Reference Materials - Sales Agreement Between Jim Lentz and Starwood Corp. (ie. Three E and SOF-Harmony Funding)

PURCHASE AND SALE AGREEMENT

(Partnership Interests in Birchwood Acres Limited Partnership, LLLP)

by and among

Three E Corporation and AJG Financial Services, Inc., Sellers

and

SOF-Harmony Funding, L.L.C., Purchaser

Dated as of March 22, 2005

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TABLE OF CONTENTS

1. Definitions. 2

2. Purchase and Sale. 2

3. A. Purchase Price; Cash Portion; Deferred Portion;
Downpayment; L/C;Guaranty. 3

B. Closing Adjustment. 5

4. Closing Date. 6

5. Seller's Representations and Warranties. 6

6. Representations and Warranties of Purchaser and Guarantor. 15

7. Filings Under the Hart Scott Rodino Act. 16

8. Indemnification, Limitations and Survival. 16

9. Violations. 20

10. Certain Books and Records. 21

11. Intentionally omitted. 21

12. Operation of the Business of the Company and the Company
Subsidiaries. 21

13. Deliveries by Seller at Closing. 21

14. Intentionally Omitted. 23

15. Deliveries by Purchaser at Closing. 23

16. Conditions to Closing Obligations. 24

17. Title. 26

18. Seller's Remedies. 28

19. Purchaser's Remedies. 28

20. Purchaser's Inspection; Due Diligence Period. 28

21. Indemnification Procedure. 31

22. Broker. 32

23. Casualty; Condemnation. 32

24. Escrow. 33

25. Additional Covenants. 34

26. Termination and Exclusivity. 36

27. Notices. 36

28. Miscellaneous. 39

29. Conveyance of Parcels to Harmony Institute. 41

30. Lentz Agreement. 43

31. Harmony Name and Mark. 43

32. Contingency. 43

33. Lentz Lot Purchase Agreement. 43

34. Confidentiality. 44

35. Purchaser's and Guarantor's Obligations to AJG Respecting
the Bond Indebtedness. 44

Exhibits

Exhibit A Description of Property (including Alligator Inn)
Exhibit B List of Personal Property

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Exhibit C Excluded Property
Exhibit D Deferred Payment Agreement
Exhibit E January Balance Sheet
Exhibit F None

Exhibit G Property Rent Roll
Exhibit H None

Exhibit I None

Exhibit J Lentz Employment Agreement

Schedules

Schedule 1 Definitions

Schedule 5(i) Pending Litigation
Schedule 5(ii) Environmental - Hazardous Materials
Schedule 5(v) Consents

Schedule 5(vi) Underlying Obligee Consents
Schedule 5(vii) Written Employment Agreements
Schedule 5(viii) Existing Leases and Pending Unit/Site Contracts
Schedule 5(ix) Exceptions to Lease/Sale Contract Reps
Schedule 5(ix)(3) Rent Concessions

Schedule 5(ix)(5) Tenant Actions Pending
Schedule 5(ix)(6) Security Deposits

Schedule 5(x) Pending Real Property Tax Reductions
Schedule 5(xi) Service Contracts

Schedule 5(xiv) Brokerage Agreements and Commissions
Schedule 5(xv) Claims and improvements in excess of $200,000
Schedule 5(xvii) Company's Casualty Insurance
Schedule 5(xviii) Underlying Obligations
Schedule 5(xix) Company Sponsored Benefit Plans
Schedule 5(xxi) Environmental Claims and Hazardous Materials
Schedule 5(xxiii(A) Tax Audits

Schedule 5(xxiii(B) Waiver or agreement re: Statute of Limitations
re: payment or collection of taxes

Schedule 5(xxiii(C) Tax Entity in Consolidated Returns
Schedule 5(xxiii(E) Claims received by Tax Entity
Schedule 5(xxv) Personal Property Leased by Company
Schedule 6(d) Federal, State or Local Consents or Waivers
needed

Schedule 20 Leases, Building Contracts Service Agreements,
Warranties, Underlying Obligations, and all
Permitted Encumbrances

Schedule 26(h) Employee "For Cause" Criteria
Schedule 29(a) Harmony Parcel Sketches

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PURCHASE AND SALE AGREEMENT

THIS PURCHASE AND SALE AGREEMENT (this "Agreement") dated as of March
22, 2005, by and among Three E Corporation ("Three E"), a Florida
corporation having offices at 3500 Harmony Square Drive West,
Harmony, Florida 34773, AJG Financial Services, Inc. ("AJG") a
Delaware corporation having offices at The Gallagher Centre, Two
Pierce Place, Itasca, Illinois 60143-3141 (Three E and AJG being
herein collectively referred to as the "Seller" and being severally,
and not jointly and severally liable for all obligations and
liabilities of Seller hereunder) and SOF-HARMONY FUNDING, L.L.C., a
Delaware limited liability company having offices c/o Starwood
Capital Group Global, L.L.C., 591 W. Putnam Avenue, Greenwich, CT
06830 ("Purchaser"); at Closing, Purchaser shall cause an entity
which is acceptable to Seller in its reasonable discretion and which
is affiliated with SOF - VI U.S. Holdings II, L.L.C., a Delaware
limited liability company, having offices at 591 W. Putnam Avenue,
Greenwich, CT 06830 or, pursuant to Section 3A(e) hereof, shall cause
another entity which is acceptable to Seller in its reasonable
discretion ("Guarantor") solely for the purposes specified in
Sections 3A(e), 6 and 35 below, to execute this Agreement and the
"Deferred Payment Agreements" referred to in such sections, in lieu
of Purchaser's providing the "Purchaser's Letter of Credit" or other
security at "Closing" (as such terms are hereinafter defined) in
accordance with the terms hereof. The term "Purchaser" as used herein
shall also refer to and include all "Purchaser Designees"
(hereinafter defined).

Each "Company Subsidiary" and the "Three E Parent" (hereinafter
defined) executes this Agreement to acknowledge its agreement to
abide by those terms hereof and perform and cause the performance of
those obligations of Seller set forth herein which relate to such
person or entity and its assets and activities. The "Company"
(hereinafter defined) executes this Agreement to acknowledge its
agreement to abide by and perform its obligations set forth herein
prior to Closing. Each of Seller, Purchaser and Guarantor are
sometimes herein referred to as a "Party" and they are sometimes
herein referred to collectively as the "Parties".

W I T N E S S E T H:

WHEREAS, Sellers collectively own all of the partnership interests
(the "Partnership Interests") in Birchwood Acres Limited Partnership,
LLLP, a Florida limited liability limited partnership (the "Company"
having offices at 3500 Harmony Square Drive West, Harmony, Florida
34773, and

WHEREAS, AJG is the sole limited partner of the Company, and Three E
is the sole general partner of the Company, and

WHEREAS, James Lentz, ("Lentz") an individual is a majority and
controlling shareholder of Three E, and Harmony Institute ("Harmony
Institute"), an eleemosynary organization is a minority and
non-controlling shareholder of Three E (Lentz is herein sometimes
referred to as the "Three E Parent"); and

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WHEREAS, the Company owns and holds in its own name, record title to
a tract which originally consisted of approximately 11,030 acres
(excluding certain parcels which were sold and conveyed to parties
unrelated to Seller on or prior to the Closing Date, which is more
particularly described on Exhibit A hereto; and

WHEREAS, the Company owns all of the interests in, and controls each
of, Harmony Development Co, LLC, a Florida limited liability company,
Harmony Golf Facilities, LLC, a Florida limited liability company,
Harmony Restaurant Facilities, LLC, a Florida limited liability
company Harmony Ground Maintenance Co. LLC, a Florida limited
liability company and Harmony Real Estate Co., LLC, a Florida limited
liability company (each, a "Company Subsidiary" or "Subsidiary" and
collectively, the "Company Subsidiaries" or "Subsidiaries"), each of
which provides certain services and conducts certain operations at
the Property and holds certain related permits, licenses, contract
rights and other property; and

WHEREAS, the term "Property", as used herein, includes, in addition
to all other property and rights to be owned by the Company on the
Closing Date as hereinafter set forth, the land described on Exhibit
A together with all appurtenances and rights benefiting and running
with same (the "Land"), together with the buildings and other
improvements thereon (each a "Building" or "Improvement", and
collectively, the "Buildings and Improvements"), all personal
property, equipment and other tangible property owned by the Company
and the Company Subsidiaries on the date hereof, of which Seller
shall provide a list designated as excluded property to Purchaser
within five (5) Business Days after the date hereof, which list shall
then be attached hereto as, and which is herein referred to as,
Exhibit B hereto and such property is collectively herein referred to
as the "Personal Property") and all Leases but excluding any property
of which Seller shall provide a list designated as excluded property
to Purchaser within five (5) Business Days after the date hereof,
which shall then be attached hereto as, and which list is herein
referred to as, Exhibit C and which property is collectively herein
referred to as "Excluded Property", and

WHEREAS, each of Three E and AJG desires to sell that portion of the
Partnership Interests owned by such party, and the Purchaser desires
to purchase the Partnership Interests pursuant to the terms hereof.

NOW, THEREFORE, in consideration of the recitals, and other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree to the foregoing
and the following:

1. Definitions. Those capitalized terms which are used in this
Agreement but which are not defined in the body of this Agreement
(including the recitals set forth above), shall have the meanings
specified in Schedule 1 attached hereto.

2. Purchase and Sale. Each of Three E and AJG agrees to sell, assign
and transfer that portion of the Partnership Interests owned by such
party to Purchaser, and Purchaser agrees to purchase the same from
each of Three E and AJG, respectively, for the price and subject to
the terms of this Agreement.

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3. A. Purchase Price; Cash Portion; Deferred Portion; Downpayment;
L/C; Guaranty.

(a) The aggregate purchase price to be paid by Purchaser to Seller
for the Partnership Interests (the "Purchase Price"), shall consist
of the aggregate of the sums specified in Section 3(b) below which
shall be payable in cash at Closing (the "Cash Portion") and the sums
specified in Section 3(c) below which shall be deferred and payable
after Closing (the "Deferred Portion"). The Cash Portion payable to
each of Three E and AJG (as set forth in Section 3(c) below) shall be
paid to each of Three E and AJG, respectively, by bank wire transfer
on the Closing Date (as hereinafter defined) in immediately available
federal funds to the account of the respective receiving party
specified by such party prior to the Closing Date. Simultaneously
with the making of such payment, the Escrow Agent shall be directed
by the Parties to return the "Downpayment" (hereinafter defined) to
Purchaser. The portion of the Purchase Price which is tentatively
allocated to each particular tract within the Property shall be
specified in an amendment to Exhibit A which Seller and Purchaser
shall reasonably agree to between the date hereof and the Closing
Date. Subject to the following sentence, each of Seller and Purchaser
shall utilize and apply such allocation for all purposes and shall
not take a position to the contrary, including without limitation, in
any documents or filings. Pursuant to § 1060 of the Code, within 30
days after the Closing Date, the Seller and Purchaser shall adjust
such allocations if necessary to reflect any change between the date
of such initial allocation and the Closing Date.

(b) The Cash Portion shall consist of the following sums:

(i) Three Million Seven Hundred Fifty Thousand Dollars ($3,750,000)
which Purchaser shall pay to Three E or as directed by Three E; and

(ii) The sum, which Purchaser shall pay to AJG or as directed by AJG,
of Seventy Five Million Dollars ($75,000,000), reduced by the
aggregate unpaid principal amount of the following bank or
institutional funded indebtedness of the Company outstanding
immediately prior to the Closing on the Closing Date: (A) the
$12,410,000 Birchwood Acres Limited Partnership Taxable Variable Rate
Bonds (Birchwood Triple E Ranch Project), Series 2000, the entire
indebtedness evidenced by such bonds being hereinafter referred to as
the "Bond Indebtedness"; (B) the First National equipment credit
line; (C) the Franklin Bank debt; and (D) the MuniMae debt; it is
understood and agreed that the indebtedness of the Company to each of
AJG and Harris Bank shall be paid in full by (Seller's utilizing
funds from the Purchase Price) at Closing immediately prior to
Purchaser's acquisition of the Partnership Interests and that
Purchaser shall take subject to the other obligations of the Company
which are set forth on the January Balance Sheet (as hereinafter
defined), without a credit against the Purchase Price in respect of
such other obligations which are set forth on the January Balance
Sheet (and Purchaser shall bear without a credit against the Purchase
Price therefore, any additional obligations of the Company which are
shown on the Closing Date Balance Sheet (as hereinafter defined)
which are not "Material Variances", as hereinafter defined in Section
3B(a)); the foregoing obligations

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which Purchaser shall take subject to are herein referred to as the
"Assumed Indebtedness"; for the avoidance of doubt, the Purchaser
shall not receive a credit against or a reduction of the Purchase
Price in respect of the payment which the Company is obligated to
make after May 1, 2005 pursuant to the special assessments required
by Harmony CDD for payment of semi-annual principal and interest due
on the $17,700,000 Harmony Community Development District Bonds
(Series 2001); and

(iii) The aggregate amount of Six Hundred and Fifty Thousand Dollars
($650,000) for the acquisition of the Alligator Lakeside Inn assets,
property or equity interests. The closing costs of such acquisition
shall be borne by the Partnership. Any payment due under this Section
3A(b)(iii) shall be made solely to AJG to the extent that such
acquisition shall have increased the Partnership's indebtedness for
which Purchaser shall receive a credit pursuant to clause (ii) above.

(c) The Deferred Portion shall consist of those sums, if any, payable
by Purchaser to Three E or as directed by Three E pursuant to a
"Deferred Payment Agreement" which Purchaser and Three E (and such
other party or parties as may be set forth as signatories in such
form) shall execute and deliver to each other at Closing, in the form
attached hereto as Exhibit D (the "Deferred Payment Agreement").

(d) (i) On the date hereof, Purchaser has delivered to First American
Title Insurance Company, as escrow agent (the "Escrow Agent") the
cash in the amount of Two Million Dollars ($2,000,000) (which
together with any interest earned thereon after the date hereof is
defined as the "Downpayment"). The Escrow Agent shall invest the
Downpayment in a money market fund or a demand deposit interest
bearing bank account in the name of Escrow Agent at a financial
institution. The Downpayment shall be held in escrow by the Escrow
Agent and dealt with in accordance with the provisions hereof.

(ii) Anything to the contrary herein notwithstanding and subject to
offset for any payment required to be made by Purchaser pursuant to
Sections 20(a)(iv) and 20(d) below, (x) if Purchaser shall timely
give a termination notice pursuant to the provisions of Section
20(c), the Escrow Agent shall promptly remit $250,000 of the
Downpayment to Seller and shall promptly remit the remainder of the
Downpayment to Purchaser (subject to the other express provisions
hereof); provided, however, that if Seller shall have breached its
obligations hereunder during the Due Diligence Period, and Purchaser
shall have given Seller written notice thereof (setting forth a
detailed description of the alleged breach) at least three (3)
Business Days prior to expiration of the Due Diligence Period and
such breach shall not be cured by Seller or waived in writing by
Purchaser within ten (10) Business Days after receipt of such notice,
but not later than two (2) Business Days prior to the end of the Due
Diligence Period, then the Escrow Agent shall promptly remit the
entire Downpayment to Purchaser; and (y) if Purchaser shall not have
timely given a termination notice pursuant to the provisions of
Section 20(c) and if Closing shall not thereafter occur for any
reason other than Seller's breach hereunder, then Seller shall be
entitled to receive the entire Downpayment and same shall not be
refundable to Purchaser.

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(e) Purchaser shall at Closing cause Guarantor to do each of the
items (i) through (iv) below or else shall provide the alternative
guaranty or other security described in the sentence following this
sentence: (i) to execute and deliver to Three E and Lentz the
Deferred Payment Agreement; and (ii) to execute and deliver to AJG an
agreement pursuant to which Purchaser shall pay to AJG one percent
(1%) of the net cash flow of the Company on terms substantially
identical to those contained in the Deferred Payment Agreement
(except that such agreement shall not contain provisions similar to
Sections 3.3 or 3.4 or Articles IV and V of the Deferred Payment
Agreement); the agreements referred to in these clauses (i) and (ii)
are herein collectively referred to as the "Deferred Payment
Agreements"; and (iii) to execute and deliver a copy of this
Agreement to AJG to evidence its obligation to AJG pursuant to
Section 35 below; and (iv) to execute and deliver a copy of this
Agreement to AJG and Three E to evidence its obligation to indemnify,
defend and hold harmless each of the Seller Indemnified Parties (as
hereinafter defined) from and against any and all Damages (as
hereinafter defined) relating to, arising from or in connection with
any breach of representation, warranty, covenant or agreement by
Guarantor hereunder. In lieu of causing items (i) through (iv) above
to occur, Purchaser may elect to provide at Closing: (x) an
irrevocable and evergreen, clean standby letter of credit in the face
amount of $12,600,000 (the "Purchaser's Letter of Credit") in form
and substance reasonably acceptable to AJG and issued by an issuer
which is reasonably acceptable to AJG, which Purchaser's Letter of
Credit shall be accepted by AJG as security in lieu of the
obligations of Guarantor under Section 35(c), (d) and (e); and (y) a
guaranty or other security reasonably satisfactory to Three E and
AJG, in lieu of the obligations of Guarantor pursuant to clauses (i),
(ii) and (iv) of this subsection (e). If security in a form other
than a guaranty is provided for all of the obligations referred to in
items (i) through (iv) of the preceding sentence, then references to
"Guarantor" in this Agreement shall be deemed deleted and of no force
or effect and references to "Starwood" in the form of Deferred
Payment Agreement attached hereto as Exhibit D shall be deemed
deleted and of no force or effect except that in Article V thereof
(entitled "Future Opportunities"), the term "Starwood" shall be
deemed to mean "Purchaser". In the event that Purchaser shall at
Closing, initially provide the Purchaser's Letter of Credit and any
other form of security than the guaranty referred to in clauses (i)
through (iv) above, it may nevertheless, at any time thereafter
replace such security by the guaranty referred to in clauses (i)
through (iv) above, whereupon the changes effected by the preceding
sentence shall be deemed reversed.

B. Closing Adjustment. (f) The Purchase Price shall not be adjusted
in any manner unless the Closing Date Balance Sheet reflects material
and adverse variances in liabilities from the balance sheet of the
Company as at January 31, 2005 (the "January Balance Sheet") which
variances are caused by transactions by the Company outside of the
customary and usual course of business consistent with past practices
(the "Material Variances"). Seller shall prepare a balance sheet of
the Company as at the Closing Date (the "Closing Date Balance Sheet")
in the same format and utilizing the same methods, procedures and
assumptions that were used in the preparation of the January Balance
Sheet and shall deliver a copy of the Closing Date Balance Sheet to
Purchaser within thirty (30) days after the Closing Date. A copy of
the January Balance Sheet is attached hereto as Exhibit E.

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(g) In the event the Closing Date Balance Sheet shall reflect
Material Variances then, within ten (10) Business Days after the last
of AJG and Three E to receive notice thereof from Purchaser,
Purchaser, AJG and Three E shall confer for purposes of determining
the effect, if any, such Material Variances shall have upon the
Purchase Price. In the event the Parties shall be unable to resolve
any dispute regarding Material Variances within thirty (30) days
after the first conference of the Parties with respect thereto, then
such dispute shall be submitted by any party to any of the following
firms selected by Purchaser (provided that Purchaser may not select
any firm which has provided services to, or otherwise had a
relationship with, Purchaser or any of its Affiliates within the
prior twelve (12) month period): BDO Seidman, Price Waterhouse
Coopers, KPMG or Moore Stephens Lovelace, P.A., certified public
accountants which are located at 1201 S. Orlando Avenue, Suite 400,
Winter Park, FL 32789-7192 (the "Arbitrator"), as soon as possible
and the decision of the Arbitrator shall be final and binding upon
the parties without further recourse. If Purchaser shall fail to
select an arbitrator in a writing delivered to Seller within ten (10)
Business Days after the expiration of the aforesaid thirty (30) day
period, then the arbitrator shall be Moore Stephens Lovelace, PA. In
the event the Arbitrator shall determine that the Purchase Price
shall be reduced as a result of Material Variances at the Closing
Date, such reduction shall not exceed the aggregate increase in the
book value of the assets of the Company and the Company Subsidiaries
between January 31, 2005 and the Closing Date. The fees and costs of
the Arbitrator will be borne equally by Purchaser and Seller (one
half each).

4. Closing Date. The consummation of the transactions contemplated by
this Agreement (the "Closing") shall take place at the offices of
Baker & Hostetler, 200 South Orange Avenue, Orlando, Florida, or at
such other location as may be agreed upon by the Parties, at 10:00AM
E.S.T. on April 20, 2005, or on such earlier or later date pursuant
to Section 17(a) below, or otherwise as Seller and Purchaser may
hereafter mutually agree upon (the actual date on which the Closing
occurs is herein sometimes referred to as the "Closing Date").

5. Seller's Representations and Warranties. Seller represents and
warrants to Purchaser that the statements set forth in the recitals
of this Agreement and the following are true, correct and accurate in
all material respects:

(i) Except as set forth on Schedule 5(i), there is no litigation,
dispute or proceeding before any federal, state or municipal
department, board, bureau, agency or instrumentality pending, or to
Seller's Knowledge, threatened, against or relating to (X) Seller,
the Company, the Company Subsidiaries or the Property; or (Y) the
Seller Parents, if in the case of this clause (Y), it is likely to
have a material adverse effect on Seller's ability to perform its
obligations hereunder or upon the Company after the Closing.

(ii) Except as is set forth on Schedule 5(ii) or as is reflected in
any report identified on Schedule 5(ii) Seller has no Knowledge that
there are Hazardous Materials

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at the Property, or that Hazardous Materials from the Property have
been placed on, or have migrated to adjoining property or, that
except as set forth on Schedule 5(ii), Seller has received any
citations, summonses, directives or orders relating to Hazardous
Materials in or about the Property which are pending or unresolved at
the date hereof or which were resolved within the past three years.

(iii) The execution, delivery and performance of this Agreement by
Three E (as to itself) and AJG (as to itself) has been duly
authorized by all requisite action of such party and this Agreement
is the valid and binding obligation of Three E (as to itself) and AJG
(as to itself) enforceable against such party in accordance with its
terms except to the extent that enforcement may be affected by laws
relating to bankruptcy, reorganization, insolvency and creditors
rights and by the availability of injunctive relief, specific
performance and other equitable remedies.

(iv) Each of the Company and Three E (as to itself) and AJG (as to
itself) is a valid and existing entity of the type specified
elsewhere herein, organized under the laws of the jurisdiction
specified elsewhere herein and has the requisite power and authority
to enter into and to perform the terms of this Agreement; Three E (as
to itself) and AJG (as to itself) is the lawful owner, both
beneficially and of record, of all of the partnership interests in
the Company reflected on the books and records of the Company as
owned by such party (each of Three E and AJG represents that such
partnership interests together constitute all of the partnership
interests in the Company, the "Partnership Interests") free and clear
of liens and encumbrances, the delivery to Purchaser of the
Assignment of Partnership Interests by Three E (as to itself) and AJG
(as to itself) pursuant to this Agreement will transfer to Purchaser
good, valid and marketable title to the portion of the Partnership
Interests owned by Three E and AJG respectively, free and clear of
all liens, encumbrances and claims of others. The Company owns no
equity interest or other ownership interest in any entity other than
the Company Subsidiaries.

(v) No consents, approvals, orders or authorizations of any federal,
state or local governmental commission, board, agency, authority or
other regulatory body are required for Three E's (as to itself) or
AJG's (as to itself) execution, delivery and performance of this
Agreement except as set forth on Schedule 5(v).

(vi) Except as set forth on Schedule 5(vi), no consent of any
mortgagee, Underlying Obligee or any other third party is required
for or in connection with the execution, delivery or performance by
the Seller and the Company of this Agreement or for or in connection
with its consummation of the transactions contemplated hereby.

(vii) There are no employees (including without limitation, employees
of Seller, the Company or the Company Subsidiaries) except for those
set forth on Schedule 5(vii) who have written employment agreements
with the Company or any Company Subsidiary providing for employment
beyond the Closing Date.

(viii) Schedule 5(viii) (referred to in this Section 5(viii) as the
"Schedule") lists all existing material (A) leases and amendments,
renewals and guaranties thereof which

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are in effect for the lease of space in or at the Buildings and
Improvements or otherwise at the Property (whether or not the terms
thereof have commenced) under which the Company is the landlord
(collectively, together with any "New Leases", hereinafter defined,
the "Leases"); tenants under Leases are herein referred to as
"Tenants" and (B) contracts (and all deposits thereunder and
guarantees thereof) ("Pending Unit/Site Contracts") under which title
closing has not as of the date hereof, occurred, for the sale of
homes and/or home sites by Seller to purchasers (the "Pending
Unit/Site Purchasers). The Pending Unit/Site Contracts are together
with any "New Contracts", hereinafter defined, referred to as the
"Sale Contracts". Except as set forth on the Schedule, there are no
Sale Contracts (or other contracts for sale of lots at or about the
Property) at or for the Property to which Company Affiliates or
Seller Affiliates (as distinct from the Company itself are a party).
No person or entity has or to Seller's Knowledge claims any right
pursuant to any written agreement with the Company (or to which the
Company is bound) to purchase, occupy or otherwise utilize the
Property or any part thereof (other than access rights for ingress,
egress and utilities which are set forth of record in plats filed in
the appropriate land records office or in recorded deeds except as
shown on the Schedule, and the Company has made available to
Purchaser true and complete copies of all of the existing Leases and
Sale Contracts. Seller has also set forth on the Schedule all of the
subleases under any of the Leases and all assignments of the Sale
Contracts by contract vendees, to which the Company has consented or
of which Seller has Knowledge. Other than the Leases and Sale
Contracts listed on the Schedule (and the rights referred to in the
parenthetical clause in the preceding sentence), there are no
agreements in force or effect for the use, lease or occupancy of
space at the Property or the purchase of homes, home sites or other
property to which the Company is a party or by which the Company is
bound as landlord or of which Seller or the Company has Knowledge.

(ix) Except to the extent set forth in Schedule 5(ix) (or in other
schedules referred to in particular sub-subsections below in this
Section 5(ix)):

(1) each of the Leases and Pending Unit/Site Contracts is in full
force and effect; the Company is not in material default of any of
its obligations under any Lease or any Sale Contract; no Tenant or
Pending Unit/Site Purchaser is in arrears or in default (after any
applicable notice and/or grace period) in the payment of fixed rent
or "Additional Rents" (defined below) or the contract deposit or
purchase price, as applicable or to the Knowledge of Seller is in
material default of its non-monetary obligations after any applicable
notice or grace period under its Lease or Sale Contract.

(2) except as may be set forth in the Leases or Pending Unit/Site
Contracts, in this Agreement or in any exhibit or schedule hereto or
as is otherwise granted by the Company in the ordinary course of
business, no Tenant or Pending Unit/Site Purchaser is entitled to and
to the Knowledge of Seller none has asserted any right to any rent
concession or purchase price concession, rebate, abatement,
improvement allowance, work or other benefits;

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(3) except as set forth on Schedule 5(ix)(3), neither Seller nor the
Company has received written notice from a Tenant or a Pending
Unit/Site Purchaser claiming or asserting any defenses,
counterclaims, set-offs or offsets against the rents specified in its
Lease or against its obligations under its Sale Contract;

(4) except as provided in the Leases or Pending Unit/Site Contracts,
no renewal, extension, expansion or purchase rights or options have
been granted and remain outstanding in favor of any Tenant or any
Pending Unit/Site Purchaser;

(5) except as set forth in Schedule 5(ix)(5),no action or proceeding
is pending, or to Seller's or the Company's knowledge, threatened,
against Seller or the Company by any Tenant or any Pending Unit/Site
Purchaser;

(6) except as set forth in Schedule 5(ix)(6), there are no security
deposits under the Leases or Sale Contracts; and

(7) no Tenant has prepaid any fixed rent or Additional Rents for more
than one month in advance.

(x) Except as set forth on Schedule 5(x), neither the Company nor
Seller has received written notice of any pending real property tax
reduction proceedings with respect to the Property.

(xi) Schedule 5(xi) (which shall be prepared by Seller and delivered
to Purchaser within five (5) Business Days after the date hereof and
shall then be attached hereto) is a true and complete list of all
material (other than brokerage agreements, which are addressed in
Section 5(xiv) below) service, maintenance, utilities, supply and
other contracts relating to the Property, or by which the Company is
bound, or affecting the Property or the use thereof, together, in
each case, with all amendments and modifications thereof to which the
Company is a party (collectively, the "Service Contracts"); a true
and complete copy of each Service Contract has been made available to
Purchaser.

(xii) Neither the Company nor Seller is a "foreign person" within the
meaning of

Section 1445 of the Internal Revenue Code 1986, as amended, or any
regulations promulgated thereunder (collectively, the "Code").

(xiii) Except for Permitted Exceptions, there are no court (or other
governmental entity) judgments, orders, or decrees of any kind
against the Company or Seller which are unpaid or unsatisfied of
record, nor any actions, suits or other legal or governmental
administrative proceedings pending or, to the best of the Company's
or Seller's knowledge, threatened against the Company or Seller,
which is likely to have any material adverse effect on the Company or
the ability of the Company or Seller to consummate the transactions
contemplated by this Agreement.

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(xiv) Except as set forth on Schedule 5(xiv) (brokerage commissions
set forth thereon, if any, are referred to herein as the "Payable
Commissions") there are no brokerage commissions (or unpaid
installments thereof) with respect to any Leases or Sale Contracts
which are now due and payable or which will become due and payable
hereafter (including after the Closing), other than with respect to
transactions consummated on or subsequent to December 31, 2004 for
which proceeds have either remained with the Company, reduced
indebtedness of the Company or otherwise have been utilized in
connection with the conduct of the Company's business in the ordinary
course of business. Schedule 5(xiv) lists all of the leasing and/or
sales brokerage agreements (the "Leasing/Sales Brokerage Agreements")
which are presently in effect relating to the Property and binding on
the Company, any Company Subsidiary, Seller or any Affiliate of
Seller; true and complete copies thereof have been made available to
Purchaser.

(xv) Except as set forth on Schedule 5(xv) and except for any
improvement work or allowance or reimbursement in respect thereof to
which a Tenant or a Pending Unit/Site Purchaser may be entitled in
accordance with the terms of any presently unexercised renewal,
extension, expansion or other options expressly set forth in any
Leases or Pending Unit/Site Contracts and except for developer
liability imposed by Florida law (Seller hereby represents that it
has received no written notices of any such claims) and warranty
obligations incurred in the ordinary course of the Company's
business, there is no improvement work required to be performed by
the Company under any Lease or Sale Contract or for which the Company
is required under any Lease or Sale Contract to reimburse any Tenant
or Pending Unit/Site Purchaser or grant any allowance in favor of any
Tenant or Pending Unit/Site Purchaser, in excess of Two Hundred
Thousand Dollars ($200,000) in the aggregate as to all such required
work which has not already been completed and/or the costs of which
(the "Inducement Costs") have not already been paid or allowed as a
credit to the Tenant or the Pending Unit/Site Purchaser.

(xvi) Neither Seller, the Company, any Company Subsidiary nor, to
Seller's Knowledge, any Tenant or Pending Unit/Site Purchaser is
presently the subject of any of the following: a petition under any
federal or state bankruptcy or insolvency laws, the appointment of a
receiver to take possession of all or substantially all of its
assets, the attachment or other judicial seizure of all or
substantially all of its assets, an admission in writing of its
inability to pay its debts as they come due, or an offer of
settlement, extension or composition made to its creditors generally.

(xvii) Attached hereto as Schedule 5(xvii) is a list of all property
casualty insurance coverages, including fire and extended coverage,
maintained by the Company with respect to the Property ("Company's
Casualty Insurance"). The Company's Casualty Insurance is in full
force and effect.

(xviii) Seller has made available to Purchaser a true, correct and
complete copy of each of the agreements and documents which
constitute the Underlying Obligations, all of which Underlying
Obligations are generally described on Schedule 5(xviii). The
Underlying Obligations have not been amended. All payments due and
payable by the

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Company under the Underlying Obligations to and including the date of
this Agreement have been made. The Company has not given or received
written notice of any default under any of the Underlying Obligations
which is outstanding and not remedied.

(xix) Schedule 5(xix) contains a complete list of each Benefit Plan.
The Company has made available to Purchaser true and complete copies
of each Benefit Plan and with respect to any Benefit Plan that is
sponsored or maintained by the Company or any Company Subsidiary (a
"Company Sponsored Benefit Plan") all contracts relating thereto, or
to the funding thereof, including, without limitation, all trust
agreements, insurance contracts, administration contracts, investment
management agreements, subscription and participation agreements and
recordkeeping agreements. In the case of any Company Sponsored
Benefit Plan that is not in written form, the Purchaser has been
supplied with an accurate written description of such Company
Sponsored Benefit plan. A true and correct copy of the most recent
annual report, actuarial report, accountant's opinion of the plan's
financial statements, summary plan description and Internal Revenue
Service determination letter with respect to each Company Sponsored
Benefit Plan, to the extent applicable, has been made available to
the Purchaser, and there have been no materially adverse changes in
the financial condition in the respective plans from that stated in
the annual reports and actuarial reports supplied.

Except as disclosed on Schedule 5(xix)(1):

(a) All Benefit Plans have been maintained and administered in form
and in operation in all material respects in accordance with their
terms and with all applicable requirements of law (including, in the
case of any Benefit Plan which is an employee pension benefit plan,
the requirements of sections 401(a) and 501(a) of the Code), except
for any instances of failure to so maintain or administer that would
not, individually or in the aggregate, result in a material liability
of the Company or any Company Subsidiary and no notice issued by any
governmental authority questioning or challenging such compliance has
been received by the Company or any Company Subsidiary.

(b) None of the assets of any Benefit Plan are invested in employer
securities or employer real property.

(c) There have been no "prohibited transactions" (as described in
section 406 of ERISA or section 4975 of the Code) with respect to any
Benefit Plan and neither the Company nor any Company Subsidiary has
engaged in any prohibited transaction.

(d) There are no audits, examinations, investigations, actions, suits
or claims (other than routine claims for benefits) pending with
respect to which Seller or the Company has been served with process
or received written notice of the pendency thereof or, to Sellers'
Knowledge, threatened involving any Benefit Plan or the assets
thereof.

(e) Neither the Company nor any Company Subsidiary has any liability
or contingent liability for providing, under any Benefit Plan or
otherwise, any post-retirement medical or life insurance benefits,
other than statutory liability for providing group health plan
continuation coverage under Part 6 of Title I of ERISA and section
4980B of the Code or applicable state law.

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(f) There has been no act or omission that would impair the ability
of the Company (or any successor thereto) or any Company Subsidiary
(or any successor thereto) to unilaterally amend or terminate any
Benefit Plan.

(g) Neither the Company nor any Company Subsidiary, nor any employer
(whether or not incorporated) that would be treated together with the
Company, any Company Subsidiary and/or the Seller, as a single
employer within the meaning of Section 414 of the Code, sponsors,
maintains or contributes to, has sponsored, maintained or contributed
to, or has any liability, contingent or otherwise, with respect to a
plan covered by Title IV or Section 302 of ERISA or Section 412 of
the Code or a "multiemployer plan", as such term is defined in
Section 3(37) of ERISA.

(h) The execution of this Agreement and the consummation of the
transactions contemplated hereby do not constitute a triggering event
under any Benefit Plan, policy, arrangement, statement, commitment or
agreement, which (either alone or upon the occurrence of any
additional or subsequent event) will or may result in any payment,
"parachute payment" (as such term is defined in Section 280G of the
Code), severance, bonus, retirement or job security or similar-type
benefit, or increase any benefits or accelerate the payment or
vesting of any benefits to any employee or former employee or
director of the Company or any Company Subsidiary.

(xx) neither Three E (as to itself and its Affiliates), AJG (as to
itself and its Affiliates), the Company, any Company Subsidiary nor
any of their respective Affiliates, nor any of their respective
members, and none of their respective officers or directors is, nor
prior to Closing or the earlier termination of this Agreement, will
they become, a person or entity with whom U.S. persons or entities
are restricted from doing business under regulations of the Office of
Foreign Asset Control ("OFAC") of the Department of the Treasury
(including those named on OFAC's Specially Designated Blocked Persons
List) or under any U.S. statute, executive order (including the
September 24, 2001, Executive Order Blocking Property and Prohibiting
Transactions with Persons Who Commit, Threaten to Commit or Support
Terrorism) or other governmental action and, with respect to the
Company, any Company Subsidiary or any of their Affiliates, is not
and prior to Closing for the earlier termination of this Agreement
will not engage in any dealings or transactions with or be otherwise
associated with such persons or entities.

(xxi) for purposes of this Agreement, "Environmental Law" shall mean
any law, order or other requirement of law, including any principle
of common law, relating to the protection of human health or the
environment, or to the manufacture, use, transport, treatment,
storage, disposal, release or threatened release of Hazardous
Materials. Except as set forth on Schedule 5(xxi) or in any of the
reports identified on Schedule 5(xxi) Seller has no Knowledge that
(i) the Company or any of the Company Subsidiaries (x) is not in
material compliance with all applicable Environmental Laws, or (y)
has failed to obtain, or is not in material compliance with, any
Permits required of them under

12

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applicable Environmental Laws; (ii) there are any claims,
proceedings, investigations or actions by any Governmental or
Regulatory Authority or other Person or entity pending or threatened
against the Company or any of the Company Subsidiaries under any
Environmental Law; (iii) Hazardous Materials are, or have been,
located on (except in small amounts used in the ordinary course for
the operation or maintenance of the Property by the Company or its
predecessor in accordance with all applicable Environmental Laws), in
or under the Property or have been released into the environment, or
discharged, placed or disposed of at, on or under the Property; (iv)
underground storage tanks are, or have been, located at the Property;
or (v) the Property has been used to store, treat or dispose of
Hazardous Materials.

(xxii) Each of the Company and the Company Subsidiaries (each is
referred to as a "Tax Entity" in Sections 5(xxii), (xxiii) and
(xxiv)) has timely filed or caused to be timely filed with the
appropriate taxing authorities all material tax returns, statements,
forms and reports (including, elections, declarations, disclosures,
schedules, estimates and informational tax returns) for Taxes
("Returns") that are required to be filed by, or with respect to,
such Tax Entity on or prior to the Closing Date. The Returns have
accurately reflected and will accurately reflect all material
liability for Taxes of, or with respect to, such Tax Entity for the
periods covered thereby.

All material Taxes and Tax liabilities of each Tax Entity for all
taxable years or period that end on or before the Closing Date
("Pre-Closing Periods") have been or will be timely paid in full
within the period (or any extension thereof) prescribed under
applicable laws and regulations other than Taxes and Tax liabilities
that are being contested in good faith.

(xxiii)

A. Except as set forth on Schedule 5(xxiii)A, no Tax Entity has been
the subject of an audit or other examination of Taxes by the tax
authorities of any nation, state or locality (and no such audit is
pending or, to the Knowledge of Seller, contemplated) nor has any Tax
Entity received any notices from any taxing authority relating to any
issue which could reasonably be expected to materially and adversely
affect the Tax liability of the Company or any of its Subsidiaries.

B. Except as set forth on Schedule 5(xxiii)B, neither the Company nor
any of the Company Subsidiaries has, as of the Closing Date, (A)
entered into an agreement or waiver or requested to enter into an
agreement or waiver extending any statute of limitations relating to
the payment or collection of Taxes of such Tax Entity or (B) is
presently contesting the Tax liability of such Tax Entity before any
court, tribunal or agency.

C. Except as set forth on Schedule 5(xxiii)C, no Tax Entity has been
included in any "consolidated," "unitary" or "combined" Return
provided for under the law of the United States, any non-U.S.
jurisdiction or any state, province, prefect or locality with respect
to Taxes for any taxable period for which the statute of limitations
has not expired.

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D. All Taxes which the Company or any of the Subsidiaries is (or was)
required by law to withhold or collect in connection with amounts
paid or owing to any employee, independent contractor, creditor,
stockholder or other third party have been duly withheld or
collected, and have been timely paid over to the proper authorities
to the extent due and payable.

E. Except as set forth on Schedule 5(xiii)E, no written claim has
ever been received by a Tax Entity from any taxing authority in a
jurisdiction where the Company or any of the Company Subsidiaries
does not file Returns that the Company or any of its Company
Subsidiaries is or may by subject to taxation by that jurisdiction.

F. There are no tax sharing, allocation, indemnification or similar
agreements in effect as between the Company or any predecessor or
Affiliate thereof and any other party (including Seller and any
predecessors or Affiliates thereof) under which Purchaser or the
Company could be liable for any Taxes or other claims of any party.

G. Neither the Company nor any of the Company Subsidiaries has
applied for, been granted, or agreed to any accounting method change
for which it will be required to take into account any adjustment
under Section 481 of the Code or any similar provision of the Code or
the corresponding tax laws of any nation, state, province, prefect or
locality.

H. Neither the Company nor any of the Subsidiaries is a party to any
agreement that would require it to make any payment that would
constitute an "excess parachute payment" for purposes of Sections
280G and 4999 of the Code.

For purposes of this Agreement, "Taxes" shall mean all taxes,
assessments, charges, duties, fees, levies or other governmental
charges, including all U.S. and non-U.S. federal, state, local and
other income, franchise, profits, capital gains, capital stock,
transfer, sales, use, occupation, property, excise, severance,
windfall profits, stamp, license, payroll, withholding and other
taxes, assessments, charges, duties, fees, levies or other
governmental charges of any kind whatsoever (whether payable directly
or by withholding and whether or not requiring the filing of a Return
(as defined below)), all estimated taxes, deficiency assessments,
additions to tax, penalties and interest and shall include any
liability for such amounts as a result either of being a member of a
combined, consolidated, unitary or affiliated group or of a
contractual obligation to indemnify any Person or other entity.

(xxiv) The Company has no liabilities of any nature, matured or
unmatured, fixed or contingent, known or unknown, (x) which are
required to be disclosed on the 2004 Balance Sheet, in accordance
with GAAP, which have not been so disclosed, and (y) other than
liabilities incurred or arising in the normal course of business,
consistent with past practices, since December 31, 2004.

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(xxv) Except for personal property listed in Schedule 5(xxv) (which
shall be prepared by Seller and delivered to Purchaser within five
(5) Business Days after the date hereof and shall be attached hereto)
leased by the Company or any of the Company Subsidiaries the Company
and the Company Subsidiaries own all rights and personal property
which are necessary for the continued use of the Property after the
Closing Date in a manner which is consistent with the use of the
Property immediately prior to the date hereof.

6. Representations and Warranties of Purchaser and Guarantor. Each of
Purchaser and Guarantor, as to itself, represents and warrants to
Three E and AJG as follows:

(a) The execution, delivery and performance of this Agreement and all
other agreements, instruments, certificates and documents, if any, to
be executed and delivered to Three E, James Lentz or AJG, as the case
may be, pursuant to the terms hereof (the "Additional Documents") by
Purchaser or Guarantor, as the case may be, have been duly authorized
by all requisite action of Purchaser or Guarantor, as the case may
be, and this Agreement and the Additional Documents are valid and
binding obligations of Purchaser or Guarantor, as the case may be,
enforceable against Purchaser or Guarantor, as the case may be, in
accordance with their respective terms except to the extent that
enforcement may be affected by laws relating to bankruptcy,
reorganization, insolvency and creditors rights and by the
availability of injunctive relief, specific performance and other
equitable remedies.

(b) There is no litigation, dispute or proceeding pending, or to
Purchaser's or Guarantor's knowledge, threatened, against or relating
to Purchaser or Guarantor and which would have a material adverse
effect on Purchaser's or Guarantor's ability to perform its
obligations hereunder (including without limitation in each such
case, any proceeding before any federal, state or municipal
department, board, bureau, agency or instrumentality).

(c) Each of Purchaser and Guarantor is a valid and existing entity of
the type specified elsewhere herein, organized under the laws of the
jurisdiction specified elsewhere herein and has the requisite power
and authority to enter into and to perform the terms of this
Agreement and each of the Additional Documents.

(d) Except for any consent or waiver listed in Schedule 6(d), no
consents, approvals, orders or authorizations of any federal, state
or local governmental commission, board, agency, authority or other
regulatory body, or any nongovernmental third party, are required for
Purchaser's or Guarantor's execution, delivery and performance of
this Agreement or any of the Additional Documents.

(e) There are no court (or other governmental entity) judgments,
orders, or decrees of any kind against Purchaser or Guarantor which
are unpaid or unsatisfied of record, nor any actions, suits or other
legal or governmental administrative proceedings pending or, to the
best of Purchaser's or Guarantor's knowledge, threatened against
Purchaser or Guarantor, as the case may be, which is likely to have a
material adverse effect on Purchaser or Guarantor or the ability of
Purchaser or Guarantor to consummate the transactions contemplated by
this Agreement and each of the Additional Documents.

15

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(f) The Partnership Interests to be acquired by Purchaser pursuant to
this Agreement are and shall be acquired for Purchaser's own account,
for investment purposes only and not with a present view to or
intention of, distribution or resale thereof in violation of any
federal or state securities laws and that, irrespective of any other
provisions of this Agreement, the Partnership Interests shall be
transferred only in compliance with all applicable federal and state
securities laws.

(g) If the Due Diligence Period expires without a termination of this
Agreement by Purchaser pursuant to Section 20(c)below, then each of
Purchaser and Guarantor represents and warrants that it (i) has had
the opportunity to ask questions and receive answers concerning the
terms and conditions of the sale of the Partnership Interests
hereunder; and (ii) has had full access to such information and
materials concerning the Company, the Company Subsidiaries and the
Property as Purchaser or Guarantor, as the case may be, has
requested. Each of the Company, Three E, Lentz and AJG, respectively,
has answered all inquiries that Purchaser or Guarantor, as the case
may be, has made to the Company, Three E, Lentz and AJG, respectively
relating to the Company, the Company Subsidiaries, the Property and
the sale of the Partnership Interests hereunder.

(h) The execution, delivery and performance of this Agreement or any
of the Additional Documents by Purchaser or Guarantor, as the case
may be, does not and shall not conflict with, violate or cause a
breach of its organizational documents or bylaws or any agreement,
contract or instrument to which Purchaser or Guarantor, as the case
may be, is a party or by which it is bound, or any judgment, order of
decree to which Purchaser or Guarantor, as the case may be, is
subject.

Filings Under the Hart Scott Rodino Act. Within ten (10) Business
Days after the execution of this Agreement, Purchaser shall file with
the Federal Trade Commission ("FTC") and the United States Department
of Justice, Antitrust Division ("Justice"), all required filings by
Purchaser under the Hart Scott Rodino Antitrust Improvement Act of
1976, as amended, with respect to the transactions contemplated by
this Agreement and shall pay the applicable filing fee for such
filing. The Company and Seller shall take whatever steps shall be
reasonably required to make any filing required of the Company or
Seller under the HSR Act within the aforesaid ten (10) Business Day
period. Each of the Company, Seller and Purchaser, each at its
respective expense, shall diligently take and pursue such steps and
provide such additional information or responses as shall be required
to satisfy any request for additional information received from the
FTC or Justice.

Indemnification, Limitations and Survival.

(a) (i) Subject to the limitations set forth in this Agreement, Three
E, AJG and Lentz shall jointly and severally indemnify, defend and
hold harmless Purchaser, its Affiliates, and each of their respective
partners, officers, directors,

16

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shareholders, members, employees and agents, and each of their
successors, heirs, and assigns, jointly and severally, from and
against any and all loss, cost, liability and claims whatsoever,
including reasonable attorneys' fees actually incurred by Purchaser
herein with respect to "Claims" resulting from any misrepresentation
or breach of any warranty or non-fulfillment of any covenant or
agreement made by Seller in this Agreement, (including without
limitation a representation or warranty becoming inaccurate, untrue
or incorrect as a result of Seller's breach of any of its obligations
under this Agreement) and which is not waived or otherwise accepted
by Purchaser. Purchaser acknowledges and agrees that (i) Three E and
Lentz (and not AJG) shall be jointly and severally liable for any
misrepresentation or breach of warranty which is made by Three E
solely as to itself and set forth in Sections 5(i),

(iii), (iv), (v) and (xx) hereof; and (ii) AJG (and not Lentz or
Three E) shall be solely liable for any misrepresentation or breach
of warranty which is made by AJG solely as to itself and set forth in
Sections 5(i), (iii), (iv), (v) and

(xx) hereof; and (iii) in the event of any claim for indemnification
relating to, arising from or in connection with title to the
Property, Purchaser shall first seek recovery from the title
insurance company or companies which has or have issued a title
insurance policy to the Company with respect to the Property and
shall not make a claim against Three E, Lentz or AJG with respect
thereto to the extent same is a matter which is insurable against by
a title insurance company

(ii) The aggregate liability of each of Three E and Lentz under all
indemnification provisions of this Agreement shall, if Closing occurs
hereunder, be limited to the sum of (i) One Million Dollars
($1,000,000) under the second sentence following this sentence, or
Two Million Dollars ($2,000,000) in the aggregate under the second
and third sentences following this sentence, or such lesser sum as
shall be payable pursuant to the Deferred Payment Agreement (subject
to the provisions of Section 8(g) below, Purchaser and the Company
shall only be entitled to offset against sums payable to Three E by
the Company or the Purchaser, pursuant to the Deferred Payment
Agreement, the amounts of all obligations and liabilities of Three E
and Lentz hereunder) and (ii) Claims resulting from Exclusion Items
(as that term is defined below). Neither Three E, Lentz nor AJG shall
have any liability for breach of representation or warranty under
this Agreement unless the aggregate Damages for all such breaches
shall exceed Five Hundred Thousand Dollars ($500,000) (the
"Threshold") in which event they each, subject to the liability
limitations and other provisions set forth below, shall be liable for
Damages from the first dollar of Damages; provided, however, that any
representation or warranty of Seller which, to the Knowledge of Lentz
or the Knowledge of Three E or AJG, was untrue when made, and claims
resulting from Exclusion Items (as that term is defined below) shall
not be subject to the Threshold. Purchaser agrees that the first One
Million Dollars ($1,000,000) of indemnification liability of Seller
hereunder shall be payable solely by Three E and Lentz (solely from
any sums otherwise payable to Three E pursuant to the Deferred
Payment Agreement) and, anything in this Agreement to the contrary
notwithstanding, AJG shall have no responsibility therefor.
Thereafter any

17

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indemnification liability of Seller hereunder shall, to the extent
not exceeding an additional Five Million dollars ($5,000,000), be
payable pro rata 80% by AJG currently and 20% by Three E and Lentz
from any sums otherwise payable to Three E pursuant to the Deferred
Payment Agreement and AJG shall bear 100% of aggregate
indemnification obligations of Seller in excess of Six Million
Dollars ($6,000,000), subject to the provisions for maximum
indemnification liability set forth in this Agreement. "Exclusion
Items," as such term is used herein, shall mean any and all of the
following: (i) claims of and liabilities to taxing authorities for
taxes, interest and penalties; (ii) gross negligence; (iii) willful
or wanton misconduct; (iv) knowing and material misrepresentations or
breach of warranties or covenants; (v) violations of law; (vi)
actions which subject the Company to liability to a third party under
any "bad boy" covenants from nonrecourse provisions of loan documents
or other agreements; (vii) liability relating to employee matters;
and (viii) liability relating to environmental matters with respect
to which the representations and warranties of Sections 5(ii) or
(xxi) have been breached. Anything to the contrary herein
notwithstanding, but subject to the provisions of Section 8(b) below,
Claims resulting from Exclusion Items shall not be subject to any
limitation on the extent of liability for indemnification under this
Agreement.

(b) Anything in this Agreement to the contrary notwithstanding, the
aggregate liability of AJG under all indemnification provisions of
this Agreement shall, if Closing occurs hereunder, be limited to the
sum of Eight Million Dollars ($8,000,000) plus Damages relating to
the Exclusion Items described in (i),

(ii), (iii) and (iv) of the definition of Exclusion Items above, but
solely as it relates to the conduct of AJG and no other person.

(c) The representations, warranties, covenants and indemnities of
Three E, Lentz and AJG, respectively, herein shall survive the
Closing for a period of eighteen

(18) months except that the survival period for subparagraph (i) of
the Exclusion Items shall be the expiration of the statute of
limitations respecting the particular tax liability at issue, and the
survival period for the remaining Exclusion Items shall be three (3)
years from the Closing Date (as applicable, the "Survival Period").
Any claim thereunder must be made by notice to Seller given prior to
the expiration of the Survival Period. Except with respect to
breaches that are known to Purchaser at the time of Closing (which
breaches shall be deemed waived for all purposes upon consummation of
the Closing if Purchaser fails to notify Seller in writing prior to
the Closing that Purchaser intends to assert a claim therefor),
Purchaser shall not be deemed to have waived any claim based upon
Seller's breach of any of the representations, warranties, covenants
or indemnities herein.

(d) The provisions set forth in this Agreement respecting the
obligations and liabilities of Three E, Lentz and AJG, respectively,
including, without limitation, the provisions of this Section 8,
shall be the exclusive remedy Purchaser shall have with respect to
any claim arising from, in connection with or related to this
Agreement or any transaction contemplated hereby.

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(e) Any indemnity obligations of Three E, Lentz and AJG,
respectively, shall be reduced by (i) the amount of any insurance
proceeds paid to Purchaser, or any Affiliate of Purchaser, the
Company or any Company Subsidiary with respect to the matter which is
the subject of the indemnification claim; and (ii) the amount of any
net savings received from any tax benefits to Purchaser, the Company
or any Company Subsidiary resulting from any such matter; and (iii)
any amount paid to Purchaser, any Affiliate of Purchaser, the Company
or any Company Subsidiary with respect to such matter pursuant to any
surety, guarantee, contribution agreement, indemnification agreement
or other agreement or arrangement with a third party (other than
Three E, Lentz or AJG). In the event Purchaser shall be indemnified
hereunder prior to the receipt by Purchaser or any Affiliate of
Purchaser or the Company or any Company Subsidiary of any payment or
benefit to which it is entitled and which would reduce the
indemnification obligation of Three E, Lentz or AJG, respectively
pursuant to this Section 8(e) then, contemporaneously with any
indemnification payment and as a condition precedent thereto,
Purchaser shall execute and deliver to the indemnifying party or
parties, an assignment of all rights of recovery of any such
insurance claim or otherwise pursue payment and the right to retain
the proceeds thereof (to the extent of the indemnification payment
made to Purchaser, any excess thereof to be promptly remitted to
Purchaser), provided however that Purchaser shall retain the right to
adjust same with the insurance company or otherwise pursue such claim
and hereby agrees to act reasonably and diligently in doing so and to
keep Seller reasonably informed as to the status and progress
thereof..

(f) Any indemnity obligation of Three E, Lentz and AJG, respectively,
shall only be to the extent of actual direct damages, and any claim
for special, punitive, exemplary or any other type of damages shall
be deemed waived by Purchaser and shall not be recoverable in
connection with any asserted claim for indemnity by Purchaser or any
Affiliate of Purchaser; provided, however, if any claim for
indemnification results from any suit, action or proceeding against
the Company or any Company Subsidiary by an independent third party
for which Lentz, Three E or AJG has liability hereunder, then the
indemnification obligation shall be based upon the damages, if any
and of whatever type, that are awarded to such third party by a court
of competent jurisdiction.

(g) Any indemnification obligation of Three E, Lentz or AJG, as the
case may be, shall solely be based upon a final adjudication by a
court of competent jurisdiction from which all rights of appeal have
expired or as a result of a duly executed settlement agreement
entered into between Purchaser and the party against which
indemnification is sought. Purchaser shall have no direct right of
setoff against any amounts owing to Lentz, Three E or AJG unless and
until such final adjudication has been made. To the extent a claim is
asserted by Purchaser against Lentz or Three E, Purchaser shall make
payment of so much of the sums to which they are otherwise entitled
pursuant to the Deferred Payment Agreement up to the amount of
alleged Damages into escrow with the

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Escrow Agent in an interest bearing account pending final resolution
of any claim. Interest or earnings will be prorated based upon the
amount distributed to each party from the escrow.

(h) In furtherance of the provisions of Section 28(l) hereof, in the
event Purchaser or Seller shall assert a claim under this Agreement
against another Party, and shall not be the prevailing party as
determined by order of a court of competent jurisdiction from which
all rights to appeal have expired, then upon demand such claimant
shall reimburse such other Party(ies), for all fees, costs and
expenses, including reasonable attorneys fees, suffered, sustained or
incurred by such other Party in defending against such claim.

(i) Purchaser shall, and shall cause each of the Company and each
Company Subsidiary to, provide to Three E, AJG and their respective
representatives, full and complete unrestricted access to the Books
and Records of Purchaser, the Company or any such Company Subsidiary
during normal business hours, with the full right to make copies,
extracts, compilations or other paper or electronic evidence thereof,
in connection with the defense of any claim asserted against Three E,
Lentz or AJG hereunder, or in connection with any federal or state
tax matters regarding or affecting Three E, Lentz or AJG, as the case
may be.

9. Violations. At Closing the Property (other than with respect to
environmental matters which are separately provided for elsewhere
herein and subject to the other provisions herein including, without
limitation, Section 8(c)), shall be free from any and all violations
of law or governmental ordinances, orders or requirements which are
now or hereafter existing and/or noted, filed or recorded in or
issued by any federal, state, county or municipal department, agency,
authority or bureau as to conditions affecting the Property which
materially and adversely affect the value or intended use of the
Property (the "Violations"), and with respect to which the Company or
Seller has received written notice, it being understood and agreed
that none of Three E, Lentz, AJG, the Company or any of the Company
Subsidiaries shall have any duty whatsoever to make any independent
investigation or inquiry as to conditions affecting the Property. It
is further understood and agreed that Seller and the Company shall
have the right to contest any alleged violation in good faith, and to
terminate this Agreement and the purchase rights of Purchaser
hereunder, by giving written notice of termination to Purchaser, if
the reasonably anticipated aggregate cost to cure all such violations
exceeds One Million Dollars ($1,000,000). Seller, in its discretion,
may adjourn the Closing for up to thirty (30) days in order to
resolve any claimed Violations. If Seller is unable to eliminate all
Violations in accordance with the terms of this Agreement on or
before such adjourned date for the Closing, Purchaser may, in
addition to any additional rights and remedies which it may have
hereunder, or at law or in equity, elect by written notice given to
Seller within five (5) days after such adjourned date for the
Closing, either to (1) terminate this Agreement and receive the
return of the Downpayment as Purchaser's sole and exclusive remedy,
or (2) close hereunder subject to such Violations and proceed to make
a claim against Seller (subject to any limitations provided herein).
In the event Purchaser shall fail to timely give the aforesaid
written notice to Seller, then Purchaser shall be deemed, without
further notice or action of any kind by Seller, to have elected to
close hereunder pursuant to clause (2) of the immediately preceding
sentence.

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10. Certain Books and Records. In augmentation of and without
limitation upon Seller's obligation herein to provide or cause the
Company to provide access to all Books and Records to Purchaser,
Seller shall make available and shall cause the Company to make
available for Purchaser's examination until the earlier to occur of
the Closing or the termination of this Agreement, at Seller's office
or such other location reasonably convenient to Purchaser as Seller
may designate, all documents, records, statements and accounts in the
possession or control of Seller, the Company or the Company's
property manager relating to (i) Sale Contracts and the deposits and
payments thereunder and conveyances thereunder;

(ii) rents under the Leases and the collection or payment thereof;
and (iii) the Underlying Obligations and expenditures thereunder; and
(iv) the operation of the Property and expenditures made in
connection therewith. On the Closing Date, Seller shall furnish or
cause to be furnished to Purchaser a statement which shall be
accurate as of the Closing Date, of all purchase prices and deposits
under the Sale Contracts and all then prepaid and all then
uncollected and delinquent rents and under the Leases.

11. Intentionally omitted.

12. Operation of the Business of the Company and the Company
Subsidiaries. The Company and each of the Company Subsidiaries shall
have the unrestricted right to operate and conduct its respective
business between the date hereof and the Closing Date in the ordinary
course and consistent with past practices.

13. Deliveries by Seller at Closing. At the Closing, Seller shall
deliver the following to Purchaser:

(i) (i) Assignments of Partnership Interests in a commercially
reasonable form agreed to by Purchaser and Seller prior to the
Closing Date, executed by each of the Sellers (as to the portion of
the Partnership Interests owned by such Seller), assigning and
transferring to Purchaser, good and marketable title to that portion
of the Partnership Interests owned by such Seller, free of all liens,
encumbrances and claims of others, such that, through the Company,
Purchaser shall have good, marketable and insurable title in and to
the feehold of the Land, Buildings and Improvement, together with all
appurtenances and rights running with the Land, subject only to the
"Permitted Exceptions" (defined below), and (ii) its certified
check(s), to the order of the appropriate tax collecting agency or
official, in the amount of any and all transfer taxes, documentary
transfer stamps, and any local "recording" tax and other taxes, fees
and charges, which shall be payable by reason of the transfer and
assignment of the Partnership Interests from Seller to Purchaser. In
lieu of delivering such certified checks, Seller may, by notice given
to Purchaser not later than fifteen days prior to the Closing Date,
elect to have Purchaser pay any of such taxes and charges and give
Purchaser a credit on the Closing Date against the Purchase Price in
the amount thereof.

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(j) A schedule of all cash security deposits paid by the tenants
under the Leases and the accrued interest on each of such cash
security deposits. With respect to any lease securities which are in
a form other than cash, Seller shall deliver to the Company at the
Closing any documents or instruments constituting or evidencing such
lease securities together with any appropriate instruments of
assignment or transfer executed by the named beneficiary thereunder,
if it is not the Company.

(k) Notices to the tenants under the Leases in a commercially
reasonable form agreed to by Purchaser and Seller prior to Closing,
executed by Seller, directing that rents and other payments
thereafter be sent to the Company at such address as Purchaser may
direct, and including such other matters as may be reasonably
required by Purchaser.

(l) All keys to all entrance doors to, and equipment and utility
rooms located in, the Property, which keys shall be properly tagged
for identification, and all of the following: computer passwords,
access cards and security codes to all portions of the Property.

(m) All (A) original permits and licenses issued for or with respect
to the Property by governmental and quasi governmental authorities
having jurisdiction that are in Seller's possession and (B)
warranties and guarantees (collectively, the "Warranties"), in
Seller's possession, which Seller has received in connection with any
work or services performed or equipment installed at the Property.

(n) A current Rent Roll listing each tenant of the Property in the
form annexed hereto as Exhibit G and a current list of all Underlying
Obligations.

(o) An assignment to the Company, in a commercially reasonable form
agreed to by Purchaser and Seller prior to Closing, of all right,
title and interest of the nominal holder thereof, in and to those
Service Contracts if any, which are held in a name other than that of
the Company or any Company Subsidiary.

(p) Resolutions and consents evidencing Seller's (such term includes
all Seller Affiliates) authority to execute and deliver the documents
and instruments described herein.

(q) A "FIRPTA" certificate duly executed and acknowledge by Seller
and any other directed transferee of any portion of the Purchase
Price, in accordance with

Section 1445 of the Code.

(r) A certificate of Seller, dated as of the Closing, certifying the
fulfillment of the conditions set forth in Section 16hereof.

(s) From each holder of Assumed Indebtedness and each other
Underlying Obligee, to the extent required by the express terms of
the Assumed Indebtedness or Underlying Obligation (i) an original
Underlying Obligee's consent to the transaction contemplated hereby
(provided, however that Seller's failure to obtain any of such
consents, if and to the extent that the lack of such consents not so
obtained would not, in

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the aggregate result in a material adverse effect upon the Company or
Purchaser, shall not be deemed a default by Seller under this
subsection (k)) and (ii) estoppel certificates to the extent received
by the Company, acknowledging that the Company is not in breach under
the Underlying Obligations (it being understood that if a particular
Underlying Obligee is not under any obligation to deliver such
estoppel certificate, that Seller is only required to use
commercially reasonable efforts to obtain same, which shall not be
deemed to include the payment of any funds therefor other than
reasonable ministerial processing fees), each such consent and
estoppel certificate to be dated not more than forty-five (45) days
prior to the Closing Date in form reasonably acceptable to Purchaser
and Seller.

(t) The Deferred Payment Agreements, duly executed by Three E and
Lentz and by AJG, respectively.

(u) The Harmony License duly executed by Three E and Harmony
Institute.

(v) The Lentz Employment Agreement executed by Lentz.

(w) The Veterinary Restriction Agreement duly executed by Harmony
Institute.

(x) Written resignations of all officers and other representatives of
the Company and Company Subsidiaries (as such officers and
representatives, having control of the Company and Company
Subsidiaries, as distinct from resignation from employment, it being
intended that such employment shall continue in accordance with
Section 25(h)) requested in writing by Purchaser to Seller not less
than three (3) Business Days before the Closing Date signed by each
such officer or representative.

(y) A fully-paid (by Sellers, rather than the Company) directors and
officers liability insurance policy in form and content reasonably
acceptable to Three E and Lentz, pursuant to which Lentz and Three E
will be provided coverage for their activities on behalf of the
Partnership for the period prior to the Closing Date.

(z) Any and all other documents Seller is required to deliver
pursuant to the provisions of this Agreement.

14. Intentionally Omitted.

15. Deliveries by Purchaser at Closing. At the Closing, Purchaser
shall deliver the following to Seller:

(a) The Cash Portion of the Purchase Price.

(b) Documentation establishing to Seller's reasonable satisfaction
the due authorization of Purchaser's acquisition of the Partnership
Interests and the delivery of the documents required to be delivered
by Purchaser pursuant to this Agreement.

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(c) Documentation establishing to Seller's reasonable satisfaction
the due authorization of Guarantor's execution and performance of all
of Guarantor's obligations under this Agreement and the Deferred
Payment Agreements.

(d) The Deferred Payment Agreements, duly executed by Purchaser.

(e) The Harmony License duly executed by the Company.

(f) The Lentz Employment Agreement and other employment agreements,
duly executed by the Company and Purchaser.

(g) The Veterinary Restriction Agreement, duly executed by the
Company

(h) Any and all other documents Purchaser or Guarantor is required to
deliver pursuant to the provisions of this Agreement.

Conditions to Closing Obligations.

(a) Notwithstanding anything to the contrary contained herein, the
obligation of Seller to consummate the sale, transfer and assignment
of the Partnership Interests and the other transactions contemplated
by this Agreement is expressly conditioned upon the fulfillment by
and as of the time of the Closing of each of the conditions listed
below, provided that Seller, at its election, evidenced by written
notice duly executed by each of Three E and AJG and delivered to
Purchaser at or prior to the Closing, may waive any of such
conditions:

(i) Each of Guarantor and Purchaser shall have executed and delivered
to Three E, AJG and Lentz, respectively, all documents specified in
Section 15, which are deliverable to each such respective party,
Purchaser shall have paid the Purchase Price and each of Purchaser or
Guarantor, as the case may be, shall have taken or caused to be taken
all of the other material action required of such party in this
Agreement.

(ii) All representations and warranties made by Purchaser in this
Agreement shall be true and correct in all material respects as of
the date of the Closing.

(iii) No suit, proceeding, investigation or other action shall be
instituted and pending on the Closing Date against the Company or
either Seller which seeks to enjoin or otherwise impair the
consummation of the transactions contemplated by this Agreement.

(iv) The waiting period under the HSR Act shall have expired.

(v) Guarantor shall have provided to Three E, Lentz and AJG such
financial information and other supporting documentation reasonably
required by any of Three E, Lentz or AJG to confirm the financial
ability of Guarantor to fully satisfy any obligations it has or may
have pursuant to this Agreement and the Deferred Payment Agreements.

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(b) Notwithstanding anything to the contrary contained herein, the
obligation of AJG to consummate the sale, transfer and assignment of
the Partnership Interests and the other transactions contemplated by
this Agreement is expressly conditioned upon the receipt by AJG of
written documentation establishing to AJG's reasonable satisfaction
that, effective with the Closing on the Closing Date, (i) AJG shall
be fully and completely released from any guarantee of any
indebtedness of the Company or any Company Subsidiary or indebtedness
to which the Property will remain subject, following the Closing,
other than with respect to the Bond Indebtedness, and (ii) AJG shall
be entitled to the prompt return of all collateral or other security
provided by AJG or any of its Affiliates with respect to, or in
connection with any such indebtedness other than with respect to the
Bond Indebtedness. The parties agree that the transactions
contemplated by this Agreement shall not be consummated unless the
condition precedent in this Section 16(b) shall be satisfied or
waived by AJG in writing.

(c) Notwithstanding anything to the contrary contained herein and
subject to the provisions set forth below, the obligation of
Purchaser to consummate the sale, transfer and assignment of the
Partnership Interests and the other transactions contemplated by this
Agreement is expressly conditioned upon the fulfillment by and as of
the time of the Closing of each of the conditions listed below,
provided that Purchaser, at its election, evidenced by written notice
delivered to Seller at or prior to the Closing, may waive all or any
of such conditions:

(i) Seller shall have executed and delivered to Purchaser all of the
documents, and shall have taken or caused to be taken all of the
other material action required of Seller under this Agreement.

(ii) All representations and warranties made by Seller in this
Agreement shall be true and correct in all material respects when
made and, subject to the following, as of the Closing Date.
Subsequent to the date hereof, to and including the Closing Date,
Seller shall have the right to amend the Schedules hereto to reflect
the operations of the Company and each Company Subsidiary in the
normal course of business between the date hereof and the Closing
Date. No such amendment shall have the effect of correcting or
remedying any breach of representation or warranty made by Seller on
the date of this Agreement. Purchaser shall otherwise be obligated to
close. Purchaser shall be entitled to make a claim based on such
failure, subject to and in accordance with the applicable
indemnification provisions of this Agreement.

(iii) No suit, proceeding, investigation or other action shall be
instituted and pending on the Closing Date against Purchaser which
seeks to enjoin or otherwise impair the consummation of the
transactions contemplated by this Agreement.

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(iv) The waiting period under the HSR Act shall have expired.

(v) The Title Company shall be willing to insure title to the
Property pursuant to an ALTA 1992 Owner's policy of Title Insurance
in the amount of the Purchase Price at regular rates and without
additional premium, subject only to the Permitted Exceptions and
other standard exceptions including survey exceptions and as
otherwise provided for in this Agreement (the "Title Policy").

Anything in this Agreement to the contrary notwithstanding, Purchaser
shall be obligated to close unless on the Closing Date, the aggregate
of the failures of Seller to take any required action hereunder, and
the effect of all breaches of representation and warranty by Seller
hereunder, and any failure to occur of any condition to Closing
specified in Section 16(c) above, taken together, are material and
adverse to the Property or the business of the Company and the
Company Subsidiaries, taken as a whole. If Purchaser shall fail or
refuse to close, as aforesaid, then Seller, subject to the following
sentence, shall be entitled to the payment (as provided in Section
24hereof) of the Downpayment by the Escrow Agent as liquidated
damages and as Seller's sole and exclusive remedy, it being
understood and agreed that Seller shall not have a right of specific
performance against Purchaser. If there shall be a dispute between
Purchaser and Seller as to whether Purchaser is or is not obligated
to close the purchase of Partnership Interests pursuant to the test
set forth above in this paragraph, then such dispute shall be
submitted by any Party to the Arbitrator for decision, which decision
shall be final and binding upon the Parties without further recourse.
If the Arbitrator shall decide in favor of Purchaser then it shall be
entitled to the return of the Downpayment as liquidated damages and
as its sole and exclusive remedy.

Title.

(a) Upon Closing, the Company shall hold good marketable and
insurable feehold title to the Property subject only to the
"Permitted Exceptions" (as defined below). Seller shall eliminate
defects, objections or exceptions disclosed in any title commitment
or continuation thereof obtained by Purchaser from the Title Company
other than Permitted Exceptions, including without limitation: (i)
mortgages or other liens other than mortgages securing Assumed
Indebtedness which Purchaser shall have elected to have remain on the
Property after Closing and for which Purchaser shall have received a
credit against the Purchase Price as provided in Section 3, (ii)
judgments against the Company or other defects or objections to title
caused by Seller or the Company which are not Permitted Exceptions or
(iii) liens and encumbrances created by the act or omission of Seller
or the Company after the date hereof; other than immaterial ones
created in the ordinary course of the Company's business. Seller, in
its discretion, may adjourn the Closing for up to thirty (30) days in
order to eliminate unacceptable defects, objections or exceptions. If
Seller is unable to eliminate all unacceptable defects, objections or
exceptions in accordance with the terms of this Agreement on or
before such adjourned date for the Closing, Purchaser may, in
addition to any additional rights and remedies which it may have
hereunder, or at law or in equity, elect by written notice

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given to Seller within five (5) days after such adjourned date for
the Closing, either to (1) terminate this Agreement if the aggregate
cost to cure or eliminate all such defects, objections or exceptions
shall exceed One Million Dollars ($1,000,000), in which event the
provisions of Section 17(d) shall apply, or (2) close hereunder
notwithstanding that the Company's title is subject to such defects,
objections or exceptions and proceed to make a claim against Seller;
provided, however, that anything in this Agreement to the contrary
notwithstanding, in the event the aggregate cost to cure or eliminate
all such defects, objections or exceptions (other than Permitted
Exceptions and defects, objections or exceptions of the types
specified in clauses (i), (ii) and (iii) above, all of which Seller
shall be obligated to eliminate) shall exceed One Million Dollars
($1,000,000) then Seller (or either of them) shall have the
unrestricted right to terminate this Agreement by sending written
notice of termination to the Purchaser, unless Purchaser shall accept
title subject to such defect, objection or exception in which case it
shall receive at Closing a credit against the Purchase Price in the
amount of One Million Dollars ($1,000,000), failing which Purchaser's
sole and exclusive remedy hereunder shall be the return of the
Downpayment. In the event Purchaser shall fail to timely give the
aforesaid written notice to Seller, then Purchaser shall be deemed,
without further notice or action of any kind by Seller, to have
elected to close hereunder pursuant to clause (2) of the immediately
preceding sentence.

(b) If a search of the title discloses judgments, bankruptcies or
other returns against other persons having names the same as or
similar to that of the Company, Seller, upon request by Purchaser or
the Title Company, shall deliver to Purchaser or the Title Company
affidavits showing that such judgments, bankruptcies or other returns
are not against the Company.

(c) If any instruments, affidavits, documentary evidence or deposits
are required by the Title Company in order to eliminate an exception
for a defect in or objection to title (including, without limitation,
standard printed exceptions), the following shall apply:

(i) all such instruments and affidavits shall be in such form and
shall contain such terms and conditions as may be reasonably required
by the Title Company to cause it to eliminate an exception from its
title policy for such defect in or objection or exception to title;

(ii) any such documentary evidence shall be delivered to, and any
such deposits shall be made with, the Title Company;

(iii) Seller agrees to execute, acknowledge and deliver any such
instrument and affidavit, to deliver any such documentary evidence,
and to make any such deposit, in and to the extent necessary to
release or discharge items of the types set forth in clauses (i)
through (iii) of Section 17(a);and

27

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(iv) Purchaser agrees to promptly execute, acknowledge and deliver
any instrument, document or affidavit reasonably requested by the
Title Company.

(d) If Seller fails or is unable to perform its obligations in
accordance with the terms of this Section 17 and Purchaser elects to
terminate this Agreement as a result thereof, the Escrow Agent shall
promptly cause the Downpayment to be returned to Purchaser in
accordance with Section 24 below as Purchaser's sole and exclusive
remedy. Upon the making of such refund and payment, this Agreement
shall terminate and no party to this Agreement shall have any further
rights or obligations hereunder except under Sections 21, 22 and 28,
which shall survive such termination.

Seller's Remedies. Subject to the provisions below, if Purchaser
shall fail to close pursuant to and in accordance with the terms of
this Agreement (Seller having performed its obligations hereunder in
all material respects), then Seller's sole remedy shall be to direct
the Escrow Agent to deliver the Downpayment to Seller in accordance
with Section 24 below as liquidated damages for all loss, damage and
expense suffered by Seller, and thereupon this Agreement shall
terminate and the Parties shall have no further rights or obligations
hereunder except under Sections 20(a)(iv), 20(d), 20(e), 21, 22 and
27, which shall survive such termination; provided, however that all
indemnification obligations of Purchaser which arise pursuant to the
terms hereof (those being solely pursuant to Section 20 hereof) shall
survive any termination of this Agreement and shall not be limited in
any manner pursuant to this Section or any other provision hereof.

Purchaser's Remedies. If Seller shall fail to close pursuant to and
in accordance with this Agreement, (each of Purchaser and Guarantor
having performed its respective obligations hereunder in all material
respects), then Purchaser shall have the right (in addition to any
other or additional right herein provided) to either (i) terminate
this Agreement and receive the prompt return of the Downpayment,
whereupon neither party shall have any rights or obligations under
the Agreement except under Sections 8, 21, 22 and 28, which shall
survive such termination, or (ii) bring an equitable action for
specific performance against Seller to compel assignment and transfer
of the Partnership Interests in accordance with the provisions of
this Agreement.

Purchaser's Inspection; Due Diligence Period.

(a) The Company hereby grants to Purchaser and to Purchaser's
representatives a license to enter upon all parts of the Property and
to perform such inspections (including, without limitation,
environmental inspections), studies and surveys of the Property and
the Company's operations there, as Purchaser deems necessary or
appropriate in Purchaser's sole, absolute and subjective discretion
during the Due Diligence Period. In connection therewith, Purchaser
and Seller shall comply with the following terms and conditions:

(i) Purchaser shall give Seller and the Company reasonable advance
notice of any such inspection; all such inspections shall take place
during normal business hours of Seller and the Company; each of
Seller and the Company shall

28

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instruct and cause its personnel to cooperate with Purchaser and its
representatives with respect to providing access to books, records,
facilities and the Property, but no Company employee or any employee
of Three or AJG shall in any manner be required to actively
participate in any inspection or other due diligence activities of
Purchaser;

(ii) Prior to Purchaser or Purchaser's representatives performing any
inspections or tests of the Property, Purchaser shall name, or cause
the relevant Purchaser's representative to name each of the Company,
Three E and AJG as an insured party on a commercial general liability
insurance policy with coverage not less than a combined, single limit
of One Million Dollars (U.S. $1,000,000) per occurrence and shall
provide the Company with a certificate of insurance evidencing such
coverage;

(iii) Purchaser shall exercise reasonable efforts to minimize
interference with the activity of the Company and each of the Company
Subsidiaries, its employees, agents, contractors, developers of
individual sites and others at the Property;

(iv) Purchaser, at its sole cost and expense, promptly shall repair,
replace or restore to its preinspection condition any physical damage
to the Property or any other assets of the Company or any Company
Subsidiary caused by its or its representatives' entry thereon or
contact therewith or handling thereof to perform such inspection and
Purchaser's obligations under this Section 20 shall not in any manner
be limited to the Downpayment in the event this Agreement shall be
terminated;

(v) Any such inspections shall be at Purchaser's sole cost and
expense;

(vi) Seller or its representative may be present at all such
inspections or reviews and at any discussion with a party identified
by Purchaser as set forth below in this Section 20(a)(vi); Purchaser
and Purchaser's representatives may have discussions with any
Tenants, Pending Unit/Site Purchasers, Underlying Obligees, or
representatives of any of them; each of the Company and Seller shall
make itself available, and shall request its vendors, developers,
contractors and others to be available as Purchaser shall reasonably
request, to meet with Purchaser and shall cooperate with Purchaser in
all respects in connection with arranging such discussions, anything
in Section 34 below to the contrary notwithstanding; and

(vii) Purchaser shall, in conducting such review, exercise reasonable
efforts to minimize interference with the operation of the Property
or with the activity of each of the Company, each Company Subsidiary
and Seller or any employees or agents of any of them .

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(b) Seller shall, promptly after the date hereof, make the Books and
Records available to Purchaser and shall thereafter make available to
Purchaser any additional Books or Records subsequently generated, all
at Purchaser's cost and expense. During the Due Diligence Period and
thereafter until Closing, Purchaser and Purchaser's representatives
shall have the right to review the Books and Records at the Company's
offices or at another location mutually agreed upon by Seller and
Purchaser. Without limiting the foregoing, Seller hereby represents
that it has made available to Purchaser, true and complete copies of
all of the items listed on Schedule 20 (which shall be prepared by
Seller and delivered to Purchaser within five (5) Business Days after
the date hereof and shall be attached hereto) which are in existence
on the date hereof, all Leases, all Building Contracts Service
Agreements, Warranties, all Underlying Obligations, and all Permitted
Encumbrances and Seller hereby agrees to promptly make available to
Purchaser any updated operating statements and Rent Rolls, to the
extent changed after the date hereof, as applicable from the Rent
Roll attached hereto, and any other material documents relating to
the business of Company or any Company Subsidiary, or the Property
first discovered by Seller after the date of this Agreement.

(c) Purchaser has had access to the Property and all portions thereof
as well as the Books and Records. Purchaser shall promptly complete
due diligence review process as it shall desire in connection with
the Property, the Books and Records and the activities of the
Company, the Company Subsidiaries, Seller and its Affiliates. The
period from the date hereof until March 28, 2005 is herein referred
to as the "Due Diligence Period". During the Due Diligence Period,
Purchaser shall have the absolute right, in its sole discretion, for
any reason or no reason at all, to cancel and terminate this
Agreement in its entirety. If Purchaser elects to so cancel and
terminate this Agreement, Purchaser shall on or before 12:00 Midnight
(EST) of the last day of the Due Diligence Period deliver to Seller
written notice of Purchaser's election to terminate this Agreement
which termination shall be effective upon the giving of such notice.
Subject to the provisions of Section 3(d) hereof, within five (5)
Business Days after Seller's receipt of Purchaser's termination
notice Three E shall cause the Escrow Agent to refund the Downpayment
to Purchaser minus the amount, if any, for which Purchaser is liable
under Section 20(a)(iv) above, it being understood and agreed by
Purchaser that such liability is not limited to the Downpayment. If
Purchaser does not deliver to Seller a timely termination notice, as
aforesaid, then Purchaser shall be deemed to have approved the
results of its due diligence examination, this Agreement shall not
terminate, the Downpayment shall be retained by the Escrow Agent
subject to the terms of this Agreement, and Purchaser shall have no
further rights of termination other than as a result of a failure of
Purchaser's conditions precedent to Closing which permit Purchaser to
terminate this Agreement.

(d) Except to the extent arising out of the gross negligence or
willful misconduct of any of the Company, Company Subsidiaries, or
Seller or any of their respective officers, directors, shareholders
and employees, Purchaser shall indemnify, defend, and hold each of
Three E, Lentz, AJG, the Company and each Company Subsidiary, and
their respective managers, officers, directors, employees, agents,
shareholders, partners, members, and Affiliates of any of them, and
their respective heirs,

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executors, administrators, personal representatives, legatees,
successors and assigns (the "Seller Indemnified Parties") harmless
from and against all liabilities, damages, losses, fines, penalties,
fees, costs and expenses whatsoever including without limitation,
reasonable attorneys' fees, paralegal fees, accounting fees, expert
witness fees, proof of claim expenses, court costs (including any of
the foregoing which arise from the enforcement of this indemnity)
(collectively the "Damages"), as a result of, relating to, or arising
in connection with (i) claims for personal injury, wrongful death or
property damage against any of the Seller, Indemnified Parties, or
the Property, (ii) claims of violation of any law, regulation, order,
rule, permit, requirement or policy of any governmental body or
agency; or (iii) creation of any lien or encumbrance upon any portion
of the Property, in each instance to the extent caused by Purchaser
or Purchaser's representatives' inspection or due diligence
examination of the Property (as distinct from being caused by the
pre-existing condition of the Property). Anything to the contrary in
the preceding portion of this subsection (d) notwithstanding, any
claim under this subsection (d) shall survive Closing only for a
period of eighteen (18) months from the Closing Date. Any such claim
not made (with reasonably specificity) by Seller within such period
shall be deemed waived and extinguished.

Indemnification Procedure.

(e) Notice of Claims. If any of the Seller Indemnified Parties or any
of the Purchaser Indemnified Parties (an "Indemnified Party")
believes that it is entitled to indemnification under this Agreement,
such Indemnified Party shall so notify the Party from whom
indemnification is being claimed (the "Indemnifying Party") as
promptly as practicable, with reasonable particularity in light of
the circumstances then existing, but in any event within sixty (60)
days of the date the Indemnified Party obtained actual knowledge. If
any claim is instituted by or against a third party with respect to
which any Indemnified Party intends to claim indemnification under
this Agreement, such Indemnified Party shall as promptly as
practicable, but in any event within sixty (60) days of the date the
Indemnified Party obtained actual knowledge, notify the Indemnifying
Party of such claim. The notice provided by the Indemnified Party to
the Indemnifying Party shall describe the claim (the "Asserted
Liability") in reasonable detail and shall indicate the amount (or an
estimate) of the losses or damages that have been or may be suffered
by the Indemnified Party. The failure of an Indemnified Party to give
any notice required by this Section 21(a) shall not affect any of the
Indemnified Party's rights under this Agreement or otherwise except
and to the extent that such failure is prejudicial to the rights or
obligations of the Indemnifying Party.

(f) If any action is brought by a third party against any Indemnified
Party, the Indemnifying Party shall be entitled, at its own expense:
(a) to participate in such action and (b) upon notice to the
Indemnified Party made at any time during the course of any such
claim, suit, action or proceeding, to assume the defense thereof;
provided, that (i) the Indemnifying Party's counsel is reasonably
satisfactory to the Indemnified Party, (ii) the Indemnifying Party
shall keep the Indemnified Party informed, on a regular basis, of the
status of such claim, suit, action or proceeding and (iii) the
Indemnifying Party shall consult with the Indemnified Party upon the
Indemnified Party's reasonable request

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for such consultation from time to time with respect to such claim,
suit, action or proceeding. The Indemnified Party shall cooperate
with respect to any such participation, defense, settlement or
compromise. The Indemnified Party shall have the right to employ its
own counsel in any such case, but the fees and expenses of the
Indemnified Party's counsel shall be at the sole expense of the
Indemnified Party unless: (i) the Indemnifying Party shall have
authorized in writing employment of such counsel at the expense of
the Indemnifying Party;

(ii) the Indemnifying Party shall not have employed counsel
reasonably satisfactory to the Indemnified Party to defend such
action within thirty (30) days after the Indemnifying Party received
notice of the Asserted Liability;

(iii) the Indemnified Party shall have reasonably determined that the
Indemnifying Party is not diligently pursuing such action or is not
keeping the Indemnified Party reasonably informed of the status of
such action; or (iv) the Indemnified Party shall have reasonably
concluded that a conflict of interest exists between the Indemnified
Party and the Indemnifying Party, in any of which events the fees and
expenses of one additional counsel shall be borne by the Indemnifying
Party. The Indemnifying Party shall not settle or compromise any
action or consent to the entry of a judgment without the written
consent of the Indemnified Party (which shall not be unreasonably
withheld) that: (a) does not provide for the claimant to give an
unconditional release to the Indemnified Party in respect of the
Asserted Liability; (b) involves relief other than monetary damages;
or (c) places restrictions or conditions on the operation of the
business of the Indemnified Party or any of its Affiliates. The
Indemnifying Party shall not be liable for any settlement of any
claim or action effected without its written consent. After payment
of any Asserted Liability by the Indemnifying Party, the Indemnified
Party, if requested by the Indemnifying Party, shall assign to the
Indemnifying Party all rights the Indemnified Party may have against
any applicable responsible Person in respect of the Asserted
Liability. If the Indemnifying Party chooses to defend any Asserted
Liability, the Indemnified Party shall make available to the
Indemnifying Party any books, records or other documents within its
control that are necessary or appropriate for such defense.

Broker. Each party represents and warrants to the other that it has
not had any communications, contacts or dealings regarding the
subject matter of the transaction provided for in this Agreement,
through any real estate broker or other person who, on the basis
thereof, could be entitled to a finder's fee or commission in
connection with this transaction. Seller and Purchaser hereby
indemnify and agree to defend each other against any and all claims,
demands, costs, expenses (including, without limitation, attorneys'
fees and disbursements) or causes of action arising out of a breach
of their respective representations, warranties and agreements
contained in this Section. The representations, warranties and
obligations contained in this Section shall survive the Closing, or
if the Closing does not occur, the termination of this Agreement.

Casualty; Condemnation.

(g) Purchaser shall purchase the Partnership Interests for the full
Purchase Price as required by the terms hereof, without regard to the
occurrence or effect of any casualty, damage to or destruction of the
Property or any Improvements thereon or condemnation of any portion
of the Property, provided that (i) the cost to repair any such damage
or destruction, or the diminution in the value of the remaining
Property as a

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result of a partial condemnation, as reasonably determined by Seller,
does not exceed One Million Dollars ($1,000,000), and (ii) upon the
Closing either the Company shall, at Closing, retain on hand the
insurance proceeds or condemnation award collected by the Company
plus an amount equal to any insurance deductible and uninsured loss
or else there shall be a credit against the Purchase Price equal to
the amount of any insurance proceeds or condemnation awards collected
by Seller as a result thereof, plus the amount of any insurance
deductible and uninsured loss. At Closing, Seller shall assign to
Purchaser the right to any such proceeds or awards which shall not
have been collected as of the Closing.

(h) If, prior to the Closing Date, the Property (or any portion
thereof) is damaged or destroyed or taken by eminent domain or
condemnation, and the amount of the damage or destruction or
condemnation as referred to in Section 23(a) above, as reasonably
determined by Seller, exceeds One Million Dollars ($1,000,000), then
Purchaser may, at its option, to be exercised by written notice to
Seller within ten (10) days after Seller's notice to Purchaser of the
occurrence thereof, elect to either terminate this Agreement or
consummate the purchase for the full Purchase Price specified herein.
If Purchaser so elects to terminate this Agreement, then this
Agreement shall terminate and the Downpayment shall be returned to
Purchaser and neither party shall have any further rights or
obligations hereunder. If Purchaser does not so elect to terminate,
then upon the Closing, either the Company shall, at Closing, retain
on hand the insurance proceeds or condemnation due and collected by
the Company plus an amount equal to any insurance deductible and
uninsured loss or else Purchaser shall receive a credit against the
Purchase Price equal to the amount of any insurance proceeds or
condemnation awards collected by Seller as a result thereof, plus the
amount of any insurance deductible and uninsured loss. Following
Closing, the Company shall retain the right to any such proceeds or
awards which shall not have been collected as of the Closing.

(i) The provisions of this Section 23 supersede the provisions of any
applicable statutory or decisional law with respect to the subject
matter of this Section 23.

Escrow. The Downpayment and any interest earned thereon, shall be
held by the Escrow Agent, in escrow, and disposed of only in
accordance with the following provisions:

(j) If the Closing under this Agreement occurs, the Escrow Agent
shall, at Closing, deliver the Downpayment to Purchaser.

(k) If for any reason the Closing does not occur and either party
makes a demand upon the Escrow Agent for delivery of the Downpayment
and any interest earned thereon, the Escrow Agent shall give notice
of such demand to the other party. If the Escrow Agent does not
receive an objection from the other party to the action so demanded
within five (5) Business Days after the giving of such notice, the
Escrow Agent is hereby authorized to take such action. If the Escrow
Agent does receive such objection within such period or if for any
other reason the Escrow Agent in good faith

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shall elect not to make such payment, or take such action, the Escrow
Agent shall continue to hold the Downpayment and any interest earned
thereon, until otherwise directed by instructions signed by both
Sellers and Purchaser or a final judgment of a court. However, the
Escrow Agent shall have the right in the event of a dispute to
deposit the Downpayment and all interest thereon with a court of
competent jurisdiction. The Escrow Agent shall give notice of any
such deposit to Seller and Purchaser. Upon such deposit, the Escrow
Agent shall be relieved and discharged of all further obligations and
responsibilities hereunder.

(l) The parties acknowledge that the Escrow Agent is acting solely as
a stakeholder at their request and for their convenience that the
Escrow Agent shall not be deemed to be acting on behalf of any
particular party, and that the Escrow Agent shall not be liable to
any of the parties for any act or omission on its part unless taken
or suffered in bad faith, in willful disregard of this Agreement or
constituting its gross negligence. Seller and Purchaser shall jointly
and severally indemnify and hold the Escrow Agent harmless from and
against all costs, claims and expenses, including attorneys' fees,
incurred in connection with the performance of the Escrow Agent's
duties hereunder, except to the extent same results from actions or
omissions taken or suffered by the Escrow Agent in bad faith, in
willful disregard of this Agreement or constituting gross negligence
of the Escrow Agent. Any fees of the Escrow Agent shall be borne
one-half (1/2) by Purchaser and one-half (1/2) by Seller.

Additional Covenants.

(m) During the period beginning on the date hereof and ending on the
Closing Date or the date of termination of this Agreement without
Closing occurring, Three E shall cause the Company to conduct its
activities, operations and affairs as specified in Section 12 hereof.
Three E shall not and shall cause the Company to not do otherwise,
without approval of Purchaser. Seller shall, prior to the Company's
or a Company Subsidiary's taking any action which is not permitted
without Purchaser's consent under this Section 25, give written
notice thereof to Purchaser, describing in detail the action which it
proposes to take, and consult with Purchaser with regard thereto and
not take such proposed action unless Purchaser shall have approved;
provided, however, that if Purchaser shall not have disapproved of
such action in writing within three (3) Business Days after notice
thereof, such action shall be deemed approved and authorized.
Promptly after entering into documents or agreements, Seller shall
deliver to Purchaser true, correct and complete copies of all
documents or agreements entered into by the Company or a Company
Subsidiary in connection with such action.

(n) Between the date hereof and the Closing, Three E shall cause the
Company to maintain in effect the Company's Casualty Insurance. If
Purchaser shall desire to have the Company's Casualty Insurance
continue beyond the Closing Date, Purchaser shall give written notice
thereof to Three E not less than five (5) Business Days before the
Closing Date and Three E, without any cost to Seller, shall cooperate
to request such continuation of coverage.

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(o) During the Due Diligence Period, Purchaser and its
representatives shall be entitled to arrange for and meet with any
Tenant, Underlying Obligee and other person having dealings or a
relationship with Seller, the Company or the Company Subsidiaries,
provided that Seller and the Company shall be given reasonable prior
notice of any proposed such meeting and any rescheduled or
adjournment date thereof, and shall be entitled to accompany and,
upon request by Purchaser, shall accompany Purchaser or its
representative during any such meeting.

(p) Between the date of this Agreement and the Closing, Three E shall
cause the Company to (i) maintain the Property in the same condition
and state of repair as exists on the date hereof, reasonable wear and
tear and normal maintenance, repair and replacement excepted, (ii)
observe and perform all material obligations to be observed and
performed by the Company under the terms of any Sale Contracts,
Underlying Obligations, Leases, service contracts, mortgages and loan
documents and (iii) otherwise operate the Property in materially the
same manner as before the making of this Agreement. Seller shall not
and shall not permit the Company, the Company Subsidiaries or the
Seller's Parents to remove or transfer to any third party any real or
personal, tangible or intangible property included in the term
"Property" after the date hereof other than in the normal course of
business and consistent with past practices.

(q) In the event that the Company, any Company Subsidiary, Purchaser
or any Affiliate of Purchaser, subsequent to the Closing Date, shall
receive any rebate, refund or payment of any claim including without
limitation, any refund of real estate taxes or other assessments or
impositions which were paid under protest or were otherwise
challenged or contested by the Company or any Company Subsidiary and
which relates to any period prior to the Closing Date, then Seller
shall not be entitled to any portion thereof.

(r) Seller shall prepare and timely file, or cause to be prepared and
timely filed, all income Tax returns and related filings in respect
of the Company and Company Subsidiaries for any taxable period ending
on or before the Closing Date. Each of Three E as to itself and AJG
as to itself shall timely pay (except to the extent such Tax
liability is timely contested to the relevant taxing authority in
good faith) its own share of all income Taxes to the relevant taxing
authority all Taxes due in connection with any such tax returns.

(s) Purchaser shall prepare and or cause to be prepared, all income
Tax returns in respect of the Company and the Company Subsidiaries
for any Tax period ending after the Closing Date which begins before
the Closing Date (a "Straddle Period"). In order to permit the
accurate and timely filing of such returns, Seller shall deliver to
Purchaser, all books and records necessary for the preparation of any
Straddle Period returns. Purchaser shall provide Seller with the
completed Straddle Period tax returns (and such additional
information regarding such Straddle Period tax returns as may
reasonably be requested by Seller). Seller shall notify Purchaser of
any proposed amendments to any such return within ten (10) days of
its receipt of the return. Purchaser shall sign and file such returns
in a timely fashion. Purchaser shall be responsible to

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make any payment required with the filing of any Straddle Period
return (except to the extent such Tax liability is timely contested
to the relevant Tax authority in good faith). Each of Three E, as to
itself, and AJG as to itself shall, within ten (10) days after
demand, reimburse Purchaser for its portion of any Tax for that
portion of the Straddle Period which ends on or before the Closing
Date.

(t) Purchaser shall, or shall cause the Company and each of the
Company Subsidiaries to, employ all of the persons who were employees
of the Company immediately prior to Closing of the Company and each
Subsidiary for a period of twelve (12) months immediately succeeding
the Closing Date on terms of employment, including title, duties,
base compensation, incentive compensation, if any, and benefits,
which are, in the case of each employee, no less favorable than the
terms of employment which are, in effect for such employee
immediately prior to the Closing, subject to the right of the Company
to dismiss any such employee for cause the standards for which are
set forth on Schedule 26(h) which is attached hereto, provided
however, that anything herein to the contrary notwithstanding, the
standard for any dismissal for cause of Lentz shall be such standard
as is set forth in Lentz's Employment Agreement with the Company;

(u) Until such time as 2500 lots shall be sold and closed at the
Property, Purchaser shall continue to consult with the Board of the
Arthur J. Gallagher Neighborhood School in Harmony, Florida (the
"School") respecting the funding needs of the school, and Purchaser
shall continue to provide such funding needs

(up to an aggregate sum of Two Hundred and Fifty Thousand Dollars
($250,000)) consistent with the manner in which funding was provided
prior to closing.

Termination and Exclusivity. In addition to the termination rights of
the Parties set forth above, this Agreement may be terminated as
follows:

(v) By either Purchaser, Three E or AJG if the Closing has not been
consummated on or before April 20, 2005 provided that such failure
has not been caused by any act or omission of the party seeking
termination, and further provided that such failure is not caused by
the failure of the waiting period under the HSR Act to expire.

(w) From the date hereof until the earlier to occur of the
termination of this Agreement or the Closing Date, neither Three E,
Lentz, AJG nor the Company shall engage in discussions with any third
party respecting the possible purchase and sale of Partnership
Interests or, except as contemplated in this Agreement, any of the
Property of the Company, and they shall not, except in connection
with such possible sales contemplated hereby, make available to said
third party the same level of due diligence investigation and review
as is provided for to Purchaser herein.

Notices. All notices, elections, consents, demands, objections,
requests or other communications (including any notice of change of
address) which Seller, Purchaser or Escrow Agent may be required or
desire to give pursuant to, under or by virtue of this Agreement must
be in writing and sent by first class U.S. certified or registered
mail, return receipt requested, with postage

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prepaid, or by Federal Express or other nationally recognized
overnight courier service with receipt signed by or on behalf of the
recipient, or by hand delivery by messenger, addressed as follows:

If to Seller:

Three E Corporation

3500 Harmony Square Drive West

Harmony, Florida 34773

Attn: Mr. James Lentz, President

with a copy to Three E's counsel:

Baker & Hostetler, LLP

200 South Orange Avenue

Sun Trust Center, Suite 2300

Orlando, Florida 32802

Attn: Kenneth C. Wright, Esq.

and

AJG Financial Services, Inc.

The Gallagher Centre

Two Pierce Place

Itasca, Illinois 60143-3141

Attn: Kerry Abbott, Esq.

with a copy to AJG's counsel:

DLA Piper Rudnick Gray Cary US LLP

203 N. LaSalle Street

Suite 1900

Chicago, IL 60601-1293

Attn: Stephen A. Landsman, Esq.

If to the Company prior to Closing (all notices given to the Company
shall be deemed given to the Company Subsidiaries)

Birchwood Acres Limited Partnership LLLP

3500 Harmony Square Drive West

Harmony, Florida 34773

Attn: Mr. James Lentz

With a copy to Company's Counsel:

Baker & Hostetler, LLP

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200 South Orange Avenue

Sun Trust Center, Suite 2300

Orlando, Florida 32802

Attn: Kenneth C. Wright, Esq.

and

AJG Financial Services, Inc.

The Gallagher Centre

Two Pierce Place

Itasca, Illinois 60143-3141

Attn: Kerry Abbott, Esq.

with a copy to AJG's counsel:

DLA Piper Rudnick Gray Cary US LLP

203 N. LaSalle Street

Suite 1900

Chicago, IL 60601-1293

Attn: Stephen A. Landsman, Esq.

If to the Company after Closing:

Birchwood Acres LLP

c/o Starwood Capital Group Global, L.L.C.

320 Interstate North Parkway, Suite 220

Atlanta, Georgia 30339

Attn: Robert Geimer

If to Purchaser or Guarantor:

SOF-HARMONY, L.L.C.

c/o Starwood Capital Group Global, L.L.C.

320 Interstate North Parkway, Suite 220

Atlanta, Georgia 30339

Attn: Robert Geimer

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with a copy to:

Starwood Capital Group, L.L.C.

591 West Putnam Avenue

Greenwich, Connecticut 06830

Attention: Merrick Kleeman

with a copy to Purchaser's consultant:

Lochmere Development Group, Inc.

920 Harbor Bay Drive

Tampa, Florida 33602

Attn: Robert D. Evans, President

with a copy to Purchaser's counsel:

Rinaldi Finkelstein & Franklin LLC

591 West Putnam Avenue

Greenwich, Connecticut 06830

Attn: Eric Franklin, Esq.

If to Escrow Agent:

First American Title Insurance Company

633 Third Avenue

New York, NY 10017

Attn: Philip Salomon, Esq.

Each of Seller, Purchaser and the Company may change the person to
whose attention notices and other communications to it shall be
addressed or change its address for notices and other communications
hereunder by a notice given to the others in the manner provided in
this Section. A notice or other communication sent in compliance with
the provisions of this Section shall be effective on the day
delivered or if earlier, the first day of failure or refusal to
accept delivery of same as shown on the return receipt if sent by
U.S. mail, or on the day delivered, if sent by Federal Express or
other nationally recognized overnight courier service; or on the date
delivered if hand delivered by messenger. Any notice required or
permitted to be given by Seller or Purchaser under this Agreement may
be given by such party's counsel named above.

Miscellaneous.

(x) Except as is otherwise provided for herein, this Agreement
embodies and constitutes the entire understanding between the parties
with respect to the transactions contemplated herein, and all prior
agreements, understandings, representations and statements, oral or
written, are merged into this Agreement. Neither this Agreement nor
any provision hereof may be waived, modified, amended, discharged or
terminated except by an instrument signed by the party against whom
the enforcement of such waiver, modification, amendment, discharge or
termination is sought, and then only to the extent set forth in such
instrument.

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(y) This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective heirs, successors
or legal representatives and permitted assigns. Purchaser shall have
the right, exercisable by notice to Seller, to assign all of its
right, title and interest in and to this Agreement and the
Downpayment to an Affiliate or Affiliates of Purchaser, or designate
one or more Affiliates of Purchaser to whom one or more portions of
the Partnership Interests shall be assigned by Seller; provided,
however, that no such assignment shall release or relieve Purchaser
or Guarantor from any obligations hereunder.

(z) As used in this Agreement, the masculine shall include the
feminine and neuter, the singular shall include the plural and the
plural shall include the singular, as the context may require.

(aa) No waiver by either party of any failure or refusal by the other
party to comply with its obligations shall be deemed a waiver of any
other or subsequent failure or refusal so to comply.

(bb) If any term or provision of this Agreement or the application
thereof to any person or circumstance shall, to any extent, be
invalid or unenforceable, the remainder of this Agreement, or the
application of such term or provision to persons or circumstances
other than those as to which it is held invalid or unenforceable,
shall not be affected thereby, and each term and provision of this
Agreement shall be valid and be enforced to the fullest extent
permitted by law.

(cc) This Agreement shall be governed by, and enforced in accordance
with, the laws of the State of Florida. Seller and Purchaser waive
the right to trial by jury in any action, proceeding or counterclaim
in any matter relating to this Agreement. Seller and Purchaser each
hereby irrevocably and unconditionally submits to the jurisdiction of
any Florida State Court in Osceola County, Florida or Federal Court
of the United States of America sitting in Orlando, Florida, and any
appellate court from any such court, in any suit, action or
proceeding arising out of or relating to this Agreement, or for
recognition or enforcement of any judgment thereon, and each hereby
irrevocably and unconditionally agrees that all claims in respect of
any such suit, action or proceeding shall be heard and determined in
such courts. Seller and Purchaser each agrees that a final judgment
in any such suit, action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any
other manner provided by law. Seller and Purchaser each hereby
irrevocably and unconditionally waives, to the fullest extent it may
legally and effectively do so, any objection which it may now or
hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement in any such
court.

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(dd) Nothing in this Agreement shall benefit or be enforceable by any
person or entity which is not a party hereto. There are no third
party beneficiaries of this Agreement.

(ee) The captions in this Agreement are inserted for convenience of
reference only and do not define, describe or limit the scope or the
intent of this Agreement or of any of the provisions hereof, and
shall not be considered in interpreting or construing this Agreement.

(ff) This Agreement shall not be binding or effective until executed
and delivered by Seller and Purchaser.

(gg) This Agreement may be executed in counterparts, each of which
shall be an original and all of which counterparts taken together
shall constitute one and the same agreement.

(hh) Seller and Purchaser each will from time to time subsequent to
the Closing Date, at the other's request and sole expense but
otherwise without further consideration, execute and deliver such
other instruments of conveyance, assignment and transfer and take
such other actions as may be reasonably requested in order to more
effectively assign and transfer to and vest in Purchaser the
Partnership Interests and otherwise to confirm and effectuate all of
the transactions contemplated by this Agreement, provided the same
does not increase the liability of the delivering party.

(ii) In connection with any litigation between the parties hereto
arising out of this Agreement, the prevailing party shall be entitled
to recover from the other party all costs incurred by the prevailing
party (including, without limitation, reasonable attorneys' fees and
disbursements, which shall be deemed to include fees on retrial,
rehearing and/or appeal).

(jj) Any Party may waive in writing compliance by any other Party
with respect to any of such other Party's representations, warranties
and agreements set forth in this Agreement and/or may waive in
writing any of the conditions of this Agreement in its favor,
provided, however, that no such waiver shall be binding upon Seller
unless it is duly executed by AJG and Three E.

(kk) All press releases and other publicity and communications
relating to the transactions contemplated by this Agreement
(exclusive of matters relating to Purchaser's continuing ownership of
the Company after the Closing Date, and the timing and method of
release thereof, shall require prior written approval of each of
Purchaser, Lentz and AJG.

Conveyance of Parcels to Harmony Institute.

(ll) Seller shall, no later than the Closing Date, cause the Company
to convey to Harmony Institute by special warranty deed with covenant
against grantor's acts portions of the Property consisting of two
parcels of land (one on each side of US

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Highway 192/441) as depicted on the sketches attached hereto as
Schedule 29(a) hereto aggregating approximately one hundred acres of
land (herein individually referred to as a "Harmony Parcel" and
collectively referred to as the "Harmony Parcels"). As of the date
hereof, Purchaser has not yet completed its site planning in respect
of portions of the Property lying between US Highway 192/441 and the
respective Harmony Parcels. Purchaser shall, no later than the third

(3rd) anniversary of the Closing Date, cause the Company to execute
and deliver to Harmony Institute an access easement in form
reasonably acceptable to Purchaser and Harmony Institute for ingress
and egress between the Harmony Parcels and U.S. Highway Number
192/441, it being understood and agreed that temporary easements for
such ingress and egress shall be granted to the Harmony Institute and
its invitees over the areas indicated in the sketches attached as
Schedule 29(a) hereto. Purchaser shall be entitled to select such
commercially reasonable routes and areas of the Property over which
such easement will run as it shall reasonably determine, which will
describe by courses and distances, the easement areas of Harmony
Institute and containing certain other restrictions and covenants
(including a provision limiting to a period of four (4) years
following Closing, Harmony Institute's use of temporary stables on
the Harmony Parcels. As soon as is reasonably practicable after the
Closing Date, if not already done, Seller shall cause the Company to
have the Harmony Parcels designated as separate tax lots and to not
be part of any tax lot which contains any of the Property. From and
after the Closing Date until such tax division shall be effectuated,
the taxes allocable to the Harmony Parcels shall be allocated on a
pro rata basis according to the acreage of the parcels involved.
Seller and Harmony Institute shall, at their sole cost and expense
and at no cost or expense to Purchaser or the Company, cause the
Company to apply for and diligently pursue the receipt of all
necessary governmental subdivision, permits and approvals,
subdividing the Harmony Parcels from the remainder of the Property.

(mm) At Closing, Purchaser shall cause the Company to enter into an
agreement with the Harmony Institute in a form reasonably acceptable
to both of them (the "Veterinary Restriction Agreement"), pursuant to
which the Company shall agree that for a period of ten (10) years
commencing on the Closing Date, it will not establish or permit a
facility to be established on the Property for the provision of
veterinary services to homeowners at the Property (including without
limitation, Closed Unit/Site Purchasers). However, the Company is
permitted to establish an equestrian facility as an amenity to the
Property. Harmony Institute shall be granted an exclusive right to
establish a veterinary service facility within the Property, for a
period of ten (10) years commencing on the Closing Date, provided the
Harmony Institute begins such services as soon as certificates of
occupancy for 1500 residential units at the Property have been
issued. This exclusive right shall not prohibit the residents,
developers or anyone else within the Property from utilizing
veterinary services from providers other than Harmony Institute or
its assigns.

(nn) After Closing, Purchaser shall cause the Company to cooperate
with the Harmony Institute in conducting an annual golf tournament
for the benefit of the Harmony Institute. The Company shall donate
$7,500 in goods and services annually, subject to an annual inflation
rate, as long as the Company owns the golf facilities within the
Property.

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Lentz Agreement. On the Closing Date, the Company and James Lentz
shall enter into an Employment Agreement in the form of Exhibit J
hereto (the "Lentz Employment Agreement")

Harmony Name and Mark. Three E represents to Purchaser that it owns
all rights to the name "Harmony" and the mark identified on Schedule
31. On the Closing Date Three E and the Company shall execute and
deliver a License Agreement in reasonable form (the "Harmony
License") at no cost to the Company.

Contingency. Prior to the date hereof, the Company conducted
negotiations with certain parties (each, a "Prospective Purchaser")
for the sale of certain undeveloped land at the Property (the
"Offered Undeveloped Land"). If, after the expiration of the Due
Diligence Period and prior to the Closing Date (provided Purchaser
has not terminated this Agreement): (i) the Company from time to time
receives from a Prospective Purchaser, a contract for sale and
purchase for the Offered Undeveloped Land (a "Sale Contract") on
commercially reasonable terms and negotiated at arm's length executed
by the Prospective Purchaser, together with such downpayment or
deposit as may be required thereby; and (ii) the Company wishes to
enter into the Sale Contract, then the following procedure shall be
followed. Seller shall deliver a copy of the Sale Contract to
Purchaser, together with such information regarding the Prospective
Purchaser as shall be reasonably necessary for Purchaser to evaluate
the Prospective Purchaser. Seller shall, within two (2) Business Days
after request by Purchaser, deliver to Purchaser such additional
information concerning the Prospective Purchaser as Purchaser shall
reasonably require (collectively, the "Information"). Within five (5)
business days after Purchaser shall have received the information,
Purchaser shall advise Seller in writing whether the Sale Contract
and the terms thereof are acceptable to Purchaser. If Purchaser shall
fail to give timely notice to Seller, as aforesaid, then the Sale
Contract and the terms thereof shall be deemed acceptable to
Purchaser. If Purchaser shall advise that they are not, then
Purchaser may also, at its option, advise as to what changes would be
necessary in order for it to become acceptable to it. The Company may
elect to enter into a Sale Contract even if it is not acceptable to
Purchaser, in which case, Purchaser may elect to either (i) terminate
this Agreement whereupon the Downpayment with any interest earned
thereon shall be promptly paid over to Purchaser and Seller shall
reimburse Purchaser for its out-of-pocket costs in connection with
this Agreement and its due diligence, but not to exceed $50,000; or
(ii) to acquire the Partnership Interests notwithstanding the
Company's obligations under the Sale Contract (if closing of title
under a Sale Contract occurs prior to the Closing hereunder, the net
proceeds thereof shall, without increase of the Purchase Price
hereunder, remain with the Company [but subject to utilization by the
Company for operating expenses in the ordinary course of business]
through and following Closing hereunder such that Purchaser, rather
than Seller, shall receive the benefit thereof).

Lentz Lot Purchase Agreement. Purchaser acknowledges that Lentz
currently has an existing purchase/option agreement for a
single-family lot, 7B in the Drake Neighborhood within the Property
for One Hundred Twenty Thousand Dollars ($120,000) plus normal
closing fees

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and prorations which is expected to close on or before July 1, 2005
(the "Lentz Purchase Agreement"). Purchaser shall recognize and take
subject to all rights of Lentz under the Lentz Purchase Agreement.

Confidentiality.

(oo) Each of Seller and, until the day immediately following the
Closing Date following the consummation of the Closing by Purchaser,
Purchaser shall maintain all information received from the other and
the other's attorneys, accountants, representatives, agents and
contractors in strict confidence, and shall take precautions
reasonably necessary to prevent disclosure, access to, or
transmission of such information to any other third party, except as
provided in

(b) below or as may otherwise be required by law.

(pp) Except to the extent Purchaser and Seller shall otherwise agree
in writing, Purchaser, Seller and Lentz shall maintain
confidentiality as to the terms and conditions of this Agreement, as
well as to the terms of the sale of the Partnership Interests
contemplated hereby, except such disclosures to each party's
attorneys, accountants, consultants, lenders and others (including
third parties and applicable government agencies but only to the
extent required by applicable law or regulation) as such party deems
to be reasonably required in order to consummate the transactions
contemplated in this Agreement, or otherwise required by a court with
appropriate jurisdiction or other governmental authority. Purchaser
and Seller shall each instruct all others engaged by it in connection
with the transactions contemplated in this Agreement to abide by such
confidentiality provisions, and each shall be responsible for
violations by such third parties to whom it discloses such
information.

Purchaser's and Guarantor's Obligations to AJG Respecting the Bond
Indebtedness.

(qq) In consideration of AJG's agreement (which AJG hereby makes) to
leave in place the approximately Twelve Million Six Hundred Thousand
Dollar ($12,600,000) letter of credit posted by AJG to secure the
repayment of the Bond Indebtedness (the "Letter of Credit") on the
maturity date of November 1, 2010 (the "Maturity Date"), Purchaser
shall pay to AJG an annual fee of Ninety Thousand Dollars ($90,000)
each year from the Closing Date through the Maturity Date, which fee
shall be payable in equal quarterly installments on the last day of
each calendar quarter after the Closing Date, except for the first
and last such payment which shall be properly prorated based on the
number of days of the relevant quarter.

(rr) Purchaser shall not, and shall not permit the Company to, extend
the Maturity Date without a full and complete release and return of
the Letter of Credit to AJG.

(ss) From and after the Closing Date through the Maturity Date,
Guarantor shall maintain and/or have in cash or through one of the
following facilities, access to sums aggregating not less than the
face amount of the Letter of Credit: (i) cash on hand

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(or in a money market account) or (ii) the unrestricted right to call
for cash pursuant to Guarantor's subscription documents, which
Guarantor hereby agrees to call upon, if and when necessary for the
purposes of Section 35(e); or (iii) unrestricted availability under
Guarantor's credit agreements which Guarantor hereby agrees to draw
upon, if and when necessary for the purposes of Section 35(e).

(tt) Within thirty (30) days after the end of each calendar year
after the Closing Date a senior executive of Guarantor or its Chief
Financial Officer shall execute and deliver to AJG a duly dated
certificate attesting to the satisfaction of the financial
requirements described in Section 35(c) above and detailing the
manner in which such requirement was satisfied.

(uu) In the event of (i) any breach of the obligation set forth in
Section 35(a) above which is not cured within ten (10) Business Days
after written notice thereof given to Guarantor; or (ii) a breach of
Section 35(b) above or Sections 35(c) or (d) where the breach of
Section 35(c) or Section 35(d) is not cured within ten (10) Business
Days after written notice thereof given to Guarantor; or (iii) any
event under the Bond Indebtedness which results in a draw upon the
Letter of Credit then, within five (5) Business Days after written
demand therefor by AJG, Guarantor shall remit payment to AJG by wire
transfer of immediately available funds in an amount which is, in the
case of clauses (i) and (ii), equal to the amount of the Letter of
Credit and which is, in the case of clause (iii), equal to the amount
of the funds so drawn thereunder.

[SIGNATURE PAGE IMMEDIATELY FOLLOWS]

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

Company Subsidiaries: Seller:

HARMONY DEVELOPMENT CO., LLC THREE E CORPORATION

By: /s/ James L. Lentz By: /s/ James L. Lentz

Name: James L. Lentz Name: James L. Lentz
Title: President Title: President

HARMONY GOLF FACILITIES, LLC AJG FINANCIAL SERVICES, INC.

By: /s/ James L. Lentz By: /s/ Mark P. Strauch

Name: James L. Lentz Name: Mark P. Strauch
Title: President Title: Executive Vice President

Company:

BIRCHWOOD ACRES LIMITED

HARMONY RESTAURANT FACILITIES, LLC PARTNERSHIP, LLLP

By: /s/ James L. Lentz By: /s/ James L. Lentz

Name: James L. Lentz Name: James L. Lentz
Title: President Title: as President of
Three Corp., it's
General Partner

HARMONY GROUND MAINTENANCE CO., LLC

By: /s/ James L. Lentz

Name: James L. Lentz

Title: President

HARMONY REAL ESTATE CO., LLC.

By: /s/ James L. Lentz

Name: James L. Lentz

Title: President

46

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Three E Parent: Purchaser:

SOF-HARMONY FUNDING, L.L.C.

/s/ James L. Letz By: /s/ Robert Geimer

James Lentz Name: Robert Geimer
Title: Sr. Vice President

The undersigned Guarantors have executed this Agreement on April 20,
2005, to acknowledge and agree that they are jointly and severally
obligated for all obligations of Purchaser hereunder; provided,
however, no recourse for any such obligations shall extend to any
officer, director, employee, agent, representative, partner or member
of either such Guarantor and all liability of each such Guarantor
hereunder shall be limited to the assets of such Guarantor.

Guarantors

STARWOOD U.S. OPPORTUNITY SOF-VII U.S. HOLDINGS I, L.L.C.

FUND VII D-2, L.P.

By: SOF VII MANAGEMENT, L.L.C.,

its general partner

By: Starwood Capital Group Global, L.L.C., By:
/s/ Robert Geimer its General Manager

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

Name: Robert Geimer
Title: Senior Vice President

By: /s/ Robert Geimer

Name: Robert Geimer

Title: Senior Vice President

The Escrow Agent hereby acknowledges receipt of the Downpayment and
shall hold the same, including interest, if any, in escrow pursuant
to the provisions of this Agreement.

Escrow Agent:

FIRST AMERICAN TITLE INSURANCE COMPANY

By: /s/ Phillip Saloman

Name: Phillip Saloman
Title: Senior Vice President

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SCHEDULE 1

Certain Definitions

"Affiliates" means a Person or Persons, directly or indirectly,
through one or more intermediaries, controlling, controlled by or
under common control with the Person(s) in question. The term
"control", as used in the immediately preceding sentence, means, with
respect to a Person that is a corporation, the right to exercise,
directly or indirectly, more than fifty percent (50%) of the voting
rights attributable to the shares of the controlled corporation and,
with respect to a Person that is not a corporation, the possession,
directly or indirectly, of the power to direct or cause the direction
of the management or policies of the controlled Person.

"Benefit Plan" means any employee benefit or compensation plan,
program, policy, contract (whether or not written) or arrangement,
including any pension or retirement plan, deferred compensation plan,
vacation pay plan, stock option plan, bonus or incentive plan, change
in control agreement or plan, stock purchase plan, hospitalization,
disability or other insurance plan, employment agreement or
severance, retention or termination pay plan or policy, maintained,
sponsored, or contributed to by the Company or any Company Subsidiary
(including, for purposes of this definition, all employers (whether
or not incorporated) that would be treated together with the Company,
any Company Subsidiary and/or the Seller as a single employer within
the meaning of Section 414 of the Code) or with respect to which the
Company or any Company Subsidiary has any liability whether
contingent or otherwise.

"Books and Records" means, collectively, all of the books and records
of the Company and the Company Subsidiaries.

"Business Day" means any day other than a Saturday, Sunday or a day
on which banks in Orlando, Florida are authorized or obligated by
applicable law to close.

"Claim" or "Claims" means any and all claims, actions, proceedings,
suits, litigation, demands, obligations, liabilities, indebtedness,
breaches of contract, breaches of duty or any relationship, acts,
omissions, misfeasance, malfeasance, cause or causes of action, debt,
sums of money, accounts, compensation, contracts, controversies,
promises, damages, costs, losses, expenses or governmental or other
investigations including but not limited to, attorneys' and experts'
fees and expenses, and investigation and remediation costs whether
direct or indirect, known or unknown, foreseen or unforeseen.

"Code" means the Internal Revenue Code of 1986, as amended as it may
be further amended from time to time, any successor statute thereto,
and applicable U.S. Department of Treasury regulations issued
pursuant thereto in temporary or final form.

"Days" or "days" shall mean calendar days (as distinct from being
limited to those days which are Business Days).

"Environmental Laws" means all federal, and applicable state and
local laws, statutes, guidelines, codes, ordinances, regulations, now
or hereafter in effect, in each case as amended or supplemented from
time to time, including, without limitation, all applicable judicial
or administrative orders, applicable consent decrees and binding
judgments relating to the regulation and protection of human health,
safety, the environment and natural resources.

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"Existing Company" shall mean and refer to the Company prior to the
transfer of the Partnership Interests to Purchaser at the Closing.

"Hazardous Materials" shall mean (a) those substances included within
the definitions of any one or more of the terms "hazardous
materials", "hazardous wastes", "hazardous substances", "industrial
wastes", and "toxic pollutants", as such terms are defined under the
Environmental Laws, or any of them, (b) petroleum and petroleum
products, including, without limitation, crude oil and any fractions
thereof, (c) natural gas, synthetic gas and any mixtures thereof,

(d) asbestos and or any material which contains any hydrated mineral
silicate, including, without limitation, chrysotile, amosite,
crocidolite, tremolite, anthophylite and/or actinolite, whether
friable or non-friable, (e) polychlorinated biphenyl ("PCB") or
PCB-containing materials or fluids, (f) radon, (g) any pathogen,
toxin or other biological agent or condition including, without
limitation, any fungus, mold, mycotoxin or microbial matter naturally
occurring or otherwise, (h) any other hazardous or radioactive
substance, material, pollutant, contaminant or waste, and (i) any
other substance with respect to which any Environmental Law or
governmental authority requires environmental investigation,
monitoring or remediation.

"Knowledge of AJG" shall mean the actual conscious knowledge of any
of Mark Strauch, David long, Sally Wasikowski, Kerry Abbott, Douglas
K. Howell or Jack Lazzaro, without any duty of independent inquiry or
investigation.

"Knowledge of Three E" shall mean the actual conscious knowledge of
James Lentz, without any duty of independent inquiry or
investigation.

"Knowledge of Seller" shall mean the Knowledge of AJG or the
Knowledge of Three E.

"Permitted Encumbrances" means as relates to the Property: (a) any
lien imposed by law for Taxes, assessments or governmental charges
that are not delinquent and remain payable without penalty or that
are being contested in good faith by appropriate proceedings; (b) any
carrier's, warehousemen's, mechanic's, materialmen's, repairmen's or
other like lien imposed by law, arising in the ordinary course of
business and securing obligations that are not yet due and payable or
are being contested in good faith by appropriate proceedings; (c) any
pledge or deposit made in the ordinary course of business in
compliance with workers' compensation, unemployment insurance or
other social security laws or other statutory obligations of any
Seller or the Company; (d) any lien created by Purchaser; and (e) any
cash deposit or right of set-off to secure the performance of bids,
tenders, trade contracts, leases, statutory obligations, surety and
appeal bonds, performance bonds, government contracts and other
obligations of a like nature, in each case imposed in the ordinary
course of business.

"Permitted Exceptions" shall be:

(i) (X) Zoning and building restrictions, regulations, ordinances and
requirements heretofore or hereafter adopted by any governmental,
public or municipal authority

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having jurisdiction thereof, and amendments and additions thereto now
in force and effect, which relate to the Property and which do not
prohibit or materially interfere with the Company's present use and
Purchaser's contemplated use of the Property by the Company.

(Y) Such state of facts which an accurate survey would show, provided
such facts do not render title uninsurable.

(ii) Rights of tenants in possession (as tenants only) pursuant to
the Leases which are listed on Schedule 5(viii), any New Leases
entered into in accordance with the terms hereof and substances and
other occupancies thereunder.

(iii) Minor variations between tax lot lines and lines of record
title.

(iv) Rights, if any, of utility companies to lay, maintain, construct
and/or repair pipes, lines, conduits, cable boxes and other
installments on, under and across the Property for purposes of
providing utility services to the Land and the Building provided same
do not impose any monetary obligations on the owner of the property
and are similar relative to those over other properties in the
vicinity.

(v) Any agreements, financing statements, chattel mortgages, liens or
encumbrances entered into by, or arising from the acts of any Tenant
of the Property, which encumber only the Tenant's leasehold estate or
the Tenant's personal property in the Property.

(vi) Minor encroachments of stoop areas, roof cornices, sidewalk
elevators, window trims, cellar doors, steps, columns and column
bases, signs, piers, lintels, window sills, fire escapes, ledges,
fencing, coping, retaining walls and yard wall, if any, upon any
street or highway or adjoining property, as well as encroachments of
improvements located upon or belonging to this Property on adjoining
properties, provided the Title Company will affirmatively insure, at
regular rates, without additional premium, that the Building may
remain undisturbed.

(vii) The Violations, if and to the extent permitted by the express
terms of the Agreement.

(viii) The Underlying Obligations, if and to the extent they are
recorded in the government land records against the Property but in
the case of any of them which are mortgage liens, only to the extent
that they secure Assumed Indebtedness.

(ix) Anything which does not materially and adversely affect the
Company's ability to utilize and operate the Property as it is being
utilized and operated by the Company on the date hereof.

(x) The items excepted on the Company's title insurance Policy Number
OPM1520291 issued August 13, 1998 by Attorneys Title Insurance Fund,
Inc. and the mortgagee's title insurance policy issued to Franklin
Bank SSB by First American Title Insurance Company dated October 28,
2003 as policy number FA-36-517969 as amended

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by Endorsement Numbers 1, 2 and 3, respectively, dated December 8,
2003, October 18, 2004 and December 29, 2004) and any other items
placed of record by the Company subsequent to the date of issuance of
such title insurance policies, in the ordinary course of the
Company's business, in its interests, and consistent with its past
practice (but in the case of all of the above, including mortgage
liens only to the extent they secure Assumed Indebtedness) and, to
the extent not placed of record by the Company, only to the extent
the same shall not otherwise be prohibited by or result in a breach
of the provisions of this Agreement, and further, the Master Trust
Indenture and other instruments and agreements currently of record
relating to the 2004 Harmony Community Development District Capital
Improvement Bonds.

"Purchaser Designee" shall mean any entity which is an Affiliate of
Purchaser and which Purchaser shall, by notice given to Seller prior
to the Closing, designate to acquire title to any or all of the
Partnership Interests.

"Underlying Obligations" shall mean, collectively, all of those
obligations which are generally described on Schedule 5(xviii).

"Underlying Obligee" shall mean a party or entity to which the
Company has obligations under an Underlying Obligation.

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