructions
and any action taken or failure to act pursuant thereto shall be binding on all
of the Lenders and on all holders of Notes. The Agent shall be fully justified
in failing or refusing to take any action hereunder and under any other Loan
Document unless it shall first receive such advice or concurrence, if it so
requests, of the Required Lenders (or such greater number of Lenders as may be
specifically required herein in connection with any particular matter), and
shall first be indemnified to its satisfaction by the Lenders pro rata against
any and all liability, cost and expense that it may incur by reason of taking or
continuing to take any such action.

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         12.6 Employment of Agents and Counsel. The Agent may execute any of its
duties as Agent hereunder and under any other Loan Document by or through
employees, agents and attorneys-in-fact and shall not be answerable to the
Lenders, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The Agent shall be entitled to engage and
rely upon advice of legal counsel (including the Borrower's counsel),
independent accountants and other professionals and experts selected by the
Agent concerning all matters pertaining to the agency hereby created and its
duties hereunder and under any other Loan Document.

         12.7 Reliance on Documents; Counsel. The Agent shall be entitled to
rely upon any Note, writing, notice, consent, certificate, facsimile, affidavit,
letter, telegram, statement, paper, document or other communication believed by
it to be genuine and correct and to have been signed, sent or otherwise
communicated by the proper person or persons.

         12.8 Agent's Reimbursement and Indemnification. The Lenders agree to
reimburse and indemnify upon demand the Agent ratably in accordance with their
respective Percentages (i) for any amounts not reimbursed by the Borrower for
which the Agent is entitled to reimbursement by the Borrower under the Loan
Documents, (ii) for any other expenses (including, attorneys' fees) incurred by
the Agent on behalf of the Lenders, in connection with the preparation,
execution, delivery, administration, modification and enforcement of the Loan
Documents, if not paid by Borrower, and (iii) for any liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind and nature whatsoever which may be imposed on,
incurred by or asserted against the Agent, in its capacity as such, in any way
relating to or arising out of the Loan Documents or any other document delivered
in connection therewith or the transactions contemplated thereby, or the
enforcement of any of the terms thereof or of any such other documents, provided
that no Lender shall be liable for any of the foregoing to the extent they arise
from the gross negligence or willful misconduct of the Agent. Each Lender shall
indemnify the Agent and the other Lenders with respect to claims, liabilities,
damages, costs, losses and expenses (including, without limitation, attorneys'
fees) arising from or relating to the failure of such indemnifying Lender to
satisfy its obligations under this Agreement and the other Loan Documents.

         12.9 Rights as a Lender. With respect to the Commitment, Advances made
by it, the Note issued to it and otherwise, the Agent shall have the same rights
and powers hereunder and under any other Loan Document as any Lender and may
exercise the same as though it were not the Agent, and the term "Lender" or
"Lenders" shall, unless the context otherwise indicates, include the Agent in
its capacity as a Lender. The Agent, in its capacity as a Lender, and each of
the other Lenders, may accept deposits from, lend money to, and generally engage
in any kind of trust, debt, equity or other transaction, in addition to those
contemplated by this Agreement or any other Loan Document, with the Borrower or
any of its Subsidiaries in which the Borrower or such Subsidiary is not
restricted hereby from engaging with any other Person. The Lenders acknowledge
that Agent, each of the other Lenders and each of their respective Affiliates
now or in the future may have banking or other financial relationships,
including being an agent on other loans, with Borrower and its Affiliates, as
though Bank of America were not Agent hereunder or as though such other Lender
were not a Lender hereunder, as the case may be, and without notice

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to or consent of the Lenders. Each Lender hereby expressly waives any objection
to such actual or potential conflict of interest. The Lenders acknowledge that
in the course of such activities, Bank of America, each of the other Lenders and
each of their respective Affiliates may receive information regarding Borrower
or its Affiliates and acknowledge that neither the Agent, such other Lender nor
such Affiliate shall be under any obligation to provide such information to
them, whether or not confidential.

         12.10 Commitment as a Lender. Bank of America agrees to maintain at all
times a Stated Commitment of at least ten percent (10%) of all of the Stated
Commitments so long as Bank of America remains as Agent; provided, that the
foregoing agreement of Bank of America shall not apply at any time following a
Monetary Default or Event of Default (irrespective of whether such Monetary
Default or Event of Default subsequently is waived). If Bank of America's
initial Stated Commitment is greater than $75,000,000, Bank of America shall
have the right to reduce its Stated Commitment to $75,000,000 by giving written
notice of such reduction to the Borrower and the Lenders within one hundred and
eighty (180) days after the date hereof, which reduction shall occur
automatically, and without further documentation among the parties hereto, upon
the giving of timely notice as aforesaid.

         12.11 Lender Credit Decision. Each Lender acknowledges that neither the
Agent nor any of its agents has made any representation or warranty to such
Lender and that no action or statement hereafter made or taken by the Agent or
any of its agents shall be deemed to be representation or warranty by the Agent
to such Lenders. Each Lender further acknowledges that it has, independently and
without reliance upon the Agent or any other Lender and based on the financial
statements prepared by the Borrower and such other documents and information as
it has deemed appropriate, made its own credit analysis and decision to enter
into this Agreement and the other Loan Documents. Each Lender also acknowledges
that it will, independently and without reliance upon the Agent or any other
Lender and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit analysis and decisions in taking or
not taking action under this Agreement and the other Loan Documents.

         12.12 Successor Agent. Each Lender agrees that Bank of America shall
serve as Agent at all times during the term of this Facility, except that Bank
of America may resign as Agent at any time, in its sole discretion, upon thirty
(30) days' prior written notice to the Lenders and Borrower. Upon any such
resignation, the Required Lenders shall have the right to appoint, on behalf of
the Borrower and the Lenders, a successor Agent. If no successor Agent shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within thirty (30) days after the retiring Agent's giving notice of
resignation, then the retiring Agent may appoint, on behalf of the Borrower and
the Lenders, a successor Agent. Such successor Agent shall be a commercial bank
having capital and retained earnings of at least $100,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Agent (including the right
to receive any fees for performing such duties which accrue thereafter), and the
retiring Agent shall be discharged from its duties and obligations hereunder and
under the other Loan Documents. After any retiring Agent's resignation hereunder
as Agent, the provisions of this Article XII shall continue in effect for its

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benefit and that of the other Lenders in respect of any actions taken or omitted
to be taken by it while it was acting as the Agent hereunder and under the other
Loan Documents.

         12.13 Notice of Defaults. If a Lender becomes aware of a Default or
Event of Default, such Lender shall notify the Agent of such fact. Upon receipt
of such notice that a Default or Event of Default has occurred, the Agent shall
notify each of the Lenders, including, without limitation, the Swingline Lender,
of such fact. Except for defaults in the payment of principal, interest and fees
payable to Agent for the account of the Lenders and such other Obligations for
which Agent is expressly responsible for determining Borrower's compliance,
Agent shall not be deemed to have knowledge or notice of the occurrence of any
Default or Event of Default, unless Agent shall have received written notice
from a Lender or Borrower referring to the Loan, describing such Default or
Event of Default and stating that such notice is a "notice of default". Agent
will notify the Lenders of its receipt of any such notice. Agent shall take
action with respect to such Default or Event of Default in accordance with the
provisions of this Agreement and the Loan Documents.

         12.14 Requests for Approval. If the Agent requests in writing the
consent or approval of a Lender, whether or not such consent or approval is
required hereunder (and no such requirement shall be inferred from any such
request), such Lender shall respond and either approve or disapprove
definitively in writing to the Agent within ten (10) Business Days (or sooner if
such notice specifies a shorter period based on Agent's good faith determination
that circumstances exist warranting its request for an earlier response) after
such written request from the Agent. If any Lender does not so respond, that
Lender shall be deemed to have approved the request.

         12.15 Copies of Documents. Agent shall promptly deliver to each of the
Lenders copies of all notices of default and other formal notices sent to or
received by the Agent pursuant to Section 15.1 of this Agreement. Within fifteen
(15) Business Days after a request by a Lender to the Agent for other documents
furnished to the Agent by the Borrower, the Agent shall provide copies of such
documents to such Lender except where this Agreement obligates Agent to provide
copies in a shorter period of time.

         12.16 Defaulting Lenders. At such time as a Lender becomes a Defaulting
Lender, such Defaulting Lender's right to vote on matters which are subject to
the consent or approval of the Required Lenders, such Defaulting Lender or all
Lenders shall be immediately suspended until such time as the Lender is no
longer a Defaulting Lender. If a Defaulting Lender has failed to fund its
Percentage of any Advance and until such time as such Defaulting Lender
subsequently funds its Percentage of such Advance, all Obligations owing to such
Defaulting Lender hereunder shall be subordinated in right of payment, as
provided in the following sentence, to the prior payment in full of all
principal of, interest on and fees relating to the Loans funded by the other
Lenders in connection with any such Advance in which the Defaulting Lender has
not funded its Percentage (such principal, interest and fees being referred to
as "Senior Loans" for the purposes of this section). All amounts paid by the
Borrower and otherwise due to be applied to the Obligations owing to such
Defaulting Lender pursuant to the terms hereof shall be distributed by the Agent
to the other Lenders in accordance with their respective Percentages

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(recalculated for the purposes hereof to exclude the Defaulting Lender) until
all Senior Loans have been paid in full. At that point, the "Defaulting Lender"
shall no longer be deemed a Defaulting Lender. After the Senior Loans have been
paid in full equitable adjustments will be made in connection with future
payments by the Borrower to the extent a portion of the Senior Loans had been
repaid with amounts that otherwise would have been distributed to a Defaulting
Lender but for the operation of this Section 12.16. This provision governs only
the relationship among the Agent, each Defaulting Lender and the other Lenders;
nothing hereunder shall limit the obligation of the Borrower to repay all Loans
in accordance with the terms of this Agreement. The provisions of this Section
12.16 shall apply and be effective regardless of whether a Default occurs and is
continuing, and notwithstanding (i) any other provision of this Agreement to the
contrary, (ii) any instruction of the Borrower as to its desired application of
payments or (iii) the suspension of such Defaulting Lender's right to vote on
matters as provided above.

         12.17 Withholding Tax. All taxes due and payable on any payments to be
made to a Lender under this Agreement shall be such Lender's sole
responsibility, except to the extent such taxes are actually reimbursed by
Borrower under the Loan Documents. All payments to be made to each Lender under
this Agreement shall be made after deduction for any taxes, charges, levies or
withholdings which are imposed by the country of incorporation of Borrower, the
United States of America or any other applicable taxing authority. Each Lender
agrees to provide to Agent completed and signed copies of any forms that may be
required by the United States Internal Revenue Service (and any applicable state
authority) in order to certify such Lender's exemption from or reduction of
United States (or applicable state) withholding taxes with respect to payments
to be made to such Lender under this Agreement or the Loan Documents. Each
Lender agrees to promptly notify Agent of any change which would modify or
render invalid any claimed exemption or reduction, or of any sale, assignment,
participation, or other transfer by such Lender of all or part of its interest
in the Facility. If any governmental authority of the United States or other
jurisdiction asserts a claim that Agent did not properly withhold tax from
amounts paid to or for the account of any Lender, such Lender shall indemnify
Agent fully for all amounts paid by Agent as tax or otherwise, including
penalties and interest, and including any taxes imposed by any jurisdiction on
the amount payable to Agent under this section, together with all costs and
expenses (including legal expenses). The obligation of the Lenders under this
subsection shall survive the payment of all Obligations and the resignation or
replacement of Agent.

         12.18 Borrower's Default; Enforcement. Upon the occurrence of an Event
of Default under any Loan Document, the Required Lenders shall have the right,
upon written notice to Agent, to require that Agent exercise the rights of the
Lenders as directed by the Required Lenders; provided, however, that the Lenders
shall indemnify, exonerate and hold Agent harmless from and against any and all
claims, losses, liabilities, damages and costs (including reasonable legal fees)
incurred by Agent as a result of any such exercise of rights at the direction of
the Lenders.

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         12.19 [Intentionally Omitted]

         12.20 Bankruptcy of Borrower. In the event of a bankruptcy by Borrower,
the Lenders shall act through Agent to petition the court, make any motion for
relief from the automatic stay, participate in any appropriate creditors'
committee, vote on a plan of reorganization or pursue other remedies or actions
in accordance with the approval of the Required Lenders.

         12.21 Relationship of Parties. This Agreement is not intended to
establish a partnership or joint venture between Agent and the Lenders. The
provisions of the Loan Documents regarding the relationships among Agent and the
Lenders and this Article XII is intended solely to facilitate co-lending
relationships among the Lenders for the Facility. No security or investment
contract under any federal or state law is intended to be created among the
Lenders or between Agent and the Lenders. The execution of this Agreement, the
performance of the terms thereof, and the Lenders' purchase of and ownership
interest in the Facility and the Loan Documents shall not constitute any Lender
as owner, purchaser or seller of any security (as that term is defined in the
Securities Act of 1933 or the Securities Exchange Act of 1934) issued, owned,
purchased or sold by Bank of America or any of its Subsidiaries or Affiliates,
either as principal or as agent for Borrower. Each Lender is purchasing and
acquiring legal and equitable ownership of its Percentage and is not making a
loan to Bank of America, and no debtor-creditor relationship exists between them
as a result of this Agreement.

         12.22 [Intentionally Omitted]

                                  ARTICLE XIII

                BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS

         13.1 Successors and Assigns.

                  The terms and provisions of the Loan Documents shall be
binding upon and inure to the benefit of Borrower and the Lenders and their
respective successors and assigns, except that the Borrower shall not have the
right to assign its rights or obligations under the Loan Documents without the
consent of all the Lenders and any assignment by any Lender must be made in
compliance with Section 13.3. The Agent may treat the payee of any Note as the
owner thereof for all purposes hereof unless and until such payee complies with
Section 13.3 in the case of an assignment thereof or, in the case of any other
transfer, a written notice of the transfer is filed with the Agent. Any assignee
or transferee of a Note agrees by acceptance thereof to be bound by all the
terms and provisions of the Loan Documents. Any request, authority or consent of
any Person who at the time of making such request or giving such authority or
consent is the holder of any Note, shall be conclusive and binding on any
subsequent holder, transferee or assignee of such Note or of any Note or Notes
issued in exchange therefor.

         13.2 Participations.

                  13.2.1 Permitted Participants: Effect. Any Lender may, in the
         ordinary course of its business and in accordance with applicable law,
         at any time sell to one or more banks or other entities
         ("Participants") participating interests in any Advance owing to such
         Lender, any Note held by such Lender, any Commitment of such Lender or
         any other

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         interest of such Lender under the Loan Documents. In the event of any
         such sale by a Lender of participating interests to a Participant, such
         Lender's obligations under the Loan Documents shall remain unchanged,
         such Lender shall remain solely responsible to the other parties hereto
         for the performance of such obligations, such Lender shall remain the
         holder of any such Note for all purposes under the Loan Documents, all
         amounts payable by Borrower under this Agreement shall be determined as
         if such Lender had not sold such participating interests, and Borrower
         and the Agent and the other Lenders shall continue to deal solely and
         directly with such Lender in connection with such Lender's rights and
         obligations under the Loan Documents.

                  13.2.2 Voting Rights. Each Lender shall retain the sole right
         to vote its Percentage of the Aggregate Commitment, without the consent
         of any Participant, for the approval or disapproval of any amendment,
         modification or waiver of any provision of the Loan Documents, provided
         that such Lender may grant such Participant the right to approve any
         amendment, modification or waiver which forgives principal, interest or
         fees or reduces the interest rate or fees payable hereunder, postpones
         any date fixed for any regularly-scheduled payment of principal of or
         interest on the Obligations, releases Collateral beyond any releases
         expressly provided for herein or extends the Maturity Date.

         13.3 Assignments.

                  13.3.1 Permitted Assignments. Any Lender may, with the prior
         written consent of Agent and Borrower (which consents shall not be
         unreasonably withheld or delayed), in accordance with applicable law,
         at any time assign to one or more banks or other entities
         (collectively, "Purchasers") all or any part of its rights and
         obligations under the Loan Documents; provided, however, that following
         any such partial assignment, the assigning Lender's Stated Commitment
         shall not be less than $5,000,000; and provided further that no consent
         of Borrower shall be required if a Monetary Default, other material
         Default or Event of Default has occurred and is continuing, and no
         consent of Agent or Borrower shall ever be required for (i) any
         assignment to a Person now or hereafter directly or indirectly
         controlling, controlled by or under direct or indirect common control
         with the assigning Lender or (ii) the pledge or assignment by a Lender
         of such Lender's Note and other rights under the Loan Documents to any
         Federal Reserve Bank in accordance with applicable law. Such
         assignments and assumptions shall be substantially in the form of
         Exhibit J hereto. The Borrower shall execute any and all documents
         which are customarily required by such Lender (including, without
         limitation, a replacement promissory note or notes in the forms
         provided hereunder) in connection with any such assignment, but
         Borrower shall not be obligated to pay any fees and expenses incurred
         by any Lender in connection with any assignment pursuant to this
         Section. Any Lender selling all or any part of its rights and
         obligation hereunder in a transaction requiring the consent of the
         Agent shall pay to the Agent a fee of $3,500 per assignee to reimburse
         Agent for its involvement in such assignment.

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                  13.3.2 Effect: Effective Date of Assignment. Upon delivery to
         the Agent of a notice of assignment executed by the assigning Lender
         and the Purchaser, such assignment shall become effective on the
         effective date specified in such notice of assignment. The notice of
         assignment shall contain an undertaking by the Purchaser to be bound as
         a Lender by this Agreement and the other Loan Documents with the same
         force and effect as if it were an original signatory hereto, and a
         representation by the Purchaser to the effect that none of the
         consideration used to make the purchase of the Commitment and the Loan
         under the applicable assignment agreement are "plan assets" as defined
         under ERISA and that the rights and interests of the Purchaser in and
         under the Loan Documents will not be "plan assets" under ERISA, all in
         form and content satisfactory to the Agent. On and after the effective
         date of such assignment, such Purchaser shall for all purposes be a
         Lender party to this Agreement and any other Loan Document executed by
         the Lenders and shall have all the rights and obligations of a Lender
         under the Loan Documents, to the same extent as if it were an original
         party hereto, and no further consent or action by Borrower, the Lenders
         or the Agent shall be required to release the transferor Lender with
         respect to the percentage of the Commitment and Advances assigned to
         such Purchaser. Upon the consummation of any assignment to a Purchaser
         pursuant to this Section 13.3.2, the transferor Lender, the Agent and
         Borrower shall make appropriate arrangements so that replacement Notes
         are issued to such transferor Lender and new Notes or, as appropriate,
         replacement Notes, are issued to such Purchaser, in each case in
         principal amounts reflecting their respective Commitments, as adjusted
         pursuant to such assignment.

         13.4 Dissemination of Information. Borrower authorizes each Lender to
disclose to any Participant or Purchaser or any other Person acquiring an
interest in the Loan Documents by operation of law (each a "Transferee") and any
prospective Transferee any and all information in such Lender's possession
concerning the creditworthiness of Borrower and its Subsidiaries. Each
Transferee shall agree to keep confidential any such information which is not
publicly available.

         13.5 Tax Treatment. If any interest in any Loan Document is transferred
to any Transferee which is organized under the laws of any jurisdiction other
than the United States or any State thereof, the transferor Lender shall cause
such Transferee, concurrently with the effectiveness of such transfer, to comply
with all applicable provisions of the Code with respect to withholding and other
tax matters.

                                   ARTICLE XIV

                               GENERAL PROVISIONS

         14.1 Survival of Representations. All representations and warranties
contained in this Agreement shall survive delivery of the Notes and the making
of the Advances herein contemplated.

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         14.2 Governmental Regulation. Anything contained in this Agreement to
the contrary notwithstanding, no Lender shall be obligated to extend credit to
the Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.

         14.3 Taxes. Any recording and other taxes (excluding franchise, income
or similar taxes) or other similar assessments or charges payable or ruled
payable by any governmental authority incurred in connection with the
consummation of the transactions contemplated by this Agreement shall be paid by
the Borrower, together with interest and penalties, if any.

         14.4 Headings. Section headings in the Loan Documents are for
convenience of reference only, and shall not govern the interpretation of any of
the provisions of the Loan Documents.

         14.5 No Third Party Beneficiaries. This Agreement shall not be
construed so as to confer any right or benefit upon any Person other than the
parties to this Agreement and their respective successors and assigns.

         14.6 Expenses: Indemnification. Subject to the provisions of this
Agreement, Borrower will pay (a) all out-of-pocket costs and expenses incurred
by the Agent (including the reasonable fees, out-of-pocket expenses and other
reasonable expenses of counsel, which counsel may be employees of Agent) in
connection with the syndication of the Facility and the preparation, execution
and delivery of this Agreement, the Notes, the Loan Documents and any other
agreements or documents referred to herein or therein and any amendments
thereto, (b) all out-of-pocket costs and expenses incurred by the Agent and each
of the Lenders (including the reasonable fees, out-of-pocket expenses and other
reasonable expenses of counsel to the Agent and the Lenders, which counsel may
be employees of Agent or the Lenders) in connection with the enforcement and
protection of the rights of the Lenders under this Agreement, the Notes, the
Loan Documents or any other agreement or document referred to herein or therein,
and (c) all reasonable and customary costs and expenses of periodic audits by
the Agent's personnel of the Borrower's books and records provided that prior to
an Event of Default, Borrower shall not be required to pay for more than one
such audit during any year and the cost thereof to Borrower shall not exceed
$6,000. The Borrower further agrees to indemnify the Lenders, their directors,
officers and employees against all losses, claims, damages, penalties,
judgments, liabilities and reasonable expenses (including, without limitation,
all attorneys' fees and expenses of litigation or preparation therefor, whether
or not the Lenders are a party thereto) which any of them may pay or incur
arising out of or relating to this Agreement, the other Loan Documents, the
transactions contemplated hereby or the direct or indirect application or
proposed application of the proceeds of any Advance hereunder, including,
without limitation, any such losses, claims, damages, penalties, judgments,
liabilities and reasonable expenses (including, without limitation, attorneys'
fees) arising out of or relating to any violation of any Environmental Laws with
respect to any Borrower or Real Estate, or any Materials of Environmental
Concern with respect to any Borrower or Real Estate, except that the foregoing
indemnity shall not apply to a Lender to the extent that any losses, claims,
etc. are the result of such Lender's gross negligence or willful misconduct. The
obligations of the Borrower under this Section shall survive the termination of
this Agreement.

                                       79
<PAGE>

         14.7 Severability of Provisions. Any provision in any Loan Document
that is held to be inoperative, unenforceable, or invalid in any jurisdiction
shall, as to that jurisdiction, be inoperative, unenforceable, or invalid
without affecting the remaining provisions in that jurisdiction or the
operation, enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of all Loan Documents are declared
to be severable.

         14.8 Nonliability of the Lenders. The relationship between the Borrower
and the Lenders shall be solely that of borrower and lender. Neither the Agent
nor the Lenders shall have any fiduciary responsibilities to the Borrower.
Neither the Agent nor the Lenders undertake any responsibility to the Borrower
to review or inform the Borrower of any matter in connection with any phase of
the Borrower's business or operations.

         14.9 Choice of Law. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF ILLINOIS, BUT
GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.

         14.10 Consent to Jurisdiction. THE BORROWER HEREBY IRREVOCABLY SUBMITS
TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS STATE
COURT SITTING IN CHICAGO, ILLINOIS IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO ANY LOAN DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES THAT
ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED
IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER
HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A
COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT
THE RIGHT OF THE LENDERS TO BRING PROCEEDINGS AGAINST THE BORROWER IN THE COURTS
OF ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE
LENDERS OR ANY AFFILIATE OF THE LENDERS INVOLVING, DIRECTLY OR INDIRECTLY, ANY
MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN
DOCUMENT SHALL BE BROUGHT ONLY IN A COURT IN CHICAGO, ILLINOIS.

         14.11 Waiver of Jury Trial. THE BORROWER, THE AGENT AND THE LENDERS
HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY
WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR THE
RELATIONSHIP ESTABLISHED THEREUNDER.

                                       80
<PAGE>

         14.12 Joint and Several Liability. All of the liabilities and
obligations of the entities included in Borrower under and in connection with
the Loan Documents shall be joint and several.

         14.13 Entire Agreement; Modification of Agreement. The Loan Documents
embody the entire agreement among the Borrower, the Agent, and the Lenders and
supersede all prior conversations, agreements, understandings, commitments and
term sheets among any or all of such parties with respect to the subject matter
hereof. Any provisions of this Agreement may be amended or waived, or any
liability thereunder released, if, but only if, such amendment or waiver is in
writing and is signed by the Borrower, and Agent if the rights or duties of
Agent are affected thereby, and

                  (a) each of the Lenders if such amendment or waiver

                           (i) reduces or forgives any payment of principal or
                  interest on the Obligations or any fees payable by Borrower to
                  such Lender hereunder; or

                           (ii) postpones the date fixed for any payment of
                  principal of or interest on the Obligations or any fees
                  payable by Borrower to such Lender hereunder; or

                           (iii) changes the amount of such Lender's Commitment
                  (other than pursuant to an assignment permitted under Section
                  13.3) or the unpaid principal amount of such Lender's Note; or

                           (iv) extends the Maturity Date;

                           (v) modifies the definition of "Event of Default"
                  (provided, however, that, except as provided in clauses (i),
                  (ii) and (iv) of this subsection (a), any waiver of an Event
                  of Default shall not be subject to this subsection (a), but
                  shall be subject to subsection (b) below); or

                           (vi) changes the definition of "Required Lenders" or
                  modifies any requirement for consent by each of the Lenders
                  under this Section 14.13(a).

                  (b) the Required Lenders, as to all other matters.

         14.14 Dealings with the Borrower. The Lenders and their affiliates may
accept deposits from, extend credit to and generally engage in any kind of
banking, trust or other business with the Borrower or the Borrower or any of
their Affiliates regardless of the capacity of the Lenders hereunder.

         14.15 Set-Off.

                  (a) If an Event of Default shall have occurred, each Lender
shall have the right, at any time and from time to time without notice to the
Borrower, any such notice being

                                       81
<PAGE>

hereby expressly waived, to set-off and to appropriate or apply any and all
deposits of money or property or any other indebtedness at any time held or
owing by such Lender to or for the credit or the account of the Borrower against
and on account of all outstanding Obligations and all Obligations which from
time to time may become due hereunder and all other obligations and liabilities
of the Borrower under this Agreement, irrespective of whether or not such Lender
shall have made any demand hereunder and whether or not said obligations and
liabilities shall have matured.

                  (b) Each Lender agrees that if it shall, by exercising any
right of set-off or counterclaim or otherwise, receive payment of a proportion
of the aggregate amount of principal, interest or fees due with respect to any
Note held by it which is greater than the proportion received by any other
Lender in respect of the aggregate amount of principal, interest or fees due
with respect to any Note held by such other Lender, the Lender receiving such
proportionately greater payment shall purchase such participations in the Notes
held by the other Lenders and such other adjustments shall be made as may be
required so that all such payments of principal, interest or Fees with respect
to the Notes held by the Lenders shall be shared by the Lenders pro rata
according to their respective Commitments.

         14.16 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one agreement, and
any of the parties hereto may execute this Agreement by signing any such
counterpart. This Agreement shall be effective when it has been executed by the
Borrower and each of the Lenders shown on the signature pages hereof.

         14.17 [Intentionally Omitted]

         14.18 Rights of Contribution among Credit Parties.

                  (a) Each Credit Party hereby or by the execution and delivery
of a Guaranty (as the case may be) agrees, as between itself and any other
Credit Party, that if any other Credit Party shall become an Excess Funding
Party (as defined below) by reason of the payment by it of any Obligations, such
Credit Party shall, on demand of such Excess Funding Party (but subject to the
next sentence), pay to such Excess Funding Party an amount equal to such Credit
Party's Pro Rata Share (as defined below and determined, for this purpose,
without reference to the properties, debts and liabilities of such Excess
Funding Party) of the Excess Payment (as defined below) in respect of such
Obligations. The payment obligation of such Credit Party to any Excess Funding
Party under this Section 14.18 shall be subordinate and subject in right of
payment to the prior payment in full of the other obligations of such Credit
Party under this Agreement or its Guaranty, as the case may be, and such Excess
Funding Party shall not exercise any right or remedy with respect to such excess
until payment and satisfaction in full of all of such other obligations.

                  (b) For purposes of this Section 14.18: (i) "Excess Funding
Party" shall mean, in respect of any Obligations, a Credit Party that has paid
an amount in excess of its Pro Rata Share of such Obligations; (ii) "Excess
Payment" shall mean, in respect of any Obligations, the amount paid by an Excess
Funding Party in excess of its Pro Rata Shares of such Obligations;

                                       82
<PAGE>

and (iii) "Pro Rata Share" shall mean, for any Credit Party, the ratio
(expressed as a percentage) of (x) the amount by which the aggregate fair
salable value of all properties of such Credit Party (excluding any shares of
stock of any other Credit Party) exceeds the amount of all the debts and
liabilities of such Credit Party (including contingent, subordinated, unmatured
and unliquidated liabilities, but excluding the obligations of such Credit Party
hereunder or under its Guaranty, as the case may be, and any obligations of any
other Credit Party that have been guaranteed by such Credit Party) to (y) the
amount by which the aggregate fair salable value of all properties of all of the
Credit Parties, including such Credit Party, exceeds the amount of all the debts
and liabilities (including contingent, subordinated, unmatured and unliquidated
liabilities, but excluding the obligations of the Credit Parties hereunder and
under the respective Guaranties) of all of the Credit Parties, including such
Credit Party, as of the Agreement Execution Date. If any entity becomes a Credit
Party subsequent to the Agreement Execution Date, then for purposes of this
Section 14.18 such subsequent Credit Party shall be deemed to have been a Credit
Party as of the Agreement Execution Date and the aggregate present fair salable
value of properties, and the amount of the debts and liabilities, of such Credit
Party as of the Agreement Execution Date shall be deemed to be equal to such
value and amount on the date such Credit Party becomes a Credit Party.

         14.19 General Limitation on Obligations. In any action or proceeding
involving any state corporate law, or any sate or Federal bankruptcy,
insolvency, reorganization or other law affecting the rights of creditors
generally, if the obligations of Credit Party under this Agreement or its
Guaranty, as the case may be, would otherwise, taking into account the
provisions of Section 14.18 hereof, be held or determined to be void, invalid or
unenforceable, or subordinated to the claims of any other creditors, on account
of the amount of its liability under this Agreement or its Guaranty, as the case
may be, then, notwithstanding any other provision hereof to the contrary, the
amount of such liability shall, without any further action by the Credit Party,
the Agent, the Lenders or any other Person, be automatically limited and reduced
to the highest amount that is valid and enforceable and not subordinated to the
claims of other creditors as determined in such action or proceeding.

                                   ARTICLE XV

                                     NOTICES

         15.1 Giving Notice. All notices and other communications provided to
any party hereto under this Agreement or any other Loan Document shall be in
writing or by telex or by facsimile and addressed or delivered to such party at
its address set forth below or at such other address as may be designated by
such party in a notice to the other parties. Any notice, if mailed and properly
addressed with postage prepaid, shall be deemed given when received; any notice,
if transmitted by telex or facsimile, shall be deemed given when transmitted
(answerback confirmed in the case of telexes). Notice may be given as follows:

                                       83
<PAGE>

To the Borrower:

                           LNR Property Corporation
                           760 N.W. 107th Avenue
                           Miami, Florida  33172
                           Attention:  Shelly Rubin
                           Telecopy:  (305) 226-7691

                           With a copy to:

                           Bilzin Sumberg Dunn Price & Axelrod LLP
                           2500 First Union Financial Center
                           Miami, Florida  33131
                           Attention:  Brian L. Bilzin, Esq.
                           Telecopy:  (305) 374-7593

                  To each Lender:

                           As shown below the Lenders' signatures.

                  To the Agent:

                           Bank of America, N.A.
                           Real Estate Group
                           Structured Debt
                           231 South LaSalle Street, 12th Floor
                           IL1-231-12-18
                           Chicago, Illinois  60697
                           Attention:  Mark Lariviere
                           Telecopy:  (312) 974-4970

                           With a copy to:

                           Barack Ferrazzano Kirschbaum Perlman & Nagelberg
                           333 West Wacker Drive, Suite 2700
                           Chicago, Illinois 60606
                           Attention:  Howard J. Kirschbaum, Esq.
                           Telecopy:  (312) 984-3150

         15.2 Change of Address. Each party may change the address for service
of notice upon it by a notice in writing to the other parties hereto.

      [The remainder of this page and page 86 are intentionally left blank.
                          Signatures begin on page 87.]

                                       84
<PAGE>

            [The remainder of this page is intentionally left blank.]

                                       85
<PAGE>

IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first above written.

BORROWER:                           LNR PROPERTY CORPORATION and each of the
                                    corporate Subsidiaries listed on Schedule I,
                                    each on its own behalf and on behalf of each
                                    of the other Subsidiaries listed on Schedule
                                    I of which it is the manager or for which it
                                    is shown as a direct or indirect Owner on
                                    Schedule I

                                    By:
                                       -----------------------------------------
                                    Title:
                                          --------------------------------------

LENDERS:                            BANK OF AMERICA, N.A.

                                    By:
                                       -----------------------------------------
                                    Title:
                                          --------------------------------------
                                    Commitment: $100,000,000.00
                                    Percentage: 30.7692%

                                    Address for Notices:

                                    Real Estate Group
                                    Structured Debt
                                    231 South LaSalle Street, 12th Floor
                                    IL1-231-12-18
                                    Chicago, Illinois  60697
                                    Attention:  Mark Lariviere
                                    Telephone:  (312) 828-2513
                                    Telecopy:  (312) 974-4970

                                       86
<PAGE>

                                    U.S. BANK, NATIONAL ASSOCIATION

                                    By:
                                       -----------------------------------------
                                    Title:
                                          --------------------------------------
                                    Commitment: $40,000,000
                                    Percentage: 12.3077%

                                    Address for Notices:
                                    U.S. Bank Place
                                    MPFP-0509 601
                                    Second Avenue South
                                    Minneapolis, Minnesota  55402-4302
                                    Attention: Michael Raarup
                                    Telephone: (612) 973-2102
                                    Telecopy: (612) 973-0830

                                    FLEET NATIONAL BANK

                                    By:
                                       -----------------------------------------
                                    Title:
                                          --------------------------------------
                                    Commitment: $35,000,000
                                    Percentage: 10.7692%

                                    Address for Notices:
                                    115 Perimeter Center Place, N.E.
                                    Suite 500
                                    Atlanta, Georgia 30346 (5)
                                    Attention: Daniel Silbert
                                    Telephone: (770) 390-6552
                                    Telecopy: (770) 390-8434

                                       87
<PAGE>

                                    GUARANTY FEDERAL BANK, F.S.B.

                                    By:
                                       -----------------------------------------
                                    Title:
                                          --------------------------------------
                                    Commitment: $35,000,000
                                    Percentage: 10.7692%

                                    Address for Notices:
                                    8333 Douglas Avenue
                                    Dallas, Texas 75225
                                    Attention: Jenny Ray
                                    Telephone: (214) 360-2837
                                    Telecopy: (214) 360-1661

                                    UNION BANK OF CALIFORNIA

                                    By:
                                       -----------------------------------------
                                    Title:
                                          --------------------------------------
                                    Commitment: $25,000,000
                                    Percentage: 7.6923%

                                    Address for Notices:
                                    445 South Figueroa, 12th Floor
                                    Los Angeles, California 90071-1655
                                    Attention: Matthew Felsot
                                    Telephone: (213) 236-7410
                                    Telecopy: (213) 236-5166

                                       88
<PAGE>

                                    BANK ONE, NA

                                    By:
                                       -----------------------------------------
                                    Title:
                                          --------------------------------------
                                    Commitment: $20,000,000
                                    Percentage: 6.1538%

                                    Address for Notices:
                                    1 Bank One Plaza
                                    IL1-0315
                                    Chicago, Illinois 60670
                                    Attention: Mark Kramer
                                    Telephone: (312) 336-2212
                                    Telecopy: (312) 732-1117

                                    COMERICA BANK - CALIFORNIA, a California
                                    banking corporation

                                    By:
                                       -----------------------------------------
                                    Title:
                                          --------------------------------------
                                    Commitment: $20,000,000
                                    Percentage: 6.1538%

                                    Address for Notices:
                                    611 Anton Boulevard, 2nd Floor
                                    Costa Mesa, California 92626
                                    Attention: John Swanson
                                    Telephone: (714) 424-3834
                                    Telecopy: (714) 424-3840

                                       89
<PAGE>

                                    SANWA BANK CALIFORNIA

                                    By:
                                       -----------------------------------------
                                    Title:
                                          --------------------------------------
                                    Commitment: $20,000,000
                                    Percentage: 6.1538%

                                    Address for Notices:
                                    4041 MacArthur Boulevard, Suite 100
                                    Newport Beach, California 92660
                                    Attention: Jonathan Ward
                                    Telephone: (949) 622-6024
                                    Telecopy: (949) 852-8744

                                    MIDFIRST BANK, a Federally Chartered
                                    Savings Association

                                    By:
                                       -----------------------------------------
                                    Title:
                                          --------------------------------------
                                    Commitment: $15,000,000
                                    Percentage: 4.6154%

                                    Address for Notices:
                                    MidFirst Plaza
                                    501 W I-44
                                    Service Road
                                    Oklahoma City, Oklahoma 73118
                                    Attention: Roger DiSalvatore
                                    Telephone: (405) 767-7110
                                    Telecopy: (405) 767-7120

                                       90
<PAGE>

                                    BANKERS TRUST COMPANY

                                    By:
                                       -----------------------------------------
                                    Title:
                                          --------------------------------------
                                    Commitment: $10,000,000
                                    Percentage: 3.0769%

                                    Address for Notices:
                                    130 Liberty Street
                                    29th Floor MS 2291
                                    New York, New York 10006
                                    Attention: Meg Sutton
                                    Telephone: (212) 250-3505
                                    Telecopy: (212) 250-7218

                                    COMPASS BANK

                                    By:
                                       -----------------------------------------
                                    Title:
                                          --------------------------------------
                                    Commitment: $5,000,000
                                    Percentage: 1.5385%

                                    Address for Notices:
                                    10060 Skinner Lake Drive
                                    Jacksonville, Florida 32246
                                    Attention: C. French Yarbrough, Jr.
                                    Telephone: (904) 564-8989
                                    Telecopy: (904) 564-8906

                                       91
<PAGE>

AGENT:                              BANK OF AMERICA, N.A.

                                    By:
                                       -----------------------------------------
                                    Title:
                                          --------------------------------------

                                    Address for Notices:

                                    Bank of America, N.A.
                                    Real Estate Group
                                    Structured Debt
                                    231 South LaSalle Street, 12th Floor
                                    IL1-231-12-18
                                    Chicago, Illinois  60697
                                    Attention: Mark Lariviere
                                    Telephone: (312) 828-2513
                                    Telecopy: (312) 974-4970

                                       92
<PAGE>

                                    EXHIBIT A

                                   PERCENTAGES

Bank of America, N.A.                                              30.7692%

U.S. Bank, National Association                                    12.3077%

Fleet National Bank                                                10.7692%

Guaranty Federal Bank, F.S.B.                                      10.7692%

Union Bank of California                                            7.6923%

Bank One, N.A.                                                      6.1538%

Comerica Bank - California                                          6.1538%

Sanwa Bank California                                               6.1538%

MidFirst Bank                                                       4.6154%

Bankers Trust Company                                               3.0769%

Compass Bank                                                        1.5385%
                                                                  --------
                                                                  100.0000%

                                       A-1
<PAGE>

                                   EXHIBIT B-1

                             FORM OF REVOLVING NOTE

$____________                                                     July ___, 2000

         On or before the Maturity Date, as defined in that certain Second
Amended and Restated Revolving Credit Agreement dated as of June ___, 2000 (the
"Agreement") between LNR PROPERTY CORPORATION, a Delaware corporation and
certain of its Subsidiaries identified in the Agreement (collectively,
"Borrower"), BANK OF AMERICA, N.A., individually and as Agent for the Lenders
(as such terms are defined in the Agreement), and the other Lenders, Borrower
promises to pay to the order of (the "Lender"), or its successors and assigns,
the principal sum of          AND NO/100 DOLLARS ($          ) or the aggregate
unpaid principal amount of all Loans (other than Swingline Loans) made by the
Lender to Borrower pursuant to Section 2.1 of the Agreement, in immediately
available funds to the account, or at the office of, Agent specified in Section
2.12 of the Agreement, together with interest on the unpaid principal amount
hereof at the rates and on the dates set forth in the Agreement. The Borrower
shall pay this Promissory Note ("Note") in full on or before the Maturity Date
in accordance with the terms of the Agreement.

       The Lender shall, and is hereby authorized to, record on Schedule A
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Loan and the date and amount of each principal
payment hereunder.

       This Note is issued pursuant to, and is entitled to the security under
and benefits of, the Agreement and the other Loan Documents, to which Agreement
and Loan Documents, as they may be amended from time to time, reference is
hereby made for, inter alia, a statement of the terms and conditions under which
this Note may be prepaid or its maturity date accelerated. Capitalized terms
used herein and not otherwise defined herein are used with the meanings
attributed to them in the Agreement.

       If there is an Event of Default or Default under the Agreement or any
other Loan Document and Lender exercises its remedies provided under the
Agreement and/or any of the Loan Documents, then in addition to all amounts
recoverable by the Lender under such documents, Lender shall be entitled to
receive reasonable attorneys fees and expenses incurred by Lender in exercising
such remedies.

        Borrower and all endorsers severally waive presentment, protest and
demand, notice of protest, demand and of dishonor and nonpayment of this Note
(except as otherwise expressly provided for in the Agreement), and any and all
lack of diligence or delays in collection or enforcement of this Note, and
expressly agree that this Note, or any payment hereunder, may be extended from
time to time, and expressly consent to the release of any party liable for the
obligation secured by this Note, the release of any of the security of this
Note, the acceptance of

                                      B1-1
<PAGE>

any other security therefor, or any other indulgence or forbearance whatsoever,
all without notice to any party and without affecting the liability of the
Borrower and any endorsers hereof.

         This Note shall be governed and construed under the internal laws of
the State of Illinois.

        BORROWER AND LENDER, BY ITS ACCEPTANCE HEREOF, EACH HEREBY WAIVE ANY
RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY
RIGHT UNDER THIS PROMISSORY NOTE OR ANY OTHER LOAN DOCUMENT OR RELATING THERETO
OR ARISING FROM THE LENDING RELATIONSHIP WHICH IS THE SUBJECT OF THIS NOTE AND
AGREE THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT
BEFORE A JURY.

                                        LNR PROPERTY CORPORATION and each of the
                                        Subsidiaries listed on Schedule I

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

                                      B1-2
<PAGE>

                                   SCHEDULE A

                               LOANS AND PAYMENTS

                                                   Unpaid
                              Principal            Principal            Notation
Date          Loan            Payments             Balance              Made By

--------------------------------------------------------------------------------

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                                      B1-3
<PAGE>

                                   EXHIBIT B-2

                             FORM OF SWINGLINE NOTE

$20,000,000                                                        July __, 2000

         On or before the due date of each "Swingline Loan", as defined in that
certain Second Amended and Restated Revolving Credit Agreement dated as of June
____, 2000 (the "Agreement") between LNR PROPERTY CORPORATION, a Delaware
corporation, and certain of its Subsidiaries identified in the Agreement
(collectively, "Borrower"), BANK OF AMERICA, N.A., individually ("____________")
and as Agent for the Lenders (as such terms are defined in the Agreement), and
the other Lenders, Borrower promises to pay to the order of ____________ (the
"Lender"), or its successors and assigns, the unpaid principal amount of such
Swingline Loan made by the Lender to the Borrower pursuant to Section 2.16 of
the Agreement, in immediately available funds to the account, or at the office
of, Agent specified in Section 2.12 of the Agreement, together with interest on
the unpaid principal amount hereof at the rates and on the dates set forth in
the Agreement. The Borrower shall pay any remaining unpaid principal amount of
such Swingline Loans under this Swingline Note ("Note") in full on or before the
Maturity Date in accordance with the terms of the Agreement.

        The Lender shall, and is hereby authorized to, record on Schedule A
attached hereto, or to otherwise record in accordance with its usual practice,
the date, amount and due date of each Swingline Loan and the date and amount of
each purchase of a Swingline Loan by the Lenders or principal payment hereunder.

        This Note is issued pursuant to, and is entitled to the security under
and benefits of, the Agreement and the other Loan Documents, to which Agreement
and Loan Documents, as they may be amended from time to time, reference is
hereby made for, inter alia, a statement of the terms and conditions under which
this Note may be prepaid or its maturity date accelerated. Capitalized terms
used herein and not otherwise deemed herein are used with the meanings
attributed to them in the Agreement.

        If there is an Event of Default or Default under the Agreement or any
other Loan Document and Lender exercises its remedies provided under the
Agreement and/or any of the Loan Documents, then in addition to all amounts
recoverable by the Lender under such documents, Lender shall be entitled to
receive reasonable attorneys fees and expenses incurred by Lender in exercising
such remedies.

        Borrower and all endorsers severally waive presentment, protest and
demand, notice of protest, demand and of dishonor and nonpayment of this Note
(except as otherwise expressly provided for in the Agreement), and any and all
lack of diligence or delays in collection or enforcement of this Note, and
expressly agree that this Note, or any payment hereunder, may be extended from
time to time, and expressly consent to the release of any party liable for the

                                      B2-1
<PAGE>

obligation secured by this Note, the release of any of the security of this
Note, the acceptance of any other security therefor, or any other indulgence or
forbearance whatsoever, all without notice to any party and without affecting
the liability of the Borrower and any endorsers hereof.

         This Note shall be governed and construed under the internal laws of
the State of Illinois.

         BORROWER AND LENDER, BY ITS ACCEPTANCE HEREOF, EACH HEREBY WAIVE ANY
RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY
RIGHT UNDER THIS PROMISSORY NOTE OR ANY OTHER LOAN DOCUMENT OR RELATING THERETO
OR ARISING FROM THE LENDING RELATIONSHIP WHICH IS THE SUBJECT OF THIS NOTE AND
AGREE THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT
BEFORE A JURY.

                                       LNR PROPERTY CORPORATION and each of the
                                       Subsidiaries listed on Schedule I

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

                                      B2-2
<PAGE>

                                   SCHEDULE A

                              PAYMENTS OF PRINCIPAL

                              Purchase             Unpaid
                              Principal            Principal            Notation
Date          Loan            Payments             Balance              Made By

--------------------------------------------------------------------------------

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--------------------------------------------------------------------------------

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                                      B2-3
<PAGE>

                                    EXHIBIT C

                                PLEDGE AGREEMENT

         THIS PLEDGE AGREEMENT dated as of ____________ __, ____ is by and
between ____________________________, a __________ corporation (the "Pledgor")
whose address is ___________________________, and ____________, individually
("____________") and BANK OF AMERICA, N.A., as agent for the Lenders ("Agent"),
whose address is, and the other Lenders as defined in the Loan Agreement
described below (collectively, the "Secured Party").

                                    RECITALS:

         A. ____________ ("____________"), Pledgor and certain of their
Affiliates (collectively, "Borrower") and Secured Party have entered into that
certain Second Amended and Restated Revolving Credit Agreement dated as of July
14, 2000 (as the same may be amended or modified from time to time, the "Loan
Agreement"). Terms defined in the Loan Agreement and not otherwise defined
herein are used as defined in the Loan Agreement.

         B. Secured Party has conditioned its obligations under the Loan
Agreement upon the execution and delivery of this Agreement by Pledgor.

         NOW THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

                                    ARTICLE 1

                          Security Interest and Pledge

         Section 1.1 Security Interest and Pledge. As collateral security for
the prompt payment in full when due of the Obligations (whether at stated
maturity, by acceleration, or otherwise) and all present and future obligations
of Pledgor under this Agreement, Pledgor hereby pledges and grants to Secured
Party a first priority security interest in the following property (such
property being hereinafter sometimes called the "Collateral"):

                  a. all of Pledgor's shares of Capital Stock of each of the
entities identified on Schedule I hereto (each a "Pledge Subsidiary"), whether
now owned or hereafter acquired; and

                  b. all products, proceeds, revenues, distributions, dividends,
stock dividends, securities, and other property, rights, and interests that
Pledgor receives or is at any time entitled to receive on account of the same.

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                                    ARTICLE 2

                         Representations and Warranties

         Pledgor represents and warrants to Secured Party that:

         Section 2.1 Title. Pledgor owns, and with respect to Collateral
acquired after the date hereof, Pledgor will own, legally and beneficially, the
Collateral free and clear of any Lien, security interest, pledge, claim, or
other encumbrance or any right or option on the part of any third Person to
purchase or otherwise acquire the Collateral or any part thereof, except for the
security interest granted hereunder. The Collateral is not subject to any
restriction on transfer or assignment except for compliance with applicable
federal and state securities laws and regulations promulgated thereunder.
Pledgor has the unrestricted right to pledge the Collateral as contemplated
hereby. All of the Collateral has been duly and validly issued and is fully paid
and nonassessable.

         Section 2.2 Organization and Authority. Pledgor is a corporation duly
organized, validly existing, and in good standing under the laws of its state of
incorporation. Pledgor has the corporate power and authority to execute,
deliver, and perform this Agreement, and the execution, delivery, and
performance of this Agreement by Pledgor have been duly authorized by all
necessary corporate action on the part of Pledgor and do not and will not
violate or conflict with the articles of incorporation or bylaws of Pledgor or
any law, rule, or regulation or any order, writ, injunction, or decree of any
court, governmental authority, or arbitrator and do not and will not conflict
with, result in a breach of, or constitute a default under the provisions of any
indenture, mortgage, deed of trust, security agreement, or other instrument or
agreement binding on Pledgor or any of its property.

         Section 2.3 Principal Place of Business. The principal place of
business and chief executive office of Pledgor, and the office where Pledgor
keeps its books and records, is located at the address of Pledgor shown at the
beginning of this Agreement.

         Section 2.4 Litigation. There is no litigation, investigation. or
governmental proceeding pending or threatened against Pledgor or any of its
properties which if adversely determined would have a material adverse effect on
the Collateral or the financial condition, operations, or business of Pledgor.

         Section 2.5 Percentage of Stock. The Collateral consist of certificated
shares constituting One Hundred percent (100%) of the issued and outstanding
shares of Capital Stock of each Pledge Subsidiary, except as otherwise indicated
on Schedule I.

         Section 2.6 First Priority Perfected Security Interest. This Agreement,
when coupled with the delivery of the Collateral to Secured Party, creates in
favor of Secured Party a first priority perfected security interest in the
Collateral. There are no conditions precedent to the effectiveness of this
Agreement that have not been fully and permanently satisfied.

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<PAGE>

         Section 2.7 Pledge Subsidiaries. The Pledge Subsidiaries constitute all
of the wholly-owned direct and indirect Subsidiaries of LNR that are not
Borrowers or Guarantors under the Loan Agreement.

                                    ARTICLE 3

                       Affirmative and Negative Covenants

         Pledgor covenants and agrees with Secured Party that:

         Section 3.1 Delivery. Prior to or concurrently with the execution and
delivery of this Agreement, Pledgor shall deliver to Secured Party all
certificate(s) identified in Schedule I hereto, accompanied by undated stock
powers duly executed in blank.

         Section 3.2 Encumbrances. Pledgor shall not create, permit, or suffer
to exist, and shall defend the Collateral against, any Lien, security interest.
or other encumbrance on the Collateral except the pledge and security interest
of Secured Party hereunder, and shall defend Pledgor's rights in the Collateral
and Secured Party's security interest in the Collateral against the claims of
all Persons.

         Section 3.3 Sale of Collateral. Pledgor shall not sell, assign, or
otherwise dispose of the Collateral or any part thereof without the prior
written consent of Secured Party.

         Section 3.4 Distributions. If Pledgor shall become entitled to receive
or shall receive any stock certificate (including, without limitation, any
certificate representing a stock dividend or a distribution in connection with
any reclassification. increase, or reduction of capital or issued in connection
with any reorganization), option or rights, whether as an addition to, in
substitution of, or in exchange for any Collateral or otherwise, Pledgor agrees
to accept the same as Secured Party's agent and to hold the same in trust for
Secured Party, and to deliver the same forthwith to Secured Party in the exact
form received, with the appropriate endorsement of Pledgor when necessary and/or
appropriate undated stock powers duly executed in blank, to be held by Secured
Party as additional Collateral for the obligations, subject to the terms hereof.
Subject to the provisions of Section 4.3, any sums paid upon or in respect of
the Collateral upon the liquidation or dissolution of the issuer thereof shall
be paid over to Secured Party to be held by it as additional Collateral for the
Obligations subject to the terms hereof; and in case any distribution of capital
shall be made on or in respect of the Collateral or any property shall be
distributed upon or with respect to the Collateral pursuant to any
recapitalization or reclassification of the capital of the issuer thereof or
pursuant to any reorganization of the issuer thereof, the property so
distributed shall be delivered to the Secured Party to be held by it, as
additional Collateral for the Obligations. subject to the terms hereof. All sums
of money and property so paid or distributed in respect of the Collateral that
are received by Pledgor shall. until paid or delivered to Secured Party, be held
by Pledgor in trust as additional security for the Obligations.

         Section 3.5 Further Assurances. At any time and from time to time, upon
the request of Secured Party, and at the sole expense of Pledgor, Pledgor shall
promptly execute and deliver all

                                      C-3
<PAGE>

such further instruments and documents and take such further action as Secured
Party may deem necessary or desirable to preserve and perfect its security
interest in the Collateral and carry out the provisions and purposes of this
Agreement, including, without limitation, the execution and filing of such
financing statements as Secured Party may require. A carbon, photographic, or
other reproduction of this Agreement or of any financing statement covering the
Collateral or any part thereof shall be sufficient as a financing statement and
may be filed as a financing statement. Subject to the rights of Pledgor under
Section 4.3 hereof, in the event any Collateral is ever received by Pledgor,
Pledgor shall promptly transfer and deliver to Secured Party such Collateral so
received by Pledgor (together with any necessary endorsements in blank or
undated stock powers duly executed in blank), which Collateral shall thereafter
be held by Secured Party pursuant to the terms of this Agreement. Secured Party
shall at all times have the right to exchange any certificates representing
Collateral for certificates of smaller or larger denominations for any purpose
consistent with this Agreement.

         Section 3.6 Inspection Rights. Pledgor shall permit Secured Party and
its representatives to examine, inspect, and copy Pledgor's books and records at
any reasonable time and as often as Secured Party may desire.

         Section 3.7 Taxes. Pledgor agrees to pay or discharge prior to
delinquency all taxes. assessments, levies, and other governmental charges
imposed on it or its property, except Pledgor shall not be required to pay or
discharge any tax, assessment, levy, or other governmental charge if (i) the
amount or validity thereof is being contested by Pledgor in good faith by
appropriate proceedings diligently pursued, (ii) such proceedings do not involve
any risk of sale, forfeiture, or loss of the Collateral or any interest therein,
and (iii) adequate reserves therefor have been established in conformity with
GAAP.

         Section 3.8 Notification. Pledgor shall promptly notify Secured Party
if any officer of Pledgor shall obtain knowledge of (i) any Lien, security
interest, encumbrance, or claim made or threatened against the Collateral, (ii)
any material change in the Collateral, including, without limitation, any
material decrease in the value of the Collateral and (iii) the occurrence or
existence of any Event of Default or the occurrence or existence of any
condition or event that, with the giving of notice or lapse of time or both,
would be an Event of Default (unless the same has been reported by Borrower).

         Section 3.9 Books and Records: Information. Pledgor shall keep accurate
and complete books and records of the Collateral and Pledgor's business and
financial condition in accordance with GAAP. Pledgor shall from time to time at
the request of Secured Party deliver to Secured Party such information regarding
the Collateral and Pledgor as Secured Party may request. Pledgor shall mark its
books and records to reflect the security interest of Secured Party under this
Agreement.

         Section 3.10 Compliance with Agreements. Pledgor shall comply in all
material respects with all agreements, contracts, and instruments binding on it
or affecting its properties or business.

                                      C-4
<PAGE>

         Section 3.11 Compliance with Laws. Pledgor shall comply in all material
respects with all applicable laws, rules, regulations, and orders of any court
or governmental authority.

         Section 3.12 Additional Securities. Pledgor shall not consent to or
approve the issuance of any additional shares of any class of capital stock of
the issuer of the Collateral, or any securities convertible into, or
exchangeable for, any such shares or any warrants, options, rights, or other
commitments entitling any Person to purchase or otherwise acquire any such
shares, unless the same becomes part of the Collateral.

                                    ARTICLE 4

                       Rights of Secured Party and Pledgor

         Section 4.1 Power of Attorney. Pledgor hereby irrevocably constitutes
and appoints Secured Party and any officer or agent thereof, with full power of
substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead and in the name of Pledgor or in its
own name, from time to time in Secured Party's discretion, to take any and all
action and to execute any and all documents and instruments which may be
necessary or desirable to accomplish the purposes of this Agreement and, without
Limiting the generality of the foregoing, hereby gives Secured Party the power
and right on behalf of Pledgor and in its own name to do any of the following
(subject to the rights of Pledgor under Sections 4.2 and 4.3 hereof), without
notice to or the consent of Pledgor, following the occurrence and during the
continuance of a Default or an Event of Default under the Loan Agreement:

                  a. to demand, sue for, collect, or receive in the name of
Pledgor or in its own name, any money or property at any time payable or
receivable on account of or in exchange for any of the Collateral and, in
connection therewith, endorse checks, notes, drafts, acceptances, money orders,
or any other instruments for the payment of money under the Collateral;

                  b. to pay or discharge taxes, Liens, security interests, or
other encumbrances levied or placed on or threatened against the Collateral;

                  c. (i) to direct account debtors and any other parties liable
for any payment under any of the Collateral to make payment of any and all
monies due and to become due thereunder directly to Secured Party or as Secured
Party shall direct; (ii) to receive payment of and receipt for any and all
monies, claims. and other amounts due and to become due at any time in respect
of or arising out of any Collateral; (iii) to sign and endorse any drafts,
assignments, proxies, stock cowers. verifications, notices, and other documents
relating to the Collateral; (iv) to commence and prosecute any suit, actions or
proceedings at law or in equity in any court of competent jurisdiction to
collect the Collateral or any part thereof and to enforce any other right in
respect of any Collateral; (v) to defend any suit, action, or proceeding brought
against Pledgor with respect to any Collateral; (vi) to settle, compromise, or
adjust any suit, action or proceeding described above and, in connection
therewith, to give such discharges or releases as Secured Party may deem
appropriate; (vii) to exchange any of the Collateral for other property upon any
merger, consolidation, reorganization, recapitalization, or other readjustment
of the issuer thereof

                                      C-5
<PAGE>

and, in connection therewith, deposit any of the Collateral with any committee,
depository, transfer agent, registrar, or other designated agency upon such
terms as Secured Party may determine; (viii) to add or release any guarantor,
endorser, surety, or other party to any of the Collateral or the obligations;
(ix) to renew, extend, or otherwise change the terms and conditions of any of
the Collateral or Obligations; (x) to insure any of the Collateral; and (xi) to
sell, transfer, pledge, make any agreement with respect to or otherwise deal
with any of the Collateral as fully and completely as though Secured Party were
the absolute owner thereof for all purposes, and to do, at Secured Party's
option and Pledgor's expense, at any time, or from time to time, all acts and
things which Secured Party deems necessary to protect, preserve, or realize upon
the Collateral and Secured Party's security interest therein.

         This power of attorney is a power coupled with an interest and shall be
irrevocable. Secured Party shall be under no duty to exercise or withhold the
exercise of any of the rights, powers, privileges, and options expressly or
implicitly granted to Secured Party in this Agreement, and shall not be liable
for any failure to do so or any delay in doing so. Secured Party shall not be
liable for any act or omission or for any error of judgment or any mistake of
fact or law in its individual capacity or in its capacity as attorney-in-fact
except acts or omissions resulting from its willful misconduct. This power of
attorney is conferred on Secured Party solely to protect, preserve, and realize
upon its security interest in the Collateral.

         Section 4.2 Voting Rights. Unless an Event of Default shall have
occurred and be continuing, all Collateral shall remain registered in the name
of Pledgor and Pledgor shall be entitled to exercise any and all voting rights
pertaining to the Collateral or any part thereof for any purpose not
inconsistent with the terms of this Agreement or the Loan Agreement. Secured
Party shall, at Pledgor's expense, execute and deliver to the Pledgor all such
proxies and other instruments as Pledgor may reasonably request and provide for
the purpose of enabling Pledgor to exercise the voting rights which it is
entitled to exercise pursuant to this Section.

         Section 4.3 Dividends and Other Distributions. Unless a Default or an
Event of Default shall have occurred and be continuing, Pledgor shall be
entitled to receive and retain any dividends and other distributions on the
Collateral paid to the extent and only to the extent that such dividends and
other distributions are permitted by the Loan Agreement.

         Section 4.4 Performance by Secured Party. If Pledgor fails to perform
or comply with any of its agreements contained herein, Secured Party itself may,
at its sole discretion, cause or attempt to cause performance or compliance with
such agreement and the expenses of Secured Party, together with interest thereon
at the maximum nonusurious per annum rate permitted by applicable law, shall be
payable by Pledgor to Secured Party on demand and shall constitute Obligations
secured by this Agreement. Notwithstanding the foregoing, it is expressly agreed
that Secured Party shall not have any liability or responsibility for the
performance of any obligation of Pledgor under this Agreement.

         Section 4.5 Setoff; Property Held by Secured Party. Secured Party shall
have the right to set off and apply against any Obligations that are then past
due, at any time but with notice to Pledgor, any and all deposits (general or
special, time or demand, provisional or final) or other

                                      C-6
<PAGE>

sums at any time credited by or owing from Secured Party to Pledgor. As
additional security for the Obligations, Pledgor hereby grants Secured Party a
security interest in all money, instruments, and other property of Pledgor now
or hereafter held by Secured Party, including, without limitation, property held
in safekeeping. In addition to Secured Party's right of setoff and as further
security for the Obligations, Pledgor hereby grants Secured Party a security
interest in all deposits (general or special, time or demand, provisional or
final) and other accounts of Pledgor now or hereafter maintained with Secured
Party and all other sums at any time credited by or owing from Secured Party to
Pledgor. The rights and remedies of Secured Party hereunder are in addition to
other rights and remedies (including, without limitation, other rights of
setoff) which Secured Party may have.

         Section 4.6 Secured Party's Duty of Care. Other than the exercise of
reasonable care in the physical custody of the Collateral while held by Secured
Party hereunder, Secured Party shall have no responsibility for or obligation or
duty with respect to all or any part of the Collateral or any matter or
proceeding arising out of or relating thereto, including, without limitation,
any obligation or duty to collect any sums due in respect thereof or to protect
or preserve any rights against prior parties or any other rights pertaining
thereto, it being understood and agreed that Pledgor shall be responsible for
preservation of all rights in the Collateral. Without limiting the generality of
the foregoing, Secured Party shall be conclusively deemed to have exercised
reasonable care in the custody of the Collateral if Secured Party takes such
action, for purposes of preserving rights in the Collateral, as Pledgor may
reasonably request in writing, but no failure or omission or delay by Secured
Party in complying with any such request by Pledgor. and no refusal by Secured
Party to comply with any such request by Pledgor, shall be deemed to be a
failure to exercise reasonable care.

         Section 4.7 Assignment by Secured Party. Secured Party may at any time
and from time to time assign the Obligations and any portion thereof and/or the
Collateral and any portion thereof. and the assignee shall be entitled to all of
the rights and remedies and be subject to all of the Obligations of Secured
Party under this Agreement in relation thereto.

                                    ARTICLE 5

                                     Default

         Section 5.1 Rights and Remedies. If any Event of Default shall occur
and be continuing, then unless and until such Event of Default has been waived
in writing by Secured Party or otherwise cured to Secured Party's satisfaction,
Secured Party shall have the following rights and remedies:

                  a. In addition to all other rights and remedies granted to
Secured Party in this Agreement and in any other instrument or agreement
securing, evidencing, or relating to the Obligations, Secured Party shall have
all of the rights and remedies of a secured party under the Uniform Commercial
Code. Without limiting the generality of the foregoing, Secured Party may (i)
without demand or notice to Pledgor, collect, receive, or take possession of the
Collateral or any part thereof, (ii) sell or otherwise dispose of the
Collateral, or any part thereof, in one or

                                      C-7
<PAGE>

more parcels at public or private sale or sales, at Secured Party's offices or
elsewhere, for cash, on credit, or for future delivery and/or (iii) bid and
become a purchaser at any sale free of any right or equity of redemption in
Pledgor, which right or equity is hereby expressly waived and released by
Pledgor. Upon the request of Secured Party, Pledgor shall assemble the
Collateral and make it available to Secured Party at any place designated by
Secured Party that is reasonably convenient to Pledgor and Secured Party.
Pledgor agrees that Secured Party shall not be obligated to give more than five
(5) days written notice of the time and place of any public sale or of the time
after which any private sale may take place and that such notice shall
constitute reasonable notice of such matters. Secured Party shall not be
obligated to make any sale of the Collateral regardless of notice of sale having
been given. Secured Party may adjourn any public or private sale from time to
time by announcement at the time and place fixed therefor, and such sale may,
without further notice, be made at the time and place to which it was so
adjourned. Pledgor shall be liable for all expenses of retaking, holding,
preparing for sale, or the like, and all attorneys' fees and other expenses
incurred by Secured Party in connection with the collection of the Obligations
and the enforcement of Secured Party's rights under this Agreement, all of which
expenses and fees shall constitute additional Obligations secured by this
Agreement. Secured Party may apply the Collateral against the Obligations in
such order and manner as Secured Party may elect in its sole discretion. Pledgor
shall remain liable for any deficiency if the proceeds of any sale or
disposition of the Collateral are insufficient to pay the Obligations. Pledgor
waives all rights of marshaling in respect of the Collateral.

                  b. Secured Party may cause any or all of the Collateral held
by it to be transferred into the name of Secured Party or the name or names of
Secured Party's nominee or nominees.

                  c. Secured Party may collect or receive all money or property
at any time payable or receivable on account of or in exchange for any of the
Collateral, but shall be under no obligation to do so.

                  d. Secured Party shall have the right, but shall not be
obligated to, exercise or cause to be exercised all voting, consensual, and
other powers of ownership pertaining to the Collateral, and Pledgor shall
deliver to Secured Party, if requested by Secured Party, irrevocable proxies
with respect to the Collateral in form satisfactory to Secured Party.

                  e. Pledgor hereby acknowledges and confirms that Secured Party
may be unable to effect a public sale of any or all of the Collateral by reason
of certain prohibitions contained in the Securities Act of 1933, as amended, and
applicable state securities laws and may be compelled to resort to one or more
private sales thereof to a restricted group of prospective purchasers.

                  f. On any sale of the Collateral, Secured Party is hereby
authorized to comply with any limitation or restriction with which compliance is
necessary, in the view of Secured Party's counsel, in order to avoid any
violation of applicable law or in order to obtain any required approval of the
purchaser or purchasers by any applicable governmental authority.

                                      C-8
<PAGE>

                                    ARTICLE 6

                                  Miscellaneous

         Section 6.1 Expenses: Indemnification. Pledgor agrees to pay on demand
all costs and expenses incurred by Secured Party in connection with the
preparation, negotiation, and execution of this Agreement and any and all
amendments, modifications, and supplements hereto. Pledgor agrees to pay and to
hold Secured Party harmless from and against all fees and all excise, sales,
stamp, and other taxes payable in connection with this Agreement or the
transactions contemplated hereby. Pledgor hereby indemnifies Secured Party and
each affiliate thereof and their respective officers, directors, employees,
attorneys, and agents from and holds each of them harmless against, any and all
losses, liabilities, claims, damages, penalties, judgments, costs, and expenses
(including attorneys' fees) to which any of them may become subject which
directly or indirectly arise from or relate to (i) the negotiation, execution,
delivery, performance, administration, or enforcement of this Agreement, (ii)
any of the transactions contemplated by this Agreement, (iii) any breach by
Pledgor of any representation, warranty, covenant, or other agreement contained
in this Agreement or (iv) any investigation, litigation, or other proceeding,
including, without limitation, any threatened investigation, litigation, or
other proceeding relating to any of the foregoing. Without limiting any
provision of this Agreement or any other instrument or agreement securing,
evidencing, or relating to the Obligations or any part thereof, it is the
express intention of the parties hereto that each person or entity to be
indemnified under this Section shall be indemnified from and held harmless
against any and all losses, liabilities, claims, damages, penalties, judgments,
costs, and expenses (including attorneys' fees) arising out of or resulting from
the sole or contributory negligence of the person or entity to be indemnified.

         Section 6.2 No Waiver: Cumulative Remedies. No failure on the part of
Secured Party to exercise and no delay in exercising, and no course of dealing
with respect to, any right, power, or privilege under this Agreement shall
operate as a waiver thereof, nor shall any single or partial exercise of any
right, power, or privilege under this Agreement preclude any other or further
exercise thereof or the exercise of any other right, power, or privilege. The
rights and remedies provided for in this Agreement are cumulative and not
exclusive of any rights and remedies provided by law.

         Section 6.3 Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of Pledgor and Secured Party and their respective
heirs, successors, and assigns, except that Pledgor may not assign any of its
rights or obligations under this Agreement without the prior written consent of
Secured Party.

         Section 6.4 AMENDMENT; ENTIRE AGREEMENT. THIS AGREEMENT EMBODIES THE
FINAL, ENTIRE AGREEMENT AMONG THE PARTIES HERETO AND SUPERSEDES ANY AND ALL
PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS, AND UNDERSTANDINGS, WHETHER
WRITTEN OR ORAL, RELATING TO THE SUBJECT MATTER HEREOF AND MAY NOT BE
CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL

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<PAGE>

AGREEMENTS OR DISCUSSIONS OF THE PARTIES HERETO. THERE ARE NO ORAL AGREEMENTS
AMONG THE PARTIES HERETO. The provisions of this Agreement may be amended or
waived only by an instrument in writing signed by the parties hereto.

         Section 6.5 Notices. All notices and other communications provided for
in this Agreement shall be given or made by telex, telegraph, telecopy, cable or
in writing and telexed, telecopied, telegraphed, cabled, mailed by certified
mail return receipt requested, or otherwise delivered to the intended recipient
at the "Address for Notices" specified below its name on the signature pages
hereof; or, as to any party at such other address as shall be designated by such
party in a notice to the other party given in accordance with this Section.
Except as otherwise provided in this Agreement, all such communications shall be
deemed to have been duly given when transmitted by telex or telecopy, subject to
telephone confirmation of receipt, or delivered to the telegraph or cable
office, subject to telephone confirmation of receipt, or when personally
delivered or, in the case of a mailed notice, when duly deposited in the mails
and receipted for, in each case given or addressed as aforesaid.

         Section 6.6 Applicable Law: Venue: Service of Process. This Agreement
shall be governed by and construed in accordance with the internal laws of the
State of Illinois, without regard to its conflict of laws rules or choice of law
principles, and the applicable laws of the United States of America. Any action
or proceeding against Pledgor under or in connection with this Agreement or any
other instrument or agreement securing, evidencing, or relating to the
Obligations or any part thereof may be brought in any state or federal court in
Cook County, Illinois. Pledgor hereby irrevocably (i) submits to the
nonexclusive jurisdiction of such courts and (ii) waives any objection it may
now or hereafter have as to the venue of any such action or proceeding brought
in such court or that such court is an inconvenient forum. Pledgor agrees that
service of process upon it may be made by certified or registered mail, return
receipt requested, at its address specified or determined in accordance with the
provisions of Section 6.5 of this Agreement. Nothing in this Agreement or any
other instrument or agreement securing, evidencing, or relating to the
Obligations or any part thereof shall affect the right of Secured Party to serve
process in any other manner permitted by law or shall limit the right of Secured
Party to bring any action or proceeding against Pledgor or with respect to any
of its property in courts in other jurisdictions. Any action or proceeding by
Pledgor against Secured Party shall be brought only in a court located in Cook
County, Illinois.

         Section 6.7 Headings. The headings, captions, and arrangements used in
this Agreement are for convenience only and shall not affect the interpretation
of this Agreement.

         Section 6.8 Survival. All representations and warranties made in this
Agreement shall survive the execution and delivery of this Agreement, and no
investigation by Secured Party shall affect the representations and warranties
of Pledgor herein or the right of Secured Party to rely upon them.

         Section 6.9 Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

                                      C-10
<PAGE>

         Section 6.10 Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions of this Agreement, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

         Section 6.11 Construction. Pledgor and Secured Party acknowledge that
each of them has had the benefit of legal counsel of its own choice and has been
afforded an opportunity to review this Agreement with its legal counsel and that
this Agreement shall be construed as if jointly drafted by Pledgor and Secured
Party.

         Section 6.12 Obligations Absolute. The obligations of Pledgor under
this Agreement shall be absolute and unconditional and shall not be released,
discharged, reduced, or in any way impaired by any circumstance whatsoever.
including, without limitation. any amendment. modification, extension or renewal
of this Agreement, the Obligations, or any document or instrument evidencing,
securing, or otherwise relating to the Obligations, or any release,
subordination, or impairment of collateral, or any waiver, consent, extension,
indulgence, compromise, settlement, or other action or inaction in respect of
this Agreement, the Obligations, or any document or instrument evidencing,
securing, or otherwise relating to the Obligations, or any exercise or failure
to exercise any right, remedy, power, or privilege in respect of the
Obligations.

         Section 6.13 WAIVER OF JURY TRIAL. TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, PLEDGOR HEREBY IRREVOCABLY AND EXPRESSLY WAIVES ALL RIGHT TO A
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED UPON
CONTRACT, TORT, OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
THE TRANSACTIONS CONTEMPLATED HEREBY OR THE ACTIONS OF SECURED PARTY IN THE
NEGOTIATION, ADMINISTRATION, OR ENFORCEMENT THEREOF.

                                      C-11
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first written above.

                              PLEDGOR:

                              --------------------------------------------------

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

                              Address for Notices:

                              with a copy to:

                              SECURED PARTY:

                              BANK OF AMERICA, N.A., as Agent for itself and
                              the other Lenders

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

                                      C-12
<PAGE>

                              Address for Notices:

                              Bank of America, N.A.
                              Real Estate Group
                              Structured Debt
                              231 South LaSalle Street, 12th Floor
                              IL1-231-12-18
                              Chicago, Illinois  60697
                              Attention:  Mark Lariviere
                              Telecopy:  (312) 974-4970

                              With a copy to:

                              Barack Ferrazzano Kirschbaum Perlman & Nagelberg
                              333 West Wacker Drive, Suite 2700
                              Chicago, Illinois 60606
                              Attention:  Howard J. Kirschbaum, Esq.
                              Telecopy:  (312) 984-3150

                                      C-13
<PAGE>

                                   SCHEDULE I

                                                                   Owner(s) and
                  Capital Stock             Certificate              Ownership
Entity         Outstanding  /  /00           Number(s)             Percentage(s)

                                      C-14
<PAGE>

                                    EXHIBIT D

                                FORM OF GUARANTY

         This Guaranty made as of ____________, ____, by ______________________,
a ____________ ("Guarantor"), to and for the benefit of BANK OF AMERICA, N.A.,
individually as a lender ("Bank of America") and as agent ("Agent") for itself
and the other Lenders, as defined in the Credit Agreement (as defined below),
and their respective successors and assigns.

                                    RECITALS

         A. ____________, a Delaware corporation ("____________"), and certain
of its Subsidiaries (collectively, "Borrower") have requested that the Lenders
make an unsecured revolving credit facility available to Borrower in the
aggregate principal amount of up to $350,000,000 ("Facility"), and that Agent
act as administrative agent, documentation agent and syndication agent with
respect thereto.

         B. The Lenders have agreed to make available the Facility to Borrower,
and Agent has agreed to act in said agency capacities, pursuant to the terms and
conditions set forth in that certain Second Amended and Restated Revolving
Credit Agreement dated as of June ____, 2000, between Borrower, Agent and the
Lenders (as amended, "Credit Agreement"), and Guarantor desires that the Lenders
continue to make Advances under the Credit Agreement and that Agent continue to
act in said agency capacities. All capitalized terms used and not otherwise
defined herein shall have the respective meanings ascribed to such terms in the
Credit Agreement.

         C. Borrower has executed and delivered to the Lenders one or more
promissory notes each dated July 14, 2000 in the aggregate principal amount of
up to $350,000,000 as evidence of its indebtedness to the Lenders with respect
to the Facility (the promissory notes described above, together with any
amendments or allonges thereto, or restatements, replacements or renewals
thereof, and/or new promissory notes to new Lenders under the Credit Agreement,
are collectively referred to herein as the "Revolving Note"). Borrower has also
executed and delivered to Bank of America a promissory note dated July 14, 2000
("Swingline Note") which evidences any Swingline Loans that may be made by Bank
of America, as Swingline Lender, under the Credit Agreement.

         D. Guarantor is a newly formed, wholly-owned single purpose Subsidiary
of LNR engaged solely in the mortgage banking business, and Guarantor is
deriving and will continue to derive substantial financial benefit from the
Facility evidenced by the Revolving Note, the Swingline Note, the Credit
Agreement and the other Loan Documents.

         E. The execution and delivery of this Guaranty by Guarantor is required
pursuant to the express terms of the Credit Agreement as a condition to any
further Advances under the Facility.

                                      D-1
<PAGE>

                                   AGREEMENTS

         NOW, THEREFORE, in consideration of the matters described in the
foregoing Recitals, which Recitals are incorporated herein and made a part
hereof, and for other good and valuable consideration, Guarantor hereby agrees
as follows:

         1. Guarantor absolutely, unconditionally, and irrevocably guarantees to
Agent and the Lenders:

                  (a) the full and prompt payment of the principal of and
         interest on the Revolving Note and/or the Swingline Note when due,
         whether at stated maturity, upon acceleration or otherwise, and at all
         times thereafter, and the prompt payment of all other sums which may
         now be or may hereafter become due and owing under the Revolving Note,
         the Swingline Note, the Credit Agreement and/or the other Loan
         Documents;

                  (b) the payment of all Enforcement Costs (as hereinafter
         defined); and

                  (c) the full, complete, and punctual observance, performance,
         and satisfaction of all of the obligations, duties, covenants, and
         agreements of Borrower under the Credit Agreement and the Loan
         Documents.

All amounts due, debts, liabilities, and payment obligations described in
subparagraphs (a) and (b) of this Paragraph 1 are referred to herein as the
"Facility Indebtedness." All obligations described in subparagraph (c) of this
Paragraph 1 are referred to herein as the "Obligations."

         2. In the event of any default by Borrower in making payment of the
Facility Indebtedness, or in performance of the Obligations, Guarantor agrees,
on demand by Agent, to pay all the Facility Indebtedness and to perform all the
Obligations as are or then or thereafter become due and owing or are to be
performed under the terms of the Revolving Note, the Swingline Note, the Credit
Agreement and/or the other Loan Documents, and to pay any reasonable expenses
incurred by Agent or the Lenders in protecting, preserving or defending its
interest in the Real Estate or any collateral for the Facility, or otherwise in
connection with the Facility or under any of the Loan Documents, including,
without limitation, all reasonable attorneys' fees and costs. Agent shall have
the right, at its option, either before, during or after pursuing any other
right or remedy against any Borrower or Guarantor, to perform any and all of the
Obligations by or through any agent, contractor or subcontractor, or any of
their agents, of its selection, all as Agent in its sole discretion deems
proper, or as the Required Lenders in their sole discretion may instruct Agent,
and Guarantor shall indemnify and hold Agent and the Lenders free and harmless
from and against any and all loss, damage, cost, expense, injury, or liability
Agent or the Lenders may suffer or incur in connection with the exercise of its
rights under this Guaranty or the performance of the Obligations, except to the
extent the same arises as a result of the gross negligence or willful misconduct
of Agent.

         All of the remedies set forth herein and/or provided by any of the Loan
Documents or law or equity shall be equally available to Agent for the benefit
of itself and the Lenders, and the

                                      D-2
<PAGE>

choice by Agent of one such alternative over another shall not be subject to
question or challenge by Guarantor or any other person, nor shall any such
choice be asserted as a defense, set-off or failure to mitigate damages in any
action, proceeding or counteraction by Agent for the benefit of itself and/or
the Lenders to recover or seeking any other remedy under this Guaranty, nor
shall such choice preclude Agent from subsequently electing to exercise a
different remedy. The parties have agreed to the alternative remedies
hereinabove specified in part because they recognize that the choice of remedies
in the event of a failure hereunder will necessarily and should properly be a
matter of business judgment, which, with hindsight after the passage of time and
events, may or may not prove to have been the best choice to maximize recovery
by Agent for the benefit of itself and the Lenders at the lowest cost to
Borrower and/or Guarantor. It is the intention of the parties that such choice
by Agent be given conclusive effect regardless of such subsequent developments.

         3. Guarantor does hereby waive (i) notice of acceptance of this
Guaranty by Agent or the Lenders and any and all notices and demands of every
kind which may be required to be given by any statute, rule or law, (ii) any
defense, right of set-off or other claim which Guarantor may have against the
Borrower or which Guarantor or Borrower may have against Agent or any of the
Lenders or the holder of the Revolving Note or the holder of the Swingline Note,
(iii) presentment for payment, demand for payment, notice of nonpayment,
dishonor, protest and notice of protest, diligence in collection and any and all
formalities which otherwise might be legally required to charge Guarantor with
liability, (iv) any failure by Agent or any of the Lenders to inform Guarantor
of any facts Agent or any of the Lenders may now or hereafter know about
Borrower, the Facility, or the transactions contemplated by the Credit
Agreement, it being understood and agreed that Agent and the Lenders have no
duty so to inform and that Guarantor is fully responsible for being and
remaining informed by Borrower of all circumstances bearing on the existence or
creation or risk of nonpayment of the Facility Indebtedness or the risk of
nonperformance of the Obligations, and (v) any and all right to cause a
marshaling of assets of the Borrower or any other action by any court or
governmental body with respect thereto, or to cause Agent or any of the Lenders
to proceed against any other security given to Agent or any of the Lenders in
connection with the Facility Indebtedness or the Obligations. Credit may be
granted or continued from time to time Borrower without notice to or
authorization from Guarantor, regardless of the financial or other condition of
Borrower at the time of any such grant or continuation. Guarantor acknowledges
that no representations of any kind whatsoever have been made by Agent or any of
the Lenders to Guarantor. No modification or waiver of any of the provisions of
this Guaranty shall be binding upon Agent or the Lenders except as expressly set
forth in a writing duly signed and delivered on behalf of Agent and the Lenders.

         4. Guarantor further agrees that Guarantor's liability as guarantor
shall in nowise be impaired by any renewals or extensions which may be made from
time to time, with or without the knowledge or consent of Guarantor of the time
for payment of interest or principal under the Revolving Note or the Swingline
Note or by any forbearance or delay in collecting interest or principal under
the Revolving Note or the Swingline Note, or by any waiver under the Credit
Agreement or any other Loan Documents, or by failure or election not to pursue
any other remedies against Borrower, or by any change or modification in the
Revolving Note, the Credit Agreement, the Swingline Note or any other Loan
Documents, or by the acceptance of any

                                      D-3
<PAGE>

additional security or any increase, substitution or change therein, or by the
release of any security or any withdrawal thereof or decrease therein, or by the
application of payments received from any source to the payment of any
obligation other than the Facility Indebtedness, even though Agent or the
Lenders might lawfully have elected to apply such payments to any part or all of
the Facility Indebtedness, it being the intent hereof that Guarantor shall
remain liable as principal for payment of the Facility Indebtedness and
performance of the Obligations until all indebtedness has been paid in full and
the other terms, covenants and conditions of the Credit Agreement and other Loan
Documents and this Guaranty have been performed, all obligations of the Lenders
have terminated, all obligations of the Swingline Lender have expired and all
Facility Letters Of Credit have expired, notwithstanding any act or thing which
might otherwise operate as a legal or equitable discharge of a surety. Guarantor
further understands and agrees that Agent and the Lenders may at any time enter
into agreements with Borrower to amend and modify the Revolving Note, Credit
Agreement, the Swingline Note or other Loan Documents, and may waive or release
any provision or provisions thereof, and, with reference to such instruments,
may make and enter into any such agreement or agreements as Agent, the Lenders
and Borrower may deem proper and desirable, without in any manner impairing this
Guaranty or any of Agent's or the Lenders' rights hereunder or any of the
Guarantor's obligations hereunder.

         5. This is an absolute, unconditional, complete, present and continuing
guaranty of payment and performance, and not of collection only. Guarantor
agrees that this Guaranty may be enforced by Agent and the Lenders without the
necessity at any time of resorting to or exhausting any other security or
collateral given in connection herewith or with the Facility or any of the Loan
Documents, or resorting to any other guaranties, and Guarantor hereby waives the
right to require Agent or the Lenders to join Borrower in any action brought
hereunder or to commence any action against or obtain any judgment against
Borrower or to pursue any other remedy or enforce any other right. Guarantor
further agrees that nothing contained herein or otherwise shall prevent Agent
and the Lenders from pursuing concurrently or successively all rights and
remedies available to it at law and/or in equity or under any of the Loan
Documents, and the exercise of any of its rights or the completion of any of its
remedies shall not constitute a discharge of any of Guarantor's obligations
hereunder, it being the purpose and intent of Guarantor that the obligations of
Guarantor hereunder shall be primary, absolute, independent and unconditional
under any and all circumstances whatsoever. Neither Guarantor's obligations
under this Guaranty nor any remedy for the enforcement thereof shall be
impaired, modified, changed or released in any manner whatsoever by any
impairment, modification, change, release or limitation of the liability of
Borrower under the Revolving Note, the Credit Agreement, the Swingline Note or
any other Loan Documents or by reason of Borrower's bankruptcy or by reason of
any creditor or bankruptcy proceeding instituted by or against Borrower. This
Guaranty shall continue to be effective and be deemed to have continued in
existence or be reinstated (as the case may be) if at any time payment of all or
any part of any sum payable pursuant to the Revolving Note, the Credit
Agreement, the Swingline Note or any other Loan Document is rescinded or
otherwise required to be returned by the payee upon the insolvency, bankruptcy,
or reorganization of the payer, all as though such payment had not been made,
regardless of whether Agent or any of the Lenders contested the order requiring
the return of such payment. The obligations of Guarantor pursuant to the
preceding sentence shall survive any termination, cancellation or release of
this Guaranty.

                                      D-4
<PAGE>

         6. This Guaranty shall be assignable by Agent and/or any of the Lenders
to any assignee of all or a portion of Agents and/or such Lender's rights under
the Loan Documents.

         7. If: (i) this Guaranty, the Revolving Note, the Swingline Note, the
Credit Agreement or any other Loan Document is placed in the hands of an
attorney for collection or is collected through any legal proceeding; (ii) an
attorney is retained to represent Agent and/or any of the Lenders in any
bankruptcy, reorganization, receivership, or other proceedings affecting
creditors' rights and involving a claim under this Guaranty, the Revolving Note,
the Swingline Note, the Credit Agreement or any Loan Document; (iii) an attorney
is retained to provide advice or other representation with respect to the Loan
Documents in connection with an enforcement action or potential enforcement
action; or (iv) an attorney is retained to represent Agent and/or any of the
Lenders in any other legal proceedings whatsoever in connection with this
Guaranty, the Revolving Note, any the Swingline Note, the Credit Agreement, any
of the other Loan Documents or any property subject thereto, then Guarantor
shall pay to Agent upon demand all reasonable attorney's fees, costs and
expenses, including, without limitation, court costs, filing fees, recording
costs and all other costs and expenses whatsoever incurred in connection
therewith (all of which are referred to herein as "Enforcement Costs"), in
addition to all other amounts due hereunder.

         8. The parties hereto intend that each provision in this Guaranty
comports with all applicable local, state and federal laws and judicial
decisions. However, if any provision or provisions, or if any portion of any
provision or provisions, in this Guaranty is found by a court of competent
jurisdiction to be in violation of any applicable local, state or federal
ordinance, statute, law, administrative or judicial decision, or public policy,
and if such court should declare such portion, provision or provisions of this
Guaranty to be illegal, invalid, unlawful, void or unenforceable as written,
then it is the intent of all parties hereto that such portion, provision or
provisions shall be given force to the fullest possible extent that they are
legal, valid and enforceable, that the remainder of this Guaranty shall be
construed as if such illegal, invalid, unlawful, void or unenforceable portion,
provision or provisions were not contained therein, and that the rights,
obligations and interest of Agent, the Lenders and the holder(s) of the
Revolving Note or the Swingline Note under the remainder of this Guaranty shall
continue in full force and effect.

         9. Any indebtedness of Borrower to Guarantor now or hereafter existing
is hereby subordinated to the Facility Indebtedness. Guarantor agrees that until
the entire Facility Indebtedness has been paid in full, (i) Guarantor will not
seek, accept or retain for Guarantor's own account, any payment from Borrower on
account of such subordinated debt, and (ii) any such payments to Guarantor on
account of such subordinated debt shall be collected and received by Guarantor
in trust for Agent and the Lenders and shall be paid over to Agent on account of
the Facility Indebtedness without impairing or releasing the obligations of
Guarantor hereunder.

         10. Guarantor waives and releases any claim (within the meaning of 11
U.S.C. ss. 101) which Guarantor may have against Borrower arising from a payment
made by Guarantor under this Guaranty and agrees not to assert or take advantage
of any subrogation rights of Guarantor,

                                      D-5
<PAGE>

Agent or the Lenders or any right of Guarantor, Agent or the Lenders to proceed
against (i) Borrower for reimbursement, or (ii) any other guarantor or any
collateral security or guaranty or right of offset held by Agent or the Lenders
for the payment of the Facility Indebtedness and performance of the Obligations,
nor shall Guarantor seek or be entitled to seek any contribution or
reimbursement from Borrower or any other guarantor in respect of payments made
by Guarantor hereunder. It is expressly understood that the waivers and
agreements of Guarantor set forth above constitute additional and cumulative
benefits given to Agent and the Lenders for their security and as an inducement
for their continuing extension of credit to Borrower.

         11. Any amounts received by Agent or Lender from any source on account
of any indebtedness may be applied by Agent toward the payment of such
indebtedness, and in such order of application, as Agent may from time to time
elect.

         12. This Guaranty shall be governed by the internal laws of the State
of Illinois, without regard to its choice of law rules or conflict of laws
principles. The Guarantor hereby submits to personal jurisdiction in the State
of Illinois for the enforcement of this Guaranty and waives any and all personal
rights to object to such jurisdiction for the purposes of litigation to enforce
this Guaranty. Guarantor hereby consents to the jurisdiction of either the
Circuit Court of Cook County, Illinois, or the United States District Count for
the Northern District of Illinois, in any action, suit, or proceeding which
Agent or the Lenders may at any time wish to file in connection with this
Guaranty or any related matter. Guarantor hereby agrees that an action, suit, or
proceeding to enforce this Guaranty may be brought in any state or federal court
in the State of Illinois and hereby waives any objection which Guarantor may
have to the laying of the venue of any such action, suit, or proceeding in any
such court; provided, however, that the provisions of this Paragraph shall not
be deemed to preclude Agent or the Lenders from filing any such action, suit, or
proceeding in any other appropriate forum.

         13. All notices and other communications provided to any party hereto
under this Agreement or any other Loan Document shall be in writing or by
facsimile and addressed or delivered to such party at its address set forth
below or at such other address as may be designated by such party in a notice to
the other parties. Any notice, if mailed and properly addressed with postage
prepaid, shall be deemed given when received; any notice, if transmitted by
facsimile, shall be deemed given when transmitted. Notice may be given as
follows:

                  To the Guarantor:

                           ______________________________

                           ______________________________

                           Telephone: (___)______________

                           Telecopy: (___)_______________

                                      D-6
<PAGE>

                  With a copy to:

                           ______________________________

                           ______________________________

                           ______________________________

                  To the Agent or the Lenders:

                           Bank of America, N.A.
                           Real Estate Group
                           Structured Debt
                           231 South LaSalle Street, 12th Floor
                           IL1-231-12-18
                           Chicago, Illinois  60697
                           Attention:  Mark Lariviere
                           Telecopy:  (312) 974-4970

                           With a copy to:

                           Barack Ferrazzano Kirschbaum Perlman & Nagelberg
                           333 West Wacker Drive, Suite 2700
                           Chicago, Illinois 60606
                           Attention:  Howard J. Kirschbaum, Esq.
                           Telecopy:  (312) 984-3150

or at such other address as the party to be served with notice may have
furnished in writing to the party seeking or desiring to serve notice as a place
for the service of notice.

         14. This Guaranty shall be binding upon the heirs, executors, legal and
personal representatives, successors and assigns of Guarantor and shall inure to
the benefit of Agent's and Lender's successors and assigns.

         15. This Guaranty shall be construed and enforced under the internal
laws of the State of Illinois.

         16. The terms and provisions of Sections 14.18 and 14.19 of the Credit
Agreement are incorporated herein by reference.

                                      D-7
<PAGE>

         17. GUARANTOR AND AGENT AND THE LENDERS, BY ACCEPTANCE HEREOF, EACH
HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE
OR DEFEND ANY RIGHT UNDER THIS GUARANTY OR ANY OTHER LOAN DOCUMENT OR RELATING
THERETO OR ARISING FROM THE LENDING RELATIONSHIP WHICH IS THE SUBJECT OF THIS
GUARANTY AND AGREE THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A
COURT AND NOT BEFORE A JURY.

         IN WITNESS WHEREOF, Guarantor has delivered this Guaranty as of the
date first written above.

                                       -----------------------------------------

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

                                      D-8
<PAGE>

STATE OF _________________ )
                           )  SS.
COUNTY OF ________________ )

         I, the undersigned, a Notary Public, in and for said County, in the
State aforesaid, DO HEREBY CERTIFY, that _____________, the _____________ of
_____________, personally known to me to be the same person whose name is
subscribed to the foregoing instrument, appeared before me this day in person
and acknowledged that he signed and delivered the said instrument as his own
free and voluntary act and as the free and voluntary act of said corporation,
for the uses and purposes therein set forth.

GIVEN under my hand and Notarial Seal, this __ day of _____________, 2000.

                                                      --------------------------
                                                              Notary Public

                                      D-9
<PAGE>

                                    EXHIBIT E

                      OPINION OF BORROWER'S FLORIDA COUNSEL

                                (Attached Hereto)

                                      E-1
<PAGE>

                                    EXHIBIT F

                     OPINION OF BORROWER'S ILLINOIS COUNSEL

                                (Attached Hereto)

                                      F-1
<PAGE>

                                    EXHIBIT G

                               WIRING INSTRUCTIONS

To:      Bank of America, N.A., as Agent (the "Agent") under the Credit
         Agreement Described Below

         Re:      Second Amended and Restated Revolving Credit Agreement, dated
                  as of June ____, 2000 (as amended, modified, renewed or
                  extended from time to time, the "Agreement"), among LNR
                  Property Corporation and its Subsidiaries (the "Borrower"),
                  Agent and the Lenders named therein. Terms used herein and not
                  otherwise defined shall have the meanings assigned thereto in
                  the Agreement.

        The Agent is specifically authorized and directed to act upon the
following standing money transfer instructions with respect to the proceeds of
Advances or other extensions of credit from time to time until receipt by the
Agent of a specific written revocation of such instructions by the Borrower,
provided, however, that the Agent may also transfer funds as hereafter directed
in writing by the Borrower in accordance with Section 15.1 of the Agreement.

Facility Identification Number(s)
                                 -----------------------------------------------
Customer/Account Name
                     -----------------------------------------------------------
Transfer Funds To
                 ---------------------------------------------------------------

                 ---------------------------------------------------------------

For Account No.
               -----------------------------------------------------------------
Reference/Attention To
                      ----------------------------------------------------------

Authorized Officer (Customer Representative)         Date
                                                         -----------------------

--------------------------------                --------------------------------
(Please Print)                                  Signature

Bank Officer Name                               Date
                                                    ----------------------------

--------------------------------                --------------------------------
(Please Print)                                  Signature

    (Deliver Completed Form to Credit Support Staff For Immediate Processing)

                                      G-1
<PAGE>

                                    EXHIBIT H

                         FORM OF COMPLIANCE CERTIFICATE

To:      The Administrative Agent and the Lenders who are parties to the
         Agreement described below

        This Compliance Certificate is furnished pursuant to that certain Second
Amended and Restated Revolving Credit Agreement, dated as of June ____, 2000 (as
amended, modified, renewed or extended from time to time, the "Agreement") among
____________ ("____________") and certain of its Subsidiaries (collectively with
____________, "Borrower"), ____________, individually and as Agent, and the
Lenders named therein. Unless otherwise defined herein, capitalized terms used
in this Compliance Certificate have the respective meanings ascribed thereto in
the Agreement.

         THE UNDERSIGNED HEREBY CERTIFIES THAT:

         1. I am the duly elected [Chief Financial Officer] [Chief Accounting
Officer] [Controller] of _______________.

         2. I have reviewed the terms of the Agreement and I have made, or have
caused to be made under my supervision, a detailed review of the transactions
and financial condition of the Borrower and its Subsidiaries during the
accounting period covered by the financial statements attached (or most recently
delivered to the Agent if none are attached).

         3. The examinations described in paragraph 2 did not disclose, and I
have no knowledge of, the existence of any condition or event which constitutes
a Material Adverse Financial Change, Event of Default or Default during or at
the end of the accounting period covered by the attached financial statements or
as of the date of this Compliance Certificate, except as set forth below.

         4. Schedule I attached hereto (if attached) sets forth financial data
and computations and other information evidencing Borrower's compliance with the
covenants contained in Article VII of the Agreement and with certain other
covenants of the Agreement, all of which data, computations and information (or
if no Schedule I is attached, the data, computations and information contained
in the most recent Schedule I attached to a prior Compliance Certificate) are,
to the best of my knowledge after due inquiry, true, complete and correct in all
material respects.

         5. The financial statements, updates, reports and other materials
referred to in Section 8.2(i), 8.2(ii), 8.2(iv) and 8.2(viii) of the Agreement
which are delivered concurrently with the delivery of this Compliance
Certificate, if any, and those most recently delivered pursuant to Section
8.2(v) and Section 8.13 of the Agreement, if any, to the best of my knowledge
after due inquiry, fairly and accurately present in all material respects, (i)
in the case of financial statements, the consolidated financial condition and
operations of Borrower and their

                                      H-1
<PAGE>

respective Subsidiaries at such date and the consolidated results of their
operations for the period then-ended, in accordance with GAAP applied
consistently throughout such period and with prior periods and, (ii) in the case
of deliveries other than financial statements, the matters set forth therein as
of the dates and for the periods covered thereby; provided, however, that any
projections included therein constitute good faith estimates of reasonably
anticipated future matters which cannot be predicted with certainty.

         Described below are the exceptions, if any, to paragraph 3 by listing,
in detail, the nature of the condition or event, the period during which it has
existed and the action which the Borrower has taken, is taking, or proposes to
take with respect to each such condition or event:

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

         The foregoing certifications, together with the computations and
information set forth in Schedule I hereto and the financial statements,
updates, reports and other materials delivered with or covered by this
Compliance Certificate are made and delivered this __ day of __________, 2000.

                                             __________________________________,

                                             a Qualified Officer of ____________

                                      H-2
<PAGE>

                                    EXHIBIT I

                 SCOPE OF WORK FOR ENVIRONMENTAL INVESTIGATIONS

                         ENVIRONMENTAL SITE ASSESSMENTS
             Bank of America ("Bank of America") Reporting Standards

The following are ____________ Guidelines for the qualification of firms and for
information to be included in Environmental Site Assessments. These standards
include the minimum elements common to acceptable site assessments. Generally,
it is intended for the standards to be consistent with those outlined in the
American Society for Testing and Materials (ASTM) Designation: E 1527-93. This
listing is not intended to be a "how to" manual, as we rely on the environmental
professionals to expand the scope of their services and the information included
in the reports as required.

Qualifications of Investigating Firm

         The firm must have 5 years of experience in hazardous substances
         investigation. Many of these firms began as geotechnical consultants,
         but expertise only in soils analysis does not qualify them for
         hazardous substance analysis. The person supervising and signing the
         report should be experienced in all matters covered in the report. He
         should be a registered professional engineer or have advanced degrees
         in related disciplines. The firm performing the work should be of a
         professional nature with knowledge of local conditions.

Depth of Reporting Required

         Phase I - Consists of site description, review of historical and
         regulatory data and a physical inspection. If no potential
         contamination is indicated, the report should so state, and a specific
         statement should be made that no further investigation is required (see
         content requirements below).

         Phase II - If a Phase I examination indicates the possibility of
         contamination, the consultant should describe his suspicions, the areas
         to be tested, sampling procedures to be sued and methods used to assess
         the sample. He should then specify and carry out a testing program for
         further evaluation.

         Phase III - If Phase II reveals contamination at the site, the
         consultant will design and implement a remediation program to remove
         the identified hazardous materials. The report should include an
         estimated cost for the clean-up.

Bank of America will initially require a Phase I site assessment report
including the following:

Site Description

         The site description section should include a detailed description of
         the site, existing buildings and current site use. It should also
         include a general description of the uses and

                                      I-1
<PAGE>

         conditions of adjacent properties which might result in migrating
         contamination. It should include a summary of the visual observations
         including, but not limited to, vegetation stress, debris, fill
         materials, ponding, evidence of underground storage tanks, evidence of
         previous dumping or storage, discolored or stained soils, wetlands,
         groundwater flows, and a description of regional geology and hydrology.
         On vacant sites, the investigator should compare his observations to a
         USGS topographic map, noting any changes in elevations or depressions
         which have been covered over, possibly indicating past dumping or
         burial of wastes.

         On sites with existing improvements, the investigator should interview
         personnel at the site regarding hazardous materials currently or
         previously used at the site, underground storage tanks, pipeline right
         of ways and any other areas of concern. Buildings should be checked for
         asbestos containing materials, PCB equipment, etc.

Historical Uses of Site, Adjacent Properties, and Significant Nearby Properties

         The historical analysis should provide a chronology of past and present
         significant uses of the subject site and adjacent sites, and highlight
         activities which might have contributed unacceptable levels of
         contaminants. It should contain an explanation of the methods of
         historical search which were pursued, the information expected to be
         obtained and the information actually obtained from each search. In
         general, the historical review should cover 30-40 years of history
         depending on the availability of information. Its purpose is to
         investigate the possibility of prior hazardous substances releases at
         the property, identify potential contingent liability from historic
         off-site disposal of hazardous substances, or identify sources of
         contamination which have or might in the future migrate to the site.

         The historical analysis should include but not be limited to:

         o        Review of aerial photographs to identify past land uses and
                  development trends, and identify possible locations of ponds,
                  landfills, tanks, areas of soil discoloration or drum storage.

         o        Review of county tax records or title search to identify past
                  uses of potential concern such as gas stations or industrial
                  uses.

         o        Conversations with local environmental and health officials,
                  investigation of local, state and federal regulatory agencies
                  files including the EPA, DER and Corps of Engineers, and a
                  check of EPA lists of known contaminated sites, to check for
                  recorded hazardous substances handling, or potential
                  permitting requirements of air emissions, wastewater, RCRA or
                  TSD permits.

         Other information which may be attached to the report include, but
should not be limited to:

         o        A discussion of existing and proposed environmental standards
                  and legislation of the area

                                      I-2
<PAGE>

         o        Site Plan

         o        Ground level photos of the site with specific attention to any
                  characteristics noted in the report

         o        Area diagram showing the location of any matters mentioned in
                  the report and showing the site and adjacent properties if any
                  potential hazardous sources are identified on adjacent or
                  nearby properties

         o        Copies of representative aerial photos

         o        Copies of correspondence with regulatory agencies

         o        Documents acquired during title search

         o        Chain of custody records

         o        Location map of site and immediate surroundings

         o        Listing of adjacent property owners and use of the properties

         o        Any other material available which describes or verifies
                  information given or conclusions drawn in the report

Conclusions and Recommendations

         The Consultant will prepare a complete written report which fully
         defines the scope of his responsibilities and objectives. It should
         describe the sources used, the activities performed, the dates when
         activities were performed, the results of research and recommendations.
         Specific recommendations for remedial action, additional tests or
         investigations for each recognized area of concern or condition and
         approximate costs of further investigation or remediation shall be
         provided within the report.

         The conclusion section must clearly state that the firm has exercised
         professional judgment in reaching one of the following:

                  The Consultant, after performing the appropriate level of
                  investigation, has revealed no evidence of recognized
                  environmental conditions in connection with the subject
                  property and no further testing or investigation is warranted.

         or

                  The Consultant, after performing the appropriate level of
                  investigation, has revealed no evidence of recognized
                  environmental conditions in connection with the subject
                  property except for the following:

         If the Consultant was restricted by factors such as time limitations or
         scope-of-service limitations agreed to with the borrower, the report
         should so state.

                                      I-3
<PAGE>

         The report is to be signed by a professional engineer, environmental
         manager or supervisor or any other individuals who provide significant
         professional assistance in completing the assignment. The
         qualifications of the individuals signing the report should be
         included.

                                      I-4
<PAGE>

                                    EXHIBIT J

                          FORM OF ASSIGNMENT AGREEMENT

         This Assignment Agreement (this "Assignment Agreement") between (the
"Assignor") and , (the "Assignee") is dated as of __________, ___. The parties
hereto agree as follows:

         1. PRELIMINARY STATEMENT. The Assignor is a party to a Second Amended
and Restated Revolving Credit Agreement (which, as it may be amended, modified,
renewed or extended from time to time is herein called the "Credit Agreement")
described in Item 1 of Schedule 1 attached hereto ("Schedule 1"). Capitalized
terms used herein and not otherwise defined herein shall have the meanings
attributed to them in the Credit Agreement.

         2. ASSIGNMENT AND ASSUMPTION. The Assignor hereby sells and assigns to
the Assignee, and the Assignee hereby purchases and assumes from the Assignor,
an interest in and to the Assignor's rights and obligations under the Credit
Agreement such that after giving effect to such assignment the Assignee shall
have purchased pursuant to this Assignment Agreement the percentage interest
specified in Item 3 of Schedule 1 of all outstanding rights and obligations
under the Credit Agreement and the other Loan Documents. The aggregate
Commitment (or Loans, if the applicable Commitment has been terminated)
purchased by the Assignee hereunder is set forth in Item 4 of Schedule 1.

         3. EFFECTIVE DATE. The effective date of this Assignment Agreement (the
"Effective Date") shall be the later of the date specified in Item 5 of Schedule
1 or two (2) Business Days (or such shorter period agreed to by the Agent) after
a Notice of Assignment substantially in the form of Exhibit "I" attached hereto
has been delivered to the Agent. In no event will the Effective Date occur if
the payments required to be made by the Assignee to the Assignor on the
Effective Date under Sections 4 and 5 hereof are not made on the proposed
Effective Date, unless otherwise agreed to in writing by Assignor and Assignee.
The Assignor will notify the Assignee of the proposed Effective Date no later
than the Business Day prior to the proposed Effective Date. As of the Effective
Date, (i) the Assignee shall have the rights and obligations of a Lender under
the Loan Documents with respect to the rights and obligations assigned to the
Assignee hereunder and (ii) the Assignor shall relinquish its rights and be
released from its corresponding obligations under the Loan Documents with
respect to the rights and obligations assigned to the Assignee hereunder.

         4. PAYMENTS OBLIGATIONS. On and after the Effective Date, the Assignee
shall be entitled to receive from the Agent all payments of principal, interest
and fees with respect to the interest assigned hereby. The Assignee shall
advance funds directly to the Agent with respect to all Loans and reimbursement
payments made on or after the Effective Date with respect to the interest
assigned hereby. [In consideration for the sale and assignment of Loans
hereunder, (i) the Assignee shall pay the Assignor, on the Effective Date, an
amount equal to the principal amount of the portion of all Base Rate Loans
assigned to the Assignee hereunder and

                                      J-1
<PAGE>

(ii) with respect to each LIBOR Loan made by the Assignor and assigned to the
Assignee hereunder which is outstanding on the Effective Date, (a) on the last
day of the Interest Period therefor or (b) on such earlier date agreed to by the
Assignor and the Assignee or (c) on the date on which any such Loan either
becomes due (by acceleration or otherwise) or is prepaid (the date as described
in the foregoing clauses (a), (b) or (c) being hereinafter referred to as the
"Fixed Due Date"), the Assignee shall pay the Assignor an amount equal to the
principal amount of the portion of such Loan assigned to the Assignee which is
outstanding on the Fixed Due Date. If the Assignor and the Assignee agree that
the applicable Fixed Due Date for such Loan shall be the Effective Date, they
shall agree, solely for purposes of dividing interest paid by the Borrower on
such Loan, to an alternate interest rate applicable to the portion of such Loan
assigned hereunder for the period from the Effective Date to the end of the
related Interest Period (the "Agreed Interest Rate") and any interest received
by the Assignee in excess of the Agreed Interest Rate, with respect to such Loan
for such period, shall be remitted to the Assignor. In the event a prepayment of
any Loan which is existing on the Effective Date and assigned by the Assignor to
the Assignee hereunder occurs after the Effective Date but before the applicable
Fixed Due Date, the Assignee shall remit to the Assignor any excess of the
funding indemnification amount paid by the Borrower under Section 4.4 of the
Credit Agreement on account of such prepayment with respect to the portion of
such Loan assigned to the Assignee hereunder over the amount which would have
been paid if such prepayment amount were calculated based on the Agreed Interest
Rate and only covered the portion of the Interest Period after the Effective
Date. The Assignee will promptly remit to the Assignor (i) the portion of any
principal payments assigned hereunder and received from the Agent with respect
to any such Loan prior to its Fixed Due Date and (ii) any amounts of interest on
Loans and fees received from the Agent which relate to the portion of the Loans
assigned to the Assignee hereunder for periods prior to the Effective Date, in
the case of Base Rate Loans or fees, or the Fixed Due Date, in the case of LIBOR
Loans, and not previously paid by the Assignee to the Assignor.]* In the event
that either party hereto receives any payment to which the other party hereto is
entitled under this Assignment Agreement, then the party receiving such amount
shall promptly remit it to the other party hereto.

         5. FEES PAYABLE BY THE ASSIGNEE. The Assignee shall pay to the Assignor
a fee on each day on which a payment of interest or fees is made under the
Credit Agreement with respect to the amounts assigned to the Assignee hereunder
(other than a payment of interest or fees attributable to the period prior to
the Effective Date or, in the case of LIBOR Loans, the Payment Date, which the
Assignee is obligated to deliver to the Assignor pursuant to Section 4 hereof).
The amount of such fee shall be the difference between (i) the interest or fee,
as applicable, paid with respect to the amounts assigned to the Assignee
hereunder and (ii) the interest or fee, as applicable, which would have been
paid with respect to the amounts assigned to the Assignee hereunder if each
interest rate was calculated at the rate of _% rather than the actual percentage
used to calculate the interest rate paid by the Borrower or if the fee was
calculated at the rate of ___% rather than the actual percentage used to
calculate the fee paid by the Borrower, as applicable. In addition, the Assignee
agrees to pay ___% of the fee required to be paid to the Agent in connection
with this Assignment Agreement. [This sentence can be revised appropriately
based on how the fee is being paid.]

* Each Assignor may insert its standard provisions in lieu of the payment terms
included in Sections 4 and 5 of this Exhibit.

                                      J-2
<PAGE>

         6. REPRESENTATIONS OF THE ASSIGNOR: LIMITATIONS ON THE ASSIGNOR'S
LIABILITY. The Assignor represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim created by the Assignor. It is
understood and agreed that the assignment and assumption hereunder are made
without recourse to the Assignor and that the Assignor makes no other
representation or warranty of any kind to the Assignee. Neither the Assignor nor
any of its officers, directors, employees, agents or attorneys shall be
responsible for (i) the due execution, legality, validity, enforceability,
genuineness, sufficiency or collectability of any Loan Document, including
without limitation, documents granting the Assignor and the other Lenders a
security interest in assets of the Borrower or any guarantor, (ii) any
representation, warranty or statement made in or in connection with any of the
Loan Documents, (iii) the financial condition or creditworthiness of the
Borrower or any guarantor, (iv) the performance of or compliance with any of the
terms or provisions of any of the Loan Documents, (v) inspecting any of the Real
Estate, books or records of the Borrower, its Subsidiaries or Investment
Affiliates, (vi) the validity, enforceability, perfection, priority, condition,
value or sufficiency of any collateral securing or purporting to secure the
Loans or (vii) any mistake, error of judgment, or action taken or omitted to be
taken in connection with the Loans or the Loan Documents.

         7. REPRESENTATIONS OF THE ASSIGNEE. The Assignee (i) confirms that it
has received a copy of the Credit Agreement and the other Loan Documents,
together with copies of the financial statements requested by the Assignee and
such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into this Assignment Agreement, (ii)
agrees that it will, independently and without reliance upon the Agent, the
Assignor or any other Lender and based on such documents and information at it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Loan Documents, (iii) appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers under the Loan Documents as are delegated to the Agent by the terms
thereof, together with such powers as are reasonably incidental thereto, (iv)
agrees that it will perform in accordance with their terms all of the
obligations which by the terms of the Loan Documents are required to be
performed by it as a Lender, (v) agrees that its payment instructions and notice
instructions are as set forth in the attachment to Schedule 1, (vi) confirms
that none of the funds, monies, assets or other consideration being used to make
the purchase and assumption hereunder are "plan assets" as defined under ERISA
and that its rights, benefits and interests in and under the Loan Documents will
not be "plan assets" under ERISA, [and (vii) attaches the forms prescribed by
the Internal Revenue Service of the United States certifying that the Assignee
is entitled to receive payments under the Loan Documents without deduction or
withholding of any United States federal income taxes].**

** to be inserted if the Assignee is not incorporated under the laws of the
United States, or a state thereof.

         8. INDEMNITY. The Assignee agrees to indemnify and hold the Assignor
harmless against any and all losses, costs and expenses (including, without
limitation, reasonable attorneys' fees) and liabilities incurred by the Assignor
in connection with or arising in any

                                      J-3
<PAGE>

manner from the Assignee's non-performance of the obligations assumed under this
Assignment Agreement.

         9. SUBSEQUENT ASSIGNMENTS. After the Effective Date, the Assignee shall
have the right pursuant to Section 13.3.1 of the Credit Agreement to assign the
rights which are assigned to the Assignee hereunder to any entity or person,
provided that (i) any such subsequent assignment does not violate any of the
terms and conditions of the Loan Documents or any law, rule, regulation, order,
writ, judgment, injunction or decree and that any consent required under the
terms of the Loan Documents has been obtained and (ii) unless the prior written
consent of the Assignor is obtained, the Assignee is not thereby released from
its obligations to the Assignor hereunder, if any remain unsatisfied, including,
without limitation, its obligations under Sections 4, 5 and 8 hereof.

         10. REDUCTIONS OF AGGREGATE COMMITMENT. If any reduction in the
Aggregate Commitment occurs between the date of this Assignment Agreement and
the Effective Date, the percentage interest specified in Item 3 of Schedule 1
shall remain the same, but the dollar amount purchased shall be recalculated
based on the reduced Aggregate Commitment.

         11. ENTIRE AGREEMENT. This Assignment Agreement and the attached Notice
of Assignment embody the entire agreement and understanding between the parties
hereto and supersede all prior agreements and understandings between the parties
hereto relating to the subject matter hereof.

         12. GOVERNING LAW. This Assignment Agreement shall be governed by the
internal law, and not the law of conflicts, of the State of Illinois.

         13. NOTICES. Notices shall be given under this Assignment Agreement in
the manner set forth in the Credit Agreement. For the purpose hereof, the
addresses of the parties hereto until notice of a change is delivered) shall be
the address set forth in the attachment to Schedule 1.

                                      J-4
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have executed this Assignment
Agreement by their duly authorized officers as of the date first above written.

                                         [NAME OF ASSIGNOR]

                                         By:
                                            ------------------------------------
                                         Title:
                                               ---------------------------------

                                         [NAME OF ASSIGNEE]

                                         By:
                                            ------------------------------------
                                         Title:
                                               ---------------------------------

                                      J-5
<PAGE>

                                    EXHIBIT K

                                 FORM OF REPORT

                                      K-1
<PAGE>

                                   SCHEDULE I
                              BORROWER SUBSIDIARIES

                                  (Page 1 of 8)

----------------------------------------------------------------
128th Street Associates, LLC
----------------------------------------------------------------
128th Street Manager, Inc.
----------------------------------------------------------------
Academy Heights Housing Partners, LLC
----------------------------------------------------------------
Alexandria LP, Inc.
----------------------------------------------------------------
Alexandria LP-II, Inc.
----------------------------------------------------------------
American Pacific Properties, Inc.
----------------------------------------------------------------
Anaheim Housing Partners, LLC
----------------------------------------------------------------
Antelope Housing, Inc.
----------------------------------------------------------------
Arbor Lake Club, Ltd.
----------------------------------------------------------------
Arsenal Capital Holdings, Inc.
----------------------------------------------------------------
Atlantic Holdings, Inc.
----------------------------------------------------------------
Aurora LP, Inc.
----------------------------------------------------------------
Bert L. Smokler & Company
----------------------------------------------------------------
DCA Homes, Inc.
----------------------------------------------------------------
DCA Management Corporation
----------------------------------------------------------------
Delaware Securities Holding, Inc.
----------------------------------------------------------------
Devco Shopping Centers, Inc.
----------------------------------------------------------------
Devonshire Capital Holdings, Inc.
----------------------------------------------------------------
Doral Park JV
----------------------------------------------------------------
Eastlake Village, LLC
----------------------------------------------------------------
H. Miller & Sons of Florida, Inc.
----------------------------------------------------------------
H. Miller & Sons, Inc.
----------------------------------------------------------------
HMS Realty, Inc.
----------------------------------------------------------------
Houston LP, Inc.
----------------------------------------------------------------
Houston LP-II, Inc.
----------------------------------------------------------------
Houston LP-III, Inc.
----------------------------------------------------------------
Legacy LP, Inc.
----------------------------------------------------------------
Legend Oaks Limited Partnership
----------------------------------------------------------------
Leisure Colony Management Corp.
----------------------------------------------------------------
Leisure Communities Management, Inc.
----------------------------------------------------------------
Lennar Atlantic Holdings, Inc.
----------------------------------------------------------------
Lennar California Partners, Inc.
----------------------------------------------------------------
Lennar Capital Corporation
----------------------------------------------------------------
Lennar Capital Services, Inc.
----------------------------------------------------------------
Lennar Central Holdings, Inc.
----------------------------------------------------------------
Lennar CGA Holdings, Inc.
----------------------------------------------------------------
Lennar Commercial Properties, Inc.
----------------------------------------------------------------
Lennar Communications, Inc.
----------------------------------------------------------------

<PAGE>

                              SCHEDULE I, continued

                                  (Page 2 of 8)

----------------------------------------------------------------
Lennar Corporate Center, Inc.
----------------------------------------------------------------
Lennar Funding Corporation
----------------------------------------------------------------
Lennar Georgia Partners, Inc.
----------------------------------------------------------------
Lennar Kearny Holdings, Inc.
----------------------------------------------------------------
Lennar L.W. Assets, Inc.
----------------------------------------------------------------
Lennar Legend Oaks Holdings, Inc.
----------------------------------------------------------------
Lennar LW Nevada Assets, Inc.
----------------------------------------------------------------
Lennar Marietta Holdings, Inc.
----------------------------------------------------------------
Lennar Mayfair Holdings, Inc.
----------------------------------------------------------------
Lennar Mortgage Holdings Corporation
----------------------------------------------------------------
Lennar Mortgage Holdings I, Inc.
----------------------------------------------------------------
Lennar Nevada Partners, Inc.
----------------------------------------------------------------
Lennar Northeast Holdings, Inc.
----------------------------------------------------------------
Lennar Park Center III Holdings, Inc.
----------------------------------------------------------------
Lennar Park JV, Inc.
----------------------------------------------------------------
Lennar Partners of Los Angeles, Inc.
----------------------------------------------------------------
Lennar Partners, Inc.
----------------------------------------------------------------
Lennar Real Estate Holdings, Inc.
----------------------------------------------------------------
Lennar Rolling Ridge, Inc.
----------------------------------------------------------------
Lennar Securities Holdings, Inc.
----------------------------------------------------------------
Lennar U.S. Holdings, Inc.
----------------------------------------------------------------
Lennar Western Holdings, Inc.
----------------------------------------------------------------
Lennar Wilshire Holdings, Inc.
----------------------------------------------------------------
Lennar-Corry, Inc.
----------------------------------------------------------------
LFS Asset Corp.
----------------------------------------------------------------
Lily Lane  Housing Partners, LLC
----------------------------------------------------------------
LNR 16th Street, Inc.
----------------------------------------------------------------
LNR 2000 Fund I MM, Inc.
----------------------------------------------------------------
LNR 2000 Fund II MM, Inc.
----------------------------------------------------------------
LNR 2000 Fund II, LLC
----------------------------------------------------------------
LNR 909 4th Y Investor, LLC
----------------------------------------------------------------
LNR 909 4th Y Limited, Inc.
----------------------------------------------------------------
LNR 99 Fund I IM, LLC
----------------------------------------------------------------
LNR 99 Fund I MM, Inc.
----------------------------------------------------------------
LNR Academy Heights Investor, LLC
----------------------------------------------------------------
LNR Academy Heights Limited, Inc.
----------------------------------------------------------------
LNR Affordable Housing Investments
----------------------------------------------------------------
LNR Affordable Housing, Inc.
----------------------------------------------------------------
LNR Alexandria Holdings, Inc.
----------------------------------------------------------------
LNR Altoona Limited, Inc.
----------------------------------------------------------------

<PAGE>

                              SCHEDULE I, continued

                                  (Page 3 of 8)

----------------------------------------------------------------
LNR Anaheim Housing Investor, LLC
----------------------------------------------------------------
LNR Anaheim Housing Limited, Inc.
----------------------------------------------------------------
LNR Anderson Farms Limited, Inc.
----------------------------------------------------------------
LNR Apache Junction Investor, LLC
----------------------------------------------------------------
LNR Apache Junction Limited, Inc.
----------------------------------------------------------------
LNR Apache Pines Investor, LLC
----------------------------------------------------------------
LNR Apache Pines Limited, Inc.
----------------------------------------------------------------
LNR Apple Tree Investor, LLC
----------------------------------------------------------------
LNR Apple Tree Village Limited, Inc.
----------------------------------------------------------------
LNR Arbor Millhouse, LLC
----------------------------------------------------------------
LNR Arrowhead Ranch Holdings, Inc.
----------------------------------------------------------------
LNR Ashworth Woods Limited, Inc.
----------------------------------------------------------------
LNR Auburn Limited, Inc.
----------------------------------------------------------------
LNR Austin Holdings, Inc
----------------------------------------------------------------
LNR Avondale Holdings, Inc.
----------------------------------------------------------------
LNR Belleville Investor, LLC
----------------------------------------------------------------
LNR Belleville Limited, Inc.
----------------------------------------------------------------
LNR Boalsburg II Investor, LLC
----------------------------------------------------------------
LNR Boalsburg II Limited, Inc.
----------------------------------------------------------------
LNR Boardwalk Limited, Inc.
----------------------------------------------------------------
LNR Bressi Ranch, Inc.
----------------------------------------------------------------
LNR Brickell Bayview Corporation
----------------------------------------------------------------
LNR Burlington Square Limited, Inc.
----------------------------------------------------------------
LNR California Investments, Inc.
----------------------------------------------------------------
LNR Canyon Rim Investor, LLC
----------------------------------------------------------------
LNR Canyon Rim Limited, Inc.
----------------------------------------------------------------
LNR Caprock GP, LLC
----------------------------------------------------------------
LNR Caprock Holdings, Inc.
----------------------------------------------------------------
LNR Cedar River Limited, Inc.
----------------------------------------------------------------
LNR Centennial East Investor, LLC
----------------------------------------------------------------
LNR Centennial East Limited, Inc.
----------------------------------------------------------------
LNR Central Senior Investor, LLC
----------------------------------------------------------------
LNR Central Senior Limited, Inc.
----------------------------------------------------------------
LNR Clare House Investor, LLC
----------------------------------------------------------------
LNR Clare House Limited, Inc.
----------------------------------------------------------------
LNR Clark Holdings, Inc.
----------------------------------------------------------------
LNR Clark, LLC
----------------------------------------------------------------
LNR Clayton Meadows Investor, LLC
----------------------------------------------------------------
LNR Clayton Meadows Limited, Inc.
----------------------------------------------------------------

<PAGE>

                              SCHEDULE I, continued

                                  (Page 4 of 8)

----------------------------------------------------------------
LNR CMBS Holdings Corp.
----------------------------------------------------------------
LNR Colorado Highlands Holdings, Inc.
----------------------------------------------------------------
LNR Commencement Limited, Inc.
----------------------------------------------------------------
LNR Conservatory Place Court Limited, Inc.
----------------------------------------------------------------
LNR Country Village Limited, Inc.
----------------------------------------------------------------
LNR Covey Run Investor, LLC
----------------------------------------------------------------
LNR Covey Run Limited, Inc.
----------------------------------------------------------------
LNR Crossroads Marketplace, LLC
----------------------------------------------------------------
LNR Deer Creek Limited, Inc.
----------------------------------------------------------------
LNR DSHI Interhold, Inc.
----------------------------------------------------------------
LNR Durant Investor, LLC
----------------------------------------------------------------
LNR Durant Limited, Inc.
----------------------------------------------------------------
LNR East Wenatchee Limited, Inc.
----------------------------------------------------------------
LNR Eastern Lending, LLC
----------------------------------------------------------------
LNR Eastlake Village Investor, LLC
----------------------------------------------------------------
LNR Eastlake Village Limited, Inc.
----------------------------------------------------------------
LNR Edgefield Senior Investor, LLC
----------------------------------------------------------------
LNR Edgefield Senior Limited, Inc.
----------------------------------------------------------------
LNR Englewood Limited, Inc.
----------------------------------------------------------------
LNR Essex Investor, LLC
----------------------------------------------------------------
LNR Essex Limited, Inc.
----------------------------------------------------------------
LNR Executive Tower, Inc.
----------------------------------------------------------------
LNR Federal Way Limited, Inc.
----------------------------------------------------------------
LNR Fenix Limited, Inc.
----------------------------------------------------------------
LNR Five Corners Investor, LLC
----------------------------------------------------------------
LNR Florida Affordable Housing, Inc.
----------------------------------------------------------------
LNR Florida Funding, Inc.
----------------------------------------------------------------
LNR Glisan Investor, LLC
----------------------------------------------------------------
LNR Gowe Court Limited, Inc.
----------------------------------------------------------------
LNR Hamilton Holdings, Inc.
----------------------------------------------------------------
LNR Harbor Bay, LLC
----------------------------------------------------------------
LNR Harbor Fund GP IV, Inc.
----------------------------------------------------------------
LNR Harbor Fund GP IX, Inc.
----------------------------------------------------------------
LNR Harbor Fund GP V, Inc.
----------------------------------------------------------------
LNR Harbor Fund GP VIII, Inc.
----------------------------------------------------------------
LNR Harbor Fund Limited Partnership No. III
----------------------------------------------------------------
LNR Harbor Fund Limited Partnership No. IV
----------------------------------------------------------------
LNR Harbor Fund Limited Partnership No. IX
----------------------------------------------------------------
LNR Harbor Fund Limited Partnership No. V
----------------------------------------------------------------

<PAGE>

                              SCHEDULE I, continued

                                  (Page 5 of 8)

----------------------------------------------------------------
LNR Harbor Fund Limited Partnership No. VIII
----------------------------------------------------------------
LNR Hastings Limited, Inc.
----------------------------------------------------------------
LNR Hawthorne, Inc.
----------------------------------------------------------------
LNR Henderson Cottages Investor, LLC
----------------------------------------------------------------
LNR Henderson Cottages Limited, Inc.
----------------------------------------------------------------
LNR Horizon Pines Investor, LLC
----------------------------------------------------------------
LNR Horizon Pines limited, Inc.
----------------------------------------------------------------
LNR Kearny Mesa, Inc.
----------------------------------------------------------------
LNR Lafayette Holdings, Inc.
----------------------------------------------------------------
LNR Lafayette LP, Inc.
----------------------------------------------------------------
LNR Lake Placid Holdings, Inc.
----------------------------------------------------------------
LNR Lake Wood Ranch II Investor, LLC
----------------------------------------------------------------
LNR Land Partners Sub II, Inc.
----------------------------------------------------------------
LNR Land Partners Sub, Inc.
----------------------------------------------------------------
LNR Lily Lane Investor, LLC
----------------------------------------------------------------
LNR Lily Lane Limited, Inc.
----------------------------------------------------------------
LNR LLC Investor, Inc.
----------------------------------------------------------------
LNR LLC Manager, Inc.
----------------------------------------------------------------
LNR LP Holdings, Inc.
----------------------------------------------------------------
LNR Madison Square, Inc.
----------------------------------------------------------------
LNR Mare Island, Inc.
----------------------------------------------------------------
LNR Meeker Court Limited, Inc.
----------------------------------------------------------------
LNR Memphis Holdings, Inc.
----------------------------------------------------------------
LNR Memphis LP, Inc.
----------------------------------------------------------------
LNR Mojave Investor, LLC
----------------------------------------------------------------
LNR Newport Plaza, Inc.
----------------------------------------------------------------
LNR Oak Point, Inc.
----------------------------------------------------------------
LNR Orange Tree Investor, LLC
----------------------------------------------------------------
LNR Orange Tree Village Limited, Inc.
----------------------------------------------------------------
LNR Orlando Limited, Inc.
----------------------------------------------------------------
LNR Parallel Holdings, Inc.
----------------------------------------------------------------
LNR Paredes Developers, LLC
----------------------------------------------------------------
LNR Paredes Investors, LLC
----------------------------------------------------------------
LNR Park Court Limited, Inc.
----------------------------------------------------------------
LNR Park Crest Limited, Inc.
----------------------------------------------------------------
LNR Partners Japan, Inc.
----------------------------------------------------------------
LNR Philadelphia Place I, Inc.
----------------------------------------------------------------
LNR Philadelphia Place II, Inc.
----------------------------------------------------------------
LNR Philadelphia Place III, LLC
----------------------------------------------------------------
LNR Philadelphia Place IV, LLC
----------------------------------------------------------------

<PAGE>

                              SCHEDULE I, continued

                                  (Page 6 of 8)

----------------------------------------------------------------
LNR Phoenix LP, Inc.
----------------------------------------------------------------
LNR Phoenix LP-II, Inc.
----------------------------------------------------------------
LNR Phoenix LP-III, Inc.
----------------------------------------------------------------
LNR Port Washington Investor, LLC
----------------------------------------------------------------
LNR Port Washington Limited, Inc.
----------------------------------------------------------------
LNR Property Corporation
----------------------------------------------------------------
LNR Quayside Place Holdings, Inc.
----------------------------------------------------------------
LNR Quincy Crossings, LLC
----------------------------------------------------------------
LNR Racine Street Investor, LLC
----------------------------------------------------------------
LNR Racine Street Limited, Inc.
----------------------------------------------------------------
LNR Redhill Manager, Inc.
----------------------------------------------------------------
LNR Redhill, LLC
----------------------------------------------------------------
LNR Related Venture, Inc.
----------------------------------------------------------------
LNR REMIC Holdings, LLC
----------------------------------------------------------------
LNR Renaissance Manager, Inc.
----------------------------------------------------------------
LNR Renaissance Square, LLC
----------------------------------------------------------------
LNR Richland Limited, Inc.
----------------------------------------------------------------
LNR River Oaks Investor, LLC
----------------------------------------------------------------
LNR Riverwood Village Investor, LLC
----------------------------------------------------------------
LNR Riverwood Village Limited, Inc.
----------------------------------------------------------------
LNR Rocky Mountain Partners, Inc.
----------------------------------------------------------------
LNR San Diego Spectrum I, Inc.
----------------------------------------------------------------
LNR Sands Holdings, Inc.
----------------------------------------------------------------
LNR Santa Clara I, LLC
----------------------------------------------------------------
LNR Santa Fe Investor II, LLC
----------------------------------------------------------------
LNR Santa Fe Limited II,  Inc.
----------------------------------------------------------------
LNR Santa Fe Limited, Inc.
----------------------------------------------------------------
LNR Santa Rosa Gardens Investor, LLC
----------------------------------------------------------------
LNR Santa Rosa Gardens Limited, Inc.
----------------------------------------------------------------
LNR Santa Teresa Investor, LLC
----------------------------------------------------------------
LNR Seaview, Inc.
----------------------------------------------------------------
LNR Shelf I, Inc.
----------------------------------------------------------------
LNR Snow Cap Investor, LLC
----------------------------------------------------------------
LNR Snow Cap Limited, Inc.
----------------------------------------------------------------
LNR South Forty Limited, Inc.
----------------------------------------------------------------
LNR South Jordan II, LLC
----------------------------------------------------------------
LNR Spring Wood Investor, LLC
----------------------------------------------------------------
LNR Spring Wood Limited, Inc.
----------------------------------------------------------------
LNR Stewart Pines Investor, LLC
----------------------------------------------------------------

<PAGE>

                              SCHEDULE I, continued

                                  (Page 7 of 8)

----------------------------------------------------------------
LNR Stewart Pines Limited, Inc.
----------------------------------------------------------------
[Intentionally Omitted]
----------------------------------------------------------------
LNR Sunflower Limited, Inc.
----------------------------------------------------------------
LNR Surrey Row Limited, Inc.
----------------------------------------------------------------
LNR Titus Limited, Inc.
----------------------------------------------------------------
LNR Town Center Investor, LLC
----------------------------------------------------------------
LNR Trail at The Park Limited, Inc.
----------------------------------------------------------------
LNR Tri-Court Limited, Inc.
----------------------------------------------------------------
LNR Tropical Pines Investor, LLC
----------------------------------------------------------------
LNR Tropical Pines Limited, Inc.
----------------------------------------------------------------
LNR Van Buren Holdings, Inc.
----------------------------------------------------------------
LNR Verandah Holdings, Inc.
----------------------------------------------------------------
LNR Village Green Investor, LLC
----------------------------------------------------------------
LNR Vista Ridge Investor, LLC
----------------------------------------------------------------
LNR West Lincoln Investor, LLC
----------------------------------------------------------------
LNR West Lincoln Limited, Inc.
----------------------------------------------------------------
LNR West Oaks Holdings, Inc.
----------------------------------------------------------------
LNR West Valley Investor, LLC
----------------------------------------------------------------
LNR West Valley Limited, Inc.
----------------------------------------------------------------
LNR Westchase Holdings, Inc.
----------------------------------------------------------------
LNR Western Properties, Inc.
----------------------------------------------------------------
LNR Wiedemann Park Limited, Inc.
----------------------------------------------------------------
LNR Willamette Court Limited, Inc.
----------------------------------------------------------------
LNR Willow Tree Investor, LLC
----------------------------------------------------------------
LNR Willow Tree Limited, Inc.
----------------------------------------------------------------
LNR Windhaven Limited, Inc.
----------------------------------------------------------------
LNR Woodspring Limited, Inc.
----------------------------------------------------------------
Miller's Plantation Development Company
----------------------------------------------------------------
Nevada Securities Holdings, Inc.
----------------------------------------------------------------
Parkview Associates, Inc.
----------------------------------------------------------------
Parkview at Pembroke Pointe, Inc.
----------------------------------------------------------------
Parkview Partnership, Ltd.
----------------------------------------------------------------
Port Washington Retirement Community, LLC
----------------------------------------------------------------
Prado Apartments Limited
----------------------------------------------------------------
Rollingcrest Inc.
----------------------------------------------------------------
Santa Fe Senior Housing Limited Partnership
----------------------------------------------------------------
South Dade Utilities, Inc.
----------------------------------------------------------------
Springs Development Corporation
----------------------------------------------------------------
The Dreyfus Interstate Development Corporation
----------------------------------------------------------------

<PAGE>

                              SCHEDULE I, continued

                                  (Page 8 of 8)

----------------------------------------------------------------
The Turtle Run Venture
----------------------------------------------------------------
Universal American Realty Corporation
----------------------------------------------------------------
Village Green Apartments Limited Partnership
----------------------------------------------------------------
Vista del Lago Apartments, Inc.
----------------------------------------------------------------
Vista Ridge Housing Developers, LLC
----------------------------------------------------------------
Vista Ridge Housing Limited Partnership
----------------------------------------------------------------
West Coast Mortgage Holdings, Inc.
----------------------------------------------------------------
West Valley Housing Partners, LLC
----------------------------------------------------------------

<PAGE>

                                   SCHEDULE II

                              BORROWING BASE CHART
<TABLE>
<CAPTION>
-------------------------------------- -------------------------- ------------------ -----------------------------------------------
      BORROWING BASE COMPONENT           ASSET VALUATION METHOD    ADVANCE FORMULA                     LIMITATIONS
-------------------------------------- -------------------------- ------------------ -----------------------------------------------
1.     Cash Equivalents                Net Book Value                   100%         None
-------------------------------------- -------------------------- ------------------ -----------------------------------------------
<S>                                    <C>                              <C>          <C>
2.     Stabilized Projects             Adjusted Net Operating           75%          The amount included in Borrowing Base for
                                       Income capitalized at 10%                     Stabilized Projects which are Special Purpose
                                                                                     Properties shall not exceed 15% of total
                                                                                     Borrowing Base.
-------------------------------------- -------------------------- ------------------ -----------------------------------------------

3. a.  Completed Projects              Net Book Value                   67.5%        The amount included in Borrowing Base for
                                                                                     Completed Projects which are Special Purpose
                                                                                     Properties shall not exceed 10% of total amount
                                                                                     in Borrowing Base.

                                                                                     The amount included in Borrowing Base for
                                                                                     Completed Projects and Stabilized Projects
                                                                                     which are Special Purpose Properties shall
                                                                                     not exceed 20% of total Borrowing Base.

    b. Development Properties          Net Book Value                   67.5%        No Development Properties which are Special
                                                                                     Purpose Properties shall be included in the
                                                                                     Borrowing Base without the prior written
                                                                                     consent of the Required Lenders.

                                                                                     The amount included in the Borrowing Base
                                                                                     for Development Properties shall not exceed
                                                                                     25% of the total Borrowing Base.

                                                                                     The amount included in the Borrowing Base
                                                                                     for Completed Projects and Development
                                                                                     Properties shall not exceed 50% of the total
                                                                                     Borrowing Base.
-------------------------------------- -------------------------- ------------------ -----------------------------------------------
4.     Land Held for Investment        Net Book Value                   50%          The amount included in the Borrowing Base for
                                                                                     Land Held for Investment shall not exceed
                                                                                     the lesser of 15% of the total Borrowing
                                                                                     Base or $60,000,000.
-------------------------------------- -------------------------- ------------------ -----------------------------------------------
</TABLE>

                                  Schedule II-1
<PAGE>

<TABLE>
<CAPTION>
-------------------------------------- -------------------------- ------------------ -----------------------------------------------
      BORROWING BASE COMPONENT           ASSET VALUATION METHOD    ADVANCE FORMULA                     LIMITATIONS
-------------------------------------- -------------------------- ------------------ -----------------------------------------------
<S>    <C>                             <C>                              <C>          <C>
5.a.   Investment Securities rated     Average Market Price             75%          None
       BB or higher

   b.  Investment Securities rated     Average Market Price             70%          None
       BB- through B

   c.  Investment Securities rated     Average Market Price             60%          The amount included in the Borrowing Base for
       B- or lower                                                                   Investment Securities rated B- or lower shall
                                                                                     not exceed 25% of the total Borrowing Base.

                                                                                     The amount included in the Borrowing Base
                                                                                     for all Investment Securities shall not
                                                                                     exceed 35% of the total Borrowing Base.
-------------------------------------- -------------------------- ------------------ -----------------------------------------------
6.     Mortgage Loans                  Net Book Value                   75%          The amount included in the Borrowing Base for
                                                                                     Mortgage Loans shall not exceed 20% of the
                                                                                     total Borrowing Base.
-------------------------------------- -------------------------- ------------------ -----------------------------------------------
7.     Tax Credits                     See clause (xiii) of the         70%          The amount included in the Borrowing Base for
                                       definition of Borrowing                       Tax Credits shall not exceed 25% of the total
                                       Base                                          Borrowing Base.
-------------------------------------- -------------------------- ------------------ -----------------------------------------------
8.     Portfolio/Single Asset          Net Book Value                   37.5%        No new investment in Portfolio/Single Asset
       Partnerships                                                                  Partnerships involving in excess of $25,000,000
                                                                                     or involving an investment in a real
                                                                                     property related business shall be included
                                                                                     in the Borrowing Base without the prior
                                                                                     written consent of the Required Lenders.
-------------------------------------- -------------------------- ------------------ -----------------------------------------------
9.     Strategic Investments           Net Book Value                   50%          The amount included in the Borrowing Base for
                                                                                     mezzanine loans shall not exceed the lesser of
                                                                                     15% of the total Borrowing Base or $40,000,000.

                                                                                     No Strategic Investment involving greater
                                                                                     than $25,000,000 shall be included in the
                                                                                     Borrowing Base without the prior written
                                                                                     consent of the Required Lenders.
-------------------------------------- -------------------------- ------------------ -----------------------------------------------
</TABLE>

                                  Schedule II-2
<PAGE>

<TABLE>
<CAPTION>
-------------------------------------- -------------------------- ------------------ -----------------------------------------------
      BORROWING BASE COMPONENT           ASSET VALUATION METHOD    ADVANCE FORMULA                     LIMITATIONS
-------------------------------------- -------------------------- ------------------ -----------------------------------------------
<S>    <C>                             <C>                              <C>          <C>
10.    Land Partnerships               Net Book Value                    30%         The amount included in the Borrowing Base for
                                                                                     Land Partnerships shall not exceed 15% of the
                                                                                     total Borrowing Base.

                                                                                     The amount included in the Borrowing Base
                                                                                     for Strategic Investments, Land Partnerships
                                                                                     and Portfolio/Single Asset Partnerships
                                                                                     shall not exceed 50% of the total Borrowing
                                                                                     Base.

                                                                                     The amount included in the Borrowing Base
                                                                                     for Strategic Investments, Land Partnerships
                                                                                     and Portfolio/Single Asset Partnerships in
                                                                                     which Borrower and its Subsidiaries do not
                                                                                     have a "controlling interest" shall not
                                                                                     exceed the lesser of 25% of the total amount
                                                                                     included in the Borrowing Base for Strategic
                                                                                     Investments, Land Partnerships and
                                                                                     Portfolio/Single Asset Partnerships or
                                                                                     $30,000,000.
-------------------------------------- -------------------------- ------------------ -----------------------------------------------
</TABLE>

                                  Schedule II-3

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