BLUEGREEN CORP (Form: 10-K, Received: 03/03/2008 17:28:54)


		UNITED STATES
		SECURITIES AND EXCHANGE COMMISSION
		Washington, D.C. 20549

		FORM 10-K

	x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

		For the fiscal year ended December 31, 2007

		OR

	o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

		For the transition period from _________ to _________

		Commission file number 0-19292



		BLUEGREEN CORPORATION

		(Exact name of registrant as specified in its charter)


	Massachusetts	03-0300793

	(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

	4960 Conference Way North, Suite 100, Boca Raton, Florida 33431

	(Address of principal executive offices) (Zip Code)

	Registrant’s telephone number, including area code: (561) 912-8000

	Securities Registered Pursuant to Section 12(b) of the Act:

	Title of each class	Name of each exchange on which registered


	Common Stock, $.01 par value	New York Stock Exchange

	Securities Registered Pursuant to Section 12(g) of the Act: None.

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Yes o No x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
Yes o No x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes x No o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in the definitive proxy statement incorporated by reference into Part III of this Form 10-K. x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company (as defined in Rule 12b-2 of the Act).


	Large Accelerated filer o		Accelerated filer x

	Non-Accelerated filer o		Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).
Yes o No x

State the aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant: $145,316,169 based upon the closing sale price of the Company’s Common Stock on the New York Stock Exchange on June 30, 2007 ($11.69 per share). For this purpose, “affiliates” include members of the Board of Directors of the Company, members of executive management and all persons known to be the beneficial owners of more than 10% of the Company’s outstanding common stock.

As of February 27, 2008, there were 31,605,748 shares of the registrant’s common stock, $.01 par value, outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Specifically identified portions of the Company’s definitive proxy statement to be filed for its 2008 Annual Meeting of Shareholders (the “Proxy Statement”) are incorporated by reference into Part III hereof.

BLUEGREEN CORPORATION

INDEX TO ANNUAL REPORT ON FORM 10-K


	PART I	Page

Item 1.	BUSINESS	1

Item 1A.	RISK FACTORS	26

Item 1B.	UNRESOLVED STAFF COMMENTS	32

Item 2.	PROPERTIES	32

Item 3.	LEGAL PROCEEDINGS	32

Item 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS	34

	PART II

Item 5.	MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES	35

Item 6.	SELECTED FINANCIAL DATA	37

Item 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	39

Item 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	65

Item 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA	66

Item 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	112

Item 9A.	CONTROLS AND PROCEDURES	112

Item 9B.	OTHER INFORMATION	112

	PART III

Item 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE	113

Item 11.	EXECUTIVE COMPENSATION	113

Item 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS	113

Item 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE	113

Item 14.	PRINCIPAL ACCOUNTING FEES AND SERVICES	113

	PART IV

Item 15.	EXHIBITS, FINANCIAL STATEMENT SCHEDULES	114

SIGNATURES		115

EXHIBIT INDEX		117

TRADEMARKS

The terms “Bluegreen®,” “Bluegreen Communities®,” “Bluegreen Vacation Club®,” “Colorful Places To Live And Play®,” “You’re Going To Like What You See!®,” “Encore Rewards®,” “Outdoor Traveler Logo®,” and the “Bluegreen Logo®” are registered in the U.S. Patent and Trademark Office by Bluegreen Corporation.

The terms “The Hammocks at Marathon™,” “Orlando’s Sunshine Resort™,” “Solara Surfside™,” “Mountain Run at Boyne™,” “The Falls Village™,” “Bluegreen Wilderness Club™,” “The Lodge Alley Inn™,” “Carolina Grande™,” “Harbour Lights™,” “Patrick Henry Square™,” “SeaGlass Tower™,” “Shore Crest Vacation Villas™,” “Laurel Crest™,” “MountainLoft™,” “MountainLoft Resort II™,” “Daytona SeaBreeze™,” “Shenandoah Crossing™,” “Christmas Mountain Village™,” “Traditions of Braselton™,” “Sanctuary Cove at St. Andrews Sound™,” “Sanctuary River Club at St. Andrews Sound™,” “Catawba Falls Preserve™,” “Chapel Ridge™,” “Mountain Lakes Ranch™,” “Silver Lakes Ranch™,” “Mystic Shores™,” “Lake Ridge™,” “Lake Ridge at Joe Pool Lake™,” “Ridge Lake Shores™,” “Quail Springs Ranch™,” “SugarTree at the Brazos™,” “Mountain Springs Ranch™,” “Havenwood at Hunter’s Crossing ^TM ,” “Vintage Oaks at the Vineyard™,” “King Oaks™,” “The Bridges at Preston Crossings™,” “Crystal Cove™,” “Fairway Crossings™,” “Woodlake™,” “Saddle Creek Forest™,” “The Settlement at Patriot Ranch™,” “Carolina National™,” “Brickshire™,” “Golf Club at Brickshire™,” “Preserve at Jordan Lake™,” “Encore Dividends™,” “Bluegreen Preferred™,” “BG Pirates Lodge™,” “Bluegreen Traveler Plus™,” and “Bluegreen Wilderness Traveler at Shenandoah™,” are trademarks or service marks of Bluegreen Corporation in the United States.

The terms “Big Cedar®” and “Bass Pro Shops®” are registered in the U.S. Patent and Trademark Office by Bass Pro Trademarks, LP.

The term “World Golf Village®” is registered in the U.S. Patent and Trademark Office by World Golf Foundation, Inc. All other marks are registered marks of their respective owners.

MARKET AND INDUSTRY DATA

Market and industry data used throughout this Annual Report on Form 10-K were obtained from our internal surveys, industry publications, unpublished industry data and estimates, discussions with industry sources and currently available information. The sources for this data include, without limitation, the American Resort Development Association (“ARDA”). Industry publications generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy and completeness of such information. We have not independently verified such market data. Similarly, our internal surveys, while believed by us to be reliable, have not been verified by any independent sources. Accordingly, no assurance can be given that any such data will prove to be accurate.

PART I


Item 1.	BUSINESS.

Introduction

We are a leading provider of colorful places to live and play through our resorts and residential community businesses. We are organized into two divisions: Bluegreen Resorts and Bluegreen Communities. Bluegreen Resorts acquires, develops and markets vacation ownership interests (“VOIs”) in resorts generally located in popular high-volume, “drive-to” vacation destinations. Bluegreen Communities acquires, develops and subdivides property and markets residential land homesites, the majority of which are sold directly to retail customers who seek to build a home in a high quality residential setting, in some cases on properties featuring a golf course and related amenities. In 2007, Bluegreen Resorts comprised 78% of our sales while Bluegreen Communities represented 22% of sales. We also generate significant interest income through our financing of individual purchasers of VOIs and, to a nominal extent, homesites sold by Bluegreen Communities.

Bluegreen Resorts

Bluegreen Resorts was founded in 1994 to capitalize on the growth of the vacation ownership industry. As of December 31, 2007, we had approximately 185,100 VOI owners, including approximately 151,100 members in the Bluegreen Vacation Club, which was established in 1997. We sell VOIs in the Bluegreen Vacation Club at 21 sales offices located at our resorts located in the United States and Aruba; at our seven off-site sales offices in Atlanta, Georgia; Indianapolis, Indiana; Chicago, Illinois; Detroit, Michigan; Minneapolis, Minnesota; Las Vegas, Nevada; and Dallas, Texas; and a sales office located on the campus of one resort under development located in Williamsburg, Virginia. A deeded real estate interest in a Bluegreen Vacation Club VOI in any of our resorts entitles the buyer to an annual or biennial allotment of “points” in perpetuity. Club members may use their points to stay in one of our 23 Bluegreen Vacation Club Core Resorts and 22 other resorts or for other vacation options, including cruises and stays at approximately 3,700 resorts offered through Resort Condominiums International, LLC (“RCI”), an external exchange network. Club members who acquired or upgraded their VOIs on or after November 1, 2007 also have access to 18 Shell Vacation Club (“Shell”) resorts, through our Select Connections™ joint venture with Shell. Shell is an unaffiliated privately-held resort developer. The following table lists the Bluegreen Vacation Club resorts:


Bluegreen Vacation Club Core Resorts (1)(2)		Location

Daytona SeaBreeze (3)		Daytona Beach Shores, Florida
The Hammocks at Marathon (3)		Marathon, Florida
The Fountains (3)		Orlando, Florida
Orlando’s Sunshine Resort I & II (3)		Orlando, Florida
Casa del Mar Beach Resort		Ormond Beach, Florida
Grande Villas at World Golf Village (3)		St. Augustine, Florida
Solara Surfside (3)		Surfside, Florida
Mountain Run at Boyne (3)		Boyne Falls, Michigan
The Falls Village (3)		Branson, Missouri
Bluegreen Wilderness Club at Big Cedar (3)(4)		Ridgedale, Missouri
The Suites at Hershey (3)		Hershey, Pennsylvania
The Lodge Alley Inn (3)		Charleston, South Carolina
Carolina Grande (3)		Myrtle Beach, South Carolina
Harbour Lights (3)		Myrtle Beach, South Carolina
SeaGlass Tower (3)		Myrtle Beach, South Carolina
Shore Crest Vacation Villas I & II (3)		North Myrtle Beach, South Carolina
MountainLoft (3)		Gatlinburg, Tennessee
Laurel Crest (3)		Pigeon Forge, Tennessee
Shenandoah Crossing (3)		Gordonsville, Virginia
Bluegreen Wilderness Traveler at Shenandoah (3)		Gordonsville, Virginia
Bluegreen Odyssey Dells (3)		Wisconsin Dells, Wisconsin
Christmas Mountain Village (3)		Wisconsin Dells, Wisconsin
La Cabana Beach and Racquet Club (5)		Oranjestad, Aruba


Other Resorts (1)		Location

Paradise Isle Resort		Gulf Shores, Alabama
Shoreline Towers Resort		Gulf Shores, Alabama
Via Roma Beach Resort (3)		Bradenton Beach, Florida
Dolphin Beach Club (3)		Daytona Beach Shores, Florida
Fantasy Island Resort II (3)		Daytona Beach Shores, Florida
Mariner’s Boathouse and Beach Resort		Fort Myers Beach, Florida
Tropical Sands Resort		Fort Myers Beach, Florida
Windward Passage Resort		Fort Myers Beach, Florida
Gulfstream Manor (3)		Gulfstream, Florida
Resort Sixty-Six (3)		Holmes Beach, Florida
Outrigger Beach Club (3)		Ormond Beach, Florida
Landmark Holiday Beach Resort		Panama City Beach, Florida
Ocean Towers Beach Club		Panama City Beach, Florida
Panama City Resort & Club		Panama City Beach, Florida
Surfrider Beach Club		Sanibel Island, Florida
Petit Crest Villas at Big Canoe		Marble Hill, Georgia
Pono Kai Resort (3)		Kapaa (Kauai), Hawaii
Lake Condominiums at Big Sky		Big Sky, Montana
Foxrun Townhouses		Lake Lure, North Carolina
Sandcastle Village II		New Bern, North Carolina
Waterwood Townhouses		New Bern, North Carolina
Players Club		Hilton Head Island, South Carolina


(1)	Throughout this Annual Report on Form 10-K (“Annual Report”), any reference to “core” resorts refers to resorts where we acquired or developed a significant number of the VOIs associated with the resorts, even if substantially all of the VOIs in the property have been sold to consumers. “Other Resorts” refer to component sites within the Bluegreen Vacation Club where we did not acquire or develop a significant number of the VOIs associated with the resorts.

(2)	The table excludes acquisitions of vacation ownership resorts made during 2006 and 2007, including property located in Las Vegas, Nevada; Newland, North Carolina; Williamsburg, Virginia; and Ridgedale, Missouri. Occupancy in these resorts is expected following completion of construction and development activities at each of these resort locations.

(3)	This resort is managed by Bluegreen Resorts Management, Inc., one of our wholly-owned subsidiaries.

(4)	This resort is being developed, marketed and sold by Bluegreen/Big Cedar Vacations, LLC, a joint venture with Big Cedar, LLC. We own a 51% interest in this joint venture and the joint venture’s results of operations, cash flows and financial position are included in our consolidated financial statements. See Note 1 of the Notes to Consolidated Financial Statements.

(5)	This resort is managed by Casa Grande Cooperative Association I, which has subcontracted with Bluegreen Resorts Management, Inc. to provide management consulting services to the resort.

Throughout this Annual Report, “estimated remaining life-of-project sales” assumes the aggregate sales of the existing, currently under construction or development, and planned VOIs or homesites, at current retail prices. “Field Operating Profit” means the operating profit of one of our business segments prior to the allocation of corporate overhead, interest income, other income and expense items, interest expense, minority interest, provision for income taxes, and cumulative effect of change in accounting principle. See Note 19 of the Notes to Consolidated Financial Statements for further information and a reconciliation of Field Operating Profit for our business segments to consolidated income before provision for income taxes.

Since our inception, we have generated over 262,000 VOI sales transactions. Bluegreen Resorts’ estimated remaining life-of-project sales were approximately $2.7 billion at December 31, 2007. For the year ended December 31, 2007, Bluegreen Resorts recognized Sales and Field Operating Profit of $453.5 million and $69.9 million, respectively.

Bluegreen Resorts uses a variety of techniques to attract prospective purchasers of VOIs, including marketing of mini-vacations either through face-to-face contact at kiosks in retail and leisure locations or through telemarketing

campaigns, marketing to current owners of VOIs and referrals. To support our marketing and sales efforts, we have sought to develop a database to track our vacation ownership marketing and sales programs. We believe that as our vacation ownership operations grow, this database will position us to take advantage of, among other things, less costly marketing and referral opportunities.

While historical growth rates may not continue, based on ARDA and other industry data, we believe that vacation ownership has been one of the fastest growing segments of the hospitality industry with growth in sales volume between 2005 and 2006 at 16%. Annualized growth year-over-year from 1995 to 2006 was 16%. The number of U.S. households owning timeshare interests grew from 4.1 million to 4.4 million from 2005 to 2006. According to ARDA, the primary reasons cited by consumers for purchasing a VOI is the overall flexibility of the various products, the quality of the accommodations, the credibility of the timeshare company, and internal and external exchange opportunities through worldwide exchange networks. Our affiliation with RCI, the largest worldwide vacation ownership exchange company, entitles members of the Bluegreen Vacation Club to stay at approximately 3,700 participating RCI resorts located in over 100 countries worldwide.

Our Bluegreen Vacation Club system permits our VOI owners to purchase a real estate timeshare interest which provides them with an annual or biennial allotment of points, which can be redeemed for occupancy rights at Bluegreen Vacation Club resorts. We believe the Bluegreen Vacation Club allows our VOI owners to customize their vacation experience in a more flexible manner than traditional fixed-week vacation ownership programs. We also offer a Sampler Program, which allows Sampler package purchasers to enjoy substantially the same amenities, activities and services offered to Bluegreen Vacation Club members during a one-year trial period. We believe that we benefit from the Sampler Program as it gives us an opportunity to market our VOIs to customers when they use their trial memberships at our resorts and to recapture some of the cost incurred relative to the initial marketing of prospective customers.

Prior to acquiring a property for a resort, Bluegreen Resorts undertakes a property review of a resort location for potential acquisition including physical and environmental assessments. This review is presented for approval to our Management Investment Committee which consists of certain key members of senior management. Once approved by this committee, the acquisition is submitted to the Investment Committee of our Board of Directors for final approval. During the review process, we generally consider market, tourism and demographic data as well as the quality and diversity of the location’s existing amenities and attractions to determine the potential strength of the vacation ownership market in the area and the availability of a variety of recreational opportunities for prospective VOI purchasers. Another important consideration of potential acquisition is the demand for resorts in specific geographic areas by existing Bluegreen Vacation Club members. We periodically monitor this demand through surveys and other means. We generally seek to acquire real estate or interests in real estate in markets that will provide incremental sales distribution opportunities and/or satisfy our existing Bluegreen Vacation Club members’ desires for alternate vacation destinations. No assurance can be given that we will be successful in our acquisition strategy.

We have historically provided financing to approximately 95% of our vacation ownership customers. Customers are required to make a down payment of at least 10% of the VOI sales price and typically finance the balance of the sales price over a period of ten years. As of December 31, 2007, our on-balance sheet vacation ownership receivables portfolio totaled approximately $172.8 million in principal amount, however, as of that date we serviced $817.5 million of VOI receivables as most have been sold without recourse off-balance sheet. During the year ended December 31, 2007, we maintained vacation ownership receivables warehouse facilities and separate vacation ownership receivables purchase facilities to maintain liquidity associated with our vacation ownership receivables. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources” for a further discussion of our vacation ownership receivables facilities and certain risks relating to such facilities. As discussed in more detail in Note 1 and Note 2 of the Notes to Consolidated Financial Statements, on January 1, 2006, the Company adopted the Financial Accounting Standards Board (“FASB”) Statement of Financial Accounting Standards (“SFAS”), SFAS No. 152, Accounting for Real Estate Time-Sharing Transactions (“SFAS No. 152”). SFAS No. 152, among other things, clarified the 10% down payment computation as it applies to revenue recognition.

Bluegreen Communities

Bluegreen Communities focuses on developing residential homesites near major metropolitan centers or popular retirement areas. We believe that a majority of our Bluegreen Communities customers seek a lifestyle that may not be available in traditional, intensely subdivided suburban developments. As of December 31, 2007, Bluegreen Communities was actively developing and selling homesites directly to retail consumers in communities primarily located in Texas, Georgia, North Carolina, and Virginia. Bluegreen Communities had $146.0 million of inventory as of December 31, 2007, and Bluegreen Communities’ estimated remaining life-of-project sales were approximately $487.0

million. For the year ended December 31, 2007, Bluegreen Communities recognized Sales and Field Operating Profit of $129.2 million and $23.6 million, respectively.

The objective of our communities marketing and sales program is to generate on-site sales presentations to potential prospects attracted through a combination of newspaper, direct mail, television, billboard, Internet and radio advertising. In addition, Bluegreen Communities’ utilizes a customer relationship management computer software system which we believe assists us in compiling, processing, and maintaining information concerning future sales prospects within each of our operating regions. Our conversion ratio of sales to prospects receiving on-site presentations was 26% in 2007. We believe that we have been able to achieve an attractive conversion ratio of sales to prospects receiving on-site sales presentations, through these programs.

Bluegreen Communities seeks to acquire and develop land near major metropolitan centers, but outside the perimeter of intense subdivision development, and in popular retirement areas. Prior to acquiring undeveloped land, we generally consider market depth and attempt to forecast market absorption. In new market areas, we typically engage a third-party to perform a market study in the area to evaluate market response and price acceptance. Our sales and marketing efforts begin as soon as practicable after we enter into an agreement to acquire a parcel of land. By bonding a project to completion and /or providing a corporate guaranty, it may be possible to sell a portion of our residential land inventory on a pre-development basis, thereby reducing the amount of external capital needed to complete improvements. As is the case with Bluegreen Resorts, all acquisitions of properties by Bluegreen Communities are subject to the approval of both our Management Investment Committee and the Investment Committee of our Board of Directors.

In fiscal 1997, we began construction of our first daily-fee golf course and to date have developed eight daily fee golf courses. We believe that daily-fee golf courses are an attractive amenity that increases the marketability of adjacent homesites. We hope to expand our golf course community residential land offerings into markets with attractive demographics for such properties, but there is no assurance that our strategy for this expansion or the operation of the golf courses will be successful.

Industry Overview

Bluegreen Resorts

The Market. The resorts component of the leisure industry is serviced primarily by two separate alternatives for overnight accommodations: commercial lodging establishments and vacation ownership resorts. Commercial lodging consists principally of hotels and motels in which a room is rented on a nightly, weekly or monthly basis for the duration of the visit or rentals of privately-owned condominium units or homes. For many vacationers, particularly those with families, a lengthy stay at a quality commercial lodging establishment can be expensive, and the space provided to such vacationers by these establishments relative to the cost is often not economical. In addition, room rates at commercial lodging establishments are subject to change periodically and availability is often uncertain. We believe that vacation ownership presents an attractive vacation alternative to commercial lodging.

First introduced in Europe in the mid-1960’s, vacation ownership has been one of the fastest growing segments of the hospitality industry over the past two decades. We believe that, based on ARDA reports and other industry data, the following factors have contributed to the increased acceptance of the vacation ownership concept among the general public and the substantial growth of the vacation ownership industry:


	•	growing consumer awareness of the potential value and benefits of vacation ownership, including the cost savings relative to certain other lodging alternatives;

	•	increasing flexibility of vacation ownership due to the growth of international exchange organizations such as RCI and Interval International, and points-based vacation club systems such as the Bluegreen Vacation Club;

	•	the improving quality of the vacation ownership resorts and their management; and

	•	growing consumer confidence resulting from enhanced consumer protection regulation of the vacation ownership industry and the entry of brand name national lodging companies to the vacation ownership industry.

Historically, the vacation ownership industry was highly fragmented and dominated by a large number of local and regional resort developers and operators, each with small resort portfolios generally of differing quality. We believe that one of the most significant factors contributing to the current success of the vacation ownership industry has been the entry into the market of some of the world’s major lodging, hospitality and entertainment companies, such as Marriott International, Inc., the Walt Disney Company, Hilton Hotels Corporation, Hyatt Corporation, Four Seasons Hotels and

Resorts, Starwood Hotels and Resorts Worldwide, Inc., and Wyndham Worldwide Corporation. Although vacation ownership operations currently comprise only a portion of these companies’ overall operations, we believe that their involvement in the vacation ownership industry has enhanced the industry’s image with the general public.

Our Bluegreen Vacation Club resorts are primarily “drive-to” resort destinations, meaning that we believe that most of our VOI owners live within a 300 mile drive of at least one of our resorts. We believe that, in general, Americans still desire to take family vacations and that our vacation club is positioned to benefit from consumer demand for family vacations. However, economic conditions and the rising cost of gasoline may have an adverse effect on the demand for vacations and our operations in the future.

The Consumer. According to information compiled by various sources, we believe our typical customer to be married and 45-54 years of age, with a household median income of approximately $74,000. According to the U.S. Census, the 45 to 54 year old age group was expected to grow 18% from 2000 through 2010 and we believe we benefit from this growth. Despite the industry’s growth, VOI ownership has achieved only an approximate 5% market penetration among United States households with incomes above $50,000 per year.

VOI Ownership. The purchase of a fixed-week VOI typically entitles the buyer to use a fully-furnished vacation residence, generally for a one-week period each year in perpetuity. Typically, the buyer acquires an ownership interest in the vacation residence, which is often held as a tenant-in-common with other buyers of interests in the property. We believe this traditional vacation ownership product lacks the flexibility provided to owners of a points-based vacation ownership product, and hence we have not sold fixed week VOIs for several years. Since January 2004, all of our sales offices have only sold VOIs within our Bluegreen Vacation Club system, although all but one of our sales offices have been selling the points product since 2000.

Under a points system, such as our Bluegreen Vacation Club, the members purchase a real estate interest in a specific VOI resort, which is held in trust on the member’s behalf and provides the member with an annual or biennial allotment of points that can be redeemed for occupancy rights at participating resorts. We believe that compared to other vacation ownership arrangements, the points system offers members greater flexibility in planning their vacations. Members can stay for varying lengths of time on vacations for as little as 2 nights and as many nights as their points will allow on any one vacation. The number of points required for a stay at any one resort varies depending on a variety of factors including the resort location, the size of a unit, the vacation season and the days of the week used. Under this system, members can select vacations according to their schedules, space needs, available inventory, and available points. Members’ unused points are typically automatically saved for one year beyond the year they were allotted, subject to certain usage restrictions. Members also typically may “borrow” points from the next year, subject to certain restrictions and pre-payment of owner’s maintenance fees.

The owners of VOIs manage the property through a nonprofit homeowners’ association that is governed by a board of directors or trustees, consisting of representatives of the developer (so long as the developer owns VOIs in the resort or as otherwise provided by law) and owners of VOIs at the resort. The board hires a management company to which it delegates many of the rights and responsibilities of the homeowners’ association, including grounds landscaping, security, housekeeping and operating supplies, garbage collection, utilities, insurance, laundry and repairs and maintenance. As of December 31, 2007, we managed 29 resorts, including 28 of the resorts in the Bluegreen Vacation Club.

Each VOI owner is required to pay a share of all costs of maintaining the properties in the Bluegreen Vacation Club system. These charges generally consist of an annual maintenance fee plus applicable real estate taxes and special assessments, assessed on an as-needed basis. If the VOI owner does not pay such charges, such owner’s use rights in Bluegreen Vacation Club may be suspended and the homeowners’ association may foreclose on the owner’s VOI, subject to our first mortgage lien on the VOI, if any.

Participation in Independent VOI Exchange Networks. We believe that our VOIs are made more attractive by our affiliation with an international VOI exchange network such as RCI. All of our VOI resorts are currently affiliated with RCI, and most of our core resorts have been awarded RCI’s highest designation (Gold Crown). A VOI owner’s participation in the RCI exchange network allows such owner to exchange his annual VOI for occupancy at approximately 3,700 participating resorts, based upon availability and the payment of a variable exchange fee. RCI’s participating resorts are located throughout the world in over 100 countries. A Bluegreen Vacation Club owner may make a reservation for occupancy in a Bluegreen Vacation Club VOI and then may attempt to exchange this occupancy right for one in another participating RCI resort. The owner lists his occupancy right as available with RCI and requests occupancy at another participating resort, indicating the particular resort or geographic area to which the owner desires to travel, the size of the unit desired and the period during which occupancy is desired. The exchange network assigns ratings to each listed VOI, based upon a number of factors, including the location and size of the unit, the quality of the

resort and the period during which the VOI is available, and attempts to satisfy the exchange request by providing an occupancy right in another VOI with a similar rating. If the exchange network is unable to meet the member’s initial request, it suggests alternative resorts based on availability. If the owner consummates the exchange, they are charged an exchange fee by RCI. No assurance can be given that our resorts will continue to qualify for participation in international exchange networks, or that our customers will continue to be satisfied with these networks. Our failure or the failure of any of our resorts to participate in qualified exchange networks or the failure of such networks to operate effectively could have a material adverse effect on us. In 2007, only 7% of our owners utilized the RCI exchange network. Additionally, Bluegreen Vacation Club members may use their points for hotel stays with World Hotels or various cruise vacations.

In September 2007, we entered into an agreement with Shell Vacations Club to create a joint venture called Select Connections™. Select Connections™ provides certain Bluegreen Vacation Club owners who purchased or upgraded their VOI ownership since November 1, 2007, with the ability to use their vacation points to reserve accommodations in approximately 18 Shell Vacation Club locations for a nominal fee. The Select Connections™ joint venture also provides members of Shell Vacation Club access to Bluegreen Resorts.

Bluegreen Communities

We believe that Bluegreen Communities operates within a specialized niche of the real estate industry that focuses on the sale of residential homesites to retail customers who typically intend to build a custom home on such homesites at some point in the future. The participants in this market are generally individual landowners who are selling specific parcels of property for development by others and small developers who focus primarily on projects in their region.

Unlike commercial homebuilders who focus on vertical development, such as the construction of single and multi-family housing structures, Bluegreen Communities focuses primarily on horizontal development activities, such as grading, roads and utilities. As a result, the projects undertaken by us are less capital intensive than those generally undertaken by commercial homebuilders. We believe that our market is also the beneficiary of a number of trends, including the large number of people in the 40 to 59 year old age bracket and the economic and population growth in certain of our primary markets.

Bluegreen Communities also focuses on the development of daily-fee golf courses and related amenities as the centerpieces of certain of our residential land communities. As of December 31, 2007, we were marketing homesites in eight communities that include golf courses developed either by us or third parties. We currently intend to acquire and develop additional golf communities, as we believe that the demographics and marketability of such properties are consistent with our overall residential land strategy. Golf communities typically are larger, multi-phase properties that require a greater capital commitment than our single-phase residential land projects, but which also typically realize higher gross margins. There can be no assurance that we will be able to successfully implement our golf community strategy.

Bluegreen Communities also undertakes the development of large lakes in certain of our projects as the centerpiece amenity. We believe that while these development activities require a greater capital commitment than certain other amenities that we may provide in our communities, we benefit from the anticipated increased marketability and pricing of lakefront homesites.

Company Products

Bluegreen Resorts

Set forth below is a description of each of our core vacation ownership resorts. We consider resorts as “core” if we acquired or developed a significant number of the VOIs associated with the resorts. Units at most of the properties have amenities including a full kitchen, two televisions, a DVD and a CD player, big screen televisions, fireplaces, whirlpool tubs, and video game systems. Most properties offer guests a clubhouse (with an indoor or outdoor pool, a game room, exercise facilities and a lounge) and a hotel-type staff. We manage all of our owned resorts, either directly or through a subcontract, with the exception of the Casa del Mar Beach Resort. The Casa del Mar Beach Resort is managed by The Amber Group, Inc., an unaffiliated third party that managed the resort prior to our acquisition of Casa del Mar’s unsold VOI inventory in 2003.

Florida

Daytona SeaBreeze — Daytona Beach Shores, Florida. This 80-unit resort is located on the “World’s Most Famous Beach.” Amenities include private ocean-front balconies, a heated outdoor swimming pool, a children’s pool, a hot

tub, a fitness center, barbeque grill area and a game room. The resort is on a barrier island less than six miles long and is located near the world-famous Daytona International Speedway and DAYTONA USA®.

The Hammocks at Marathon — Marathon, Florida . The Hammocks at Marathon is located in the Florida Keys within easy reach of both Miami and Key West, Florida. This 58-unit beachfront resort offers such amenities as a pool, boat slips, an outside tiki bar and a variety of water sport recreational vehicle rentals.

The Fountains — Orlando, Florida. This 54-acre resort is located on Lake Eve and is minutes away from Central Florida’s family attractions, including Walt Disney World®, SeaWorld® and Universal Studios®. Amenities include a clubhouse with a heated indoor/outdoor swimming pool, a pool bar, a massage room, steam and sauna rooms, a family activity room, a tennis court, a basketball court, and a resort style pool facility. When fully developed, we anticipate that the Fountains will include 754 units, as well as an on-site Domino’s Pizza® and a Benihana Japanese restaurant.

Orlando’s Sunshine Resort — Orlando, Florida. Orlando’s Sunshine Resort is located on International Drive, near Wet’n’Wild® water park and Universal Studios Florida®. This 90-unit property features an outdoor swimming pool, a hot tub and tennis courts.

Casa del Mar Beach Resort — Ormond Beach, Florida. Casa del Mar is a 43-unit resort located directly on the ocean and includes an outdoor pool and miniature golf. In nearby Daytona Beach, Florida guests can drive on the beach or visit the Daytona International Speedway.

Grande Villas at World Golf Village — St. Augustine, Florida. Grande Villas is located approximately 30 minutes away from the Atlantic Ocean and next to the World Golf Hall of Fame®. This resort features an extensive array of amenities, including a golf course (separately owned and operated; separate fee required), outdoor and indoor swimming pools, a hot tub, a sauna and a playground. The resort includes 152 units.

Solara Surfside — Surfside, Florida. This 58-unit oceanfront resort is located in Surfside, Florida, near Miami Beach. Solara Surfside captures the art deco style of its surrounding area and features one- and two-bedroom vacation units, a swimming pool, a sun deck and a hot tub.

Michigan

Mountain Run at Boyne — Boyne Falls, Michigan. Boyne Mountain is known for skiing, snowboarding and tubing on more than 50 runs with convenient lift and trail systems. In the summer, Boyne Mountain offers golf on nearby world-class courses designed by some of the game’s masters, including Robert Trent Jones, Arthur Hills, Donald Ross and others. Mountain Run has 104 units. Amenities for winter and summer use are separately owned and operated.

Missouri

The Falls Village — Branson, Missouri. The Falls Village is located near the Ozark Mountains. Fishing, boating and swimming are available at nearby Table Rock Lake and Lake Taneycomo, and area theaters feature shows by renowned country music stars. Most resort guests come from areas within an eight to ten hour drive of Branson. When fully developed, we anticipate that this resort will include 240 units.

Bluegreen Wilderness Club at Big Cedar — Ridgedale, Missouri. The Bluegreen Wilderness Club at Big Cedar is a wilderness-themed resort adjacent to the world famous Big Cedar Lodge luxury hotel resort. This vacation ownership resort is being developed, marketed and sold by Bluegreen/Big Cedar Vacations, LLC, a joint venture between Big Cedar, LLC and us, in which we own a 51% interest. The resort is located on Table Rock Lake, and is near Dogwood Canyon. Guests staying in the two-bedroom cabins or one- and two-bedroom lodge villas enjoy fireplaces, private balconies, full kitchens and Internet access. Amenities include, or are expected to include, indoor and outdoor swimming pools and hot tubs, a lazy river, hiking trails, a campfire area, a beach and playground. Guests also have access to certain of the luxury amenities at the Big Cedar Lodge, including the Jack Nicklaus Signature Top of the Rock Par Three Golf Course, a marina, horseback riding, tennis courts and a spa. When fully developed, we anticipate that this resort will include 324 units.

Pennsylvania

The Suites at Hershey — Hershey, Pennsylvania. This 3.2-acre, 79 unit resort is located near HersheyPark® and Hershey’s® Chocolate World. Amenities include an outdoor swimming pool, a hot tub, a playground, a picnic area with barbeque grills, a game room, a fitness center and indoor basketball courts.

South Carolina

The Lodge Alley Inn — Charleston, South Carolina. Located in Charleston’s historic district, The Lodge Alley Inn includes one- and two-bedroom suites, many furnished with an equipped kitchen, a living room with a fireplace, a dining room, a whirlpool bath, pine wood floors and 18th century-style furniture reproductions. This 90-unit resort, which features the on-site High Cotton restaurant, is within walking distance of many of Charleston’s historical sites, open-air markets and art galleries.

Carolina Grande — Myrtle Beach, South Carolina. This 118 unit, 20-story tower is located across the street from the beach. An arrangement with The Carolinian Beach Resort offers guests an accessible breezeway directly to the beach and other amenities, including indoor and outdoor swimming pools, hot tubs, full kitchens, washers and dryers, and views of the ocean and city from each room. The resort is located near the Pavilion Amusement Park, NASCAR® SpeedPark, Broadway at the Beach ^SM (a 350-acre complex featuring approximately 100 specialty shops, 20 restaurants, 15 attractions and 10 nightclubs), Myrtle Waves Water Park, Carolina Opry, Dixie Stampede and the Convention Center.

Harbour Lights— Myrtle Beach, South Carolina. Harbour Lights is located in the Fantasy Harbour Complex in the center of Myrtle Beach. Nearby are Theater Row, shopping, golf courses and restaurants. The resort’s activities center overlooks the Intracoastal Waterway. When fully developed, we anticipate that this resort will include 344 units.

SeaGlass Tower — Myrtle Beach, South Carolina. The SeaGlass Tower is a 19-story, 144 unit mirrored tower located directly on the beach in Myrtle Beach. Amenities include balconies, fully equipped kitchens, whirlpool baths and other amenities, including an indoor and two outdoor swimming pools, a hot tub, and two saunas. SeaGlass Tower is located near the Pavilion Amusement Park, Broadway at the Beach ^SM , Myrtle Beach Convention Center, and the Myrtle Beach International Airport.

Shore Crest Vacation Villas — North Myrtle Beach, South Carolina. Shore Crest Vacation Villas, consisting of two multi-storied towers and 240 units, is located on the beach in the Windy Hill section of North Myrtle Beach, a mile from the famous Barefoot Landing, featuring its restaurants, theaters, shops and outlet stores.

Tennessee

MountainLoft — Gatlinburg, Tennessee. MountainLoft is located near the Great Smoky Mountains National Park and is minutes from the family attractions of Pigeon Forge, Tennessee. Units are located in individual chalets or mid-rise villa buildings. Each unit is fully furnished with a whirlpool bath and private balconies and certain units include gas fireplaces. When fully developed, we anticipate that this resort will include 414 units.

Laurel Crest — Pigeon Forge, Tennessee. Laurel Crest is located in proximity to the Great Smoky Mountains National Park and the Dollywood theme park. In addition, visitors to Pigeon Forge can enjoy over 200 factory outlet stores and music shows featuring renowned country music stars as well as partake in a variety of outdoor activities, such as horseback riding, trout fishing, boating, golfing and white water rafting. When fully developed, we anticipate that this resort will include 202 units.

Virginia

Shenandoah Crossing — Gordonsville, Virginia. Shenandoah Crossing, which currently includes 262 units, features an 18-hole golf course (which is owned and operated by an unaffiliated third party), indoor and outdoor swimming pools, tennis courts, horseback riding trails and a lake for fishing and boating.

Bluegreen Wilderness Traveler at Shenandoah — Gordonsville, Virginia . This property is located adjacent to our existing resort, Shenandoah Crossing. When completed, Wilderness Traveler at Shenandoah will provide Bluegreen Vacation Club members with a high quality vacation experience in the “great outdoors”. Accommodations will consist of cabins, luxury campsites for recreational vehicles and fully furnished, climate-controlled platform tents, as well as outdoor-themed amenities and programs. When fully developed, we anticipate that this resort will include 206 units.

Wisconsin

Christmas Mountain Village — Wisconsin Dells, Wisconsin. Christmas Mountain Village, offers a 27-hole golf course and seven ski trails served by two chair lifts. Other on-site amenities include horseback riding, tennis courts, a five-acre lake with paddleboats and rowboats and four outdoor swimming pools. This resort attracts customers primarily from the

greater Chicago area and other locations within an eight to ten hour drive of Wisconsin Dells. When fully developed, we anticipate that this resort will include 439 units.

Bluegreen Odyssey Dells – Wisconsin Dells, Wisconsin . This seven acre resort is located adjacent to the 156 acre Mt. Olympus Resort Water and Theme Park (formerly known as Treasure Island Water and Theme Park Resort). When fully developed, we anticipate that this resort will include 100 units.

Aruba

La Cabana Beach & Racquet Club— Oranjestad, Aruba. La Cabana Beach & Racquet Club is a 449-suite oceanfront resort that offers one-, two- and three-bedroom suites, garden suites and penthouse accommodations. On-site amenities include racquetball, squash, two pools and private beach cabanas, none of which are owned or managed by us.

The following table describes the relative size, stage of development and amount of remaining inventory at each of our core resorts. Although all inventory is sold as VOIs, we disclose the size and inventory information in terms of number of vacation homes for ease of comparability between our resorts and those of other companies in the industry. “Vacation homes” are individual lodging units (e.g., condominium-style apartments, town homes, cabins, luxury campsites, etc.).


Resort	Daytona SeaBreeze		The Hammocks at Marathon		The Fountains		Orlando’s Sunshine Resort		Casa Del Mar Beach Resort

Location	Daytona Beach Shores, FL		Marathon, FL		Orlando, FL		Orlando, FL		Ormond Beach, FL

Year acquired (1)	2005		2003		2003		1997		2003
Number of vacation homes completed	80		58		475		90		43
Number of vacation homes under construction	—		—		104		—		—
Number of future vacation homes (2)	—		—		175		—		—
Total current and future vacation homes	80		58		754		90		43
Percentage of total current and future vacation homes sold (3)	78	%	88	%	49	%	89	%	88	%
Estimated remaining life-of-project sales (in millions) (4)	$ 9.8		$ 9.9		$ 323.7		$ 8.1		$ 3.1


Resort	Grande Villas at World Golf Village		Solara Surfside Resort		Mountain Run at Boyne		The Falls Village		Bluegreen Wilderness Club at Big Cedar

Location	St. Augustine, FL		Surfside, FL		Boyne Falls, MI		Branson, MO		Ridgedale, MO

Year acquired (1)	2003		2001		2002		1997		2000
Number of vacation homes completed	152		58		104		164		324
Number of vacation homes under construction	—		—		—		—		—
Number of future vacation homes (2)	—		—		—		76		—
Total current and future vacation homes	152		58		104		240		324
Percentage of total current and future vacation homes sold(3)	87	%	76	%	73	%	49	%	83	%
Estimated remaining life-of-project sales (in millions) (4)	$ 17.2		$ 7.2		$ 15.2		$ 90.8		$ 27.0


Resort	The Suites at Hershey		The Lodge Alley Inn		Carolina Grande		Harbour Lights		Sea Glass Tower

Location	Hershey, PA		Charleston, SC		Myrtle Beach, SC		Myrtle Beach, SC		Myrtle Beach, SC

Year acquired (1)	2004		1998		2005		1997		2005
Number of vacation homes completed	79		90		118		240		144
Number of vacation homes under construction	—		—		—		—		—
Number of future vacation homes (2)	—		—		—		104		—
Total current and future vacation homes	79		90		118		344		144
Percentage of total current and future vacation homes sold(3)	82	%	96	%	91	%	66	%	86	%
Estimated remaining life-of-project sales (in millions) (4)	$ 11.4		$ 2.7		$ 8.2		$ 90.8		$ 11.3


Resort	Shore Crest Vacation Villas		MountainLoft		Laurel Crest		Shenandoah Crossing		Bluegreen Wilderness Traveler at Shenandoah

Location	North Myrtle Beach, SC		Gatlinburg, TN		Pigeon Forge, TN		Gordonsville, VA		Gordonsville, VA

Year acquired (1)	1996		1994		1995		1997		2007
Number of vacation homes completed	240		284		152		262		36
Number of vacation homes under construction	—		—		—		—		170
Number of future vacation homes (2)	—		130		50		—		—
Total current and future vacation homes	240		414		202		262		206
Percentage of total current and future vacation homes sold(3)	93	%	62	%	65	%	98	%	1	%
Estimated remaining life-of-project sales (in millions) (4)	$ 11.5		$ 198.0		$ 65.0		$ 2.9		$ 154.2


Resort	Christmas Mountain Village		Bluegreen Odyssey Dells		La Cabana Beach and Racquet Club

Location	Wisconsin Dells, WI		Wisconsin Dells, WI		Oranjestad, Aruba

Year acquired (1)	1997		2006		1997
Number of vacation homes completed	309		24		449
Number of vacation homes under construction	—		—		—
Number of future vacation homes (2)	130		76		—
Total current and future vacation homes	439		100		449
Percentage of total current and future vacation homes sold (3)	68	%	0	%	94	%
Estimated remaining life-of-project sales (in millions) (4)	$ 175.9		$ 109.1		$ 17.9


	(1)	Year that we first acquired the land to develop the resort or the year we first acquired existing VOIs at the resort, as applicable.

	(2)	Number of vacation homes that can be developed at the resort in the future. We cannot provide any assurance that we will have the resources, or will decide to commence or complete the development of any of future vacation homes or that the resulting VOIs will be sold at favorable prices.

	(3)	This is the portion of each resort that has been sold as of December 31, 2007, including sales made by prior owners of the resorts, if applicable. The unsold portion includes vacation homes that are either completed, under construction or subject to future development and may include VOIs that were sold and then reacquired through equity trade, receivable default or otherwise.

	(4)	Estimated remaining life-of-project sales as of December 31, 2007, including both built and un-built units. This table excludes VOI inventory that we own at several non-owned resorts (“Miscellaneous Inventory”). The aggregate estimated remaining life-of-project sales for our Miscellaneous Inventory as of December 31, 2007 was $107.3 million or less than 4% of Bluegreen Resorts’ estimated remaining life-of-project sales. This table also excludes the estimated life-of-project sales at the 2006 and 2007 resort acquisitions under development at December 31, 2007, as discussed below. There is no assurance that we will realize the estimated remaining life-of-project sales.

The table excludes acquisitions of property for future vacation ownership resorts made during 2006 & 2007 including properties in Las Vegas, Nevada; Williamsburg, Virginia; and Ridgedale, Missouri (the “Future Resorts”). Occupancy is expected following the completion of construction and development activities at each of these resorts. The aggregate estimated life-of-project sales for our Future Resorts as of December 31, 2007 is as follows:


Future Resort Location	Las Vegas, NV	Williamsburg, VA	Ridgedale, MO

Year acquired	2006	2006	2007
Total future vacation homes	240	355	189
Estimated life-of-project sales (in millions)	$ 460.0	$ 465.0	$ 340.0

Each of our resorts maintain property and casualty insurance coverage. In addition, we, or general contractors hired by us, typically purchase performance bonds if required by the local jurisdictions in which we develop our resorts. There is no assurance that insurance or performance bonds will remain available on attractive terms, at acceptable prices, or at all.

Bluegreen Communities

Described below are the communities with the most significant estimated remaining life-of-project sales marketed by Bluegreen Communities as of December 31, 2007.

North Carolina

Chapel Ridge— Chatham County, North Carolina. In July 2004, we acquired approximately 800 acres of land centrally located between Chapel Hill/Durham, Cary/Apex, Sanford/Siler City and the Triad areas in Chatham County, North Carolina for $5.5 million. Amenities at this golf community includes an 18-hole Fred Couples Signature Golf Course, a clubhouse and conservation areas. The golf course and clubhouse will be owned by us and operated on a daily-fee basis. General improvements to the homesites at Chapel Ridge being performed by us include in most cases, water, sewer, electric, telephone and cable television utilities as well as selective homesite clearing. We began selling homesites at Chapel Ridge in July 2004. During 2006, we acquired 242 acres of land as an addition to Chapel Ridge for $7.4 million. Sales at this addition began in March 2007.

Texas

Mystic Shores— Canyon Lake, Texas. We acquired 6,966 acres located 25 miles north of San Antonio, Texas in October 1999 for $14.9 million. On May 5, 2000, we purchased an additional 435 acres for $2.7 million. The community is expected to include approximately 2,400 homesites, ranging in size from one to 20 acres. Mystic Shores is situated on Canyon Lake and is in close proximity to the Guadeloupe River, which is well known for fishing, rafting and water sports. The property also features a swimming pool, bathhouse, open-air pavilion and picnic area. General improvements on homesites at Mystic Shores performed by us included, in most cases, water and selective homesite clearing, while some sections of the community also include electric and telephone utilities. We began selling homesites at Mystic Shores in March 2000.

Lake Ridge at Joe Pool Lake— Cedar Hill, Texas. In April 1994, we acquired 1,400 acres located approximately 19 miles outside of Dallas, Texas and 30 miles outside of Fort Worth, Texas, for $6.1 million. In fiscal 2000, we acquired an additional 1,766 acres for $14.9 million. The property is located at Joe Pool Lake and is atop the highest elevation within 100 miles. The lake, which is a public recreation area, has in excess of 7,500 acres of water for boating, fishing, windsurfing and other water activities. Adjacent amenities, also not owned by us, include a 154-acre park with baseball, football and soccer fields, camping areas and an 18-hole golf course. The existing acreage is expected to yield approximately 2,530 homesites, with most homesites ranging in size from 1/4 to five acres. General improvements on the homesites at Lake Ridge performed by us include, in most cases, water, sewer, electric, telephone and cable television utilities as well as selective homesite clearing. We began selling homesites at Lake Ridge at Joe Pool Lake in April 1994.

King Oaks— College Station, Texas. In September 2006, we acquired a 953-acre parcel in College Station, Texas, located northwest of Houston for $3.1 million. The property is expected to be developed into a community with 432 homesites. General improvements on the homesites at King Oaks being performed by us include, in most cases, water and sewer, utilities and selective homesite clearing. We began selling homesites at King Oaks in November 2006.

The Bridges at Preston Crossings— Grayson County, Texas. In March 2006, we acquired 1,580-acres for a planned golf community in Grayson County, Texas, located just outside of Dallas, for $26.1 million. Amenities at this golf community are expected to include an 18-hole Fred Couples Signature Golf Course, a clubhouse and conservation areas. The golf course and clubhouse will be owned by us and operated on a daily-fee basis. General improvements being made by us, in most cases, include water, sewer, electric, telephone and cable television utilities as well as selective homesite clearing. We began selling homesites at The Bridges at Preston Crossings in September 2006.

Saddle Creek Forest— Magnolia, Texas . In January 2005, we acquired approximately 1,053 acres of land located near Houston, Texas in Montgomery County for $2.7 million. Saddle Creek Forest features 464 heavily wooded, private lake and creekside homesites, ranging in size from one to five acres. General improvements on the homesites at Saddle Creek Forest being performed by us include, in most cases, water and sewer utilities and selective homesite clearing. We began sales of homesites at Saddle Creek Forest in August 2005. We also acquired 130 acres in April 2006 for $700,000 for a new section of Saddle Creek Forest.

Havenwood at Hunter’s Crossing— New Braunfels, Texas . In July 2005, we acquired approximately 1,263 acres of land in Comal County, Texas with convenient access to Austin and San Antonio, Texas for $7.5 million. This gated community offers premium hilltop homesites on one to three acres of land. Havenwood at Hunter’s Crossing features dense oaks and stunning views of the surrounding Hill Country. General improvements on the homesites at Havenwood

at Hunter’s Crossing being made by us include, in most cases, water, sewer, electric, telephone and cable television utilities as well as selective homesite clearing. We began sales of homesites at Havenwood at Hunter’s Crossing in January 2006.

Vintage Oaks at the Vineyard— New Braunfels, Texas. In April 2006, we acquired a 3,300-acre parcel in New Braunfels, Texas, which is located just outside San Antonio, for $27.3 million. Amenities at this community are expected to include walking trails, a large pool complex and a park. General improvements on the homesites at Vintage Oaks being performed by us include, in most cases, water and sewer utilities and selective homesite clearing. We began selling homesites at Vintage Oaks in October 2006.

SugarTree on the Brazos— Parker County, Texas . In November 2004, we acquired approximately 429 acres of land located near Fort Worth, Texas in Parker County, Texas for $4.3 million. This gated community is surrounded by a championship golf course (separately owned and operated) and is nestled along the shores of the Brazos River. Amenities at this community includes a swimming center and clubhouse. General improvements on the homesites at SugarTree on the Brazos being performed by us include, in most cases, water and sewer utilities and selective homesite clearing. We began sales of homesites at this community in March 2005.

Georgia

Sanctuary Cove at St. Andrew’s Sound— Waverly, Georgia . In November 2003, we acquired 564 acres of land near St. Simons Island in Brunswick County, Georgia for $11.3 million. Amenities at this golf community include an 18-hole Fred Couples Signature Golf Course designed by Love Golf Design, a clubhouse and swimming and tennis facilities. The golf course and clubhouse is owned by us and operated on a daily-fee basis. Sanctuary Cove adjoins approximately 1,000 acres of preserved saltwater marshes and coastal wetlands. General improvements relative to the homesites at Sanctuary Cove being made by us, in most cases, included, water, sewer, electric, telephone and cable television utilities as well as selective homesite clearing. We began selling homesites at Sanctuary Cove in December 2003. In February 2007, we acquired an additional 381 acres of land for $18.0 million to be sold as The Estates, an expansion of Sanctuary Cove.

The following table provides additional information about significant Bluegreen Communities projects described above:


Community	Chapel Ridge		Mystic Shores		Lake Ridge at Joe Pool Lake		King Oaks

Location	Chatham County, NC		Canyon Lake, TX		Cedar Hill, TX		College Station, TX

Year acquired (1)	2004		1999		1994		2006
Total acreage	1,040		7,401		3,166		953
Number of homesites anticipated (2)	849		2,327		2,325		442
Percentage of anticipated homesites sold (3)	76	%	98	%	89	%	23	%
Estimated remaining life-of-project sales (in millions) (4)	$ 19.7		$ 7.1		$ 37.8		$ 23.5
Remaining inventory, at cost (in millions) (5)	$ 11.5		$ 0.3		$ 17.5		$ 5.5


Community	The Bridges at Preston Crossings		Saddle Creek Forest		Havenwood at Hunter’s Crossing		Vintage Oaks at the Vineyard

Location	Grayson County, TX		Magnolia, TX		New Braunfels, TX		New Braunfels, TX

Year acquired (1)	2006		2005		2005		2006
Total acreage	1,580		1,053		1,263		3,300
Number of homesites anticipated (2)	2,096		486		679		2,065
Percentage of anticipated homesites sold (3)	5	%	92	%	68	%	15	%
Estimated remaining life-of-project sales (in millions) (4)	$ 159.8		$ 5.5		$ 17.6		$ 131.1
Remaining inventory, at cost (in millions) (5)	$ 36.1		$ 4.0		$ 5.6		$ 26.3


Community	SugarTree on the Brazos		Sanctuary Cove at St. Andrews Sound

Location	Parker County, TX		Waverly, GA

Year acquired (1)	2004		2003
Total acreage	429		881
Number of homesites anticipated (2)	346		994
Percentage of anticipated homesites sold (3)	53	%	71	%
Estimated remaining life-of-project sales (in millions) (4)	$ 10.0		$ 65.3
Remaining inventory, at cost (in millions) (5)	$ 5.7		$ 21.1


	(1)	Year that we first acquired the land to commence development of each community. Certain communities were acquired in phases.

	(2)	Number of homesites anticipated within each community. We cannot provide any assurance that we will have the resources, or will decide, to develop such homesites at each community, that required platting and other approvals will be obtained to develop such homesites or that such homesites will be sold at favorable prices.

	(3)	This is the percentage of anticipated homesites sold through December 31, 2007.

	(4)	Estimated remaining life-of-project sales as of December 31, 2007. This table excludes additional projects currently being marketed by Bluegreen Communities with an aggregate estimated remaining life-of-project sales as of December 31, 2007 of $13.4 million, or approximately 3% of Bluegreen Communities total estimated remaining life-of-project sales. There is no assurance that we will realize the estimated remaining life-of-project sales.

	(5)	Reflects current carrying value at historical cost, but excludes future development expenditures expected to be necessary to complete the communities. See also “Commitments”. This table excludes additional projects currently being marketed by Bluegreen Communities with an aggregate current carrying value at historical cost of $3.8 million.

While there may be limits on the amount of insurance available and some policies have significant deductibles, we believe that each of our Bluegreen Communities properties is adequately covered by builder’s risk insurance during the construction period or property and casualty insurance for our owned golf amenities and homesites that are held in our inventory prior to sale to consumers. Once a homesite is sold, the consumer assumes the risk of loss on such homesite. In addition, the applicable property owners’ association bears the risk of loss on any common amenities at each project and carries its own insurance on such property.

We also purchase performance bonds in connection with the development of most of our communities, in order to provide assurance to homesite buyers that construction of the community will be completed. We believe that our ability to obtain such performance bonds assists us in our pre-construction sales efforts.

Acquisition of Bluegreen Resorts and Bluegreen Communities Inventory

Bluegreen Resorts

We intend to continue to pursue growth by expanding or supplementing our existing resorts operations through acquisitions in destinations that we believe will complement such operations. We may consider acquiring additional VOI inventory, operating companies, management contracts, VOI mortgage portfolios and properties or other vacation ownership-related assets that may be integrated into our operations.

We obtain information with respect to resort acquisition opportunities through interaction by our management team with resort operators, lodging companies and financial institutions with which we have established business relationships. We evaluate the following factors, among others, to determine the viability of a potential new vacation ownership resort:


	•	attractiveness of the market as a source of incremental sales;

	•	anticipated supply/demand ratio for VOIs in the relevant market;

	•	the market’s potential growth as a vacation destination;

	•	competitive accommodation alternatives in the market;

	•	the uniqueness of location and demand for the location by existing Bluegreen Vacation Club members;

	•	barriers to entry that would limit competition;

	•	acceptable profit margin and cash flow based upon anticipated retail value; and,

	•	best interests of Bluegreen Vacation Club members taken as a whole with respect to opportunities to use and occupy club accommodation.

Bluegreen Communities

Bluegreen Communities seeks to acquire property that is located near a major population center but outside the perimeter of intense subdivision development or in popular retirement areas; is suitable for subdivision; has attractive topographical features; for certain projects, could accommodate a golf course and related amenities; and, produce an acceptable profit margin and cash flow to us based upon anticipated retail value. Communities are generally subdivided for sale into homesites typically ranging in size from 1/4 acre to five acres.

In connection with our review of potential Bluegreen Communities inventory, we consider economic conditions in the area in which the parcel is located, environmental sensitivity, availability of financing, whether the property is consistent with our general policies and the anticipated ability of that property to produce acceptable profit margins and cash flow. As part of our long-term strategy for Bluegreen Communities, we have focused on fewer, more capital-intensive communities, in markets we know well. We intend to continue to focus Bluegreen Communities on those regions where we believe the market for our products is strongest, and to replenish our residential land inventory in such regions as existing projects are sold out.

Bluegreen Communities has established contacts with numerous land owners and real estate brokers in many of our market areas, and because of such contacts and our long history of acquiring properties, we believe that we are generally in a favorable position to learn of available properties, sometimes before the availability of such properties is publicly known. We also have an acquisition research department which systematically searches and sources properties in targeted and future markets.

Prior to acquiring property in new areas, we will generally conduct test marketing for a prospective community to determine whether sufficient customer demand exists for the community.

By requiring that regulatory approvals be obtained prior to closing and by limiting the amount of the down payment upon signing a purchase agreement, we are typically able to place a number of properties under contract without expending significant amounts of cash. This strategy helps Bluegreen Communities to reduce:


	•	the time during which it actually owns specific communities between initial acquisition and the ultimate sale;

	•	the market risk associated with holding such communities; and

	•	the risk of acquiring properties that may not be suitable for sale.

Marketing and Sale of Inventory

Bluegreen Resorts

Bluegreen Resorts uses a variety of methods to attract prospective purchasers of VOIs, including selling discount mini-vacations either face-to-face with consumers we meet in connection with various marketing alliances or through telemarketing methods (see further discussion of our marketing alliances below), placing marketing kiosks in retail locations and acquiring the right to market to prospective purchasers from third-party vendors. In addition to attracting new customers, we seek additional sales to existing VOI owners (“Upgrades”), and referrals of prospective purchasers from existing VOI owners and others. Upgrades involve relatively less marketing expense and typically result in relatively higher operating margins than sales through other marketing channels. Bluegreen Resorts sometimes provides hotel accommodations or accommodations in one of our resorts to prospective purchasers at reduced rates in exchange for their touring one of our resorts. To support our marketing and sales efforts, we have developed and work to continue to enhance our customer relationship management methods, techniques and computer software tools to track our VOI marketing and sales programs. We believe that as Bluegreen Resorts’ operations grow, this database will become an increasingly significant asset, positioning us to focus our marketing and sales efforts to take advantage of, among other things, less costly marketing and referral opportunities.

In recent years, we have focused on increasing Bluegreen Resorts’ use of “permission” marketing and branding programs. “Permission” marketing methods involve obtaining the prospective purchasers’ permission, directly or indirectly, to contact them in the future regarding an offer to purchase a product or service. Branding involves forming alliances with third-party entities that possess what we believe to be a nationally or regionally known brand name, a good reputation and a customer base with similar demographic characteristics to our target market.

On June 16, 2000, one of our wholly-owned subsidiaries entered into an agreement with Big Cedar, LLC (“Big Cedar”), an affiliate of Bass Pro, Inc. (“Bass Pro”), to form the Joint Venture, a vacation ownership development, marketing and sales limited liability company. Our subsidiary owns 51% of the Joint Venture and Big Cedar owns 49%. Pursuant to the terms of the original agreement, the Joint Venture has been developing, marketing and selling VOIs at The Bluegreen Wilderness Club at Big Cedar, a 324-unit, wilderness-themed resort adjacent to the Big Cedar Lodge, a luxury hotel resort owned by Big Cedar, on the shores of Table Rock Lake in Ridgedale, Missouri. In December 2007, the agreement was amended to include the development, marketing, and selling of timeshare interests in additional property purchased by the Joint Venture in September 2007. Pursuant to the amended agreement, the Joint Venture will pay Big Cedar a fee upon the sales of newly developed timeshare interests for promotional, marketing, and advertising services.

On June 16, 2000, we entered into an exclusive, 10-year marketing agreement with Bass Pro, a privately-held retailer of fishing, marine, hunting, camping and sports gear. Pursuant to the agreement, we have the right to market our VOIs at each of Bass Pro’s national retail locations (As of December 31, 2007, we had a presence in 45 of Bass Pro’s stores), in Bass Pro’s catalogs and on its web site. We also are provided access to Bass Pro’s customer lists. In exchange for these services, we compensate Bass Pro based on the overall success of their marketing activities through one of the Bass Pro marketing channels described above. The amount of compensation is dependent on the level of additional marketing efforts required by us to convert the prospect into a sale and a defined time frame for such marketing efforts. No separate compensation is paid by Bluegreen to Bass Pro on sales made by the Joint Venture. In 2005, 2006, and 2007, we recognized marketing compensation expense to Bass Pro of approximately $5.2 million, $6.4 million, and $6.6 million, respectively. In December 2007, the marketing agreement was amended to extend through December 31, 2014 and also requires us to make a non-interest bearing annual prepayment to Bass Pro on or before January 1 each year, which operates as an advance payment for anticipated commissions to be earned in the upcoming year. The annual prepayment will be equal to 100% of the estimated amount of commissions anticipated to be generated during the upcoming year, as determined by the Company and Bass Pro, not to exceed $5,000,000. No additional commissions will be paid to Bass Pro during any year, until the annual prepayment for that year has been fully earned.

In 2006 we entered into an agreement with Six Flags, Inc., the world’s largest recreational theme park company. This agreement allows us to conduct sponsorship and promotional marketing programs in 13 Six Flags parks through 2011. Additionally in 2006 we entered into an agreement with Cedar Fair Entertainment (successor to Paramount Parks) to conduct sponsorship and promotional marketing programs in 3 Cedar Fair parks through 2010.

Our VOI resorts are staffed with sales representatives, sales managers and an on-site manager who oversees the day-to-day operations, all of whom are our employees. We sponsor ongoing training for our personnel. During the year ended December 31, 2007, total selling and marketing expense for Bluegreen Resorts was $260.9 million, or 58% of the division’s $453.5 million of sales.

It is our policy to require our sales staff to provide each VOI customer with a written disclosure statement regarding the VOI to be sold prior to the time the customer signs a purchase agreement. The purpose of this disclosure statement is to explain relevant information regarding VOI ownership at the resort and memberships in Bluegreen Vacation Club and, pursuant to our policies, the statement must be signed by every purchaser. After deciding to purchase a VOI, a purchaser enters into a purchase agreement and is required to pay us a deposit of at least 10% of the purchase price (see Note 1 and Note 2 of the Notes to Consolidated Financial Statements for a discussion of the impact of SFAS No. 152 on the calculations of the amount of the down payment for purposes of generally accepted accounting principles). Purchasers are entitled to cancel purchase agreements within required legal rescission periods after execution in accordance with statutory requirements. Substantially all VOI purchasers visit one of our resorts or one of our off-site sales offices prior to or at the time of purchasing.

In addition to sales offices located at our resorts, we also operate seven off-site sales offices serving the Atlanta, Georgia; Chicago, Illinois; Indianapolis, Indiana; Detroit, Michigan; Minneapolis, Minnesota; Dallas, Texas; and Las Vegas, Nevada markets, as well as a sales office at a resort under development located in Williamsburg, Virginia. Our off-site sales offices market and sell VOIs in the Bluegreen Vacation Club, and allow us to bring our products to markets with favorable demographics and low competition for prospective buyers. We continue to evaluate our ongoing utilization of off-site sales operations and may elect to open new locations or close existing locations in the future.

Bluegreen Communities

In general, as soon as practicable after agreeing to acquire a property and during the time period that improvements are being completed, we establish selling prices for the individual homesites. In pricing the homesites, we attempt to take into account such matters as regional economic conditions, quality as a building site, scenic views, road frontage, golf course views (if applicable) and natural features such as lakes, mountains, streams, ponds and wooded areas. We also consider recent sales of comparable parcels in the area. Once selling prices are established and registration requirements fulfilled, we commence our marketing efforts.

Bluegreen Communities utilizes a variety of marketing mediums, and those most widely used include internet advertising, consumer and broker outreach programs, billboards and print media. In addition, we use our customer relationship management system, which we believe enables us to identify prospects that are most likely to be interested in a particular community. Bluegreen Communities also conducts direct mail campaigns to market communities through the use of brochures describing available homesites, as well as television, billboard, Internet and radio advertising. A sales representative, who is knowledgeable about the community, answers inquiries generated by our marketing efforts, discusses the community with the prospective purchaser, attempts to ascertain the purchaser’s needs and arranges an appointment for the purchaser to visit the community. Substantially all prospective purchasers inspect a property before purchasing.

The success of our marketing efforts depends heavily on the knowledge and experience of our sales personnel. We generally require that all sales representatives walk the community and become knowledgeable about each homesite and applicable zoning, subdivision and building code requirements prior to initiating the marketing effort for a community. Continuous training programs are conducted, including training with regional office sales managers, weekly sales meetings and frequent site visits by our executive officers. We believe we enhance our sales and marketing organization through our Bluegreen Institute, a mandatory training program that is designed to instill our marketing and customer service philosophy in our employees. Additionally, the sales staff is evaluated against performance standards established by our executive officers. Substantially all of a sales representatives’ compensation is commission-based.

Our sales staff is required by law to provide each prospective homesite purchaser with a written disclosure statement regarding the property to be sold prior to the time such purchaser signs a purchase agreement. This information statement, which is either in the form of a U.S. Department of Housing and Urban Development (“HUD”) lot information statement (“Property Report”), where required, or a “Vital Information Statement” that we generate, states relevant information with respect to, and risks associated with, the property, a receipt for which must be signed by each purchaser.

After deciding to purchase a homesite, a purchaser enters into a purchase agreement and is required to pay us a deposit of at least 10% of the purchase price. Purchasers are entitled to cancel purchase agreements within specified legal rescission periods after execution in accordance with statutory requirements. The closing of a homesite sale usually occurs two to eight weeks after payment of the deposit. Upon closing of a homesite sale, we typically deliver a warranty deed. Title insurance is available at the purchaser’s expense.

Customer Financing

General

Sales of VOIs accounted for 78% of our consolidated sales, and approximately 95% of our VOI customers utilized our financing during the year ended December 31, 2007. For the past several years, the percentage of Bluegreen Communities customers who utilized our financing has been less than 1% of all homesite purchasers due to, among other things, a historic willingness on the part of banks to extend direct homesite financing to purchasers. Should bank financing of homesite purchases become less available to our consumers, we anticipate that we may need to provide financing to a greater percentage of Bluegreen Communities’ customers in order to consummate sales. If this were to become the case, it would have an adverse effect on our operations and cash flows.

We offer financing to our VOI customers of up to 90% of the purchase price of our VOIs. The typical financing extended by us on a VOI during the year ended December 31, 2007, provided for a term of 10 years and a fixed interest rate. In connection with our VOI sales within the Bluegreen Vacation Club, we deliver the deed on behalf of the purchasers to the trustee of the vacation club and secure repayment of the purchaser’s obligation by obtaining a mortgage on the purchaser’s real estate-based VOI.

See “Industry Overview – The Consumer” more information about the demographic profile of our typical customer.

Based on a review conducted in January 2008, the range of Fair Isaac Corporation (“FICO®”) scores of our entire portfolio of originated and serviced VOI receivables for the consumers with FICO® scores as of that date was as follows:


FICO® Score	Percentage of originated and serviced VOI receivables


Below 620	30.8%
Between 620 and 700	32.2%
Above 700	37.0%

The weighted-average interest rate on our owned notes receivable by division was as follows:


	As of December 31,

Division	2006	2007

Bluegreen Resorts	14.3%	13.9%
Bluegreen Communities	11.9%	12.1%
Consolidated	14.2%	13.8%

See “Sale of Receivables/Pledging of Receivables,” below, for information regarding our receivable financing activities.

Loan Underwriting

Bluegreen Resorts

Our VOI financing is not subject to any significant loan underwriting criteria and no FICO® score is obtained prior to extending the credit, a characteristic typically shared with subprime loans. Currently, customer financing on sales of VOIs typically requires the following: (1) receipt of a minimum down payment of 10% of the purchase price; (2) a note and mortgage (or deed of trust); and, (3) other closing documents between the purchaser and ourselves. We encourage purchasers to make higher down payments in return for a lower interest rate. In addition, purchasers who do not elect to participate in our pre-authorized checking payment plan are charged interest at a rate which is 1% greater than the otherwise prevailing rate, where allowed by applicable laws and regulations. As of December 31, 2007, approximately 83% of our VOI notes receivable serviced were on our pre-authorized payment plan.

Bluegreen Communities

At Bluegreen Communities, we have established loan underwriting criteria and procedures designed to reduce credit losses. The loan underwriting process undertaken by our credit department may include reviewing the applicant’s credit history and credit score, verifying employment and income as well as calculating certain debt-to-income ratios. The primary focus of our underwriting review is to determine the applicant’s ability to repay the loan in accordance with our terms.

Collection Policies

Bluegreen Resorts

Financed sales of VOIs sold through the Bluegreen Vacation Club are effected using a note and mortgage arrangement. Collection efforts in substantially all cases and delinquency information concerning Bluegreen Resorts’ notes receivables are managed at our corporate headquarters. A staff of experienced collectors, assisted by a mortgage collection computer system, handles servicing of the division’s receivables. Our collectors are incentivized through a performance-based compensation program. We generally make collection efforts to customers by mail and by telephone. In addition to telephone contact generally commencing at 16 days past due, a 30-day collection letter is sent to U.S. residents advising the customer that if the loan is not brought current, the delinquency will be reported to the credit reporting agencies. At 60 days delinquent, we send a lockout letter, return receipt requested, to the customer advising that they cannot make any future reservations for lodging at a resort. If the delinquency continues, at 90 days past due, we stop the accrual of, and reverse previously accrued, but unpaid, interest on the note receivable and mail a “Notice of Intent to Cancel Membership”, return receipt requested, which informs the customer that unless the delinquency is cured within 30 days, we will terminate the customer’s VOI ownership. At this point, the account may be reviewed by the collection manager to determine if, in certain limited circumstances, additional correspondence should

be sent offering repayment options. If the customer fails to respond to the correspondence within the given timeframe, the loan will be defaulted and the customer’s VOI terminated. At approximately 120 days delinquent, we send a final “Termination Letter”, return receipt requested. Thereafter we seek to resell the VOI to a new purchaser. Historically, we have typically not sought to collect a deficiency on defaulted promissory notes.

Bluegreen Communities

Collection efforts and delinquency information concerning Bluegreen Communities’ notes receivable are managed at our corporate headquarters. A staff of experienced collectors handles servicing of the division’s receivables. We generally make collection efforts by mail and telephone. Collection efforts generally begin when an account is 16 days past due, at which time we contact the customer by telephone and attempt to determine the reason for the delinquency and bring the account current. The determination of how to handle a delinquent loan is based upon many factors, including the customer’s payment history and the reason for the current inability to make timely payments. If the customer does not abide by an agreed-upon collection agreement, or if no agreement is reached, collection efforts continue until the account is either brought current or legal action is commenced. If not accelerated sooner, we typically declare the loan in default when the loan becomes 60 days delinquent. When the loan is 90 days past due, we stop the accrual of, and reverse previously accrued but unpaid, interest (unless the loan is deemed to be an in-substance foreclosure loan, in which case all accrued interest is reversed since our means of recovery is determined through the resale of the underlying collateral and not through collection on the note) and the collection manager determines any further action required to be taken, which may include obtaining a deed in lieu of foreclosure or initiating a foreclosure.

Loan Loss Reserves

The allowance for loan losses as a percentage of our outstanding notes receivable was approximately 9% and 10% at December 31, 2006 and 2007, respectively. We determine the adequacy of our reserve for loan losses and review it on a regular basis considering, among other factors, historical frequency of default, loss experience, static pool analyses, estimated value of the underlying collateral, current delinquency rates, present and expected economic conditions, as well as other factors. Effective January 1, 2006, we changed our accounting for loan losses on our VOI notes receivable in accordance with SFAS No. 152. Under SFAS No. 152, we estimate uncollectibles based on historical uncollectibles for similar VOI notes receivable and no longer consider the value of the underlying collateral. During the years ended December 31, 2005, 2006, and 2007, the average annual default rates and delinquency rates on Bluegreen Resorts’ and Bluegreen Communities’ receivables owned or serviced by us were as follows:


Average Annual Default Rates	Year Ended December 31,


Division	2005	2006	2007

Bluegreen Resorts	8.5%	7.5%	7.4%
Bluegreen Communities	2.9% ⁽¹⁾	3.6%	4.6%


Delinquency Rates	As of December 31,


Division	2005	2006	2007

Bluegreen Resorts	5.9%	4.0%	4.5%
Bluegreen Communities	12.0%	7.8%	13.2%


	(1)	Excludes December 2005 default of a $1.3 million note receivable not made in the ordinary course of business.

Substantially all defaulted vacation ownership notes receivable result in the holder of the note receivable acquiring the related VOI that secured the note receivable. In cases where Bluegreen has retained ownership of the vacation ownership note receivable, the VOI is reacquired and resold in the normal course of business. We may, but are not obligated to, remarket the defaulted VOI on behalf of the note holder in exchange for a remarketing fee designed to approximate our sales and marketing costs.

Sales of Receivables/Pledging of Receivables

During the years ended December 31, 2005, 2006, and 2007, all of our notes receivable sold and the majority of our notes receivable pledged consisted of notes receivable generated by Bluegreen Resorts.

Since 1986, we have sold or pledged a significant amount of our receivables, generally retaining the right and obligation to service such receivables. In the case of Bluegreen Communities’ receivables pledged to a financial institution, we generally must maintain a debt-to-eligible collateral rate (based on the outstanding principal balance of the pledged

loans) of 90%. We are obligated to pledge additional eligible receivables or make additional principal payments in order to maintain this collateralization rate.

Since fiscal 1999, we have maintained various vacation ownership receivables purchase facilities with financial institutions. Our ability to sell and/or borrow against our notes receivable from VOI buyers is a critical factor in our continued liquidity. The vacation ownership business involves making sales of a vacation product pursuant to which a financed buyer is only required to pay a minimum of 10% of the purchase price up front, yet selling, marketing and administrative expenses are primarily cash expenses, which, in our case for the year ended December 31, 2007, approximated 64% of sales. Accordingly, having facilities for the sale and hypothecation of these vacation ownership receivables is a critical factor to our meeting our short- and long-term cash needs.

The vacation ownership receivables purchase facilities that we have historically maintained have typically utilized an owner’s trust structure, pursuant to which we sell receivables to one of our wholly-owned, special purpose finance subsidiaries. These subsidiaries then sell the receivables to an owner’s trust (a qualified special purpose entity) without recourse to us or our subsidiaries, except for breaches of certain representations and warranties at the time of sale. We historically have not entered into any guarantees in connection with our vacation ownership receivables purchase facilities. These facilities usually have detailed requirements with respect to the eligibility of receivables for purchase and fundings under these facilities are typically subject to certain conditions precedent. Under such purchase facilities, a variable purchase price of a portion of the principal balance of the receivables sold, subject to certain terms and conditions, is paid at closing in cash. The balance of the purchase price is deferred until such time as the purchaser of our vacation ownership receivables has received a specified return and all servicing, custodial, agent and similar fees and expenses have been paid and as applicable, a specified overcollateralization ratio is achieved and a cash reserve account is fully funded. We have historically acted as servicer of the vacation ownership receivables we have sold under these purchase facilities for a fee.

Our vacation ownership receivables purchase facilities typically include various conditions to purchase, covenants, trigger events and other provisions customary for these types of transactions.

Although sales of our receivables pursuant to vacation ownership receivables purchase facilities have historically been deemed “true sales” from a legal perspective, the accounting for such transactions could be either as off-balance sheet sales or as on-balance sheet borrowings, depending on the application of the requirements of SFAS No. 140. In our disclosures with respect to each vacation ownership receivables purchase facility, we indicate how these transactions are treated for accounting purposes.

A portion of our revenues historically has been, and is expected to continue to be, comprised of gains on sales of notes receivable. The gains are recorded on our consolidated statement of income and the related retained interests in the notes receivable sold are recorded on our consolidated balance sheet at the time of sale. The amount of gains recognized and the fair value of the retained interests recorded are based in part on management’s best estimates of future prepayment rates, default rates, loss severity rates, discount rates and other considerations in light of then-current conditions. If actual prepayments with respect to loans occur more quickly than we projected at the time such loans were sold, as can occur when interest rates decline, interest income would be less than expected and may cause a decline in the fair value of the retained interests and a charge to operations. If actual defaults or loss severity rates discussed above with respect to loans sold are greater than estimated, charge-offs would exceed previously estimated amounts and the cash flow from the retained interests in notes receivable sold would decrease. Also, to the extent the portfolio of receivables sold fails to satisfy specified performance criteria (as may occur due to, for example, an increase in default rates which we are unable to mitigate through the purchase of certain defaulted loans, or substitution thereof, for new notes receivable) or certain other events occur, the funds received from obligors must be distributed on an accelerated basis to investors. If the accelerated payment formula were to become applicable, the cash flow to us from the retained interests in notes receivable sold would be reduced until the outside investors were paid or the regular payment formula was resumed. In addition, from time to time, we may agree to defer receiving all or a portion of our deferred payment on certain of our retained interests in notes receivable sold to maintain acceptable ratings from third party rating agencies. Also, as market conditions change, the discount rates that we use to value our retained interests in notes receivable sold may change.

During the year ended December 31, 2007, we recognized an other-than-temporary decrease of approximately $2.4 million in the fair market value of our retained interest in VOI notes receivable. The overall decrease in the value of our retained interests in VOI notes receivable in 2007 reflects an increase in the discount rates applied to estimated future cash flows on our retained interests as a result of the overall increase in return required by investors in our securitization transactions due to the deteriorating credit market in the second half of 2007. If the credit market worsens, or if the situations described above in the previous paragraph were to occur, it could cause a decline in the fair value of the retained interests and a charge to earnings. There is no assurance that the carrying value of our retained interests in notes

receivable sold will be fully realized or that future loan sales will be consummated or, if consummated, result in gains. See “VOI Receivables Purchase Facilities – Off Balance Sheet Arrangements,” below.

See “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Vacation Ownership Receivables Purchase Facilities – Off-Balance Sheet Arrangements” for information about our current VOI receivables purchase facilities.

Receivables Servicing

Receivables servicing includes collecting payments from borrowers and remitting such funds to the owners, lenders or investors in such receivables, accounting for principal and interest on such receivables, making advances when required, contacting delinquent borrowers, terminating a membership in our vacation club in the event that defaults are not remedied, and performing other administrative duties. Our obligation to service the receivables and our right to collect fees for a given pool of receivables are set forth in a servicing agreement. We have the obligation and right to service all of the receivables we originate and have retained the obligation and right with respect to the receivables we have sold under any of our vacation ownership receivable purchase facilities to date, although in certain circumstances the purchasers may elect to appoint a new servicer. We typically receive an annual servicing fee of approximately 1.5% to 2.0% of the principal balance of the loans serviced on behalf of others. During the years ended December 31, 2005, 2006, and 2007, we recognized aggregate servicing fee income of $5.0 million, $7.0 million, and $8.7 million, respectively.

Regulation

The vacation ownership and real estate industries are subject to extensive and complex federal, state, and local governmental regulation. We are subject to various federal, state, local and foreign environmental, zoning, consumer protection and other statutes and regulations regarding the acquisition, subdivision, marketing and sale of real estate and VOIs and various aspects of our financing operations. On a federal level, the Federal Trade Commission has taken an active regulatory role through the Federal Trade Commission Act, which prohibits unfair or deceptive acts or unfair competition in interstate commerce. In addition, many states have what are known as “Little FTC Acts” that apply to intrastate activity. In addition to the laws applicable to our customer financing and other operations discussed below, we are or may be subject to the Fair Housing Act and various other federal statutes and regulations. We are also subject to various foreign laws with respect to La Cabana Beach and Racquet Club in Oranjestad, Aruba. In addition, there can be no assurance that in the future, VOIs will not be deemed to be securities subject to regulation as such, which could have a material adverse effect on us. There is no assurance that the cost of complying with applicable laws and regulations will not be significant or that we are in compliance at all times with all applicable laws, including those discussed below. Any failure to comply with current or future applicable laws or regulations could have a material adverse effect on us.

Our sales and marketing of homesites are subject to various consumer protection laws and to the Federal Interstate Land Sales Full Disclosure Act, which establishes strict guidelines with respect to the marketing and sale of land in interstate commerce. The U.S. Department of Housing and Urban Development (“HUD”) enforces this statute. In some instances, we have been exempt from HUD registration requirements because of the size or number of the subdivided parcels and the limited nature of our offerings. In those cases where we determine parcels must be registered to be sold, we file registration materials disclosing information concerning the property, evidence of title and a description of the intended manner of offering and advertising such property. We bear the cost of such registration, which includes legal and filing fees. Many states also have statutes and regulations governing the sale of real estate. Consequently, we regularly consult with counsel regarding requirements for complying with federal, state and local law. We must obtain the approval of numerous governmental authorities for our acquisition and marketing activities; and, changes in local circumstances or applicable laws may necessitate the application for, or the modification of, existing approvals.

Our vacation ownership resorts are subject to various regulatory requirements including state and local approvals. The laws of most states require us to file a detailed offering statement describing our business and all material aspects of the project and sale of VOIs with a designated state authority. Laws in each state where we sell VOIs generally grant the purchaser of a VOI the right to cancel a contract of purchase at any time within a specified rescission period following the earlier of the date the contract was signed or the date the purchaser has received the last of the documents required to be provided by us. Most states have other laws that regulate our activities, including: real estate licensure; sellers of travel licensure; anti-fraud laws; telemarketing laws; prize, gift and sweepstakes laws; and, labor laws. In addition, certain state and local laws may impose liability on property developers with respect to construction defects discovered or repairs made by future owners of such property. Under these laws, we may be required to pay for repairs to the developed property. As required by state laws, we seek to provide our VOI purchasers with a public disclosure statement that contains, among other items, detailed information about the surrounding vicinity, the resort and the

purchaser’s rights and obligations as a VOI owner. The development, management, and operation of our resorts is subject to various federal, state and local laws and regulations, including the Americans with Disabilities Act.

Under various federal, state and local laws, ordinances and regulations, the owner of real property generally is liable for the costs of removal or remediation of certain hazardous or toxic substances located on or in, or emanating from, the property, as well as related costs of investigation and property damage. These laws often impose such liability without regard to whether the owner knew of the presence of such hazardous or toxic substances. The presence of these substances, or the failure to properly remediate these substances if they exist, may adversely affect the owner’s ability to sell or lease a property or to borrow using the real property as collateral. Other federal and state laws require the removal or encapsulation of asbestos-containing material when this material is in poor condition or in the event of construction, demolition, remodeling or renovation. Other statutes may require the removal of underground storage tanks. Noncompliance with these and other environmental, health or safety requirements may result in the need to cease or alter operations at a property.

Our customer financing activities are also subject to extensive regulation, including but not limited to: the Truth-in-Lending Act and Regulation Z; the Fair Housing Act; the Fair Debt Collection Practices Act; the Equal Credit Opportunity Act and Regulation B; the Electronic Funds Transfer Act and Regulation E; the Home Mortgage Disclosure Act and Regulation C; Unfair or Deceptive Acts or Practices and Regulation AA; the Patriot Act; the Right to Financial Privacy Act; the Gramm-Leach-Bliley Act; the Fair and Accurate Credit Transactions Act; and anti-money laundering laws, among others.

During the year ended December 31, 2007, approximately 20% of our VOI sales were generated by marketing to prospective purchasers obtained through internal and affiliated telemarketing efforts. In addition, approximately 12% of our VOI sales during the year ended December 31, 2007, were generated by marketing to prospective purchasers obtained from third-party VOI prospect vendors, many of whom use telemarketing operations to generate these prospects. We attempt to monitor the actions and compliance of these third parties but there are risks associated with their use. In recent years, state regulators have increased legislation and enforcement regarding telemarketing operations, including requiring the adherence to state “do not call” laws. In addition, the Federal Trade Commission has implemented national “do not call” legislation. While we continue to be subject to telemarketing risks and potential liability, we believe that our exposure to adverse impacts from this heightened telemarketing legislation and enforcement has been and will continue to be mitigated in some instances by the use of “permission marketing” techniques, whereby prospective purchasers have granted us permission to contact them in the future. We have implemented procedures which we believe will help reduce the possibility that individuals who have formally requested to the applicable federal or state regulators that they be placed on a “do not call” list are not contacted through one of our in-house or third-party contracted telemarketing operations, although there can be no assurance that such procedures will be effective in ensuring regulatory compliance. These measures have increased and are expected to continue to increase our marketing costs. Through December 31, 2007, we have not been subject to any material fines or penalties as a result of our telemarketing operations but from time to time we have been the subject of proceedings for violation of the “do not call” laws and for violation of state laws applicable to the marketing and sale of VOIs. There is no assurance that we will be able to efficiently or effectively market to prospective purchasers through telemarketing operations in the future or that we will be able to develop alternative sources of prospective purchasers of our VOI products at acceptable costs.

Competition

Bluegreen Resorts competes with various high profile and well-established operators. Many of the world’s most recognized lodging, hospitality and entertainment companies develop and sell VOIs in resort properties. Major companies that now operate or are developing or planning to develop vacation ownership resorts directly or through subsidiaries include Marriott International, Inc., the Walt Disney Company, Hilton Hotels Corporation, Hyatt Corporation, Four Seasons Hotels and Resorts, Starwood Hotels and Resorts Worldwide, Inc. and Wyndham Worldwide Corporation. We also compete with numerous other smaller owners and operators of vacation ownership resorts. In addition to competing for sales leads and prospects, we compete with other VOI developers for marketing, sales, and resort management personnel. We believe that each of our vacation ownership resorts faces the same general competitive conditions. Although, as noted above, Bluegreen Resorts competes with various high profile and well-established operators, we believe that we can compete on the basis of our general reputation, the price, location and quality of our vacation ownership resorts and the flexibility of our Bluegreen Vacation Club product. However, the development and operation of additional vacation ownership resorts by competitors in our markets could have a material adverse impact on the demand for our VOIs and our results of operations.

Bluegreen Communities competes with builders, developers and others for the acquisition of property and with local, regional and national developers, homebuilders and others with respect to the sale of homesites. We believe that each of

our Bluegreen Communities projects faces the same general competitive conditions. We believe that we can compete on the basis of our reputation and the price, location and quality of the products we offer for sale, as well as on the basis of our experience in land acquisition, development, marketing and sale.

Our golf courses face competition for business from other operators of daily fee and, to a lesser extent, private golf courses within the local markets where we operate. Competition in these markets affects the rates that we charge per round of golf, the level of maintenance on the golf courses and the types of additional amenities available to golfers, such as food and beverage operations. We do not believe that such competitive factors have a material adverse impact on our results of operations or financial position.

In our customer financing activities, we compete with banks, mortgage companies, other financial institutions and government agencies offering financing of real estate. For the past several years, we have experienced increased competition with respect to the financing of Bluegreen Communities sales, as evidenced by the low percentage of homesite sales internally financed since 1995.

Website Access to Exchange Act Reports

We post publicly available reports required to be filed with the Securities Exchange Commission (“SEC”) on our website, www.bluegreencorp.com , as soon as reasonably practicable after filing such reports with the SEC. We also make available on our website the beneficial ownership reports (Forms 3, 4 and 5) filed by our officers, directors and other reporting persons under Section 16 of the Securities Exchange Act of 1934 (the “Exchange Act”). Our website and the information contained therein or connected thereto are not incorporated into this Annual Report.

The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. The website address for this site is www.sec.gov .

Personnel

As of December 31, 2007, we had 5,971 employees, 688 of which were located at our headquarters in Boca Raton, Florida, and 5,283 in regional field offices throughout the United States and Aruba (the field personnel include 358 field employees supporting Bluegreen Communities and 4,925 field employees supporting Bluegreen Resorts). Only our employees in Aruba are represented by a collective bargaining unit. We believe that our relations with our employees are satisfactory.

Executive Officers

The following table sets forth certain information regarding our executive officers as of March 1, 2008.


Name	Age	Position


John M. Maloney, Jr.	46	President and Chief Executive Officer

Daniel C. Koscher	50	Senior Vice President; President and Chief Executive Officer of Bluegreen Communities

Anthony M. Puleo	39	Senior Vice President, Chief Financial Officer and Treasurer

David L. Pontius	52	Senior Vice President; President of Bluegreen Resorts

David Bidgood	50	Senior Vice President; Executive Vice President of Sales & Marketing — Bluegreen Resorts

James R. Martin	60	Senior Vice President, General Counsel and Clerk

Susan J. Saturday	48	Senior Vice President and Chief Human Resources Officer

John M. Maloney, Jr. joined us in 2001 as Senior Vice President of Operations and Business Development for Bluegreen Resorts. In May 2002, Mr. Maloney was named our Senior Vice President of the Company and President of Bluegreen Resorts and he was appointed Executive Vice President and Chief Operating Officer in November 2005. Effective January 2007, Mr. Maloney was appointed President and Chief Executive Officer. Prior to Bluegreen, Mr. Maloney served in various positions with ClubCorp, most recently as the Senior Vice President of Sales and Marketing for the Owners Club by ClubCorp, and held various positions with Hilton Grand Vacations Company, most recently as the Director of Sales and Marketing for the South Florida area.

Daniel C. Koscher joined us in 1986. During his tenure, he has served in various financial management positions including Chief Accounting Officer and Vice President and Director of Planning/Budgeting. In 1996, he became Senior Vice President of the Company and President of Bluegreen Communities. In November 2005, Mr. Koscher was elected Chief Executive Officer of Bluegreen Communities. Mr. Koscher holds an M.B.A. along with a B.B.A. in Accounting and is a Registered Resort Professional.

Anthony M. Puleo joined us in 1997 as Chief Accounting Officer. Mr. Puleo was elected Vice President in 1998 and Senior Vice President in 2004. Mr. Puleo served as Interim Chief Financial Officer from April through August 2005. In August 2005, he was elected Chief Financial Officer and Treasurer. From December 1990 through October 1997, Mr. Puleo held various positions with Ernst & Young LLP, most recently serving as a Senior Manager in the Assurance and Advisory Business Services group. Mr. Puleo holds a B.B.A. in Accounting and is a Certified Public Accountant.

David L. Pontius joined us in 2007 as Senior Vice President and President, Bluegreen Resorts. From 2002-2007, Mr. Pontius worked at Wyndham Vacation Ownership, Inc. and its sister company RCI Global Vacation Network (RCI). From 2006-2007, he served as Executive Vice President, Hospitality, Strategic Planning and Chief Customer Officer at Wyndham Vacation Ownership. From 2002-2006, Mr. Pontius served as President and CEO of RCI North America. From 1996-2002, Mr. Pontius served in positions of increasing responsibilities at Hilton Grand Vacations where he finished as Senior Vice President of Operations. From 1992-1996, Mr. Pontius served as Chief Operating Officer of Vacation Internationale, one of the pioneer companies in timesharing and points-based clubs.

David Bidgood joined us in 1997 as Vice President for Bluegreen’s Midwest Region and the Senior Vice President for the Midwest and Tennessee Region with Bluegreen’s acquisition of RDI. In December 2000, Mr. Bidgood was promoted to Senior Vice President, National Sales Director Bluegreen Resorts Division. In 2007, Mr. Bidgood was promoted to Executive Vice President of National Sales and Marketing and became an officer of Bluegreen Corporation. Prior to joining Bluegreen, Mr. Bidgood held a variety of positions and has been involved in all aspects of resort development.

James R. Martin joined us in 2004 as Senior Vice President, General Counsel and Clerk. Prior to joining us, Mr. Martin was a partner with the law firm of Baker & Hostetler LLP since 1985, focusing his practice on real estate, resort

development, vacation ownership, federal and state regulatory matters and commercial and consumer law. Mr. Martin has been involved in the development, structuring, regulation, and operation of vacation ownership resorts since 1978 and holds a B.A. and J. D. degree.

Susan J. Saturday joined us in 1988. During her tenure, she has held various management positions with us including Assistant to the Chief Financial Officer, Divisional Controller and Director of Accounting. In 1995, she was elected Vice President and Director of Human Resources and Administration. In 2004, Ms. Saturday was elected Senior Vice President and Chief Human Resources Officer. From 1983 to 1988, Ms. Saturday was employed by General Electric Company in various financial management positions including the corporate audit staff. Ms. Saturday holds a B.B.A. in Accounting and an M.S. in Human Resource Management.


Item 1A.	RISK FACTORS.

We are subject to various risks and uncertainties relating to or arising out of the nature of our business and general business, economic, financing, legal and other factors or conditions that may affect us. Moreover, we operate in a very competitive, highly regulated and rapidly changing environment. New risk factors emerge from time to time and it is not possible for management to either predict all risk factors, or assess the impact of all risk factors on our business or the extent to which any factor, or combination of factors may affect our business. Investors should also refer to our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K (available on our website and the SEC website) in future periods for updates to these risk factors. These risks and uncertainties include but are not limited to those referred to under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the following:

Our continued liquidity and profitability depends on our ability to sell or borrow against our notes receivable.

We offer financing of up to 90% of the purchase price to purchasers of our VOIs and homesites. Approximately 95% of our VOI customers and approximately 1% of our homesite customers utilized our in-house financing during the year ended December 31, 2007. However, we incur selling, marketing and administrative cash expenditures prior to and concurrent with the sale. These costs generally exceed the down payment we receive at the time of the sale. Accordingly, our ability to borrow against or sell the notes receivable we receive from our customers is a critical factor in our continued liquidity. We are also a party to a number of customary securitization-type transactions under which we sell receivables to a wholly-owned special purpose entity which, in turn, sells the receivables to a trust established for the transaction. We typically recognize gains on the sale of receivables and such gains have comprised a significant portion of our income. In 2007, the markets for notes receivable facilities and receivable securitization transactions were negatively impacted by problems in the residential mortgage markets and credit markets in general and an associated reduction in liquidity which resulted in reduced availability of financing and less favorable pricing. If our pledged receivables facilities terminate or expire and we are unable to replace them with comparable facilities, or if we are unable to continue to participate in securitization-type transactions on acceptable terms, our liquidity, cash flow, and profitability would be materially and adversely affected. If any of our current facilities terminate or expire, there is no assurance that we will be able to negotiate the pledge or sale of our notes receivable at favorable rates, or at all.

We depend on additional funding to finance our operations.

We anticipate that we will finance our future business activities, in whole or in part, with indebtedness that we obtain pursuant to additional borrowings under our existing credit facilities, under credit facilities that we may obtain in the future, under securitizations in which we may participate in the future or pursuant to other borrowing arrangements. However, we cannot assure you that we will be able to obtain sufficient external sources of liquidity on attractive terms, or at all. Moreover, we are, and will be, required to seek continued external sources of liquidity to:


	•	support our operations;

	•	finance the acquisition and development of VOI inventory and residential land;

	•	finance a substantial percentage of our sales; and

	•	satisfy our debt and other obligations.

Our ability to service or to refinance our indebtedness or to obtain additional financing (including our ability to consummate future notes receivable securitizations) depends on the credit markets and on our future performance, which is subject to a number of factors, including our business, results of operations, leverage, financial condition and business prospects, prevailing interest rates, general economic conditions and perceptions about the residential land and vacation ownership industries.

There has been a material deterioration in the sub-prime lending markets which could adversely impact our liquidity and earnings.

Historically, we have not performed and currently we do not perform credit checks or obtain FICO® scores of the purchasers of our VOIs at the time of sale in connection with our financing of their purchases. However, from time to time we obtain FICO® scores on our overall VOI portfolio originated by us and we are aware that a significant portion of the vacation ownership customers we finance are considered “sub-prime borrowers.” Based on a review conducted in January 2008, approximately 31% of VOI borrowers in our serviced loan portfolio had a FICO® score below 620. Although to date we have not experienced a material increase in defaults or delinquencies in our loan portfolio as compared to historical rates, conditions in the sub-prime mortgage industry, including both credit sources as well as borrowers, have been deteriorating. If default rates for our borrowers were to rise, it may require an increase in the provision for loan losses and an impairment of the value of our retained interests in notes receivable

sold. In addition, it may cause buyers of, or lenders whose loans are secured by, our VOI notes receivable to reduce the amount of availability under receivables purchase and credit facilities, or to increase the interest costs associated with such facilities. In such an event, the cost of financing may increase and we may not be able to secure financing on terms acceptable to us, which would adversely affect our earnings, financial position and cash flow.

We would incur substantial losses if the customers we finance default on their obligations.

Under the terms of our pledged and receivable sale facilities, we may be required, under certain circumstances, to replace receivables or to pay down the loan to within permitted loan-to-value ratios. Additionally, the terms of our securitization-type transactions i.) require us to repurchase or replace loans if we breach any of the representations and warranties we made at the time we sold the receivables and ii.) include provisions that in the event of defaults by customers in excess of stated thresholds would require substantially all of our cash flows from our retained interest in the receivable portfolios sold to be paid to the parties who purchased the receivables from us.

Further, if defaults and other performance criteria adversely differ from estimates used to value our retained interests in notes receivable sold in the securitization transactions, we may be required to write down these assets, which could have a material adverse effect on our results of operations. Accordingly, we bear some risks of delinquencies and defaults by buyers who finance the purchase of their VOIs or residential land through us, regardless of whether or not we sell or pledge the buyer’s loan to a third party.

As of December 31, 2007, approximately 4.5% of our vacation ownership receivables and approximately 13.2% of residential land receivables which we held or which third parties held under sales transactions which were originated and are serviced by us were more than 30 days past due. Although in many cases we may have recourse against a buyer for the unpaid purchase price, certain states have laws that limit our ability to recover personal judgments against customers who have defaulted on their loans or the cost of doing so may is not justified. Historically, we have generally not pursued such recourse against our customers. In the case of our VOI receivables, if we are unable to collect the defaulted amount, we traditionally have terminated the customer’s interest in the Bluegreen Vacation Club and then remarketed the recovered VOI. Irrespective of our remedy in the event of a default, we cannot recover the marketing, selling and administrative costs associated with the original sale, and we would have to incur such costs again to resell the VOI or homesite.

Our results of operations and financial condition could be adversely impacted if our estimates concerning our notes receivable are incorrect.

A portion of our revenues historically has been and is expected to continue to be comprised of gains on sales of notes receivable in off-balance sheet arrangements. The amount of any gains recognized and the fair value of the retained interests recorded are based in part on management’s best estimates of future prepayment, default and loss severity rates, discount rates and other considerations in light of then-current conditions. Our results of operations and financial condition could be adversely affected if, among other things:


	•	actual prepayments with respect to loans sold occur more quickly than was projected;

	•	actual defaults and/or loss severity rates with respect to loans sold are greater than estimated;

	•	the portfolio of receivables sold fails to satisfy specified performance criteria; or

	•	market conditions in the securitization market continue to result in a widening of interest spreads, causing the discount rates used to value our retained interest in notes receivable sold to increase.

If any of these situations were to occur, it could cause a decline in the fair value of the retained interests and a charge to earnings currently. Further, in certain events the cash flow on the retained interests in notes receivable sold could be reduced, in some cases, until the outside investors are paid or the regular payment formula was resumed.

The state of the economy generally, interest rates and the availability of financing and increased fuel prices could affect our ability to market VOIs and residential homesites.

Our business may be adversely affected by unfavorable general economic and industry conditions, including the effects of weak domestic and world economies, rising unemployment and job insecurity, housing values and availability of financing, and geopolitical conflicts. Any downturn in economic conditions or any price increases related to the travel and tourism industry, such as higher airfares or increased gasoline prices, could depress discretionary consumer spending and have a material adverse effect on our business. Any such economic conditions, including a recession, may also adversely affect the future availability of attractive financing rates for us or for our customers and may materially adversely affect our business. Furthermore, changes in general economic conditions may adversely affect our ability to collect our receivables from borrower owners. Because our operations are

conducted mainly within the vacation ownership industry, any adverse changes affecting the industry, such as an oversupply of vacation ownership units, a reduction in demand for such units, changes in travel and vacation patterns, changes in governmental regulation of the industry, increases in construction costs, imposition of increased taxes by governmental authorities and negative publicity for the industry, could also have a material adverse effect on our business.

Our success depends on our ability to market our products successfully and efficiently.

We compete for customers with other hotel and resort properties and vacation ownership resorts. Accordingly, the identification of sales prospects and leads, and the marketing of our products to them are essential to our success. We have expended and expect to continue to expend significant amounts of our resources to identify and benefit from future customers and upgrade opportunities. Among our marketing initiatives, we utilize our proprietary computer software system to identify and target leads. The leads we identify are then contacted and given the opportunity to purchase mini-vacation packages which may sometimes combine hotel stays, cruises and gift premiums. Buyers of these mini-vacation packages are then usually required to participate in a vacation ownership sales presentation. We have incurred and will continue to incur the expenses associated with these and our other marketing programs in advance of closing sales to the leads that we identify. If our lead identification and marketing efforts do not yield enough leads or we are able to successfully convert sales leads to a sufficient number of sales, we may be unable to recover the expense of our marketing programs and systems and our business may be adversely affected.

We are subject to the risks of the real estate market and the risks associated with real estate development, including the risks and uncertainties relating to the cost and availability of desirable land, labor and construction materials.

Real estate markets are cyclical in nature and highly sensitive to changes in national and regional economic conditions, including:


	•	levels of unemployment;

	•	levels of discretionary disposable income;

	•	levels of consumer confidence;

	•	the availability of financing;

	•	overbuilding or decreases in demand;

	•	interest rates; and,

	•	federal, state and local taxation methods.

A downturn in the economy in general or in the market for residential land or VOIs could have a material adverse effect on our business. The housing market is currently experiencing a significant correction, the depth and duration of which are as yet unknown. Further, many economists and financial analysts, as well as the media in general, are concerned that a general economic recession has begun or will soon begin in the United States. Both of these circumstances have exerted pressure upon our Bluegreen Communities division and may exert pressure on Bluegreen Resorts in the near term.

In addition, the availability of land at favorable prices for the development of our Bluegreen Resorts and Bluegreen Communities real estate projects is critical to having adequate inventory to sustain or grow our sales volume and maintain an adequate gross profit on our sales to cover our significant selling, general and administrative expenses, cost of capital and other expenses in order to generate favorable results of operations. If we were unable to acquire such land or, in the case of Bluegreen Resorts, resort properties, at a favorable cost, it could have an adverse impact on our results of operations.

Another factor impacting the profitability of our real estate development activities is the cost of construction materials and services. Should the cost of construction materials and services rise, the ultimate cost of our Bluegreen Resorts’ and Bluegreen Communities’ inventories under development could increase and have a material, adverse impact on our results of operations.

Claims for development-related defects could adversely affect our financial condition and operating results.

We engage third-party contractors to construct our resorts and to develop our communities. However, our customers may assert claims against us for construction defects or other perceived development defects, including, without limitation, structural integrity, the presence of mold as a result of leaks or other defects, water intrusion, asbestos, electrical issues, plumbing issues, road construction, water and sewer defects and defects in the engineering of amenities. In addition, certain state and local laws may impose liability on property developers with respect to development defects discovered in the future. We could have to accrue a significant portion of the cost to repair such

defects in the quarter when such defects arise or when the repair costs are reasonably estimable. A significant number of claims for development-related defects could adversely affect our liquidity, financial condition and operating results.

We may not successfully execute our growth strategy .

A principal component of our growth strategy is to acquire additional real estate for the development of VOIs or completed VOIs, preferably in markets that also provide us with incremental sales distribution opportunities. We seek to acquire properties in destinations that we believe will complement our existing operations and serve the best interest of the members of Bluegreen Vacation Club as a whole. In addition, we have to continually acquire additional real estate for Bluegreen Communities to develop and sell in order to sustain our sales volume. Our ability to execute this growth strategy will depend upon a number of factors, including the following:


	•	the availability of attractive real estate opportunities;

	•	our ability to acquire properties for such development opportunities on economically feasible terms and in a timely manner to meet sales demand;

	•	our ability to market and sell VOIs at newly developed or acquired resorts;

	•	our ability to manage newly developed or acquired resorts in a manner that results in customer satisfaction;

	•	our ability to develop, market and sell acquired real estate for Bluegreen Communities in a manner that results in customer satisfaction;

	•	our ability to minimize lead times for new resort sales offices or new communities to provide meaningful incremental revenues at an acceptable profit; and

	•	the availability of capital and our capital structure.

In particular, the success of our Bluegreen Vacation Club will depend upon our ability to continue to acquire and develop a sufficient number of participating resorts to make membership interests attractive to new consumers as well as existing owners and to permit the continued growth of Bluegreen Vacation Club’s membership. There is no assurance that we will be successful with respect to any or all of these factors.

We may face a variety of risks when we expand our operations.

Our growth strategy includes the expansion of the number of our resorts and sales offices. Risks associated with such expansion include the following:


	•	sales may outpace the delivery of completed inventory in a timely manner;

	•	construction costs may exceed original estimates;

	•	land acquisition costs may exceed acceptable and financially feasible levels;

	•	we may be unable to complete construction, conversion or required legal registrations and approvals as scheduled;

	•	we may be unable to control the timing, quality and completion of any construction activity;

	•	the sales pace from a new community may be below our expectations;

	•	our quarterly results may fluctuate due to an increase or decrease in the number of residential land or VOI projects subject to “percentage of completion accounting,” which requires that we recognize profit on projects on a pro rata basis as development is completed;

	•	we may have to provide prospective customers with additional “first-day incentives” to entice them to buy a VOI, which may increase our marketing costs and result in additional revenue deferral under SFAS No. 152;

	•	market demand may not be present;

	•	the value of our inventories may decline;

	•	the cost of carrying inventory on our balance sheet may increase, among other items, interest expense, real estate taxes, developer subsidies and maintenance fees; and

	•	we may be subject to increased regulation when initiating operations in new states, and regulations in states where we currently do business may become more burdensome.

	•	Increased VOI sales require increased availability of receivable sale and/or hypothecation facilities, as well as requires the consummation of future term securitization transactions.

Any of the foregoing, among other factors, could adversely affect profitability in a material way. There is no assurance that we will complete all of the planned expansion of our properties or, if completed, that such expansion will be profitable.

Moreover, to successfully implement our growth strategy, we must integrate the newly acquired or developed properties into our existing sales and marketing programs. During the start-up phase of a new resort sales office or residential community project, we could experience lower operating margins at that project until its operations mature. The lower margins could be substantial and could negatively impact our cash flow. We cannot provide assurance that we will maintain or improve our operating margins as our projects achieve maturity, and our new resort sales offices and communities may reduce our overall operating margins.

We may face additional risks when and if we expand into new markets.

We currently intend to acquire completed VOIs or real estate for the development of VOIs for Bluegreen Resorts both in the geographic areas where Bluegreen Resorts currently operates and in other areas where we anticipate successful sales of homesites in residential communities. Our prior success in the markets in which we currently operate does not ensure our continued success as we acquire, develop or operate future projects in new markets. Accordingly, in connection with expansion into new markets, we may be exposed to a number of additional risks, including the following:


	•	our lack of familiarity and understanding of regional or local consumer preferences;

	•	our inability to attract, hire, train and retain additional sales, marketing and resort staff at competitive costs;

	•	our inability to obtain, or to obtain in a timely manner, necessary permits and approvals from state and local government agencies and qualified construction services at acceptable costs;

	•	our inability to capitalize on new marketing relationships and development agreements at acceptable costs; and,

	•	the uncertainty involved in, and additional costs associated with, marketing VOIs and homesites prior to completion of marketed units.

Bluegreen Communities primarily depends on third party lenders to finance the purchase of homesites as the majority of our residential land sales are currently financed by customers through local banks and finance companies. Because of the problems in the housing market and the associated reduction in liquidity in the credit markets, many lenders are utilizing more stringent underwriting standards and scaling back their lending in general. A decrease in the willingness of such lenders to extend financing to our customers could cause a decline in our sales or require material additional credit facilities in order to enable us to provide financing to our customers.

The resale market for VOIs could adversely affect our business.

Based on our experience at our resorts and at destination resorts owned by third parties, we believe that resales of VOIs generally are made at net sales prices below their original customer purchase prices. The relatively lower sales prices are partly attributable to the high marketing and sales costs associated with the initial sales of such VOIs. Accordingly, the initial purchase of a VOI may be less attractive to prospective buyers. Also, buyers who seek to resell their VOIs compete with our efforts to sell our VOIs. While VOI resale clearing houses or brokers currently do not have a material impact on our business, if a secondary market for VOIs were to become more organized and liquid, the resulting availability of resale VOIs at lower prices could adversely affect our prices and the number of sales we can close, which in turn would adversely affect our business and results of operations.

We may be adversely affected by extensive federal, state and local laws and regulations and changes in applicable laws and regulations, including with respect to the imposition of additional taxes on operations.

The federal government and the states and local jurisdictions in which we conduct business have enacted extensive regulations that affect the manner in which we market and sell VOIs and homesites and conduct our other business operations. In addition, many states have adopted specific laws and regulations regarding the sale of VOIs and homesites. Many states, including Florida and South Carolina, where some of our resorts are located, extensively regulate the creation and management of timeshare resorts, the marketing and sale of timeshare properties, the escrow of purchaser funds prior to the completion of construction and closing, the content and use of advertising materials and promotional offers, the delivery of an offering memorandum and the creation and operation of exchange programs and multi-site timeshare plan reservation systems. Moreover, with regard to sales conducted in the South Carolina, the closing of real estate and mortgage loan transactions must be conducted under the supervision of an attorney licensed in South Carolina. In June 2006, South Carolina enacted the “Time Sharing Transaction Procedures Act” which, among other things, further clarified the process that must be followed in the sale and purchase of timeshare interests. We believe that our procedures have been and are consistent with prior and current South Carolina law. Most states also have other laws that regulate our activities, such as:


	•	timeshare project registration laws;

	•	real estate licensure laws;

	•	mortgage licensure laws;

	•	sellers of travel licensure laws;

	•	anti-fraud laws;

	•	consumer protection laws;

	•	telemarketing laws;

	•	prize, gift and sweepstakes laws; and

	•	consumer credit laws.

We currently are authorized to market and sell VOIs and homesites in all states in which our operations are currently conducted. If our agents or employees violate applicable regulations or licensing requirements, their acts or omissions could cause the states where the violations occurred to revoke or refuse to renew our licenses, which could materially and adversely affect our business, or to render our sales contracts void or voidable.

In addition, the federal government and the states and local jurisdictions in which we conduct business have enacted extensive regulations relating to direct marketing and telemarketing generally, including the federal government’s national “Do Not Call” list. The regulations have impacted our marketing of VOIs, and we have taken steps in an attempt to decrease our dependence on restricted calls. However, these steps have increased and are expected to continue to increase our marketing costs. We cannot predict the impact that these legislative initiatives or any other legislative measures that may be proposed or enacted now or in the future may have on our marketing strategies and results. Further, from time to time, complaints are filed against the Company by individuals claiming that they received calls in violation of the regulation.

Currently, most states have taxed VOIs as real estate, imposing property taxes that are billed to the respective property owners’ associations that maintain the related resorts and have not sought to impose sales tax upon the sale of the VOI or accommodations tax upon the use of the VOI. From time to time, however, various states have attempted to promulgate new laws or apply existing laws impacting the taxation of vacation ownership interests to require that sales or accommodations taxes be collected. Should new state or local laws be implemented or interpreted to impose sales or accommodations taxes on VOIs, our resorts business could be materially adversely affected.

We believe we are in material compliance with applicable federal, state, and local laws and regulations relating to the sale and marketing of VOIs and homesites. From time to time, however, consumers file complaints against us in the ordinary course of our business. We could be required to incur significant costs to resolve these complaints. There is no assurance that we will remain in material compliance with all applicable federal, state and local laws and regulations, or that violations of applicable laws will not have adverse implications for us, including negative public relations, potential litigation and regulatory sanctions. The expense, negative publicity and potential sanctions associated with any failure to comply with applicable laws or regulations could have a material adverse effect on our results of operations, liquidity or financial position.

Environmental liabilities, including claims with respect to mold or hazardous or toxic substances, could have a material adverse impact on our business.

Under various federal, state and local laws, ordinances and regulations, as well as common law, we may be liable for the costs of removal or remediation of certain hazardous or toxic substances, including mold, located on, in or emanating from property that we own, lease or operate, as well as related costs of investigation and property damage at such property. These laws often impose liability without regard to whether we knew of, or were responsible for, the presence of the hazardous or toxic substances. The presence of such substances, or the failure to properly remediate such substances, may adversely affect our ability to sell or lease our property or to borrow money using such real property or receivables generated from the sale of such real property as collateral. Noncompliance with environmental, health or safety requirements may require us to cease or alter operations at one or more of our properties. Further, we may be subject to common law claims by third parties based on damages and costs resulting from violations of environmental regulations or from contamination associated with one or more of our properties.

We could incur costs to comply with laws governing accessibility of facilities by disabled persons.

A number of state and federal laws, including the Fair Housing Act and the Americans with Disabilities Act, impose requirements related to access and use of accommodations and facilities by disabled persons of a variety of public accommodations and facilities. Although we believe our resorts are substantially in compliance with laws governing accessibility by disabled persons, we may incur additional costs to comply with such laws at our existing,

subsequently acquired or managed resorts. Additional federal, state and local legislation with respect to access by disabled persons may impose further burdens or restrictions on us. We cannot forecast the ultimate cost of compliance with such legislation, but such costs could be substantial and, as a result, could have a material adverse effect on our results of operations, liquidity or capital resources.


Item 1B.	UNRESOLVED STAFF COMMENTS.

Not applicable.


Item 2.	PROPERTIES.

Our principal executive office is located in Boca Raton, Florida in approximately 148,290 square feet of leased space. On December 31, 2007, we also maintained seven regional offsite sales offices as well as on the island of Aruba, in addition to sales offices located at 22 of our resorts. For a further description of our resort and communities properties, please see “Item 1. Business — Company Products.”


Item 3.	LEGAL PROCEEDINGS.

Bluegreen Resorts

Tennessee Tax Audit

In 2005, the State of Tennessee Audit Division (the “Division”) audited certain subsidiaries within Bluegreen Resorts for the period from December 1, 2001 through December 31, 2004. On September 23, 2006, the Division issued a notice of assessment for approximately $652,000 of accommodations tax based on the use of Bluegreen Vacation Club accommodations by Bluegreen Vacation Club members who became members through the purchase of non-Tennessee property. We believe the attempt to impose such a tax is contrary to Tennessee law, and intend to vigorously oppose such assessment by the Division. An informal conference was held in early December 2007 to discuss this matter with representatives of the Division. No formal resolution of the issue was reached during the conference and no further action has been initiated yet by the State of Tennessee. While the timeshare industry has been successful in challenging the imposition of sales taxes on the use of accommodations by timeshare owners, there is no assurance that the Company will be successful in contesting the current assessment.

Shore Crest Claim

We filed suit against the general contractor with regard to alleged construction defects at our Shore Crest Vacation Villas resort in South Carolina, including deficiencies in exterior insulating and finishing systems that have resulted in water intrusion; styled Shore Crest Vacation Villas II Owners Association, Inc., Bluegreen Corporation vs. Welbro Constructors, S.C., Inc. et al. Case No.: 04-CP-26-500 and Shore Crest Vacation Villas Owners Association, Inc., Bluegreen Vacations Unlimited, Inc., as successor to Patten Resorts, Inc. and as successor to Bluegreen Resorts, Inc. vs. Welbro Constructors Inc. et al. Case No. 04-CP-26-499 . We estimate that the total cost of repairs to correct the defects will range from $4 million to $6 million. Whether the matter is settled by litigation or by negotiation, it is possible that we may need to participate financially in some way to correct the construction deficiencies and will continue to incur legal and other costs as the matter is pursued. As of December 31, 2007, we had accrued $1.3 million related to this matter.

LeisurePath Vacation Club

product) assert claims for violations of the New Jersey Consumer Fraud Act, fraud, nuisance, negligence and for equitable relief all stemming from the sale and marketing by Vacation Station, LLC of the LeisurePath Travel Services Network. Plaintiffs are seeking the gifts and prizes they were allegedly told by Vacation Station, LLC that they won as part of the sales promotion, and that they be given the opportunity to rescind their agreement with LeisurePath along with a full refund. Plaintiffs further seek punitive damages, compensatory damages, attorneys’ fees and treble damages of unspecified amounts. In February 2007, the Plaintiffs amended the complaint to add two additional Plaintiffs/proposed class representatives, Bruce Doxey and Karen Smith-Doxey. Unlike the initial Plaintiffs who were first contacted by Vacation Station, LLC some seven (7) months after LeisurePath terminated its relationship with Vacation Station, LLC and did not purchase LeisurePath products, the Doxeys purchased a participation in the LeisurePath Travel Services Network. Vacation Station, LLC and its owner have each filed for bankruptcy protection and accordingly the case is being pursued against LeisurePath and Bluegreen Corporation. In the Fall of 2007 the court denied plaintiffs’ request to certify their claims as a class action. Subsequently, the parties negotiated a settlement in an effort to extinguish the claims of persons who purchased the benefits of the Leisure Path Travel Services Network. The parties have reached an agreement in principle to a settlement pursuant to which persons who purchased a participation in the Network from Vacation Station, LLC’s sales office in Hackensack, New Jersey will be allowed to select either: (1) seven consecutive nights of accommodations in a Bluegreen resort located in either Orlando, Las Vegas, or Myrtle Beach to be used by December 31, 2009; or (2) continued memberships and a waiver of their Network membership fees until 2012. In an effort to resolve any claims of individuals who may allege improper soliciting, but did not purchase a participation in the Network, an agreed upon number of three day/two night vacation certificates (for use at the same properties listed above) will be made available. The first non-purchasers who submit a prepared affidavit swearing to the validity of their claim will receive these certificates. Furthermore, Defendants have agreed in principle to a “high-low agreement” with regard to Plaintiffs’ Counsel’s attorney’s fees pursuant to which he will receive a minimum of $150,000.00 and a maximum of $300,000.00 depending upon the Court’s fee award. Incentive payments totaling $13,000.00 will be made to the six named Plaintiffs in the suit. This settlement structure was preliminarily approved by the court on January 18, 2008. A Fairness Hearing for final approval of the proposed settlement will take place on April 18, 2008. As of December 31, 2007, we have accrued $260,000 in connection with this matter, which is equal to the approximate cost of the proposed settlement and the low end of the range in the high-low agreement in accordance with the provisions of the Statement of Financial Accounting Standard No. 5, Accounting for Contingencies .

Bluegreen Communities

Mountain Lakes Mineral Rights

Bluegreen Southwest One, L.P., (“Southwest”), a subsidiary of Bluegreen Corporation, is the developer of the Mountain Lakes subdivision in Texas. In Cause No. #28006; styled Betty Yvon Lesley et a1 v. Bluff Dale Development Corporation, Bluegreen Southwest One. L.P. et al. in the 266th Judicial District Court, Erath County, Texas, the Plaintiffs filed a declaratory judgment action against Southwest seeking to develop their reserved mineral interests in, on and under the Mountain Lakes subdivision. Plaintiffs’ claims are based on property law, oil and gas law, contract and tort theories. The property owners association and some of the individual landowners have filed cross actions against Bluegreen, Southwest and individual directors of the property owners association related to the mineral rights and certain amenities in the subdivision as described below. On January 17, 2007, the court ruled that the restrictions placed on the development that prohibited oil and gas production and development were invalid and not enforceable as a matter of law, that such restrictions do not prohibit the development of Plaintiffs’ prior reserved mineral interests and that Southwest breached its duty to lease the minerals to third parties for development. The Court further ruled that Southwest is the sole holder of the right to lease the minerals to third parties. The order granting the Plaintiffs’ motion was severed into a new cause styled Cause No. 28769 Betty Yvon Lesley et a1 v. Bluff Dale Development Corporation, Bluegreen Southwest One. L.P. et al. in the 266th Judicial District Court, Erath County, Texas. Southwest has appealed the trial court’s ruling. The appeal is styled Bluegreen Southwest One, LP et al. v. Betty Yvon Lesley et al. ; in the 11th Court of Appeals, Eastland, Texas. Bluegreen does not believe that it has material exposure to the property owners association based on the cross claim relating to the mineral rights other than the potential claim for legal fees incurred by the property owners association in connection with the matter. As of December 31, 2007, Bluegreen had accrued $1.5 million in connection with the issues raised related to the mineral rights claims. Separately, one of the amenity lakes in the Mountain Lakes development did not reach the expected level after construction was completed. Owners of homesites within the Mountain Lakes subdivision and the Property Owners Association of Mountain Lakes have asserted cross claims against Southwest and Bluegreen regarding such failure as part of the Lesley litigation referenced above as well as in Cause No. 067-223662-07; Property Owners Association of Mountain Lakes Ranch, Inc. v. Bluegreen Southwest One, L. P., et al. ; in the 67th Judicial District Court of Tarrant County, Texas. Southwest continues to investigate reasons for the delay of the lake to fill and currently estimates that the cost of remediating the condition will be approximately $3.0 million, which was accrued during the year ended December 31, 2006. Additional claims may be pursued in the future in connection with these matters, and it is not possible at this time to estimate the likelihood of loss or amount of potential exposure with respect to any such matters.

In the ordinary course of our business, we become subject to claims or proceedings from time to time relating to the purchase, subdivision, sale or financing of real estate. Additionally, from time to time, we become involved in disputes with existing and former employees, vendors, taxing jurisdictions and various other parties. Unless otherwise described above, we believe that these claims are routine litigation incidental to our business.


I tem 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

None.

PART II


Item 5.	MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER REPURCHASES OF EQUITY SECURITIES.

Our common stock is traded on the New York Stock Exchange (“NYSE”) under the symbol “BXG”. The Chief Executive Officer of the Company has filed a certification which certified to the NYSE that as of the date of the certification he was not aware of any violations by the Company of the Corporate Governance Listing Standards of the NYSE. The following table sets forth, for the periods indicated, the high and low closing price of our common stock as reported on the NYSE:


Price Range

Year Ended December 31, 2006	High		Low

First Quarter	$	17.24	$	12.64
Second Quarter		12.90		11.25
Third Quarter		12.15		11.01
Fourth Quarter		14.04		11.26


Price Range

Year Ended December 31, 2007	High		Low

First Quarter	$	13.10	$	11.07
Second Quarter		12.64		10.94
Third Quarter		12.22		7.02
Fourth Quarter		8.30		6.26

Shareholder Return Performance Graph

The following graph assumes an investment of $100 on December 31, 2002 and thereafter compares the yearly percentage change in cumulative total return to our shareholders with an industry peer group consisting of Marriott International Inc., Starwood Hotels and Resorts Worldwide, Inc., Wyndham Worldwide Corporation, ILX Resorts, and Silverleaf Resorts (“Peer Group”) and a broad market index (the S&P 500). The graph shows performance on a total return (dividend reinvestment) basis. The graph lines connect fiscal year-end dates and do not reflect fluctuations between those dates.

(LINE GRAPH)


	2002		2003		2004		2005		2006		2007

Bluegreen Corporation	$	100.00	$	177.77	$	564.89	$	450.13	$	365.51	$	204.84
S & P 500		100.00		128.68		142.67		149.65		173.28		182.81
Peer Group		100.00		146.67		217.60		237.16		287.24		207.81

There were approximately 884 record holders of our common stock as of February 27, 2008. The number of record holders does not reflect the number of persons or entities holding their stock in “street” name through brokerage firms or other entities.

We did not pay any cash or stock dividends during the years ended December 31, 2006 and 2007. Our Board of Directors

may consider the possibility of paying cash dividends at some point in the future. However, any decision by our Board to pay dividends will be based on our cash position, operating and capital needs and the restrictions discussed below, and there is no assurance that we will pay cash dividends in the foreseeable future. Provisions contained in the Indenture related to our $55.0 million 10.50% Senior Secured Notes due in April 2008 restrict, and the terms of certain of our credit facilities may, in certain instances, limit the payment of cash dividends on our common stock and our ability to repurchase shares.

From time to time, our Board of Directors has adopted and publicly announced a share repurchase program. Repurchases under such programs are subject to the price of our stock, prevailing market conditions, our financial condition and available resources, other investment alternatives and other factors. We are not required to seek shareholder approval of share repurchase programs, have not done so in the past, and do not anticipate doing so in the future, except to the extent we may be required to do so under applicable law. We have not repurchased any shares since the fiscal year ended April 1, 2001. As of December 31, 2007, there were 694,500 shares remaining for purchase under our current repurchase program; however, we have no present plans to acquire these remaining shares in the foreseeable future.

In February 2008, we announced that we intend to pursue a rights offering to our shareholders of up to $100 million of our common stock. We intend to file a registration statement relating to the rights offering in March. While we had $125.5 million of unrestricted cash and cash equivalents at December 31, 2007, the purpose of the rights offering is to further strengthen our balance sheet in light of our $55 million of senior secured notes maturing in April 2008 and to support growth, including growth through strategic acquisitions, all with a view to maximizing shareholder value.

Our shareholders have approved all of our equity compensation plans, which consist of our 1995 Stock Incentive Plan, our 1988 Outside Directors’ Stock Option Plan, our 1998 Non-Employee Director Stock Option Plan and our 2005 Stock Incentive Plan. As of December 31, 2007, only the 2005 Stock Incentive Plan had securities available for future issuance. Information about securities authorized for issuance under our equity compensation plans as of December 31, 2007, is as follows (in thousands, except per option data):


Number of Securities to be Issued Upon Exercise of Outstanding Stock Options	Weighted-Average Exercise Price of Outstanding Stock Options	Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Outstanding Stock Options)


1,938	$11.51	485


Item 6.	SELECTED FINANCIAL DATA.

The selected consolidated financial data set forth below should be read in conjunction with the Consolidated Financial Statements, related notes, and other financial information appearing elsewhere in this Annual Report (dollars in thousands, except per share data).


	As of or for the Years Ended December 31,

	2003		2004		2005		2006		2007

Income Statement Data
Sales of real estate	$	359,344	$	502,408	$	550,335	$	563,146	$	582,758
Other resort and communities operations revenues		55,394		66,409		73,797		63,610		67,411
Interest income		29,898		35,939		34,798		40,765		44,703
Sales of notes receivable (1)		—		25,972		25,226		5,852		(3,378	)
Other income		457		—		—		—		—

Total revenues		445,093		630,728		684,156		673,373		691,494

Income before income taxes, minority interest and cumulative effect of change in accounting principle (1)(4)		35,585		73,266		80,532		62,491		59,215

Income before cumulative effect of change in accounting principle (1)(4)		19,837		42,559		46,551		34,311		31,926
Net income	$	19,837	$	42,559	$	46,551	$	29,817	$	31,926

Earnings per share before cumulative effect of change in accounting principle (1):
Basic	$	0.80	$	1.62	$	1.53	$	1.12	$	1.03
Diluted	$	0.74	$	1.43	$	1.49	$	1.10	$	1.02

Earnings per common share:
Basic	$	0.80	$	1.62	$	1.53	$	0.98	$	1.03
Diluted	$	0.74	$	1.43	$	1.49	$	0.96	$	1.02


	As of or for the Years Ended December 31,

	2003			2004			2005			2006			2007

Balance Sheet Data:
Notes receivable, net	$	213,560		$	152,051		$	127,783		$	144,251		$	160,665
Inventory, net		220,182			205,352			240,969			349,333			434,968
Total assets		646,484			658,411			694,243			854,212			1,039,578
Shareholders’ equity		174,125			261,066			313,666			353,023			385,108
Book value per common share	$	6.98		$	8.63		$	10.31		$	11.44		$	12.34

Selected Operating Data:
Weighted-average interest rate on notes receivable at period end		14	%		14	%		15	%		14	%		14	%

Bluegreen Resorts statistics:

VOI sales (3)	$	254,971		$	310,608		$	358,240		$	399,105		$	453,541
Gross margin on VOI sales		80	%		76	%		78	%		78	%		75	%
Selling, general and administrative expenses as a percentage of VOI sales		59	%		58	%		61	%		67	%		64	%
Field operating profit (1)	$	50,359		$	50,876		$	59,578		$	53,937		$	69,909
Number of resorts at period end		17			18			21			21			23
Number of VOI sale transactions (2)		26,839			31,574			37,605			41,097			42,768

Bluegreen Communities statistics:

Homesite sales	$	104,373		$	191,800		$	192,095		$	164,041		$	129,217
Gross margin on homesite sales		45	%		45	%		48	%		45	%		48	%
Selling, general and administrative expenses as a percentage of homesite sales		32	%		25	%		24	%		24	%		30	%
Field operating profit (1)	$	12,580		$	37,722		$	47,227		$	35,824		$	23,633
Number of homesites sold (2)		1,962			2,765			2,287			1,750			1,301


(1)	Field operating profit is operating profit prior to the allocation of corporate overhead, interest income, sales of notes receivable, other income, provision for loan losses (for years prior to the implementation of SFAS No. 152), interest expense, income taxes, minority interest and cumulative effect of change in accounting principles. See Note 19 of the Notes to Consolidated Financial Statements for further information.

(2)	“Number of VOI sale transactions” and “number of homesites sold” include those sales made during the applicable period where recognition of revenue is deferred under the percentage-of-completion method of accounting and under SFAS No. 152, as applicable. See “Revenue Recognition and Contracts Receivable” under Note 1 of the Notes to Consolidated Financial Statements.

(3)	Effective January 1, 2006 we adopted the provisions of SFAS No. 152, which changed many aspects of timeshare accounting, including revenue recognition, inventory costing, and accounting for incidental operations. Also, SFAS No. 152 requires that a significant portion of our gains on sales of notes receivable be included in sales of real estate. In 2006 and 2007, the gains on sales of notes receivable were $38.8 million and $42.8 million, respectively. The adoption of SFAS No. 152 resulted in an after-tax charge of $4.5 million in 2006, reflected as a cumulative effect of change in accounting principle.


Item 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Certain Definitions, Cautionary Statement Regarding Forward-Looking Statements

The following discussion of our results of operations and financial condition should be read in conjunction with our Consolidated Financial Statements and related Notes and other financial information included elsewhere in this Annual Report. Unless otherwise indicated in this discussion (and throughout this Annual Report), references to “real estate” and to “inventories” collectively encompass the inventories held for sale by Bluegreen Resorts and Bluegreen Communities.

We desire to take advantage of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 and are making the following statements to do so. Certain statements in this Annual Report and our other filings with the SEC constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. You may identify these statements by forward-looking words such as “may,” “intend,” “expect,” “anticipate,” “believe”, “will,” “should,” “project,” “estimate,” “plan” or other comparable terminology or by other statements that do not relate to historical facts. All statements, trend analyses and other information relative to the market for our products, remaining life-of -project sales, our expected future sales, financial position, operating results, liquidity and capital resources, our business strategy, financial plan and expected capital requirements as well as trends in our operations, receivables performance or results are forward-looking statements. These forward-looking statements are subject to known and unknown risks and uncertainties, many of which are beyond our control, including changes in economic conditions, generally, in areas where we operate, or in the travel and tourism industry, availability of financing, increases in interest rates, changes in regulations and other factors discussed throughout our SEC filings, including the Risk Factor section of this Annual Report, all of which could cause our actual results, performance or achievements, or industry trends, to differ materially from any future results, performance, or achievements or trends expressed or implied herein. Given these uncertainties, investors are cautioned not to place undue reliance on these forward-looking statements and no assurance can be given that the plans, estimates and expectations reflected herein will be achieved. Factors that could adversely affect our future results can also be considered general risk factors with respect to our business, whether or not they relate to a forward-looking statement. We wish to caution you that the important factors set forth below and elsewhere in this report in some cases have affected, and in the future could affect, our actual results and could cause our actual consolidated results to differ materially from those expressed in any forward-looking statements.

Executive Overview

We operate through two business segments – Bluegreen Resorts and Bluegreen Communities. Bluegreen Resorts develops, markets and sells VOIs for inclusion in the Bluegreen Vacation Club, and provides resort management services to resort property owners associations. Bluegreen Communities acquires large tracts of real estate, which it subdivides, improves (in some cases to include a golf course on the property and other related amenities) and sells, typically on a retail basis, as homesites.

We have historically experienced and expect to continue to experience seasonal fluctuations in our gross revenues and net earnings. This seasonality may cause significant fluctuations in our quarterly operating results, with the majority of our gross revenues and net earnings historically expected to occur in the quarters ending in September and December each year. Although we expect to see more potential customers at our sales offices during the quarters ending in June and September, ultimate recognition of the resulting sales during these periods may be delayed due to complex down payment requirements for purchases under GAAP or due to the timing of development and the requirement that we use the percentage-of-completion method of accounting. We expect that we will continue to invest in projects that will require substantial development (with significant capital requirements), and as a consequence, our results of operations may fluctuate significantly between quarterly and annual periods as a result of the required use of the percentage-of-completion method of accounting.

We believe that inflation and changing prices have materially impacted our revenues and results of operations, specifically due to periodic increases in the sales prices of our VOIs and homesites and continued increases in construction and development costs. We expect the increased construction and development costs over the past few years to result in an increase in our cost of sales for the foreseeable future. There is no assurance that we will be able to continue to increase our sales prices or that increased construction costs will not have a material adverse impact on our gross margin. In addition, to the extent that inflation in general or increased prices for our VOIs and homesites would adversely impact consumer sentiment, our results of operations could be adversely impacted. Also, to the extent inflationary trends or other factors affect interest rates, a portion of our debt service costs may increase.

During 2007 our Communities business was adversely impacted by the slow real estate market. Although to date we have not experienced a material reduction in selling prices, in certain markets we experienced a decrease in demand and hence a decrease in sales volume.

We recognize revenue on homesite and VOI sales when a minimum of 10% of the sales price has been received in cash, the refund or rescission period has expired, collectibility of the receivable representing the remainder of the sales price is reasonably assured and we have completed substantially all of our obligations with respect to any development of the real estate sold. Refund or rescission periods include those required by law and those provided for in our sales contracts. With respect to VOI sales, the revenue recognition rules require that incentives and other similarly treated items such as customer down payment equity earned through our Sampler Program be considered in calculating the required down payment for our VOI sales. If, after considering the value of sales incentives provided, the required 10% of sales price down payment threshold is not met, the VOI sale and the related cost of sale and direct selling costs are deferred and not recognized until the buyer’s commitment test is satisfied, generally through the receipt of required mortgage note payments from the buyer. Further, in cases where all development has not been completed, recognition of income is subject to the percentage-of-completion method of accounting.

Costs associated with the acquisition and development of vacation ownership resorts and residential communities, including carrying costs such as interest and taxes, are capitalized as inventory and are allocated to cost of real estate sold as the respective revenues are recognized.

A significant portion of our revenues historically has been, and is expected to continue to be, comprised of gains on sales of notes receivable. By way of example, in 2007, gains on sales of receivables comprised approximately 95%, 0%, 95%, and 82% of our consolidated net income in the quarters ended March 31, 2007, June 30, 2007, September 30, 2007, and December 31, 2007, respectively. The gains are recorded on our consolidated statement of income and the related retained interests in the notes receivable sold are recorded on our consolidated balance sheet at the time of sale. Deterioration in the credit markets has made it more difficult to consummate term securitization transactions on acceptable terms, if at all. In addition, a portion of the gains on sales of receivables in the first quarter and the fourth quarter of 2007 related to sales under our 2006 receivables purchase facility with General Electric Real Estate, which was fully utilized in the fourth quarter of 2007. Absent the consummation of appropriately structured off-balance sheet receivable sales transactions, our results of operations in certain quarters could be materially, adversely affected.

Effective January 1, 2006, the portion of the gains on sales of notes receivable related to the reversal of previously recorded allowances for loan losses on the receivables sold is recorded as a component of revenue on sales of VOIs. The amount of gains recognized and the fair value of the retained interests recorded are based in part on management’s best estimates of future prepayment rates, default rates, loss severity rates, discount rates and other considerations in light of then-current conditions. If actual prepayments with respect to loans occur more quickly than we projected at the time such loans were sold, as can occur when interest rates decline, interest income would be less than expected and may cause a decline in the fair value of the retained interests and a charge to operations. If actual defaults or other factors discussed above with respect to loans sold are greater than estimated, charge-offs would exceed previously estimated amounts and the cash flow from the retained interests in notes receivable sold would decrease. Also, to the extent the portfolio of receivables sold fails to satisfy specified performance criteria (as may occur due to, for example, an increase in default rates or loan loss severity) or certain other events occur, the funds received from obligors must be distributed on an accelerated basis to investors. If the accelerated payment formula were to become applicable, the cash flow to us from the retained interests in notes receivable sold will be reduced until the outside investors were paid or the regular payment formula was resumed. In addition, from time to time, we may agree to defer receiving all or a portion of our deferred payment on certain of our retained interests in notes receivable sold in an accommodation to third party rating agencies. Also, as market conditions change, the discount rates that we use to value our retained interests in notes receivable sold may change. If these situations occur, it could cause a material decline in the fair value of the retained interests and a charge to earnings currently. There is no assurance that the carrying value of our retained interests in notes receivable sold will be fully realized or that future loan sales will be consummated or, if consummated, result in gains. See “VOI Receivables Purchase Facilities – Off Balance Sheet Arrangements,” below.

In addition, we have historically sold VOI notes receivables to financial institutions through warehouse purchase facilities to monetize the receivables while accumulating receivables for a future term securitization transaction. We are currently structuring and intend to structure future warehouse purchase facilities so that sales of VOI receivables through these facilities will be accounted for as on-balance sheet borrowings rather than as off-balance sheet sales. Therefore, we will not recognize a gain on the sales of receivables transferred to the warehouse purchase facilities until such receivables are subsequently included in a properly structured term securitization transaction. If the timing of our

term securitizations or securitization-type transactions changes from prior history, it will impact quarterly patterns as compared to comparable prior periods.

During 2007, the deteriorating credit market, primarily driven by the sub-prime loan crisis, impacted our operations. Although we were able to secure financing and securitize our VOI notes receivable, such transactions were more difficult to effect and were priced at a higher cost than recent years.

Effective January 1, 2006, we adopted the provisions of SFAS No. 152, Accounting for Real Estate Time-Sharing Transactions , which changes the rules for many aspects of timeshare accounting, including revenue recognition, inventory costing and incidental operations (See Note 2 of the financial statements for more information on SFAS No. 152 and its impact on our financial statements). We recognized a $4.5 million or $0.14 per diluted share charge for the cumulative effect of a change in accounting principle, net of income tax and minority interest in 2006, for the adoption of SFAS No. 152.

Critical Accounting Policies and Estimates

Our discussion and analysis of results of operations and financial condition are based upon our consolidated financial statements, which have been prepared in accordance with United States generally accepted accounting principles. The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of commitments and contingencies. On an ongoing basis, management evaluates its estimates, including those that relate to the recognition of revenue, including revenue recognition under the percentage-of-completion method of accounting; our reserve for loan losses; the valuation of retained interests in notes receivable sold and the related gains on sales of notes receivable; the recovery of the carrying value of real estate inventories, golf courses, intangible assets and other assets; and the estimate of contingent liabilities related to litigation and other claims and assessments. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ materially from these estimates under different assumptions and conditions. If actual results significantly differ from management’s estimates, our results of operations and financial condition could be materially, adversely impacted.

We believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of our consolidated financial statements (see also Note 1 of the Notes to Consolidated Financial Statements):


•	Revenue Recognition and Inventory Cost Allocation . In accordance with the requirements of SFAS No. 66, Accounting for Sales of Real Estate, as amended by SFAS No. 152 regarding VOI sales, we recognize revenue on VOI and homesite sales when a minimum of 10% of the sales price has been received in cash (buyer’s commitment), the legal rescission period has expired, collectibility of the receivable representing the remainder of the sales price is reasonably assured and we have completed substantially all of our obligations with respect to any development related to the real estate sold. We believe that we use a reasonably reliable methodology to estimate the collectibility of the receivables representing the remainder of the sales price of real estate sold. See the further discussion of our policies regarding the estimation of credit losses on our notes receivable below. Should we become unable to reasonably estimate the collectibility of our receivables, we may have to defer the recognition of sales and our results of operations could be negatively impacted. Upon the adoption of SFAS No. 152 on January 1, 2006, the calculation of the adequacy of the buyer’s commitment changed so that cash received towards the purchase of our VOIs is reduced by the value of certain incentives provided to the buyer at the time of sale. If, after consideration of the value of the incentive, the total down payment received from the buyer is less than 10% of the sales price, the VOI sale, and the related cost of sales and direct selling expenses, are deferred until such time that sufficient cash is received from the customer, generally through receipt of mortgage payments. Changes to the quantity, type, or value of sales incentives that we provide to buyers of our VOIs may result in additional VOI sales being deferred, and thus our results of operations could be materially, adversely impacted.

	In cases where all development has not been completed, we recognize revenue in accordance with the percentage-of-completion method of accounting. Should our estimates of the total anticipated cost of completing Bluegreen Resorts’ or Bluegreen Communities’ projects increase, we may be required to defer a greater amount of revenue or may be required to defer revenue for a longer period of time, and thus our results of operations could be materially, adversely impacted.


	In accordance with SFAS No. 67, Accounting for Costs and Initial Rental Operations of Real Estate Projects, the capitalized costs of our real estate projects are assigned to individual homesites in the Communities’ projects based on the relative estimated sales value of each homesite. Prior to 2006 this method of allocation was also used to determine the inventory value and related costs of sales for our VOIs. Effective January 1, 2006, as a result of the adoption of SFAS No. 152, VOI inventory and cost of sales is accounted for using the relative sales value method. Under the relative sales value method, cost of sales is calculated as a percentage of net sales using a cost-of-sales percentage—the ratio of total estimated development cost to total estimated VOI revenue, including the estimated incremental revenue from the resale of VOI inventory repossessed, generally as a result of the default of the related receivable. Should our estimates of the sales values of our VOI and homesite inventories differ materially from their ultimate selling prices, our gross profit could be adversely impacted.

•	Allowance for Loan Losses. Prior to January 1, 2006, we estimated credit losses on our notes receivable portfolios generated in connection with the sale of VOIs and homesites in accordance with SFAS No. 5, Accounting for Contingencies, as our notes receivable portfolios consisted of large groups of smaller-balance, homogeneous loans. Consistent with Staff Accounting Bulletin No. 102, Selected Loan Loss Allowance Methodology and Documentation Issues, we first segmented our notes receivable by identifying risk characteristics that are common to groups of loans and then estimated credit losses based on the risks associated with these segments. Under this method, the amount of loss was reduced by the estimated value of the defaulted inventory to be recovered. Although this policy continues for notes receivable generated in connection with the sale of homesites, effective January 1, 2006, we changed our accounting for loan losses for VOI notes receivable in accordance with SFAS No. 152. Under SFAS No. 152, we estimate uncollectibles based on historical uncollectibles for similar VOI notes receivable over the applicable historical period. We use a static pool analysis, which tracks uncollectibles for each year’s sales over the entire life of those notes. We also consider whether the historical economic conditions are comparable to current economic conditions. Additionally, under SFAS No. 152 no consideration is given for future recoveries of defaulted inventory in the estimate of uncollectible VOI notes receivable. We review our reserve for loan losses on at least a quarterly basis.

	The table below sets forth the activity in our allowance for uncollectible notes receivable for the year ended December 31, 2007 (in thousands):


Balance, December 31, 2006	$	13,499
Provision for loan losses (1)		65,419

Less: Allowance on sold receivables		(42,750	)

Less: Write-offs of uncollectible receivables		(18,710	)

Balance, December 31, 2007	$	17,458

(1) Includes provision for loan losses on homesite notes receivable

The average annual default rates and delinquency rates (31 or more days past due) on Bluegreen Resorts’ and Bluegreen Communities’ receivables owned or serviced by us were as follows:


Average Annual Default Rates	Year Ended December 31,


Division	2005		2006		2007

Bluegreen Resorts	8.5	%	7.5	%	7.4	%
Bluegreen Communities	2.9	%(1)	3.6	%	4.6	%


Delinquency Rates	As of December 31,


Division	2005		2006		2007

Bluegreen Resorts	5.9	%	4.0	%	4.5	%
Bluegreen Communities	12.0	%	7.8	%	13.2	%


(1)	Excludes December 2005 default of a $1.3 million note receivable not made in the ordinary course of business.


	Substantially all defaulted VOI notes receivable result in the holder of the note receivable acquiring the related VOI that secured the note receivable. In cases where we have retained or required ownership of the VOI notes receivable, the VOI is acquired and resold in the normal course of business.

•	Transfers of Financial Assets. When we transfer financial assets to third parties, such as when we sell VOI notes receivable pursuant to our vacation ownership receivables purchase facilities, we evaluate whether or not such transfer should be accounted for as a sale pursuant to SFAS No. 140 and related interpretations. The evaluation of sale treatment under SFAS No. 140 involves legal assessments of the transactions, which include determining whether the transferred assets have been isolated from us (i.e., put presumptively beyond our reach or the reach of our creditors, even in bankruptcy or other receivership), determining whether each transferee has the right to pledge or exchange the assets it received, and ensuring that we do not maintain effective control over the transferred assets through either (1) an agreement that both entitles and obligates us to repurchase or redeem them before their maturity or (2) the ability to unilaterally cause the holder to return specific assets (other than through a cleanup call). We believe that we have obtained appropriate legal opinions and other guidance deemed necessary to properly account for our transfers of financial assets as sales in accordance with SFAS No. 140.

	In connection with the sales of notes receivable referred to above, we retain subordinated tranches and rights to excess interest spread, which are retained interests in the notes receivable sold. Gain or loss on the sale of the notes receivable depends in part on the allocation of the previous carrying amount of the financial assets involved in the transfer between the assets sold and the retained interests based on their relative fair value at the date of transfer. We initially and periodically estimate the fair value of our retained interest in notes receivable sold based on the present value of future expected cash flows using management’s best estimates of the key assumptions — prepayment rates, loss severity rates, default rates and discount rates commensurate with the risks involved. Should our estimates of these key assumptions change or should the portfolios sold fail to satisfy specified performance criteria and therefore trigger provisions whereby outside investors in the portfolios are paid on an accelerated basis, there could be a reduction in the fair value of the retained interests and our results of operations and financial condition could be materially and adversely impacted. During the year ended December 31, 2007, we recognized an other-than-temporary decrease of approximately $2.4 million in the fair market value of our retained interest in notes receivable sold. The overall decrease in the fair value of our retained interest in notes receivable sold in 2007 reflects an increase in the discount rates applied to estimated future cash flows on our retained interests as a result of the overall increase in return required by investors in our securitization transactions due to the deteriorating credit market in the second half of 2007.

•	Asset Impairment. We periodically evaluate the recovery of the carrying amounts of our long-lived assets including our real estate properties under the guidelines of SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. Factors that we consider in making this evaluation include our estimates of remaining life-of-project sales for each project based on current retail prices and our estimates of costs to complete each project. Should our estimates of these factors change, our results of operations and financial condition could be adversely impacted.

•	Goodwill. Goodwill is not amortized but is subject to an annual impairment test in accordance with SFAS No. 142, Accounting for Goodwill and Other Intangible Assets. Goodwill is tested for impairment on an annual basis by estimating the fair value of the reporting unit to which the goodwill or intangible assets have been assigned. As of December 31, 2006 and 2007, only our Bluegreen Resorts reporting unit had any recorded goodwill. Should our estimates of the fair value of our reporting units change, our results of operations and financial condition could be adversely impacted.

•	Recent Accounting Pronouncements Not Yet Adopted. In September 2006, the FASB issued FAS No. 157, Fair Value Measurements (“SFAS No. 157”). SFAS No. 157 defines fair value, establishes a methodology for measuring fair value, and expands the required disclosure for fair value measurements. SFAS No. 157 is effective for us beginning with our 2008 fiscal year, at which time it will be applied prospectively. In February 2008, the FASB agreed to partially defer the effective date, for one year, of SFAS No. 157, for non-financial assets and liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis. We are currently evaluating the impact that FAS No. 157 will have on our financial statements.

	In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities Including an Amendment of FASB Statement No. 115 (“SFAS No. 159”). SFAS No. 159 permits entities to choose to measure many financial instruments and certain other items at fair value and is effective for us beginning with our 2008 fiscal year. We do not expect to elect the fair value measurement option for any financial assets or liabilities at the present time.


	On December 4, 2007, the FASB issued SFAS No. 141 (Revised 2007), Business Combinations (“SFAS No. 141(R)”). SFAS No. 141(R) will significantly change the accounting for business combinations. Under SFAS No. 141(R), an acquiring entity will be required to recognize all the assets acquired and liabilities assumed in a transaction at the acquisition-date fair value with limited exceptions. SFAS No. 141(R) also includes a substantial number of new disclosure requirements. SFAS No. 141(R) applies to us prospectively to business combinations for which the acquisition date is on or after January 1, 2009. We are currently evaluating the impact that SFAS No. 141(R) will have on our financial statements.

	On December 4, 2007, the FASB issued SFAS No. 160, Non-controlling Interests in Consolidated Financial Statements-an Amendment of Accounting Research Bulletin (“ARB”) No. 51 (“SFAS No. 160”). SFAS No. 160 establishes new accounting and reporting standards for a non-controlling interest in a subsidiary and for the deconsolidation of a subsidiary. Specifically, this statement requires the recognition of a non-controlling interest (minority interest) as equity in the consolidated financial statements separate from the parent’s equity. The amount of net income attributable to the non-controlling interest will be included in consolidated net income on the face of the income statement. SFAS No. 160 clarifies that changes in a parent’s ownership interest in a subsidiary that do not result in deconsolidation are equity transactions if the parent retains its controlling financial interest. In addition, this statement requires that a parent recognize a gain or loss in net income when a subsidiary is deconsolidated. Such gain or loss will be measured using the fair value of the non-controlling equity investment on the deconsolidation date. SFAS No. 160 also includes expanded disclosure requirements regarding the interests of the parent and its non-controlling interest. SFAS No. 160 is effective for us beginning with our 2009 fiscal year. We are currently evaluating the impact that SFAS No. 160 will have on our financial statements.

Results of Operations

We review financial information, allocate resources and manage our business as two segments - Bluegreen Resorts and Bluegreen Communities. The information reviewed is based on internal reports and excludes an allocation of general and administrative expenses attributable to corporate overhead. The information provided is based on a management approach and is used by us for the purpose of tracking trends and changes in results. It does not reflect the actual economic costs, contributions or results of operations of the segments as stand alone businesses. If a different basis of presentation or allocation were utilized, the relative contributions of the segments might differ but the relative trends, in our view, would likely not be materially impacted. The table below sets forth our financial results by segment.


	Bluegreen Resorts					Bluegreen Communities					Total

	Amount			Percentage of Sales		Amount			Percentage of Sales		Amount			Percentage of Sales

	(dollars in thousands)

Year Ended December 31, 2005: (1)

Sales of real estate	$	358,240		100	%	$	192,095		100	%	$	550,335		100	%
Cost of real estate sales		(77,455	)	(22	)		(100,345	)	(52	)		(177,800	)	(32	)

Gross profit		280,785		78			91,750		48			372,535		68
Other resort and communities operations revenues		64,276		18			9,521		5			73,797		13
Cost of other resort and communities operations		(68,633	)	(19	)		(8,684	)	(5	)		(77,317	)	(14	)
Selling and marketing expenses		(195,407	)	(54	)		(33,588	)	(17	)		(228,995	)	(42	)
Field general and administrative expenses (2)		(21,443	)	(6	)		(11,772	)	(6	)		(33,215	)	(6	)

Field operating profit	$	59,578		17	%	$	47,227		25	%	$	106,805		19	%


Year Ended December 31, 2006: (1)

Gross sales of real estate	$	419,754				$	164,041				$	583,795
Estimated uncollectible VOI notes receivable		(59,497	)				—					(59,497	)
Gain on sales of notes receivable (Resort sales portion)		38,848					—					38,848

Sales of real estate		399,105		100	%		164,041		100	%		563,146		100	%
Cost of real estate sales		(88,086	)	(22	)		(90,968	)	(55	)		(179,054	)	(32	)

Gross profit		311,019		78			73,073		45			384,092		68
Other resort and communities operations revenues		51,688		13			11,922		7			63,610		11
Cost of other resort and communities operations		(42,417	)	(10	)		(10,776	)	(6	)		(53,193	)	(9	)
Selling and marketing expenses		(239,788	)	(60	)		(27,636	)	(17	)		(267,424	)	(47	)
Field general and administrative expenses (2)		(26,565	)	(7	)		(10,759	)	(7	)		(37,324	)	(7	)

Field operating profit	$	53,937		14	%	$	35,824		22	%	$	89,761		16	%


	Bluegreen Resorts					Bluegreen Communities					Total

	Amount			Percentage of Sales		Amount			Percentage of Sales		Amount			Percentage of Sales

	(dollars in thousands)

Year Ended December 31, 2007: (1)

Gross sales of real estate	$	476,033				$	129,217				$	605,250
Estimated uncollectible VOI notes receivable		(65,242	)				—					(65,242	)
Gain on sales of notes receivable (Resort sales portion)		42,750					—					42,750

Sales of real estate		453,541		100	%		129,217		100	%		582,758		100	%
Cost of real estate sales		(111,480	)	(25	)		(67,251	)	(52	)		(178,731	)	(31	)

Gross profit		342,061		75			61,966		48			404,027		69
Other resort and communities operations revenues		53,624		12			13,787		11			67,411		12
Cost of other resort and communities operations		(36,588	)	(8	)		(13,394	)	(11	)		(49,982	)	(8	)
Selling and marketing expenses		(260,932	)	(58	)		(27,934	)	(22	)		(288,866	)	(50	)
Field general and administrative expenses (2)		(28,256	)	(6	)		(10,792	)	(8	)		(39,048	)	(7	)

Field operating profit	$	69,909		15	%	$	23,633		18	%	$	93,542		16	%



(1)	We adopted SFAS No. 152 on January 1, 2006, which, among other things, required us to net estimated uncollectible VOI notes receivable from sales of real estate and include a significant portion of our gains on sales of notes receivable in sales of real estate. We were not permitted to retrospectively apply SFAS No. 152 to periods prior to January 1, 2006.

(2)	General and administrative expenses attributable to corporate overhead have been excluded from the tables. Corporate general and administrative expenses totaled $38.0 million, $52.2 million and $49.6 million for the years ended December 31, 2005, 2006, and 2007, respectively. See “Corporate General and Administrative Expenses,” below, for further discussion.

Sales and Field Operations. Consolidated sales of real estate were $550.3 million, $563.1 million and $582.8 million for 2005, 2006, and 2007, respectively. Consolidated sales of real estate increased 2% from 2005 to 2006 and 3% from 2006 to 2007.

Bluegreen Resorts. During 2005, 2006, and 2007, sales of VOIs contributed $358.2 million (65%), $399.1 million (71%), and $453.5 million (78%) of our total consolidated sales of real estate, respectively.

The following table sets forth certain information for sales of VOIs for the periods indicated, before giving effect to the percentage-of-completion method of accounting and the deferral of sales in accordance with SFAS No. 152.


	Year ended

	December 31, 2005		December 31, 2006		December 31, 2007

Number of VOI sale transactions		37,605		41,097		42,768
Average sales price per transaction	$	9,834	$	10,507	$	11,124

Year ended December 31, 2007 compared to the year ended December 31, 2006

Bluegreen Resorts’ net sales of real estate increased $54.4 million, or 14%, during 2007 as compared to 2006 as a result of higher sales of VOIs and higher gains on sales of VOI notes receivable, partially offset by an increase in estimated uncollectible VOI notes receivable.

Gross VOI sales increased $56.3 million, or 13%, driven primarily by our continued focus on marketing to our growing Bluegreen Vacation Club owner base. Sales to owners increased by 32% and accounted for 41% of Resorts’ sales

during 2007 as compared to 34% during 2006. Also contributing to higher 2007 sales was same-resort sales increases at many of our sales offices. Same-resort sales increased by almost 8% during 2007 as compared to 2006 and were highlighted by increases in sales originating at the Smoky Mountain Preview Center in Sevierville, Tennessee, The Falls Village™ resort in Branson, Missouri, MountainLoft™ in Gatlinburg, Tennessee, and an offsite sales office in Las Vegas, Nevada. Higher sales were also attributable, to a lesser extent, to the opening of new sales offices at SeaGlass Tower™, located in Myrtle Beach, S.C., and at a new resort under development in Williamsburg, Virginia, as well as an 8% system-wide price increase that went into effect during March 2007. These factors, combined with a 5% overall increase in the number of sales prospects seen by Bluegreen Resorts from approximately 310,200 prospects during 2006 to approximately 325,800 prospects during 2007, and a relatively consistent, overall sale-to-tour conversion ratio of 13% during these periods, contributed to the overall sales increase during 2007 as compared to 2006. Our sale-to-tour conversion ratio for new prospects (i.e., excluding sales to our existing owners) was 10% during both 2006 and 2007. The increase in the average sales price per transaction, primarily due to the system-wide price increase, also contributed to higher VOI sales. As required under SFAS No. 152, approximately $38.8 million and $42.8 million of gain on sales of VOI notes receivable in 2006 and 2007, respectively, are reflected as an increase to VOI sales. The majority of these gains represent the reversal of amounts previously recognized as estimated uncollectible VOI notes receivable. The increase in gain on sale of VOI notes receivable in 2007 as compared to 2006 represents the sale of $266.9 million of loans in 2007 compared to $243.6 million in 2006.

The increase in VOI revenue and gains on sales of VOI notes receivable were partially offset by an increase of $5.7 million, or 10%, in the estimated uncollectible VOI notes receivable primarily due to higher VOI sales in 2007 as compared to 2006.

Bluegreen Resorts’ gross margin percentages vary between periods based on the relative costs of the specific VOIs sold in each respective period. As compared to the 78% gross margin earned in 2006, our gross margin of 75% for 2007 was negatively impacted by a higher proportion of sales of VOIs in 2007 of relatively higher cost resorts as compared to 2006. Overall gross margins on VOIs sold in 2007 decreased compared to previous periods reflecting the higher costs of acquiring and developing properties. Acquisition and development costs may continue to increase in future periods and, as a result, we may not be able to earn current or historical gross margins. In addition, upgrade sales to existing owners typically yield a lower gross margin as we offer more favorable pricing for larger cumulative purchases.

Other resort operations revenues increased $1.9 million, or 4%, during 2007 as compared to 2006. The increase in 2007 represented higher fees earned by our resort management company for resort management and other related services. Overall resort management and related fees increased in the aggregate due to an increase in the number of resorts and owners for which we provide management and related services. Fees earned in 2007 by our wholly-owned title company were consistent with those earned in 2006.

Cost of other resort operations decreased $5.8 million, or 14%, during 2007 as compared to 2006. The decrease reflects an increase in rental proceeds earned in connection with the rental of unsold VOIs as well as an increase in Sampler stays, both of which are recorded as a reduction to cost of other resort operations. These reductions were partially offset by higher maintenance fees and subsidies paid on VOIs in inventory relative to the property owners’ associations that maintain our resorts. These subsidies increased in the aggregate based on an increase in our unsold VOI inventory.

Selling and marketing expenses for Bluegreen Resorts increased $21.1 million, or 9%, during 2007 as compared to 2006. As a percentage of sales, selling and marketing expenses decreased from 60% during 2006 to 58% during 2007. The increase in selling and marketing expenses during 2007 as compared to 2006 reflects the overall increase in sales prospects, higher marketing expenses at our newly opened off-site sales offices and a general increase in overall marketing expenses. As a percentage of sales, our selling and marketing costs decreased primarily as a result of the recognition of higher gains on sale (recorded as a component of revenue) in 2007 as compared to 2006, increased sales to existing owners, which generally carry lower marketing costs, as well as changes to our sales commission policy. We believe that selling and marketing expenses as a percentage of sales is an important indicator of the performance of Bluegreen Resorts and our performance as a whole. No assurance can be given that selling and marketing expenses will not increase as a percentage of sales in future periods.

Field general and administrative expenses for Bluegreen Resorts increased $1.7 million, or 6%, during 2007 as compared to 2006. As a percentage of sales, field general and administrative expenses decreased from 7% during 2006 to 6% in 2007.

As of December 31, 2007, approximately $24.6 million and $14.3 million of sales and field operating Profit, respectively, were deferred under SFAS No. 152 because such sales did not yet meet the minimum required initial investment. This compares to $27.3 million and $15.3 million of sales and field operating profits, respectively, deferred as of December 31, 2006.

Year ended December 31, 2006 compared to the year ended December 31, 2005

As previously discussed, the adoption of SFAS No. 152 on January 1, 2006 resulted in a material change to our accounting practices related to our timeshare operations. Accordingly, the operating results of Bluegreen Resorts for periods prior to 2006 are not comparable to those subsequent to the adoption of SFAS No. 152. For this reason, we will use the 2006 pro forma presentations below to discuss Bluegreen Resorts results of operations for the 2006 period as compared to 2005, as we believe that the 2006 pro forma results provide a better basis for comparison to 2005 than our United States generally accepted accounting principles results of operations under SFAS No. 152.


	Year Ended December 31, 2006										Year Ended December 31, 2005

						Pro Forma Excluding Impact of SFAS No. 152

	Amount			Percentage of Sales		Amount			Percentage of Sales		Amount			Percentage of Sales


Sales of real estate	$	399,105		100	%	$	413,929		100	%	$	358,240		100	%
Cost of real estate sales		(88,086	)	(22	)		(88,835	)	(21	)		(77,455	)	(22	)

Gross profit		311,019		78			325,094		79			280,785		78
Other resort operations revenue		51,688		13			60,762		15			64,276		18
Cost of other resort operations		(42,417	)	(10	)		(56,696	)	(14	)		(68,633	)	(19	)
Selling and marketing expenses		(239,788	)	(60	)		(237,331	)	(58	)		(195,407	)	(54	)
Field general and administrative expenses		(26,565	)	(7	)		(26,565	)	(6	)		(21,443	)	(6	)

Field operating profit	$	53,937		14	%	$	65,264		16	%	$	59,578		17	%

Bluegreen Resorts’ sales increased $40.9 million or 11% during 2006 as compared to 2005. Excluding the impact of SFAS No. 152, sales would have increased $55.7 million or 16% during 2006 as compared to 2005. The pro forma increase was due primarily to same-resort sales increases at many of our sales offices. Same-resort sales increased by approximately 12% during 2006 as compared to 2005 and were highlighted by increases in sales at The Fountains sales office in Orlando, Florida, our Bluegreen Wilderness Club at Big Cedar sales office in Ridgedale, Missouri, our Falls Village sales office in Branson, Missouri, and our MountainLoft sales office in Gatlinburg, Tennessee. The overall increase in sales was due in part to our continued focus on marketing to our growing Bluegreen Vacation Club owner base. Sales to owners increased by 46% and accounted for 34% of Bluegreen Resort sales during 2006 as compared to 28% during 2005. This, combined with an 8% overall increase in the number of sales prospects seen by Bluegreen Resorts from approximately 287,000 prospects during 2005 to approximately 310,000 prospects during 2006, and a relatively consistent, overall sale-to-tour conversion ratio of 13% during these periods, significantly contributed to the overall sales increase during 2006 as compared to 2005. Our sale-to-tour conversion ratio for new prospects (i.e., excluding sales to our existing owners) was 11% and 10% during 2005 and 2006, respectively. The increase in the number of prospects seen by Bluegreen Resorts and, consequently the increase in sales was partially due to our eight new sales sites opened in late 2005 and in 2006. Our new sales offices include an offsite sales office in Atlanta, Georgia (opened in November 2005), an offsite sales office in Chicago, Illinois (opened in February 2006), an offsite sales office in Las Vegas, Nevada (opened in July 2006), and sales offices located at two of our new resorts: Daytona SeaBreeze in Daytona Beach Shores, Florida (opened in December 2005), and Carolina Grande in Myrtle Beach, South Carolina (opened in March 2006). We also opened sales offices in Williamsburg, Virginia (opened in August 2006) and Wisconsin Dells, Wisconsin (opened in July 2006) on the grounds where we recently purchased properties for future resort locations. The increase in the average sales price per transaction, primarily due to a system-wide price increase of approximately 9% effective January 1, 2006 also contributed to the increase in sales.

Bluegreen Resorts’ gross margin percentages vary between periods based on the relative costs of the specific VOIs sold in each respective period. Excluding the adoption of SFAS No. 152, our gross margin would have increased from 78% during 2005 to 79% during 2006, primarily as a result of the previously discussed price increase.

Other resort operations revenues decreased $12.6 million or 20% during 2006 as compared to 2005. Excluding the impact of SFAS No. 152, other resort operations revenue would have decreased $3.5 million or 5% during 2006 as compared to 2005. The adoption of SFAS No. 152 had the impact of decreasing other resort operations revenue due to the reclassification of rental proceeds from other resort operations revenue to net against cost of other resort operations, partially offset by the classification of revenue for sales incentives for VOI sales to other resort operations revenue. The 2006 results also represent lower sales of mini-vacation packages on behalf of third parties. During 2006, we transitioned our mini-vacation package business from primarily selling the packages to third-parties to using the sales

tours generated by mini-vacations primarily for use at our own sales offices. This transition was substantially completed in the second half of 2006. As a result, this has had the effect of increasing the profitability of our other resort operations (reducing costs in excess of revenues) but increasing our selling and marketing costs. These decreases were partially offset by increases in fees earned by our wholly-owned title company as well as higher resort management fees earned by our resort management company. Resort management fees increased in the aggregate due to an increase in the number of resorts for which we provide management services.

Cost of other resort operations decreased $26.2 million, or 38%, during 2006 as compared to 2005. Excluding the impact of SFAS No. 152, cost of other resort operations would have decreased $11.9 million or 17% during 2006 as compared to 2005. The adoption of SFAS No. 152 had the impact of decreasing cost of other resort operations due primarily to the reclassification of rental proceeds from other resort operations revenue and the reclassification of the net proceeds of the Sampler Program from selling and marketing expenses to a reduction to cost of other resort operations. The decrease also reflects a significant reduction in the amount of cost related to mini-vacations sold on behalf of third parties, as previously discussed, partially offset by higher subsidies incurred on our VOI inventory relative to the property owners’ associations that maintain our resorts. These subsidies increased in the aggregate based on an increase in our unsold VOI inventory.

Selling and marketing expenses for Bluegreen Resorts increased $44.4 million or 23% during 2006 as compared to 2005. As a percentage of sales, selling and marketing expenses increased from 55% during 2005 to 60% during 2006. The adoption of SFAS No. 152 had the impact of increasing selling and marketing expenses as a percentage of sales as a result of the immediate recognition of marketing expenses associated with certain VOI sales that have not yet been recognized, and due to the reclassification of the net profits of the Sampler Program from selling and marketing expenses to a reduction of cost of other resort operations. The increase in selling and marketing expense during 2006, as compared to 2005, also reflects a general increase in overall marketing expenses due primarily to start-up costs related to new marketing alliances, higher marketing expenses as a percentage of sales at our newly opened off-site sales offices and the previously discussed transition of our mini-vacations packages from being sold externally to being used internally. These increases were partially offset by the favorable impact on selling and marketing cost of the increase in sales to existing owners during 2006 as compared to 2005. Excluding the impact of SFAS No. 152, selling and marketing expense would have increased $41.9 million or 21% during 2006 as compared to 2005. As a percentage of sales, on a pro forma basis, selling and marketing expenses increased from 55% during 2005 to 57% during 2006.

Field general and administrative expenses for Bluegreen Resorts increased $5.1 million or 24% during 2006 as compared to 2005. The increase in field general and administrative expenses was primarily a result of the cost of opening and operating our new sales offices. Additionally, the increase in 2006 also reflects costs to close an off-site sales office located in King of Prussia, Pennsylvania.

Bluegreen Communities. During 2005, 2006, and 2007, Bluegreen Communities generated $192.1 million (35%), $164.0 million (29%), and $129.2 million (22%), of our total consolidated sales of real estate, respectively.

The table below sets forth the number of homesites sold by Bluegreen Communities and the average sales price per homesite for the periods indicated, before giving effect to the percentage-of-completion method of accounting, sales in certain properties that had not completed the platting process, and excluding sales of bulk parcels.


	Year ended

	December 31, 2005			December 31, 2006			December 31, 2007

Number of homesites sold			2,287			1,750			1,301
Average sales price per homesite		$	80,188		$	81,478		$	83,548

Bluegreen Communities’ sales decreased $34.8 million, or 21%, during 2007 as compared to 2006 largely reflecting several of the Company’s more mature developments either approaching sell out or sold out during or prior to 2007, partially offset by the recognition of sales generated at Sanctuary River Club which commenced sales in 2007 and the recognition of $8.4 million of sales made in 2006 at properties which had not completed the platting process until 2007. In addition to the impact of reduced inventory levels, we believe that Bluegreen Communities’ sales in certain regions have been and continue to be negatively impacted by a generally slower residential real estate market. We anticipate that future land purchases will only be consummated on a selective basis with a view towards aligning our Bluegreen Communities inventory with current and anticipated lower market demand. Before giving effect to the percentage-of-completion method of accounting, during 2007 we entered into contracts to sell homesites totaling $118.9 million, as compared to $158.1 million during 2006. Sales in 2007 consisted of real estate sold at the following properties:


	Properties Sold in Projects Not Substantially Sold Out at December 31, 2007 (in 000’s)

Project	2006			2007		Difference


Chapel Ridge		$	23,894	$	15,275		$	(8,619	)
Sanctuary Cove at St. Andrews Sound			7,400		2,416			(4,984	)
Mystic Shores			36,819		33,083			(3,736	)
Havenwood at Hunter’s Crossing			13,166		17,352			4,186
Lake Ridge at Joe Pool Lake			12,919		7,795			(5,124	)
Vintage Oaks at the Vineyard			6,764		15,533			8,769
The Bridges at Preston Crossings			4,487		5,189			702
Sugar Tree on the Brazos			1,351		2,054			703
Saddle Creek Forest			6,454		4,927			(1,527	)
King Oaks			724		5,501			4,777

Total		$	113,978	$	109,125		$	(4,853	)


	Properties Sold in Projects Substantially Sold Out at December 31, 2007 (in 000’s)

Project	2006			2007		Difference


Fairway Crossings			709		98			(611	)
Mountain Springs Ranch			16,488		—			(16,488	)
Big Country			7,000		—			(7,000	)
Traditions of Braselton			2,797		—			(2,797	)
Catawba Falls Preserve			6,418		35			(6,383	)
Brickshire			2,074		2,645			571
Yellow Stone Creek Ranch			1,265		—			(1,265	)
The Settlement at Patriot Ranch			6,468		3,612			(2,856	)
Miscellaneous			909		311			(598	)

Total		$	44,128	$	6,701		$	(37,427	)

Bluegreen Communities’ sales were increased by $12.1 million during 2006 and $5.4 million during 2007 as a result of the application of the percentage-of-completion method of accounting.

Bluegreen Communities’ sales decreased $28.1 million or 15% during 2006 as compared to 2005 as a result of several of the Company’s more mature developments either approaching sell out or selling out during 2006, as well as the impact of certain revenue recognition policies described below, partially offset by sales generated at new Bluegreen Communities that commenced sales in 2006. Before giving effect to the percentage-of-completion method of accounting, during 2006 we entered into contracts to sell homesites totaling $158.1 million, as compared to $200.4 million during 2005. These sales consisted of real estate sold at the following projects:


	Properties Sold in Projects Not Substantially Sold Out at December 31, 2006 (in 000’s)

Project	2005			2006		Difference


Chapel Ridge		$	27,492	$	23,894		$	(3,598	)
Sanctuary Cove at St. Andrews Sound			55,798		7,400			(48,398	)
Mystic Shores			26,639		36,819			10,180
Havenwood at Hunter’s Crossing			—		13,166			13,166
Lake Ridge at Joe Pool Lake			12,688		12,919			231
Vintage Oaks at the Vineyard			—		6,764			6,764
The Bridges at Preston Crossings			—		4,487			4,487
Sugar Tree on the Brazos			6,229		1,351			(4,878	)
Saddle Creek Forest			10,207		6,454			(3,753	)
The Settlement at Patriot Ranch			2,749		6,468			3,719
King Oaks			—		724			724

Total		$	141,802	$	120,446		$	(21,356	)


	Properties Sold in Projects Substantially Sold Out at December 31, 2006 (in 000’s)

Project	2005			2006		Difference


Silver Lakes Ranch			4,216		185			(4,031	)
Mountain Springs Ranch			13,585		16,488			2,903
Big Country			—		7,000			7,000
Traditions of Braselton			22,490		2,797			(19,693	)
Catawba Falls Preserve			4,271		6,418			2,147
Brickshire			3,873		2,075			(1,798	)
Yellow Stone Creek Ranch			1,061		1,265			204
Mountain Lakes Ranch			5,534		—			(5,534	)
Miscellaneous			3,582		1,476			(2,106	)

Total		$	58,612	$	37,704		$	(20,908	)

Bluegreen Communities’ sales were reduced by $3.4 million during 2005 and were increased by $12.1 million during 2006 as a result of the application of the percentage-of-completion method of accounting. Additionally, because the platting process for certain properties sold near the end of 2006 was not completed before the end of 2006 we were unable to recognize approximately $8.4 million of sales in 2006, which were subsequently recognized in 2007.

Bluegreen Communities’ gross margin increased from 45% in 2006 to 48% in 2007. Bluegreen Communities’ gross margin decreased from 48% in 2005 to 45% in 2006. Variations in cost structures and the market pricing of projects available for sale as well as the opening of phases of projects, which include premium homesites (e.g., water frontage, preferred views, larger acreage homesites, etc.) impact the gross margin of Bluegreen Communities from period to period. These factors, as well as the impact of percentage-of-completion accounting, will cause variations in gross margin between periods, although the gross margin of Bluegreen Communities has historically been between 45% and 55% of sales. In addition, during 2006, our gross margin was negatively impacted by the bulk sale of property near San Diego, California, which had a relatively low margin, as well as the recognition of a charge of approximately $3.0 million to repair a lake amenity at a nearly sold-out community.

Other communities operations include the operation of our daily fee golf courses, as well as realty resale operations at several of our residential land communities. Other communities’ operations revenues increased $1.9 million, or 16%, from $11.9 million to $13.8 million and the related costs increased $2.6 million, or 24%, from $10.8 million to $13.4 million during 2006 and 2007, respectively. These increases were primarily due to the $3.1 million sale of the real estate and operations of our Traditions of Braselton golf course (at a profit of approximately $740,000), partially offset by lower golf course revenues and lower fees earned from our realty resale operations. During 2006, other communities’ operations revenues increased $2.4 million, or 25%, to $11.9 million from $9.5 million in 2005 and the related costs increased $2.1 million or 24% to $10.8 million from $8.7 million in 2005, respectively. These increases were primarily

due to the opening of daily-fee golf courses located at our Chapel Ridge and Sanctuary Cove at St. Andrew’s Sound communities.

Certain of our golf course operations periodically incur losses during periods of low level of play, especially during the winter months, and as a result of fixed operating expenses and high maintenance costs. Also, certain of our golf courses are still in their early years of operations during the periods presented. We believe that the operating results of these new courses should improve as individuals who have purchased homesites in the communities in which these courses are located build their homes and begin living in the community, as this should increase the amount of play on our golf courses. However, there is no assurance that such improvement in operating results will be achieved.

Total selling and marketing expenses for Bluegreen Communities remained relatively constant in 2006 and 2007. However, as a percentage of sales, selling and marketing expenses increased from 17% during 2006 to 22% during 2007. The increase in selling and marketing costs as a percentage of sales in 2007 reflects higher 2007 advertising expenses, primarily as a result of the shift to internet-based marketing, costs incurred prior to the periods when prospects generated are expected to tour our communities, as well as a larger number of bulk sale transactions in 2006, which generally carry a lower commission expense than sales made on a retail basis. Higher advertising expenses were partially off-set by lower commission commensurate with the sales decrease.

Selling and marketing expenses for Bluegreen Communities decreased from $33.6 million in 2005 to $27.6 million in 2006. As a percentage of sales, selling and marketing expenses remained constant at 17% during 2005 and 2006. The decrease in total selling and marketing costs in 2006 reflected lower commissions commensurate with the sales decrease and as a result of 2006 bulk sales which typically carry a lower commission percentage. This decrease was partially offset by higher advertising expenses, which were the result of start up advertising associated with our new developments.

Bluegreen Communities’ general and administrative expenses remained constant at $10.8 million during 2006 and 2007. As a percentage of sales, general and administrative expenses increased from 7% in 2006 to 8% in 2007, reflecting the overall decrease in sales.

Bluegreen Communities’ general and administrative expenses decreased from $11.8 million during 2005 to $10.8 million during 2006. This decrease in general and administrative expenses in 2006 was due to the closure of five sales offices in the second half of 2005. The offices at Silver Lakes Ranch, Mountain Lakes Ranch, Quail Springs Ranch, Brickshire, and the Traditions of Braselton were closed as a result of the substantial sell out at these locations. As a percentage of sales, general and administrative expenses increased from 6% in 2005 to 7% in 2006, reflecting the overall decrease in sales.

As of December 31, 2006, Bluegreen Communities had $18.6 million of sales and $7.7 million of Field Operating Profit deferred under percentage-of-completion accounting. As of December 31, 2007, Bluegreen Communities had $13.2 million of sales and $5.5 million of Field Operating Profit deferred under percentage-of-completion accounting.

Corporate General and Administrative Expenses. Our corporate general and administrative expenses consist primarily of expenses associated with administering the various support functions at our corporate headquarters, including accounting, human resources, information technology, resorts’ acquisition and development, mortgage servicing, treasury and legal. Such expenses were $38.0 million, $52.2 million and $49.6 million for 2005, 2006, and 2007, respectively.

The $2.6 million, or 5%, decrease in corporate general and administrative expenses during 2007 as compared to 2006 was primarily due to:


	•	the 2006 recognition of a charge totaling $2.6 million related to a separation agreement with our former Chief Executive Officer (described below);

	•	a 2006 recognition of a $1.1 million write-off related to the abandonment of a software development project;

	•	the recognition of expenses during 2006 totaling approximately $2.1 million associated with the adoption of our shareholders’ rights plan and related litigation; and

	•	Higher fees earned by our mortgage servicing. As previously discussed, we earn fees for servicing the notes receivable that we have sold in term securitization transactions and through our vacation ownership receivables purchase facilities.

These factors were partially offset by higher 2007 costs associated with information technology spending, primarily as a result of the implementation of new computer systems to support our resort sales organization.

The $14.2 million, or 37%, increase in corporate general and administrative expenses during 2006 as compared to 2005 was primarily due to:


	•	the recognition of stock compensation expense of $2.9 million as a result of adopting the provisions of SFAS No. 123R (revised 2004), Share-Based Payment , (“SFAS No. 123R”), including $600,000 related to the modification of existing stock options of our former Chief Executive Officer who retired at the end of 2006 and charges totaling $2.6 million related to the total compensation payable under a separation agreement with our former Chief Executive Officer;

	•	the recognition of expenses totaling approximately $2.1 million associated with the adoption of our shareholders’ rights plan and related litigation;

	•	the 2006 recognition of a $1.1 million write-off related to the abandonment of a software development project; and,

	•	an overall increase in corporate headcount to support our growth at Bluegreen Resorts.

These increases were partially off-set by higher profits from our mortgage servicing operations in 2006 as compared to 2005.

For a discussion of field selling, general and administrative expenses, see “Sales and Field Operations,” above.

Interest Income. Interest income is earned from our notes receivable, retained interests in notes receivable sold and cash and cash equivalents. Interest income was $34.8 million, $40.8 million, and $44.7 million for 2005, 2006, and 2007, respectively. The increase in interest income during 2007 as compared to 2006 was due primarily to higher interest accretion on our retained interest in notes receivable sold (as a result of higher average retained interests in 2007 due to the sale of additional VOI notes receivable) and higher average vacation ownership notes receivable balances during 2007 as compared to 2006. This increase was partially off-set by the recognition of other-than-temporary decreases totaling approximately $2.4 million in 2007 in the fair value of certain of our retained interests in VOI notes receivable. The overall decrease in the value of our retained interest in VOI notes receivable in 2007 an increase in the discount rates applied to estimated future cash flows on our retained interests as a result of the overall increase in return required by investors in our securitization transactions due to the deteriorating credit market in the second half of 2007. There can be no assurance that additional charges will not be required due to other-than-temporary decreases in the fair value of our retained interest in VOI notes receivables.

The increase in interest income during 2006 as compared to 2005 was due primarily to higher interest accretion on our retained interests in notes receivable sold (as a result of higher average retained interests in 2006 due to the sale of additional notes receivable) and higher average VOI notes receivable balances during 2006 as compared to 2005.

Gain on Sales of Notes Receivable. We recognized total gains on the sale of notes receivable totaling $25.2 million, $44.7 million, and $39.4 million during 2005, 2006, and 2007, respectively. As required under SFAS No. 152, approximately $38.8 million and $42.8 million of the gain in 2006 and 2007, respectively, was reflected as an increase to VOI sales. During 2005, 2006, and 2007, we sold $228.6 million, $243.6 million, and $266.9 million of notes receivable. The decrease in gain recognized in 2007 as compared to 2006 was a result of a lower advance rate and higher interest costs in the 2007 term securitization compared to the 2006 transactions. The gain on sale of notes receivable in 2005 was calculated on a different basis, prior to the adoption of SFAS No. 152, and is therefore not comparable to the other periods presented.

The amount of notes receivable sold during a period depends on several factors, including the state of the market generally, the amount of availability, if any, under receivables purchase facilities, the amount of eligible receivables available for sale, our cash requirements, the covenants and other provisions of the relevant VOI receivables purchase facility (as described further below) and management’s discretion. The generally accepted accounting principles governing our sale of receivable transactions are evolving and achieving off-balance sheet accounting treatment is becoming more difficult. Due to the complexity of the accounting rules surrounding such transactions, we have decided to limit the use of off-balance sheet structures. In 2006, we structured a VOI receivables purchase facility that is used to accumulate receivables pending a term securitization transaction in a manner so as to account for sales of receivables under such facilities as on-balance sheet borrowings pursuant to SFAS No. 140. No gains are recognized on the sales of receivables to this facility until the receivables are included in an appropriately structured term securitization transaction. We expect to continue this accounting treatment for similarly structured facilities for the foreseeable future. As a result, we expect that the volatility of our quarterly earnings will increase prospectively, but we do not anticipate that this will materially impact annual earnings, as long as the facilities and term securitizations continue to be available to us. However, as evidenced by the recent disruptions in the credit markets associated with the

deterioration in the subprime lending markets and other liquidity issues, there is no assurance that we will continue to have access to the facilities or securitizations on favorable terms or at all.

Interest Expense. Interest expense was $14.5 million, $18.8 million, and $24.3 million for 2005, 2006, and 2007, respectively. The increase in interest expense during 2007 was primarily a result of higher average debt outstanding partially offset by an increase in the amount of interest capitalized in connection with current development activity as compared to 2006. Average debt outstanding during 2007 increased in part as a result of the February issuance of $20.6 million of junior subordinated debentures and increased borrowings on operating lines of credit during the second half of 2007 in order to increase our cash on hand. The 30% increase in interest expense for 2006 as compared 2005 was primarily a result of higher average debt outstanding and higher interest rates in 2006 partially offset by increased capitalized interest on current development activity. Average debt outstanding in 2006 increased in part as a result of our on-balance sheet treatment of transfers to the BB&T Purchase Facility (as discussed further under “Credit Facilities for Bluegreen Resorts Receivables and Inventories”) and due to increased borrowings in connection with inventory acquisition and development activities.

Total interest expense capitalized to construction in progress was $10.0 million, $12.1 million and $15.5 million for 2005, 2006, and 2007, respectively.

Our effective cost of borrowing was 8.9%, 10.5%, and 9.4% for 2005, 2006, and 2007, respectively.

Provision for Loan Losses. We recorded provisions for loan losses totaling $27.6 million, $59.5 million and $65.2 million during 2005, 2006, and 2007, respectively. Effective January 1, 2006, SFAS No. 152 requires that the estimated losses on originated VOI mortgages exclude the benefit of an estimate for the value of future recoveries and further requires that the provision for loan losses for VOI receivables be reflected as a reduction of VOI sales (see VOI sales above). Accordingly, the provisions for loan losses recorded during 2005 are not comparable to that recorded during 2006 and 2007.

We determine the adequacy of our reserve for loan losses and review it on a regular basis considering, among other factors, historical frequency of default, loss experience, static pool analyses, estimated value of the underlying collateral (communities notes receivable, only), present and expected economic conditions, as well as other factors. Effective January 1, 2006, we changed our accounting for loan losses on our VOI notes receivable in accordance with SFAS No. 152. Under SFAS No. 152, we estimate uncollectibles based on historic uncollectibles for similar VOI notes receivable.

The following table summarizes our allowance for loan losses by division as of December 31, 2006 and 2007:


	Bluegreen Resorts				Bluegreen Communities				Other			Total


December 31, 2006:
Notes receivable		$	150,649			$	6,915		$	186		$	157,750
Allowance for loan losses			(13,140	)			(173	)		(186	)		(13,499	)

Notes receivable, net		$	137,509			$	6,742		$	—		$	144,251

Allowance as a % of gross notes receivable			9	%			3	%		100	%		9	%


December 31, 2007:
Notes receivable		$	172,787			$	5,336		$	—		$	178,123
Allowance for loan losses			(17,196	)			(262	)		—			(17,458	)

Notes receivable, net		$	155,591			$	5,074		$	—		$	160,665

Allowance as a % of gross notes receivable			10	%			5	%		0	%		10	%

Minority Interest in Income of Consolidated Subsidiary. We include the results of operations and financial position of Bluegreen/Big Cedar Vacations, LLC (the “Subsidiary”), our 51%-owned subsidiary, in our consolidated financial statements (See Note 1 of the Notes to Consolidated Financial Statements for further information). The minority interest in income of consolidated subsidiary is the portion of our consolidated pre-tax income that is attributable to Big Cedar, LLC, the unaffiliated 49% interest holder in the Subsidiary. Minority interest in income of consolidated subsidiary was $4.8 million, $7.3 million, and $7.7 million for 2005, 2006, and 2007, respectively. Pre-tax income for the subsidiary has increased over the periods presented as sales at the Bluegreen Wilderness Club at Big Cedar have increased.

Provision for Income Taxes. Our effective income tax rate was approximately 38.5%, 37.8% and 38.0% for 2005, 2006 and 2007, respectively. Our annual effective income tax rate varies as our mix of taxable earnings shifts among the various states in which we operate. Additionally, in March 2007, we received notice from the IRS that our 2004 and 2005 federal income tax returns had been selected for examination. On October 12, 2007, we received an examination report from the IRS for the 2004 and 2005 tax periods asserting, in the aggregate, approximately $35,000 of additional tax due, plus accrued interest. Also, as discussed in Note 17 to our condensed consolidated financial statements, in July 2007 the State of Michigan enacted a tax change effective January 1, 2008. Based on our current operations, we do not expect that this change will materially impact our effective tax rate. As we expand our operations into areas where we currently do not conduct a significant amount of business or if our mix of income or currently enacted tax rates change, there can be no assurance that our effective income tax rate will be comparable to our historical rates.

Cumulative Effect of Change in Accounting Principle from the Adoption of SFAS No. 152 . The adoption of SFAS No. 152 on January 1, 2006 resulted in a net charge of $4.5 million, which is presented as a cumulative effect of change in accounting principle. The cumulative effect of change in accounting principle primarily consists of the deferral of VOI sales and related costs for sales that were previously recognized but did not meet the required down payment threshold at January 1, 2006, due to sales incentives provided to buyers and the treatment of our Sampler Program, and the related tax benefit, net of the cumulative effect of change in accounting principle charge, related to the minority interest in the Subsidiary.

Summary. Based on the factors discussed above, our net income was $46.6 million, $29.8 million, and $31.9 million for 2005, 2006, and 2007, respectively.

Changes in Financial Condition

The following table summarizes our cash flows for 2005, 2006, and 2007 (in thousands):


	Year Ended

	December 31, 2005				December 31, 2006				December 31, 2007


Cash flows provided (used) by operating activities		$	95,525			$	8,426			$	(21,121	)
Cash flows (used) provided by investing activities			(8,141	)			4,461				19,477
Cash flows (used) provided by financing activities			(103,245	)			(26,443	)			75,469

Net increase (decrease) in cash and cash equivalents		$	(15,861	)		$	(13,556	)		$	73,825

Cash Flows From Operating Activities. Cash flows from operating activities decreased $29.5 million from net cash inflows of $8.4 million to an outflow of $21.1 million during 2006 and 2007, respectively. The decrease in cash flows provided by operating activities during 2007 compared to 2006 was primarily driven by higher resort development spending at our Williamsburg, Las Vegas, and Odyssey Dells projects and an increase in notes receivable due to increased VOI sales. This decrease was partially offset by higher proceeds from the sale of notes receivable during 2007, as compared to 2006.

Cash flows from operating activities decreased $87.1 million or 91% from net cash inflows of $95.5 million to $8.4 million during 2005 and 2006, respectively. The decrease in cash flows provided by operating activities during 2006 compared to 2005 was primarily driven by higher inventory acquisition and development spending and an increase in notes receivable due to increased VOI sales. During 2006 we acquired land for four Bluegreen Communities (The Bridges at Preston Crossings, King Oaks, Vintage Oaks at the Vineyard) as well as four parcels of land for Bluegreen Resorts (located in Newland, North Carolina; Williamsburg, Virginia; Las Vegas, Nevada; and Wisconsin Dells, Wisconsin). Partially offsetting the decrease in cash flows from operations were higher proceeds from the sale of notes receivable during 2006, as compared to 2005.

Cash Flows From Investing Activities. Cash flows from investing activities increased $15.0 million from net cash inflows of $4.5 million to $19.5 million for 2006 and 2007, respectively. This increase was due primarily to higher amounts of cash received in 2007 from our retained interests in notes receivable sold and lower expenditures in 2007 for property and equipment as compared to 2006.

Cash flows from investing activities increased $12.6 million or 155% from net cash outflows of $8.1 million to net inflows of $4.5 million for 2005 and 2006, respectively. This increase was due primarily to higher amounts of cash received in 2006 from our retained interests in notes receivable sold. This increase was partially offset by higher expenditures in 2006 for property and equipment as compared to 2005.

Cash Flows From Financing Activities. Cash flows from financing activities increased $101.9 million from net cash outflows of $26.4 million to inflows of $75.5 million during 2006 and 2007, respectively. We borrowed $147.8 million in 2007 under our lines-of-credit compared to $56.7 million in 2006, and incurred higher net borrowings under our collateralized notes receivable facilities in 2007 as compared to 2006. These cash flows were partially offset by the receipt of $30.9 million of proceeds in connection with our issuance of the junior subordinated debentures in 2006, as compared to the receipt of only $20.6 million of such proceeds during 2007.

Cash flows from financing activities increased $76.8 million or 74% from net cash outflows of $103.2 million to $26.4 million during 2005 and 2006, respectively. In 2005, we redeemed $55.0 million of our 10.5% Senior Secured Notes. Additionally, we borrowed $56.7 million in 2006 under our lines-of-credit compared to $26.4 million in 2005, and incurred higher net repayments under our collateralized notes receivable facilities in 2005 as compared to 2006. These cash flows were partially offset by the receipt of $59.3 million of proceeds in connection with our issuance of the junior subordinated debentures in 2005, as compared to the receipt of only $30.9 million of such proceeds during 2006.

Liquidity and Capital Resources

Our capital resources are provided from both internal and external sources. Our primary capital resources from internal operations are: (i) cash sales, (ii) down payments on homesite and VOI sales which are financed, (iii) proceeds from the sale of, or borrowings collateralized by, notes receivable, including cash received from our retained interests in notes receivable sold, (iv) principal and interest payments received on the purchase money mortgage loans arising from sales of VOIs and homesites and (v) net cash generated from other resort services and other communities operations. Historically, external sources of liquidity have included non-recourse sales of notes receivable, borrowings under secured and unsecured lines-of-credit, seller and bank financing of inventory acquisitions and the issuance of debt securities. Our capital resources are used to support our operations, including (i) acquiring and developing inventory, (ii) providing financing for customer purchases, (iii) funding operating expenses and (iv) satisfying our debt and other obligations. As we are continually selling and marketing real estate (VOIs and homesites), it is necessary for us to acquire and develop new resorts and communities in order to maintain adequate levels of inventory to support operations. We anticipate that we will continue to require external sources of liquidity to support our operations, satisfy our debt and other obligations and to provide funds for growth.

Our levels of debt and debt service requirements have several important effects on our operations, including the following: (i) we have significant cash requirements to service debt, reducing funds available for operations and future business opportunities and increasing our vulnerability to adverse economic and industry conditions, as well as conditions in the credit markets, generally; (ii) our leverage position increases our vulnerability to economic and competitive pressures; (iii) the financial covenants and other restrictions contained in the indentures, the credit agreements and other agreements relating to our indebtedness require us to meet certain financial tests and restrict our ability to, among other things, borrow additional funds, dispose of assets, make investments or pay cash dividends on or repurchase preferred or common stock; and (iv) our leverage position may limit funds available for working capital, capital expenditures, acquisitions and general corporate purposes. Certain of our competitors operate on a less leveraged basis and have greater operating and financial flexibility than we do.

Subject to the continued availability of financing and liquidity, we currently intend to continue to pursue a growth-oriented strategy, particularly with respect to our Bluegreen Resorts business segment. In connection with this strategy, we may from time to time acquire, among other things, additional resort properties and completed but unsold VOIs; land upon which additional resorts may be built; management contracts; loan portfolios of vacation ownership mortgages; portfolios which include properties or assets which may be integrated into our operations; interests in joint ventures; and operating companies providing or possessing management, sales, marketing, development, administration and/or other expertise with respect to our operations in the vacation ownership industry. In addition, we have focused Bluegreen Communities’ activities on larger, more capital intensive projects particularly in those regions where we believe the market for our products is strongest.

In February 2008, we announced that we intend to pursue a rights offering to our shareholders of up to $100 million of our common stock. We intend to file a registration statement relating to the rights offering in March. While Bluegreen had $125.5 million of unrestricted cash and cash equivalents at December 31, 2007, the purpose of the rights offering is to further strengthen our balance sheet in light of our $55 million of senior secured notes maturing in April 2008 and to support growth, including growth through acquisitions. We intend to pursue available opportunities and evaluate our business plan for Bluegreen Communities, with the long-term goal being to best position our company to take advantage of strategic alternatives so as to maximize shareholder value in the future.

The following is a discussion of our purchase and credit facilities that were important sources of our liquidity as of December 31, 2007. These facilities do not constitute all of our outstanding indebtedness as of December 31, 2007. Our

other indebtedness includes outstanding senior secured notes payable, junior subordinated debentures, borrowings collateralized by real estate inventories that were not incurred pursuant to an ongoing credit facility and capital leases.

Vacation Ownership Receivables Purchase Facilities – Off-Balance Sheet Arrangements

Our ability to sell and/or borrow against our notes receivable from VOI buyers is a critical factor in our continued liquidity. When we sell VOIs, a financed buyer is only required to pay a minimum of 10% of the purchase in cash at the time of sale; however, selling, marketing and administrative expenses are primarily cash expenses and, in our case for the year ended December 31, 2007, approximated 64% of sales. Accordingly, having facilities available for the hypothecation or sale of these vacation ownership receivables is a critical factor to our ability to meet our short and long-term cash needs.

We have historically chosen to monetize our receivables through various facilities and through periodic term securitization transactions, as these off-balance sheet arrangements provide us with cash inflows both currently and in the future at what we believe to be competitive rates without adding leverage to our balance sheet or retaining recourse for losses on the receivables sold. In addition, these sale transactions have typically generated gains on our income statement on a periodic basis, which would not be realized under a traditional financing arrangement. There is no assurance that these arrangements will be available in the future.

Historically, we have been a party to a number of securitization-type transactions, all of which in our opinion utilize customary structures and terms for transactions of this type. In each securitization-type transaction, we sold receivables to a wholly-owned special purpose entity which, in turn, sold the receivables either directly to third parties or to a trust established for the transaction. In each transaction, the receivables were sold on a non-recourse basis (except for breaches of certain representations and warranties) and the special purpose entity has a retained interest in the receivables sold. We have acted as servicer of the receivables pools in each transaction for a fee, with the servicing obligations specified under the applicable transaction documents. Under the terms of the applicable transaction documents, the cash payments received from obligors on the receivables sold are distributed to the investors (which, depending on the transaction, may acquire the receivables directly or purchase an interest in, or make loans secured by the receivables to, a trust that owns the receivables), parties providing services in connection with the facility, and our special purpose subsidiary as the holder of the retained interest in the receivables according to specified formulas. In general, available funds are applied monthly to pay fees to service providers, make interest and principal payments to investors, fund required reserves, if any, and pay distributions in respect of the retained interests in the receivables. Pursuant to the terms of the transaction documents; however, to the extent the portfolio of receivables fails to satisfy specified performance criteria (as may occur due to an increase in default rates or loan loss severity) or other trigger events, the funds received from obligors are distributed on an accelerated basis to investors. In effect, during a period in which the accelerated payment formula is applicable, funds go to outside investors until they receive the full amount owed to them and only then are payments made to our subsidiary in its capacity as the holder of the retained interests. Depending on the circumstances and the transaction, the application of the accelerated payment formula may be permanent or temporary until the trigger event is cured. If the accelerated payment formula were to become applicable, the cash flow on the retained interests in the receivables would be reduced until the outside investors were paid or the regular payment formula was resumed. Such a reduction in cash flow could cause a decline in the fair value of our retained interests in the receivables sold. Declines in fair value that are determined to be other than temporary are charged to operations in the current period. In each facility, the failure of the pool of receivables to comply with specified portfolio covenants can create a trigger event, which results in the use of the accelerated payment formula (in certain circumstances until the trigger event is cured and in other circumstances permanently) and, to the extent there was any remaining commitment to purchase receivables from our special purpose subsidiary, the suspension or termination of that commitment. In addition, in each securitization-type facility certain breaches of our obligations as servicer or other events allow the indenture trustee to cause the servicing to be transferred to a substitute third party servicer. In that case, our obligation to service the receivables would terminate and we would cease to receive a servicing fee.

2007 Term Securitization . In September 2007, BB&T Capital Markets, a division of Scott & Stringfellow, Inc., served as initial purchaser and placement agent for a private offering and sale of $177.0 million of vacation ownership receivable -backed securities (the “2007 Term Securitization”). Approximately $200.0 million in aggregate principal of vacation ownership receivables were securitized and sold in this transaction, including: (1) $115.5 million in aggregate principal of vacation ownership receivables that were previously transferred under the 2006 BB&T Purchase Facility; (2) $35.8 million of vacation ownership receivables owned by the Company immediately prior to the 2007 Term Securitization; and, (3) an additional $48.7 million in aggregate principal of the Company’s qualifying vacation ownership receivables that were sold by us in the fourth quarter of 2007. During 2007, we sold $48.7 million in Pre-funded Receivables and the $43.1 million purchase price was disbursed to us from the escrow account.

The following is a summary of significant financial information related to our off-balance sheet facilities and securitizations during the periods presented below (in thousands):

As of
December 31,
2006

As of
December 31,
2007

On-Balance Sheet:

Retained interests in notes receivable sold

130,623

141,499

Off-Balance Sheet:

Notes receivable sold without recourse

540,536

644,735

Principal balance owed to note receivable purchasers

503,854

597,970


				Year Ended

	December 31, 2005			December 31, 2006			December 31, 2007

Income Statement:

Gain on sales of notes receivable (1)		$	25,226		$	44,700		$	39,372
Interest accretion on retained interests in notes receivable sold			9,310			14,569			15,157
Servicing fee income			4,969			6,955			8,698

(1) Includes amounts classified as VOI sales, pursuant to SFAS No. 152.

Credit Facilities for Bluegreen’s Receivables and Inventories

In addition to the VOI receivables purchase facilities discussed above, we maintain various credit facilities with financial institutions that provide receivable, acquisition and development financing for our operations. We had the following credit facilities, as of December 31, 2007 (see further discussion below):


Credit Facility	Outstanding Borrowings as of December 31, 2007	Availability as of December 31, 2007			Advance Period Expiration; Borrowing Maturity	Borrowing Limit			Borrowing Rate	Interest Rate as of December, 31, 2007

The GMAC Receivables Facility	$ 11.4 million	$	63.6	million	February 15, 2008; February 15, 2015	$	75.0	million	30-day LIBOR + 4.00%	8.60	%

The GMAC AD&C Facility	$ 81.7 million	$	68.3	million	February 15, 2008 ⁽¹⁾ ; August 15, 2013	$	150.0	million	30-day LIBOR + 4.50%	9.10	%

2006 BB&T Purchase Facility	$ 17.0 million	$	120.5	million	May 25, 2008; March 5, 2019	$	137.5	million	30-day LIBOR + 1.25%	5.85	%

The GMAC Communities Facility	$ 66.4 million	$	8.6	million	Expired ⁽²⁾ ; September 30, 2009	$	75.0	million	Prime + 1.00%	8.25	%

The GE Bluegreen/Big Cedar Facility	$ 24.1 million	$	20.9	million	April 16, 2009; April 16, 2016	$	45.0	million	30-day LIBOR + 1.75%	6.35	%


	(1)	Reflects last date that additional projects can be added to the facility. Borrowings on the specific projects added to the facility prior to this date can be made after this date subject to the terms and conditions of each individual project commitment. See further discussion, below.

	(2)	Borrowings on the specific projects added to the facility prior to expiration can made after expiration subject to the terms and conditions of each individual project commitments. See further discussion below.

Credit Facilities for Bluegreen Resorts’ Receivables and Inventories

The GMAC Receivables Facility . In February 2003, we entered into a revolving VOI receivables credit facility (the “GMAC Receivables Facility”) with Residential Funding Corporation (“RFC”), an affiliate of GMAC. The GMAC Receivables Facility has detailed requirements with respect to the eligibility of receivables for inclusion and other conditions to funding. The borrowing base under the GMAC Receivables Facility is 90% of the outstanding principal balance of eligible notes arising from the sale of VOIs. The GMAC Receivables Facility includes affirmative, negative and financial covenants and events of default. All principal and interest payments received on pledged receivables are applied to principal and interest due under the GMAC Receivables Facility. Interest payments are due monthly. During the year ended December 31, 2007, we did not pledge any VOI receivables under the GMAC Receivables Facility.

The GMAC AD&C Facility. In September 2003, RFC also provided us with an acquisition, development and construction revolving credit facility for Bluegreen Resorts (the “GMAC AD&C Facility”). The project approval period on the GMAC AD&C Facility, as amended, expires on February 15, 2008, however, advances on specific projects may be taken through project commitment expiration dates ranging from July 2008 through June 2009. Outstanding borrowings mature no later than August 15, 2013, although specific draws typically are due four years from the borrowing date. Principal will be repaid through agreed-upon release prices as VOIs are sold at the financed resorts, subject to minimum required amortization. Interest payments are due monthly. During the year ended December 31, 2007, we borrowed $81.4 million under the GMAC AD&C Facility in the aggregate on our Fountains (Orlando) and Las Vegas resorts as well as the acquisition of a 27.5 acre property located on Table Rock Lake in Ridgedale, Missouri. In January 2008 we borrowed approximately $7.5 million for development at our resort in Las Vegas, Nevada and our Fountains resort in Orlando, Florida.

The 2006 BB&T Purchase Facility. In June 2006, we executed agreements for a VOI receivables purchase facility (the “2006 BB&T Purchase Facility”) with BB&T. While ownership of the receivables is transferred for legal purposes, the transfer of the receivables under the facility are accounted for as a financing transaction for financial accounting purposes. Accordingly, the receivables will continue to be reflected as assets and the associated obligations will be

reflected as liabilities on our balance sheet. The 2006 BB&T Purchase Facility utilizes an owner’s trust structure, pursuant to which we transfer receivables to Bluegreen Timeshare Finance Corporation I, our wholly-owned, special purpose finance subsidiary (“BTFC I”), and BTFC I subsequently transfers the receivables to an owner’s trust without recourse to us or BTFC I, except for breaches of certain customary representations and warranties at the time of transfer. We did not enter into any guarantees in connection with the 2006 BB&T Purchase Facility. The 2006 BB&T Purchase Facility has detailed requirements with respect to the eligibility of receivables, and fundings under the 2006 BB&T Purchase Facility are subject to certain conditions precedent. Under the 2006 BB&T Purchase Facility, as amended, a variable purchase price of approximately 83% of the principal balance of the receivables transferred, subject to certain terms and conditions, is paid at closing in cash. The balance of the purchase price is deferred until such time as BB&T and other liquidity providers arranged by BB&T have in aggregate received a specified return and all servicing, custodial, agent and similar fees and expenses have been paid. The specified return is equal to either the commercial paper rate or LIBOR rate plus 1.25%, subject to use of alternate return rates in certain circumstances. We act as servicer under the 2006 BB&T Purchase Facility for a fee. The BB&T Purchase Facility allows for transfers of notes receivable for a cumulative purchase price of up to $137.5 million, on a revolving basis, through May 2008.

In connection with the 2007 Term Securitization (described above) all amounts outstanding on the 2006 BB&T Purchase Facility were repaid. In December 2007, we transferred $20.4 million of VOI notes receivable to the 2006 BB&T Purchase Facility and received $17.0 million in cash proceeds. As of December 31, 2007, there was $17.0 million due on this facility and the remaining availability under the 2006 BB&T Purchase Facility, subject to the terms and conditions of the facility, was $120.5 million. Through February 2008, we have transferred $44.7 million of notes receivable and received $37.1 million in cash proceeds under the 2006 BB&T Purchase Facility. Our remaining availability subsequent to the transfers was $83.9 million.

The GE Bluegreen/Big Cedar Facility. In April 2007, the Bluegreen/Big Cedar Joint Venture entered into a $45.0 million revolving VOI receivables credit facility with GE (the “GE Bluegreen/Big Cedar Receivables Facility”). Bluegreen Corporation has guaranteed the full payment and performance of the Bluegreen/Big Cedar Joint Venture in connection with the GE Bluegreen/Big Cedar Receivables Facility. The facility allows for advances on a revolving basis through April 16, 2009, and all outstanding borrowings mature no later than April 16, 2016. The facility has detailed requirements with respect to the eligibility of receivables for inclusion and other conditions to funding. The borrowing base under the facility ranges from 97% - 90% (based on the spread between the weighted average note receivable coupon and GE’s interest rate) of the outstanding principal balance of eligible notes receivable arising from the sale of VOIs. The facility includes affirmative, negative and financial covenants and events of default. All principal and interest payments received on pledged receivables are applied to principal and interest due under the facility. Indebtedness under the facility bears interest adjusted monthly at the one month LIBOR rate plus 1.75%. We act as servicer under this facility for a fee. During 2007 the Bluegreen/Big Cedar Joint Venture pledged $32.0 million in aggregate principal balance of notes receivable under the facility and received $30.8 million in cash proceeds, net of issuance costs.

New Resorts Facilities in Process. The 2006 BB&T Purchase Facility and the GE Bluegreen/Big Cedar Facility discussed above are the only ongoing receivables facilities under which we currently have the ability to monetize our VOI notes receivable as of December 31, 2007. We currently have a term sheet with BB&T for a two-year $150 million revolving receivables purchase facility (the “2008 BB&T Purchase Facility”) and a term sheet with Wellington Financial for a two-year $75 million revolving receivables hypothecation facility (the “2008 Wellington Facility”). For future resort acquisition and development activities we have executed a term sheet for a two year $75 million facility with Textron Financial. There can be no assurances that these facilities will be consummated on the agreed-upon terms, or at all. Factors which could adversely impact our ability to obtain new or additional VOI receivable purchase or hypothecation facilities include a downturn in general economic conditions; negative trends in the commercial paper or LIBOR markets; increases in interest rates; a decrease in the number of financial institutions or other entities willing to enter into facilities with VOI companies; a deterioration in the performance of our VOI notes receivable or in the performance of portfolios sold in prior transactions, specifically increased delinquency, default and loss severity rates; and a deterioration in our performance generally. There can be no assurances that we will obtain new purchase facilities or will be in a position to replace our existing purchase facilities when they are fully funded or expire. As indicated above, our inability to sell VOI receivables under a current or future facility could have a material adverse impact on our liquidity. However, management believes that to the extent we could not sell receivables under a purchase facility, we could potentially mitigate the adverse impact on our liquidity by using our receivables as collateral under existing or future credit facilities.

The Foothill Facility. We are in the process of renewing and expanding to $45 million a revolving credit facility with Wells Fargo Foothill, Inc. (“Foothill”) primarily used for borrowings collateralized by Bluegreen Communities receivables and inventory, but under which we will also be able to borrow a portion of the facility collateralized by the

pledge of VOI receivables. For further details on this facility, see “Credit Facilities for Bluegreen Communities’ Receivables and Inventories” below.

Credit Facilities for Bluegreen Communities’ Receivables and Inventories

The Foothill Facility. We are in documentation for the renewal and expansion of a revolving credit facility with Foothill secured by the pledge of Bluegreen Communities’ receivables, Bluegreen Communities’ inventory borrowings and, as indicated above, up to $10.0 million of the total facility available for the pledge of Bluegreen Resorts’ receivables (the “Foothill Facility”). There can be no assurances that we will renew the Foothill Facility on favorable terms, if at all.

The GMAC Communities Facility. We have a revolving credit facility with RFC (the “GMAC Communities Facility”) for the purpose of financing our Bluegreen Communities real estate acquisitions and development activities. The GMAC Communities Facility is secured by the real property homesites (and personal property related thereto) at the following Bluegreen Communities projects, as well as any Bluegreen Communities projects acquired by us with funds borrowed under the GMAC Communities Facility (the “Secured Projects”): Catawba Falls Preserve (Black Mountain, North Carolina); Lake Ridge at Joe Pool Lake (Cedar Hill and Grand Prairie, Texas); Mystic Shores at Canyon Lake (Spring Branch, Texas); Havenwood at Hunter’s Crossing (New Braunfels, Texas); The Bridges at Preston Crossings (Grayson County, Texas); King Oaks (College Station, Texas); Vintage Oaks at the Vineyard (New Braunfels, Texas); and Sanctuary River Club at St. Andrews Sound (St. Simons Island, Georgia). In addition, the GMAC Communities Facility is secured by our Carolina National and the Preserve at Jordan Lake golf courses in Southport, North Carolina and Chapel Hill, North Carolina, respectively. The period during which we can add additional projects to the GMAC Communities Facility has expired although we can continue to borrow on projects approved prior to the expiration of individual borrowing commitments ranging from June 30, 2008 through the maturity of the facility on September 30, 2009. Principal payments are effected through agreed-upon release prices paid to RFC, as homesites in the Secured Projects are sold. Interest payments are due monthly. The GMAC Communities Facility includes customary conditions to funding, acceleration and event of default provisions and certain financial affirmative and negative covenants. We use the proceeds from the GMAC Communities Facility to finance the acquisition and development of Bluegreen Communities projects. During the year ended December 31, 2007 we borrowed $68.5 million under the GMAC Communities Facility. During January 2008, we borrowed an additional $10.2 million under the GMAC Communities Facility for general corporate purposes.

Historically, we have funded development for road and utility construction, amenities, surveys and engineering fees from internal operations and have financed the acquisition of Bluegreen Communities properties through seller, bank or financial institution loans. Terms for repayment under these loans typically call for interest to be paid monthly and principal to be repaid through homesite releases. The release price is usually an amount based on a pre-determined percentage (typically 25% to 55%) of the gross selling price of the homesites in the subdivision. In addition, the agreements generally call for minimum cumulative amortization periodically. When we provide financing to our customers (and therefore the release price is not available in cash at closing to repay the lender), we are required to pay the lender with cash derived from other operating activities, principally from cash sales or the pledge of receivables originated from earlier property sales.

Trust Preferred Securities Offerings

We have formed statutory business trusts (collectively, the “Trusts”) and each issued trust preferred securities and invested the proceeds thereof in our junior subordinated debentures. The Trusts are variable interest entities in which we are not the primary beneficiary as defined by FASB Interpretation No. 46R. Accordingly, we do not consolidate the operations of the Trusts; instead, the Trusts are accounted for under the equity method of accounting. In each of these transactions, the applicable Trust issued trust preferred securities as part of larger pooled trust securities offerings which were not registered under the Securities Act of 1933. The applicable Trust then used the proceeds from issuing the trust preferred securities to purchase an identical amount of junior subordinated debentures from us. Interest on the junior subordinated debentures and distributions on the trust preferred securities are payable quarterly in arrears at the same interest rate. Distributions on the trust preferred securities are cumulative and based upon the liquidation value of the trust preferred security. The trust preferred securities are subject to mandatory redemption, in whole or in part, upon repayment of the junior subordinated debentures at maturity or their earlier redemption. The junior subordinated debentures are redeemable in whole or in part at the Company’s option at any time after five years from the issue date or sooner following certain specified events. In addition, we made an initial equity contribution to each Trust in exchange for its common securities, all of which are owned by us, and those proceeds were also used to purchase an identical amount of junior subordinated debentures from us. The terms of each Trust’s common securities are nearly identical to the trust preferred securities.

We had the following junior subordinated debentures outstanding at December 31, 2007 (dollars in thousands):


Trust	Outstanding Amount of Junior Subordinated Debentures		Initial Equity In Trust (3)		Issue Date	Fixed Interest Rate (1)		Variable Interest Rate (2)	Beginning Optional Redemption Date	Maturity Date

Bluegreen Statutory Trust I	$	23,196	$	696	3/15/05	9.160	%	3-month LIBOR + 4.90%	3/30/10	3/30/35
Bluegreen Statutory Trust II		25,774		774	5/04/05	9.158	%	3-month LIBOR + 4.85%	7/30/10	7/30/35
Bluegreen Statutory Trust III		10,310		310	5/10/05	9.193	%	3-month LIBOR + 4.85%	7/30/10	7/30/35
Bluegreen Statutory Trust IV		15,464		464	4/24/06	10.130	%	3-month LIBOR + 4.85%	6/30/11	6/30/36
Bluegreen Statutory Trust V		15,464		464	7/21/06	10.280	%	3-month LIBOR + 4.85%	9/30/11	9/30/36
Bluegreen Statutory Trust VI		20,619		619	2/26/07	9.842	%	3-month LIBOR + 4.80%	4/30/12	4/30/37

	$	110,827	$	3,327


	(1)	Both the trust preferred securities and junior subordinated debentures bear interest at a fixed interest rate from the issue date through the beginning optional redemption date.

	(2)	Both the trust preferred securities and junior subordinated debentures bear interest at a variable interest rate from the beginning optional redemption date through the maturity date.

	(3)	Initial equity in trust is recorded as part of other assets in our consolidated balance sheets.

We currently intend to seek to create similar trusts and to participate in other pooled trust preferred securities transactions in the future as a source of additional financing, subject to market conditions and other considerations.

Unsecured Credit Facility

In August 2007, we executed agreements to renew our unsecured line-of-credit with Wachovia Bank, N.A. and increase it from $15.0 million to $20.0 million. Amounts borrowed under the line bear interest at 30-day LIBOR plus 1.75%. Interest is due monthly, and all outstanding amounts are due on July 30, 2009. The line-of-credit agreement contains certain covenants and conditions typical of arrangements of this type. As of December 31, 2007, no borrowings were outstanding under the line. However, an aggregate of $551,000 of irrevocable letters of credit were provided under this line-of-credit. This line-of-credit is an available source of short-term liquidity for us.

Commitments

Our material commitments as of December 31, 2007 included the required payments due on our receivable-backed debt, lines-of-credit and other notes payable, commitments to complete our Bluegreen Resorts and Communities projects based on our sales contracts with customers and commitments under noncancelable operating leases.

The following tables summarize the contractual minimum principal and interest payments, respectively, required on all of our outstanding debt (including our receivable-backed debt, lines-of-credit and other notes and debentures payable) and our noncancelable operating leases by period date, as of December 31, 2007 (in thousands):


	Payments Due by Period


	Less than 1 year		1 — 3 Years		4 — 5 Years		After 5 Years		Total


Contractual Obligations

Receivable-backed notes payable	$	1,050	$	1,482	$	—	$	52,467	$	54,999
Lines-of-credit and notes payable		7,442		149,992		16,331		3,213		176,978
10.50% senior secured notes		55,000		—		—		—		55,000
Jr. Subordinated debentures		—		—		—		110,827		110,827
Noncancelable operating leases		9,130		15,037		7,855		22,081		54,103

Total contractual obligations		72,622		166,511		24,186		188,588		451,907


Interest Obligations (1)

Receivable-backed notes payable		3,765		7,153		7,122		8,375		26,415
Lines-of-credit and notes payable		14,890		14,102		1,180		4,080		34,252
10.50% senior secured notes		2,888		—		—		—		2,888
Jr. Subordinated debentures		10,618		21,236		21,236		264,017		317,107

Total contractual interest		32,161		42,491		29,538		276,472		380,662

Total contractual obligations	$	104,783	$	209,002	$	53,724	$	465,060	$	832,569


	(1)	Assumes that the interest rate on variable rate debt remains the same as the rate at December 31, 2007.

We intend to use cash flow from operations, including cash received from the sale of VOI notes receivable, and cash received from new borrowings under existing or future debt facilities in order to satisfy the principal payments required on contractual obligations. While we believe that we will be able to meet all required debt payments when due, there can be no assurance that this will be the case.

We estimate that the cash required to complete resort buildings, resort amenities and other common costs in projects in which sales have occurred was approximately $18.1 million as of December 31, 2007. We estimate that the total cash required to complete our Bluegreen Communities projects in which sales have occurred was approximately $58.5 million as of December 31, 2007. These amounts assume that we are not obligated to develop any building, project or amenity in which a commitment has not been made through a sales contract to a customer; however, we anticipate that we will incur such obligations in the future. We plan to fund these expenditures over the next five years primarily with available capacity on existing or proposed credit facilities and cash generated from operations. There can be no assurance that we will be able to obtain the financing or generate the cash from operations necessary to complete the foregoing plans or that actual costs will not exceed those estimated.

We believe that our existing cash, anticipated cash generated from operations, anticipated future permitted borrowings under existing or proposed credit facilities and anticipated future sales of notes receivable under the purchase facilities and one or more replacement facilities we will seek to put in place will be sufficient to meet our anticipated working capital, capital expenditures and debt service requirements for the foreseeable future. We will be required to renew or replace credit and receivables purchase facilities that have expired or that will expire in the near term. We will, in the future, also require additional credit facilities or will be required to issue corporate debt or equity securities in connection with acquisitions or otherwise. Any debt incurred or issued by us may be secured or unsecured, bear fixed or variable rate interest and may be subject to such terms as the lender may require and management believes acceptable. There can be no assurance that the credit facilities or receivables purchase facilities which have expired or which are scheduled to expire in the near term will be renewed or replaced or that sufficient funds will be available from operations or under existing, proposed or future revolving credit or other borrowing arrangements or receivables purchase facilities to meet our cash needs, including, our debt service obligations. To the extent we are not able to sell notes receivable or borrow under such facilities, our ability to satisfy our obligations would be materially adversely affected.

Our credit facilities, indentures, and other outstanding debt instruments, and receivables purchase facilities include customary conditions to funding, eligibility requirements for collateral, cross-default and other acceleration provisions, certain financial and other affirmative and negative covenants, including, among others, limits on the incurrence of indebtedness, limits on the repurchase of securities, payment of dividends, investments in joint ventures and other restricted payments, the incurrence of liens, transactions with affiliates, covenants concerning net worth, fixed charge coverage requirements, debt-to-equity ratios, portfolio performance requirements and events of default or termination. No assurance can be given that we will not be required to seek waivers of such covenants or that such covenants will not limit our ability to raise funds, sell receivables, satisfy or refinance our obligations or otherwise adversely affect our operations. In addition, our future operating performance and ability to meet our financial obligations will be subject to future economic conditions and to financial, business and other factors, many of which will be beyond our control.


Item 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Foreign Currency Risk

Our total revenues and net assets denominated in a currency other than U.S. dollars during the year ended December 31, 2007 were approximately 1% of consolidated revenues and consolidated assets, respectively. Sales generated by Bluegreen Properties, N.V., our subsidiary in Aruba, are transacted in U.S. dollars. The effects of changes in foreign currency exchange rates have not historically been significant to our operations or net assets.

Interest Rate Risk

We sold $228.8 million, $243.6 million, and $266.9 million of fixed-rate VOI notes receivable off-balance sheet during 2005, 2006 and 2007, respectively, under various vacation ownership receivable purchase facilities and term securitization transactions (See Note 6 of the Notes to Consolidated Financial Statements for further information). Our gains on sale recognized are generally based upon either fixed or variable interest rates at the time of sale including the prevailing weighted-average term treasury rate, commercial paper rates or LIBOR rates (depending on the purchase facility in effect) and many other factors including, but not limited to the weighted-average coupon rate and remaining contractual life of the loans sold, and assumptions regarding the constant prepayment rate, loss severity, annual default and discount rates. See Note 7 in the Notes to the consolidated financial statements for the hypothetical change in fair value or our retained interest in notes receivable sold based on adverse changes in assumptions including discount rate.

As of December 31, 2007, we had fixed interest rate debt of approximately $168.7 million and floating interest rate debt of approximately $229.1 million. In addition, our notes receivable from VOI and homesite customers were comprised of $173.9 million of fixed rate loans and $4.2 million of notes bearing floating interest rates. The floating interest rates are based either upon the prevailing prime or LIBOR interest rates. For floating rate financial instruments, interest rate changes do not generally affect the market value of debt but do impact future earnings and cash flows, assuming other factors are held constant. Conversely, for fixed rate financial instruments, interest rate changes affect the market value of the debt but do not impact earnings or cash flows.

A hypothetical one-percentage point increase in the prevailing prime or LIBOR rates, as applicable, would, as a result of increased interest expense on variable rate debt, decrease our after-tax earnings by an immaterial amount per year, partially offset by the increased interest income on variable rate Bluegreen Communities notes receivable and cash and cash equivalents. A similar change in interest rates would decrease the total fair value of our fixed rate debt, excluding our 10.50% senior secured notes payable (the “Notes”) by an immaterial amount. The fact that the Notes are publicly traded in the over-the-counter market makes it impractical to estimate the effect of the hypothetical change in interest rates on the fair value of the Notes. Due to the non-interest related factors involved in determining the fair value of these publicly traded securities, their fair values have historically demonstrated increased, decreased or at times contrary relationships to changes in interest rates as compared to other types of fixed-rate debt securities. The analyses do not consider the effects of the reduced level of overall economic activity that could exist in such an environment. Further, in the event of a change in interest rates, we would likely attempt to take actions to mitigate any exposure to the change. However, due to the uncertainty of the specific actions that would be taken and their possible effects, the foregoing sensitivity analysis assumes no changes in our financial structure.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

BLUEGREEN CORPORATION
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)


	December 31, 2006				December 31, 2007

ASSETS
Cash and cash equivalents (including restricted cash of $21,476 and $19,460 at December 31, 2006 and 2007, respectively)		$	71,148			$	144,973
Contracts receivable, net			23,856				20,532
Notes receivable (net of allowance of $13,499 and $17,458 at December 31, 2006 and 2007, respectively)			144,251				160,665
Prepaid expenses			10,800				14,824
Other assets			27,465				23,405
Inventory, net			349,333				434,968
Retained interests in notes receivable sold			130,623				141,499
Property and equipment, net			92,445				94,421
Goodwill			4,291				4,291

Total assets		$	854,212			$	1,039,578


LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities
Accounts payable		$	18,465			$	38,901
Accrued liabilities and other			49,458				60,421
Deferred income			40,270				36,559
Deferred income taxes			87,624				98,362
Receivable-backed notes payable			21,050				54,999
Lines-of-credit and notes payable			124,412				176,978
10.50% senior secured notes payable			55,000				55,000
Junior subordinated debentures			90,208				110,827

Total liabilities			486,487				632,047

Minority interest			14,702				22,423

Commitments and contingencies

Shareholders’ Equity
Preferred stock, $.01 par value, 1,000 shares authorized; none issued			—				—
Common stock, $.01 par value, 90,000 shares authorized; 33,603 and 33,957 shares issued at December 31, 2006 and 2007, respectively			336				339
Additional paid-in capital			175,164				178,144
Treasury stock, 2,756 common shares at both December 31, 2006 and 2007, at cost			(12,885	)			(12,885	)
Accumulated other comprehensive income, net of income taxes			12,632				9,808
Retained earnings			177,776				209,702

Total shareholders’ equity			353,023				385,108

Total liabilities and shareholders’ equity		$	854,212			$	1,039,578

See accompanying notes to consolidated financial statements.

BLUEGREEN CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)


	Year Ended December 31, 2005		Year Ended December 31, 2006			Year Ended December 31, 2007


Revenues:
Gross sales of real estate	$	550,335	$	583,795		$	605,250
Estimated uncollectible VOI notes receivable		—		(59,497	)		(65,242	)
Gains on sales of VOI notes receivable (Resort sales portion)		—		38,848			42,750

Sales of real estate		550,335		563,146			582,758

Other resort and communities operations revenue		73,797		63,610			67,411
Interest income		34,798		40,765			44,703
Sales of notes receivable		25,226		5,852			(3,378	)

		684,156		673,373			691,494

Costs and expenses:
Cost of real estate sales		177,800		179,054			178,731
Cost of other resort and communities operations		77,317		53,193			49,982
Selling, general and administrative expenses		300,239		356,989			377,551
Interest expense		14,474		18,785			24,272
Other expense, net		6,207		2,861			1,743
Provision for loan losses		27,587		—			—

		603,624		610,882			632,279

Income before minority interest and provision for income taxes		80,532		62,491			59,215
Minority interest in income of consolidated subsidiary		4,839		7,319			7,721

Income before provision for income taxes and cumulative effect of change in accounting principles		75,693		55,172			51,494
Provision for income taxes		29,142		20,861			19,568

Income before cumulative effect of change in accounting principle		46,551		34,311			31,926
Cumulative effect of change in accounting principle, net of tax		—		(5,678	)		—
Minority interest in cumulative effect of change in accounting principle		—		1,184			—

Net income	$	46,551	$	29,817		$	31,926


Income before cumulative effect of change in accounting principle per common share:
Basic	$	1.53	$	1.12		$	1.03

Diluted	$	1.49	$	1.10		$	1.02


Cumulative effect of change in accounting principle, net of tax and net of minority interest in income of cumulative effect of change in accounting principle per common share:
Basic	$	—	$	(0.15	)	$	—

Diluted	$	—	$	(0.14	)	$	—


Net income per common share:
Basic	$	1.53	$	0.98		$	1.03

Diluted	$	1.49	$	0.96		$	1.02


Weighted average number of common and common equivalent shares:
Basic		30,381		30,557			30,975

Diluted		31,245		31,097			31,292

See accompanying notes to consolidated financial statements.

BLUEGREEN CORPORATION

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(in thousands)


	Common Shares Issued		Common Stock			Additional Paid-in Capital			Treasury Stock at Cost				Accumulated Other Comprehensive Income, Net of Income Taxes				Retained Earnings			Total


Balance at December 31, 2004		32,990		$	330		$	167,408		$	(12,885	)		$	4,805			$	101,408		$	261,066
Net income		—			—			—			—				—				46,551			46,551

Net unrealized gains on retained interests in notes receivable sold, net of income taxes and reclassification adjustments		—			—			—			—				3,770				—			3,770

Comprehensive income																						50,321
Shares issued upon exercise of stock options		271			3			1,403			—				—				—			1,406
Modification of equity awards and vesting of restricted stock		6			—			327			—				—				—			327
Income tax benefit from stock options exercised		—			—			541			—				—				—			541
Shares issued in connection with conversion of 8.25% convertible subordinated debentures		1			—			5			—				—				—			5


Balance at December 31, 2005		33,268			333			169,684			(12,885	)			8,575				147,959			313,666

Net income		—			—			—			—				—				29,817			29,817

Net unrealized gains on retained interests in notes receivable sold, net of income taxes and reclassification adjustments		—			—			—			—				4,057				—			4,057

Comprehensive income																						33,874
Shares issued upon exercise of stock options		312			3			2,642			—				—				—			2,645
Stock option expense		—			—			2,103			—				—				—			2,103
Modification of equity awards and vesting of restricted stock		23			—			735			—				—				—			735

Balance at December 31, 2006		33,603			336			175,164			(12,885	)			12,632				177,776			353,023

Net income		—			—			—			—				—				31,926			31,926
Net unrealized losses on retained interests in notes receivable sold, net of income taxes and reclassification adjustments		—			—			—			—				(2,824	)			—			(2,824	)

Comprehensive income																						29,102
Shares issued upon exercise of stock options		140			1			558			—				—				—			559
Stock option expense		—			—			2,052			—				—				—			2,052
Vesting of restricted stock		214			2			370			—				—				—			372

Balance at December 31, 2007		33,957		$	339		$	178,144		$	(12,885	)		$	9,808			$	209,702		$	385,108

See accompanying notes to consolidated financial statements.

BLUEGREEN CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)


	Year Ended December 31, 2005				Year Ended December 31, 2006				Year Ended December 31, 2007

Operating activities:
Net income		$	46,551			$	29,817			$	31,926
Adjustments to reconcile net income to net cash provided (used) by operating activities:
Cumulative effect of change in accounting principle, net			—				5,678				—
Non-cash stock compensation expense			327				2,848				2,422
Minority interest in income of consolidated subsidiary			4,839				6,135				7,721
Depreciation			12,332				14,376				14,489
Amortization			5,807				2,793				3,180
Gain on sales of notes receivable			(25,226	)			(44,700	)			(39,372	)
Loss on disposal of property and equipment			94				2,096				688
Provision for loan losses			27,587				59,489				65,419
Provision for deferred income taxes			16,979				12,835				12,468
Interest accretion on retained interests in notes receivable sold			(9,310	)			(14,569	)			(15,157	)
Proceeds from sales of notes receivable			198,260				218,455				229,067
Changes in operating assets and liabilities:
Contracts receivable			612				3,854				3,324
Notes receivable			(220,491	)			(283,305	)			(305,972	)
Prepaid expenses and other assets			2,120				(12,009	)			(473	)
Inventory			29,022				(8,273	)			(59,322	)
Accounts payable, accrued liabilities and other			6,022				12,906				28,471

Net cash provided (used) by operating activities			95,525				8,426				(21,121	)


Investing activities:
Cash received from retained interests in notes receivable sold			11,016				30,032				35,949
Business acquisition			(675	)			—				—
Investments in statutory business trusts			(1,780	)			(928	)			(619	)
Purchases of property and equipment			(16,724	)			(24,736	)			(15,855	)
Proceeds from sales of property and equipment			22				93				2

Net cash (used) provided by investing activities			(8,141	)			4,461				19,477


Financing activities:
Proceeds from borrowings collateralized by notes receivable			24,772				68,393				151,973
Payments on borrowings collateralized by notes receivable			(64,714	)			(85,114	)			(120,145	)
Proceeds from borrowings under line-of-credit facilities and notes payable			26,382				56,670				147,835
Payments under line-of-credit facilities and notes payable			(92,071	)			(94,586	)			(123,320	)
Payments on 10.50% senior secured notes			(55,000	)			—				—
Proceeds from issuance of junior subordinated debentures			59,280				30,928				20,619
Payments of debt issuance costs			(3,300	)			(4,438	)			(2,052	)
Proceeds from exercise of employee and director stock options			1,406				2,645				559
Distributions to minority interest			—				(941	)			—

Net cash (used) provided by financing activities			(103,245	)			(26,443	)			75,469

Net (decrease) increase in cash and cash equivalents			(15,861	)			(13,556	)			73,825
Cash and cash equivalents at beginning of period			100,565				84,704				71,148

Cash and cash equivalents at end of period			84,704				71,148				144,973
Restricted cash and cash equivalents at end of period			(18,321	)			(21,476	)			(19,460	)

Unrestricted cash and cash equivalents at end of period		$	66,383			$	49,672			$	125,513

See accompanying notes to consolidated financial statements

BLUEGREEN CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS—(Continued)
(in thousands)


	Year Ended December 31, 2005			Year Ended December 31, 2006			Year Ended December 31, 2007

Supplemental schedule of non-cash operating, investing and financing activities:
Inventory acquired through foreclosure or deedback in lieu of foreclosure		$	10,585		$	—		$	—

Inventory acquired through financing		$	54,054		$	95,698		$	26,425

Property and equipment acquired through financing		$	1,114		$	4,640		$	1,188

Offset of Joint Venture distribution of operating proceeds to minority interest against the Prepayment (see Note 4)		$	1,340		$	—		$	—

Retained interests in notes receivable sold		$	38,913		$	33,967		$	36,222


Change in unrealized gains on retained interests in notes receivable sold		$	6,130		$	6,423		$	(4,554	)

Income tax benefit from stock options exercised		$	541		$	—		$	—


Supplemental schedule of operating cash flow information:
Interest paid, net of amounts capitalized		$	15,955		$	17,171		$	24,407

Income taxes paid		$	6,646		$	10,064		$	9,823

See accompanying notes to consolidated financial statements.

BLUEGREEN CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Significant Accounting Policies

Organization

We provide Colorful Places to Live and Play® through our resorts and residential communities businesses. Our resorts business (“Bluegreen Resorts”) acquires, develops, markets, sells and manages real estate-based vacation ownership interests (“VOIs”) in resorts generally located in popular, high-volume, “drive-to” vacation destinations. VOIs in our resorts typically entitle the buyer to use resort accommodations through an annual or biennial allotment of “points” which represent their ownership and beneficial use rights in perpetuity in our Bluegreen Vacation Club (supported by an underlying deeded VOI held in trust for the buyer). Depending on the extent of their ownership and beneficial rights, members in our Bluegreen Vacation Club may stay in any of our participating resorts or take advantage of an exchange program offered by a third-party world-wide vacation ownership exchange network of over 3,700 resorts and other vacation experiences such as cruises and hotel stays. We are currently marketing and selling VOIs in 22 resorts located in the United States and Aruba. We also sell VOIs at seven off-site sales offices and on the campus of one resort under development located in the United States. Additionally, club members who acquired or upgraded their VOIs on or after November 1, 2007 also have access to 18 Shell Vacation Club (“Shell”) resorts, through our Select Connections™ joint venture with Shell. Shell is an unaffiliated privately-held resort developer. Our residential communities business (“Bluegreen Communities”) acquires, develops and subdivides property and markets residential homesites, the majority of which are sold directly to retail customers who seek to build a home in a high quality residential setting, in some cases on properties featuring a golf course and other related amenities. Our other resort and communities operations revenues consist primarily of resort property management services, resort title services, resort amenity operations, non-cash sales incentives provided to buyers of VOIs, rental brokerage services, realty operations and daily-fee golf course operations. We also generate significant interest income by providing financing to individual purchasers of VOIs.

Principles of Consolidation

Our consolidated financial statements include the accounts of all of our wholly-owned subsidiaries and entities in which we hold a controlling financial interest. The only non-wholly owned subsidiary that we consolidate is Bluegreen/Big Cedar Vacations, LLC (the “Bluegreen/Big Cedar Joint Venture”), as we hold a 51% equity interest in the Bluegreen/Big Cedar Joint Venture, have an active role as the day-to-day manager of the Bluegreen/Big Cedar Joint Venture’s activities, and have majority voting control of the Bluegreen/Big Cedar Joint Venture’s management committee. We do not consolidate our statutory business trusts (see Note 13) formed to issue trust preferred securities as these entities are each variable interest entities in which we are not the primary beneficiary as defined by Financial Accounting Standards Board (“FASB”) Interpretation No. 46R (“FIN No. 46R”). The statutory business trusts are accounted for under the equity method of accounting. We have eliminated all significant intercompany balances and transactions.

Use of Estimates

United States generally accepted accounting principles require us to make estimates and assumptions that affect the amounts reported in our consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

Cash and Cash Equivalents

We invest cash in excess of our immediate operating requirements in short-term time deposits and money market instruments generally with original maturities at the date of purchase of three months or less. We maintain cash and cash equivalents with various financial institutions. These financial institutions are located throughout the United States, Canada and Aruba. Our policy is designed to limit exposure to any one institution. However, a significant portion of our unrestricted cash is maintained with a single bank and, accordingly, we are subject to credit risk. Periodic evaluations of the relative credit standing of financial institutions maintaining our deposits are performed to evaluate and mitigate, if necessary, credit risk.

Restricted cash consists primarily of customer deposits held in escrow accounts.

Revenue Recognition and Contracts Receivable

In accordance with the requirements of Statement of Financial Accounting Standards (“SFAS”) No. 66, Accounting for Sales of Real Estate, as amended by SFAS No. 152, Accounting for Real Estate Time-Sharing Transactions (“SFAS No. 152”), we recognize revenue on VOI and homesite sales when a minimum of 10% of the sales price has been received in cash (demonstrating the buyer’s commitment), the legal rescission period has expired, collectibility of the receivable representing the remainder of the sales price is reasonably assured and we have completed substantially all of our obligations with respect to any development related to the real estate sold. We believe that we use a reasonably reliable methodology to estimate the collectibility of the receivables representing the remainder of the sales price of real estate sold. See the further discussion of our policies regarding the estimation of credit losses on our notes receivable below. Should our estimates regarding the collectibility of our receivables change adversely, we may have to defer the recognition of sales and our results of operations could be negatively impacted. Upon the adoption of SFAS No. 152 on January 1, 2006, the calculation of the adequacy of a buyer’s commitment for the sale of VOIs changed so that cash received towards the purchase of our VOIs is reduced by the value of certain incentives provided to the buyer at the time of sale. If after considering the value of the incentive the 10% requirement is not met, the VOI sale, and the related cost and direct selling expenses, are deferred until such time that sufficient cash is received from the customer, generally through receipt of mortgage payments. Changes to the quantity, type, or value of sales incentives that we provide to buyers of our VOIs may result in additional VOI sales being deferred, and thus our results of operations could be materially adversely impacted.

In cases where all development has not been completed, we recognize revenue in accordance with the percentage-of-completion method of accounting. Should our estimates of the total anticipated cost of completing one of our Bluegreen Resorts’ or Bluegreen Communities’ projects increase, we may be required to defer a greater amount of revenue or may be required to defer revenue for a longer period of time, and thus our results of operations could be materially adversely impacted.

Contracts receivable consists of: (1) amounts receivable from customers on recent sales of VOIs pending recording of the customers’ notes receivable in our loan servicing system; (2) receivables related to unclosed homesite sales; and, (3) receivables from third-party escrow agents on recently closed homesite sales. Contracts receivable are reflected net of an allowance for cancellations of unclosed Bluegreen Communities’ sales contracts, which totaled approximately $0.6 million and $0.3 million at December 31, 2006 and 2007, respectively. Contracts receivable are stated net of a reserve for loan losses of $0.5 million and $0.9 million at December 31, 2006 and 2007, respectively.

Our other resort and communities operations revenues consist primarily of sales and service fees from the activities listed below. The table provides a brief description of the applicable revenue recognition policy:


Activity		Revenue is recognized as:

Vacation ownership tour sales		Vacation ownership tour sales commissions are earned per contract terms with third parties.

Resort title fees		Escrow amounts are released and title documents are completed.

Management fees		Management services are rendered.

Rental commissions		Rental services are provided.

Rental income		Guests complete stays at the resorts. Effective January 1, 2006, rental income is classified as a reduction to “Cost of other resort and communities operations”.

Realty commissions		Sales of third-party-owned real estate are completed.

Golf course and ski hill daily fees		Services are provided.

Mini-vacation package sales to third parties		Mini-vacation packages are fulfilled (i.e., guests use mini-vacation packages to stay at a hotel, take a cruise, etc.). During 2006, we transitioned our mini-vacation business so that substantially all mini-vacation tours are used internally at a Bluegreen sales office. Mini-vacation packages used for internal purposes are deferred and recognized as a credit to marketing expense.

Our cost of other resort and communities operations consists of the costs associated with the various revenues described above as well as developer subsidies and maintenance fees on our unsold VOIs.

Notes Receivable

Our notes receivable are carried at amortized cost less an allowance for bad debts. Interest income is suspended and previously accrued but unpaid interest income is reversed on all delinquent notes receivable when principal or interest payments are more than three months contractually past due and not resumed until such loans are less than three months past due. As of December 31, 2006 and 2007, $3.0 million and $3.1 million, respectively, of our notes receivable were more than three months contractually past due and, hence, were not accruing interest income.

Prior to January 1, 2006, we estimated credit losses on our notes receivable portfolios generated in connection with the sale of VOIs and homesites in accordance with SFAS No. 5, Accounting for Contingencies, as our notes receivable portfolios consisted of large groups of smaller-balance, homogeneous loans. Consistent with Staff Accounting Bulletin No. 102, Selected Loan Loss Allowance Methodology and Documentation Issues, we first segmented our notes receivable by identifying risk characteristics that are common to groups of loans and then estimated credit losses based on the risks associated with these segments. Under this method, the amount of loss was reduced by the estimated value of the defaulted inventory to be recovered. Although this policy continues for notes receivable generated in connection with the sale of homesites, effective January 1, 2006, we changed our accounting for loan losses for VOI notes receivable in accordance with SFAS No. 152. Under SFAS No. 152, we estimate uncollectibles based on historical uncollectibles for similar VOI notes receivable over the applicable historical period. We use a static pool analysis, which tracks uncollectibles for each year’s sales over the entire life of those notes. We also consider whether the historical economic conditions are comparable to current economic conditions. Additionally, under SFAS No. 152 no consideration is given for future recoveries of defaulted inventory in the estimate of uncollectible VOI notes receivable. We review our reserve for loan losses on at least a quarterly basis.

Retained Interest in Notes Receivable Sold

When we sell our notes receivable either pursuant to our vacation ownership receivables purchase facilities (more fully described in Note 6) or through term securitizations, we evaluate whether or not such transfers should be accounted for as a sale pursuant to SFAS No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities (“SFAS No. 140”) and related interpretations. The evaluation of sale treatment under SFAS No. 140 involves legal assessments of the transactions, which include determining whether the transferred assets have been isolated from us (i.e., put presumptively beyond our reach and the reach of our creditors, even in bankruptcy or other receivership), determining whether each transferee has the right to pledge or exchange the assets it received, and ensuring that we do not maintain effective control over the transferred assets through either an agreement that either: (1) entitles and obligates us to repurchase or redeem the assets before their maturity; or (2) provides us with the ability to unilaterally cause the holder to return the assets (other than through a cleanup call).

In connection with such transactions, we retain subordinated tranches and rights to excess interest spread which are retained interests in the notes receivable sold. Gain or loss on the sale of the receivables depends in part on the allocation of the previous carrying amount of the financial assets involved in the transfer between the assets sold and the retained interests based on their relative fair value at the date of transfer.

We consider our retained interests in notes receivable sold as available-for-sale investments and, accordingly, carry them at fair value in accordance with SFAS No. 115, Accounting for Certain Investments in Debt and Equity Securities . Unrealized gains or losses on our retained interests in notes receivable sold are included in our shareholders’ equity as accumulated other comprehensive income, net of income taxes. Declines in fair value that are determined to be other than temporary are charged to operations.

We measure the fair value of the retained interests in the notes receivable sold initially and on a quarterly basis based on the present value of estimated future expected cash flows using our best estimates of the key assumptions – prepayment rates, loss severity rates, default rates and discount rates commensurate with the risks involved. Interest on the retained interests in notes receivable sold is accreted using the effective yield method.

Inventory

Our inventory consists of completed VOIs, VOIs under construction, land held for future vacation ownership development and residential land acquired or developed for sale. We carry our inventory at the lower of cost, including costs of improvements and amenities incurred subsequent to acquisition, capitalized interest, real estate taxes and other

costs incurred during construction, or estimated fair value, less cost to dispose. Through December 31, 2005, homesites and VOIs reacquired upon default of the related receivable were considered held for sale and were recorded at fair value less costs to sell. Although this practice continues for homesites reacquired, the adoption of SFAS No. 152 on January 1, 2006 changed our method of accounting for VOI inventory, including future recoveries from defaults. Under SFAS No. 152, VOI inventory and cost of sales is accounted for using the relative sales value method. Under the relative sales value method, cost of sales is calculated as a percentage of net sales using a cost-of-sales percentage—the ratio of total estimated development cost to total estimated VOI revenue, including the estimated incremental revenue from the resale of VOI inventory repossessed, generally as a result of the default of the related receivable. Also, pursuant to SFAS No. 152, we do not relieve inventory for VOI cost of sales related to anticipated credit losses. We periodically evaluate the recovery of the carrying amount of our individual resort and residential communities’ properties under the guidelines of SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets (“SFAS No. 144”).

Property and Equipment

Our property and equipment acquired is recorded at cost. We record depreciation and amortization in a manner that recognizes the cost of our depreciable assets in operations over their estimated useful lives using the straight-line method. Leasehold improvements are amortized over the shorter of the terms of the underlying leases or the estimated useful lives of the improvements. Depreciation expense includes the amortization of assets recorded under capital leases. We evaluate the recovery of the carrying amounts of our long-lived assets under the guidelines of SFAS No. 144.

Goodwill

Our goodwill primarily relates to a business combination whereupon Great Vacation Destinations, Inc. (“GVD”), one of our wholly-owned subsidiaries, acquired substantially all the assets and assumed certain liabilities of TakeMeOnVacation, LLC, RVM Promotions, LLC, and RVM Vacations, LLC (collectively, “TMOV”) in 2002. As of December 31, 2006 and 2007, goodwill was allocated to our Resorts Division. We account for our goodwill under the provisions of SFAS No. 142, Goodwill and Other Intangible Assets. This statement requires that goodwill deemed to have indefinite lives not be amortized, but rather be tested for impairment on an annual basis. Our impairment analysis during the years ended December 31, 2005, 2006, and 2007 determined that no goodwill impairment existed.

Treasury Stock

We account for repurchases of our common stock using the cost method with common stock in treasury classified in our consolidated balance sheets as a reduction of shareholders’ equity.

Advertising Expense

We expense advertising costs as incurred. Advertising expense was $102.7 million, $123.0 million and $130.5 million for the years ended December 31, 2005, 2006, and 2007, respectively. Advertising expense is included in selling, general and administrative expenses in our consolidated statements of income.

Stock-Based Compensation

We recognize stock-based compensation expense under the provisions of SFAS No. 123R, Share-Based Payment (revised 2004) (“SFAS No. 123R”), which we adopted January 1, 2006, utilizing the modified prospective method.

We utilize the Black-Scholes option pricing model for calculating the fair value of each option granted. The Black-Scholes option-pricing model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. In addition, this model requires the input of subjective assumptions, including the expected price volatility of the underlying stock. Projected data related to the expected volatility and expected life of stock options is based upon historical and other information. Changes in these subjective assumptions can materially affect the fair value of the estimate, and therefore, the existing valuation models do not provide a precise measure of the fair value of our employee stock options. Additionally, SFAS No. 123R also requires us to estimate forfeitures in calculating the expense relating to stock-based compensation.

There were 440,000 stock options granted to our employees during 2006. There were 142,785 stock options and 17,497 shares of restricted common stock granted to our non-employee directors during 2006. During 2007 there were no stock options granted and there were 196,850 shares of restricted stock granted to our employees. Additionally, during 2007 there were 136,494 stock options and 16,696 shares of restricted common stock granted to our non-employee directors.

All stock options were granted with an exercise price equal to the closing price of our common stock on the date of grant.

The fair value for these options was estimated at the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:


	During the year ended December 31,

	2005	2006	2007

Risk free investment rate	3.9%	5.0%	4.9%
Dividend yield	0.0%	0.0%	0.0%
Volatility factor of expected market price	61.0%	53.0%	45.8%
Life of option	5.5 years	5.8 years	5.0 years

The Company uses historical data to estimate option exercise behavior and employee termination. The risk free investment rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The Company uses the historical volatility of the Company’s traded stock to estimate the volatility factor of expected market price.

We recognize stock-based compensation expense on a straight-line basis over the service or vesting period of the instrument. Total compensation costs related to stock-based compensation charged against income during the year ended December 31, 2007 was $2.4 million. Total stock-based compensation recorded in 2007 consists of $2.0 million related to the expense of existing and newly granted stock options and $0.4 million related to existing and newly granted restricted stock. At the grant date, the Company estimates the numbers of shares expected to vest and subsequently adjusts compensation costs for the estimated rate of forfeitures at the option grant date and on an annual basis. The Company uses historical data to estimate option exercise behavior and employee termination in determining the estimated forfeiture rate. The estimated forfeiture rate applied as of the most recent option grant date during 2007 was 16%. Total compensation costs related to stock-based compensation charged against income during the year ended December 31, 2006 was $2.8 million. Total stock-based compensation recorded in 2006 consists of $2.1 million related to the expense of existing and newly granted stock options, $0.2 million related to existing and newly granted restricted stock, and $0.6 million related to the modification of existing stock option grants, which accelerated the vesting of approximately 85,000 stock options for one employee.

As of December 31, 2007, there were approximately $7.7 million of total unrecognized compensation costs related to non-vested stock-based compensation arrangements under our stock compensation plans. The costs for stock options granted are expected to be recognized over a weighted-average period of 2.6 years. The costs for restricted stock granted are expected to be recognized over a weighted-average period of 4.3 years During the years ended December 31, 2005, 2006, and 2007 the total fair value of shares vested was $2.3 million, $1.8 million and $616,000, respectively. A summary of the status of the Company’s non-vested restricted shares as of December 31, 2007, and changes during the year ended December 31, 2007, is as follows:


Non-vested Restricted Shares	Number of Shares			Weighted- Average Grant-Date Fair Value

	(in 000’s)

Non-vested at January 1, 2007		14,482		$	12.91
Granted		213,546			11.98
Vested		(17,097	)		11.70
Forfeited		—

Non-vested at December 31, 2007		210,931		$	12.07

SFAS No. 123R requires companies to continue to provide the pro forma disclosures required by SFAS No. 123, as amended for all periods presented in which share-based payments were accounted for under the intrinsic value method of APB 25. The following table illustrates the pro forma effect on net income and earnings per common share as if we had applied the fair-value recognition provisions of SFAS No. 123 to all of our share-based compensation awards for periods prior to the adoption of SFAS No. 123R (in thousands, except per share data):


	Year Ended December 31, 2005


Net income, as reported		$	46,551
Add: Total stock-based compensation expense included in the determination of reported net income, net of related tax effects			207
Deduct: Total stock-based compensation expense determined under the fair value-based method for all awards, net of related tax effects			(1,493	)

Pro forma net income		$	45,265


Earnings per share, as reported:
Basic		$	1.53
Diluted		$	1.49
Pro forma earnings per share:
Basic		$	1.49
Diluted		$	1.45

Earnings Per Common Share

We compute basic earnings per common share by dividing net income by the weighted-average number of common shares outstanding. Diluted earnings per common share is computed in the same manner as basic earnings per share, but also gives effect to all dilutive stock options and unvested restricted shares using the treasury stock method. There were approximately 0.8 million, 0.8 million, and 1.3 million stock options not included in diluted earnings per common share during the years ended December 31, 2005, 2006, and 2007, respectively, as the effect would be anti-dilutive.

The following table sets forth our computation of basic and diluted earnings per common share (in thousands, except per share data):


	Year Ended December 31,

	2005		2006		2007


Basic and diluted earnings per common share — numerator:
Net income	$	46,551	$	29,817	$	31,926

Denominator:
Denominator for basic earnings per common share-weighted-average shares		30,381		30,557		30,975
Effect of dilutive securities:
Stock options and unvested restricted stock		864		540		317

Denominator for diluted earnings per common share-adjusted weighted-average shares and assumed conversions		31,245		31,097		31,292

Basic earnings per common share:	$	1.53	$	0.98	$	1.03

Diluted earnings per common share:	$	1.49	$	0.96	$	1.02

Comprehensive Income

SFAS No. 130, Reporting Comprehensive Income , requires the change in net unrealized gains or losses on our retained interests in notes receivable sold, which are held as available-for-sale investments, to be included in other comprehensive income. Comprehensive income is shown as a subtotal within our consolidated statements of shareholders’ equity for each period presented.

Recent Accounting Pronouncements Not Yet Adopted

In September 2006, the FASB issued FAS No. 157, Fair Value Measurements (“SFAS No. 157”). SFAS No. 157 defines fair value, establishes a methodology for measuring fair value, and expands the required disclosure for fair value measurements. SFAS No. 157 is effective for us beginning with our 2008 fiscal year, at which time it will be applied prospectively. In February 2008, the FASB agreed to partially defer the effective date, for one year, of SFAS No. 157,

for non-financial assets and liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis. We are currently evaluating the impact that FAS No. 157 will have on our financial statements.

In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities Including an Amendment of FASB Statement No. 115 (“SFAS No. 159”). SFAS No. 159 permits entities to choose to measure many financial instruments and certain other items at fair value and is effective for us beginning with our 2008 fiscal year. We do not expect to elect the fair value measurement option for any financial assets or liabilities at the present time.

On December 4, 2007, the FASB issued SFAS No. 141 (Revised 2007), Business Combinations (“SFAS No. 141(R)”). SFAS No. 141(R) will significantly change the accounting for business combinations. Under SFAS No. 141(R), an acquiring entity will be required to recognize all the assets acquired and liabilities assumed in a transaction at the acquisition-date fair value with limited exceptions. SFAS No. 141(R) also includes a substantial number of new disclosure requirements. SFAS No. 141(R) must be applied prospectively to business combinations for which the acquisition date is on or after January 1, 2009. We are currently evaluating the impact that SFAS No. 141(R) will have on our financial statements.

On December 4, 2007, the FASB issued SFAS No. 160, Non-controlling Interests in Consolidated Financial Statements-an Amendment of Accounting Research Bulletin (“ARB”) No. 51 (“SFAS No. 160”). SFAS No. 160 establishes new accounting and reporting standards for a non-controlling interest in a subsidiary and for the deconsolidation of a subsidiary. Specifically, this statement requires the recognition of a non-controlling interest (minority interest) as equity in the consolidated financial statements separate from the parent’s equity. The amount of net income attributable to the non-controlling interest will be included in consolidated net income on the face of the income statement. SFAS No. 160 clarifies that changes in a parent’s ownership interest in a subsidiary that do not result in deconsolidation are equity transactions if the parent retains its controlling financial interest. In addition, this statement requires that a parent recognize a gain or loss in net income when a subsidiary is deconsolidated. Such gain or loss will be measured using the fair value of the non-controlling equity investment on the deconsolidation date. SFAS No. 160 also includes expanded disclosure requirements regarding the interests of the parent and its non-controlling interest. SFAS No. 160 is effective for us beginning with our 2009 fiscal year. We are currently evaluating the impact that SFAS No. 160 will have on our financial statements.

2. Cumulative Effect of Change in Accounting Principle

Effective January 1, 2006, we adopted SFAS No. 152, Accounting for Real Estate Time-Sharing Transactions (“SFAS No. 152”). This statement amends SFAS No. 66, Accounting for Sales of Real Estate , and SFAS No. 67, Accounting for Costs and Initial Rental Operations of Real Estate Projects , in association with the issuance of American Institute of Certified Public Accountants (“AICPA”) Statement of Position (“SOP”) 04-2, Accounting for Real Estate Time-Sharing Transactions . SFAS No. 152 was issued to address the diversity in practice resulting from a lack of guidance specific to the timeshare industry. Among other things, the new standard addresses the treatment of sales incentives provided by a seller to a buyer to consummate a transaction, the calculation of and presentation of uncollectible notes receivable, the recognition of changes in inventory cost estimates, recovery or repossession of VOIs, selling and marketing costs, operations during holding periods, developer subsidies to property owners’ associations and upgrade and reload transactions. Restatement of previously reported financial statements is not permitted. Accordingly, as a result of the adoption of SFAS No. 152, our financial statements for periods beginning on or after January 1, 2006, are not comparable, in certain respects, with those prepared for periods ended prior to January 1, 2006.

Many sellers of timeshare interests, including us, provide incentives to customers in connection with the purchase of a VOI. Under SFAS No. 152, the value of certain incentives and other similarly treated items are either recorded as a reduction to VOI revenue or recorded in a separate revenue line item within the statements of income, in our case other resort and communities operations revenue. Furthermore, SFAS No. 152 requires that certain incentives and other similarly treated items such as cash credits earned through our Sampler Program be considered in calculating the buyer’s down payment toward the buyer’s commitment, as defined in SFAS No. 152, in purchasing the VOI. Our Sampler Program provides purchasers with an opportunity to utilize our VOI product during a one year trial period. In the event the Sampler package purchaser subsequently purchases a VOI interest from us, a portion of the amount paid for their Sampler Package is credited toward the down payment on the subsequent purchase. Under SFAS No. 152, the credit given is treated similarly to a sales incentive. If after considering the sales incentive the required buyer’s commitment amount, defined as 10% of sales value, is not met, the VOI revenue and related cost of sales and direct selling costs are deferred until the buyer’s commitment test is satisfied, generally through the receipt of required mortgage note payments from the buyer. The net deferred VOI revenue and related costs are recorded as a component of deferred income in the accompanying balance sheets as of December 31, 2006 and 2007. Prior to the adoption of

SFAS No. 152, sales incentives were not recorded apart from VOI revenue and were not considered in determining the customer down payment required in the buyer’s commitment in purchasing the VOIs.

SFAS No. 152 also amends the relative sales value method of recording VOI cost of sales. Specifically, consideration is now given not only to the costs to build or acquire a project and the total revenue expected to be earned on a project, but also to the sales of recovered VOI interests reacquired on future cancelled or defaulted sales. The cost of VOI sales is calculated by estimating these future costs and recoveries. Prior to the adoption of SFAS No. 152, we did not include the recovery of VOIs in our projected revenues in determining the related cost of the VOIs sold.

SFAS No. 152 changes the treatment of losses on VOI notes and contracts receivable and provides specific guidance on methods to estimate losses. Specifically, SFAS No. 152 requires that the estimated losses on originated mortgages exclude an estimate for the value of recoveries as the recoveries are to be considered in inventory costing, as described above. In addition, the standard requires a change in the classification of our provision for loan losses for VOI receivables that were historically recorded as an expense, requiring that such amount be reflected as a reduction of VOI sales. Furthermore, if we sell our VOI notes receivables in a transaction that qualifies for off-balance sheet sales treatment under SFAS No. 140, the associated allowance for loan losses related to the sold receivables is reversed and reflected as an increase to VOI sales. Prior to the adoption of SFAS No. 152, the reversal of the allowance on sold receivables was recorded as a component of the gain on sale.

Under SFAS No.152, rental operations, including the usage of our Sampler Program, are accounted for as incidental operations whereby incremental costs in excess of incremental revenue are charged to expense as incurred. Conversely, incremental revenue in excess of incremental costs is recorded as a reduction to VOI inventory. Incremental costs include costs that have been incurred by us during the holding period of the unsold VOIs, such as developer subsidies and maintenance fees. During 2006 and 2007, all of our rental revenue and Sampler revenue recognized was recorded as an off-set to cost of other resort and communities operations revenue as such amounts were less than the incremental cost. Prior to the adoption of SFAS No. 152, rental revenues were separately presented in the consolidated statements of income as a component of other resort and communities operations revenue and a portion of Sampler proceeds was deferred until the buyer purchased a VOI or the Sampler usage period expired.

The adoption of SFAS No. 152 on January 1, 2006, resulted in a net charge of $4.5 million, which is presented as a cumulative effect of change in accounting principle, net of the related tax benefit and the charge related to minority interest.

3. Joint Venture

On June 16, 2000, one of our wholly-owned subsidiaries entered into an agreement with Big Cedar LLC (“Big Cedar”), an affiliate of Bass Pro, Inc. (“Bass Pro”), to form the Joint Venture, a vacation ownership development, marketing and sales limited liability company. We have a 51% ownership interest in the Joint Venture, while Big Cedar owns 49%. Under the terms of the original agreement, the Joint Venture was developing, marketing and selling VOIs at The Bluegreen Wilderness Club at Big Cedar, a 324-unit, wilderness-themed resort adjacent to the Big Cedar Lodge, a luxury hotel resort owned by Big Cedar, on the shores of Table Rock Lake in Ridgedale, Missouri. In December 2007, the agreement was amended to include the development, marketing, and selling of timeshare interests in additional property purchased by the Joint Venture in September 2007. The agreement, as amended, also requires that the Joint Venture pay Big Cedar a fee on sales of newly developed timeshare interests for promotional, marketing, and advertising services.

In addition to its 51% ownership interest, we also receive a quarterly management fee from the Joint Venture equal to 3% of the Joint Venture’s net sales in exchange for our involvement in the day-to-day operations of the Joint Venture. We also service the Joint Venture’s notes receivable in exchange for a servicing fee.

Based on our role as the day-to-day manager of the Joint Venture, its majority control of the Joint Venture’s Management Committee and our controlling financial interest in the Joint Venture, the accounts of the Joint Venture are consolidated in our financial statements.

Because the Joint Venture has a finite life (i.e., the Joint Venture can only exist through the earlier of: i) December 31, 2057; ii) the sale or disposition of all or substantially all of the assets of the Joint Venture; iii) a decision to dissolve the Joint Venture by us and Big Cedar; or iv) certain other events described in the Joint Venture agreement), the minority interest in the Joint Venture meets the definition of a mandatorily redeemable non-controlling interest as specified in SFAS No. 150, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity . The settlement value of this mandatorily redeemable non-controlling interest at December 31, 2006 and 2007 was $15.2

million and $22.9 million, respectively, based on the sale or disposition of all or substantially all of the assets of the Joint Venture as of those respective dates.

During the years ended December 31, 2005, 2006, and 2007, the Joint Venture paid approximately $0.6 million, $0.5 million, and $0.1 million, respectively, to Bass Pro and affiliates for construction management services and furniture and fixtures in connection with the development of the Joint Venture’s vacation ownership resort and sales office. In addition, the Joint Venture paid Big Cedar and affiliates approximately $2.0 million, $2.9 million, and $2.1 million for gift certificates and hotel lodging during the year ended December 31, 2005, 2006, and 2007, respectively, in connection with the Joint Venture’s marketing activities.

4. Marketing Agreement

On June 16, 2000, we entered into an exclusive, 10-year marketing agreement with Bass Pro, a privately-held retailer of fishing, marine, hunting, camping and sports gear. Bass Pro is an affiliate of Big Cedar (see Note 3). Pursuant to the agreement, we have the right to market our VOIs at each of Bass Pro’s national retail locations (we were in 45 of Bass Pro’s stores as of December 31, 2007), in Bass Pro’s catalogs and on its web site. We also have access to Bass Pro’s customer lists. In exchange for these services, we compensate Bass Pro based on the overall success of the marketing activities. The amount of compensation is dependent on the level of additional marketing efforts required by us to convert the prospect into a sale and a defined time frame for such marketing efforts. No compensation was paid to Bass Pro on sales made by the Joint Venture. In 2005, 2006, and 2007, we recognized marketing compensation expense to Bass Pro of approximately $5.2 million, $6.4 million, and $6.6 million, respectively. In December 2007, the marketing agreement was amended to extend through January 1, 2015 and also requires us to make a non-interest bearing annual prepayment to Big Cedar on or before January 1 each year, which operates as an advance payment for anticipated commissions to be earned in the upcoming year. The annual prepayment will be equal to 100% of the estimated amount of commissions generated during the upcoming year, as determined by the us and Big Cedar, not to exceed $5,000,000. No additional commissions will be paid to Big Cedar during any year, until the annual prepayment for that year has been fully earned.

On June 16, 2000, we prepaid $9.0 million to Bass Pro (the “2000 Prepayment”). The Prepayment was fully amortized from compensation earned by Bass Pro and distributions otherwise payable to Big Cedar from the earnings of the Joint Venture as a member thereof through December 31, 2005. Additional compensation and member distributions will be paid in cash to Bass Pro or Big Cedar. During 2006, the Joint Venture made a member distribution of $1.9 million. Of the 2005 distribution, $1.3 million was payable to Big Cedar and used to pay down the balance of the Prepayment. As of December 31, 2005, the 2000 Prepayment was fully amortized.

In December 2007 and simultaneous with entering into the amended joint venture agreement, described above Note 3, we extended our marketing arrangement through January 1, 2015 with Bass Pro, a privately-held retailer of fishing, marine, hunting, camping and sports gear, and certain Bass Pro affiliates including Big Cedar, by entering into an Amended and Restated Marketing and Promotions Agreement (“Amended M&P Agreement”). Pursuant to the Amended M&P Agreement, we will continue to have the right to market our timeshare interests at each of Bass Pro’s retail locations, in Bass Pro’s catalogs and on its website, as well as through other marketing channels. In exchange for access to these marketing channels, we will pay Big Cedar (on behalf of itself and its affiliates) a commission on sales of our timeshare interests made to purchasers generated from the Bass Pro/Big Cedar marketing channels described above. There is no commission paid by on sales made by the Joint Venture or on sales of Joint Venture timeshare interests.

During the years ended December 31, 2005, 2006, and 2007, we paid affiliates of Bass Pro approximately $89,000, $2.1 million, and $3.3 million, respectively, for various services including tour costs, premiums and lead generation, as well as $4.0 million during 2007 for prepaid commissions to be earned by Big Cedar in 2008 under the amended marketing agreement described above.

5. Notes Receivable

The table below sets forth additional information relative to our notes receivable (in thousands).


	As of December 31,

	2006			2007

Notes receivable secured by VOIs	$	150,649		$	172,787
Notes receivable secured by homesites		6,915			5,336
Other notes receivable		186			—

Notes receivable, gross		157,750			178,123
Allowance for loan losses		(13,499	)		(17,458	)

Notes receivable, net	$	144,251		$	160,665

The weighted-average interest rate on our notes receivable was 14.2% and 13.8% at December 31, 2006 and 2007, respectively. All of our VOI loans bear interest at fixed rates. The weighted average interest rate charged on loans secured by VOIs was 14.3% and 13.9% at December 31, 2006 and 2007, respectively. Approximately 79% of our notes receivable secured by homesites bear interest at variable rates, while the balance bears interest at fixed rates. The weighted average interest rate charged on loans secured by homesites was 11.9% and 12.1% at December 31, 2006 and 2007, respectively.

Our vacation ownership loans are generally secured by property located in Florida, Michigan, Missouri, Pennsylvania, South Carolina, Tennessee, Virginia, Wisconsin and Aruba. The majority of Bluegreen Communities’ notes receivable are secured by homesites in Georgia, Texas and Virginia.

The table below sets forth the activity in our allowance for uncollectible notes receivable for 2006 and 2007 (in thousands):


	Year Ended December 31,

	2006			2007

Balance, beginning of year	$	10,869		$	13,499
Adjustment for cumulative effect of change in accounting principle		1,164			—
Provision for loan losses		59,489			65,419

Less: Allowance on sold receivables		(38,848	)		(42,750	)

Less: Write-offs of uncollectible receivables		(19,175	)		(18,710	)

Balance, end of year	$	13,499		$	17,458

Installments due on our notes receivable during each of the five years subsequent to December 31, 2006, and 2007, and thereafter are set forth below (in thousands):


	2006		2007

Due in 1 year	$	28,912	$	39,838
Due in 2 years		10,280		10,761
Due in 3 years		11,008		11,953
Due in 4 years		12,079		13,662
Due in 5 years		13,693		15,412
Thereafter		81,778		86,497

Total	$	157,750	$	178,123

The following table summarizes our allowance for loan losses by division as of December 31, 2006 and 2007:


	Bluegreen Resorts				Bluegreen Communities				Other			Total


December 31, 2006:
Notes receivable		$	150,649			$	6,915		$	186		$	157,750
Allowance for loan losses			(13,140	)			(173	)		(186	)		(13,499	)

Notes receivable, net		$	137,509			$	6,742		$	—		$	144,251

Allowance as a % of gross notes receivable			9	%			3	%		100	%		9	%

December 31, 2007:
Notes receivable		$	172,787			$	5,336		$	—		$	178,123
Allowance for loan losses			(17,196	)			(262	)		—			(17,458	)

Notes receivable, net		$	155,591			$	5,074		$	—		$	160,665

Allowance as a % of gross notes receivable			10	%			5	%		0	%		10	%

6. Sales of Notes Receivable

Sales of notes receivable during the years ended December 31, 2005, 2006, and 2007 were as follows (in millions):


Year Ended December 31, 2005:
Facility	Aggregate Principal Balance of Notes Receivable Sold			Purchase Price			Gain Recognized			Initial Fair Value of Retained Interest

2004 BB&T Purchase Facility		$	211.9		$	180.1		$	25.0		$	42.4
2005 Term Securitization			16.7			15.1			0.2			3.0

Total		$	228.6		$	195.2		$	25.2		$	45.4


Year Ended December 31, 2006:
Facility	Aggregate Principal Balance of Notes Receivable Sold			Purchase Price			Gain Recognized			Initial Fair Value of Retained Interest

2005 Term Securitization		$	18.6		$	16.7		$	4.6		$	3.8
2006-A GE Purchase Facility			72.0			64.8			11.1			8.5
2006 Term Securitization			153.0			137.0			29.0			29.6

Total		$	243.6		$	218.5		$	44.7		$	41.9


Year Ended December 31, 2007:
Facility	Aggregate Principal Balance of Notes Receivable Sold			Purchase Price			Gain Recognized			Initial Fair Value of Retained Interest

2006-A GE Purchase Facility		$	66.9		$	60.2		$	10.6		$	8.3
2007 Term Securitization			200.0			168.9			28.8			36.3

Total		$	266.9		$	229.1		$	39.4		$	44.6

As a result of adopting SFAS No. 152 during the year ended December 31, 2006, approximately $38.8 million of the gain was recorded as a component of sales of real estate on the accompanying Statements of Income for the year ended December 31, 2006; with the remaining gain of $5.9 million reflected in the sales of notes receivable line item on the accompanying statements of income. During the year ended December 31, 2007, approximately $42.8 million of the gain was recorded as a component of sales of real estate on the accompanying Statements of Income for the year ended December 31, 2007; with the offsetting amount of $3.4 million reflected in the sales of notes receivable line item on the accompanying statements of income.

The following assumptions were used to measure the initial fair value of the retained interest in notes receivable sold or securitized for each of the periods listed below:


	For the year ended December 31,

	2005		2006		2007


Prepayment rates	17% - 9	%	17% - 9	%	29% - 11	%
Loss severity rates	35% - 45	%	35% - 71	%	38% - 72	%
Default rates	10% - 1	%	11% - 1	%	12% - 1	%
Discount rates	9% - 12	%	9%		9% - 12.6	%

The following is a description of the facilities that were used to sell notes receivable that qualified for sale recognition under the provisions of SFAS 140.

2004 BB&T Purchase Facility

On December 31, 2004, we executed agreements for a vacation ownership receivables purchase facility (the “2004 BB&T Purchase Facility”) with Branch Banking and Trust Company (“BB&T”). The 2004 BB&T Purchase Facility utilized an owner’s trust structure, pursuant to which we sold receivables to Bluegreen Receivables Finance Corporation IX, our wholly-owned, special purpose finance subsidiary (“BRFC IX”), and BRFC IX sold the receivables to an owner’s trust (a qualified special purpose entity) without recourse to us or BRFC IX except for breaches of certain customary representations and warranties at the time of sale. We did not enter into any guarantees in connection with the 2004 BB&T Purchase Facility. The 2004 BB&T Purchase Facility had detailed requirements with respect to the eligibility of receivables for purchase and fundings under the BB&T Purchase Facility were subject to certain conditions precedent. Under the 2004 BB&T Purchase Facility, a variable purchase price of approximately 85.0% of the principal balance of the receivables sold, subject to certain terms and conditions, was paid at closing in cash. The balance of the purchase price was deferred until such time as BB&T had received a specified return and all servicing, custodial, agent and similar fees and expenses had been paid. The specified return was equal to the commercial paper rate or London Interbank Offered Rate (“LIBOR”), as applicable, plus an additional return of 1.15%, subject to use of alternate return rates in certain circumstances. In addition, we paid BB&T structuring and other fees totaling $1.1 million in December 2004, which was expensed over the funding period of the 2004 BB&T Purchase Facility. We acted as servicer under the 2004 BB&T Purchase Facility for a fee. The BB&T Purchase Facility expired on December 30, 2005.

2005 Term Securitization

On December 28, 2005, BB&T Capital Markets, a division of Scott & Stringfellow, Inc., served as initial purchaser and placement agent for a $203.8 million private offering and sale of vacation ownership receivable-backed securities (the

“2005 Term Securitization”). The $191.1 million in aggregate principal of vacation ownership receivables offered and sold in the 2005 Term Securitization were previously sold to BRFC IX. The proceeds of the 2005 Term Securitization were used to pay BB&T all amounts outstanding under the 2004 BB&T Purchase Facility, pay fees associated with the transaction to third-parties, deposit initial amounts in a required cash reserve account and the escrow accounts for the Pre-funded Receivables (see below) and provide net cash proceeds of $1.1 million to us.

In addition, the 2005 Term Securitization allowed for an additional $35.3 million in aggregate principal of our qualifying vacation ownership receivables (the “2005 Pre-funded Receivables”) that could be sold by us through March 28, 2006. The proceeds of $31.8 million (at an advance rate of 90%) as payment for the 2005 Pre-funded Receivables were deposited into an escrow account by the Indenture Trustee of the 2005 Term Securitization until such receivables were actually sold by us to BRFC X. During 2005, we sold $16.7 million in 2005 Pre-funded Receivables to BRFC X and the $15.1 million purchase price was disbursed to us from the escrow account. During 2006, we sold the remaining $18.6 million in pre-funded receivables to BRFC X and the $16.7 million purchase price was disbursed to us from the escrow account.

2006 GE Purchase Facility

In March 2006, we executed agreements for a VOI receivables purchase facility (the “2006 GE Purchase Facility”) with General Electric Real Estate (“GE”). The GE Purchase Facility utilizes an owner’s trust structure, pursuant to which we sell receivables to Bluegreen Receivables Finance Corporation XI, our wholly-owned, special purpose finance subsidiary (“BRFC XI”), and BRFC XI sells the receivables to an owner’s trust (a qualified special purpose entity) without recourse to us or BRFC XI except for breaches of certain customary representations and warranties at the time of sale. We did not enter into any guarantees in connection with the 2006 GE Purchase Facility. The GE Purchase Facility has detailed requirements with respect to the eligibility of receivables for purchase, and fundings under the GE Purchase Facility are subject to certain conditions precedent. Under the 2006 GE Purchase Facility, a variable purchase price of approximately 90% of the principal balance of the receivables sold, subject to adjustment under certain terms and conditions, was paid at closing in cash. The balance of the purchase price is deferred until such time as GE has received a specified return, a specified overcollateralization ratio is achieved, a cash reserve account is fully funded and all servicing, custodial, agent and similar fees and expenses have been paid. GE is entitled to receive a return equal to the applicable Swap Rate (which is essentially a published interest swap arrangement rate as defined in the 2006 GE Purchase Facility agreements) plus 2.35%, subject to use of alternate return rates in certain circumstances. In addition, we paid GE a structuring fee of approximately $437,500 in March 2006. Subject to the terms of the agreements, we act as servicer under the 2006 GE Purchase Facility for a fee.

The 2006 GE Purchase Facility allowed for transfers of notes receivable for a cumulative purchase price of up to $125.0 million through March 2008. During 2006, the Company transferred $72.0 million in VOI receivables for an aggregate purchase price of $64.8 million under the 2006 GE Purchase Facility. During 2007, the Company transferred $66.9 million in VOI receivables for an aggregate purchase price of $60.2 million under the GE Purchase Facility, which fully utilized the 2006 GE Purchase Facility.

2006 Term Securitization

In September 2006, BB&T Capital Markets, a division of Scott & Stringfellow, Inc., served as initial purchaser and placement agent for a private offering and sale of $139.2 million of our VOI receivable-backed securities (the “2006 Term Securitization”). Approximately $153.0 million in aggregate principal of VOI receivables were securitized in this transaction, including: (1) $75.7 million in aggregate principal of receivables that were previously transferred under an existing VOI receivables purchase facility in which BB&T serves as Agent (see 2006 BB&T Purchase Facility below in Footnote 10); (2) $38.0 million of VOI receivables owned by us immediately prior to the 2006 Term Securitization and 3) an additional $39.3 million in aggregate principal of our qualifying VOI receivables (the “2006 Pre-funded Receivables”) that could be sold by us through December 22, 2006. The expected proceeds of $35.7 million (at an advance rate of 91%) as payment for the 2006 Pre-funded Receivables were originally deposited into an escrow account by the indenture trustee of the 2006 Term Securitization. During 2006, we sold $39.3 million in 2006 Pre-funded Receivables to BRFC XII and the $35.7 million purchase price was disbursed to us from the escrow account. The proceeds were used by us for general operating purposes.

2007 Term Securitization

In September 2007, BB&T Capital Markets, a division of Scott & Stringfellow, Inc. served as initial purchaser and placement agent for a private offering and sale of $177.0 million of VOI receivable-backed securities (the “2007 Term Securitization”). Approximately $200.0 million in aggregate principal of VOI receivables were securitized and sold in

this transaction, including: (1) $115.5 million in aggregate principal of VOI receivables that were previously transferred under the 2006 BB&T Purchase Facility (see Note 10); (2) $35.8 million of VOI receivables owned by the Company immediately prior to the 2007 Term Securitization; and, (3) an additional $48.7 million in aggregate principal of the Company’s qualifying VOI receivables that could be sold by us through December 28, 2007 (the “2007 Pre-funded Receivables”). The purchase price for the 2007 Pre-Funded Receivables was deposited into an escrow account. During 2007, we sold $48.7 million in 2007 Pre-funded Receivables, and the $43.1 million purchase price was disbursed to us from the escrow account.


7.	Retained Interests in Notes Receivable Sold

Our retained interests in notes receivable sold, which are classified as available-for-sale investments, and their associated unrealized gains are set forth below (in thousands).


As of December 31, 2006:	Amortized Cost			Gross Unrealized Gain			Fair Value

2002 Term Securitization		$	12,643		$	472		$	13,115
2004 Term Securitization (see Note 6)			17,784			2,785			20,569
2004 GE Purchase Facility (see Note 6)			6,695			56			6,751
2005 Term Securitization (see Note 6)			42,469			8,291			50,760
2006 GE Purchase Facility (see Note 6)			7,405			1,264			8,669
2006 Term Securitization (see Note 6)			23,253			7,506			30,759

Total		$	110,249		$	20,374		$	130,623

As of December 31, 2007:

Amortized
Cost

Gross
Unrealized
Gain (Loss)

Fair Value

2002 Term Securitization

8,842

—

8,842

2004 Term Securitization (see Note 6)

11,934

2,797

14,731

2004 GE Purchase Facility (see Note 6)

5,633

(609

)

5,024

2005 Term Securitization (see Note 6)

29,268

2,230

31,498

2006 GE Purchase Facility (see Note 6)

15,481

953

16,434

2006 Term Securitization (see Note 6)

24,522

1,529

26,051

2007 Term Securitization (see Note 6)

30,000

8,919

38,919

Total

125,680

15,819

141,499

The contractual maturities of our retained interest in notes receivable sold as of December 31, 2007, based on the final maturity dates of the underlying notes receivable are as follows:


	Amortized Cost		Fair Value


After one year but within five	$	8,842	$	8,842
After five years but within ten		116,838		132,657

Total	$	125,680	$	141,499

The following assumptions were used to measure the fair value of the above retained interests as of December 31, 2006 and 2007:


	As of December 31,

	2006		2007


Prepayment rates		27% - 6%		33% - 6%
Loss severity rates		30% - 71%		18% - 72%
Default rates		11% - 1%		12% - 0%
Discount rates		8% - 9%		12.6%

The following table shows the hypothetical fair value of our retained interests in notes receivable sold based on a 10% and a 20% adverse change in each of the assumptions used to measure the fair value of those retained interests (dollars in thousands):


			Hypothetical Fair Value at December 31, 2007

	Adverse Change Percentage		2002 Term Securitization			2004 Term Securitization			2004 GE Purchase Facility		2005 Term Securitization			2006 GE Purchase Facility		2006 Term Securitization			2007 Term Securitization

Prepayment rate:	10	%		$	8,776		$	14,433	$	5,006		$	31,005	$	16,286		$	25,601		$	38,424
	20	%			8,712			14,146		4,988			30,537		16,146			25,180			37,963

Loss severity rate:	10	%			8,775			14,635		4,857			30,760		15,467			25,460			37,940
	20	%			8,709			14,538		4,689			30,022		14,502			24,868			36,961

Default rate:	10	%			8,762			14,587		4,822			30,724		15,295			25,382			37,662
	20	%			8,683			14,444		4,624			29,961		14,186			24,723			36,430

Discount rate:	10	%			8,386			14,405		4,869			30,857		15,804			25,541			37,893
	20	%			7,954			14,093		4,722			30,246		15,211			25,054			36,916

The table below summarizes certain cash flows received from and (paid to) our qualifying special purpose finance subsidiaries (in thousands):


	For the Year Ended December 31,

	2005			2006			2007


Proceeds from new sales of receivables	$	198,260		$	218,455		$	229,067
Collections on previously sold receivables		(104,863	)		(145,096	)		(173,448	)
Servicing fees received		4,969			6,955			8,697
Purchases of defaulted receivables		(631	)		(1,122	)		(3,420	)
Resales of foreclosed assets		(30,573	)		(40,566	)		(44,786	)
Remarketing fees received		16,793			23,163			25,858
Cash received on retained interests in notes receivable sold		11,016			30,032			35,949
Cash paid to fund required reserve accounts		(6,445	)		(13,495	)		(10,044	)
Purchases of upgraded accounts		(2,443	)		(17,447	)		(28,251	)

Quantitative information about the portfolios of VOI notes receivable previously sold without recourse in which we hold the above retained interests is as follows (in thousands):


	As of December 31, 2007						Year Ended December 31, 2007

	Total Principal Amount of Loans			Principal Amount of Loans 60 or More Days Past Due			Credit Losses, Net of Recoveries

2002 Term Securitization		$	29,638		$	767		$	584
2004 Term Securitization			55,880			1,409			2,463
2004 GE Purchase Facility			20,941			708			706
2005 Term Securitization			131,711			3,826			6,113
2006 GE Purchase Facility			105,680			2,679			—
2006 Term Securitization			112,700			3,771			3,557
2007 Term Securitization			188,185			3,865			—

The net unrealized gain on our retained interests in notes receivable sold, which is presented as a separate component of our shareholders’ equity net of income taxes, was approximately $12.6 million and $9.8 million as of December 31, 2006 and 2007, respectively.

During the years ended December 31, 2005 and 2006, we recorded an other-than-temporary decrease of approximately $539,000 and $39,000 respectively, in the fair value of one of our VOI receivable transactions, based primarily on

higher than projected defaults. In 2007, we recorded an other-than-temporary decrease in the fair value of two of our VOI receivable transactions totaling approximately $2.4 million, based primarily on an increase in the discount rates used to value our retained interest in notes receivable sold. These charges have been netted against interest income on our consolidated statements of income.


8.	Inventory

Our net inventory holdings, summarized by division, are set forth below (in thousands).


	As of December 31,

	2006		2007


Bluegreen Resorts	$	233,290	$	288,969
Bluegreen Communities		116,043		145,999

	$	349,333	$	434,968

Bluegreen Resorts inventory as of December 31, 2006 consisted of land inventory of $46.6 million, $85.4 million of construction-in-progress and $101.3 million of completed VOI units. Bluegreen Resorts inventory as of December 31, 2007, consisted of land inventory of $75.3 million, $121.1 million of construction-in-progress and $92.6 million of completed VOI units.

Interest capitalized to inventory during the years ended December 31, 2005, 2006, and 2007 totaled $10.0 million, $12.1 million, and $15.5 million, respectively. The interest expense reflected in our consolidated statements of income is net of capitalized interest.


9.	Property and Equipment

The table below sets forth the property and equipment held by us (in thousands).


		December 31,

	Useful Life	2006			2007


Office equipment, furniture and fixtures	3-14 years	$	58,795		$	67,894
Golf course land, land improvements, buildings and equipment	5-39 years		33,684			32,462
Land, buildings and building improvements	3-31 years		35,254			42,694
Leasehold improvements	2-14 years		16,846			15,663
Transportation and equipment	3-5 years		2,459			2,435

			147,038			161,148
Accumulated depreciation and amortization of leasehold improvements			(54,593	)		(66,727	)

Total		$	92,445		$	94,421


10.	Receivable-Backed Notes Payable

The table below sets forth the balances of our receivable-back notes payable facilities (in thousands).


	December 31,

	2006		2007


2006 BB&T Purchase Facility	$	—	$	16,967
GMAC Receivable Facility		16,870		11,400
GE Bluegreen/Big Cedar Receivables Facility		—		24,100
Textron Facility		2,180		1,482
Foothill Facility		1,983		1,050
Other		17		—

Total	$	21,050	$	54,999

reflected as liabilities on our balance sheet. The 2006 BB&T Purchase Facility utilizes an owner’s trust structure, pursuant to which we transfer receivables to Bluegreen Timeshare Finance Corporation I, our wholly-owned, special purpose finance subsidiary (“BTFC I”), and BTFC I subsequently transfers the receivables to an owner’s trust without recourse to us or BTFC I, except for breaches of certain customary representations and warranties at the time of transfer. We did not enter into any guarantees in connection with the BB&T Purchase Facility. The 2006 BB&T Purchase Facility has detailed requirements with respect to the eligibility of receivables, and fundings under the BB&T Purchase Facility are subject to certain conditions precedent. Under the 2006 BB&T Purchase Facility, as amended, a variable purchase price of approximately 83% of the principal balance of the receivables transferred, subject to certain terms and conditions, is paid at closing in cash. The balance of the purchase price is deferred until such time as BB&T and other liquidity providers arranged by BB&T have in aggregate received a specified return (the “Specified Return”) and all servicing, custodial, agent and similar fees and expenses have been paid. The Specified Return is equal to either the commercial paper rate or LIBOR rate plus 1.25%, subject to use of alternate return rates in certain circumstances. We act as servicer under the 2006 BB&T purchase facilities for a fee. The BB&T Purchase Facility allows for transfers of notes receivable for a cumulative purchase price of up to $137.5 million, on a revolving basis, through May 2008.

During the year ended December 31, 2007, we transferred $143.3 million of VOI notes receivable to the 2006 BB&T Purchase Facility and received $121.4 million in cash proceeds. In connection with the 2007 Term Securitization (see Note 6) all amounts outstanding on the 2006 BB&T Purchase Facility as of September 2007 were repaid. In December 2007, we transferred $20.4 million of VOI notes receivable to the 2006 BB&T Purchase Facility and received $17.0 million in cash proceeds. The remaining availability under the 2006 BB&T Purchase Facility, subject to the terms and conditions of the facility, was $120.5 million. As of December 31, 2007, the outstanding balance bore interest at 5.85%. During 2006, we borrowed $68.4 million under the 2006 BB&T Purchase Facility.

The GMAC Receivables Facility . In February 2003, we entered into a revolving VOI receivables credit facility (the “GMAC Receivables Facility”) with Residential Funding Corporation (“RFC”), an affiliate of GMAC. The GMAC Receivables Facility has detailed requirements with respect to the eligibility of receivables for inclusion and other conditions to funding. The borrowing base under the GMAC Receivables Facility is 90% of the outstanding principal balance of eligible notes arising from the sale of VOIs. The GMAC Receivables Facility includes affirmative, negative and financial covenants and events of default. All principal and interest payments received on pledged receivables are applied to principal and interest due under the GMAC Receivables Facility. Interest payments are due monthly. During the years ended December 31, 2006 and 2007, we did not pledge any VOI receivables under the GMAC Receivables Facility. As of December 31, 2007, the outstanding balance bore interest at 8.60%. In February 2008, the advance period on the GMAC Receivables Facility expired. All amounts outstanding under the GMAC Receivables Facility are due on February 15, 2015.

GE Bluegreen/Big Cedar Receivables Facility . During April 2007, the Bluegreen/Big Cedar Joint Venture entered into a $45.0 million revolving VOI receivables credit facility (the “GE Bluegreen/Big Cedar Receivables Facility”) with GE. Bluegreen Corporation has guaranteed the full payment and performance of the Bluegreen/Big Cedar Joint Venture in connection with the Facility. The GE Bluegreen/Big Cedar Receivables Facility allows for advances on a revolving basis through April 16, 2009. All outstanding borrowings on the GE Bluegreen/Big Cedar Receivables Facility mature no later than April 16, 2016. The GE Bluegreen/Big Cedar Receivables Facility has detailed requirements with respect to the eligibility of receivables for inclusion and other conditions to funding. The borrowing base under the GE Bluegreen/Big Cedar Receivables Facility ranges from 97% - 90% (based on the spread between the weighted average note receivable coupon and GE’s interest rate) of the outstanding principal balance of eligible notes receivable arising from the sale of VOIs. The GE Bluegreen/Big Cedar Receivables Facility includes affirmative, negative and financial covenants and events of default. All principal and interest payments received on pledged receivables are applied to principal and interest due under the GE Bluegreen/Big Cedar Receivables Facility. Indebtedness under the GE Bluegreen/Big Cedar Receivables Facility bears interest adjusted monthly at the one month LIBOR plus 1.75%. The Bluegreen/Big Cedar Joint Venture was required to pay an upfront loan commitment fee of $225,000 in connection with the Facility. During 2007 the Bluegreen/Big Cedar Joint Venture pledged $32.0 million in aggregate principal balance of notes receivable under the facility and received $30.8 million in cash proceeds, net of issuance costs. As of December 31, 2007, the outstanding balance bore interest at 6.35%, and the remaining availability under the GE Bluegreen/Big Cedar Receivables Facility, subject to the terms and conditions of this facility, was $20.9 million.

The Textron Facility. During December 2003, we signed a combination $30.0 million Acquisition and Development and Timeshare Receivables facility with Textron Financial Corporation (the “Textron Facility”). The borrowing period for acquisition and development loans under the Textron Facility expired on October 1, 2004. The borrowing period for VOI receivables loans under the Textron Facility expired on March 1, 2006, and outstanding VOI receivables borrowings mature no later than March 31, 2009. Receivable-backed borrowings under the Textron Facility bear interest at the prime lending rate plus 1.00% (8.25% at December 31, 2007), subject to a 6.00% minimum interest rate.

The Foothill Facility. The Foothill Facility is secured by the pledge of Bluegreen Communities’ receivables, inventory, and for the pledge of Bluegreen Resorts’ receivables and requires principal payments based on agreed-upon release prices as homesites in the encumbered communities are sold and bears interest at the prime lending rate plus 1.25% (8.5% at December 31, 2007). Interest payments are due monthly. The interest rate charged on outstanding receivable borrowings under the Foothill Facility is the prime lending rate plus 0.25% (7.5% at December 31, 2007) when the average monthly outstanding loan balance is greater than or equal to $15.0 million. If the average monthly outstanding loan balance is less than $15.0 million, the interest rate is the greater of 4.00% or the prime lending rate plus 0.50% (7.75% at December 31, 2007). All principal and interest payments received on pledged receivables are applied to principal and interest due under the Foothill Facility. At December 31, 2007, approximately $711,000 of the outstanding balance relates to Bluegreen Communities’ receivables borrowings and approximately $339,000 relates to Bluegreen Resorts’ receivables borrowings. Outstanding indebtedness collateralized by receivables is due December 31, 2008. As of December 31, 2007, the outstanding balance bore interest at 7.75%.


11.	Lines-of-Credit and Notes Payable

We have outstanding borrowings with various financial institutions and other lenders, which have been used to finance the acquisition and development of our inventory and to fund operations. Financial data related to our borrowing facilities is set forth below (in thousands).


	December 31, 2006			December 31, 2007

Lines-of-credit secured by inventory and golf courses with a carrying value of $251 million at December 31, 2007. Interest rates range from 9.25% to 9.83% at December 31, 2006 and 8.25% to 9.10% at December 31, 2007. Maturities range from September 2009 to November 2011		$	90,974		$	148,080

Notes and mortgage notes secured by certain inventory, property, equipment and investments with an aggregate carrying value of $51 million at December 31, 2007. Interest rates ranged from 4.75% to 9.50% at December 31, 2006 to 6.05% to 8.50% at December 31, 2007. Maturities range from February 2008 to May 2026			32,736			28,501

Lease obligations secured by the underlying assets with an aggregate carrying value of $0.4 million at December 31, 2007. Imputed interest rates ranging from 3.29% to 14.20% at December 31, 2006 and from 3.29% to 9.92% at December 31, 2007. Maturities range from February 2008 to November 2011			702			397

Total		$	124,412		$	176,978

The table below sets forth the contractual minimum principal payments required on our lines-of-credit and notes payable and capital lease obligations for each year subsequent to December 31, 2007. Such minimum contractual payments may differ from actual payments due to the effect of principal payments required on a homesite or VOI release basis for certain of the above obligations (in thousands).


2008	$	7,442
2009		121,141
2010		28,851
2011		16,024
2012		307
Thereafter		3,213

Total	$	176,978

The following is a discussion of our significant credit facilities and significant new borrowings during the year ended December 31, 2007:

The GMAC AD&C Facility. In February 2003, RFC also provided us with an acquisition, development and construction revolving credit facility for Bluegreen Resorts (the “GMAC AD&C Facility”). The period during which individual projects can be added to the GMAC AD&C Facility, as amended, expires on February 15, 2008, but borrowings on approved projects can be made, subject to the terms and conditions of individual project commitments on dates from July 2008 through June 2009, with outstanding borrowings maturing on dates ranging from September 2010 through November 2011. Principal will be repaid through agreed-upon release prices as VOIs are sold at the financed resorts, subject to minimum required amortization. Interest payments are due monthly. During the year ended December 31, 2007, we borrowed $81.4 million under the GMAC AD&C Facility in the aggregate on our Fountains (Orlando), and

Las Vegas resorts as well as the acquisition of a 27.5 acre property located on Table Rock Lake located in Ridgedale, Missouri. As of December 31, 2007, the outstanding balance bore interest at 9.10%.

The GMAC Communities Facility. We have a revolving credit facility with RFC (the “GMAC Communities Facility”) for the purpose of financing our Bluegreen Communities real estate acquisitions and development activities. The GMAC Communities Facility is secured by the real property homesites (and personal property related thereto) at the following Bluegreen Communities projects, as well as any Bluegreen Communities projects acquired by us with funds borrowed under the GMAC Communities Facility (the “Secured Projects”): Catawba Falls Preserve (Black Mountain, North Carolina); Lake Ridge at Joe Pool Lake (Cedar Hill and Grand Prairie, Texas); Mystic Shores at Canyon Lake (Spring Branch, Texas); Havenwood at Hunter’s Crossing (New Braunfels, Texas); The Bridges at Preston Crossings (Grayson County, Texas); King Oaks (College Station, Texas); Vintage Oaks at the Vineyard (New Braunfels, Texas); and Sanctuary River Club at St. Andrews Sound (St. Simons Island, Georgia). In addition, the GMAC Communities Facility is secured by our Carolina National and the Preserve at Jordan Lake golf courses in Southport, North Carolina and Chapel Hill, North Carolina, respectively. The period during which we can add additional projects to the GMAC Communities Facility has expired although we can continue to borrow on projects approved prior to the expiration of the individual borrowing commitments ranging from June 30, 2008 though the maturity of the facility on September 30, 2009. Principal payments are effected through agreed-upon release prices paid to RFC, as homesites in the Secured Projects are sold. Interest payments are due monthly. The GMAC Communities Facility includes customary conditions to funding, acceleration and event of default provisions and certain financial affirmative and negative covenants. We use the proceeds from the GMAC Communities Facility to finance the acquisition and development of Bluegreen Communities projects. During 2007 we borrowed $68.5 million under the GMAC Communities Facility. In addition, we had repayments of approximately $54.4 million under this facility during 2007. As of December 31, 2007, the outstanding balance bore interest at 8.25%.

The Wachovia Line-of-Credit . In August 2007, we executed agreements to renew our unsecured line-of-credit with Wachovia Bank, N.A. and increase it from $15.0 million to $20.0 million. Amounts borrowed under the line bear interest at 30-day LIBOR plus 1.75%. Interest is due monthly, and all outstanding amounts are due on July 30, 2009. The line-of-credit agreement contains certain covenants and conditions typical of arrangements of this type. As of December 31, 2007, no borrowings were outstanding under this line; however, as of December 31, 2007 an aggregate of $551,000 of irrevocable letters of credit, were provided under this line-of-credit.

12. Senior Secured Notes Payable

On April 1, 1998, we consummated a private placement offering (the “Offering”) of $110.0 million in aggregate principal amount of 10.50% senior secured notes due April 1, 2008 (the “Notes”). On June 27, 2005, we used the proceeds from our junior subordinated debentures to redeem $55.0 million in aggregate principal amount of the Notes at a redemption price of 101.75% plus accrued and unpaid interest through June 26, 2005 of approximately $1.4 million. Interest on the Notes is payable semiannually on April 1 and October 1 of each year. The Notes are redeemable at our option, in whole or in part, in cash, together with accrued and unpaid interest, if any, to the date of redemption at par. As of December 31, 2006 and 2007, the principal balance of the Notes totaled $55.0 million.

The Notes are our senior obligations and rank pari passu in right of payment with all of our existing and future senior indebtedness and rank senior in right of payment to all of our existing and future subordinated obligations. None of the assets of Bluegreen Corporation secures our obligations under the Notes, and the Notes are effectively subordinated to our secured indebtedness to any third party to the extent of assets serving as security thereon. The Notes are unconditionally guaranteed, jointly and severally, by each of our subsidiaries (the “Subsidiary Guarantors”), with the exception of the Joint Venture, Bluegreen Properties N.V., Resort Title Agency, Inc., any special purpose finance subsidiary, any subsidiary which is formed and continues to operate for the limited purpose of holding a real estate license and acting as a broker, and certain other subsidiaries which have individually less than $50,000 of assets (collectively, “Non-Guarantor Subsidiaries”). Each of the note guarantees covers the full amount of the Notes and each of the Subsidiary Guarantors is 100% owned, directly or indirectly, by us. The Note guarantees are senior obligations of each Subsidiary Guarantor and rank pari passu in right of payment with all existing and future senior indebtedness of each such Subsidiary Guarantor and senior in right of payment to all existing and future subordinated indebtedness of each such Subsidiary Guarantor. The Note guarantees of certain Subsidiary Guarantors are secured by a first mortgage (subject to customary exceptions) or similar instrument (each, a “Mortgage”) on certain Bluegreen Communities properties of such Subsidiary Guarantors (the “Pledged Properties”). Absent the occurrence and the continuance of an event of default, the Notes trustee is required to release its lien on the Pledged Properties as property is sold and the Trustee does not have a lien on the proceeds of any such sale. As of December 31, 2007, the Pledged Properties had an aggregate net carrying value of approximately $944,692. The Notes’ indenture includes certain negative covenants including restrictions on the incurrence of certain debt and liens and on payments of cash dividends.

Supplemental financial information for Bluegreen Corporation, our combined Non-Guarantor Subsidiaries and our combined Subsidiary Guarantors is presented below.

CONDENSED CONSOLIDATING BALANCE SHEETS
(dollars in thousands)


	December 31, 2006


	Bluegreen Corporation				Combined Non-Guarantor Subsidiaries			Combined Subsidiary Guarantors			Eliminations				Consolidated


ASSETS
Cash and cash equivalents		$	36,316			$	17,002		$	17,830		$	—			$	71,148
Contracts receivable, net			—				1,222			22,634			—				23,856
Intercompany receivable			165,997				—			—			(165,997	)			—
Notes receivable, net			—				57,845			86,406			—				144,251
Inventory, net			—				17,967			331,366			—				349,333
Retained interests in notes receivable sold			—				130,623			—			—				130,623
Property and equipment, net			16,110				933			75,402			—				92,445
Investments in subsidiaries			290,084				—			3,230			(293,314	)			—
Other assets			7,860				4,582			30,114			—				42,556

Total assets		$	516,367			$	230,174		$	566,982		$	(459,311	)		$	854,212


LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Accounts payable, accrued liabilities and other		$	33,303			$	20,717		$	54,173		$	—			$	108,193
Intercompany payable			—				8,967			157,030			(165,997	)			—
Deferred income taxes			(19,813	)			47,864			59,573			—				87,624
Lines-of-credit and notes payable			4,646				18,914			121,902			—				145,462
10.50% senior secured notes payable			55,000				—			—			—				55,000
Junior subordinated debentures			90,208				—			—			—				90,208

Total liabilities			163,344				96,462			392,678			(165,997	)			486,487
Minority interest			—				—			—			14,702				14,702
Total shareholders’ equity			353,023				133,712			174,304			(308,016	)			353,023

Total liabilities and shareholders’ equity		$	516,367			$	230,174		$	566,982		$	(459,311	)		$	854,212


	December 31, 2007


	Bluegreen Corporation				Combined Non-Guarantor Subsidiaries			Combined Subsidiary Guarantors			Eliminations				Consolidated


ASSETS

Cash and cash equivalents		$	104,793			$	24,581		$	15,599		$	—			$	144,973
Contracts receivable, net			—				893			19,639			—				20,532
Intercompany receivable			112,312				13,138			—			(125,450	)			—
Notes receivable, net			—				77,414			83,251			—				160,665
Inventory, net			—				29,117			405,851			—				434,968
Retained interests in notes receivable sold			—				141,499			—			—				141,499
Property and equipment, net			13,471				562			80,388			—				94,421
Investments in subsidiaries			312,446				—			3,230			(315,676	)			—
Other assets			9,072				2,821			30,627			—				42,520

Total assets		$	552,094			$	290,025		$	638,585		$	(441,126	)		$	1,039,578


LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Accounts payable, accrued liabilities and other		$	21,620			$	17,961		$	96,300		$	—			$	135,881
Intercompany payable			—				—			125,450			(125,450	)			—
Deferred income taxes			(20,534	)			57,337			61,559			—				98,362
Lines-of-credit and notes payable			73				65,666			166,238			—				231,977
10.50% senior secured notes payable			55,000				—			—			—				55,000
Junior subordinated debentures			110,827				—			—			—				110,827

Total liabilities			166,986				140,964			449,547			(125,450	)			632,047
Minority interest			—				—			—			22,423				22,423
Total shareholders’ equity			385,108				149,061			189,038			(338,099	)			385,108

Total liabilities and shareholders’ equity		$	552,094			$	290,025		$	638,585		$	(441,126	)		$	1,039,578

CONDENSED CONSOLIDATING STATEMENTS OF INCOME
(dollars in thousands)


	Year Ended December 31, 2005


	Bluegreen Corporation				Combined Non-Guarantor Subsidiaries			Combined Subsidiary Guarantors			Eliminations				Consolidated


REVENUES
Sales of real estate		$	—			$	55,007		$	495,328		$	—			$	550,335
Other resort and communities operations revenue			—				13,236			60,561			—				73,797
Management fees			58,360				—			—			(58,360	)			—
Equity income from subsidiaries			52,045				—			—			(52,045	)			—
Interest income			1,379				17,294			16,125			—				34,798
Gain on sales of notes receivable			—				25,226			—			—				25,226


			111,784				110,763			572,014			(110,405	)			684,156
COSTS AND EXPENSES
Cost of real estate sales			—				15,955			161,845			—				177,800
Cost of other resort and communities operations			—				5,056			72,261			—				77,317
Management fees			—				1,158			57,202			(58,360	)			—
Selling, general and administrative expenses			61,934				27,297			211,008			—				300,239
Interest expense			4,446				2,875			7,153			—				14,474
Provision for loan losses			—				1,416			26,171			—				27,587
Other expense, net			1,967				3,117			1,123			—				6,207


			68,347				56,874			536,763			(58,360	)			603,624

Income before minority interest and provision for income taxes			43,437				53,889			35,251			(52,045	)			80,532
Minority interest in income of consolidated subsidiary			—				—			—			4,839				4,839

Income before provision for income taxes			43,437				53,889			35,251			(56,884	)			75,693
(Benefit) provision for income taxes			(3,114	)			19,502			12,754			—				29,142

Net income		$	46,551			$	34,387		$	22,497		$	(56,884	)		$	46,551


	Year Ended December 31, 2006

	Bluegreen Corporation			Combined Non-Guarantor Subsidiaries			Combined Subsidiary Guarantors			Eliminations				Consolidated


REVENUES
Sales of real estate		$	—		$	58,568		$	504,578		$	—			$	563,146
Other resort and communities operations revenue			—			14,198			49,412			—				63,610
Management fees			57,667			—			—			(57,667	)			—
Equity income from subsidiaries			26,572			—			—			(26,572	)			—
Interest income			1,768			24,753			14,244			—				40,765
Gain on sales of notes receivable			—			5,852			—			—				5,852


			86,007			103,371			568,234			(84,239	)			673,373
COSTS AND EXPENSES
Cost of real estate sales			—			16,134			162,920			—				179,054
Cost of other resort and communities operations			—			4,913			48,280			—				53,193
Management fees			—			844			56,823			(57,667	)			—
Selling, general and administrative expenses			48,158			29,953			278,878			—				356,989
Interest expense			4,853			4,106			9,826			—				18,785
Other expense, net			1,194			1,193			474			—				2,861


			54,205			57,143			557,201			(57,667	)			610,882

Income before minority interest and provision for income taxes			31,802			46,228			11,033			(26,572	)			62,491
Minority interest in income of consolidated subsidiary			—			—			—			7,319				7,319

Income before provision for income taxes			31,802			46,228			11,033			(33,891	)			55,172
Provision for income taxes			1,985			14,681			4,195			—				20,861

Income before cumulative effect of change in accounting principle			29,817			31,547			6,838			(33,891	)			34,311
Cumulative effect of change in accounting principle, net of tax			—			(1,942)			(3,736)			—				(5,678	)
Minority interest in income of cumulative effect of change in accounting principle			—			—			—			1,184				1,184

Net income		$	29,817		$	29,605		$	3,102		$	(32,707	)		$	29,817


	Year Ended December 31, 2007

	Bluegreen Corporation				Combined Non-Guarantor Subsidiaries				Combined Subsidiary Guarantors			Eliminations				Consolidated

REVENUES
Sales of real estate		$	—			$	56,354			$	526,404		$	—			$	582,758
Other resort and communities operations revenue			—				13,268				54,143			—				67,411
Management fees			69,182				—				—			(69,182	)			—
Equity income from subsidiaries			25,381				—				—			(25,381	)			—
Interest income			3,054				28,201				13,448			—				44,703
Sales of notes receivable			—				(3,378	)			—			—				(3,378	)

			97,617				94,445				593,995			(94,563	)			691,494
COSTS AND EXPENSES
Cost of real estate sales			—				12,965				165,766			—				178,731
Cost of other resort and communities operations			—				4,507				45,475			—				49,982
Management fees			—				9,782				59,400			(69,182	)			—
Selling, general and administrative expenses			47,118				32,481				297,952			—				377,551
Interest expense			18,912				5,360				—			—				24,272
Other expense (income), net			382				(133	)			1,494			—				1,743


			66,412				64,962				570,087			(69,182	)			632,279

Income before minority interest and provision for income taxes			31,205				29,483				23,908			(25,381	)			59,215
Minority interest in income of consolidated subsidiary			—				—				—			7,721				7,721

Income before provision for income taxes			31,205				29,483				23,908			(33,102	)			51,494
(Benefit) provision for income taxes			(721	)			11,203				9,086			—				19,568

Net income		$	31,926			$	18,280			$	14,822		$	(33,102	)		$	31,926

CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
(dollars in thousands)


	Year Ended December 31, 2005


	Bluegreen Corporation				Combined Non-Guarantor Subsidiaries				Combined Subsidiary Guarantors				Consolidated

Operating activities:
Net cash (used) provided by operating activities		$	(10,409	)		$	12,777			$	93,157			$	95,525

Investing activities:
Cash received from retained interests in notes receivable sold			—				11,016				—				11,016
Investment in statutory business trust			(1,780	)			—				—				(1,780	)
Installment payments on business acquisition			—				—				(675	)			(675	)
Purchases of property and equipment			(5,112	)			(216	)			(11,396	)			(16,724	)
Proceeds from sales of property and equipment			—				—				22				22

Net cash (used) provided by investing activities			(6,892	)			10,800				(12,049	)			(8,141	)

Financing activities:
Proceeds from borrowings collateralized by notes receivable			—				11,966				12,806				24,772
Payments on borrowings collateralized by notes receivable			—				(37,743	)			(26,971	)			(64,714	)
Proceeds from borrowings under line-of-credit facilities and notes payable			—				—				26,382				26,382
Payments under line-of-credit facilities and notes payable			(1,071	)			(1,113	)			(89,887	)			(92,071	)
Payments on 10.50% senior secured notes payable			(55,000	)			—				—				(55,000	)
Proceeds from issuance of junior subordinated debentures			59,280				—				—				59,280
Payment of debt issuance costs			(1,862	)			(37	)			(1,401	)			(3,300	)
Proceeds from exercise of employee and director stock options			1,406				—				—				1,406

Net cash provided (used) by financing activities			2,753				(26,927	)			(79,071	)			(103,245	)

Net increase (decrease) in cash and cash equivalents			(14,548	)			(3,350	)			2,037				(15,861	)
Cash and cash equivalents at beginning of period			70,256				18,793				11,516				100,565

Cash and cash equivalents at end of period			55,708				15,443				13,553				84,704
Restricted cash and cash equivalents at end of period			(173	)			(6,709	)			(11,439	)			(18,321	)

Unrestricted cash and cash equivalents at end of period		$	55,535			$	8,734			$	2,114			$	66,383


	Year Ended December 31, 2006

	Bluegreen Corporation				Combined Non-Guarantor Subsidiaries				Combined Subsidiary Guarantors				Consolidated

Operating activities:
Net cash (used) provided by operating activities		$	(41,538	)		$	(13,051	)		$	63,015			$	8,426

Investing activities:
Cash received from retained interests in notes receivable sold			—				30,032				—				30,032
Investments in statutory business trusts			(928	)			—				—				(928	)
Purchases of property and equipment			(7,180	)			(68	)			(17,488	)			(24,736	)
Proceeds from sales of property and equipment			—				—				93				93

Net cash (used) provided by investing activities			(8,108	)			29,964				(17,395	)			4,461

Financing activities:
Proceeds from borrowings collateralized by notes receivable			—				68,393				—				68,393
Payments on borrowings collateralized by notes receivable			—				(81,303	)			(3,811	)			(85,114	)
Proceeds from borrowings under line-of-credit facilities and notes payable			6,500				—				50,170				56,670
Payments under line-of-credit facilities and notes payable			(7,824	)			(193	)			(86,569	)			(94,586	)
Proceeds from issuance of junior subordinated debentures			30,928				—				—				30,928
Payment of debt issuance costs			(1,054	)			(2,251	)			(1,133	)			(4,438	)
Proceeds from exercise of employee and director stock options			2,645				—				—				2,645
Distributions to minority interest			(941	)			—				—				(941	)

Net cash provided (used) by financing activities			30,254				(15,354	)			(41,343	)			(26,443	)

Net (decrease) increase in cash and cash equivalents			(19,392	)			1,559				4,277				(13,556	)
Cash and cash equivalents at beginning of period			55,708				15,443				13,553				84,704

Cash and cash equivalents at end of period			36,316				17,002				17,830				71,148
Restricted cash and cash equivalents at end of period			(173	)			(8,478	)			(12,825	)			(21,476	)

Unrestricted cash and cash equivalents at end of period		$	36,143			$	8,524			$	5,005			$	49,672


	Year Ended December 31, 2007


	Bluegreen Corporation				Combined Non-Guarantor Subsidiaries				Combined Subsidiary Guarantors				Consolidated

Operating activities:
Net cash (used) provided by operating activities		$	44,015			$	(62,687	)		$	(2,449	)		$	(21,121	)

Investing activities:
Cash received from retained interests in notes receivable sold			—				35,949				—				35,949
Investments in statutory business trusts			(619	)			—				—				(619	)
Purchases of property and equipment			(4,868	)			(58	)			(10,929	)			(15,855	)
Proceeds from sales of property and equipment			—				—				2				2

Net cash (used) provided by investing activities			(5,487	)			35,891				(10,927	)			19,477

Financing activities:
Proceeds from borrowings collateralized by notes receivable			—				151,973				—				151,973
Payments on borrowings collateralized by notes receivable			—				(117,749	)			(2,396	)			(120,145	)
Proceeds from borrowings under line-of-credit facilities and notes payable			—				—				147,835				147,835
Payments under line-of-credit facilities and notes payable			(2,541	)			(89	)			(120,690	)			(123,320	)
Proceeds from issuance of junior subordinated debentures			20,619				—				—				20,619
Payment of debt issuance costs			(711	)			(628	)			(713	)			(2,052	)
Proceeds from exercise of employee and director stock options			559				—				—				559

Net cash provided by financing activities			17,926				33,507				24,036				75,469

Net increase in cash and cash equivalents			56,454				6,711				10,660				73,825
Cash and cash equivalents at beginning of period			36,316				17,002				17,830				71,148

Cash and cash equivalents at end of period			92,770				23,713				28,490				144,973
Restricted cash and cash equivalents at end of period			(475	)			(7,810	)			(11,175	)			(19,460	)

Unrestricted cash and cash equivalents at end of period		$	92,295			$	15,903			$	17,315			$	125,513

13. Junior Subordinated Debentures

Trust Preferred Securities Offerings

We have formed statutory business trusts (collectively, the “Trusts”) and each issued trust preferred securities and invested the proceeds thereof in our junior subordinated debentures. The Trusts are variable interest entities in which we are not the primary beneficiary as defined by FIN No. 46R. Accordingly, we do not consolidate the operations of the Trusts; instead, the Trusts are accounted for under the equity method of accounting. In each of these transactions, the applicable Trust issued trust preferred securities as part of a larger pooled trust securities offering which was not registered under the Securities Act of 1933. The applicable Trust then used the proceeds from issuing the trust preferred securities to purchase an identical amount of junior subordinated debentures from us. Interest on the junior subordinated debentures and distributions on the trust preferred securities are payable quarterly in arrears at the same interest rate. Distributions on the trust preferred securities are cumulative and based upon the liquidation value of the trust preferred security. The trust preferred securities are subject to mandatory redemption, in whole or in part, upon repayment of the junior subordinated debentures at maturity or their earlier redemption. The junior subordinated debentures are redeemable in whole or in part at the Company’s option at any time after five years from the issue date or sooner following certain specified events. In addition, we made an initial equity contribution to each Trust in exchange for its common securities, all of which are owned by us, and those proceeds were also used to purchase an identical amount of junior subordinated debentures from us. The terms of each Trust’s common securities are nearly identical to the trust preferred securities.

We had the following junior subordinated debentures outstanding at December 31, 2007 (dollars in thousands):

Trust

Outstanding
Amount of
Junior
Subordinated
Debentures

Initial
Equity
To
Trust (3)

Issue
Date

Fixed
Interest
Rate (1)

Variable
Interest
Rate (2)

Beginning
Optional
Redemption
Date

Maturity
Date

Bluegreen Statutory

3-month LIBOR

Trust I

23,196

696

3/15/05

9.160

+ 4.90%

3/30/10

3/30/35

Bluegreen Statutory

3-month LIBOR

Trust II

25,774

774

5/04/05

9.158

+ 4.85%

7/30/10

7/30/35

Bluegreen Statutory

3-month LIBOR

Trust III

10,310

310

5/10/05

9.193

+ 4.85%

7/30/10

7/30/35

Bluegreen Statutory

3-month LIBOR

Trust IV

15,464

464

4/24/06

10.130

+ 4.85%

6/30/11

6/30/36

Bluegreen Statutory

3-month LIBOR

Trust V

15,464

464

7/21/06

10.280

+ 4.85%

9/30/11

9/30/36

Bluegreen Statutory

3-month LIBOR

Trust VI

20,619

619

2/26/07

9.842

+ 4.80%

4/30/12

4/30/37

110,827

3,327


(1)	Both the trust preferred securities and junior subordinated debentures bear interest at a fixed interest rate from the issue date through the beginning optional redemption date.

(2)	Both the trust preferred securities and junior subordinated debentures bear interest at a variable interest rate from the beginning optional redemption date through the maturity date.

(3)	Initial equity in trust is recorded as part of other assets in our consolidated balance sheets.

14. Fair Value of Financial Instruments

In estimating the fair values of our financial instruments, we used the following methods and assumptions:

Cash and cash equivalents: The amounts reported in our consolidated balance sheets for cash and cash equivalents approximate fair value.

Contracts receivable: The amounts reported in our consolidated balance sheets for contracts receivable approximate fair value. Contracts receivable are non-interest bearing and generally convert into cash or an interest-bearing mortgage note receivable within thirty days.

Notes receivable: The amounts reported in our consolidated balance sheets for notes receivable approximate fair value based on discounted future cash flows using current rates at which similar loans with similar maturities would be made to borrowers with similar credit risk.

Retained interests in notes receivable sold: Retained interests in notes receivable sold are carried at fair value based on discounted cash flow analyses.

Lines-of-credit, notes payable, receivable-backed notes payable and junior subordinated debentures: The amounts reported in our consolidated balance sheets approximate their fair value for indebtedness that provides for variable interest rates. The fair value of our fixed-rate indebtedness was estimated using discounted cash flow analyses, based on our current incremental borrowing rates for similar types of borrowing arrangements.

10.50% senior secured notes payable and junior subordinated debentures: The fair values of our senior secured notes payable and junior subordinated debentures were based on the discounted value of contractual cash flows at a market discount rate or market price quotes from the over-the-counter bond market.


	December 31, 2006						December 31, 2007

	Carrying Amount			Estimated Fair Value			Carrying Amount			Estimated Fair Value


Cash and cash equivalents		$	71,148		$	71,148		$	144,973		$	144,973
Contracts receivable, net			23,856			23,856			20,532			20,532
Notes receivable, net			144,251			144,251			160,665			160,665
Retained interests in notes receivable sold			130,623			130,623			141,499			141,499
Lines-of-credit, notes payable, and receivable-backed notes payable			145,462			145,462			231,977			231,977
10.50% senior secured notes payable			55,000			55,275			55,000			54,725
Junior subordinated debentures			90,208			82,141			110,827			103,351

15. Common Stock and Stock Option Plans

Shareholders’ Rights Plan

On July 27, 2006, the Board of Directors adopted rights agreement (the “Rights Agreement”) and declared a dividend of one preferred share purchase right (a “Right”) for each outstanding share of the Company’s common stock. The Board of Directors authorized the adoption of the Rights Agreement to protect shareholders from coercive or otherwise unfair takeover tactics. In general terms, (as amended with Form 8-A/A filed with the SEC on May 24, 2007) the Rights Agreement imposes a significant penalty upon any person or group which acquires beneficial ownership of 10% or more of the Company’s outstanding common stock without the prior approval of the Board of Directors. The Company, its subsidiaries, employee benefit plans or any of its subsidiaries, and any entity holding common stock for or pursuant to the terms of any such employee benefit plan will be excepted, as will Levitt Corporation, its affiliates, successors and assigns.

On October 16, 2006, in connection with the settlement of litigation then pending before the United States District Court for the Southern District of Florida between the Company, as plaintiff, David A. Siegel, David A. Siegel Revocable Trust, and Central Florida Investments, Inc., as defendants (collectively, the “Siegel Shareholders”), and the directors of the Company, as counter-defendants, the Rights Agreement was amended pursuant to a Stipulation and Order (the “Stipulation”) to extend the period in which the Siegel Shareholders may divest their shares of the Company’s common stock to avoid the impact of the Rights Agreement. On May 21, 2007 and October 16, 2007, we amended the Stipulation and the Rights Agreement to further extend the period in which the Siegel Shareholders may divest their shares of the Company’s common stock. The Stipulation, as currently in effect, requires that the Siegel Shareholders their ownership of an aggregate of 1,112,000 of shares of the Company’s common stock by April 16, 2008, to divest an additional 4,260,198 shares of the Company’s common stock by October 16, 2008 and to divest their remaining shares of the Company’s common stock by October 16, 2009. However, if the Siegel Shareholders breach any provision of the Stipulation, the Company’s Board of Directors may terminate the period for divestiture.

Stock Option Plans

Under our employee stock option plans, options can be granted with various vesting periods. Options granted to employees subsequent to December 31, 2002 vest 100% on the five-year anniversary of the date of grant. Our options are granted at exercise prices that either equal or exceed the quoted market price of our common stock at the respective dates of grant. All of our options expire ten years from the date of grant.

All options granted to non-employee directors (the “Outside Directors”) on or prior to December 31, 2002 vested ratably over a three-year period while options granted after December 31, 2002 vest either immediately upon grant or on the five-year anniversary of the date of grant. All Outside Director stock options are nonqualified and expire ten years from the date of grant, subject to alternative expiration dates under certain circumstances.

The following table lists our grants of stock options and restricted stock to our employees and our non-employee directors under the 2005 Stock Incentive Plan (in thousands, in shares). See Note 1 of the Notes to Consolidated Financial Statements for further discussion of stock options granted.


	Stock Option Awards							Restricted Stock Awards

	Employees		Directors		Weighted average grant date fair value			Employees		Directors


2005		668,000		141,346		$	10.81		—		5,374
2006		440,000		142,785		$	6.58		—		17,497
2007		—		136,494		$	5.58		196,850		16,696

Total		1,108,000		420,625					196,850		39,567

A summary of our stock option activity related to all of our prior and current stock option plans is presented below (in thousands, except per share data).


	Number of Shares Reserved			Outstanding Options			Weighted Average Exercise Price Per Share			Number of Shares Exercisable


Balance at December 31, 2005		3,201			2,010			$	10.65		665
Granted		—			583			$	12.02
Forfeited		(86	)		(217	)		$	11.20
Exercised		(312	)		(312	)		$	8.48

Balance at December 31, 2006		2,803			2,064			$	11.31		481


Granted		—			137			$	11.98
Forfeited		—			(123	)		$	17.05
Exercised		(140	)		(140	)		$	3.99

Balance at December 31, 2007		2,663			1,938			$	11.51		579

The weighted average exercise price of shares exercisable as of December 31, 2007 was $9.00 and the weighted average remaining contractual term of these shares was 5.7 years. The aggregate intrinsic value of our stock options outstanding and exercisable was $3.7 million and $1.0 million as of December 31, 2006 and 2007, respectively. The total intrinsic value of our stock options exercised during the years ended December 31, 2005, 2006, and 2007 was $2.9 million, $1.4 million and $1.1 million, respectively. The weighted-average exercise prices and weighted-average remaining contractual lives of our outstanding stock options at December 31, 2007 (grouped by range of exercise prices) were:

100


	Number of Options		Number of Vested Options		Weighted- Average Remaining Contractual Term		Weighted- Average Exercise Price			Weighted- Average Exercise Price (Vested Only)

	(In 000’s)		(In 000’s)		(In years)

$2.11 - $3.00		35		35		3.5		$	2.21		$	2.21
$3.01 - $4.52		423		220		4.8		$	3.47		$	3.45
$4.53 - $6.79		130		30		5.3		$	5.86		$	5.92
$6.80 - $10.20		39		39		1.0		$	8.82		$	8.82
$10.21 - $15.31		684		114		9.4		$	11.96		$	11.47
$15.32 - $18.36		627		141		7.6		$	18.29		$	18.04

		1,938		579		7.2		$	11.51		$	9.00

Common Stock Reserved For Future Issuance

As of December 31, 2007, common stock reserved for future issuance was comprised of shares issuable (in thousands):


Upon exercise of stock options under our employee stock option plan (1)			2,598
Upon exercise of outside director stock options under our director stock option plan			65

			2,663


(1)	Stock options were granted to non-employee directors under our Employee Stock Option Plan during 2005, 2006 and 2007.

16. Commitments and Contingencies

At December 31, 2007, the estimated cost to complete development work in subdivisions or resorts from which homesites or VOIs have been sold totaled $76.6 million. Development is estimated to be completed as follows: 2008 — $46.5 million, 2009 - $21.6 million, 2010 and beyond - $8.5 million.

In 2006 we entered into a separation agreement with our former CEO, George Donovan. Under the terms of this agreement, Mr. Donovan will be paid a total of $3 million over a seven year period in exchange for his services to be available on a when and if needed basis. We recorded an expense of $2.6 million in 2006, which represents the then present value of the seven year agreement. As of December 31, 2007 we owed Mr. Donovan $2.5 million in remaining payments, the present value of which is recorded as a liability on our consolidated balance sheet.

Rent expense for the years ended December 31, 2005, 2006, and 2007 totaled approximately $8.5 million, $11.6 million and $13.0 million, respectively.

Lease commitments under these and our various other noncancelable operating leases for each of the five years subsequent to December 31, 2007, and thereafter are as follows (in thousands):


2008	$	9,130
2009		8,100
2010		6,937
2011		4,388
2012		3,467
Thereafter		22,081

Total future minimum lease payments	$	54,103

At December 31, 2007, we had approximately $551,000 in outstanding commitments under stand-by letters of credit with banks, primarily related to the construction of an elevated water tank for one our Bluegreen Communities projects.

In the ordinary course of our business, we become subject to claims or proceedings from time to time relating to the purchase, subdivision, sale or financing of real estate. Additionally, from time to time, we become involved in disputes with existing and former employees, vendors, taxing jurisdictions and various other parties. Unless otherwise described below, we believe that these claims are routine litigation incidental to our business. The following are matters that we are describing in more detail in accordance with SFAS No. 5, Accounting for Contingencies .

101

Bluegreen Resorts

Tennessee Tax Audit

Shore Crest Claim

LeisurePath Vacation Club

In Michelle Alamo, Ernest Alamo, Toniann Quinn and Terrance Quinn v. Vacation Station, LLC, LeisurePath Vacation Club, LeisurePath, Inc., Bluegreen Corporation, Superior Court of New Jersey, Bergen County, Docket No. L-6716-05 , Civil Action, Plaintiffs filed a purported “Class Action Complaint” on September 23, 2005. The Complaint raises allegations concerning the marketing of the LeisurePath Travel Services Network product to the public, and, in particular, New Jersey residents by Vacation Station, LLC, an independent distributor of travel products. Vacation Station, LLC purchased LeisurePath membership kits from LeisurePath, Inc.’s Master Distributor, Mini Vacations, Inc. and then sold the memberships to consumers. The initial Plaintiffs (none of whom actually bought the Leisure Path product) assert claims for violations of the New Jersey Consumer Fraud Act, fraud, nuisance, negligence and for equitable relief all stemming from the sale and marketing by Vacation Station, LLC of the LeisurePath Travel Services Network. Plaintiffs are seeking the gifts and prizes they were allegedly told by Vacation Station, LLC that they won as part of the sales promotion, and that they be given the opportunity to rescind their agreement with LeisurePath along with a full refund. Plaintiffs further seek punitive damages, compensatory damages, attorneys’ fees and treble damages of unspecified amounts. In February 2007, the Plaintiffs amended the complaint to add two additional Plaintiffs/proposed class representatives, Bruce Doxey and Karen Smith-Doxey. Unlike the initial Plaintiffs who were first contacted by Vacation Station, LLC some seven (7) months after LeisurePath terminated its relationship with Vacation Station, LLC and did not purchase LeisurePath products, the Doxeys purchased a participation in the LeisurePath Travel Services Network. Vacation Station, LLC and its owner have each filed for bankruptcy protection and accordingly the case is being pursued against LeisurePath and Bluegreen Corporation. In the Fall of 2007 the court denied plaintiffs’ request to certify their claims as a class action. Subsequently, the parties negotiated a settlement in an effort to extinguish the claims of persons who purchased the benefits of the Leisure Path Travel Services Network. The parties have reached an agreement in principle to a settlement pursuant to which persons who purchased a participation in the Network from Vacation Station, LLC’s sales office in Hackensack, New Jersey will be allowed to select either: (1) seven consecutive nights of accommodations in a Bluegreen resort located in either Orlando, Las Vegas, or Myrtle Beach to be used by December 31, 2009; or (2) continued memberships and a waiver of their Network membership fees until 2012. In an effort to resolve any claims of individuals who may allege improper soliciting, but did not purchase a participation in the Network, an agreed upon number of three day/two night vacation certificates (for use at the same properties listed above) will be made available. The first non-purchasers who submit a prepared affidavit swearing to the validity of their claim will receive these certificates. Furthermore, Defendants have agreed in principle to a “high-low agreement” with regard to Plaintiffs’ Counsel’s attorney’s fees pursuant to which he will receive a minimum of $150,000.00 and a maximum of $300,000.00 depending upon the Court’s fee award. Incentive payments totaling

102

$13,000.00 will be made to the six named Plaintiffs in the suit. This settlement structure was preliminarily approved by the court on January 18, 2008. A Fairness Hearing for final approval of the proposed settlement will take place on April 18, 2008. As of December 31, 2007, we have accrued $260,000 in connection with this matter, which is equal to the approximate cost of the proposed settlement and the low end of the range in the high-low agreement in accordance with the provisions of the Statement of Financial Accounting Standard No. 5, Accounting for Contingencies .

Bluegreen Communities

Mountain Lakes Mineral Rights

17. Income Taxes

Our provision for income taxes consists of the following (in thousands):


	Year Ended December 31, 2005			Year Ended December 31, 2006			Year Ended December 31, 2007

Federal:
Current		$	9,418		$	7,397		$	5,124
Deferred			15,600			11,913			12,749

			25,018			19,310			17,873

State and other:
Current			2,745			629			1,976
Deferred			1,379			922			(281	)

			4,124			1,551			1,695

Total		$	29,142		$	20,861		$	19,568

103

The reasons for the difference between our provision for income taxes and the amount that results from applying the federal statutory tax rate to income before provision for income taxes and cumulative effect are as follows (in thousands):


	December 31, 2005			December 31, 2006			December 31, 2007


Income tax expense at statutory rate		$	25,018		$	19,310		$	18,024
Effect of state taxes, net of federal tax benefit			4,124			1,551			1,004
Other			—			—			540

		$	29,142		$	20,861		$	19,568

Our deferred income taxes consist of the following components (in thousands):


	December 31, 2006				December 31, 2007

Deferred federal and state tax liabilities (assets):
Installment sales treatment of notes		$	196,687			$	234,528
Deferred federal and state loss carryforwards/AMT credits			(120,609	)			(146,889	)
Book over tax carrying value of retained interests in notes receivable sold			15,565				17,648
Book reserves for loan losses and inventory			(7,758	)			(9,070	)
Tax over book depreciation			5,780				4,862
Unrealized gains on retained interests in notes receivable sold (see Note 6)			7,742				5,739
Deferral of VOI sales under SFAS No. 152			(4,365	)			(5,016	)
Other			(5,418	)			(3,440	)

Deferred income taxes		$	87,624			$	98,362

Total deferred federal and state tax liabilities		$	229,085			$	266,590
Total deferred federal and state tax assets			(141,461	)			(168,228	)

Deferred income taxes		$	87,624			$	98,362

We have available federal net operating loss carryforwards of $253 million, which expire beginning in 2021 through 2027, and alternative minimum tax credit carryforwards of $36 million, which never expire. Additionally, we have available state operating loss carryforwards of $544 million, which expire beginning in 2008 through 2027 and Florida alternative minimum tax credit carryforwards of $2.1 million, which never expire. The income tax benefits from our state operating loss carryforwards are net of a valuation allowance of $1.7 million.

Internal Revenue Code Section 382 addresses limitations on the use of net operating loss carry forwards following a change in ownership, as defined in Section 382. We do not believe that any such ownership change occurred during 2006. If our interpretation were found to be incorrect, there would be significant limitations placed on these carry forwards which would result in an increase in the Company’s tax liability and a reduction of its net income.

We and our subsidiaries file income tax returns in the U.S. federal jurisdiction and various states and foreign jurisdictions. With few exceptions, we are no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2003.

The Internal Revenue Service (“IRS”) commenced an examination of our U.S. income tax returns for 2004 and 2005 in the first quarter of 2007. On October 12, 2007, we received an examination report (the “2004 & 2005 Examination Report”) from the IRS for the 2004 & 2005 tax periods asserting, in the aggregate, approximately $35,000 of additional tax due, plus accrued interest.

In July 2006, the FASB issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes-an Interpretation of FASB Statement No. 109 (“FIN 48”), which clarifies the accounting for uncertainty in tax positions. Based on an evaluation of uncertain tax provisions, we are required to measure tax benefits based on the largest amount of benefit that is greater than 50% likely of being realized upon settlement. The adoption of FIN 48 on January 1, 2007 did not have an impact on our financial position or results of operations. In accordance with our accounting policy, we recognize interest and penalties related to unrecognized taxes as a component of general and administrative expenses. This policy did not change as a result of the adoption of FIN 48.

104

On July 12, 2007, the Governor of the State of Michigan signed the Michigan Business Tax Act (“MBT”), which imposes a business income tax and a modified gross receipts tax. The MBT, which became effective January 1, 2008, replaced the state’s current Single Business Tax, which expired on December 31, 2007. The MBT creates a new tax on business income and is assessed on every taxpayer with business activity in Michigan, unless prohibited by federal law. The base of the tax starts with federal taxable income or a comparable measure of income for partnerships and S corporations, which is then subject to various adjustments, including apportionment, to identify business activity in Michigan. The tax rate is 4.95%. The MBT also creates a new tax based on a modified measure of a business’ gross receipts. The base of the tax is gross receipts less purchases from other firms. Purchases from other firms include inventory purchased during the tax year and capital expenditures. The tax rate is 0.8%. We do not believe that the MBT will have a material impact on our effective tax rate.

As of December 31, 2007, we had no amounts recorded for uncertain tax positions.

18. Employee Retirement Savings Plan and Other Employee Matters

Our Employee Retirement Plan is an Internal Revenue Code section 401(k) Retirement Savings Plan (the “Plan”). All employees at least 21 years of age with one year of employment with us are eligible to participate in the Plan. The Plan, as amended, provides an annual employer discretionary matching contribution and a fixed-rate employer matching contribution equal to 50% of the first 3% of a participant’s contribution with an annual limit of $1,000 per participant. During the years ended December 31, 2005, 2006, and 2007, we recognized expenses for our contributions to the Plan of approximately $620,000, $720,000 and $903,000, respectively. Effective for 2008, the fixed-rate employer match was increased to 100% of the first 3% of a participant’s contribution with an annual limit of $1,500 per participant.

Our employees in Aruba, which comprise approximately 1% of our total workforce, are subject to the terms of a collective bargaining agreement.

19. Business Segments

We have two reportable business segments – Bluegreen Resorts and Bluegreen Communities. Bluegreen Resorts develops markets and sells VOIs in our resorts, through the Bluegreen Vacation Club, and provides resort management services to resort property owners associations. Bluegreen Communities acquires large tracts of real estate, which are subdivided, improved (in some cases to include a golf course on the property and other related amenities) and sold, typically on a retail basis as homesites. Our reportable segments are business units that offer different products. The reportable segments are each managed separately because they sell distinct products with different development, marketing and selling methods.

We evaluate the performance and allocate resources to each business segment based on its respective field operating profit. Field operating profit is operating profit prior to the allocation of corporate overhead, interest income, other income or expense items, interest expense, income taxes, minority interest and cumulative effect of change in accounting principle. Inventory and notes receivable are the only assets that we evaluate on a segment basis — all other assets are only evaluated on a consolidated basis. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies in Note 1 to the Consolidated Financial Statements.

Required disclosures for our business segments are as follows (in thousands):

105


	Bluegreen Resorts			Bluegreen Communities			Totals

As of and for the year ended December 31, 2005:
Sales of real estate
		$	358,240		$	192,095		$	550,335
Other resort and communities operations revenue			64,276			9,521			73,797
Depreciation expense			7,161			1,684			8,845
Field operating profit			59,578			47,227			106,805
Inventory, net			173,338			67,631			240,969
Notes Receivable, net			120,592			7,191			127,783
Goodwill			4,291			—			4,291

As of and for the year ended December 31, 2006:
Sales of real estate		$	399,105		$	164,041		$	563,146
Other resort and communities operations revenue			51,688			11,922			63,610
Depreciation expense			8,322			1,641			9,963
Field operating profit			53,937			35,824			89,761
Inventory, net			233,290			116,043			349,333
Notes Receivable, net			137,509			6,742			144,251
Goodwill			4,291			—			4,291

As of and for the year ended December 31, 2007:
Sales of real estate		$	453,541		$	129,217		$	582,758
Other resort and communities operations revenue			53,624			13,787			67,411
Depreciation expense			8,356			1,715			10,071
Field operating profit			69,909			23,633			93,542
Inventory, net			288,969			145,999			434,968
Notes Receivable, net			155,591			5,074			160,665
Goodwill			4,291			—			4,291

Reconciliations to Consolidated Amounts

Field operating profit for our reportable segments reconciled to our consolidated income before provision for income taxes and minority interest is as follows (in thousands):


	Year Ended December 31,

			2005			2006			2007

Field operating profit for reportable segments		$	106,805		$	89,761		$	93,542
Interest income			34,798			40,765			44,703
Sales of notes receivable			25,226			5,852			(3,378	)
Other expense, net			(6,207	)		(2,861	)		(1,743	)
Corporate general and administrative expenses			(38,029	)		(52,241	)		(49,637	)
Interest expense			(14,474	)		(18,785	)		(24,272	)
Provision for loan losses			(27,587	)		—			—

Consolidated income before minority interest and provision for income taxes		$	80,532		$	62,491		$	59,215

Depreciation expense for our reportable segments reconciled to our consolidated depreciation expense is as follows (in thousands):


	Year Ended December 31,

	2005			2006			2007


Depreciation expense for reportable segments		$	8,845		$	9,963		$	10,071
Depreciation expense for corporate fixed assets			3,487			4,413			4,418

Consolidated depreciation expense		$	12,332		$	14,376		$	14,489

106

Assets for our reportable segments reconciled to our consolidated assets (in thousands):


	December 31,

	2006		2007


Notes receivable for reportable segments		144,251		160,665
Inventory for reportable segments		349,333		434,968
Goodwill		4,291		4,291
Assets not allocated to reportable segments		356,337		439,654

Total assets	$	854,212	$	1,039,578

Geographic Information

Sales of real estate by geographic area are as follows (in thousands):


	Year Ended December 31,

	2005		2006		2007


United States	$	539,131	$	554,904	$	575,309
Aruba		11,204		8,242		7,449

Consolidated totals	$	550,335	$	563,146	$	582,758

Inventory by geographic area is as follows (in thousands):


	December 31,

	2006		2007


United States	$	344,817	$	431,160
Aruba		4,516		3,808

Consolidated totals	$	349,333	$	434,968

20. Quarterly Financial Information (Unaudited)

A summary of the quarterly financial information for the years ended December 31, 2006 and 2007 is presented below (in thousands, except for per share information).


	For the Three Months Ended

	March 31, 2006			June 30, 2006		September 30, 2006		December 31, 2006


Sales of real estate	$	121,760		$	141,947	$	172,549	$	126,890
Gross profit		76,538			92,925		125,822		88,807
Income before cumulative effect of change in accounting principle		4,031			6,580		21,907		1,793
Cumulative effect of change in accounting principle, net of tax and minority interest		(4,494	)		—		—		—
Net (loss) income	$	(463	)	$	6,580	$	21,907	$	1,793

Income before cumulative effect of change in accounting principle per common share:
Basic	$	0.13		$	0.22	$	0.72	$	0.06
Diluted	$	0.13		$	0.21	$	0.71	$	0.06

Net (loss) income per common share:
Basic	$	(0.02	)	$	0.22	$	0.72	$	0.06
Diluted	$	(0.01	)	$	0.21	$	0.71	$	0.06

107


	For the Three Months Ended

	March 31, 2007		June 30, 2007		September 30, 2007		December 31, 2007


Sales of real estate	$	122,022	$	143,274	$	180,870	$	136,592
Gross profit		85,290		96,969		125,310		96,458
Net income		5,333		4,092		13,953		8,548

Net income per common share:
Basic	$	0.17	$	0.13	$	0.45	$	0.28
Diluted	$	0.17	$	0.13	$	0.45	$	0.27

21. Subsequent Events

In February 2008, we announced that we intend to pursue a rights offering to our shareholders of up to $100 million of our common stock. We intend to file a registration statement relating to the rights offering in March. While we had $125.5 million of unrestricted cash and cash equivalents at December 31, 2007, the purpose of the rights offering is to further strengthen our balance sheet in light of its $55 million of senior secured notes maturing in April 2008 and to support growth, including growth through acquisitions. We intend to pursue available opportunities and evaluate our business plan for Bluegreen Communities, with the long-term goal being to best position our company to take advantage of strategic alternatives so as to maximize shareholder value in the future.

In January 2008, we transferred $26.0 million of notes receivable and received $21.5 million in cash proceeds under the 2006 BB&T Purchase Facility. In February 2008, we transferred an additional $18.8 million of notes receivable and received $15.6 million in cash proceeds under the same facility. Our remaining availability subsequent to these transfers was $83.9 million.

In January 2008, we borrowed approximately $7.5 million under our GMAC AD&C Facility for development at our resort in Las Vegas, Nevada and our Fountains resort in Orlando, Florida. We also borrowed $10.2 million under the GMAC Communities Facility for general corporate purposes.

108

Report of Independent Registered Public Accounting Firm

The Board of Directors and Shareholders of
Bluegreen Corporation

We have audited the accompanying consolidated balance sheets of Bluegreen Corporation (the Company) as of December 31, 2007 and 2006, and the related consolidated statements of income, shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2007. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Bluegreen Corporation at December 31, 2007 and 2006, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2007, in conformity with U.S. generally accepted accounting principles.

As discussed in Note 1 to the consolidated financial statements, the Company adopted SFAS No. 123(R), Share-Based Payment , applying the modified prospective method at the beginning of 2006. As discussed in Note 2, in 2006 the Company has also adopted SFAS No. 152, Accounting for Real Estate Time-Sharing Transactions .

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Bluegreen Corporation’s internal control over financial reporting as of December 31, 2007, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 26, 2008 expressed an unqualified opinion thereon.


	/s/ Ernst & Young LLP
	Certified Public Accountants

West Palm Beach, Florida
February 26, 2008

109

Report of Independent Registered Public Accounting Firm

The Board of Directors and Shareholders of
Bluegreen Corporation

We have audited Bluegreen Corporation’s internal control over financial reporting as of December 31, 2007, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). Bluegreen Corporation’s management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, Bluegreen Corporation maintained, in all material respects, effective internal control over financial reporting as of December 31, 2007, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Bluegreen Corporation as of December 31, 2007 and 2006, and the related consolidated statements of income, shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2007 of Bluegreen Corporation and our report dated February 26, 2008, expressed an unqualified opinion thereon.


	/s/ Ernst & Young LLP
	Certified Public Accountants

West Palm Beach, Florida
February 26, 2008

110

Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f). Under the supervision and with the participation of our management, including our Principal Executive Officer and Principal Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on our evaluation under the framework in Internal Control – Integrated Framework , our management concluded that our internal control over financial reporting was effective as of December 31, 2007.

The Company’s financial statements included in this Annual Report on Form 10-K have been audited by Ernst & Young LLP, an independent registered public accounting firm. Ernst & Young LLP has also provided an attestation report on the Company’s internal control over financial reporting.

JOHN M. MALONEY, JR., President and Chief Executive Officer
ANTHONY M. PULEO, Senior Vice President, Chief Financial Officer and Treasurer

111


Item 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE .

None.


Item 9A.	CONTROLS AND PROCEDURES.

Management, including the Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures and internal controls will prevent all errors and all improper conduct. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that we have detected all control issues and instances of improper conduct, if any. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control.

Further, the design of any system of controls also is based in part upon assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the design and operation of our “disclosure controls and procedures”, as such term is defined under Rule 13a-15(e) promulgated under the Exchange Act as of December 31, 2007. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of December 31, 2007.

Changes in Internal Control Over Financial Reporting

None.

Management’s Report on Internal Control Over Financial Reporting

Management’s report and the Report of Independent Registered Public Accounting Firm on internal control over financial reporting are set forth in Part II, Item 8 – Financial Statements and Supplementary Data of this report.

Chief Executive Officer and Chief Financial Officer Certifications

Appearing as Exhibits 31.1 and 31.2 to this Annual Report are the Certifications of the Principal Executive Officer and the Principal Financial Officer. The Certifications are required in accordance with Section 302 of the Sarbanes-Oxley Act of 2002. This Item of this Annual Report is the information concerning the evaluation referred to in the Section 302 Certifications and this information should be read in conjunction with the Section 302 Certifications for a more complete understanding of the topics presented.


Item 9B.	OTHER INFORMATION.

None.

112

PART III


Item 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

Information with respect to our Directors required by Item 10 is incorporated by reference to our Proxy Statement for our 2008 Annual Meeting of Shareholders. The information concerning our executive officers required by Item 10 is contained in the discussion entitled “Executive Officers” in Item 1. Business of Part I hereof.


Item 11.	EXECUTIVE COMPENSATION.

The information required by Item 11 is incorporated by reference to our Proxy Statement for our 2008 Annual Meeting of Shareholders.


Item 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

The information required by Item 12 is incorporated by reference to our Proxy Statement for our 2008 Annual Meeting of Shareholders.


Item 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.

The information required by Item 13 is incorporated by reference to our Proxy Statement for our 2008 Annual Meeting of Shareholders.


Item 14.	PRINCIPAL ACCOUNTING FEES AND SERVICES.

The information required by Item 14 is incorporated by reference to our Proxy Statement for our 2008 Annual Meeting of Shareholders.

113

PART IV


Item 15.	EXHIBITS, FINANCIAL STATEMENT SCHEDULES.

(a)(1) and (a)(2) List of Financial Statements and Schedules.


1.	The following list of our Financial Statements and Notes thereto and the report of independent registered public accounting firm relating thereto, are included in Item 8.

	Consolidated Balance Sheets as of December 31, 2006 and December 31, 2007.

	Consolidated Statements of Income for the years ended December 31, 2005, 2006 and 2007.

	Consolidated Statements of Shareholders’ Equity for the years ended December 31, 2005, 2006 and 2007.

	Consolidated Statements of Cash Flows for the years ended December 31, 2005, 2006 and 2007.

	Notes to Consolidated Financial Statements.

	Report of Independent Registered Public Accounting Firm.

2.	All financial statement schedules are omitted because they are not applicable, are not present in amounts sufficient to require submission of the schedules or the required information is presented in the Consolidated Financial Statements or related notes.

(a)(3) List of Exhibits.

The exhibits which are filed with this Annual Report on Form 10-K or which are incorporated herein by reference are set forth in the Exhibit Index which appears at pages 117 through 125 hereof and are incorporated herein by reference.

(b) Exhibits.

See (a)(3) above.

(c) Financial Statement Schedules.

All financial statement schedules are omitted because they are not applicable, are not present in amounts sufficient to require submission of the schedules or the required information is presented in the Consolidated Financial Statements or related notes.

114

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


	BLUEGREEN CORPORATION (Registrant)

Date: March 3, 2008	By:	/S/ JOHN M. MALONEY, JR.

		John M. Maloney, Jr.,
		President and Chief Executive Officer


Date: March 3, 2008	By:	/S/ ANTHONY M. PULEO

		Anthony M. Puleo,
		Senior Vice President, Chief Financial Officer and Treasurer
		(Principal Financial Officer)


Date: March 3, 2008	By:	/S/ RAYMOND S. LOPEZ

		Raymond S. Lopez,
		Vice President and Chief Accounting Officer
		(Principal Accounting Officer)

115

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on the 3 ^rd day of March, 2008.


Signature		Title


/S/ JOHN M. MALONEY, JR		President, Chief Executive Officer

John M. Maloney, Jr.

/S/ ANTHONY M. PULEO		Senior Vice President, Chief Financial Officer and Treasurer
		(Principal Financial Officer)
Anthony M. Puleo

/S/ RAYMOND S. LOPEZ		Vice President and Chief Accounting Officer
		(Principal Accounting Officer)
Raymond S. Lopez

/S/ ALAN B. LEVAN		Chairman of the Board of Directors

Alan B. Levan

/S/ JOHN E. ABDO		Vice Chairman of the Board of Directors

John E. Abdo

/S/ NORMAN H. BECKER		Director

Norman H. Becker

/S/ LAWRENCE CIRILLO		Director

Lawrence Cirillo

/S/ ROBERT F. DWORS		Director

Robert F. Dwors

/S/ SCOTT W. HOLLOWAY		Director

Scott W. Holloway

/S/ JOHN LAGUARDIA		Director

John Laguardia

/S/ MARK A. NERENHAUSEN		Director

Mark A. Nerenhausen

/S/ J. LARRY RUTHERFORD		Director

J. Larry Rutherford

/S/ ARNOLD SEVELL		Director

Arnold Sevell

116

EXHIBIT INDEX


Number		Description


3.1	-	Restated Articles of Organization, as amended (incorporated by reference to exhibit of same designation to Annual Report on Form 10-K for the year ended March 31, 1996).

3.2	-	Restated and amended By-laws of the Registrant (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated September 30, 2005).

4.1	-	Bluegreen Corporation and Mellon Investor Services LLC, Rights Agreement dated July 27, 2006 (incorporated by reference to exhibit of same designation to Current Report on Form 8-K dated August 2, 2006).

4.2	-	Amendment to Rights Agreement between Bluegreen Corporation and Mellon Investor Services LLC, dated October 16, 2006 (incorporated by reference to exhibit 99.2 to Current Report on Form 8-K dated October 18, 2006).

4.3	-	Stipulation and Order from the United States District Court, Southern District of Florida, Case No. 06-80718-CIV-Hurley/Seltzer between Bluegreen Corporation and David A. Siegel, David A. Siegel Revocable Trust, and Central Florida Investments (incorporated by reference to exhibit 99.1 to Current Report on Form 8-K dated October 18, 2006).

4.4		Second Amendment to Stipulation and Order, dated as of October 15, 2007, by and between Bluegreen Corporation and its directors and David A. Siegel, David A. Siegel Revocable Trust, and Central Florida Investments, Inc. (incorporated herein by reference to Exhibit 99.3 of the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on October 16, 2007).

4.5	-	Second Amendment to Rights Agreement, dated as of May 21, 2007, by and between Bluegreen Corporation and Mellon Shareholder Services LLC, as Rights Agent (incorporated herein by reference to Exhibit 99.4 of the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on May 21, 2007

4.6	-	Third Amendment to Rights Agreement, dated as of October 15, 2007, by and between Bluegreen Corporation and Mellon Shareholder Services LLC, as Rights Agent (incorporated herein by reference to Exhibit 99.6 of the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on October 16, 2007).

4.7	-	Indenture dated as of April 1, 1998 by and among the Registrant, certain subsidiaries of the Registrant, and SunTrust Bank, Central Florida, National Association, as trustee, for the 10½ % Senior Secured Notes due 2008 (incorporated by reference to exhibit of same designation to Registration Statement on Form S-4, File No. 333-50717).

4.8	-	First Supplemental Indenture dated as of March 15, 1999 by and among the Registrant, certain subsidiaries of the Registrant, and SunTrust Bank, Central Florida, National Association, as trustee, for the 10½ % Senior Secured Notes due 2008 (incorporated by reference to exhibit of same designation to Annual Report on Form 10-K for the fiscal year ended March 28, 1999).

4.9	-	Second Supplemental Indenture dated as of December 31, 2000 by and among the Registrant, certain subsidiaries of the Registrant, and SunTrust Bank, Central Florida, National Association, as trustee, for the 10½ % Senior Secured Notes due 2008 (incorporated by reference to exhibit of same designation to Annual Report on Form 10-K for the fiscal year ended March 31, 2002).

4.10	-	Third Supplemental Indenture dated as of October 31, 2001 by and among the Registrant, certain subsidiaries of the Registrant, and SunTrust Bank, Central Florida, National

117


		Association, as trustee, for the 10½% Senior Secured Notes due 2008 (incorporated by reference to exhibit of same designation to Annual Report on Form 10-K for the fiscal year ended March 31, 2002).

4.11	-	Fourth Supplemental Indenture dated as of December 31, 2001 to the Indenture Dated as of April 1, 1998 among the Registrant, certain of its subsidiaries and SunTrust Bank (formerly SunTrust Bank, Central Florida, National Association), as Notes Trustee, relating to the Company’s $110 million aggregate principal amount of 10½% Senior Secured Notes due 2008 (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated December 30, 2001).

4.12	-	Fifth Supplemental Indenture dated as of July 31, 2002 to the Indenture Dated as of April 1, 1998 among the Registrant, certain of its subsidiaries and SunTrust Bank (formerly SunTrust Bank, Central Florida, National Association), as Notes Trustee, relating to the Company’s $110 million aggregate principal amount of 10½% Senior Secured Notes due 2008 (incorporated by reference to exhibit of same designation to Transition Report on Form 10-KT for the nine months ended December 31, 2002).

4.13	-	Sixth Supplemental Indenture dated as of April 30, 2003 to the Indenture Dated as of April 1, 1998 among the Registrant, certain of its subsidiaries and the SunTrust Bank (formerly SunTrust Bank, Central Florida, National Association), as Notes Trustee, relating to the Company’s $110 million aggregate principal amount of 10½% Senior Secured Notes due 2008 (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated June 30, 2003).

4.14	-	Seventh Supplemental Indenture dated as of February 29, 2004 to the Indenture Dated as of April 1, 1998 among the Registrant, certain of its subsidiaries and SunTrust Bank (formerly SunTrust Bank, Central Florida, National Association), as Notes Trustee, relating to the Company’s $110 million aggregate principal amount of 10½% Senior Secured Notes due 2008 (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated June 30, 2004).

4.15	-	Eighth Supplemental Indenture dated as of March 31, 2006 to the Indenture Dated as of April 1, 1998 among the Registrant, certain of its subsidiaries and SunTrust Bank (formerly SunTrust Bank, Central Florida, National Association), as Notes Trustee, relating to the Company’s $110 million aggregate principal amount of 10½% Senior Secured Notes due 2008. (incorporated by reference to exhibit of same designation to Annual Report on Form 10-K dated December 31, 2006).

4.16	-	Exchange and Registration Rights Agreement dated April 1, 1998, by and among the Registrant and the persons named therein, relating to the 10½% Senior Secured Notes due 2008 (incorporated by reference to exhibit 10.123 to Registration Statement on Form S-4, File No. 333-50717).

4.17	-	Specimen of Common Stock Certificate.

10.1	-	Amended and Restated Trust Agreement among Bluegreen Corporation, as Depositor, JPMorgan Chase Bank, National Association as Property Trustee, Chase Bank USA, National Association, as Delaware Trustee and the Administrative Trustees Named Herein as Administrative Trustees dated as of March 15, 2005 (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated March 31, 2005).

10.2	-	Junior Subordinated Indenture between Bluegreen Corporation and JPMorgan Chase Bank, National Association, as Trustee dated as of March 15, 2005 (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated March 31, 2005).

10.3	-	Amended and Restated Trust Agreement among Bluegreen Corporation, as Depositor, Wilmington Trust Company, as Property Trustee, Wilmington Trust Company, as Delaware Trustee and the Administrative Trustees Named Herein as Administrative Trustees dated as of May 4, 2005 (incorporated by reference to exhibit of same designation

118


		to Quarterly Report on Form 10-Q dated March 31, 2005).

10.4	-	Junior Subordinated Indenture between Bluegreen Corporation and Wilmington Trust Company as Trustee dated as of May 4, 2005 (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated March 31, 2005).

10.5	-	Amended and Restated Trust Agreement among Bluegreen Corporation, as Depositor, Wilmington Trust Company, as Property Trustee, Wilmington Trust Company, as Delaware Trustee and the Administrative Trustees, dated as of May 10, 2005 (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated June 30, 2005).

10.6	-	Junior Subordinated Indenture between Bluegreen Corporation and Wilmington Trust Company, as Trustee dated as of May 10, 2005 (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated June 30, 2005).

10.7	-	Amended and Restated Trust Agreement among Bluegreen Corporation as Depositor, Wilmington Trust Company as Property Trustee and Delaware Trustee, and various Administrative Trustees, dated as of February 26, 2007 (Bluegreen Statutory Trust VI). (incorporated by reference to exhibit of same designation to Current Report on Form 8-K dated March 1, 2007).

10.8	-	Junior Subordinated Indenture between Bluegreen Corporation and Wilmington Trust Company as Trustee, dated as of February 26, 2007. (incorporated by reference to exhibit of same designation to Current Report on Form 8-K dated March 1, 2007).

10.9	-	Amended and Restated Trust Agreement among Bluegreen Corporation as depositor, Wilmington Trust Company as Property Trustee and Delaware Trustee and various Administrative Trustees, dated April 24, 2006 (Bluegreen Statutory Trust IV). (incorporated by reference to Exhibit 10.61 to Quarterly Report on Form 10-Q dated March 31, 2006).

10.10	-	Junior Subordinated Indenture between Bluegreen Corporation and Wilmington Trust Company as Trustee dated as of April 24, 2006. (incorporated by reference to Exhibit 10.62 to Quarterly Report on Form 10-Q dated March 31, 2006).

10.11	-	Trust Agreement of Bluegreen Statutory Trust V among Bluegreen Corporation as Depositor, Wilmington Trust Company as Trustee and Property Trustee, dated as of July 19, 2006. (incorporated by reference to Exhibit 10.63 to Quarterly Report on Form 10-Q dated June 30, 2006).

10.12	-	Amended and Restated Trust Agreement among Bluegreen Corporation as Depositor, Wilmington Trust Company as Property Trustee and Delaware Trustee, and various Administrative Trustees, dated as of July 21, 2006 (Bluegreen Statutory Trust V). (incorporated by reference to Exhibit 10.64 to Quarterly Report on Form 10-Q dated June 30, 2006).

10.13	-	Junior Subordinated Indenture between Bluegreen Corporation and Wilmington Trust Company as Trustee, dated as of July 21, 2006. (incorporated by reference to Exhibit 10.65 to Quarterly Report on Form 10-Q dated June 30, 2006).

10.14	-	Amended and Restated Trust Agreement among Bluegreen Corporation as Depositor, Wilmington Trust Company as Property Trustee and Delaware Trustee, and various Administrative Trustees, dated as of February 26, 2007 (Bluegreen Statutory Trust VI). (incorporated by reference to Exhibit 10.7 to Current Report on Form 8-K dated March 3, 2007).

10.15	-	Junior Subordinated Indenture between Bluegreen Corporation and Wilmington Trust Company as Trustee, dated as of February 26, 2007. (incorporated by reference to Exhibit

119


		10.8 Current Report on Form 8-K dated March 3, 2007).

10.79*	-	Registrant’s 1998 Non-Employee Director Stock Option Plan (incorporated by reference to exhibit 10.131 to Annual report on Form 10-K for the year ended March 29, 1998).

10.80*	-	Registrant’s 1995 Stock Incentive Plan, as amended (incorporated by reference to exhibit 10.79 to Annual Report on Form 10-K for the fiscal year ended March 29, 1998).

10.81*	-	Registrant’s 2005 Stock Incentive Plan* (incorporated by reference to exhibit 10.2010 to Quarterly Report on Form 10-Q dated June 30, 2005).

10.82*	-	Registrant’s Retirement Savings Plan (incorporated by reference to exhibit 10.81 to Annual Report on Form 10-K for the fiscal year ended March 31, 2002).

10.83*	-	Mandatory Distribution Amendment to Registrants’ Retirement Savings Plan dated as March 28, 2005. (incorporated by reference to exhibit 10.82 to Quarterly Report on Form 10-Q dated March 31, 2006).

10.87	-	Loan and Security Agreement, dated April 16, 2007 among Bluegreen/Big Cedar Vacations, LLC, as borrower and General Electric Capital Corporation, as Lender (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated March 31, 2007).

10.88	-	Revolving Promissory Note, dated April 16, 2007 from Bluegreen/Big Cedar Vacations, LLC, as borrower to General Electric Capital Corporation, as Lender (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated March 31, 2007).

10.136 *	-	Employment Letter Agreement, dated April 25, 2007, by and between Bluegreen Corporation and David L. Pontius (incorporated by reference to exhibit 10.150 to Quarterly Report on Form 10-Q dated March 31, 2007).

10.135*	-	Employment Agreement between George F. Donovan and the Company dated December 31, 2006. (incorporated by reference to exhibit of same designation to Annual Report on Form 10-K dated December 31, 2006).

10.137*	-	Employment Agreement between Bluegreen Corporation and George F. Donovan, dated as of June 28, 2006. (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated June 30, 2006).

10.139	-	Amended and Restated Loan and Security Agreement dated as of September 23, 1997 between Foothill Capital Corporation and the Registrant (incorporated by reference to exhibit 10.130 to Registration Statement on Form S-4, File No. 333-50717).

10.140	-	Amendment Number One to Loan and Security Agreement dated December 1, 2000, by and between the Registrant and Foothill Capital Corporation (incorporated by reference to exhibit 10.140 to Quarterly Report on Form 10-Q dated December 31, 2000).

10.141	-	Amendment Number Two to Loan and Security Agreement dated as of November 9, 2001, by and between the Registrant and Foothill Capital Corporation (incorporated by reference to exhibit 10.133 to Quarterly Report on Form 10-Q dated December 31, 2001).

10.142	-	Amendment Number Three to Loan and Security Agreement dated August 28, 2002, by and between the Registrant and Foothill Capital Corporation (incorporated by reference to exhibit 10.132 to Quarterly Report on Form 10-Q dated September 29, 2002).

10.143	-	Amendment Number Four to Loan and Security Agreement dated March 26, 2003, by and

120


		between the Registrant and Foothill Capital Corporation (incorporated by reference to exhibit of same designation to Annual Report on Form 10-K for the fiscal year ended December 31, 2003).

10.144	-	Amendment Number Five to Loan and Security Agreement dated September 1, 2003, by and between the Registrant and Wells Fargo Foothill, Inc. (f/k/a Foothill Capital Corporation) (incorporated by reference to exhibit of same designation to Annual Report on Form 10-K for the fiscal year ended December 31, 2003).

10.145	-	Amendment Number Six to Loan and Security Agreement dated April 2, 2004 by and between the Registrant and Wells Fargo Foothill, Inc. (f/k/a Foothill Capital Corporation) (Incorporated by reference to exhibit of same designation to Annual Report on Form 10-K dated December 31, 2004).

10.146	-	Amendment Number Seven to Loan and Security Agreement dated September 21, 2004 by and between the Registrant and Wells Fargo Foothill, Inc. (f/k/a Foothill Capital Corporation). (incorporated by reference to exhibit 10.140 to Quarterly Report on Form 10-Q dated December 31, 2000). (Incorporated by reference to exhibit of same designation to Annual Report on Form 10-K dated December 31, 2004).

10.147	-	Amendment Number Eight to Loan and Security Agreement dated October 5, 2004 by and between the Registrant and Wells Fargo Foothill, Inc. (f/k/a Foothill Capital Corporation). (Incorporated by reference to exhibit of same designation to Annual Report on Form 10-K dated December 31, 2004).

10.148	-	Amendment Number Nine to Loan and Security Agreement dated December 23, 2004 by and between the Registrant and Wells Fargo Foothill, Inc. (f/k/a Foothill Capital Corporation). (Incorporated by reference to exhibit of same designation to Annual Report on Form 10-K dated December 31, 2004).

10.149	-	Promissory Note dated March 26, 2003, by and between the Registrant and Foothill Corporation (incorporated by reference to exhibit 10.134 to Quarterly Report on Form 10-Q dated March 31, 2003). (Incorporated by reference to exhibit of same designation to Annual Report on Form 10-K dated December 31, 2004).

10.156	-	Loan Agreement dated as of September 25, 2002, between Bluegreen Corporation of the Rockies, Bluegreen Golf Clubs, Inc., Bluegreen Properties of Virginia, Inc., Bluegreen Southwest One, L.P. and Residential Funding Corporation (incorporated by reference to exhibit 10.149 to Current Report on Form 8-K dated September 25, 2002).

10.157	-	Revolving Promissory Note dated as of September 25, 2002, between Bluegreen Corporation of the Rockies, Bluegreen Golf Clubs, Inc., Bluegreen Properties of Virginia, Inc., Bluegreen Southwest One, L.P. and Residential Funding Corporation (incorporated by reference to exhibit 10.150 to Current Report on Form 8-K dated September 25, 2002).

10.150 *	-	Employment Letter Agreement, dated April 25, 2007, by and between Bluegreen Corporation and David L. Pontius (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated March 31, 2007).

10.160	-	Third Amendment to Loan Agreement and Other Loan Documents, dated October 21, 2005 between Bluegreen Corporation of the Rockies, Bluegreen Golf Clubs, Inc., Bluegreen Properties of Virginia, Inc., Bluegreen Southwest One, L.P., Catawba Falls, LLC, and RFC Construction Funding Corp., as successor in interest to and assignee of Residential Funding Corporation. (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated March 31, 2006).

10.163	-	Loan Agreement dated February 10, 2003, between Bluegreen Vacations Unlimited, Inc. and Residential Funding Corporation (incorporated by reference to exhibit 10.155 to Transition Report on Form 10-KT for the nine months ended December 31, 2002).

121


10.164	-	Modification Agreement (AD&C Loan Agreement) dated September 10, 2003, between Bluegreen Vacations Unlimited, Inc. and Residential Funding Corporation (incorporated by reference to exhibit of same designation to Annual Report on Form 10-K for the fiscal year ended December 31, 2003).

10.165	-	Revolving Promissory Note (AD&C Loan) dated February 10, 2003, between Bluegreen Vacations Unlimited, Inc. and Residential Funding Corporation (incorporated by reference to exhibit 10.156 to Transition Report on Form 10-KT for the nine months ended December 31, 2002).

10.166	-	Amendment No. 1 to Revolving Promissory Note (AD&C Loan) dated as of September 10, 2003 between Bluegreen Vacations Unlimited, Inc. and Residential Funding Corporation (incorporated by reference to exhibit 10.157 to Quarterly Report on Form 10-Q dated September 30, 2003).

10.167	-	Amendment No. 2 to Revolving Promissory Note (AD&C Loan) dated as of September 15, 2004 between Bluegreen Vacations Unlimited, Inc. and Residential Funding Corporation (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated September 30, 2004).

10.168	-	Loan and Security Agreement dated February 10, 2003, between the Registrant, Residential Funding Corporation, Bluegreen Vacations Unlimited, Inc. and Bluegreen/Big Cedar Vacations, LLC (incorporated by reference to exhibit 10.157 to Transition Report on Form 10-KT for the nine months ended December 31, 2002).

10.169	-	Modification Agreement (Receivables Loan and Security Agreement) dated September 10, 2003, between the Registrant, Residential Funding Corporation, Bluegreen Vacations Unlimited, Inc. and Bluegreen/Big Cedar Vacations, LLC (incorporated by reference to exhibit 10.168 to Annual Report on Form 10-K for the fiscal year ended December 31, 2003).

10.170	-	Second Modification Agreement (Receivables Loan and Security Agreement) dated September 15, 2004, between the Registrant, Residential Funding Corporation, Bluegreen Vacations Unlimited, Inc. and Bluegreen/Big Cedar Vacations, LLC.

10.172	-	Revolving Promissory Note (Receivables Loan) dated February 10, 2003, between the Registrant, Residential Funding Corporation, Bluegreen Vacations Unlimited, Inc. and Bluegreen/Big Cedar Vacations, LLC (incorporated by reference to exhibit 10.158 to Transition Report on Form 10-KT for the nine months ended December 31, 2002).

10.173	-	Amendment No. 1 to Revolving Promissory Note (Receivables Loan) dated as of September 10, 2003 between Bluegreen Corporation, Bluegreen Vacations Unlimited, Inc., Bluegreen/Big Cedar Vacations, LLC and Residential Funding Corporation (incorporated by reference to exhibit 10.160 to Quarterly Report on Form 10-Q dated September 30, 2003).

10.174	-	Full Guaranty dated February 10, 2003, by the Registrant in favor of Residential Funding Corporation (incorporated by reference to exhibit 10.159 to Transition Report on Form 10-KT for the nine months ended December 31, 2002).

10.175	-	Third Modification Agreement (Receivables Loan and Security Agreement dated February 15 ^th , 2006 between Bluegreen Vacations Unlimited, Inc. and Residential Funding Corporation. (incorporated by reference to exhibit 10.176 to Quarterly Report on Form 10-Q dated March 31, 2006).

10.176	-	Third Modification Agreement (AD&C Loan) dated February 15 ^th , 2006, between Bluegreen Vacations Unlimited, Inc. and Residential Funding Corporation. (incorporated by reference to exhibit 10.175 to Quarterly Report on Form 10-Q dated March 31, 2006).

10.177	-	Sixth Amended and Restated Loan Agreement, dated August 8, 2007 by and among the

122


		Registrant, certain subsidiaries of the Registrant and Wachovia Bank, N.A., for $20 million, unsecured, revolving line-of-credit due June 30, 2007.

10.178	-	Loan Agreement dated December 19, 2007 by and between Bluegreen Vacations Unlimited, Inc. and Wachovia Bank, NA for $12.08 million.

10.180	-	BXG Receivables Owner Trust 2006-A Definition Annex, Definitions and Interpretations, dated as of March 13, 2006. (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated March 31, 2006).

10.182	-	Indenture between BXG Receivables Owner Trust 2006-A and U.S. Bank National Association, dated as of March 13, 2006. (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated March 31, 2006).

10.183	-	Sale and Servicing Agreement among BXG Receivables Owner Trust 2006-A, Bluegreen Receivables Finance Corporation XI, the Trust Depositor, Concord Servicing Corporation, Vacation Trust, Inc., U.S. Bank National Association and General Electric Capital Corporation dated March 13, 2006. (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated March 31, 2006).

10.184		Receivables Note Trust 2007-A, Standard Definitions, dated as of September 15, 2007 (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated September 30, 2007).

10.185		Indenture between BXG Receivables Note Trust 2007-A as Issuer, Bluegreen Corporation as Servicer, Vacation Trust, Inc. as Club Trustee, Concord Servicing Corporation as Backup Servicer and U.S. Bank National Association, as Indenture Trustee, Paying Agent and Custodian dated September 15, 2007 (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated September 30, 2007).

10.186		Sale Agreement by and among BRF Corporation 2007-A, as the Depositor and BXG Receivables Note Trust 2007-A as the Issuer dated September 15, 2007 (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated September 30, 2007).

10.187		Transfer Agreement by and among Bluegreen Corporation, BXG Timeshare Trust I as the Seller, and BRF Corporation 2007-A as the Depositor, dated September 15, 2007 (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated September 30, 2007).

10.188		Purchase and Contribution Agreement by and among Bluegreen Corporation and BRF Corporation 2007-A, dated September 15, 2007 (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated September 30, 2007).

10.189		BXG Receivables Note Trust 2006-B, Standard Definitions, dated as of September 15, 2006 (incorporated by reference to exhibit 10.185 to Quarterly Report on Form 10-Q dated September 30, 2006).

10.190		Indenture between BXG Receivables Note Trust 2006-B as Issuer, Bluegreen Corporation as Servicer, Vacation Trust, Inc. as Club Trustee, Concord Servicing Corporation as Backup Servicer and U.S. Bank National Association, as Indenture Trustee, Paying Agent and Custodian dated September 15, 2006 (incorporated by reference to exhibit 10.186 to Quarterly Report on Form 10-Q dated September 30, 2006).

10.191		Sale Agreement by and among Bluegreen Receivables Finance Corporation XII, as the Depositor and BXG Receivables Note Trust 2006-B as the Issuer dated September 15, 2006 (incorporated by reference to exhibit 10.187 to Quarterly Report on Form 10-Q dated September 30, 2006).

123


10.192		Transfer Agreement by and among Bluegreen Corporation, BXG Timeshare Trust I as the Seller, and Bluegreen Receivables Finance Corporation XII as the Depositor, dated September 15, 2006 (incorporated by reference to exhibit 10.188 to Quarterly Report on Form 10-Q dated September 30, 2006).

10.193		Purchase and Contribution Agreement by and among Bluegreen Corporation and Bluegreen Receivables Finance Corporation XII, dated September 15, 2006 (incorporated by reference to exhibit 10.189 to Quarterly Report on Form 10-Q dated September 30, 2006).

10.211	-	Purchase and Contribution Agreement, dated as of May 1, 2006 by and among Bluegreen Corporation as Seller, and Bluegreen Timeshare Finance Corporation I as Depositor (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated June 30, 2006).

10.212	-	Indenture dated May 1, 2006 between BXG Timeshare Trust I as Issuer, Bluegreen Corporation as Servicer, Vacation Trust, Inc. as Club Trustee, Concord Servicing Corporation as Backup Servicer, US Bank, N.A. as Indenture Trustee, Paying Agent and Custodian, and Branch Banking and Trust Company as Agent. (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated June 30, 2006).

10.213	-	Sale Agreement dated May 1, 2006, among Bluegreen Timeshare Finance Corporation I as Depositor and BXG Timeshare Trust I as Issuer. (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated June 30, 2006).

10.214	-	Note Funding Agreement dated May 1, 2006 among BXG Timeshare Trust I as Issuer, Bluegreen Corporation as Seller and Servicer, Bluegreen Timeshare Finance Corporation I as Depositor, various Purchaser Parties, and Branch Banking and Trust Company as Agent. (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated June 30, 2006).

10.215	-	Standard Definitions to Indenture dated May 1, 2006 between BXG Timeshare Trust I as Issuer, Bluegreen Corporation as Servicer, Vacation Trust, Inc. as Club Trustee, Concord Servicing Corporation as Backup Servicer, US Bank, N.A. as Indenture Trustee, Paying Agent and Custodian, and Branch Banking and Trust Company as Agent. (incorporated by reference to exhibit of same designation to Quarterly Report on Form 10-Q dated June 30, 2006).

10.301	-	Amended and Restated Operating Agreement of Bluegreen/Big Cedar Vacations, LLC as of December 31, 2007.

10.302	-	Amended and Restated Marketing and Promotions Agreement by and among Bass Pro and affiliates and Bluegreen and affiliates, as of December 31, 2007.

10.303	-	Amended and Restated Administrative Services Agreement dated as of December 31, 2006 by and among Bluegreen/Big Cedar Vacations, LLC and Bluegreen Vacations Unlimited, Inc. and Big Cedar LLC.

10.304	-	Amended and Restated Servicing Agreement dated as of December 31, 2006 by and among the Registrant, Bluegreen/Big Cedar Vacations, LLC and Big Cedar LLC.

10.305	-	Contribution Agreement dated as of June 16, 2000 by and between Bluegreen Vacations Unlimited, Inc. and Big Cedar LLC (incorporated by reference to exhibit 10.204 to Quarterly Report on Form 10-Q dated July 2, 2000).

18	-	Letter re: Change in Accounting Principle (incorporated by reference to exhibit of same designation to Transition Report on Form 10-KT for the nine months ended December 31, 2002).

124


21.1	-	List of Subsidiaries.

23.1	-	Consent of Independent Registered Public Accounting Firm.

31.1	-	Certification of John M. Maloney, Jr., President and Chief Executive Officer, pursuant to Securities Exchange Act Rules 13a-15(c) and 15d-15(c), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2	-	Certification of Anthony M. Puleo, Senior Vice President, Chief Financial Officer and Treasurer, pursuant to Securities Exchange Act Rules 13a-15(c) and 15d-15(c), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1	-	Certification of John M. Maloney, Jr., President and Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2	-	Certification of Anthony M. Puleo, Senior Vice President, Chief Financial Officer and Treasurer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

* - Compensation plan or arrangement

125

COMMON STOCK

Par Value One Cent

BLUEGREEN CORPORATION

INCORPORATED UNDER THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS

This Certificate is Transferable in Jersey City, NJ or New York, NY

This Certifies that

is the owner of

FULLY PAID AND NONASSESSABLE SHARES OF COMMON STOCK OF

CUSIP 096231 10 5

SEE REVERSE FOR CERTAIN DEFINITIONS

Dated:

COUNTERSIGNED AND REGISTERED:

MELLON INVESTOR SERVICES LLC

TRANSFER AGENT AND REGISTRAR

AUTHORIZED SIGNATURE

TREASURER AND CHIEF FINANCIAL OFFICER

NUMBER

BXG 2539

SHARES

BLUEGREEN CORPORATION

This certificate also evidences and entitles the holder hereof to certain rights as set forth in a Rights Agreement between Bluegreen Corporation and Mellon Investor Services LLC, dated as of July 27, 2006, as it may be amended or supplemented from time to time (the “Agreement”), the terms of which are hereby incorporated herein by reference and a copy of which is on file at the principal executive offices of Bluegreen Corporation. Under certain circumstances, as set forth in the Agreement, such Rights (as defined in the Agreement) will be evidenced by separate certificates and will no longer be evidenced by this certificate. Bluegreen Corporation will mail to the holder of this certificate a copy of the Agreement without charge after receipt of a written request therefor. As set forth in the Agreement, Rights beneficially owned by any Person (as defined in the Agreement) who becomes an Acquiring Person (as defined in the Agreement) become null and void.

The Corporation is authorized to issue Preferred Stock and Common Stock. The Preferred Stock may be divided into and issued in one or more series, having such preferences, voting powers, qualifications and special and relative rights as may be established by the Board of Directors from time to time. The Corporation will furnish to the holder hereof upon written request and without charge a copy of the full text, as set-forth in the Corporation’s Articles of Organization, of the preferences, voting powers, qualifications and special and relative rights of the shares of each class (and each series of a class, if any) of its capital stock authorized to be issued as of the date of such request. Requests for copies should be directed to the Corporation at its principal office.

The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations:


TEN COM	-	as tenants in common	UNIF GIFT MIN ACT-	Custodian
TEN ENT	-	as tenants by the entireties
JT TEN	-	as joint tenants with right of survivorship and not as tenants in common		(Cust)		(Minor)

					under Uniform Gifts to Minors Act

					(State)

Additional abbreviations may also be used though not in the above list.

ASSIGNMENT

For value received, ______________________________________________ hereby sell assign and transfer unto


PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE

PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE


	Shares of

the capital stock represented by the within Certificate, and do hereby irrevocably constitute and appoint


	Attorney to

transfer the said stock on the books of the within-named Corporation with full power of substitution in the premises.


Dated,		Sign Here:

		NOTICE: The signature on this assignment must correspond with the name as written upon the face of the Certificate, in every particular, without alteration or enlargement, or any change whatever.


Signature(s) Guaranteed:


THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17 Ad-15.

SIXTH AMENDED AND RESTATED LOAN AGREEMENT

Wachovia Bank, National Association
225 Water Street
Jacksonville, Florida 32202
(Hereinafter referred to as the “Bank”)

Bluegreen Corporation, a Massachusetts corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33341
(Hereinafter referred to as “Bluegreen Corporation”)

Bluegreen Resorts Management, Inc., a Delaware corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Vacations Unlimited, Inc., a Florida corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Holding Corporation (Texas), a Delaware corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Southwest One, L.P., a Delaware limited partnership
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Asset Management Corporation, a Delaware corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Carolina Lands, LLC, a Delaware limited liability company
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Corporation of Tennessee, a Delaware corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Corporation of the Rockies, a Delaware corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Properties of Virginia, Inc., a Delaware corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Resorts International, Inc., a Delaware corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Carolina National Golf Club, Inc., a North Carolina corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Leisure Capital Corporation, a Vermont corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen West Corporation, a Delaware corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Golf Clubs, Inc., a Delaware corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Interiors, LLC, a Delaware limited liability company
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Southwest Land, Inc., a Delaware corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

New England Advertising Corporation, a Vermont corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Guaranty Corporation, a Florida corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Jordan Lake Preserve Corporation, a North Carolina corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Leisure Communication Network, Inc., a Delaware corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Managed Assets Corporation, a Delaware corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

travelheads, inc., a Florida corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Encore Rewards, Inc., a Delaware corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Leisurepath, Inc., a Florida corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Page 2

BXG Realty, Inc., a Delaware corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Texas Homesite Realty, Inc., a Texas corporation
f/k/a Mystic Shores Realty, Inc.
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Brickshire Realty, Inc., a Virginia corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Catawba Falls, LLC, a North Carolina limited liability company
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Preserve at Jordan Lake Realty, Inc., a North Carolina corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Purchasing & Design, Inc., a Florida corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Great Vacation Destinations, Inc., a Florida corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Lake Ridge Realty, Inc., a Texas corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Communities of Texas, L.P., a Delaware limited partnership
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Pinnacle Vacations, Inc., a Delaware corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Communities of Georgia, LLC, a Georgia limited liability company
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Communities of Georgia Realty, Inc., a Georgia corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

BXG Realty Tenn, Inc., a Tennessee corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Page 3

Bentwater Realty, Inc., a Texas corporation
f/k/a Mountain Lakes Realty, Inc.
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Nevada, LLC, a Delaware limited liability company
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Family Fun Company, LLC, a Delaware limited liability company
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

BXG Mineral Holdings, LLC, a Delaware limited liability company
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Texas Hill Country Realty, Inc., a Texas corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

BXG Construction, LLC, a Delaware limited liability company
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

Bluegreen Communities of Houston - I, LLC, a Delaware limited liability company
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431

BXG Acquisition Corp., a Delaware corporation
4960 Conference Way North, Suite 100
Boca Raton, Florida 33431
(Individually and/or collectively, jointly and severally the “Borrower”)

This Sixth Amended and Restated Loan Agreement (“Agreement”) is entered into as of August 8, 2007.

Borrower requested and First Union National Bank (“First Union”) made that certain $5,000,000.00 line of credit available to Borrower (the “Loan”) as evidenced by that certain Promissory Note dated as of September 23, 1998 and certain other documents including that certain Loan Agreement dated as of September 23, 1998. The Loan has been previously amended, increased and extended pursuant to the terms and conditions of certain documents including, without limitation, that certain $10,000,000.00 Renewal Promissory Note dated as of December 31, 2000, that certain Modification Number One to the Loan Agreement dated as of August 1, 1999, that certain Modification Number Two to Loan Agreement dated as of November 3, 1999, that certain Modification Number Three to Loan Agreement dated as of December 31, 2000, and certain other documents.

Borrower subsequently requested and First Union agreed to amend, increase and extend the Loan as evidenced by (i) that certain Amended and Restated Promissory Note executed by Borrower, jointly and severally, dated as of December 31, 2001, and made payable to First Union in the original principal amount of $12,500,000.00; (ii) that certain Amended and Restated Loan Agreement dated as of December 31, 2001; and (iii) certain other loan documents dated as of December 31, 2001.

Borrower subsequently requested and Bank (successor by merger to First Union) agreed to amend and extend the Loan as evidenced by (i) that certain Second Amended and Restated Promissory Note executed by Borrower, jointly and severally, dated as of December 31, 2002, and made payable to Bank

Page 4

in the original principal amount of $12,500,000.00; (ii) that certain Second Amended and Restated Loan Agreement dated as of December 31, 2002; and (iii) certain other loan documents dated as of December 31, 2002.

Borrower subsequently requested and Bank agreed to further amend, increase and extend the Loan pursuant to the terms of (i) that certain Third Amended and Restated Promissory Note executed by Borrower, jointly and severally, dated as of December 30, 2003, and made payable to Bank in the original principal amount of $15,000,000.00, and (ii) that certain Third Amended and Restated Loan Agreement dated as of December 30, 2003.

Borrower subsequently requested, and Bank agreed to further amend the Loan, as evidenced by that certain First Amendment and Ratification of Loan Agreement dated as of March 31, 2004, and as evidenced by that certain Second Amendment and Ratification of Loan Agreement dated as of August 9, 2004.

Borrower subsequently requested and Bank agreed to further modify and extend the Loan pursuant to the terms of (i) that certain Fourth Amended and Restated Promissory Note executed by Borrower, jointly and severally, dated as of December 31, 2004, and made payable to the Bank in the original principal amount of $15,000,000.00, and (ii) that certain Fourth Amended and Restated Loan Agreement dated as of December 31, 2004.

Borrower subsequently requested and Bank agreed to further modify and extend the Loan pursuant to the terms of (i) that certain Fifth Amended and Restated Promissory Note executed by Borrower, jointly and severally, dated as of July 26, 2006, and made payable to the Bank in the original principal amount of $15,000,000.00 (the “Note”), and (ii) that certain Fifth Amended and Restated Loan Agreement dated as of July 26, 2006.

Borrower has now requested and Bank has agreed to further modify, increase and extend the Loan pursuant to the terms of (i) that certain Sixth Amended and Restated Promissory Note executed by Borrower, jointly and severally, dated of even date herewith, and made payable to the Bank in the original principal amount of $20,000,000.00 (the “Note”), and (ii) this Agreement. The Note, and this Agreement and all other documents executed in connection with the Loan are hereinafter collectively referred to as the “Loan Documents”. All capitalized terms used herein and not otherwise defined shall have those meanings ascribed to them in the Loan Documents.

LINE OF CREDIT. Borrower may borrow, repay, and reborrow, from time to time, so long as the total principal indebtedness outstanding under the Loan plus the amount of all unreimbursed drawings under all letters of credit issued by Bank for account of Borrower does not exceed the face amount of the Note. All payments made by Bank under any letters of credit issued for the account of Borrower and all fees, commissions, discounts and other amounts owed or to be owed to Bank in connection therewith, shall be deemed to be Advances under the Note and shall be repaid as provided herein and in the Note. The Loan proceeds are to be used by Borrower solely for working capital and to issue letters of credit from time to time. The Borrower shall pay down the outstanding balance under the Loan (excluding letters of credit issued under the Note) to a maximum of $1,000.00 for forty-five (45) consecutive days annually. The total amount of letters of credit to be issued under the Note shall not exceed $10,000,000.00 in the aggregate at any time nor have maturities greater than the maturity date of the Loan. The maturity date of the Loan shall be June 30, 2009.

Letter of Credit Fees. Borrower shall pay to Bank, at such times as Bank shall require, Bank’s standard fees in connection with Letters of Credit, as in effect from time to time, and with respect to standby Letters of Credit, an additional fee equal to 1.50% per annum on the face amount of each standby Letter of Credit, payable annually, in advance, for so long as such Letter of Credit is outstanding.

Representations. Except as otherwise provided herein, Borrower represents that from the date of this Agreement and until final payment in full of the Obligations: Accurate Information. All information now and hereafter furnished to Bank is and will be true, correct and complete. Any such information relating to

Page 5

Borrower’s financial condition will accurately reflect Borrower’s financial condition as of the date(s) thereof, (including all contingent liabilities of every type), and Borrower further represents that its financial condition has not changed materially or adversely since the date(s) of such documents. Authorization; Non-Contravention. The execution, delivery and performance by Borrower of this Agreement and other Loan Documents to which it is a party are within its power, have been duly authorized as may be required and, if necessary, by making appropriate filings with any governmental agency or unit and are the legal, binding, valid and enforceable obligations of Borrower; and do not (i) contravene, or constitute (with or without the giving of notice or lapse of time or both) a violation of any provision of applicable law, a violation of the organizational documents of Borrower, or a default under any agreement, judgment, injunction, order, decree or other instrument binding upon or affecting Borrower, (ii) result in the creation or imposition of any lien (other than the lien(s) created by the Loan Documents) on any of Borrower’s assets, or (iii) give cause for the acceleration of any obligations of Borrower or any guarantor to any other creditor. Asset Ownership. As of the date of this Agreement, Borrower has good and marketable title to all of the properties and assets reflected on the balance sheets and financial statements supplied Bank by Borrower, and all such properties and assets are free and clear of mortgages, security deeds, pledges, liens, charges, and all other encumbrances, except as otherwise disclosed in such financial statements (“Permitted Liens”). To Borrower’s knowledge, no default has occurred under any Permitted Liens and no claims or interests adverse to Borrower’s present rights in its properties and assets have arisen. Discharge of Liens and Taxes. Borrower has duly filed, paid and/or discharged all taxes or other claims which may become a lien on any of its property or assets to the extent required to be paid as of this date, except to the extent that such items are being appropriately contested in good faith and an adequate reserve for the payment thereof is being maintained if required by generally accepted accounting principles. Sufficiency of Capital. Borrower is not, and after consummation of this Agreement and after giving effect to all indebtedness incurred and liens created by Borrower in connection with the Note and any other Loan Documents, will not be, insolvent within the meaning of 11 U.S.C. § 101(32). Compliance with Laws. Borrower is in compliance in all material respects with all federal, state and local laws, rules and regulations applicable to its properties, operations, business, and finances, including, without limitation, any federal or state laws relating to liquor (including 18 U.S.C. § 3617, et seq.) or narcotics (including 21 U.S.C. § 801, et seq.) and/or any commercial crimes; all applicable federal, state and local laws and regulations intended to protect the environment; and the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), if applicable. Organization and Authority. Each Borrower is duly created, validly existing and in good standing under the laws of the state of its organization, and has all powers, governmental licenses, authorizations, consents and approvals required to operate its business as now conducted. Each Borrower is duly qualified, licensed and in good standing in each jurisdiction where qualification or licensing is required by the nature of its business or the character and location of its property, business or customers, and in which the failure to so qualify or be licensed, as the case may be, in the aggregate, could have a material adverse effect on the business, financial position, results of operations, properties or prospects of Borrower or any such guarantor. No Litigation. There are no pending suits, claims or demands or any threatened suits, claims or demands (which threatened suits, claims or demands have a reasonable likelihood of becoming a suit, claim or demand), against Borrower or any guarantor, and which could reasonably be expected to have a material adverse effect on Borrower’s or guarantor’s business, that have not been disclosed in Borrower’s periodic filings with the Securities and Exchange Commission (“SEC”), or otherwise disclosed to Bank in writing and approved by Bank. ERISA. Each employee pension benefit plan, as defined in ERISA, maintained by Borrower meets, as of the date hereof, the minimum funding standards of ERISA and all applicable regulations thereto and requirements thereof, and of the Internal Revenue Code of 1954, as amended. No “Prohibited Transaction” or “Reportable Event” (as both terms are defined by ERISA) has occurred with respect to any such plan.

AFFIRMATIVE COVENANTS. Borrower agrees that from the date hereof and until final payment in full of the Obligations, unless Bank shall otherwise consent in writing, Borrower will: Business Continuity. Conduct its business in substantially the same manner as such business is now and has previously been conducted. Maintain Properties. Maintain, preserve and keep its property in good repair, working order and condition, making all needed replacements, additions and improvements thereto, to the extent allowed by this Agreement. Access to Books and Records. Allow Bank, or its agents, during normal business hours and upon prior advance written notice, access to the books, records and such other

Page 6

documents of Borrower as Bank shall reasonably require, and allow Bank to make copies thereof at Bank’s expense. Insurance . Maintain adequate insurance coverage with respect to its properties and business against loss or damage of the kinds and in the amounts customarily insured against by companies of established reputation engaged in the same or similar businesses including, without limitation, commercial general liability insurance, workers compensation insurance, and business interruption insurance; all acquired in such amounts and from such companies as Bank may reasonably require. Notice of Default and Other Notices. (a) Notice of Default. Furnish to Bank immediately upon becoming aware of the existence of any condition or event which constitutes a Default (as defined in the Loan Documents) or any event which, upon the giving of notice or lapse of time or both, may become a Default, written notice specifying the nature and period of existence thereof and the action which Borrower is taking or proposes to take with respect thereto. (b) Other Notices. Promptly notify Bank in writing of (i) any material adverse change in its financial condition or its business; (ii) any default under any material agreement, contract or other instrument to which it is a party or by which any of its properties are bound, or any acceleration of the maturity of any indebtedness owing by Borrower; (iii) any material adverse claim against or affecting Borrower or any part of its properties (Bank acknowledges that disclosure of all such matters in Borrower’s periodic filings with the SEC shall constitute prompt notice thereof to Bank); (iv) the commencement of, and any material determination in, any litigation with any third party or any proceeding before any governmental agency or unit affecting Borrower in a claimed amount in excess of $1,500,000.00 (Bank acknowledges that disclosure of all such matters in Borrower’s periodic filings with the SEC shall constitute prompt notice thereof to Bank); and (v) at least 30 days prior thereto, any change in Borrower’s name or address as shown above, and/or any material change in Borrower’s structure. Compliance with Other Agreements. Comply with all terms and conditions contained in this Agreement, and any other Loan Documents, and swap agreements, if applicable, as defined in the 11 U.S.C. § 101. Payment of Debts. Pay and discharge when due, and before subject to penalty or further charge, and otherwise satisfy before maturity or delinquency, all obligations, debts, taxes, and liabilities of whatever nature or amount, except those which Borrower in good faith disputes. Reports and Proxies. Deliver to Bank, promptly, a copy of all financial statements, reports, notices, and proxy statements, sent by Borrower to stockholders, and all regular or periodic reports required to be filed by Borrower with any governmental agency or authority, excluding federal, state and local tax returns, business license and registration reports and SEC filings on Form 8-K, unless reasonably requested in writing by Bank. Bank acknowledges that Borrower’s timely filings with the SEC using the EDGAR System will constitute prompt delivery to the Bank of such items. Other Financial Information. Deliver promptly such other information regarding the operation, business affairs, and financial condition of Borrower which Bank may reasonably request. Non-Default Certificate From Borrower. Deliver to Bank, with the Financial Statements required herein, a certificate signed by Borrower, if Borrower is an individual, or by a principal financial officer of Borrower warranting that no “Default as specified in the Loan Documents nor any event which, upon the giving of notice or lapse of time or both, would constitute such a Default, has occurred. Estoppel Certificate. Furnish, within 15 days after request by Bank, a written statement duly acknowledged of the amount due under the Loan and whether offsets or defenses exist against the Obligations.

Negative Covenants. Borrower agrees that from the date of this Agreement and until final payment in full of the Obligations, unless Bank shall otherwise consent in writing, Borrower will not: Default on Other Contracts or Obligations. Default on any material contract with or obligation when due to a third party or default in the performance of any obligation to a third party incurred for money borrowed in an amount in excess of $2,500,000.00, which default is not cured within any cure period applicable thereto. Judgment Entered. Permit the entry of any monetary judgment or the assessment against, the filing of any tax lien against, or the issuance of any writ of garnishment or attachment against any property of or debts due Borrower not dismissed or bonded within 30 days. Government Intervention. Permit the assertion or making of any seizure, vesting or intervention by or under authority of any government by which the management of Borrower or any guarantor is displaced of its authority in the conduct of its respective business or its such business is curtailed or materially impaired. Prepayment of Other Debt. Retire any long-term debt entered into prior to the date of this Agreement in advance of its legal obligation to do so other than in connection with refinancing; provided, however, so long as no principal or interest is then outstanding under the Loan and no Default exists, Borrower may retire any long-term debt entered into prior to the date of this Agreement in advance of its legal obligation to do so. Retire or Repurchase

Page 7

Capital Stock. Retire or otherwise acquire any of its capital stock, except as permitted by waiver letter from Bank to Borrower dated as of May 13, 1999 authorizing the repurchase of up to two million shares of capital stock under Borrower’s existing share repurchase program.

Financial Covenants. Borrower, on a consolidated basis, agrees to the following provisions from the date hereof until final payment in full of the Obligations, unless Bank shall otherwise consent in writing: Adjusted Total Liabilities to Adjusted Tangible Net Worth Ratio. Borrower shall, at all times, on a consolidated basis, maintain a ratio of Adjusted Total Liabilities to Adjusted Tangible Net Worth of not more than 2.25 to 1.00. For the purposes of this computation, (i) “Adjusted Total Liabilities” shall mean the sum of all liabilities of the Borrower, on a consolidated basis, including capitalized leases and all reserves for deferred taxes and other deferred sums appearing on the liabilities side of a balance sheet, and excluding deferred income, any non-recourse obligations backed by vacation ownership receivables, and debt fully subordinated to Bank on terms and conditions acceptable to Bank in its sole and absolute discretion, in accordance with generally accepted accounting principles applied on a consistent basis; and (ii) “Adjusted Tangible Net Worth” shall mean total assets minus Total Liabilities. For purposes of this computation, the aggregate amount of any intangible assets of Borrower including, without limitation, goodwill, franchises, licenses, patents, trademarks, trade names, copyrights, service marks, and brand names, shall be subtracted from total assets. “Total Liabilities” shall mean all liabilities of Borrower, including capitalized leases and all reserves for deferred taxes, and other deferred sums appearing on the liabilities side of a balance sheet and all obligations as lessee under off-balance sheet synthetic leases of Borrower, excluding debt fully subordinated to Bank on terms and conditions acceptable to Bank, all in accordance with generally accepted accounting principles applied on a consistent basis. Liquidity Requirement. Borrower shall, at all times, maintain unrestricted cash and unencumbered timeshare receivables of not less than $50,000,000.00 in the aggregate. Deposit Relationship . Bluegreen Corporation shall maintain its primary depository account with Bank. Compliance Certificate. Borrower shall furnish Bank with a quarterly covenant compliance certificate demonstrating Borrower’s compliance with the above Financial Covenants.

Annual Financial Statements. Bluegreen Corporation shall deliver to Bank, within 90 days after the close of each fiscal year, audited financial statements reflecting its operations during such fiscal year, including, without limitation, a balance sheet, profit and loss statement and statement of cash flows, with supporting schedules; all on a consolidated basis and in reasonable detail, prepared in conformity with generally accepted accounting principles, applied on a basis consistent with that of the preceding year. All such statements shall be compiled by an independent certified public accountant acceptable to Bank. The opinion of such independent certified public accountant shall not be acceptable to Bank if qualified due to any limitations in scope imposed by Bluegreen Corporation. Any other qualification of the opinion by the accountant shall render the acceptability of the financial statements subject to Bank’s approval. Notwithstanding the foregoing, any adverse, qualified or scope limitation with the Borrower’s audit opinion relative to Section 404 of the Sarbanes-Oxley Act of 2002 will not make an otherwise unqualified opinion on the financial statement audit unacceptable to Bank unless, in the Bank’s opinion, such adverse, qualified or scope limitation, is material in nature including, without limitation, calling into question the effectiveness of the Borrower’s internal control under such Section 404.

Periodic Financial Statements. Bluegreen Corporation shall deliver to Bank unaudited management-prepared quarterly financial statements including, without limitation, a balance sheet, profit and loss statement and statement of cash flows, with supporting schedules, as soon as available and in any event within 60 days after the close of each such period; all in reasonable detail and prepared in conformity with generally accepted accounting principles, applied on a basis consistent with that of the preceding year. Such statements shall be certified as to their correctness by a principal financial officer of Bluegreen Corporation.

Attorneys’ Fees. Borrower shall pay all of Bank’s reasonable expenses incurred to enforce or collect any of the Advances, including, without limitation, reasonable arbitration, attorneys’ and experts’ fees and expenses, whether incurred without the commencement of a suit, in any trial, arbitration, or administrative proceeding, or in any appellate or bankruptcy proceeding.

Page 8

Waivers. Except as otherwise permitted in the Note or other Loan Documents, Borrower hereby waives presentment, protest, notice of dishonor, demand for payment, notice of intention to accelerate maturity, notice of acceleration of maturity, notice of sale and all other notices of any kind whatsoever. Any failure by Bank to exercise any right hereunder shall not be construed as a waiver of the right to exercise the same or any other right at any time.

Amendment and Severability. No amendment to or modification of this Agreement shall be binding upon Bank unless in writing and signed by it. If any provision of this Agreement shall be prohibited or invalid under applicable law, such provision shall be ineffective but only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement.

Miscellaneous. This Agreement is fully assignable by Bank and all rights of Bank thereunder shall inure to the benefit of its successors and assigns. This Agreement shall be binding upon Borrower and its successors and assigns. The captions contained in this Agreement are inserted for convenience only and shall not affect the meaning or interpretation of the Agreement. This Agreement shall be governed by and interpreted in accordance with the laws of the state where Bank’s office as shown herein is located, without regard to that state’s conflict of laws principles.

Notices. Any notices to Borrower shall be sufficiently given, if in writing and mailed or delivered to the Borrower’s address shown above (attention Borrower’s Corporate General Counsel) or such other address as provided hereunder, and to Bank, if in writing and mailed or delivered to Bank’s office address shown above or such other address as Bank may specify in writing from time to time. In the event that Borrower changes Borrower’s address at any time prior to the date the Obligations are paid in full, Borrower agrees to promptly give written notice of said change of address by registered or certified mail, return receipt requested, all charges prepaid.

Conditions Precedent. All advances under the Note are subject to the following conditions precedent: (a) Non-Default. Borrower shall be in compliance with all of the terms and conditions set forth herein and an Event of Default as specified herein, or an event which upon notice or lapse of time or both would constitute such an Event of Default, shall not have occurred or be continuing at the time of such Advance. (b) Borrowing Resolution. Bank shall have received all certified resolutions authorizing borrowings by Borrower under this Agreement. (c) Financial Information and Documents. Borrower shall deliver to Bank such information and documents as Bank may request from time to time, including without limitation, financial statements, information pertaining to Borrower’s financial condition and additional supporting documents. (d) Purchase/Warehousing Facility. Borrower shall provide evidence to Bank regarding availability under its then existing purchase/warehousing facility in an amount not less than that requested advance plus the then outstanding balance of the Loan. (e) Certificates of Good Standing. Borrower shall have delivered a Certificate of Good Standing for each Borrower (all dated within thirty days of the date of this Agreement) issued by the respective Secretary of State.

Sixth Amended and Restated Loan Agreement. This Sixth Amended and Restated Loan Agreement, amends, replaces and supersedes in its entirety that certain Fifth Amended and Restated Loan Agreement dated as of July 26, 2006, executed by Borrower in favor of Bank (the “Original Loan Agreement”). Should there be any conflict between any of the terms of the Original Loan Agreement, and the terms of this Agreement, the terms of this Agreement shall control.

FEE. Borrower shall pay Bank a fee in the amount of $12,500.00 upon the closing of the Loan.

WAIVER OF JURY TRIAL. TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF BORROWER BY EXECUTION HEREOF AND BANK BY ACCEPTANCE HEREOF, KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHT EACH MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY AGREEMENT CONTEMPLATED TO BE EXECUTED IN CONNECTION WITH THIS AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY

Page 9

WITH RESPECT HERETO. THIS PROVISION IS A MATERIAL INDUCEMENT TO BANK TO ENTER INTO THIS AGREEMENT . EACH OF THE PARTIES AGREES THAT THE TERMS HEREOF SHALL SUPERSEDE AND REPLACE ANY PRIOR AGREEMENT RELATED TO ARBITRATION OF DISPUTES BETWEEN THE PARTIES CONTAINED IN ANY LOAN DOCUMENT OR ANY OTHER DOCUMENT OR AGREEMENT HERETOFORE EXECUTED IN CONNECTION WITH, RELATED TO OR BEING REPLACED, SUPPLEMENTED, EXTENDED OR MODIFIED BY, THIS AGREEMENT.

[EXECUTIONS COMMENCE ON FOLLOWING PAGE]

Page 10

The parties hereto have duly executed this instrument as of the date stated above.


	Wachovia Bank, National Association, successor in interest to First Union National Bank

	By:

		Karen J. Leikert, Senior Vice President

	Bluegreen Corporation, a Massachusetts corporation

	By:

		Anthony M. Puleo, Senior Vice President,
		Chief Financial Officer and Treasurer
		Taxpayer Identification Number: 03-0300793

	Bluegreen Resorts Management, Inc., a Delaware corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 65-0520217

	Bluegreen Vacations Unlimited, Inc., a Florida corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 65-0433722

	Bluegreen Holding Corporation (Texas), a Delaware corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 65-0796382

[CONTINUES ON FOLLOWING PAGE]

Page 11


Bluegreen Southwest One, L.P., a Delaware limited partnership

By:	Bluegreen Southwest Land, Inc., a Delaware corporation, Its General Partner

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 65-0914561

Bluegreen Asset Management Corporation, a Delaware corporation


	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 03-0325365

	Bluegreen Carolina Lands, LLC, a Delaware limited liability company

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 65-0941345

	Bluegreen Corporation of Tennessee, a Delaware corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 03-0316460

	Bluegreen Corporation of the Rockies, a Delaware corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 65-0349373

	Bluegreen Properties of Virginia, Inc., a Delaware corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 52-1752664

[CONTINUES ON FOLLOWING PAGE]

Page 12


	Bluegreen Resorts International, Inc., a Delaware corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 65-0803615

	Carolina National Golf Club, Inc., a North Carolina corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 62-1667685

	Leisure Capital Corporation, a Vermont corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 03-0327285

	Bluegreen West Corporation, a Delaware corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 59-3300205

	Bluegreen Golf Clubs, Inc., a Delaware corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 65-0912659

	Bluegreen Interiors, LLC, a Delaware limited liability company

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 65-0929952

[CONTINUES ON FOLLOWING PAGE]

Page 13


	Bluegreen Southwest Land, Inc., a Delaware corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 65-0910609

	New England Advertising Corporation, a Vermont corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 03-0295158

	Bluegreen Guaranty Corporation, a Florida corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 65-0341038

	Jordan Lake Preserve Corporation, a North Carolina corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 65-1038536

	Leisure Communication Network, Inc., a Delaware corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 65-1049209

	Managed Assets Corporation, a Delaware corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 65-1079961

	travelheads, inc., a Florida corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 65-1129982

[CONTINUES ON FOLLOWING PAGE]

Page 14


	Encore Rewards, Inc., a Delaware corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 65-1138973

	Leisurepath, Inc., a Florida corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 03-0407452

	BXG Realty, Inc., a Delaware corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 04-3693479

	Texas Homesite Realty, Inc., a Texas corporation
	f/k/a Mystic Shores Realty, Inc.

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 04-3678944

	Brickshire Realty, Inc., a Virginia corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 01-0706966

	Catawba Falls, LLC, a North Carolina limited liability company

	By:

		Anthony M. Puleo, Manager
		Taxpayer Identification Number: 03-0466014

[CONTINUES ON FOLLOWING PAGE]

Page 15


	Preserve at Jordan Lake Realty, Inc., a North Carolina corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 06-1638828

	Bluegreen Purchasing & Design, Inc., a Florida corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 54-2064090

	Great Vacation Destinations, Inc., a Florida corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 51-0420655

	Lake Ridge Realty, Inc., a Texas corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 55-0794661

	Bluegreen Communities of Texas, L.P., a Delaware limited partnership

	By: Bluegreen Southwest Land, Inc., a Delaware corporation, its General Partner


		By:

			Anthony M. Puleo, Vice President and Treasurer
			Taxpayer Identification Number: 20-3600096


	Pinnacle Vacations, Inc., a Delaware corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 20-3704976

[CONTINUES ON FOLLOWING PAGE]

Page 16


	Bluegreen Communities of Georgia, LLC, a Georgia limited liability company

	By:

		Anthony M. Puleo, Manager
		Taxpayer Identification Number: 51-0446159

	Bluegreen Communities of Georgia Realty, Inc., a Georgia corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 51-0446176

	BXG Realty Tenn, Inc., a Tennessee corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 62-1697300

	Bentwater Realty, Inc., a Texas corporation f/k/a
	Mountain Lakes Realty, Inc.

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 55-0794661

	Bluegreen Nevada, LLC, a Delaware limited liability company

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 20-8208202

	Family Fun Company, LLC, a Delaware limited liability company

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 20-3326331

[CONTINUES ON FOLLOWING PAGE]

Page 17


	BXG Mineral Holdings, LLC, a Delaware limited liability company

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 20-5935329

	Texas Hill Country Realty, Inc., a Texas corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 20-8879252

	BXG Construction, LLC, a Delaware limited liability company

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 26-0316058

	Bluegreen Communities of Houston - I, LLC, a Delaware limited liability company

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number: 26-0589691

	BXG Acquisition Corp., a Delaware corporation

	By:

		Anthony M. Puleo, Vice President and Treasurer
		Taxpayer Identification Number:____________

[ACKNOWLEDGMENTS APPEAR ON FOLLOWING PAGE]

Page 18


State of Florida	)
	) SS:
County of Broward	)

The foregoing instrument was acknowledged before me this _____ day of August, 2007, by Karen J. Leikert, as Senior Vice President, of Wachovia Bank, National Association, on behalf of the company. She is personally known to me or has produced a driver’s license, passport or military identification, or other form of identification and did not take an oath.



	Print or Stamp Name: __________________________
	Notary Public, State of Florida at Large
	Commission No.: ______________________________


State of Florida	)
	) SS:
County of Plam Beach	)

The foregoing instrument was acknowledged before me this _____ day of August, 2007, by Anthony M. Puleo, as Senior Vice President, Chief Financial Officer and Treasurer of Bluegreen Corporation, a Massachusetts corporation, on behalf of the corporation. He is personally known to me or has produced a driver’s license, passport or military identification, or other form of identification and did not take an oath.



	Print or Stamp Name: ___________________________
	Notary Public, State of Florida at Large
	Commission No.: ______________________________


State of Florida	)
	) SS:
County of Palm Beach	)

The foregoing instrument was acknowledged before me this _____ day of August, 2007, by Anthony M. Puleo, as Vice President and Treasurer of Bluegreen Southwest Land, Inc., a Delaware corporation, the sole general partner of Bluegreen Communities of Texas, L.P., a Delaware limited partnership, on behalf of the corporation and as an act of the partnership. He is personally known to me or has produced a driver’s license, passport or military identification, or other form of identification and did not take an oath.


	Print or Stamp Name: ___________________________
	Notary Public, State of Florida at Large
	Commission No.: ______________________________

[CONTINUES ON FOLLOWING PAGE]

Page 19


State of Florida	)
	) SS:
County of Palm Beach	)

The foregoing instrument was acknowledged before me this _____ day of August, 2007, by Anthony M. Puleo, as Vice President and Treasurer of Bluegreen Southwest Land, Inc., a Delaware corporation, the sole general partner of Bluegreen Southwest One, L.P., a Delaware limited partnership, on behalf of the corporation and as an act of the partnership. He is personally known to me or has produced a driver’s license, passport or military identification, or other form of identification and did not take an oath.


	Print or Stamp Name: ___________________________
	Notary Public, State of Florida at Large
	Commission No.: ______________________________


State of Florida	)
	) SS:
County of Palm Beach	)

The foregoing instrument was acknowledged before me this _____ day of August, 2007, by Anthony M. Puleo, as Vice President and Treasurer of the following entities: Bluegreen Resorts Management, Inc., a Delaware corporation; Bluegreen Vacations Unlimited, Inc., a Florida corporation; Bluegreen Holding Corporation (Texas), a Delaware corporation; Bluegreen Asset Management Corporation, a Delaware corporation; Bluegreen Carolina Lands, LLC, a Delaware limited liability company; Bluegreen Corporation of Tennessee, a Delaware corporation; Bluegreen Corporation of the Rockies, a Delaware corporation; Bluegreen Properties of Virginia, Inc., a Delaware corporation; Bluegreen Resorts International, Inc., a Delaware corporation; Carolina National Golf Club, Inc., a North Carolina corporation; Leisure Capital Corporation, a Vermont corporation; Bluegreen West Corporation, a Delaware corporation; Bluegreen Golf Clubs, Inc., a Delaware corporation; Bluegreen Interiors, LLC, a Delaware limited liability company; Bluegreen Southwest Land, Inc., a Delaware corporation; New England Advertising Corporation, a Vermont corporation; Bluegreen Guaranty Corporation, a Florida corporation; Jordan Lake Preserve Corporation, a North Carolina corporation; Leisure Communication Network, Inc., a Delaware corporation; Managed Assets Corporation, a Delaware corporation; travelheads, inc., a Florida corporation; Encore Rewards, Inc., a Delaware corporation; Leisurepath, Inc., a Florida corporation; BXG Realty, Inc., a Delaware corporation; Texas Homesite Realty, Inc., a Texas corporation f/k/a Mystic Shores Realty, Inc.; Brickshire Realty, Inc., a Virginia corporation; Catawba Falls, LLC, a North Carolina limited liability company; Preserve at Jordan Lake Realty, Inc., a North Carolina corporation; Bluegreen Purchasing & Design, Inc., a Florida corporation; Great Vacation Destinations, Inc., a Florida corporation; Lake Ridge Realty, Inc., a Texas corporation; Pinnacle Vacations, Inc., a Delaware corporation; Bluegreen Communities of Georgia, LLC, a Georgia limited liability company; Bluegreen Communities of Georgia Realty, Inc., a Georgia corporation; BXG Realty Tenn, Inc., a Tennessee corporation; Bentwater Realty, Inc., a Texas corporation; Bluegreen Nevada, LLC, a Delaware limited liability company, Family Fun Company, LLC, a Delaware limited liability company; BXG Mineral Holdings, LLC, a Delaware limited liability company, Texas Hill Country Realty, Inc., a Texas Corporation; BXG Construction, LLC, a Delaware limited liability company; Bluegreen Communities of Houston – I, LLC, a Delaware limited liability company; BXG Acquisition Corp., a Delaware corporation, on behalf of each such entity. He is personally known to me or has produced a driver’s license, passport or military identification, or other form of identification and did not take an oath.



	Print or Stamp Name: ___________________________
	Notary Public, State of Florida at Large
	Commission No.: ______________________________

Page 20

LOAN AGREEMENT

Wachovia Bank, National Association
225 Water Street
Jacksonville, Florida 32202
(Hereinafter referred to as the “Bank”)

BLUEGREEN VACATIONS UNLIMITED, INC., a Florida corporation
4960 Conference Way North
Suite 100
Boca Raton, Florida 33431
(Hereinafter referred to as “Borrower”)

This Loan Agreement (“Agreement”) is entered into December 19, 2007, by and between Bank and Borrower.

This Agreement applies to the loan (the “Loan”) evidenced by that certain Promissory Note dated as of even date herewith from Borrower in favor of Bank in the original principal amount of $12,080,000.00 (as the same may be amended, restated, modified or replaced from time to time, the “Note”), that certain Deed of Trust, Assignment of Rents and Security Agreement (as the same may be amended, restated, modified or replaced from time to time, the “Deed of Trust”), and all Loan Documents. The terms “Loan Documents” and “Obligations,” as used in this Agreement, are defined in the Note.

Relying upon the covenants, agreements, representations and warranties contained in this Agreement, Bank is willing to extend credit to Borrower upon the terms and subject to the conditions set forth herein, and Bank and Borrower agree as follows:

REPRESENTATIONS. Borrower represents that from the date of this Agreement and until final payment in full of the Obligations: Accurate Information. All information now and hereafter furnished to Bank is and will be true, correct and complete. Any such information relating to Borrower’s financial condition will accurately reflect Borrower’s financial condition as of the date(s) thereof, (including all material asserted contingent liabilities of every type), and Borrower further represents that its financial condition has not changed materially or adversely since the date(s) of such documents. Authorization; Non-Contravention. The execution, delivery and performance by Borrower and any guarantor, as applicable, of this Agreement and other Loan Documents to which it is a party are within its power, have been duly authorized as may be required and, if necessary, by making appropriate filings with any governmental agency or unit and are the legal, binding, valid and enforceable obligations of Borrower and any guarantors; and do not (i) contravene, or constitute (with or without the giving of notice or lapse of time or both) a violation of any provision of applicable law, a violation of the organizational documents of Borrower or any guarantor, or a default under any agreement, judgment, injunction, order, decree or other instrument binding upon or affecting Borrower or any guarantor, (ii) result in the creation or imposition of any lien (other than the lien(s) created by the Loan Documents) on any of Borrower’s or any guarantor’s assets, or (iii) give cause for the acceleration of any obligations of Borrower or any guarantor to any other creditor. Asset Ownership. Borrower has good and marketable title to all of the properties and assets secured by the Deed of Trust, and all such properties and assets are free and clear of mortgages, security deeds, pledges, liens, charges, and all other encumbrances, except as otherwise disclosed to Bank by Borrower in writing and approved by Bank (“Permitted Liens”). In addition, all of its stock is free and clear of liens, pledges and encumbrances. To Borrower’s knowledge, no default has occurred under any Permitted Liens and no claims or interests adverse to Borrower’s present rights in its properties and assets have arisen. Discharge of Liens and Taxes. Borrower has duly filed, paid and/or discharged all taxes or other claims that may become a lien on any of its property or assets encumbered by the Deed of Trust, except to the extent that such items are being appropriately contested in good faith and an adequate reserve for the payment thereof is being maintained if required by GAAP. Sufficiency of Capital. Borrower is not, and after consummation of this Agreement and after giving effect to all indebtedness incurred and liens created by Borrower in connection with the Note and any other Loan

Documents, will not be, insolvent within the meaning of 11 U.S.C. § 101, as in effect from time to time. Compliance with Laws. Borrower and any subsidiary and affiliate of Borrower and any guarantor are in compliance in all material respects with all federal, state and local laws, rules and regulations applicable to its properties, operations, business, and finances, including, without limitation, any federal or state laws relating to liquor (including 18 U.S.C. § 3617, et seq.) or narcotics (including 21 U.S.C. § 801, et seq.) and/or any commercial crimes; all applicable federal, state and local laws and regulations intended to protect the environment; and the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), if applicable with respect to the property encumbered by the Deed of Trust (the “Property”). None of Borrower, or any subsidiary or affiliate of Borrower or any guarantor is a Sanctioned Person or has any of its assets in a Sanctioned Country or does business in or with, or derives any of its operating income from investments in or transactions with, Sanctioned Persons or Sanctioned Countries in violation of economic sanctions administered by OFAC. The proceeds from the Loan will not be used to fund any operations in, finance any investments or activities in, or make any payments to, a Sanctioned Person or a Sanctioned Country. “OFAC” means the U.S. Department of the Treasury’s Office of Foreign Assets Control. “Sanctioned Country” means a country subject to a sanctions program identified on the list maintained by OFAC and available at http://www.treas.gov/offices/enforcement/ofac/sdn/index.shtml, or as otherwise published from time to time. “Sanctioned Person” means (i) a person named on the list of Specially Designated Nationals or Blocked Persons maintained by OFAC available athttp://www.treas.gov/offices/enforcement/ofac/programs/index.shtml, or as otherwise published from time to time, or (ii) (A) an agency of the government of a Sanctioned Country, (B) an organization controlled by a Sanctioned Country, or (C) a person resident in a Sanctioned Country to the extent subject to a sanctions program administered by OFAC. Organization and Authority. Borrower is duly created, validly existing and in good standing under the laws of the state of its organization, and has all powers, governmental licenses, authorizations, consents and approvals required to operate its business as now conducted. Each corporation, partnership or limited liability company Borrower and/or guarantor, as applicable, is duly qualified, licensed and in good standing in each jurisdiction where qualification or licensing is required by the nature of its business or the character and location of its property, business or customers, and in which the failure to so qualify or be licensed, as the case may be, in the aggregate, could have a material adverse effect on the business, financial position, results of operations, properties or prospects of Borrower or any such guarantor. No Litigation. There are no material pending suits, claims or demands against Borrower or any guarantor which would have a material adverse affect on their ability to repay the Loan that have not been disclosed in Guarantor’s periodic filings with the Securities and Exchange Commission (“SEC”) to Bank by Borrower in writing, and approved by Bank. To the best of Borrower’s knowledge, there are no threatened suits, claims or demands against Borrower or any guarantor which would have a material adverse affect on their ability to repay the Loan that have not been disclosed to Bank by Borrower in writing, and approved by Bank. ERISA. Each employee pension benefit plan, as defined in ERISA, maintained by Borrower meets, as of the date hereof, the minimum funding standards of ERISA and all applicable regulations thereto and requirements thereof, and of the Internal Revenue Code of 1986, as amended. No “Prohibited Transaction” or “Reportable Event” (as both terms are defined by ERISA) has occurred with respect to any such plan. Indemnity. Borrower will indemnify Bank and its affiliates from and against any losses, liabilities, claims, damages, penalties or fines imposed upon, asserted or assessed against or incurred by Bank arising out of the inaccuracy or breach of any of the representations contained in this Agreement or any other Loan Documents.

AFFIRMATIVE COVENANTS. Borrower agrees that from the date hereof and until final payment in full of the Obligations, unless Bank shall otherwise consent in writing, Borrower will: Access to Books and Records. Allow Bank, or its agents, during normal business hours and upon prior advance written notice, access to the books, records and such other documents of Borrower as Bank shall reasonably require, and allow Bank, to inspect, audit and examine the same and to make extracts therefrom and to make copies thereof. Business Continuity. Conduct its business in substantially the same manner and locations as such business is now and has previously been conducted. Certificate of Full Compliance. Borrower shall cause BLUEGREEN CORPORATION, a Massachusetts corporation (“Guarantor”) to deliver to Bank a certificate of covenant compliance, including all calculations, with the Annual Financial Statement and the Quarterly Financial Statements required herein. Such certificate shall be in form reasonably acceptable to Bank in its sole discretion and shall be certified by the Guarantor to be true and

Page 2

correct. Compliance with Other Agreements. Comply with all terms and conditions contained in this Agreement, and any other Loan Documents, and swap agreements, if applicable, as defined in 11 U.S.C. § 101, as in effect from time to time. Estoppel Certificate. Furnish, within 15 days after request by Bank, a written statement duly acknowledged of the amount due under the Loan and, to its knowledge, whether offsets or defenses exist against the Obligations. Insurance . Maintain adequate insurance coverage with respect to the Property and business against loss or damage of the kinds and in the amounts customarily insured against by companies of established reputation engaged in the same or similar businesses including, without limitation, commercial general liability insurance, workers compensation insurance, and business interruption insurance; all acquired in such amounts and from such companies as Bank may reasonably require. Maintain Properties. Maintain, preserve and keep the Property in good repair, working order and condition, making all replacements, additions and improvements thereto necessary for the proper conduct of its business, unless prohibited by the Loan Documents. Notice of Default and Other Notices. (a) Notice of Default. Furnish to Bank immediately upon becoming aware of the existence of any condition or event which constitutes a Default (as defined in the Loan Documents) or any event which, upon the giving of notice or lapse of time or both, may become a Default, written notice specifying the nature and period of existence thereof and the action which Borrower is taking or proposes to take with respect thereto. (b) Other Notices. Promptly notify Bank in writing of (i) any material adverse change in its financial condition or its business; (ii) any default under any material agreement, contract or other instrument to which it is a party or by which any of its properties are bound, or any acceleration of the maturity of any indebtedness owing by Borrower; (iii) any material adverse claim against or affecting Borrower or any part of its properties. Bank acknowledges that disclosure of all such matters in Guarantor’s SEC filings constitutes notice thereof to Bank; (iv) the commencement of, and any material determination in, any litigation with any third party or any proceeding before any governmental agency or unit in an amount which would require Guarantor to disclose such litigation or proceeding to the SEC. Bank acknowledges that disclosure of all such matters in Guarantor’s SEC filings constitutes notice thereof to Bank; and (v) at least 30 days prior thereto, any change in Borrower’s name or address as shown above, and/or any change in Borrower’s structure. Other Financial Information. Deliver promptly such other information regarding the operation, business affairs, and financial condition of Borrower which Bank may reasonably request.

NEGATIVE COVENANTS. Borrower agrees that from the date hereof and until final payment in full of the Obligations, unless Bank shall otherwise consent in writing, Borrower will not: Default on Other Contracts or Obligations. Default on any material contract with or obligation when due to a third party or default in the performance of any obligation to a third party incurred for money borrowed in excess of $5,000,000.00 which is not cured within the applicable cure period. Government Intervention. Permit the making of any seizure, vesting or intervention by or under authority of any governmental entity, as a result of which the management of Borrower or any guarantor is displaced of its authority in the conduct of its respective business or such business is curtailed or materially impaired. Judgment Entered. Permit the entry of any monetary judgment in excess of $1,000,000.00, or the assessment against, the filing of any tax lien against, or the issuance of any writ of garnishment or attachment against the Property, not dismissed or bonded within thirty (30) days.

ANNUAL FINANCIAL STATEMENTS. Borrower shall cause Guarantor to deliver to Bank, within ninety (90) days after the close of each fiscal year, audited financial statements reflecting its operations during such fiscal year, including, without limitation, a balance sheet, profit and loss statement and statement of cash flows, with supporting schedules; all on a consolidated basis with respect to Guarantor and its subsidiaries and affiliates, as applicable, and in reasonable detail, prepared in conformity with generally accepted accounting principles, applied on a basis consistent with that of the preceding year, except as disclosed in the notes to such financial statements. All such statements shall be examined by an independent certified public accountant acceptable to Bank. The opinion of such independent certified public accountant shall not be acceptable to Bank if qualified due to any limitations in scope imposed by Guarantor or any other person or entity. Any other qualification of the opinion by the accountant shall render the acceptability of the financial statements subject to Bank’s approval. Notwithstanding the foregoing, any adverse, qualified or scope limitation with the Guarantor’s audit opinion relative to Section 404 of the Sarbanes-Oxley Act of 2002 will not make an otherwise unqualified opinion on the financial statement audit unacceptable to Bank unless, in the Bank’s opinion, such adverse, qualified or scope

Page 3

limitation is material in nature, including, without limitation, calling into question the effectiveness of the Borrower’s internal control under Section 404. Guarantor shall provide Bank with a copy of any management letter addressed to it from such independent accountant.

QUARTERLY FINANCIAL STATEMENTS. Borrower shall cause Guarantor to deliver to Bank, within sixty (60) days after the end of each fiscal quarter, unaudited management-prepared quarterly financial statements including, without limitation, a balance sheet, profit and loss statement and statement of cash flows, with supporting schedules; all on a consolidated basis with respect to Guarantor and its subsidiaries and affiliates, all in reasonable detail and prepared in conformity with generally accepted accounting principles, applied on a basis consistent with that of the preceding year except as disclosed in the notes to such financial statements. Such statements shall be certified as to their correctness by a principal financial officer of Guarantor.

FINANCIAL COVENANTS. Borrower agrees to the following provisions from the date hereof until final payment in full of the Guaranteed Obligations, unless Bank shall otherwise consent in writing, and all financial covenants shall be calculated on a consolidated basis, using the financial information for Guarantor, its subsidiaries and affiliates, as applicable: Adjusted Total Liabilities to Adjusted Tangible Net Worth Ratio. Borrower shall cause Guarantor to maintain, on a consolidated basis, at all times, a ratio of Adjusted Total Liabilities to Adjusted Tangible Net Worth of not more than 2.25 to 1.00. This covenant will be tested quarterly upon Bank’s receipt of the Quarterly Financial Statements required herein. “Adjusted Total Liabilities” shall mean the sum of all liabilities of Guarantor on a consolidated basis, excluding deferred income, any non-recourse obligations backed by vacation ownership receivables, cash and cash equivalents, and debt fully subordinated to Bank on terms and conditions acceptable to Bank in its sole discretion; and including capitalized leases and all reserves for deferred taxes and other deferred sums appearing on the liabilities side of a balance sheet, all in accordance with generally accepted accounting principles applied on a consistent basis. “Adjusted Tangible Net Worth” shall mean total assets minus Adjusted Total Liabilities. For purposes of this computation, the aggregate amount of any intangible assets of Guarantor including, without limitation, goodwill, franchises, licenses, patents, trademarks, trade names, copyrights, service marks, and brand names, shall be subtracted from total assets. EBITDA to Interest Ratio. Borrower shall cause Guarantor to maintain, on a consolidated basis, at all times, an EBITDA to Interest Ratio of not less than 2.50 to 1.00. “EBITDA to Interest Ratio” shall mean (i) the sum of earnings before interest expense, taxes, depreciation expense and amortization, divided by (ii) interest expense net of interest income. This covenant shall be tested quarterly upon Bank’s receipt of the Quarterly Financial Statements required herein. Liquidity Requirement. Borrower shall cause Guarantor to maintain, on a consolidated basis, at all times, unencumbered Liquid Assets of not less than $50,000,000.00. “Liquid Assets” shall mean the sum of all unrestricted cash and unencumbered timeshare receivables. This covenant shall be tested quarterly upon Bank’s receipt of the Quarterly Financial Statements required herein. Account Relationships. Guarantor has established and shall maintain depository and treasury services relationships with Bank.

JOINDER. Bank agrees to join easements, declarations, condominium and timeshare documents, and other land development documents, provided same are in form and content reasonably acceptable to Bank.

CONDITIONS PRECEDENT. The obligations of Bank to make the loan and any advances pursuant to this Agreement are subject to the following conditions precedent: Additional Documents. Receipt by Bank of such additional supporting documents as Bank or its counsel may reasonably request. Opinion of Counsel. On or prior to the date of any extension of credit hereunder, Bank shall have received a written opinion of the counsel of Borrower in form reasonably acceptable to Bank and Bank’s counsel.

DEFAULTS AND REMEDIES. If the following event occurs, a default (“Default”) under this Agreement shall exist: failure to timely pay or perform any of the terms, covenants or obligations under this Agreement or a default under any other Loan Document, in any case not cured within the applicable cure period set forth in the Note or other Loan Document, if any.

Page 4

Upon the occurrence of a Default, Bank shall have the right to declare immediately due and payable the outstanding principal balance of the Note, all accrued and unpaid interest thereon and all other sums due in connection therewith, and Bank may exercise any right, power or remedy permitted by law or as set forth in any of the Loan Documents.

FEE. Borrower shall pay Bank a fee in the amount of $30,200.00 upon the closing of the Loan.

[CONTINUES ON FOLLOWING PAGE]

Page 5

IN WITNESS WHEREOF , Borrower and Bank, on the day and year first written above, have caused this Agreement to be duly executed under seal.


	BORROWER:

	BLUEGREEN VACATIONS UNLIMITED, INC.,
	a Florida corporation

	By:

		Anthony M. Puleo, Vice President

		[CONTINUES ON FOLLOWING PAGE]

Page 6


	BANK:

	Wachovia Bank, National Association

	By:

		Karen Leikert, Senior Vice President

Page 7

SCHEDULE 1
COVENANT COMPLIANCE CERTIFICATE

Borrower Name: BLUEGREEN VACATIONS UNLIMITED, INC., a Florida corporation

Guarantor Name: BLUEGREEN CORPORATION, a Massachusetts corporation

For the fiscal ________________ ended ____________________

ALL CAPITALIZED TERMS USED BUT NOT DEFINED HEREIN SHALL HAVE THE MEANINGS GIVEN IN THE LOAN DOCUMENTS.


COVENANT			ACTUAL	REQUIRED

Adjusted Total Liabilities to Adjusted				not more than 2.25 to 1.00
Tangible Net Worth
	(a)	Adjusted Total Liabilities	__________
	(b)	total assets	__________
	(c)	intangible assets	__________

(a) divided by the sum of (b) minus
(a) minus (c) equals Adjusted Total Liabilities to
Adjusted Tangible Net Worth of __________				Compliance? Yes No

EBITDA to Interest Ratio				not less than 2.5 to 1.00
	(a)	net income	__________
	(b)	interest expense, less
		interest income	__________
	(c)	taxes	__________
	(d)	depreciation expense	__________
	(e)	amortization	__________

the sum of (a) plus (b)
plus (c) plus (d) plus (e) divided by (b)
equals EBITDA to Interest
Ratio of __________				Compliance? Yes No

Liquidity Requirement				Not Less Than $50,000,000.00
	(a)	unrestricted cash	__________
	(b)	unencumbered time	__________
		share receivables	__________

Sum of (a) plus (b) equals
Liquid Assets of : __________				Compliance? Yes No

Execution Copy

AMENDED AND RESTATED OPERATING AGREEMENT OF
BLUEGREEN/BIG CEDAR VACATIONS, LLC

Execution Copy

TABLE OF CONTENTS


ARTICLE 1.	ORGANIZATION		1

	Section 1.1	Continuation Of The Company	1
	Section 1.2	Name	2
	Section 1.3	Term	2
	Section 1.4	Character of Business; Powers	2
	Section 1.5	Principal Place of Business	2
	Section 1.6	Domestic Registered Agent and Registered Office	2
	Section 1.7	Foreign Agents and Registered Office	2
	Section 1.8	Certain Definitions	3
	Section 1.9	Other Defined Terms	9
	Section 1.10	References; Pronouns; Headings.	10

ARTICLE 2.	CAPITAL ACCOUNTS AND CONTRIBUTIONS; MEMBER LOANS		11

	Section 2.1	Capital Contributions	11
	Section 2.2	Additional Capital Contributions; Additional Membership Interests	11
	Section 2.3	Capital Accounts	12
	Section 2.4	Negative Capital Accounts	12
	Section 2.5	Certain Limitations	13
	Section 2.6	RFC Loan	13
	Section 2.7	Other Loans by Members or Affiliates	14
	Section 2.8	Accounting	15

ARTICLE 3.	DISTRIBUTIONS		15

	Section 3.1	Distributions of Operating Proceeds	15
	Section 3.2	Tax Distributions	15
	Section 3.3	Distributions to be Made in Cash	16
	Section 3.4	Withholding and Offset	16

ARTICLE 4.	ALLOCATION OF PROFITS AND LOSSES		16

	Section 4.1	Profits and Losses	16
	Section 4.2	Regulatory and Curative Allocations	17
	Section 4.3	Tax Allocations	18
	Section 4.4	Other Allocation Rules	19

ARTICLE 5.	ACCOUNTING AND TAX MATTERS		19

	Section 5.1	Accounting Methods; Company Records	19
	Section 5.2	Fiscal Year	20
	Section 5.3	Bank Accounts; Title to Business Property	20
	Section 5.4	Tax Matters	20

Execution Copy


ARTICLE 6.	MANAGEMENT AND BUSINESS POLICIES		21

	Section 6.1	Management by Management Committee	21
	Section 6.2	Meetings of the Management Committee	21
	Section 6.3	Action by Written Consent Without a Meeting	22
	Section 6.4	General Manager	22
	Section 6.5	Specific Authority of Management Committee and General Manager	22
	Section 6.6	Certificate	24
	Section 6.7	Restrictions on Authority of the Management Committee and the General Manager	24
	Section 6.8	Insurance	25
	Section 6.9	Business Plans and Budgets; Amenity Development	27
	Section 6.10	Big Cedar Approval Rights	29
	Section 6.11	Meetings and Voting by Members	29
	Section 6.12	Liability and Indemnification of the Management Committee, Members and Affiliates	30

ARTICLE 7.	LIMITED LIABILITY; RIGHTS AND OBLIGATIONS OF THE MEMBERS		30

	Section 7.1	Limited Liability	30
	Section 7.2	Member Limited Liability	31
	Section 7.3	Conflicts of Interest	31
	Section 7.4	Transactions With Members and Affiliates	31
	Section 7.5	Compensation and Reimbursement of the Members; Management Committee; General Manager	32
	Section 7.6	Non-Competition—Bluegreen	32
	Section 7.7	Non-Competition—BCLLC	34
	Section 7.8	BCLLC’s Right to Participate	34
	Section 7.9	Bluegreen’s Right to Participate	35
	Section 7.10	Specific Rights, Authority and Obligations of the Members	36
	Section 7.11	Records of the Company	37

ARTICLE 8.	TRANSFERS OF INTERESTS		38

	Section 8.1	Restrictions	38
	Section 8.2	Effect of Assignment; Documents	38

ARTICLE 9.	DISSOLUTION OF THE COMPANY		39

	Section 9.1	Liquidation Events	39
	Section 9.2	Right to Continue Business and Affairs of Company	39
	Section 9.3	Distribution of Proceeds on Dissolution; Winding Up; Reserves	40
	Section 9.4	Allocations Upon Dissolution	41

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ARTICLE 10.	GENERAL		41

	Section 10.1	Notices/Approvals to Be In Writing	41
	Section 10.2	Entire Agreement	42
	Section 10.3	Amendments	42
	Section 10.4	Miscellaneous	42
	Section 10.5	GOVERNING LAW	43
	Section 10.6	Submission to Jurisdiction	43
	Section 10.7	Remedies	43
	Section 10.8	Representations and Warranties	44
	Section 10.9	Financial Reporting	45
	Section 10.10	Confidentiality; Public Announcements	45

INDEX OF EXHIBITS


Exhibit A	Names, Addresses, Capital Accounts, and Percentage Interests of Members
Exhibit B	Big Cedar Timeshare Property
Exhibit C	Red Rock Bluff Property
Exhibit D	Red Rock Bluff Business Plan
Exhibit E	Deliberately Omitted
Exhibit F	Business Plan
Exhibit G	Annual Budget

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AMENDED AND RESTATED OPERATING AGREEMENT

BLUEGREEN/BIG CEDAR VACATIONS, LLC

a Delaware limited liability company

THIS AMENDED AND RESTATED OPERATING AGREEMENT OF BLUEGREEN/BIG CEDAR VACATIONS, LLC (“ Agreement ”) is made and entered into as of this 31st day of December, 2007 (the “ Effective Date ”) by and among those Persons identified on Exhibit A attached hereto (the “ Members ”).

WITNESSETH

WHEREAS , Bluegreen/Big Cedar Vacations, LLC (the “ Company ”) was formed as a Delaware limited liability company on May 1, 2000 pursuant to and under the Act, by the filing of a Certificate of Formation with the Secretary of State of the State of Delaware;

WHEREAS , the Company is currently governed by that certain Operating Agreement of Bluegreen/Big Cedar Vacations, LLC dated as of June 16, 2000 (the “ Original Operating Agreement ”), for the purpose of setting forth the understandings and agreements of the Members with respect to the organization and operation of the Company and the scope and conduct of its business, including its development of the timeshare project Big Cedar Wilderness Club Condominium in Ridgedale, Missouri, which is marketed as Wilderness Club at Big Cedar, a Bluegreen Resort (the “ Original Project ”);

WHEREAS , the Company has acquired or will acquire certain real property adjacent to the Original Project for purposes of the construction and development of the Building 3000 Project (as defined herein), and has acquired the Red Rock Bluff Property (as defined herein) for purposes of the construction and development of the Red Rock Bluff Timeshare Project (as defined herein); and

WHEREAS , in connection with the acquisition of such property and the construction and development of the Building 3000 Project and the Red Rock Bluff Timeshare Project, the Members now desire to amend and restate the Original Operating Agreement in its entirety on the terms and conditions set forth herein.

NOW, THEREFORE , for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and the mutual promises contained herein, the Members mutually covenant and agree as follows:

ARTICLE 1. ORGANIZATION

Section 1.1 Continuation Of The Company . The Members hereby agree to continue the existence of the Company as a limited liability company under the Act, and all other pertinent Laws of the State of Delaware for the purposes and upon the terms and conditions

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hereinafter set forth. The Members agree that the rights, duties and liabilities of the Members shall be as provided in the Act, except as provided herein.

Section 1.2 Name . The name of the Company shall be “Bluegreen/Big Cedar Vacations, LLC,” or such other name as shall be determined by the Management Committee from time to time.

Section 1.3 Term . The term of the Company commenced as of May 1, 2000 and shall continue until the winding up and liquidation of the Company following a Liquidation Event, as provided in Article 9 .

Section 1.4 Character of Business; Powers .

(A) The business of the Company (the “ Business ”) is to (1) acquire, design, develop, own, operate, market and sell the Timeshare Projects and such other Resort Interest Program(s) as may be mutually agreed upon in writing by the Members, in accordance with the provisions of this Agreement; (2) lease, finance, hold, manage, sell, exchange or otherwise dispose of all or any part of the timeshare units of the Business and the receivables or other assets arising from the sale of timeshare interests; (3) borrow money in furtherance of the Business; and (4) exercise all rights and powers and engage in all activities related or ancillary to the foregoing, as determined by the Management Committee, which a limited liability company may legally exercise pursuant to the Act.

(B) The Company shall not engage in any activity other than the Business and no Member shall have any authority to hold himself or herself out as an agent of the Company in any activity other than the Business and then only in conformity with the provisions of this Agreement.

Section 1.5 Principal Place of Business . The principal place of business of the Company shall be at 4960 Conference Way North, Suite 100, Boca Raton, Florida, 33431, or such other location as may be hereafter determined by the Management Committee.

Section 1.6 Domestic Registered Agent and Registered Office . The name of the Company’s registered agent for service of process in Delaware and its registered office in Delaware shall be The Corporation Services Company, at 2711 Centerville Road, Suite 408, Wilmington, DE 19808, on whose records shall be shown that notice to the Company is to be sent to (A) Big Cedar, L.L.C., 2500 East Kearney Street Springfield, Missouri 65898, Attention: General Counsel; and (B) Bluegreen Corporation, 4960 Conference Way North, Suite 100, Boca Raton, Florida 33431, Attn: General Counsel; provided , however , the Management Committee may change such registered agent and/or registered office, at any time, by making all appropriate filings.

Section 1.7 Foreign Agents and Registered Office . The Management Committee shall (A) take or cause to be taken all action necessary to register the Company as a foreign limited liability company authorized to transact business in other states (collectively, the “ Foreign States ”) if any, as the conduct of the Company’s business so requires; and (B) select and cause the Company to maintain resident or registered agents and offices in each of the Foreign States

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where the maintenance of the same is required by applicable Law, and may change such agents and/or offices, at any time by making all appropriate filings.

Section 1.8 Certain Definitions . As used herein, the following terms have the following meanings:

(A) “ Act ” means the Delaware Limited Liability Company Act, 6 DEL.C§18-101, et. seq ., as the same may be supplemented, amended or modified.

(B) “ Adjusted Capital Account ” means, with respect to any Member, the balance in such Member’s Capital Account as of the end of the relevant Fiscal Year, after giving effect to the following adjustments:

(1) credit to such Capital Account any amounts that such Member is obligated to restore to the Company pursuant to this Agreement or is deemed obligated to restore pursuant to Treasury Regulation § 1.704-1(b)(2)(ii)(c) or the penultimate sentence of each of Treasury Regulation §§ 1.704-2(g)(1) and 1.704-2(i)(5); and

(2) debit to such Capital Account such Member’s share of the items described in Treasury Regulation §§ 1.704-1(b)(2)(ii)(d)(4), (5) and (6)

The foregoing definition of Adjusted Capital Account is intended to comply with the provisions of Treasury Regulation § 1.704-1(b)(2)(ii)(d) and shall be interpreted and applied consistently therewith.

(C) “ Affiliate ,” as to any Person means (1) any other Person directly or indirectly through one or more intermediaries controlling, controlled by or under common control with such Person, or (2) a trust which has as its principal income beneficiaries or remaindermen such Person and/or a member or members of such Person’s Immediate Family. The terms “controlling,” “controlled” and “common control with” mean the ability, by ownership of voting securities or otherwise, directly or indirectly, to direct the managerial and operating policies of a Person. “ Affiliated ” shall have a corresponding meaning. For purposes of Section 7.7 , Affiliates of BCLLC shall not include Tracker Marine, L.L.C., a Missouri limited liability company, and its subsidiaries or Tracker Marine Retail, LLC, a Delaware, LLC, and its subsidiaries. Affiliates of Bluegreen shall include any Affiliate of Bluegreen or any entity that is controlled directly or indirectly by BFC Financial Corporation, provided , however , for purposes of Section 2.6 , Section 7.6 and Article 8 , Affiliates of Bluegreen shall only include Bluegreen Corporation and any controlled subsidiary of Bluegreen Corporation.

(D) “ Agreement ” means this Agreement, as amended from time to time as herein provided.”

(E) “ Bankruptcy Event ” means, with respect to any Person, (i) the commencement by such Person of a voluntary case under, or the consent by such Person to the entry of an order for relief in an involuntary case under, any bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other similar Law now or hereafter in effect, or (ii) the consent by such Person to the appointment of, or taking possession by, a receiver, custodian, liquidator, assignee, trustee or sequestrator (or other similar official) of such Person or

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of any substantial part of its assets, or (iii) the making of a general assignment by such Person generally to pay its debts as they benefit creditors, or (iv) the admission in writing of such Person of its inability to pay its debts as they become due in the ordinary course of business, or (v) the adoption of a resolution by its directors or shareholders (or analogous managers or equity owners) in furtherance of any of the foregoing, or (vi) the entry by a court of competent jurisdiction of a decree or order for relief in respect of such Person in an involuntary case under any bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other similar Law now or hereafter in effect and the continuance of such decree or order unstayed and in effect for a period of ninety (90) days, or (vii) the appointment of a receiver, examiner, custodian, liquidator, assignee, trustee or sequestrator (or other similar official) of such Person or of any substantial part of its assets, not dismissed within ninety (90) days, or (viii) the ordering of the winding up or liquidation of its affairs, or conversion of a pending reorganization proceeding into a proceeding under Chapter 7 of the Bankruptcy Code or other proceeding to liquidate or otherwise dispose of a substantial part of such Person’s properties.

(F) “ BC ” means Bluegreen Corporation, a Massachusetts corporation, and the sole shareholder of Bluegreen.

(G) “ BCLLC ” means Big Cedar, L.L.C. a Missouri limited liability company, or its permitted assignee.

(H) “ Big Cedar Lodge ” means that certain hotel facility known as the Big Cedar Lodge at Ridgedale, located in Taney County, Missouri, which as of the date hereof is owned and operated by BCLLC.

(I) “ Big Cedar Owners’ Association ” means Big Cedar Resort Club Owners Association, Inc., a Missouri not for profit corporation.

(J) “ Big Cedar Timeshare Project ” means that certain timeshare project developed by the Company, inclusive of Original Project and the Building 3000 Project, located contiguous to the Big Cedar Lodge in Taney County, Missouri, which timeshare project is located on the Big Cedar Timeshare Property.

(K) “ Big Cedar Timeshare Property ” means that certain property described on Exhibit B hereto, on which the Big Cedar Timeshare Project is located or to be located.

(L) “ Bluegreen ” means Bluegreen Vacations Unlimited, Inc., a Florida corporation, or its permitted assignee.

“ Bluegreen Vacation Club ” means that certain vacation club operated by Bluegreen, which was initially filed pursuant to Florida Statutes Chapter 721 (The Florida Vacation Plan and Timesharing Act), and is identified in accordance with such registration as the Bluegreen Vacation Club.

(M) “ Building 3000 Project ” means that certain portion of the Big Cedar Timeshare Project currently referred to as “Building 3000”, which has been approved by the Members and as further described in the Business Plan attached hereto as Exhibit F .

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(N) “ Business Property ” means all property, assets and interests (whether real or personal, tangible or intangible) owned or held from time to time by the Company, including without limitation the Big Cedar Timeshare Property and the Red Rock Bluff Property.

(O) “ Capital Account ” means the separate capital account maintained for each Member on the Company’s books and records as provided in Section 2.3 .

(P) “ Capital Contribution ” means with respect to any Member, the amount of money and the Gross Asset Value of any property (other than money) contributed by such Member to the Company.

(Q) “ Code ” means the Internal Revenue Code of 1986, as amended from time to time.

(R) “ Cumulative Loan Return ” means:

(1) with respect to a Member’s Unreturned Member Loan for any Member Loan made by a Member with the other Member’s consent or pursuant to Section 2.2(B) , whereby both Members make such Member Loan in proportion to their Percentage Interest, or the Member Loan described in Section 6.9(B)(3) , a cumulative rate of return equal to the average prime rate, as published in the Wall Street Journal, plus 1%, compounded annually and taking proper account of the amount and timing of (i) each such Member Loan and (ii) any distributions made to such Member under Sections 3.1(A) and (B) ; and

(2) with respect to a Member’s Unreturned Member Loan for any Member Loan made by a Member as a result of the other Member failing to make an agreed Additional Capital Contribution or Member Loan in proportion to its Percentage Interest, a cumulative rate of return equal to the average prime rate, as published in the Wall Street Journal, plus 5%, compounded annually and taking proper account of the amount and timing of (i) each such Member Loan and (ii) any distributions made to such Member under Sections 3.1(A) and (B) .

(S) “ Depreciation ” means, for each Fiscal Year or other period, an amount equal to the depreciation, amortization or other cost recovery deduction allowable for federal income tax purposes with respect to an asset for such period; provided , if the Gross Asset Value of an asset differs from its adjusted basis for federal income tax purposes at the beginning of such period, Depreciation shall be (1) an amount that bears the same ratio to such beginning Gross Asset Value as the federal income tax depreciation, amortization or other cost recovery deduction for such period bears to such beginning adjusted tax basis or (2) if the federal income tax depreciation, amortization or other cost recovery deduction for such period is zero, an amount with reference to such beginning Gross Asset Value using any reasonable method selected by the Management Committee ; provided further , if the remedial allocation method described in Treasury Regulation § 1.704-3(d) is used to take account of the difference between an asset’s Gross Asset Value and its adjusted tax basis, Depreciation shall be determined in accordance with Treasury Regulation § 1.704-3(d)(2).

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(T) “ Field Operating Profit ” means Net Sales Volume less costs of sales and all operating expenses, excluding the Brand Licensing Fee and the Marketing Fee. Field Operating Profit is exclusive of income taxes and any financing income or expenses.

(U) “ Fractional Interest Development ” shall mean a Resort Interest Program in which the interests that are conveyed to purchasers are in increments of time that are greater than or equal to six weeks per year.

(V) “ Governmental Entity ” means any government or any governmental agency, ministry, authority, bureau, board, commission, department, political subdivision or court, whether federal, state, provincial, municipal, or local, domestic or foreign.

(W) “ Gross Asset Value ” means, with respect to any asset of the Company, the asset’s adjusted basis for federal income tax purposes as of the relevant date, except as follows:

(1) The initial Gross Asset Value of any asset contributed by a Member to the Company shall be the gross fair market value of such asset on the date of contribution, as determined by the Management Committee.

(2) The Gross Asset Value of all Company assets shall be adjusted (at the election of the Management Committee ) to equal their respective gross fair market values, as determined by the Management Committee, (a) upon the occurrence of any of the events described in Treasury Regulation § 1.704-1(b)(2)(iv)(f)(5) and (b) at such other times as the Management Committee may reasonably determine necessary or advisable in order to comply with Treasury Regulation §§ 1.704-1(b) and 1.704-2.

(3) The Gross Asset Value of any Company asset distributed to a Member shall be equal to the gross fair market value of such asset on the date of distribution as determined by the Management Committee.

(4) The Gross Asset Value of any Company asset with respect to which an adjustment to tax basis has occurred by reason of application of Code Section 734(b) or 743(b) shall be increased or decreased only if such adjustment is required to be taken into account in determining Capital Accounts pursuant to Treasury Regulation § 1.704-1(b)(2)(iv)(m); provided , the Gross Asset Value shall not be adjusted pursuant to this subsection (4) to the extent that an adjustment pursuant to subsection (2) above is made in connection with a transaction that would otherwise result in an adjustment pursuant to this subsection (4).

(5) If the Gross Asset Value of an asset is not equal to its adjusted tax basis for federal income tax purposes, such Gross Asset Value shall be adjusted by the Depreciation taken into account with respect to such asset for purposes of computing Profits and Losses and other items allocated pursuant to Article 4 .

(X) “ Immediate Family ” means, with respect to any Person, the parents, siblings, spouse and lineal descendants, spouses of such lineal descendants and any trust for the benefit of, or the legal representative of, any of the preceding persons, or any partnership substantially all of the partners of which are one or more of such persons or the Person or any

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limited liability company substantially all of the members of which are one or more of such persons or the Person.

(Y) “ Law ” means any federal, state, provincial, municipal, or local, domestic or foreign, constitutional provision, statute, law (including, without limitation, any common law), ordinance, by-law, rule, code, guideline, standard, regulation, Permit, decree, injunction, judgment, order or legally binding ruling, determination, finding, directive or writ of any Governmental Entity.

(Z) “ Marketing Agreement ” shall mean that certain Amended and Restated Marketing and Promotions Agreement, dated as of the date hereof, by and among Bass Pro, Inc., BCLLC, Bluegreen and the Company.

(AA) “ Membership Interest ” means the limited liability company interest of a Member in the Company, including such Member’s rights to distributions (liquidating or otherwise) and allocations, together with the duties and obligations of such Member to comply with this Agreement. Membership Interests shall be personal property for all purposes.

(BB) “ Net Sales Volume ” shall mean the dollar amount of annual sales of timeshare interests at the Timeshare Projects recognizable in accordance with United States generally accepted accounting principles, which include among other things, deferrals or reductions in sales of timeshare interests for purchaser rescissions, equity trade allowance, cancellations and provision for defaults.

(CC) “ Operating Proceeds ” for the applicable period means all gross cash receipts from operations of the Company during such period (excluding Dissolution Proceeds but including borrowed monies and funds released from reserves by the Management Committee, in its discretion, for previously established reasons), less the following costs and expenses (to the extent as determined by the Management Committee not paid from reserves) and other items paid during such period: (1) operational cash disbursements and cash operating expenses; (2) current interest, principal and debt service paid on any indebtedness of the Company; (3) cash expenditures for capital improvements and other capital items; and (4) a reasonable allowance for reserves, contingencies and anticipated obligations as determined by the Management Committee; provided , Operating Proceeds shall not include any cash arising from refinancing of debt.

(DD) “ Percentage Interest ” means, with respect to a Member, the percentage set forth opposite such Member’s name on Exhibit A hereto, as may be updated from time to pursuant to Section 2.1 .

(EE) “ Permit ” means any license, permit, registration, concession, franchise, certificate of authority or order, certificate of occupancy, certificate of approval, approval, authorization or any waiver of the foregoing, issued by any Governmental Entity.

(FF) “ Person ” means an individual, partnership, corporation, limited liability company, trust, governmental entity or other association.

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(GG) “ Profits ” and “ Losses ” means, for each Fiscal Year or other period, an amount equal to the Company’s taxable income or loss for such period determined in accordance with Code Section 703(a) (for this purpose, all items of income, gain, loss, deduction or credit required to be stated separately pursuant to Code Section 703(a)(1) will be included in taxable income or loss), with the following adjustments:

(1) Any income of the Company that is exempt from federal income tax and not otherwise taken into account in computing Profits or Losses pursuant to this definition of Profits and Losses shall increase the amount of such income or decrease the amount of such loss;

(2) Any expenditure of the Company described in Code Section 705(a)(2)(B) or treated as such pursuant to Treasury Regulation § 1.704-1(b)(2)(iv)(i), and not otherwise taken into account in computing Profits or Losses pursuant to this definition shall decrease the amount of such income or increase the amount of such loss;

(3) Gain or loss resulting from any disposition of Company asset with respect to which gain or loss is recognized for federal income tax purposes shall be computed with reference to the Gross Asset Value of the asset disposed of, rather than the adjusted tax basis of such assets;

(4) In lieu of the depreciation, amortization and other cost recovery deductions taken into account in computing such income or loss, Depreciation for such period shall be taken into account;

(5) To the extent an adjustment to the adjusted tax basis of any asset included in Company assets pursuant to Code Section 734(b) or Code Section 743(b) is required pursuant to Treasury Regulation § 1.704-1(b)(2)(iv)(m) to be taken into account in determining Capital Accounts as a result of a distribution other than in liquidation of a Membership Interest, the amount of such adjustment will be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases the basis of the asset) from the disposition of the asset and will be taken into account for the purposes of computing Profits and Losses;

(6) If the Gross Asset Value of any Company asset is adjusted in accordance with subsection (2) or subsection (3) of the definition of “Gross Asset Value,” the amount of such adjustment shall be taken into account in the taxable year of such adjustment as gain or loss from the disposition of such asset for purposes of computing Profits or Losses; and

(7) Notwithstanding any other provision of this definition, any items that are specially allocated pursuant to Section 4.2 shall not be taken into account in computing Profits or Losses.

The amounts of the items of Company income, gain, loss or deduction available to be specially allocated pursuant to Section 4.2 hereof will be determined by applying rules analogous to those set forth in this definition of Profits and Losses.

(HH) “ Proprietary Information ” – means: (a) all confidential or proprietary information of the Company, any Affiliate of the Company, a Member or any Affiliate of a

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Member, including business plans and strategies, financial information regarding the Company’s and its Affiliates’ businesses, customers, assets, contracts, accounts, books and relationships disclosed to or otherwise received by any Member or any of its Affiliates or representatives; and (b) any portion of any notes, analyses, compilations, studies, interpretations or other documents prepared by any Member or any of its Affiliates or representatives to the extent the same contain, reflect, are derived from, or are based upon, any of the information described in clause (a).

(II) “ Red Rock Bluff Property ” means that certain property, more particularly described in Exhibit C hereto and incorporated herein by this reference, purchased by the Company for the development of the Red Rock Bluff Timeshare Project.

(JJ) “ Red Rock Bluff Timeshare Project ” means that certain timeshare project to be developed on the Red Rock Bluff Property by the Company in accordance with the terms hereof.

(KK) “ Resort Interest Program ” shall mean any form of timeshare, interval interest, timeshare exchange, undivided interest program, timeshare club membership, points-based program, or occupancy program, whereby the use, occupancy or possession of real property or real property improvements has been made subject to a conveyance, use or occupancy or possession right, which circulates among purchasers according to a first come, first serve reservation system, or a floating or fixed time schedule on a periodic, re-occurring basis, over any period of time in excess of one (1) year in duration.

(LL) “ Timeshare Projects ” shall mean collectively the Big Cedar Timeshare Project and the Red Rock Bluff Timeshare Project, together with such other Resort Interest Programs as may be owned, developed and sold by the Company as determined by the Members from time to time.

(MM) “ Treasury Regulation ” means the final or temporary income tax regulation promulgated under the Code, as such regulations may be amended from time to time.

(NN) “ Unreturned Member Loan ” means, with respect to a Member as of any relevant determination date, the excess (if any) of (1) the aggregate amount of such Member’s Member Loans calculated on a net basis (i.e., net of any liabilities assumed by the Company or secured by any property contributed to the Company or secured by any property contributed to the Company in connection with any Member Loan) over (2) the aggregate amount of distributions previously made to such Member pursuant to Section 3.1(B) .

Section 1.9 Other Defined Terms . Each of the following terms shall have the meaning assigned to such term in the Section indicated:


Other Defined Terms

Term		Section

Additional Capital Contributions		2.2(A)
Annual Budget		6.9(C)
Approved Agreements		7.4
Bluegreen CEO		10.7(C)

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BP/Tracker Competitor		7.6(A)
Brand Licensing Fee		7.10(B)
Business		1.4(A)
Business Plan		6.9(C)
CEOs		10.7(C)
Company		Recitals
Company RFC Financing		2.6
Debtor Party		3.4(B)
Disproportionate Losses		4.1(B)(2)
Dissociating Member		9.2(A)
Dissociation Event		9.1(A)(4)
Dissolution Proceeds		9.3(B)
Dissolution Reserves		9.3(B)(3)
Effective Date		Recitals
Fiscal Year		5.2
Foreclosure Conveyance		2.6(C)
Foreign States		1.7(A)
Future Big Cedar Amenities		6.9(A)(1)
General Manager		6.4
Liquidation Event		9.1(A)
Management Committee		6.1(A)
Manager		6.1(A)
Marketing Fee		7.10(B)
Master Use and Development Plan		6.9(B)(8)
Member Party		6.12(A)
Member Loan		2.2(A)
Members		Recitals
Original Operating Agreement		Recitals
Original Project		Recitals
Participate		7.8(A)
Participation Offer Notice		7.8(C)
Proposed Project		7.8(A)
Red Rock Bluff Business Plan		6.9(B)(1)
Regulatory Allocations		4.2(D)
Repayment Date		2.6(E)
Restricted Area		7.6(C)(1)
RFC		2.6
RFC Loan		2.6
Tax Distributions		3.2(A)
Timeshare Owner Use		7.10(D)(1)
Transfer		8.1(A)
Winding-Up Member		9.3(B)

Section 1.10 References; Pronouns; Headings. Except as otherwise specifically indicated, all references to Section, Subsection or Article numbers refer to Sections, Subsections

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and Articles of this Agreement and all references to Exhibits refer to the Exhibits attached hereto. The words “include,” “includes,” and “including” shall be deemed to be followed by the phrase “without limitation.” The words “herein,” “hereof,” “hereunder,” and similar terms shall refer to this Agreement, unless the context otherwise requires. Captions contained in this Agreement in no way define, limit or extend the scope or intent of this Agreement. The definitions set forth in Section 1.8 and Section 1.9 shall apply equally to both the singular and plural forms of the terms defined. Whenever the context may require, any pronoun used herein shall include the corresponding masculine, feminine, and neuter forms.

ARTICLE 2. CAPITAL ACCOUNTS AND CONTRIBUTIONS; MEMBER LOANS

Section 2.1 Capital Contributions . On or prior to the Effective Date, each of the Members made Capital Contributions to the Company as set forth on Exhibit A hereto. The Management Committee shall update Exhibit A from time to time to reflect any Additional Capital Contributions and any Member Loans made by the Members, any change in the Members’ relative Percentage Interests, the admission of any additional Members, the Transfer of any Membership Interest and any other relevant events.

Section 2.2 Additional Capital Contributions; Additional Membership Interests .

(A) Notwithstanding any other provision in this Agreement, and subject to Section 2.2(B) , no additional Capital Contributions (“ Additional Capital Contributions ”) shall be permitted or required to be made by any Member except as unanimously agreed by the Members. The Members contemplate that any Additional Capital Contributions will be made in accordance with the Members’ then relative Percentage Interests; provided , the Members hereby agree that any loans by Member to the Company and/or if any Additional Capital Contribution made by a Member exceeds its proportionate share, the amount of such excess or loans shall be a “ Member Loan ” entitled to the preferences and priorities set forth in this Agreement.

(B) Additional Capital Contributions or a Member Loan are permitted to be made without unanimous agreement of the Members only to enable the Company to satisfy a then-existing contractual obligation that it would otherwise be unable to satisfy. Prior to any Additional Capital Contribution or Member Laon being made pursuant to this Section 2.2(B) , the Member proposing to make such Additional Capital Contribution or a Member Loan shall deliver written notice to the other Member, and give such Member the opportunity to make a portion of such Additional Capital Contribution or a Member Loan in accordance with such Member’s relative Percentage Interest. The repayment of Member Loans shall be first applied to Cumulative Loan Return, then to principle amount of Member Loans. Member Loans shall be repaid as provided in Sections 3.1 and 4.3 and to the extent not previously repaid as provided above, shall be repaid in full (including any Cumulative Loan Return) upon the later of 12 months after such Member Loan is made and demand by the Member to the Company.

(C) Additional Membership Interests may be created and issued to existing Members or to other Persons, and such other Persons may be admitted to the Company as Members, in each case only upon approval of all of the Members on such terms and conditions as the Members may unanimously determine in their sole discretion. The provisions of this

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Section 2.2(C) shall not apply to Transfers of Membership Interests or admissions of transferees in connection therewith, such matters being governed by Article 8 of this Agreement.

Section 2.3 Capital Accounts .

(A) The Company shall maintain on its books a Capital Account for each Member in accordance with this Section 2.3 . At any time, each Member’s Capital Account shall be equal to (1) such Member’s Capital Contributions, plus (2) such Member’s allocable share of Profits and any items in the nature of income or gain that are specially allocated to such Member pursuant to Section 4.2 , plus (3) the amount of any Company liabilities assumed by such Member or that are secured by any property distributed to such Member, minus (4) the amount of cash and the Gross Asset Value of any Company asset other than cash distributed to such Member, minus (5) such Member’s allocable share of Losses and any other items in the nature of deductions or losses that are specially allocated to such Member pursuant to Section 4.2 , and minus (6) the amount of any liabilities of such Member assumed by the Company or that are secured by any property contributed by such Member to the Company. The Members agree and acknowledge that their respective Capital Account balances as of November 30, 2007 are as set forth in Exhibit A hereto.

(B) If any Member transfers all or a portion of its Membership Interest in accordance with the terms of this Agreement, the transferee shall succeed to the Capital Account of the transferor to the extent such Capital Account relates to the portion of the Membership Interest so transferred.

(C) In determining the amount of any liability for purposes of Section 2.3(A) , Code Section 752(c) and any other applicable provisions of the Code and Treasury Regulations will be taken into account.

(D) This Section 2.3 and the other provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Treasury Regulation §§ 1.704-1(b) and 1.704-2 and shall be interpreted and applied consistently therewith. In the event that the Management Committee shall unanimously determine that it is prudent to modify the manner in which the Capital Accounts, or any credits or debits thereto, are computed in order to comply with such Treasury Regulations, the Management Committee (consenting or voting unanimously only) may make such modification, provided it is not likely to have a material effect on the amounts distributable to any Member upon the dissolution of the Company.

(E) The treatment of Member Loans and interest thereon shall be treated in accordance with applicable Laws and the Treasury Regulations, and such treatment shall be reflected in the determination of Profits, Losses, and Capital Accounts.

Section 2.4 Negative Capital Accounts . Notwithstanding anything to the contrary in this Agreement, no Member shall be required to make a Capital Contribution to the Company to restore a negative Capital Account on dissolution of the Company or otherwise.

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Section 2.5 Certain Limitations .

(A) Except as provided in the Agreement, no Member shall (1) be entitled to demand or receive the return of, all or any portion of such Member’s Capital Contributions or Capital Account balance, (2) be entitled to receive any interest or preferred return on its Capital Contributions or Capital Account balance, (3) have any priority over other Members as to distributions or (4) the right to withdraw any part of its Capital Contribution from the Company prior to its liquidation and termination pursuant to Article 9 hereof. Any unreturned Capital Contribution is not a liability of the Company or of any Member, and no Member is required to contribute or to lend any cash or property to the Company to enable the Company to return any Member’s Capital Contributions.

(B) The rights and obligations of the Members under this Article 2 are for the exclusive benefit of the Members, and no creditor or other Person having dealings with the Company shall have any right or claim hereunder.

(C) Each Member hereby waives any right of partition and all other rights otherwise available to such Member to sever its relationship with the Company or its interest in Company assets from the interests of other Members.

(D) Each Member hereby agrees that no Member shall have any appraisal rights under Section 18-210 of the Act.

(E) Except as otherwise provided in this Agreement, or as may be provided in any separate agreement between the Company and a Member or an Affiliate of a Member, each Member shall bear its own costs and expenses in dealings with the Company.

Section 2.6 RFC Loan . The Members acknowledge and agree that (i) the Company has obtained financing (the “ Company RFC Financing ”) under a master line of credit (the “ RFC Loan ”) obtained by Bluegreen from Residential Funding Company, LLC (“ RFC ”); (ii) BC has guaranteed the Company’s payment and performance of the Company RFC Financing; and (iii) certain provisions of the RFC Loan may permit RFC to foreclose on certain Business Property if Bluegreen or its Affiliates default under a portion of the RFC Loan other than the Company RFC Financing. In connection with the Company RFC Financing, the Members agree that:

(A) Bluegreen shall have the right to amend or modify the RFC Loan in such manner as it determines in its sole and absolute discretion; provided , any modification of the Company RFC Financing shall be subject to the prior written approval of BCLLC, and provided further that any amendment or modification of the Company RFC Financing that would have a material adverse effect on the Company or BCLLC shall require the prior written approval of BCLLC recognizing that Bluegreen shall be responsible for all other obligations in connection with the RFC Loan other than with respect to the Company RFC Financing.

(B) In the event BC is required to pay any liability of the Company in connection with the Company RFC Financing or other financing transaction that has been approved by both Members pursuant to BC’s guarantee thereof, if any, then such payment shall be treated as a Member Loan and BCLLC shall reimburse BC for a percentage of such liability

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equal to BCLLC’s Percentage Interest. Upon delivery of written notice from BC to the Company and BCLLC that any amounts due from BCLLC to BC pursuant to this Section 2.6(B) are more than fifteen (15) days overdue, which notice shall set forth the amounts due and include evidence of payment to RFC (or other lender in the case of another financing that has been approved by both Members) by BC, the Company shall pay any distributions (other than Tax Distributions) otherwise payable to BCLLC, directly to BC until the aggregate amount of such distributions equals the amount (principal and interest) due from BCLLC to BC pursuant to this Section 2.6(B) , and Bluegreen or BC shall be entitled to offset against any monies owed to BCLLC or its Affiliates any sums owed by BCLLC to BC, Bluegreen or the Company.

(C) In the event that RFC forecloses on any Business Property for any reason other than a Company default under the Company RFC Financing, then Bluegreen and BC shall be obligated, jointly and severally, to pay to BCLLC, on the date that as a result of such foreclosure the Company Property is sold, foreclosed, or otherwise conveyed by the Company (a “ Foreclosure Conveyance ”), 49% of the greater of: (i) the fair market value of such Company Property, as determined at the time of such Foreclosure Conveyance; and (ii) the sale price of such Company Property in a Foreclosure Conveyance.

(D) The Company shall use its reasonable best efforts to comply with all terms and provisions of the RFC Loan.

(E) The Members acknowledge and agree that in the event the Company does not for any reason pay off the Company RFC Financing on or before such RFC Financing is required to be paid off pursuant to its terms (the “ Repayment Date ”), then the Members shall, (i) pro rata and in accordance with their respective Percentage Interests, make an Additional Capital Contribution on or before the Repayment Date sufficient to enable the Company to pay off the Company RFC Financing and (ii) cause the Company to take such other actions as are reasonably required to pay off the Company RFC Financing on or before the Repayment Date. If either member fails to make its Additional Capital Contribution required pursuant to this Section 2.6(E) , the other Member shall be entitled to contribute such amount to the Company as an agreed Member Loan.

Section 2.7 Other Loans by Members or Affiliates . No Member shall be required to make any loans or otherwise lend any funds to the Company; provided , subject to obtaining any requisite approvals required under this Agreement for the Company to borrow funds, any Member or its Affiliate may (but shall not be obligated to) at any time, upon approval of the Management Committee, loan money or guarantee a loan to the Company to finance Company operations, to finance or refinance any assets of the Company, to pay the debts and obligations of the Company, or for any other Company purpose. Notwithstanding the foregoing, the Company may incur payables or receivables to or from the Members in connection with transactions in the ordinary course of business for any services provided or goods acquired or sold, provided , such payables shall not be treated as Member Loans and provided , further, that the Member so engaging in transactions with or on behalf of the Company shall provide to the other Member a monthly accounting of all such transactions. If any Member or its Affiliate lends funds or guarantees a loan of funds to the Company as provided in this Section 2.7 , such Member or Affiliate shall be entitled to receive interest on such loan, and shall be entitled to receive a fee for guaranteeing any such loan, as may be agreed upon by the Members on behalf of the Company.

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Section 2.8 Accounting . Notwithstanding anything to the contrary in this Agreement, the Company shall prepare and maintain its financial statements in accordance with generally accepted accounting principles.

ARTICLE 3. DISTRIBUTIONS

Section 3.1 Distributions of Operating Proceeds . Except as provided in Section 3.2 (regarding Tax Distributions) and Article 9 (regarding liquidating distributions), Operating Proceeds shall by distributed to the Members at such times as the Management Committee shall determine (but not less frequently than annually) in accordance with the following priorities:

(A) First, to the Members having made Member Loans, in proportion and to the extent of each such Member’s unpaid Cumulative Loan Return;

(B) Second, to the Members having made Member Loans, in proportion and to the extent of each such Member’s Unreturned Member Loan; and

Section 3.2 Tax Distributions .

(A) Other than at liquidation of the Company, if and to the extent there are Operating Proceeds, the Management Committee shall cause the Company to make quarterly distributions (“ Tax Distributions ”) to the Members for the purpose of enabling them to pay federal, state and local taxes on their respective distributive shares of the aggregate net taxable income of the Company. Tax Distributions shall be made by the Company at the appropriate times to allow the Members to make their estimated tax payments. Subject to Section 3.2(B) , the amount of Tax Distributions shall be equal to: (i) the cumulative net taxable income of the Company for the Fiscal Year (as estimated by the Management Committee), net of previously unrecouped tax losses of the Company, multiplied by (ii) a benchmark rate reflecting a composite federal, state and local income tax rate for the Members. The initial benchmark rate shall be 41%. The Management Committee may adjust the benchmark rate to reflect the then current status of the ordinary income and capital gains tax rates of the Code or other applicable Law.

(B) The amount of Tax Distributions made in any fiscal quarter will be reduced to take into account any distributions previously made during such fiscal year pursuant to Section 3.1 . If Operating Proceeds are not sufficient to satisfy the required Tax Distributions for a particular quarter, the Company will make up such deficit out of Operating Proceeds in future periods. If the total amount of Tax Distributions paid to the Members for a Fiscal Year exceeds the benchmark rate multiplied by the actual net taxable income of the Company for such Fiscal Year, the Tax Distributions for subsequent periods will be reduced by the amount of such overpayment.

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Section 3.3 Distributions to be Made in Cash . All distributions (including Tax Distributions) to the Members shall be made in cash, and no Member shall have any right to demand and receive property other than cash as provided in this Agreement. In no event shall any Member be compelled or permitted to accept a distribution of any property other than cash from the Company. If the Members unanimously determine that the Company should make an in-kind distribution of Company property to one or more Members, such Company property shall be distributed to the Members in accordance with this Article 3 and Article 9 , based on the fair market value of such property as determined by the Members.

Section 3.4 Withholding and Offset .

(A) The Company is authorized to deduct and withhold from distributions to a Member and to pay over to the appropriate foreign, federal, state or local government tax authority any amounts required to be withheld pursuant to the Code or any provisions of any other foreign, federal, state or local Law. Any amounts so deducted and withheld shall be treated as, and shall be credited against, Tax Distributions otherwise to be made to such Member.

(B) The Company may, upon notice to the affected Member (the “ Debtor Party ”), withhold from any distribution, other than a Tax Distribution, any amount due and payable to the Company by the Debtor Party or its Affiliates and which is not paid when due. Any amounts withheld to offset or satisfy any such obligations pursuant to this Section 3.4(B) shall be treated for all purposes of this Agreement as if such amounts had been distributed to the Debtor Party. The rights and remedies provided in this Section 3.4(B) are in addition to, and not in limitation of, any other rights and remedies provided under this Agreement or under applicable Law.

ARTICLE 4. ALLOCATION OF PROFITS AND LOSSES

Section 4.1 Profits and Losses .

(A) After giving effect to the special allocations set forth in Section 4.2 , Profits for any Fiscal Year shall be allocated as follows:

(1) First, to the Members in proportion and to the extent of any Losses allocated pursuant to Section 4.1(B)(4) ;

(2) Second, to the Members in proportion and to the extent of any Losses allocated pursuant to Section 4.1(B)(3) ;

(3) Third, to the Members in proportion and to the extent of any Disproportionate Losses allocated pursuant to Section 4.1(B)(2) ;

(4) Fourth, to the Members in proportion and to the extent of any Losses other than Disproportionate Losses allocated pursuant to Section 4.1(B)(2) ;

(5) Fifth, to the Members with Unreturned Member Loans until the cumulative Profits allocated to such Members equal the Cumulative Loan Return; and

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(6) Sixth, to the Members in accordance with their Percentage Interests.

(B) After giving effect to the special allocations set forth in Section 4.2 , Losses for any Fiscal Year shall be allocated as follows:

(1) First, to the Members to offset any allocations of Profits pursuant to Sections 4.1(A)(6) , and then to the Members to offset any allocations of Profits pursuant to Sections 4.1(A)(5) . To the extent any allocations of Profits pursuant to Section 4.1(A)(5) are offset by Losses, such Profit allocations shall be disregarded for purposes of computing subsequent Profit allocations;

(2) Second, to the Members in accordance with their Percentage Interests; provided , if the allocation of Loss would cause a Member to have an Adjusted Capital Account deficit (calculated without taking into account any Unreturned Member Loan of such Member), such Member shall be allocated only that amount of Loss as will reduce its Adjusted Capital Account balance (calculated without taking into account any Unreturned Member Loan of such Member) to zero. Loss that, absent application of the preceding sentence, would otherwise be allocated to such Member shall be allocated to the other Members subject to this Section 4.1(B)(2) . Losses disproportionately allocated pursuant to the preceding sentence of this Section 4.1(B)(2) are “ Disproportionate Losses ;”

(3) Third, to the Members with Unreturned Member Loan in proportion and to the extent of their Unreturned Member Loan; provided , if the allocation of Loss would cause a Member to have an Adjusted Capital Account deficit, such Member shall be allocated only that amount of Loss as will reduce its Adjusted Capital Account balance to zero; and

(4) Fourth, to the Members in accordance with their Percentage Interests.

Section 4.2 Regulatory and Curative Allocations . Notwithstanding the provisions of Section 4.1 :


	(A) In order to comply with Treasury Regulation §§ 1.704-1(b) and 1.704-2, the minimum gain chargeback requirements in Treasury Regulation § 1.704-2(f) and 1.704-2(i)(4) are hereby incorporated in this Agreement. In addition, notwithstanding anything else in this Article 4 , (i) deductions associated with Company nonrecourse liabilities described in Treasury Regulation § 1.704-2(c) shall be allocated in accordance with Percentage Interests, and (ii) deductions associated with Member nonrecourse liabilities described in Treasury Regulation § 1.704-2(i)(1) shall be allocated to the Member or Members who bear the economic risk of loss with respect to the Member nonrecourse liability to which such deductions are attributable, in accordance with Treasury Regulation § 1.704-2(i).

	(B) If any Member unexpectedly receives an adjustment, allocation or distribution of the type contemplated by Treasury Regulation § 1.704-1(b)(2)(ii)(d)(4), (5) and (6) that causes such Member to have an Adjusted Capital Account deficit, items

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	of income and gain shall be allocated to all such Members (in proportion to the amounts of their respective Adjusted Capital Account deficits) in an amount and manner sufficient to eliminate the deficit balances in such Members’ Capital Accounts that are in excess of such Members’ respective Adjusted Capital Account deficits, as quickly as possible. It is intended that this Section 4.2(B) qualify and be construed as a “qualified income offset” within the meaning of Treasury Regulation § 1.704-1(b)(2)(ii)(d).

	(C) To the extent an adjustment to the adjusted tax basis of any Company asset pursuant to Code Section 734(b) is required, pursuant to Treasury Regulation §§ 1.704-1(b)(2)(iv)(m)(2) or 1.704-1(b)(2)(iv)(m)(4), to be taken into account in determining Capital Accounts as the result of a distribution to a Member in complete liquidation of its Membership Interest, the amount of such adjustment to the Capital Accounts shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis) and such gain or loss shall be specially allocated to the Members in accordance with their interests in the Company in the event that Treasury Regulation § 1.704-1(b)(2)(iv)(m)(2) applies, or to the Members to whom such distribution was made in the event that Treasury Regulation § 1.704-1(b)(2)(iv)(m)(4) applies.

	(D) The allocations set forth in Sections 4.2(A)–(C) (the “ Regulatory Allocations ”) are intended to comply with certain requirements of Treasury Regulation §§ 1.704-1(b) and 1.704-2. The Regulatory Allocations may not be consistent with the manner in which the Members intend to distribute the cash of the Company or allocate Company income or loss. Accordingly, the Management Committee is hereby authorized to allocate items of income, gain, loss and deduction to the Members so as to prevent the Regulatory Allocations from distorting the manner in which Company distributions will be divided among the Members. In general, the Members anticipate that this will be accomplished by specially allocating other items of income, gain, loss and deduction to the Members so that, to the extent possible, the net amount of such allocations and the Regulatory Allocations to the Members shall be equal to the net amount that would have been allocated among the Members if the Regulatory Allocations had not occurred. However, the Management Committee shall have discretion to accomplish this result in any reasonable manner, and in exercising this discretion, the Management Committee shall take into account future Regulatory Allocations under Section 4.2(A) that, although not yet made, are likely to offset other Regulatory Allocations previously made thereunder.

Section 4.3 Tax Allocations . To the maximum extent possible, all items of Company income, gain, loss and deduction for federal income tax purposes shall be allocated among the Members for such purposes in the same manner in which the corresponding items computed for Capital Account purposes are allocated pursuant to Sections 4.1 and 4.2 . Tax items with respect to Company property that is contributed to the Company with a Gross Asset Value that varies from its federal income tax basis in the hands of the contributing Member immediately preceding the contribution shall be allocated among the Members for federal income tax purposes pursuant to Treasury Regulations promulgated under Code Section 704(c) so as to take into account such variation. The Company shall account for any such variation under any method approved under Code Section 704(c) and the applicable Treasury Regulations as chosen by the Management

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Committee. If the Gross Asset Value of any Company asset is adjusted as provided in this Agreement, subsequent allocations of income, gain, loss and deduction with respect to such asset shall take account of any variation between the adjusted basis of such asset for federal income tax purposes and its Gross Asset Value in the same manner as under Code Section 704(c) and the Treasury Regulations promulgated thereunder. Any elections or other decisions relating to the allocations in this Section 4.3 shall be made by the Management Committee in a manner that reflects the purpose and intention of this Agreement. Allocations pursuant to this Section 4.3 are solely for purposes of federal, state and local taxes and shall not affect, or in any way be taken into account in computing any Member’s Capital Account or share of Profits, Losses and any other items or distributions pursuant to any provision of this Agreement.

Section 4.4 Other Allocation Rules . For purposes of determining the Profits, Losses and any other items of income, gain, loss and deduction allocable to any period, Profits, Losses and any such other items will be determined on a daily, monthly or other basis, as determined by the Management Committee using any permissible method under Code Section 706 and the Treasury Regulations thereunder.

ARTICLE 5. ACCOUNTING AND TAX MATTERS

Section 5.1 Accounting Methods; Company Records .

(A) The Company’s books and records shall be prepared in accordance with generally accepted accounting principles, consistently applied, except that the Capital Accounts of the Members shall be maintained as provided in this Agreement. An annual audit shall be conducted by an audit firm unanimously approved by the Management Committee, which audit shall be completed at the cost of the Company, no later than ninety (90) days after the Company’s Fiscal Year. The Company shall use the accrual method of accounting for both tax and accounting purposes.

(B) The Company will deliver to each Member, (i) within ninety (90) days after the end of each Fiscal Year, audited financial statements of the Company, which shall include a balance sheet of the Company as of the end of such year, statements of income and expense and cash flow of the Company for such Fiscal Year, and a statement of members’ equity, each prepared in accordance with GAAP and including notes with respect thereto, all in reasonable detail, (ii) as soon as practicable after the end of each fiscal month and in any event within twenty (20) days thereafter, an unaudited balance sheet of the Company as of the end of such month, and statements of income and expense and cash flow of the Company for such month and for the year to date, prepared in accordance with GAAP and including notes with respect thereto, all in reasonable detail, and mortgage receivable portfolio statements and any other reports as may be reasonably requested by a Member.

(C) The Management Committee shall cause the Company to comply with all record keeping requirements imposed by the Act, and shall provide each Member with the opportunity to inspect and copy such records (at such Member’s expense), at reasonable intervals, during ordinary business hours. Except as provided in this Agreement, neither the Management Committee nor any Member shall have any obligation to provide to any other

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Member a copy of the Certificate of Formation or any other document filed with the Delaware Secretary of State or other governmental authority on behalf of the Company.

Section 5.2 Fiscal Year . The fiscal year of the Company (the “ Fiscal Year ”) shall be the calendar year or such other year as may be determined by the Management Committee or required by the Code.

Section 5.3 Bank Accounts; Title to Business Property . The funds of the Company shall be deposited in such bank accounts, or invested in such interest-bearing or non-interest-bearing investments in the Company’s name, as shall be determined by the Management Committee. The funds of the Company shall not be commingled with the funds of any other Person and the Management Committee shall not employ, or permit or cause any other Person to employ such finds in any manner except for the benefit of the Company. Title to the Business Property shall be held, and conveyances thereof shall be made, in the name of the Company. Each bank account shall have provided thereon signatures of the Company or such parties as designated by the Management Committee.

Section 5.4 Tax Matters .

(A) All federal, state and local tax returns of the Company shall be prepared by certified public accountants selected by the Management Committee. The Management Committee shall furnish to each Member copies of all such returns promptly after their filing. To the extent permitted by applicable Law, each Member shall take reporting positions on their respective income tax returns consistent with the positions determined for the Company by the Management Committee.

(B) The Management Committee shall make all applicable elections, determinations and other decisions for the Company relating to tax matters, including the positions to be taken on the tax returns of the Company, the settlement or further contest and litigation of any audit matters raised in connection with any tax return, extensions of applicable statutes of limitations, filing requests for administrative adjustment for the Company and filing suit concerning any tax refund or deficiency relating to any administrative adjustment; provided , in the case of a Transfer of a Membership Interest permitted under this Agreement, upon the request of the transferee of such Membership Interest, the Company shall file an election under Code Section 754 pursuant to the Treasury Regulations applicable thereto. Bluegreen shall be the initial “tax matters partner” within the meaning of Code Section 6231(a) and shall take any action as may be necessary to cause each other Member to become a “notice partner” within the meaning of Code Section 6223.

(C) Any provision of this Agreement to the contrary notwithstanding, solely for federal and state income tax purposes, each party hereto recognizes and acknowledges that it is the Members’ intention that the Company will be a limited liability company classified as a partnership for federal income tax purposes and subject to all provisions of Subchapter K of Chapter 1 of Subtitle A of the Code; provided , however , the filing of federal and state income tax returns shall not be construed to extend the purposes or expand the obligations or liabilities of the Company, nor shall it be construed to create a partnership (other than for tax purposes) or any other agency relationship between the Members. Any provision of this Agreement to the

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contrary notwithstanding, the Company shall not make any election to be treated for federal or state income tax purposes as other than a partnership without the unanimous approval of the Members.

ARTICLE 6. MANAGEMENT AND BUSINESS POLICIES

Section 6.1 Management by Management Committee.

(A) Subject to the provisions of the Act and the terms of this Agreement, including, without limitation, Section 6.7 through and including Section 6.12 , the business and affairs of the Company shall be managed under the direction and control of a management committee (the “ Management Committee ”) which shall consist of three (3) individuals (each, a (“ Manager ”), who need not be Members.

(B) At all times and for all purposes, Bluegreen shall have the irrevocable power, authority and right to appoint two (2) Managers and BCLLC shall have the irrevocable power, authority and right to appoint one (1) Manager. Those Members so empowered may remove and replace their designated Manager(s) on written notice to all Members. As of the Effective Date, the Managers appointed by Bluegreen are David Pontius and Terry Dodd and the Manager appointed by BCLLC is James A. Hagale.

(C) Except as otherwise expressly provided in this Agreement, any action or decision permitted or required to be taken by the Management Committee shall require the approval of two (2) of the Managers.

(D) The Management Committee is hereby authorized and directed to do or cause to be done on behalf of the Company all such actions (including the payment of fees and expenses) and to make, execute, and/or deliver or cause to be made, executed and/or delivered all such contracts, instruments, documents, agreements, writings, or communications as the Management Committee, in its discretion, deems necessary, advisable or appropriate for the Company to carry on the Business.

(E) The Management Committee (i) may designate one or more of the Managers to act alone in respect of any Company matter or determination; or (ii) delegate to one or more Persons, including officers, who may or may not be Managers, ministerial authority to conduct the day-to-day operations of the Company.

(F) Unless otherwise so delegated by the Management Committee or set forth herein, no Member shall have any right or power to act for or on behalf of the Company or make decisions with respect thereto. Decisions of the Management Committee within its scope of authority shall be binding upon the Company and each Member.

Section 6.2 Meetings of the Management Committee . Unless otherwise expressly provided in a written notice, meetings of the Management Committee shall be held at the principal place of business of the Company or at any other place that a majority of the Managers determines. In the alternative, meetings may be held by telephone conference in which each Manager can participate. The presence of a majority (by number) of the Managers shall constitute a quorum for the transaction of business. Meetings shall be held (i) as determined by

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the Management Committee, or (ii) as requested by any Manager. Meetings shall be held at least twice per Fiscal Year. Any meetings of the Management Committee shall be held upon at least two (2) business days’ prior written notice delivered by the General Manager to all of the Managers. Such notice shall specify the time and place of such meeting and the purpose for such meeting. Minutes of each meeting and a record of each decision shall be kept by the designee of the Management Committee and shall be given to all of the Members promptly after the meeting.

Section 6.3 Action by Written Consent Without a Meeting . Unless otherwise restricted by this Agreement, any action required or permitted to be taken at any meeting of the Management Committee may be taken without a meeting if those Managers having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting consent thereto in writing and all Managers receive notice of such action proposed to be taken not less than two (2) business days prior nor more than thirty (30) days prior to the taking of such action (it being agreed that the failure to provide such notice shall not constitute a material breach of or default under this Agreement), and the writing or writings are filed with the minutes of the Management Committee and given to the Members promptly after the meeting.

Section 6.4 General Manager . Except as otherwise unanimously determined by the Members, the Company shall have a general manager (the general manager, or any successor thereto, being hereinafter collectively referred to as the “ General Manager ”) to supervise the day-to-day operations of the Company. The General Manager shall be subject to the general supervision and control of the Management Committee and shall carry out the policy decisions made by the Management Committee. At each regular meeting of the Management Committee (and, when requested by any member thereof, at any special meeting of the Management Committee), the General Manager shall be present and shall report to the Management Committee on the operations of the Company or any other matters as any member of the Management Committee may request. The General Manager shall be a full-time employee of the Company. The Management Committee shall appoint, remove and replace the General Manager at any time and for any reason (or no reason). The General Manager as of the Effective Date shall be Howard Kitchen.

Section 6.5 Specific Authority of Management Committee and General Manager . Subject to such other rights expressly granted to the Members, and other limitations hereunder, including as set forth in Section 6.7 through and including Section 6.12 , the Management Committee, or the General Manager if the Management Committee expressly empowers the General Manager, is hereby specifically authorized for, and in the name of and on behalf of the Company:

(A) To manage and supervise the operations of the Business Property, including supervision of the acquisition, storage and processing of inventory, oversight of staffing and employment matters and establishing policies for the conduct of the Business;

(B) To execute and deliver all instruments necessary or convenient in connection with the management, maintenance and operation of the Business Property;

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(D) To engage in business with any Person who provides any services to, sells property to or purchases property from, the Company (subject to the other restrictions of this Agreement);

(E) To retain or employ and coordinate the services of employees, supervisors, accountants (provided, however, that the audit firm referenced in Section 5.1(A) shall be retained or employed only upon unanimous approval of the Management Committee), attorneys, and other Persons necessary or appropriate to carry out the Business;

(F) To establish and fund, out of the Company’s gross receipts or otherwise, such reserves for anticipated or contingent liabilities and working capital as the Management Committee reasonably deems appropriate and to reverse any such reserves not required;

(G) To engage in any kind of activity and to perform and carry out such contracts of any kind necessary to, or in connection with, or incidental to the accomplishment of, the Business;

(H) To handle all matters in connection with the construction of improvements to be constructed on the Business Property;

(I) To perform all other duties and functions determined in the discretion of the Management Committee from time to time;

(J) Subject to Section 7.10, to accept instruments of indebtedness from consumer purchasers of timeshare interests and to sell or hypothecate such timeshare interests under any arrangements as may be established by the Management Committee on behalf of the Company, on such terms as may, from time to time, be acceptable to the Management Committee and to further pledge or sell collateral related to such timeshare interests to such third party financier as may be determined from time to time by the Management Committee;

(K) Subject to Section 7.10(C ), to establish sales prices for timeshare interests and to sell or hypothecate timeshare receivables under any arrangements as may be established by the Management Committee on behalf of the Company, on such terms as may, from time to time, be acceptable to the Management Committee and to further pledge or sell collateral related to such timeshare interests or receivables to such third party financier as may be determined from time to time by the Management Committee;

(L) To execute and deliver, in furtherance of any or all of the purposes of the Company, any deed, lease, mortgage, promissory note, bill of sale, contract or other instrument effecting the conveyance, exchange or encumbrance of all or any part of the Business Property (unless not in the ordinary course of business), or any interest therein, either to or from the Company, for the purpose of carrying on the Business and, subject to Section 7.4 , to agree pursuant to written contract with others so to do, particularly by way of example and not limitation, subject to Section 7.4 , to agree pursuant to written contract with others to convey and transfer timeshare interests in the Timeshare Projects, and otherwise, subject to Section 7.4 , to agree pursuant to written contract with third parties for purposes of carrying out receivable financing transactions, including endorsement of consumer notes, assignment of consumer

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mortgages or deeds of trust, and related documentation, to effectuate receivable financing as it relates to timeshare interest sales; and

(M) To engage any and all personnel who, from time to time, may be determined by the Management Committee necessary or desirable to advance the Company or the Business of the Company.

Section 6.6 Certificate . Any Person dealing with the Company or the Management Committee may rely upon a certificate signed by a majority of the Management Committee as to (i) the identity and authority of the General Manager; (ii) authorization to conduct any business on behalf of the Company; (iii) the identity and authority of any representative or agent of the Company for purposes of carrying on the business and affairs of the Company, including but not limited to, sales and marketing of timeshare interests and the hypothecation, sale and endorsement of evidences of indebtedness as respects the sale of timeshare interests and collateral related thereto; or (iv) any matter upon which the Management Committee may set forth on such certificate, including any matter in respect to which the Management Committee may take action regarding sales and marketing of timeshare interests and involvement of third parties for financing respecting such timeshare interests, whether by hypothecation or sale.

Section 6.7 Restrictions on Authority of the Management Committee and the General Manager . In addition to the limitations set forth elsewhere herein, neither the Management Committee nor the General Manager shall undertake or cause the Company to undertake any of the following without the unanimous consent of all Members:

(A) Do any act in contravention of this Agreement;

(B) Sell, lease, exchange, transfer, encumber or otherwise dispose of the Big Cedar Timeshare Property or the Red Rock Bluff Property (other than in the ordinary course of the Business);

(C) Except as specifically approved herein, borrow any monies, including from a Member, refinance any loan, make any modifications to the Company RFC Financing, or assign any of the assets of the Company as collateral for a loan, other than in the ordinary course of business;

(D) Assign any assets for the benefit of creditors or cause the Company to file a voluntary petition in bankruptcy or take any other similar action;

(E) Admit additional or substitute Members to the Company except as otherwise provided herein;

(F) Cause the Company to merge or consolidate with or into any other entity, or change or reorganize the Company into any other legal form;

(G) Cause the Company to engage in any business other than the Business or extend the scope of the Business, by implication or otherwise;

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(H) Acquire any real estate or any interest therein (other than the Big Cedar Timeshare Property or the Red Rock Bluff Property), or acquire any other property or assets not related to the Business;

(I) Effect the sale or transfer of all or substantially all of the Business Property other than the sale of assets in the ordinary course of the Company’s business;

(J) Make any expenditure not in the ordinary course of business, which expenditure will be considered “capital” in nature under generally acceptable accounting principles, if such expenditure would be a departure (including, but not limited to, a departure in cost or nature of expenditure) from the Annual Budget or the Business Plan;

(K) Except in the ordinary course of business, modify the Annual Budget or the Business Plan or incur any expense not provided for in the Annual Budget or the Business Plan;

(L) Except for the Approved Agreements, enter into any agreement with Bluegreen or any Affiliate of Bluegreen,

(M) Authorize any act that would make it impossible to carry on the ordinary business of the Company;

(N) Attempt to dissolve or withdraw from the Company except as provided for in this Agreement;

(O) Confess any judgment against the Company or settle or adjust any claims against the Company; provided , without approval of BCLLC, the Management Committee may settle or adjust claims against the Company if the out-of-pocket expenses for the Company (net of any amounts covered by insurance) with respect to any one claim, or any one series of related claims, do not exceed $25,000;

(P) Except as is already in place with any existing Company financing, obligate the Company or any Member as a surety, guarantor or accommodation party to any obligation;

(Q) File or otherwise institute any lawsuit or other proceeding where the amount in controversy exceeds $25,000;

(R) Except for the Approved Agreements, as set forth in the Annual Budget, or as otherwise in the ordinary course of business, enter into any contract or agreement pursuant to which the aggregate payments expected to be made by the Company thereunder exceed $10,000;

Section 6.8 Insurance .

(A) Specific policies of insurance shall be obtained by the Company as approved by the Management Committee, and shall include, but not be limited to the following.

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The Management Committee shall cause any such insurance policies to name each of the Members as additional insureds:

(1) Commercial or comprehensive general liability insurance in a combined single limit of not less than $5,000,000 for bodily injury, contractual liability, broad form property damage, personal injury and such other risks as are reasonably determined by the Management Committee;

(2) Workers’ compensation insurance, providing statutory limits for coverage A and limits of at least $1,000,000 for coverage B (employers’ liability);

(3) Business auto, including owned, hired and non-owned coverage, with limits of at lease $1,000,000;

(4) All risks builders risk/property coverage for construction projects, including interests of the Company, contractors and financial parties as their interests may appear;

(5) Crime coverage, including the management and salespersons of the Company;

(6) Directors & officers’ liability insurance;

(7) Business interruption insurance; and

(8) Umbrella/excess liability, in the name of the Company, with limits of not less than $25,000,000 on a pro forma basis.

(B) The Company shall require the following to be in place for any independent contractors having any activity regarding the construction of the Timeshare Projects:

(1) A certificate of insurance indicating minimum limits of $1,000,000 per occurrence for commercial or comprehensive general liability (including contractual and completed operations liability coverages) and that coverage is on an occurrence form;

(2) A certificate of insurance indicating statutory workers’ compensation coverage and $1,000,000 minimum of employers’ liability coverage;

(3) A certificate of insurance indicating a minimum of $1,000,000 per occurrence for business auto liability (including owned, hired and non-owned coverage); and

(4) A certificate of insurance indicating builders all risk coverage (including items in transit), contractors equipment coverage (including coverage for owned, leased or rented equipment), and an installation floater (with all such coverages insuring full or replacement value of materials and equipment at risk).

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Each certificate referenced in this Section 6.8(B) must show the Company and the Members have been endorsed on the policy as additional insureds under the general liability and on any umbrella/excess coverage carried and that all policies contain a full waiver of subrogation against the Company and the Members, and a copy of policy endorsement showing additional insured status, waiver of subrogation, and any other special policy provisions which may exclude or limit the Company’s or the Members’ additional insured position must be attached to the certificate.

All insurance required of an independent contractor hereunder shall be primary and non contributory with respect to any other insurance available to the Company and the Members. Any and all deductibles and/or self insured retentions shall be assumed by and be for the account of and at the sole risk of the independent contractor. All insurance costs are for the account of the independent contractor and shall not be passed onto the Company or the Members. Higher limits and/or lower deductibles or self insured retentions may be required for certain contractors or on certain projects as unanimously determined by the Management Committee. Each certificate referenced in this Section 6.8(B) must indicate a firm thirty (30) day notice of cancellation or change, and shall be mailed to Risk Management Department, 2500 E. Kearney, Springfield, MO 65898 annually upon policy renewal and at any time requested by BCLLC. Certified copies of all policies shall be furnished to any member upon request.

Section 6.9 Business Plans and Budgets; Amenity Development . The Members shall cooperate in good faith to continue development of timeshare units and amenities at the Big Cedar Timeshare Project and the Red Rock Bluff Timeshare Project on such budgets and timelines, and to such specifications, as provided herein and or as otherwise agreed by the Members (provided that the Management Committee shall have the authority to approve the Annual Budget, Business Plan, and ordinary course of business deviations from such budget and plan). In furtherance thereof, the Members agree as follows:

(A) Big Cedar Design and Amenity Development .

(1) Future timeshare units at the Big Cedar Timeshare Project shall be designed and constructed so that the quality of any new villa units and cabins are comparable to the existing villa units and cabins at the Big Cedar Timeshare Project.

(2) The Company shall be required to invest an additional amount of Ten Million Dollars ($10,000,000) (or such greater or lesser amount as agreed by all of the Members) for the development of additional amenities and facilities for the Big Cedar Timeshare Project (the “ Future Big Cedar Amenities ”). BCLLC shall have ultimate approval rights as to design and construction of the Future Big Cedar Amenities. The Future Big Cedar Amenities shall be completed within eighteen (18) months of the date that both BCLLC and Bluegreen have approved the final design plan of such amenities and facilities. The foregoing investment shall be funded without any Additional Capital Contributions by the Members (unless otherwise unanimously agreed by all Members).

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(B) Red Rock Bluff Development.

(1) Attached hereto as Exhibit D is a business plan, having upon execution hereof been agreed to by the Members, which forecasts the life of the Red Rock Bluff Timeshare Project (the “ Red Rock Bluff Business Plan ”). It is agreed that this Red Rock Bluff Business Plan is solely a projection, without representation or warranty, express or implied.

(2) Notwithstanding any other provision hereof to the contrary, the Red Rock Bluff Timeshare Project shall be developed in accordance with the Red Rock Bluff Business Plan.

(3) All future expenses in respect to the acquisition, development, design construction, operation, management, marketing and sale of the Red Rock Bluff Timeshare Project are the obligations of and shall be paid by the Company. The amount set forth on Schedule 1 hereto for the corresponding incurred expenses set forth on Schedule 1 hereto, shall constitute an agreed Member Loan of Bluegreen as of the Effective Date, and represents actual amounts previously expended by Bluegreen in connection with the Red Rock Bluff Timeshare Project.

(4) Except as set forth in Section 2.2(B), no Member shall be entitled to any reimbursement of any amounts expended in connection with the acquisition, development, design construction, operation, management, marketing and sale of the Red Rock Bluff Timeshare Project unless all Members have consented in writing, recognizing that Bluegreen may reimburse itself for expenses incurred on behalf of the Company as provided in Section 2.7 , so long as Blugreen provides to BCLLC a monthly accounting of all such reimbursements as required by Section 2.7 .

(5) The Members and the Management Committee shall cause the Company to develop and construct all amenities and facilities necessary to support the full development of the Red Rock Bluff Timeshare Project, in a design and on a timeline consistent with the Red Rock Bluff Business Plan or as otherwise agreed upon by Bluegreen and BCLLC.

(6) The Red Rock Bluff Timeshare Project shall be designed and constructed so that the quality of the timeshare units are comparable in quality to the existing villa units and cabins at the Big Cedar Timeshare Project.

(7) BCLLC shall have ultimate approval rights as to design and construction of the Red Rock Bluff Timeshare Project. The Red Rock Bluff Timeshare Project shall be completed as expeditiously as possible.

(8) Bluegreen and BCLLC shall agree on a “ Master Use and Development Plan ” for the Red Rock Bluff Timeshare Project. The Master Use and Development Plan shall initially be prepared by Bluegreen, at the expense of the Company within ninety (90) days of the date hereof. Such Master Land Use and Development Plan shall provide that the architectural design and product quality of the Red Rock Bluff Timeshare Project which shall be consistent with and complementary to the architectural and product quality of the existing Big Cedar Timeshare Project.

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(C) Business Plan and Annual Budget . Bluegreen shall, on an annual basis, and no less than thirty (30) days prior to the beginning of the next Fiscal Year, propose a business plan to the Management Committee for carrying out the Business both on an annual basis and on a rolling three (3) year basis as set forth below (the “ Business Plan ”) and an accompanying annual budget (the “ Annual Budget ”), which shall be itemized in reasonable detail, contain a balance sheet, projections (which projections shall include projections on financing income for mortgages, including any projection which includes the sale of mortgage receivables), income statement and cash flow projections and, in all events, account for the Big Cedar Timeshare Project and the Red Rock Bluff Timeshare Project. The Management Committee shall consider and make any revisions it deems appropriate to the Business Plan and Annual Budget as received from Bluegreen, and present the same for approval to the Members within fifteen (15) days of receipt.

As part of the Business Plan, Bluegreen shall formulate and deliver to the Management Committee a rolling three (3) year business plan for the Business, containing a balance sheet, projections (which projections shall include projections on financing income for mortgages, including any projection which includes the sale of mortgage receivables) and budgets with respect to revenues, expenses, operating cash flows, capital expenditures, financing, market priorities and funding required in each case for the Projects for the following Fiscal Year, the life of the Projects, or such other period with respect to certain matters as may be set out therein. It is agreed that such portion of the Business Plan is solely a projection, without representation or warranty, express or implied. The Business Plan will estimate all funding and identify proposed funding sources. The current Business Plan, which shall also be effective for the fiscal year 2008, is attached hereto as Exhibit F .

(1) The Business Plan and Annual Budget shall be adopted by the Company only upon approval of the Management Committee. The Business Plan and Annual Budget for the current fiscal year, which shall also be effective for the fiscal year 2008, are attached hereto as Exhibit F and Exhibit G , respectively, the same having been adopted and approved by the Management Committee.

(2) Subject to Section 2.2 , a Business Plan may propose (but cannot require) that the Members make Additional Capital Contributions or Member Loans in such amounts and at such times as shall be set forth in the relevant Business Plan.

Section 6.10 Big Cedar Approval Rights . Notwithstanding the foregoing, BCLLC shall have the ultimate discretion to approve the schematic floor plans, building elevation plans and interior design concepts as the same relate to the Timeshare Projects.

Section 6.11 Meetings and Voting by Members.

(A) Meetings of Members shall be held at the Company’s principal place of business or such other place as designated by the Management Committee. Not less than ten (10) nor more than twenty (20) days before each meeting, the Person calling the meeting shall give written notice of the meeting to each Member entitled to vote at the meeting. The notice shall state the time, place and purpose of the meeting.

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(B) Notwithstanding the foregoing provisions, each Member who is entitled to notice waives notice if before or after the meeting the Member signs a waiver of the notice which is filed with the records of Members’ meetings, or is present at the meeting in person or by proxy. The presence in person or by proxy of all of the Members shall be required for the transaction of Business at any meeting of the Members. A Member may vote either in person or by written proxy signed by the Member or by the Member’s duly authorized attorney-in-fact.

(C) All actions requiring consent of the Members shall be effective only upon agreement by both of the Members, which agreement may be formal or informal and by oral or written instructions.

Section 6.12 Liability and Indemnification of the Management Committee, Members and Affiliates .

(A) Limitation of Liability . The Managers and the Members, and their respective officers, partners, members, directors, equity owners, agents, and representatives (each, a “ Member Party ”) shall not be liable, responsible or accountable in damages or otherwise to the Company or any Member for any act or omission performed or made by any of them in good faith on behalf of the Company and in a manner reasonably believed by them to be within the scope of the authority granted by this Agreement or otherwise by Law and in the best interests of the Company if such Member Party (or Person acting on its behalf) shall not have committed a breach of its obligations hereunder, fraud, bad faith, dishonesty, violation of Laws, gross negligence or willful misconduct with respect to such act or omission.

(B) Indemnification . The Company, its receiver or its trustee shall, to the extent of Company assets, indemnify, save harmless, and pay all judgments and claims against the Member Parties, relating to any liability or damage incurred by reason of any act performed or omitted to be performed by the Member Party in connection with the Business, including reasonable attorneys’ fees incurred by the Member Party in connection with the defense of any action based on any such act or omission; provided, however, no party shall be indemnified from any liability for fraud, bad faith, dishonesty, violation of Laws, willful misconduct, gross negligence or breach of the express terms of this Agreement.

(C) Capacity . Sections 6.12(A) and (B) are intended to apply to the Member Parties in their capacities as, or as officers, partners, members, directors, equity owners, agents, and representatives of, the Members or members of the Management Committee, only, and shall not include any acts or omissions under or pursuant to any other agreement between any such Person or an Affiliate thereof and the Company.

ARTICLE 7. LIMITED LIABILITY; RIGHTS AND OBLIGATIONS OF THE MEMBERS

Section 7.1 Limited Liability . Except as otherwise provided by the Act or this Agreement, the debts, obligations and liabilities of the Company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the Company, and no Member, Manager, officer or employee shall be obligated personally for any such debt,

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obligation or liability of the Company solely by reason of being a Member, Manager, officer or employee of the Company.

Section 7.2 Member Limited Liability . Except as otherwise expressly required by Law or by this Agreement, a Member, in its capacity as such, shall not be obligated to make any contribution to the Company in excess of its required Capital Contributions, or have any liability for the repayment and discharge of the Company’s debts and obligations; provided, however that (a) until the Capital Contribution of a Member shall have been paid to the Company, such Member shall be liable to the Company for any portion of its Capital Contribution not so paid, and (b) each Member shall be liable for (i) its obligations to make other payments expressly provided for in this Agreement and (ii) the amount of any distributions wrongfully distributed to it but only to the extent provided in Section 18-607 of the Act.

Section 7.3 Conflicts of Interest .

(A) Neither the Members nor the Managers shall be required to devote full time to their duties hereunder but shall devote reasonable time and effort thereto.

(B) Subject to Sections 7.6 and 7.7 , the other provisions of this Agreement, and the Marketing Agreement, any Member or Affiliate of a Member may engage independently or with others in other business ventures of every nature and description. Neither the Company nor any Member shall have any right by virtue of this Agreement or the relationship created hereby in or to any other ventures or activities in which any Member or Affiliate of a Member is involved or to the income or proceeds derived therefrom, subject to the terms of this Agreement. The pursuit of other ventures and activities by Members or Affiliates of a Member, even if directly competitive with the Business, is hereby consented to by the Members and shall not be deemed wrongful or improper, subject to the terms of this Agreement. No Member or Affiliate of a Member shall be obligated to present any particular business or investment opportunity to the Company even if such opportunity is of a character which, if presented to the Company, could be taken by the Company, and any Member or Affiliate of a Member shall have the right to take for his/her/its own account (individually or as a member or fiduciary), or to recommend to others, any such particular opportunity.

Section 7.4 Transactions With Members and Affiliates . The Company may enter into agreements with one or more Members or Affiliates of a Member to provide leasing, management, legal, accounting, architectural, brokerage, development or other services or to buy, sell or lease assets to or from the Company, provided that any such transactions shall be unanimously approved by all Members and shall be at rates at least as favorable to the Company as those available from unaffiliated parties and terms for providing such services shall be comparable to terms and services generally available in the market. The validity of any transaction, agreement or payment involving the Company and any Member or Affiliate of a Member otherwise permitted hereunder shall not be affected by reason of the relationship between such Person and the Company or any of its Members. Notwithstanding the foregoing, the Members agree that the Management Committee has unanimously approved those agreements set forth on Schedule 2 hereto, together with those certain agreements as may exist by and between Bluegreen or Affiliates of Bluegreen to provide (i) management services to the Big Cedar Owners’ Association at the Big Cedar Timeshare Project, (ii) management services to

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the Bluegreen Wilderness Club at Long Creek Ranch Condominium Association, Inc. at the Red Rock Bluff Timeshare Project, (iii) title services, including title insurance, and (iv) exchange and/or reservation services respecting use of the Timeshare Projects (to be at the expense of the timeshare user or participant) (“ Approved Agreements ”). The non-interested Member shall have the right to enforce any agreement entered into pursuant to this Section 7.4 on behalf of the Company.

Section 7.5 Compensation and Reimbursement of the Members; Management Committee; General Manager .

(A) The Company shall not pay the Members any salary or other compensation for acting as Members hereunder; provided, however that the Company may pay a Member for goods received or services provided by that Member to the Company pursuant to any authorized agreement by and between the Company and any Member, including, but not limited to the Approved Agreements. The General Manager shall receive a salary for serving in such capacity in such amounts and on such terms as may be approved by the Management Committee.

(B) Except as set forth in this Agreement or otherwise provided pursuant to any agreement entered into by and between the Company and a Member (including the Approved Agreements), each Member shall be responsible for paying all expenses necessary to permit such Member to carry out such Member’s duties and obligations hereunder and such expenses shall not be reimbursed by the Company or treated as a contribution to the capital of the Company by such Member. The Company shall reimburse the Managers and the General Manager for all reasonable, documented out of pocket expenses incurred by them in connection with the discharge of their obligations under this Agreement.

Section 7.6 Non-Competition—Bluegreen .

(A) Conduct of Business with Competitor . Notwithstanding any other provision of this Agreement, Bluegreen agrees, on behalf of itself and its Affiliates, that neither Bluegreen nor any of its Affiliates shall contract with or conduct any business with, or have any interest, either directly or indirectly, with Cabela’s, Inc., Sportsman’s Warehouse, Inc., Gander Mountain Company (or any of their successors) or any other Person, whether as shareholder, partner, member, manager, independent contractor, consultant, agent, principal, creditor, or otherwise, that primarily (i.e., over 50% of sales) engages in, or is an Affiliate of, Cabela’s, Inc., Sportsman’s Warehouse, Inc., Gander Mountain Company (or any of their successors) or any other Person that engages in, the sale of fishing, hunting, camping or marine and/or boating products, equipment or services (each, a “ BP/Tracker Competitor ”), provided , however , that this restriction shall not prohibit Bluegreen or any of its Affiliates from contracting with or conducting business with, or having any interest, either directly or indirectly, in any BP/Tracker Competitor (excluding Cabela’s, Inc., Sportsman’s Warehouse, Inc., Gander Mountain Company (or any of their successors)) that sells fishing, hunting, camping or marine and/or boating products, equipment or services as an incidental part of its business. Such sale of fishing, hunting, camping or marine and/or boating products and equipment shall be deemed “incidental” to a BP/Tracker Competitor’s business if such products and equipment do not exceed 50% of

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such BP/Tracker Competitor’s retail sales, such as Sports Authority, Dick’s Sporting Goods, as they are currently constituted, and similar sporting goods companies.

(B) Termination . The restrictions set forth in Section 7.6(A) shall terminate upon the termination of the Marketing Agreement (including any extensions thereof). Further, the restrictions set forth in Section 7.6(A) shall terminate:

(1) with respect to BP/Tracker Competitors who sell outdoor recreational products, equipment or services that directly compete with the outdoor recreational products, equipment and services of Bass Pro, Inc., upon the occurrence of a Bankruptcy Event with respect to Bass Pro, Inc.;

(2) with respect to BP/Tracker Competitors who sell outdoor recreational products, equipment or services that directly compete with the outdoor recreational products, equipment and services of Tracker Marine, L.L.C., upon the occurrence of a Bankruptcy Event with respect to Tracker Marine, L.L.C.; and

(3) with respect to BP/Tracker Competitors who sell outdoor recreational products, equipment or services that directly compete with the outdoor recreational products, equipment and services of Tracker Marine Retail, LLC, upon the occurrence of a Bankruptcy Event with respect to Tracker Marine Retail, LLC.

(1) Bluegreen agrees, on behalf of itself and its Affiliates, that neither Bluegreen nor any of its Affiliates shall participate directly or indirectly in the development, construction, ownership, sales, franchise, license, financing, management or operation of, or enter into any agreement regarding, any timeshare development, Resort Interest Program, Fractional Interest Development or timeshare project that: (A) (i) is similar in design to the Big Cedar Timeshare Project or the Red Rock Bluff Timeshare Project; (ii) is similar in theme to the Big Cedar Timeshare Project or the Red Rock Bluff Timeshare Project; or (iii) contains (or will contain) timeshare estates or interests (or portions thereof), units or other interests that are (or will be) marketed or sold at a price equal to or greater than the least expensive timeshare estates or interests (or portions thereof), units or other interests marketed or sold at the Big Cedar Timeshare Property or the Red Rock Bluff Timeshare Property; and (B) which is located or proposed to be located within the “ Restricted Area .” “Restricted Area” shall mean the area located within fifty (50) miles from any point of the Big Cedar Timeshare Property or the Red Rock Bluff Timeshare Property.

(2) If Bluegreen or any of its Affiliates commits a breach or threatens to commit a breach of any of the provisions of this Section 7.6(C) , BCLLC, on behalf of itself and the Company, shall have the right and remedy, in addition to any others that may be available at law or in equity or under this Agreement, to have the provisions of this Section 7.6(C) specifically enforced by any court having equity jurisdiction, it being acknowledged and agreed that any such breach will cause irreparable injury to BCLLC and the Company and that money damages will not provide an adequate remedy. Such injunction shall be available without the posting of any bond or other security, and Bluegreen, on behalf of itself and its Affiliates

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consents to the issuance of such injunction. The existing activities of Bluegreen and its Affiliates as of the date of this Agreement which are described in Schedule 7.6 attached hereto are approved exceptions to this Section 7.6(C) .

(3) The restrictions set forth in this Section 7.6(C) shall terminate on the termination of this Agreement (as same may be extended).

Section 7.7 Non-Competition—BCLLC .

(A) Promotion of Resort Interest Program . Notwithstanding any other provision of this Agreement, BCLLC agrees, on behalf of itself and its Affiliates, that neither it nor any of its Affiliates shall sell, market, advertise, develop or promote any Resort Interest Program, excepting, however, the Timeshare Projects, the Bluegreen Vacation Club, any Bluegreen Timeshare Facility as offered by Bluegreen, and any Fractional Interest Development (regardless of Bluegreen involvement, but subject to Section 7.9 ). Notwithstanding the foregoing, it is agreed that BCLLC and its Affiliates may continue to operate the projects owned or controlled by BCLLC or its Affiliates at the following locations: Valhalla Island, Florida; Floridian Sports Club; Welaka, Florida; Frying Pan River Ranch, Colorado; Komaham Lodge, British Columbia; the parcel of land known as the “Stonecroft” property, Missouri; or at any property owned now or in the future by American Sportsman Holdings Co. BCLLC shall be permitted to sell, develop, market, advertise or promote any whole ownership real estate development.

(B) Termination . The restrictions set forth in Section 7.7(A) shall terminate on the earlier of (i) the termination of the Marketing Agreement (as same may be extended) or (ii) upon the occurrence of a Bankruptcy Event with respect to Bluegreen or Bluegreen Corporation.

Section 7.8 BCLLC’s Right to Participate .

(A) General . It is acknowledged by the Members that Bluegreen is in the business of developing, marketing and selling Resort Interest Programs, including timeshare projects. It is further acknowledged by the parties that there may arise the occasion where Bluegreen may consider developing a timeshare project based on the same concept as the Big Cedar Timeshare Project or the Red Rock Bluff Timeshare Project at other locations, which timeshare project will contain timeshare estates or interests (or portions thereof), units or other interests that will be marketed or sold at a price equal to or greater than the least expensive timeshare estates or interests (or portions thereof), units or other interests marketed or sold at the Big Cedar Timeshare Property or the Red Rock Bluff Timeshare Property (any such timeshare project, a “ Proposed Project ”). Bluegreen agrees that, subject to the limitations set forth in this Section 7.8 , BCLLC shall have the exclusive, irrevocable and absolute right to “Participate” (as defined below) with Bluegreen in the development of a Proposed Project. A timeshare project shall be deemed to be based on the same concept as the Big Cedar Timeshare Project or the Red Rock Bluff Timeshare Project if it is founded upon an outdoor/wilderness/rustic theme, utilizing lodges and/or cabins, and using similar materials and architectural design. The right to “ Participate ” shall mean the right to co-develop and/or provide marketing and promotional services as such co-development or providing of services may be mutually agreed to by BCLLC

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on the one hand, and Bluegreen on the other.

(B) Limitations; Term . BCLLC’s right to Participate set forth in Section 7.8(A) shall terminate on the earlier of (i) the termination of the Marketing Agreement (as same may be extended) or (ii) the occurrence of a Bankruptcy Event with respect to BCLLC.

(C) Procedures for Exercise . If Bluegreen desires to develop a Proposed Project, then Bluegreen shall first offer in a written notice for BCLLC to Participate in the Proposed Project, specifying the terms and conditions of such Participation (the “ Participation Offer Notice ”). BCLLC shall have sixty (60) days from the date written notice was received to accept the offer to Participate, and if BCLLC does not accept the offer provided in the Participation Offer Notice within such period, BCLLC shall be deemed to have rejected the offer. If BCLLC does not accept such offer, then at the expiration of the sixty (60) day notice period (or such earlier date as the right to Participate has been expressly rejected in writing by BCLLC during such period), Bluegreen may offer the right to Participate to any Person who is not a BP/Tracker Competitor, provided that a binding letter of intent or similar agreement is entered into between Bluegreen and such Person within one hundred eighty (180) days after the expiration of such sixty (60) day notice period and Bluegreen does not elect to proceed with such Proposed Project itself without a co-development partner. If a binding letter of intent or similar agreement is not entered into between Bluegreen and such Person within one hundred eighty (180) days after the expiration of the sixty (60) day notice period and Bluegreen does not elect to proceed with such Proposed Project itself without a co-development partner, such proposed Participation shall again be subject to this Section 7.8 and shall require compliance by Bluegreen with the procedures described in this Section 7.8 . Any information included in the Participation Offer Notice shall be maintained by BCLLC as confidential information which may be disclosed by BCLLC only to inform Bass Pro, Inc. and their respective advisors, legal counsel, consultants and senior executives who have a need to know such information, and otherwise be disclosed only as required by applicable Law. The exercise or non-exercise of the rights of BCLLC under this Section 7.8 with respect to any Proposed Project shall not adversely affect its rights with respect to subsequent Proposed Projects under this Section 7.8 .

Section 7.9 Bluegreen’s Right to Participate .

(A) General . If BCLLC and/or its Affiliates develop a Fractional Interest Development (or develops any Resort Interest Program as otherwise may be permitted under this Agreement), and determines that the same is to be developed through the participation of an additional investor, whether by joint venture, limited liability company, or otherwise, then BCLLC agrees, on behalf of itself and its Affiliates, that, subject to the limitations set forth in this Section 7.9 , Bluegreen shall have the exclusive, irrevocable and absolute right to Participate (as defined above) with BCLLC and/or its Affiliates in such Fractional Interest Development or Resort Interest Program, as applicable.

(B) Procedures for Exercise . Any election by Bluegreen to Participate shall be effective only if BCLLC (or its Affiliate) and Bluegreen execute a letter of understanding documenting their mutual agreement as to co-development and marketing and promotional services as relate to the proposed Fractional Interest Development or Resort Interest Program within sixty (60) days after Bluegreen receives written notice from BCLLC (or its Affiliate) of

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its intent to develop a Fractional Interest Development or Resort Interest Program. Such notice shall include a reasonable description of the Fractional Interest Development or Resort Interest Program. Such information as included in the notice shall be maintained by Bluegreen as confidential information which may be disclosed by Bluegreen only to its advisors, legal counsel, consultants and senior executives who have a need to know such information, and otherwise be disclosed only as required by applicable Law. If Bluegreen elects not to Participate or fails to execute a letter of understanding within sixty (60) days, then BCLLC (or its Affiliate) may proceed with such Fractional Interest Development or Resort Interest Program without Participation or involvement of Bluegreen.

(C) Limitations; Term . Bluegreen’s right to Participate set forth in Section 7.9(A) shall terminate on the earlier of (i) the termination of the Marketing Agreement (as same may be extended) or (ii) the occurrence of a Bankruptcy Event with respect to Bluegreen or BC.

Section 7.10 Specific Rights, Authority and Obligations of the Members .

(A) Marketing . Notwithstanding the other provisions hereof, Bluegreen and BCLLC shall cooperate to develop a mutually acceptable arrangement for the marketing and sales of timeshares in the Timeshare Projects. Specifically, BCLLC shall not assume day-to-day control of the marketing, sales, or operational aspects, or the back-of-house administrative activities of the timeshare business, all of which shall continue to be administered by Bluegreen pursuant to the terms of this Agreement and the Marketing Agreement; provided , however , BCLLC shall have the right to establish the policies, procedures and guidelines applicable to the (i) use of the Bass Pro and Big Cedar brands and (ii) timeshare marketing and sales activities at the Timeshare Projects, and the Bass Pro retail outlets to the extent such activities affect Bass Pro/Big Cedar customers.

(B) Brand Licensing Fees and Marketing Fees . During the term of this Agreement, the Company shall pay to BCLLC, for the promotional, marketing and advertising services contemplated by this Agreement and other Approved Agreements, a “ Brand Licensing Fee ” equal to five percent (5%), and a “ Marketing Fee ” equal to four and one-half percent (4.5%), respectively, of the Net Sales Volume of timeshare sales of the Company at the Red Rock Bluff Timeshare Project and any new units that are constructed on the grounds of the Big Cedar Timeshare Project and sold by or on behalf of the Company, excluding however, the Building 3000 Project; provided , however , the net effect of the Brand Licensing Fee and Marketing Fee shall not collectively result in granting BCLLC an effective share greater than forty-four percent (44%) of the Field Operating Profit of the Company prior to the application of the Brand Licensing Fee and the Marketing Fee.

(C) Transfer of Property / Club Arrangement . Notwithstanding any other provisions contained herein to the contrary, Bluegreen, acting by and through any of its authorized representatives, is expressly authorized to transfer and convey timeshare interests as may exist in the Timeshare Projects to purchasers thereof and accept therefor instruments of indebtedness relating to the sale and transfer of such timeshare interests, and is further authorized to sell or pledge such instruments of indebtedness, including promissory notes, mortgages or deeds of trust received from consumer purchasers of timeshare interests, which sales or pledges

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may be to such third party entities as in the discretion, from time to time, determined by Bluegreen. In furtherance thereof, Bluegreen may transfer, whether by sale, pledge or otherwise, any and all collateral related to the sale of such timeshare interests as such third party may request, including but not limited to consumer transaction documents relating to the sale of timeshare interests which accompany the deed of trust and promissory note related thereto. In addition, Bluegreen, acting by and through any of its authorized representatives, is expressly authorized to arrange and implement the involvement or inclusion of the Timeshare Projects in the Bluegreen Vacation Club, and to provide for registration, marketing and sale of the timeshare interests in the Timeshare Projects as a part of or otherwise affiliated with the Bluegreen Vacation Club.

(D) Shared Expense .

(1) Bluegreen acknowledges that (i) pursuant to certain agreements executed in relation to this Agreement and the Original Operating Agreement, including, without limitation, that certain Easement Agreement dated as of June 15, 2000, by and among BCLLC, Three Johns Company, Bluegreen, the Big Cedar Owners’ Association, and the Company, certain owners of timeshare interests at the Big Cedar Timeshare Project and the Red Rock Bluff Timeshare Project shall have rights to be present on the premises of, and to use certain facilities of, the Big Cedar Lodge (the “ Timeshare Owner Use ”); (ii) such Timeshare Owner Use has directly contributed to the success of the Big Cedar Timeshare Project, and that the Timeshare Owner Use will continue to contribute to the success of the Timeshare Projects; and (iii) BCLLC has incurred and may incur future expenses and liabilities from time to time arising from accidents, injuries or other losses suffered by owners of timeshare interests at the Timeshare Projects as a result of the Timeshare Owner Use. In recognition of the foregoing, the Members agree that, in addition to any cost-sharing or indemnification that the Big Cedar Owners’ Association may provide to BCLLC, the Company shall, on an annual basis, pay to and reimburse BCLLC for 100% of all expenses or liabilities incurred by BCLLC as a result of the Timeshare Owner Use (net of any amounts covered by insurance or paid by the Big Cedar Owners’ Association).

(2) BCLLC shall maintain insurance at least equal to the insurance it presently maintains. BCLLC shall submit to the Company an itemized list of expenses owing to BCLLC pursuant to Section 7.10(D)(1) no later than thirty (30) days prior to the end of each Fiscal Year. The Company shall inform BCLLC of any objections to BCLLC’s itemized list within twenty (20) days of receipt, and shall pay, to the extent not paid by the Big Cedar Owners’ Association, directly to BCLLC all amounts to which there is no objection prior to the end of each Fiscal Year. The parties shall cooperate to come to an agreement as to any amounts subject to a Company objection as expeditiously as possible.

Section 7.11 Records of the Company . The Company will provide the Members complete access to and right to audit books and records of the Company, at the sole expense of the Member accessing such books and records and/or conducting such audit. Bluegreen shall provide BCLLC with a monthly report and certification of all timeshare sales of the Timeshare Projects with names of the purchasers, the same being due within twenty (20) days of the first of each calendar month.

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ARTICLE 8. TRANSFERS OF INTERESTS

Section 8.1 Restrictions .

(A) Except as provided in this Section 8.1 and each sub-part hereof, no Member may, without the prior consent of all of the Members, which consent may be withheld in such Member’s sole discretion, effect a Transfer of all or any part of his or her Membership Interest, provided, however, either Party may Transfer its Membership Interest: (i) to an Affiliate of such Member (after providing reasonable evidence to the Company or the other Member that the prospective Transferee is in fact an Affiliate to the extent the Company or the other Member requests such evidence) of the other Member; and (ii) to the Company in accordance with any agreement with the Company unanimously approved by the Management Committee. “ Transfer ” means any voluntary or involuntary transfer, sale, assignment, exchange, encumbrance, charging order or hypothecation or other disposition.

(B) Voluntary Transfers in violation of the provisions hereof shall be void and of no effect for any purpose. Members who have effected Transfers of all of their Membership Interests shall have no further right, authority, and/or responsibility to participate in the management of the business and affairs of the Company.

(C) Each party hereto acknowledges the reasonableness of the restrictions on Transfer imposed by this Agreement in view of the Company purposes and the relationship of the Members. Accordingly, the restrictions on Transfer contained herein shall be specifically enforceable. Each party hereto hereby further agrees to hold the Company and each Member wholly and completely harmless from any cost, liability, or damage (including reasonable attorneys’ fees, liabilities for income taxes, and the cost of enforcing this indemnity) incurred by any of such indemnified Persons as a result of a Transfer or an attempted Transfer by such party in violation of this Agreement.

Section 8.2 Effect of Assignment; Documents .

(A) Any Membership Interest transferred pursuant to the provisions of this Article 8 shall be subject to the restrictions and obligations set forth in this Agreement and no Transfer of any Membership Interest otherwise permitted hereunder (except for a pledge or collateral assignment to another Person) shall be effective for any purpose unless and until the party to whom such Membership Interest is being transferred has executed this Agreement (as amended) and agreed to be bound by all of its terms and provisions. Unless otherwise expressly agreed by the Members or expressly provided herein, no Transfer permitted hereunder shall relieve the assignor from any of its obligations under this Agreement accruing prior to such Transfer.

(B) In the event ownership of any Membership Interest is transferred to any other Person other than in accordance with the provisions set forth in this Article 8 , such transferee shall succeed to such Membership Interest as an assignee only under the Act and, except for a successor permitted pursuant to Section 8.1 , shall have no right to become a substitute Member or to participate in the management of the business and affairs of the Company and shall not be considered a “Member” under this Agreement or be a “member” as

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that term is used in the Act with respect to such Membership Interest; provided , however , such transferee shall (1) be liable for the obligations of his or her assignor under this Agreement attributable to such Membership Interest; (2) be subject to the continuing obligations attributable to such Membership Interest under this Agreement; and (3) be entitled to receive the distributions attributable to such Membership Interest under Articles 3 and 9 and allocations of Profits and Losses and other items under Article 4 .

ARTICLE 9. DISSOLUTION OF THE COMPANY

Section 9.1 Liquidation Events .

(A) No act, thing, occurrence, event, or circumstance shall cause or result in the dissolution of the Company except that the earliest to occur of any of the following events (a “ Liquidation Event ”) shall work an immediate dissolution of the Company:

(1) December 31, 2057;

(2) The sale or other disposition of all or substantially all of the Business Property;

(3) A decision to do so approved by all Members; or

(4) Subject to Section 9.2 below, any event (each a “ Dissociation Event ”) described in Section 18-801 of the Act occurring with respect to a Member; provided , however , the Members hereby agree that, upon the occurrence of (a) a permitted Transfer in accordance with the provisions of Article 8 ; or (b) a voluntary withdrawal of a Member in violation of the terms of this Agreement, the business and affairs of the Company shall be automatically continued by the Company and such event shall not constitute a Dissociation Event for purposes of this Agreement.

(B) Notwithstanding any provision of the Act, each Member hereby covenants and agrees that the Members have entered into this Agreement based on their mutual expectation that all Members will continue as Members and carry out the duties and obligations undertaken by them hereunder and that, except as otherwise expressly required or permitted hereby, each Member covenants and agrees not to (1) take any action to dissolve the Company; (2) take any action that would cause a bankruptcy of such Member; (3) voluntarily withdraw or attempt to withdraw from the Company; (4) exercise any power under the Act to dissolve the Company; or (5) petition for judicial dissolution of the Company, without the unanimous consent of the Members not then in default hereunder.

Section 9.2 Right to Continue Business and Affairs of Company .

(A) Upon the occurrence of a Dissociation Event with respect to a Member (the “ Dissociating Member ”), the Dissociating Member shall give notice thereof to the other Members and such remaining Member(s) may, within the ninety (90) day period following such occurrence, elect, by agreement of Members collectively holding more than fifty percent (50%) of the Percentage Interests then held by non-Dissociating Members, to continue the business and affairs of the Company for the balance of the term hereof (it being understood that if such an

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agreement is not executed within such ninety (90) day period, the Dissociation Event shall constitute a Liquidation Event). In the event any Member acquires knowledge of a Dissociation Event, that Member shall promptly give notice thereof, specifying the nature of the Dissociation Event and the identity of the Dissociating Member, to the Company and all of the other Members (including the Dissociating Member) and such notice shall be deemed to be notice from the Dissociating Member for purposes of this Section 9.2(A) .

(B) If the remaining Member(s) so elect to continue the business and affairs of the Company:

(1) The Company shall not dissolve and its business and affairs shall be carried on without interruption, and without the necessity of the execution of any confirmatory agreement, under the same name and under the same terms and provisions as are set forth in this Agreement (as the same may be amended by the remaining Members); and

(2) The Management Committee shall take such steps and make such filings as may be required to reflect such Dissociation Event and the continuation of the business and affairs of the Company.

Section 9.3 Distribution of Proceeds on Dissolution; Winding Up; Reserves .

(A) Upon the occurrence of a Liquidation Event, the Company shall continue solely for the purposes of winding up its affairs in an orderly manner, liquidating its assets, and satisfying the claims of its creditors and Members and neither the Management Committee nor any General Manager or Member shall take any action that is inconsistent with, or not necessary to or appropriate for, winding up the Company’s business and affairs. To the extent not inconsistent with the foregoing, all covenants and obligations in this Agreement shall continue in full force and effect until such time as Dissolution Proceeds have been distributed pursuant to this Section 9.3 and the Company has filed a certificate of cancellation.

(B) The General Manager or, if there is no General Manager, a Member appointed by the Members (in either case, the “ Winding-Up Member ”) shall be responsible for overseeing the winding up and liquidation of the Company. As soon as reasonably practical after the occurrence of a Liquidation Event, the Winding-Up Member shall file a notice of winding up and take such other actions as are required under the Act to dispose or make provision for the known and unknown claims against the Company. After filing the notice of winding up, the Winding-Up Member shall take full account of the Company’s liabilities and the Business Property, cause the Business Property to be liquidated as promptly as is consistent with obtaining the fair value thereof, and shall cause the proceeds therefrom and any other assets and funds of the Company (collectively, the “ Dissolution Proceeds ”) to the extent sufficient therefor, to be applied and distributed in the following order:

(1) First, to the payment of all unpaid secured indebtedness of the Company to the extent of the lesser of the value of the secured property or the amount of the secured indebtedness;

(2) Second, to the payment of the Company’s remaining indebtedness, including any Member Loan; and

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(3) Third, the balance, if any, less such reserves (“ Dissolution Reserves ”) as the Winding-Up Member reasonably determines are necessary or appropriate for anticipated or contingent expenses of the Company, shall be distributed to the Members in accordance with Section 3.1 .

(C) To the extent the Winding-Up Member subsequently determines Dissolution Reserves (or any part thereof) to be unnecessary for Company expenses, he or she shall cause such amounts to be distributed or paid to the Members or other Persons who would have received the proceeds comprising such Dissolution Reserves under this Section 9.3 as if such proceeds had not been used to fund Dissolution Reserves.

(D) When all of the remaining property and assets of the Company have been applied and distributed as provided in this Section 9.3 , the Winding-Up Member shall file a certificate of cancellation as provided in the Act and take such other actions as may be necessary to cause the Company to withdraw from all jurisdictions where the Company is then authorized to transact business.

Section 9.4 Allocations Upon Dissolution . Profits and Losses from an event causing dissolution pursuant to Section 9.1 shall be allocated among the Members so that after such allocations and the other allocations under this Agreement, to the maximum extent possible the final Capital Account balances of the Members are at levels which would permit liquidating distributions, if made in accordance with such final Capital Account balances, to be equal to the distributions that will occur under Section 9.3(B)(3) . To the extent that the allocation provisions of this Agreement would not produce such target Capital Account balances, the Members agree to take such actions as are reasonably necessary to amend such allocation provisions to produce such balances so long as such amendments are permissible under the applicable tax Law.

ARTICLE 10. GENERAL

Section 10.1 Notices/Approvals to Be In Writing . Any notice, request, approval, consent, demand or other communication required or permitted hereunder shall be given by hand delivery or sent and paid Federal Express or other overnight delivery, at the following addresses or such other addresses as such party hereto shall advise the others:


	If to Bluegreen:	4960 Conference Way North, Suite 100 Boca Raton, Florida 33431 Attention: David Pontius, President

	With a copy to:	Bluegreen Corporation 4960 Conference Way North, Suite 100 Boca Raton, Florida 33431 Attention: General Counsel

	With a copy to:	James J. Scavo, Esq. Weinstock and Scavo, P.C. 3405 Piedmont Rd., N.E. Suite 300 Atlanta, Georgia 30305 Email: jscavo@wslaw.net

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	With a copy to:	Barry E. Somerstein, Esq. Ruden McClosky 200 East Broward Blvd PO Box 1900 Ft. Lauderdale, Florida 33301 Email: barry.somerstein@ruden.com

(Delivery to legal counsel, however, shall not be deemed notice to Bluegreen).


	If to BCLLC:	2500 East Kearney Street Springfield, Missouri 65898 Attention: Toni Miller Attention: General Counsel

	With a copy to:	Latham & Watkins LLP Sears Tower, Suite 5800 233 South Wacker Drive Chicago, IL 60606 Attention: Michael A. Pucker Email: michael.pucker@lw.com

(Delivery to legal counsel, however, shall not be deemed notice to BCLLC).

All notices shall be deemed given at the time of hand delivery or the time such is deposited with Federal Express or other reputable overnight delivery service for transmittal as aforesaid; provided , however , the time at which response or action in response to any notice must be given or taken shall run form the time of actual receipt of such notice.

Section 10.2 Entire Agreement . This Agreement and the other agreements contemplated hereby, including the Approved Agreements, among the Company and any of the Members, constitute the entire agreement among the parties with respect to the subject matter hereof and supersede all prior agreements, (including the Original Operating Agreement) understandings and negotiations, both written and oral, between the parties with respect to the subject matter hereof or thereof. No representation, inducement, promise, understanding, condition or warranty not set forth in this Agreement or the Approved Agreements has been made or relied upon by any party to this Agreement. This Agreement is not intended to confer upon any Person other than the Members and the Company any rights or remedies hereunder.

Section 10.3 Amendments . This Agreement may be amended only by agreement executed by all the Members.

Section 10.4 Miscellaneous . Time is of the essence with respect to this Agreement. Except as herein otherwise specifically provided, this Agreement shall be binding upon and inure to the benefit of the parties and their legal representatives, successors and assigns, and no other Person shall acquire or have any right under or by virtue of this Agreement. Captions contained in this Agreement in no way define or limit the scope or intent of this Agreement. If any provision of this Agreement, or the application of any such provision to any Person or

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circumstance shall be held to be illegal, invalid or unenforceable under present or future Laws effective during the term hereof, the remainder of this Agreement, or the application of such provision to any other Persons or circumstances, shall not be affected thereby and shall be construed and enforced as if such illegal, invalid, or unenforceable provision had never comprised a part hereof. In lieu of such illegal, invalid, or unenforceable provision, there shall be added automatically as a part hereof a provision as similar in terms to such illegal, invalid or unenforceable provision, as may be possible and be legal, valid and enforceable. Every exhibit, schedule and other appendix attached to this Agreement and referred to herein is incorporated in this Agreement by reference. All capitalized terms are defined herein and are used as so defined. This Agreement may be executed in several counterparts and all so executed shall constitute one Agreement, binding on all the parties hereto, notwithstanding that all the parties are not signatories to the original or same counterpart. Should a provision of this Agreement require judicial interpretation, it is agreed that the judicial body interpreting or construing the same shall not apply the assumption that the terms hereof shall be more strictly construed against one party by reason of the rule of construction that an instrument is to be more strictly construed against the party which itself, or through its agent, prepared the same, it being agreed that the agents of all parties have participated or had the opportunity to participate in the preparation of this Agreement.

Section 10.5 GOVERNING LAW . THIS AGREEMENT SHALL BE GOVERNED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE WITHOUT REFERENCE TO ITS INTERNAL CONFLICTS OF LAWS PRINCIPALS.

Section 10.6 Submission to Jurisdiction . Each of the parties hereto irrevocably (A) agree that any legal suit, action or proceeding arising out of or based upon this Agreement shall be instituted only in the Federal District Court for the Western District of Missouri, (B) waive, to the fullest extent it may effectively do so, any objection which it may now or hereafter have to venue of any such proceeding and (C) submit to the exclusive jurisdiction of such courts in any such suit, action or proceeding.

Section 10.7 Remedies .

(A) If the Company or any party obtains a judgment against any other party by reason of breach of this Agreement, a reasonable attorneys’ fee as fixed by the court shall be included in such judgment. Any Member shall be entitled to maintain, on its own behalf or on behalf of the Company, any action or proceeding against any other Member or the Company (including, any action for damages, specific performance, or declaratory relief) for or by reason of breach by such party of this Agreement, notwithstanding the fact that any or all of the parties to such proceeding may then be Members in the Company, and without dissolving the Company as a limited liability company; provided , however , the liability of any Member or the Company for or by reason of breach by such party of this Agreement shall be limited as set forth herein.

(B) The remedies conferred upon the Company or any Member in this Agreement are intended to be exclusive of any other remedy herein or by Law provided or permitted. No failure or delay on the part of a Member or the Company to exercise any right it may have in the event of an act or omission giving rise to a claim hereunder in accordance with

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the terms of this Agreement by a Member shall prevent the exercise of such right by such Member or the Company at any time such Member defaulting as provided for in this Agreement, may continue to be so in default, and no such failure or delay shall operate as a waiver of any default. Notwithstanding the limitations of liability as provided for in this Agreement, each party to this Agreement agrees that the Members would be irreparably damaged if any of the provisions of this Agreement are not performed in accordance with their specific terms and that monetary damages would not provide an adequate remedy in such event. Accordingly, it is agreed that, in addition to the remedies to which the non-breaching Members may be entitled in accordance with the terms hereof the non-breaching Members shall be entitled to injunctive relief to prevent breaches of the provisions of this Agreement and specifically to enforce the terms and provisions hereof in any action instituted in any court of the United States or any state thereof having subject matter jurisdiction thereof.

(C) No waiver by a Member or the Company of any breach of this Agreement shall be deemed to be a waiver of any other breach of any kind or nature and no acceptance of payment or performance by a Member or the Company after any such breach shall be deemed to be a waiver of any breach of this Agreement whether or not such Member or the company knows of such breach at the time it accepts such payment or performance.

(D) In the event of any dispute or disagreement between the Members, such party shall give written notification of such dispute or disagreement to, if such party is BCLLC or any their Affiliates, John M. Maloney, Jr., or the person then performing the duties at Bluegreen currently performed by John M. Maloney, Jr., (“ Bluegreen CEO ”) and if such party is Bluegreen, acting as Bluegreen, Bluegreen Affiliates or the Company, to James A. Hagale or the person then performing the duties at BCLLC currently performed by James A. Hagale (together with the Bluegreen CEO, the “ CEOs ”); and (iii) the CEOs shall communicate with each other promptly with a view to resolving such dispute or disagreement within ninety (90) days of commencing any negotiations (or such extended period as the CEOs agree is appropriate in any such case). The foregoing shall be a condition precedent to applicability of the remedies set forth in this Section 10.7 . During any period of such communications, all services prior to any claimed default shall continue without any alteration or modification, except as acceptable to the party receiving such services.

Section 10.8 Representations and Warranties . Each Member warrants, represents, agrees and acknowledges: (1) that it has adequate means of providing for its current needs and foreseeable future contingencies, and anticipates no need now or in the foreseeable future to sell its Membership Interest; (2) that it acquired its Membership Interest for its own account as a long-term investment and without a present view to make any distribution, resale or fractionalization thereof; (3) that it and its independent counselors have such knowledge and experience in financial and business matters that they are capable of evaluating the merits and risks of the investment involved in its acquisition of its Membership Interest and they have evaluated the same; (4) that it is able to bear the economic risks of such investment; (5) that it and its independent counselors have made such investigation of the Company (including its business prospects and financial condition) and the Members have had access to all information regarding the Company and the Members, and have had an opportunity to ask all of the questions regarding the Company and the Members as they deem necessary to fully evaluate its investment therein; (6) that in connection with its acquisition of its Membership Interest, it has been fully

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informed by its independent counsel as to the applicability of the requirements of the Securities Act of 1933 and all applicable state securities or “blue-sky” laws to its Membership Interest; (7) that it understands that (a) its Membership Interest is not registered under the Securities Act or any state securities law; (b) there is no market for its Membership Interest and that it will be unable to transfer its Membership Interest unless such is so registered or unless the transfer complies with an exemption from such registration (evidence of which must be satisfactory to counsel for the Company); (c) such Membership Interest cannot be expected to be readily transferred or liquidated; (d) its acquisition of a Membership Interest in the Company involves a high degree of risk; and (e) that no representations are or have been made to it by the Management Committee, any Member, or their respective representatives as to any tax advantages which may inure to its benefit or as to the Company’s status for tax purposes, and that it has relied upon its independent counsel with respect to such matters.

Section 10.9 Financial Reporting . In addition to the requirements set forth in Section 5.1(A) , the Management Committee shall periodically, and at no time less than quarterly, establish financial reporting in respect to the Company, which financial reporting shall be delivered to BCLLC and Bluegreen, and which financial reporting shall be a compilation of sales of timeshare interests, income arising therefrom, and expenses of the Company, inclusive of marketing, sales and operating expenses. Such financial reporting shall include an income statement, balance sheet or other information as may be reasonably required.

Section 10.10 Confidentiality; Public Announcements .

(A) Each Member covenants and agrees (i) to receive and hold in strict confidence all Proprietary Information received by such Member, its Affiliates and/or representatives and to use such Proprietary Information only in connection with the businesses of the Company and such Member’s investment therein, and (ii) to cause its representatives and Affiliates, including any members of the Management Committee, to comply with the preceding clause (i).

(B) Section 10.10(A) hereof shall not apply to any Proprietary Information which a Member can establish to have: (i) been disclosed by such Member with the Company’s prior written consent; (ii) become generally available to the public other than as a result of disclosure by such Member in breach of this Section 10.10 or any other obligations of confidentiality that a Member may have to the Company; (iii) been independently developed by such Member outside the scope of agreements with the Company through Persons (including any representatives of such Member) who have not had actual knowledge of such Proprietary Information; (iv) been rightfully obtained by such Member from a third party without knowledge that such third party is obligated to protect its confidentiality; provided that such Member has used all reasonable efforts to determine whether such third party has any such obligation; (v) been obligated to be produced or disclosed pursuant to applicable law, provided that such Member seeks appropriate protective relief from all or part of such disclosure; or (vi) been used in connection with litigation between the parties.

(C) Any publicity release, advertisement, filing, public statement or announcement made, regarding this Agreement or any of the transactions contemplated hereby, or BCLLC or any of its Affiliates is to be first reviewed by, and must be reasonably satisfactory

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to, BCLLC and Bluegreen. The parties agree that, notwithstanding the foregoing, Bluegreen Corporation may make public disclosure as required by law, including press releases and SEC filings, related to its interest in the Company of the following information: (i) the Company’s publicly disclosed development plans, (ii) previously publicly disclosed results and comparative information, including revenues on quarterly and annual basis, and (iii) financial results on quarterly and annual basis.

(D) Notwithstanding the foregoing, BC or Bluegreen may use information regarding the performance of the Company’s receivables portfolio in connection with disclosing its performance as a servicer of receivables in related matters.

[Remainder of Page Intentionally Left Blank]

IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the Effective Date.


BLUEGREEN VACATIONS UNLIMITED, INC.
a Florida corporation

By:

Please Print Name:

Its:


BIG CEDAR, L.L.C.,
a Missouri limited liability company

By: Bass Pro Group, LLC, a Delaware limited
liability company, its Sole Member

	By:

		Toni M. Miller
		Vice President, Chief Financial Officer &
		Treasurer

Solely with respect to Section 2.6 ,

BLUEGREEN CORPORATION,
a Massachusetts corporation

	By:

	Please Print Name:

	Its:

Schedule 1

Expenses of Bluegreen


RED ROCK / MPI PROPERTY


Invoices paid by Bluegreen Corp with respect to MPI Property Purchase

Date	Payee	Amt	Description


6/29/2007	Virginia Polinski	596.87	Kinco’s Plat Copies

7/23/2007	Ruden McClosky	15,580.20	Long Creek Campground Lease Assumption (Boat Slips

11/9/2007	Neale & Newman	1,095.50	Opinion Ltr, Zoning, S&M, Land Use

11/16/2007	Weinstock & Scavo	5,330.00	Assoc. Articles of Incorp/Bylaws, Plats Declaration
11/30/2007	The Conference Group	34.55	Teleconference Call
10/31/2007	JP Morgan Chase Bank	17,806.50	Legal fee with closing of loan
10/19/2007	JP Morgan Chase Bank	38,032.54	Loan Interest Payment

	Amts Pd by Bluegreen	78,476.16

Schedule 2

Approved Agreements

1. Amended and Restated Marketing & Promotions Agreement dated as of December 31, 2007, by and among BCLLC, Bluegreen, the Company, and the other parties thereto.

2. Amended and Restated Operational Services and Integration Agreement, dated as of December 31, 2007, by and among BCLLC, Bluegreen, and Big Cedar Resort Club Owners Association, Inc.

3. Amended and Restated Servicing Agreement, dated as of December 31, 2007, by and among Bluegreen Corporation, the Company and BCLLC.

4. Amended and Restated Administrative Services Agreement, dated as of December 31, 2007, by and among Bluegreen, the Company and BCLLC.

5. Easement Agreement by and among BCLLC, the Company, and the Big Cedar Resort Club Owners Association, Inc., dated as of June 15, 2000.

6. Easement Agreement by and among BCLLC, the Company and the Big Cedar Resort Club Owners Association, Inc., to be executed by the parties within 30 days of the date hereof.

7. Construction Management Agreement, by and among Bass Pro, Inc. and the Company, to be executed by the parties within 30 days of the date hereof.

Schedule 7.6

Excepted Bluegreen Activities

Sale of timeshare interests at Falls Village Resort, located in Branson, Missouri and Horizons by Marriott Vacation Club at Branson, located in Branson, Missouri.

EXHIBIT A

MEMBERS

Member Name and
Address

November 30, 2007 Capital Account

Member
Loans ¹

Percentage Interest

Bluegreen Vacations
Unlimited, Inc.

$22,543,723 (Book)

$78,476.16

4960 Conference Way
North
Suite 100
Boca Raton, Florida 33431

$26,487,838 (Tax)

Big Cedar, L.L.C.

$21,786,316 (Book)

2500 East Kearney Street

Springfield, MO 65898

$25,575,759 (Tax)

¹ In accordance with Section 2.2 of this Agreement, Member Loans do not include normal course receivables and payables.

A-1

EXHIBIT B

BIG CEDAR TIMESHARE PROPERTY

B-1

EXHIBIT C

RED ROCK BLUFF PROPERTY

C-1

EXHIBIT D

RED ROCK BLUFF BUSINESS PLAN

D-1

EXHIBIT E

MASTER USE AND DEVELOPMENT PLAN – RED ROCK BLUFF

E-1

EXHIBIT F

BUSINESS PLAN

F-1

EXHIBIT G

ANNUAL BUDGET

G-1

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AMENDED AND RESTATED
MARKETING AND PROMOTIONS AGREEMENT

December 31, 2007

TABLE OF CONTENTS


ARTICLE I - DEFINITIONS			2

	Section 1.1	Definitions	2

ARTICLE II - MARKETING AND PROMOTION OF BLUEGREEN’S TIMESHARE FACILITIES AND THE TIMESHARE PROJECTS			7

	Section 2.1	General	7
	Section 2.2	Term	7
	Section 2.3	Bass Pro Catalog	8
	Section 2.4	Bass Pro Shops	9
	Section 2.5	Website Links	14
	Section 2.6	Mailing Lists	17
	Section 2.7	Big Cedar Lodge	21
	Section 2.8	Signage	22
	Section 2.9	Tradenames and Marks	23
	Section 2.10	Preferential Treatment	28
	Section 2.11	Proprietary Information	28
	Section 2.12	Other Promotional Agreements and Channels	28
	Section 2.13	Lead Generation Programs	29

ARTICLE III - RESTRICTIONS			30

	Section 3.1	Restriction on BP/BC Marketing Channels	30
	Section 3.2	Restriction on Bluegreen Marketing Channels	30

ARTICLE IV - GENERATION COMMISSION			31

	Section 4.1	Generation Commission	31
	Section 4.2	Annual Prepayments	32

ARTICLE V - PERMITTED USE; CONTENT; APPROVAL RIGHTS			33

	Section 5.1	Permitted Use	33
	Section 5.2	Content and Approval Rights	34

ARTICLE VI - INDEMNIFICATION / LIMITATION OF LIABILITY			35

	Section 6.1	Indemnification—Bluegreen	35
	Section 6.2	Indemnification –The Company	35
	Section 6.3	Indemnification – Service Provider	35
	Section 6.4	Limitation of Liability	35


ARTICLE VII - MISCELLANEOUS			36

	Section 7.1	GOVERNING LAW	36
	Section 7.2	Submission to Jurisdiction	36
	Section 7.3	Remedies	36
	Section 7.4	Notice/Default	37
	Section 7.5	Notices	37
	Section 7.6	Assignment	39
	Section 7.7	Confidentiality	39
	Section 7.8	Good Faith Cooperation, Negotiation, Operation and Performance	39
	Section 7.9	Severability	39
	Section 7.10	Counterparts	40
	Section 7.11	Entire Agreement	40
	Section 7.12	Construction	40
	Section 7.13	No Condition Precedent	40
	Section 7.14	Time is of the Essence	40
	Section 7.15	Consideration	40

List of Exhibits


Exhibit A-1	Bass Pro Trademarks, Trade Names, Service Marks, Proprietary Marks, Logos and Unique Signs
Exhibit A-2	Big Cedar Trademarks, Trade Names, Service Marks, Proprietary Marks, Logos and Unique Signs
Exhibit B-1	Big Cedar Timeshare Project Property Description
Exhibit B-2	Red Rock Bluff Property Description
Exhibit C	Prospect Track (to be revised within 30 days)

AMENDED AND RESTATED
MARKETING AND PROMOTIONS AGREEMENT

THIS AMENDED AND RESTATED MARKETING AND PROMOTIONS AGREEMENT (this “ Agreement ”) is made and entered into as of this 31st day of December, 2007 by and among Big Cedar, L.L.C., a Missouri limited liability company (“ Big Cedar ”), Bass Pro, Inc., a Delaware corporation (“ Bass Pro ”), Bass Pro Outdoor World, L.L.C., a Missouri limited liability company (“ BPOW ”), Bass Pro Outdoors Online, L.L.C., a Missouri limited liability company (“ BP Online ”), BPS Catalog, L.P., a Missouri limited partnership (“ BPS Catalog ”), Bass Pro Trademarks, L.L.C., a Missouri limited liability company (“ BP Trademarks ”), World Wide Sportsman, Inc., a South Carolina corporation (“ WW Sportsman ”), Bass Pro Shops Canada, Inc., an Ontario corporation (“ BPS Canada ”), Bass Pro Shops Canada (Calgary), Inc., a Canada corporation (“ BPS Canada Calgary ”), BPIP, LLC, a Virginia limited liability company, (“ BPIP ”), Tracker Marine, L.L.C., a Missouri limited liability company (“ Tracker Marine ”), Bluegreen Vacations Unlimited, Inc., a Florida corporation (“ Bluegreen ”), and Bluegreen/Big Cedar Vacations, LLC, a Delaware limited liability company (the “ Company ”). Each of Big Cedar, Bass Pro, BPOW, BP Online, BPS Catalog, BP Trademarks, WW Sportsman, BPS Canada, BPS Canada Calgary and BPIP are sometimes referred to herein as a “ Service Provider ,” and they are sometimes collectively referred to herein as the “ Service Providers .” Each of Bluegreen and the Company are sometimes referred to herein as an “ Advertiser ,” and they are sometimes collectively referred to herein as the “ Advertisers .”

WITNESSETH

WHEREAS , Big Cedar, Bass Pro, Bluegreen, and the Company previously entered into that certain Marketing and Promotions Agreement dated as of June 16, 2000 (the “ Original M&P Agreement ”), which provided for an arrangement by which Big Cedar, Bass Pro and certain Affiliates of Bass Pro provided to Bluegreen and certain Affiliates of Bluegreen, promotional, marketing and advertising services;

WHEREAS , Big Cedar and Bluegreen are members of the Company, and the Company has acquired certain real property adjacent to the Big Cedar Timeshare Project (as defined herein) for purposes of the construction and development of the Building 3000 Project (as defined herein), and has acquired the Red Rock Bluff Property (as defined herein) for purposes of the construction and development of the Red Rock Bluff Timeshare Project (as defined herein); and

WHEREAS , in connection with the acquisition of the Red Rock Bluff Property and the construction and development of the Building 3000 Project and the Red Rock Bluff Timeshare Project, Big Cedar, Bass Pro, Bluegreen, the Company and the other parties hereto now desire to amend and restate the Original M&P Agreement in its entirety on the terms and conditions set forth herein.

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

ARTICLE I - DEFINITIONS

Section 1.1 Definitions .

(a) As used herein, the following terms have the following meanings:

(i) Affiliate as to any Person means (1) any other Person directly or indirectly through one or more intermediaries controlling, controlled by or under common control with such Person, or (2) a trust which has as its principal income beneficiaries or remaindermen such Person and/or a member or members of such Person’s Immediate Family. The terms “controlling,” “controlled” and “common control with” mean the ability, by ownership of voting securities or otherwise, directly or indirectly, to direct the managerial and operating policies of a Person. Except as used in Section 2.11 , Affiliates of the Service Providers shall only include Bass Pro and any controlled subsidiary of Bass Pro. Affiliates of Bluegreen shall only include Bluegreen Corporation and any controlled subsidiary of Bluegreen Corporation.

(ii) Approved Alternative Marketing Programs shall mean, certain additional marketing programs which from time to time may be determined by the Company to be in the best interests of the Company. Such programs may include, but not be limited to, sponsorship of NASCAR events and/or Drivers.

(iii) Bankruptcy Event means, with respect to any Person, (i) the commencement by such Person of a voluntary case under, or the consent by such Person to the entry of an order for relief in an involuntary case under, any bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other similar law now or hereafter in effect, or (ii) the consent by such Person to the appointment of, or taking possession by, a receiver, custodian, liquidator, assignee, trustee or sequestrator (or other similar official) of such Person or of any substantial part of its assets, or (iii) the making of a general assignment by such Person generally to pay its debts as they benefit creditors, or (iv) the admission in writing of such Person of its inability to pay its debts as they become due in the ordinary course of business, or (v) the adoption of a resolution by its directors or shareholders (or analogous managers or equity owners) in furtherance of any of the foregoing, or (vi) the entry by a court of competent jurisdiction of a decree or order for relief in respect of such Person in an involuntary case under any bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other similar Law now or hereafter in effect and the continuance of such decree or order unstayed and in effect for a period of sixty (60) days, or (vii) the appointment of a receiver, examiner, custodian, liquidator, assignee, trustee or sequestrator (or other similar official) of such Person or of any substantial part of its assets, or (viii) the ordering of the winding up or liquidation of its affairs, or conversion of a pending reorganization proceeding into a proceeding under Chapter 7 of the Bankruptcy Code or other proceeding to liquidate or otherwise dispose of a substantial part of such Person’s properties.

(iv) Bass Pro Catalog means those certain retail catalogs published seasonally by BPS Catalog.

(v) Bass Pro Mailing List means the lists of the names and mailing addresses of the customers and clients of Bass Pro and its subsidiaries as are customarily kept by BP Trademarks; provided , however , the Bass Pro Mailing List shall only include such information to the extent it is available and permitted to be shared with others pursuant to applicable law. The Bass Pro Mailing List shall include such customers and clients as now exist or hereafter may exist subject to such limitations as may otherwise be set forth herein.

(vi) Bass Pro Marks means those certain trademarks, trade names, service marks, proprietary marks, logos and unique signs or marks owned by BP Trademarks and identified on Exhibit A-1 hereto.

(vii) Bass Pro Shops means those certain retail stores operated by Bass Pro, BPOW, WW Sportsman, BPS Canada, BPS Canada (Calgary) or Affiliates of Bass Pro, known as “Bass Pro Shops,” “Bass Pro Outdoor World,” Bass Pro Sportsman’s Warehouse,” and “Bass Pro Shops White River Outpost,” and they are each individually referred to herein as a Bass Pro Shop .

(viii) Bass Pro Website means that certain internet website owned and operated by BP Online, and located at the top level domain name basspro.com.

(ix) Big Cedar Lodge means that certain resort facility known as the Big Cedar Lodge located in Ridgedale, Taney County, Missouri, which as of the date hereof is owned and operated by Big Cedar.

(x) Big Cedar Mailing List means the lists of the names and mailing addresses of the customers and clients of Big Cedar, including occupants of the Big Cedar Lodge, as are customarily kept by Big Cedar; provided , however , the Big Cedar Mailing List shall only include such information to the extent it is available and permitted to be shared with others pursuant to applicable law. The Big Cedar Mailing List shall include such customers and clients as now exist or hereafter may exist subject to such limitations as may otherwise be set forth herein.

(xi) Big Cedar Marks means those certain trademarks, trade names, service marks, proprietary marks, logos and unique signs or marks owned by Big Cedar and identified on Exhibit A-2 hereto.

(xii) Big Cedar Timeshare Project means that certain timeshare project developed or to be developed by the Company, inclusive of the Building 3000 Project, located contiguous to the Big Cedar Lodge in Taney County, Missouri, which timeshare project is located or is to be located on that certain property described on Exhibit B-1 hereto.

(xiii) Big Cedar Timeshare Website means that certain internet website owned and operated by the Company, designed to advertise, market and promote the Timeshare Projects, and located at the top-level domain name wildernessclubatbigcedar.com.

(xiv) Bluegreen Mailing List means the lists of the names and mailing addresses of the customers and clients of Bluegreen and its Affiliates, including (without limitation) owners of timeshare interests in Bluegreen’s Timeshare Facilities, as are customarily kept by Bluegreen and its Affiliates; provided , however , the Bluegreen Mailing List shall only include such information to the extent it is available and permitted to be shared with others pursuant to applicable law. The Bluegreen Mailing List shall include such customers and clients as now exist or hereafter may exist subject to such limitations as may otherwise be set forth herein.

(xv) Bluegreen Website means that certain internet website owned and operated by Bluegreen, and located at the top-level domain name bluegreenvacations.com.

(xvi) Bluegreen Timeshare Website means that certain internet website Bluegreen has created and developed, which has been designed to advertise, market and promote Bluegreen’s Timeshare Facilities, located at the top-level domain name bluegreenonline.com.

(xvii) Bluegreen Vacation Club means that certain vacation club operated by Bluegreen, which was initially filed pursuant to Florida Statutes Chapter 721 (The Florida Vacation Plan and Timesharing Act), and is identified in accordance with such registration as the Bluegreen Vacation Club.

(xviii) Bluegreen’s Timeshare Facilities means the Resort Interest Programs, including but not limited to the Bluegreen Vacation Club, designed, developed, marketed and/or sold by Bluegreen or its Affiliates, excluding the Timeshare Projects, whether such facilities now exist or may from time to time exist in the future.

(xix) BP/Tracker Competitor means any Person that engages in, whether as shareholder, partner, member, manager, independent contractor, consultant, agent, principal, creditor, or otherwise, or is an Affiliate of a Person that engages in, the sale of hunting, fishing, camping, marine and/or boating products, equipment or services that directly compete with the products, equipment and services sold by Bass Pro, Tracker Marine or Tracker Marine Retail, LLC, or their respective subsidiaries, provided , however , that a BP/Tracker Competitor shall not include any Person that sells hunting, fishing, camping, marine and/or boating products, equipment or services as an incidental part of its business. Sales shall be deemed “incidental” to a Person’s business if sales of hunting, fishing, camping, marine and/or boating products, equipment or services amount to less than 50% of such Person’s revenues. Examples of BP/Tracker Competitors include, but are not limited to, Cabela’s, Gander Mountain and Sportsman’s Warehouse. For purposes of clarity, Sports Authority, Dick’s Sporting Goods, as they are currently constituted, and similar sporting goods companies, would not be deemed to be a BP/Tracker Competitor.

(xx) Building 3000 Project means that certain portion of the Big Cedar Timeshare Project currently referred to as “Building 3000” to be developed by the Company in accordance with the terms of the Operating Agreement, which is further described on Exhibit B-1 hereto.

(xxi) Competing Resort shall mean any seller, marketer, developer, exchange company, club or lead generator, together with any officer, director, employee, member, shareholder, partner, trustee or relative within the third degree of kindred of any of the foregoing, or any other person or entity which is controlled by any of the foregoing, or any partner, member, shareholder, trustee or beneficiary of any of the foregoing, as respects any timeshare resort or resort interest development, together with any party or entity that may be in competition with Bluegreen or any Bluegreen Affiliate, excepting, however, Bluegreen and any Bluegreen Affiliate. For purposes of this Agreement, the Timeshare Projects and any Fractional Interest Development shall not be deemed Resort Interest Programs “in direct competition with Bluegreen or its Affiliates.”

(xxii) Fractional Interest Development means a Resort Interest Program in which the interests that are conveyed to purchasers are in increments of time that are greater than or equal to six weeks per year.

(xxiii) Immediate Family means, with respect to any Person, the parents, siblings, spouse and lineal descendants, spouses of such lineal descendants and any trust for the benefit of, or the legal representative of, any of the preceding persons, or any partnership substantially all of the partners of which are one or more of such persons or the Person or any limited liability company substantially all of the members of which are one or more of such persons or the Person.

(xxiv) Mailing Lists means the Bass Pro Mailing List, the Big Cedar Mailing List and the Bluegreen Mailing List, collectively.

(xxv) Marks means Big Cedar Marks and Bass Pro Marks.

(xxvi) Net Sales Volume means the dollar amount of gross annual sales of timeshare interests less the aggregate dollar amount of purchaser cancellations, rescissions, equity trade allowances, and defaults.

(xxvii) Operating Agreement means that certain Amended and Restated Operating Agreement of Company, dated as of the date hereof, by and between Bluegreen and Big Cedar.

(xxviii) Person means an individual, partnership, corporation, limited liability company, trust, governmental entity or other association or entity.

(xxix) Preferential Treatment means preferred and preferential pricing on a “most favored nation” basis with respect to any and all fees, costs, price reductions, rebates, allowances, expenses or charges as might be offered to any other Person, not an Affiliate of any of the Service Providers or Tracker Marine or its Affiliates or Tracker Marine Retail, LLC or its Affiliates, and at all times at least as favorable to the best pricing offered to any other Person, not an Affiliate of any of the Service Providers, Tracker Marine or its Affiliates or Tracker Marine Retail, LLC or its Affiliates.

(xxx) Red Rock Bluff Property means that certain property, more particularly described in Exhibit B-2 hereto, purchased by the Company for the development of the Red Rock Bluff Timeshare Project.

(xxxi) Red Rock Bluff Timeshare Project means that certain timeshare project to be developed on the Red Rock Bluff Property by the Company in accordance with the terms of the Operating Agreement.

(xxxii) Resort Interest Program means any form of timeshare, interval interest, timeshare exchange, undivided interest program, timeshare club membership, points-based program, or occupancy program, whereby the use, occupancy or possession of real property or real property improvements has been made subject to a conveyance, use or occupancy or possession right, which circulates among purchasers according to a first come, first serve reservation system, or a floating or fixed time schedule on a periodic, re-occurring basis, over any period of time in excess of one (1) year in duration.

(xxxiii) Timeshare Projects means collectively the Big Cedar Timeshare Project and the Red Rock Bluff Timeshare Project, together with such other Resort Interest Programs as may be owned, developed and sold by the Company from time to time.

(xxxiv) Tracker Website means that certain internet website owned and operated by Tracker Marine, and located at the top level domain name trackerboats.com.

(b) Each of the following terms shall have the meaning assigned to such term in the Section indicated:


Term	Section

Advertisers	Preamble
Advertising Space	2.3(a)
Agreement	Preamble
Annual Prepayment	4.2(a)
BG Mailing List Licensee	2.6(c)
Big Cedar Mailing List License	2.6(b)
Big Cedar Marks License	2.9(b)
Bluegreen CEO	7.3(d)
Bluegreen Hyperlink License	2.5(b)(i)
Bluegreen Mailing List License	2.6(c)
BP Hyperlink License	2.5(a)(i)
BP/BC Marketing Channels	2.1
BP Icon	2.5(b)(ii)
BP Marks License	2.9(a)
BP Mailing List License	2.6(a)
CEOs	7.3(d)


Term	Section

Commission Report	4.1(b)
Concierge Desk	2.7(c)
Floor Space License	2.4(a)
Generation Commission	4.1(a)
Intellectual Property	2.11
Licensed Space	2.4(a)
Mailing List Intermediary	2.6(a)(i)
Original M&P Agreement	Recitals
Post-Termination Generation Commissions	4.2(f)
Resort Icon	2.5(a)(ii)
Service Provider(s)	Preamble
Shop Licensor	2.4(a)
Shortfall	4.2(g)
Submission Date	2.3(b)
Tracker Icon	2.5(b)(ii)
Utility Service	2.4(j)

ARTICLE II - MARKETING AND PROMOTION OF BLUEGREEN’S
TIMESHARE FACILITIES AND THE TIMESHARE PROJECTS

Section 2.1 General . During the term of this Agreement, the Service Providers shall provide the promotional, marketing and advertising services described in this Article II , including, without limitation, the Advertising Space, the Floor Space License, the Big Cedar Mailing List License, the BP Mailing List License, the Big Cedar Hyperlink License, the BP Hyperlink License, the Big Cedar Marks License, the BP Marks License, use of Big Cedar Lodge as described in Section 2.7 , and placement of signage as described in Section 2.8 (collectively referred to herein as the “ BP/BC Marketing Channels ”), to Bluegreen for the benefit of Bluegreen’s Timeshare Facilities, and to the Company for the benefit of the Timeshare Projects. The BP/BC Marketing Channels shall be provided in the amount and quantities and at such times as specified in this Agreement, subject to the restrictions, limitations and conditions set forth in this Agreement.

Section 2.2 Term . The initial term of this Agreement shall expire on January 1, 2015. This Agreement shall automatically renew for additional one (1) year periods on January 1 each subsequent year unless one party delivers written notice of intent to terminate this Agreement to the other parties on or before September 1 of the preceding year. Notwithstanding the foregoing, if Big Cedar has not received the Annual Prepayment (defined below) for the year 2015 or any succeeding year on or before January 1 of each such renewal year (or within ten (10) days thereafter), any Service Provider may elect to terminate this Agreement for all purposes and with respect to all parties at any time upon written notice to the Advertisers.

Section 2.3 Bass Pro Catalog .

(a) Advertising . During the term of this Agreement, BPS Catalog agrees to make advertising, marketing and promotion copy space within each Bass Pro Catalog (the “ Advertising Space ”) routinely and consistently available to the Advertisers as would be commercially reasonable. The Advertising Space shall be used by the Advertisers solely for advertising, marketing and promotion relating to or connected with the Timeshare Projects and Bluegreen’s Timeshare Facilities; provided , however , that the Advertising Space shall be used to give priority to promotion of the Timeshare Projects, and the Timeshare Projects’ inclusion in the Bluegreen Vacation Club over promotion of Bluegreen’s Timeshare Facilities. The size and placement of the Advertising Space shall be as determined by BPS Catalog, but will be sufficient to establish prominent marketing support for the Timeshare Projects and Bluegreen’s Timeshare Facilities, and at least one full page per Bass Pro Catalog shall be available to the Advertisers. While the Advertising Space shall be made available by BPS Catalog, nothing herein contained shall require the Advertisers to use the Advertising Space on each and every occasion.

(b) Terms of Advertising . BPS Catalog agrees to notify Bluegreen at least ninety (90) days before the date necessary for submission of an advertisement for publication (“ Submission Date ”) in each of the Bass Pro Catalogs. Bluegreen agrees to submit a copy of its advertising copy, together with all layouts, cuts, mats and electrotypes, intended for publication, at least thirty (30) days in advance of the Submission Date. If BPS Catalog notifies Bluegreen ninety (90) days before the Submission Date and Bluegreen fails to submit a copy of its advertising for publication to BPS Catalog at least thirty (30) days in advance of the Submission Date, then BPS Catalog will not be obligated to insert the advertisement in the applicable Bass Pro Catalog, unless otherwise agreed by the BPS Catalog and Bluegreen. Bluegreen acknowledges that BPS Catalog requires significant lead times to plan and paginate Bass Pro Catalogs. Therefore, once Bluegreen submits a copy of its advertising for publication, Bluegreen shall be responsible for all costs associated with publication of such advertisement as described in Section 2.3(c) , without refund. Within five (5) days after the publication of each Bass Pro Catalog in which Bluegreen or the Company has placed an advertisement, BPS Catalog shall furnish Bluegreen with three (3) copies of such Bass Pro Catalog. All positions are at the option of BPS Catalog. Under no circumstances can any claim for adjustment, refund or re-insertion be allowed because of the position in which an advertisement has been published or inserted. It is the sole responsibility of the Advertisers to check the correctness of each insertion of an advertisement. Advertisements submitted after the deadline for proof service are submitted at the Advertiser’s own risk, and Service Providers shall have no liability for errors or omissions in such Advertisements. Service Providers assume no responsibility for the repetition of errors in advertising ordered for more than one insertion, unless notified before the printing closing time on the same day an error occurs.

(c) Consideration; Expenses . The Advertising Space shall be made available to the Advertisers at no further cost or expense to the Advertisers, and BPS Catalog agrees that the Advertising Space has been paid for in full so long as the Advertisers comply with their obligations set forth in this Agreement, including, without limitation, the timely payment by Bluegreen of Generation Commissions; provided , however , that the Advertisers agree to pay BPS Catalog publication costs in relation to the Advertisers’ use of the Advertising Space, which shall include direct cost of postage, printing, paper, creative color separation, bind-ins, and

service bureau charges and a fair and reasonable allocation of administrative overhead, at cost, and without markup, on a Preferential Treatment Basis, which payments shall be due within thirty (30) days after receipt of proof of insertion and publication in the Bass Pro Catalog and the invoice for publication costs.

(d) Restrictions . During the term of this Agreement, except as otherwise provided herein, the Service Providers shall not allow, accept, publish, print, include or authorize any advertising, marketing or promotional material in any of the Bass Pro Catalogs, or other respective catalogs or publications published by the Service Providers, which reference, promote or relate to any Competing Resort; provided , however , that the Service Providers may accept advertisements or promotions in their respective catalogs, which advertisements or promotions may include therein the name of an enterprise and its respective property, so long as such advertisements or promotions do not promote, advertise or market Resort Interest Programs relating to such enterprise or prospects respecting the foregoing, nor does such advertisement or promotion constitute a Resort Interest Program advertisement, nor do the properties included in such advertisements constitute a Resort Interest Program. Nothing herein contained shall limit the right of the Service Providers to sell their retail products in stores, via the internet, and through catalogs to other purchasers, even though such purchasers may be in competition with the Company or Bluegreen (such entities including, but not limited to, Opryland, Disney World, John Q. Hammons Industries and other similar enterprises). The Service Providers may advertise such companies and other resorts in Bass Pro Shops, on the Bass Pro Website and within the Bass Pro Catalogs, so long as the Service Providers do not promote or market Resort Interest Programs of such companies, nor do the resorts advertised include or contain any Resort Interest Programs nor efforts to market Resort Interest Programs.

Section 2.4 Bass Pro Shops .

(a) Grant of License . During the term of this Agreement, Bass Pro (on behalf of itself and any Affiliate of Bass Pro that may operate a Bass Pro Shop in the future), BPOW, WW Sportsman, BPS Canada and BPS Canada Calgary (each, a “ Shop Licensor ,” and collectively, the “ Shop Licensors ”) hereby grant, bargain and exchange unto the Advertisers, during the term of this Agreement, a limited, non-exclusive license (the “ Floor Space License ”) to use floor space, including kiosk space, in each Bass Pro Shop (the “ Licensed Space ”)for marketing and promotion of the Timeshare Projects and Bluegreen’s Timeshare Facilities, on the terms and conditions set forth herein. The Advertisers hereby accept the Floor Space License. The Floor Space License shall apply to existing and future Bass Pro Shops. The Floor Space License is granted by Bass Pro for those Bass Pro Shops that are operated by Bass Pro or that will be operated by Bass Pro or an Affiliate of Bass Pro in the future; the Floor Space License is granted by each other Shop Licensor for those Bass Pro Shops that are operated by such Shop Licensor.

(b) Floor Space .

(i) The total amount of Licensed Space available in each existing Bass Pro Shop in which floor space was licensed to the Advertisers pursuant to the Original M&P Agreement shall be equal to the amount of floor space currently used by the Advertisers. The total amount of Licensed Space available in all other Bass Pro Shops shall be as mutually agreed

by the Advertisers and the applicable Shop Licensor, provided that the amount of Licensed Space available in each Bass Pro Shop shall be no less than one hundred (100) square feet and no greater than one thousand (1000) square feet, used singularly or in multiple separate areas in and throughout each Bass Pro Shop. The configuration of the Licensed Spaces shall be determined by the Advertisers and the Shop Licensors as may mutually be agreed from time to time.

(ii) All Licensed Spaces shall be located to effectively promote, market and advertise the Timeshare Projects and Bluegreen’s Timeshare Facilities. Licensed Spaces may be used for establishment of kiosks, interactive computers, a stepped marketing track or program through which prospective consumers may proceed, or such alternative similar uses as may be determined by the Advertisers. The location of the kiosks, computers, marketing tracks or similar uses, shall not interfere with the customary and normal retail operations of the applicable Bass Pro Shop. Any modifications regarding the location of the floor space and the foregoing particulars (i.e., kiosks, interactive computers, marketing track, etc.) inconsistent with the schematic plan referenced above shall only occur upon approval of the applicable Shop Licensor, whose approval shall not be unreasonably withheld or denied. Except as otherwise provided in this Section 2.4 , including, without limitation, Section 2.4(f) , all potential sales prospects who are originated from contact at any of such Licensed Spaces shall not be limited to marketing or sales for any particular or specific Bluegreen Timeshare Facility or the Timeshare Projects.

(c) Additional Space . In addition to the Licensed Space specified in Section 2.4(b)(i) , the Shop Licensors agree that additional Licensed Spaces in each Bass Pro Shop may be made available to the Advertisers on terms to be negotiated on a store-by-store basis, upon request by the Advertisers to the applicable Shop Licensor for such additional Licensed Spaces; provided , such additional space shall not interfere with the customary normal operations of any Bass Pro Shop and shall only be available upon establishment that the existing Licensed Space is effectively inducing prospects in respect to timeshare sales. Any additional Licensed Space provided pursuant to this Section 2.4(c) shall be made available in the applicable Store Licensor’s sole discretion.

(d) Purpose of Floor Space License . The Floor Space License is limited to the operation of an area from which the Advertisers may market, promote and otherwise solicit interest in respect to acquisition of timeshare interests in the Timeshare Projects or Bluegreen’s Timeshare Facilities, as limited by Section 2.4(f) .

(e) Exclusivity / Non-Exclusivity . Except as otherwise specifically provided herein, the Floor Space License shall be non-exclusive to the Advertisers, and the Shop Licensors reserve the right to use the Bass Pro Shops in respect of any product or service. Nothing in this Agreement shall prevent any Shop Licensor from granting any other licenses for the use of the floor space in Bass Pro Shops or from permitting others to use floor space within Bass Pro Shops in any manner whatsoever, provided , however , that, during the term of this Agreement, no floor space in any Bass Pro Shop shall be provided, made available or offered to any Competing Resort or any operator or marketer thereof for the purpose of marketing, promoting or soliciting timeshare interests or prospects therefor.

(f) Radius Restriction. Notwithstanding anything herein to the contrary, beginning at such time as there are timeshare units available for sale at the Big Cedar Timeshare Project (including Building 3000) or the Red Rock Bluff Timeshare Project, and continuing until such time as 90% or more of the timeshare interests in the Big Cedar Timeshare Project (including the Building 3000 Project) and 90% or more of the timeshare interests in the Red Rock Bluff Timeshare Project have been sold, the Bass Pro Shops located in Springfield, Missouri and Branson, Missouri shall not be used to promote or market any Bluegreen Timeshare Facility located within 50 miles of the Timeshare Projects, including, without limitation, the Falls Village Resort located in Branson, Missouri.

(g) Use of Licensed Space . The Floor Space License shall authorize the Advertisers to operate during the regular business hours of each Bass Pro Shop. The Advertisers’ method of conducting business shall at all times be in keeping with and not inconsistent with or detrimental to the operation of each Bass Pro Shop by the Shop Licensors.

(h) Personnel. All personnel staffing the Licensed Space will be employed by Bluegreen. The business to be conducted by the Advertisers under the Floor Space License shall at all times be adequately staffed with competent personnel. In no event shall the operators or employees of the Advertisers engage in “high pressure salesmanship” in the solicitation or marketing to customers. Activities of the Advertisers and their personnel conducted pursuant to the Floor Space License shall be in a manner not offensive to the customers of the Shop Licensors, and in compliance with all applicable requirements of law. Advertisers and their personnel shall not use endorsements or testimonials of any Service Provider, any Affiliate of a Service Provider or any Person controlling a Service Provider, and shall not represent to potential customers that any Service Provider, any Affiliate of a Service Provider or any Person controlling a Service Provider recommends the Timeshare Projects or Bluegreen’s Timeshare Facilities. The Advertisers shall each indemnify and defend the Service Providers from any losses, damages, lawsuits or other claims resulting from the violation by personnel of an Advertiser of the requirements set forth in this Section 2.4(h) or violations of law by personnel of the Advertisers within a Bass Pro Shop pursuant to the Floor Space License.

(i) Shop Licensors Rights to Approve Personnel . Notwithstanding anything to the contrary in this Agreement, the Shop Licensors shall have the right to approve decisions by the Advertisers relating to personnel working in any Bass Pro Shop pursuant to the Floor Space License, including the right, upon written notice to the applicable Advertiser, to direct removal of any individual employee, consultant or other agent of the Advertisers from any Bass Pro Shop for good cause shown, including, but not limited to, Shop Licensors believing that the individual employee’s actions are detrimental to the respective Bass Pro Shop.

(j) Utilities and Services . The Shop Licensors agree that each Bass Pro Shop will be made available to the Advertisers in a condition that will provide air conditioning, lighting, heating, water and toilet facilities and electrical service (“ Utility Service ”). The Shop Licensors shall, during the term of this Agreement, promptly pay all costs and expenses accruing or payable in connection with such Utility Service, except in the event such costs or expenses relate to improvements made by the Advertisers with respect to the Licensed Spaces. The Advertisers shall be responsible for expenses of telephone services and computer services to the areas in which the Advertisers exercise their business under the Floor Space License.

(k) Telephone Lines . The Shop Licensors acknowledge that telephone services are available to each Bass Pro Shop. The Advertisers shall bear the expense of extending the telephone service as necessary or convenient for the Advertisers’ business, pursuant to the terms of the Floor Space License, including acquisition costs of telephones and computers and installation of telephones or additional facilities or improvements, including computers.

(l) Alterations and Additions . Neither Advertiser shall make any alterations, decorations, modifications or improvements in furtherance of its business under the Floor Space License unless such Advertiser has submitted the plans and specifications showing the design, type, style, color and materials to the applicable Shop Licensor, and the applicable Shop Licensor has given prior written approval. The Shop Licensors will exercise reasonable discretion in determining these requirements. Any alterations, decorations, additions, installations or improvements made by the Advertisers shall, at the discretion of the Shop Licensors become the property of the Shop Licensors upon termination of the Floor Space License, provided that the foregoing shall not apply to personal property such as telephones, computers, etc. Any equipment or personal property of the Advertisers within a Bass Pro Shop shall not become or at any time be considered a fixture of a Bass Pro Shop, regardless of the means by which it may be attached to the premises. If the applicable Shop Licensor directs the Advertisers to remove any and all such alterations, decorations, additions, installations or improvements made at a Bass Pro Shop, the Advertisers shall so remove the alterations, decorations, additions, installations or improvements at their respective sole cost and expense and make all repairs necessary to restore the premises to the original condition at the time of commencement of the Floor Space License.

(m) Insurance / Risk of Loss . At all times during the term of the Floor Space License, the Advertisers shall, at their sole cost and expense, keep all of the Advertisers’ inventory of product, merchandise and contents and all of Advertisers’ improvements, furniture, equipment and fixtures within the licensed space insured against loss or damage by fire and the hazards covered by broad-form extended coverage clauses as well as coverage against loss of the merchandise within the Licensed Space due to theft or embezzlement in an amount at least equal to the replacement value thereof. At all times during the term of the Floor Space License, the Advertisers shall provide, at Advertisers’ cost and expense, policies of commercial general liability insurance insuring the Shop Licensors and Advertisers against claims for injury and wrongful death occurring within the Licensed Space. Advertisers shall indemnify and hold Shop Licensors harmless from and against all liabilities, obligations, losses, damages and claims, actions, suits and proceedings, charges and expenses, including reasonable attorneys’ fees, which may be imposed upon or incurred by or asserted against Shop Licensors in respect of any use or condition of the Licensed Space or attributed to Advertisers’ use thereof. The Advertisers shall provide the Shop Licensors with certificates of insurance on an annual basis verifying the insurance required hereunder and all such policies shall name the applicable Shop Licensor as an additional insured thereunder and shall waive all rights of subrogation against the Shop Licensor.

(n) Destruction of Premises . In the event that a Bass Pro Shop is damaged or destroyed during the term of this Agreement to the extent that it cannot be put into tenantable condition by the applicable Shop Licensor within one hundred eighty (180) days after damage or destruction, the Advertisers shall have the right to suspend operations under the Floor Space

License for that specific Bass Pro Shop. The Shop Licensors shall not be responsible for replacement, repairing or restoring any merchandise, fixtures or equipment installed by the Advertisers or that are otherwise the property of the Advertisers which may be damaged or destroyed in such event.

(o) Maintenance . The Shop Licensors shall be responsible for and furnish normal janitorial services for each Bass Pro Shop, including the Licensed Space, on a regular basis, as often as necessary to keep the premises in a neat, clean and presentable condition consistent with the remainder of the Bass Pro Shop in which the Floor Space License is exercised by the Advertisers.

(p) Eminent Domain . If during the term of this Agreement the whole or any part of any Bass Pro Shop is acquired or condemned by eminent domain, then the Floor Space License shall terminate and cease as to such Bass Pro Shop on the date of the title vesting in such proceeding, and the Advertisers shall not have any claim against the applicable Shop Licensor or the owner of the property (if other than the applicable Shop Licensor), nor the condemning authority for the value of the Floor Space License; provided that if the condemnation is partial, then the foregoing shall apply only if the Bass Pro Shop is unsuitable for the business of the Advertisers. In the event of the partial taking or condemnation that is not extensive enough to render the Bass Pro Shop unsuitable for business (which decision shall be determined by the Shop Licensors) then the Floor Space License shall continue in full force and effect.

(q) Interest of the Advertisers . The interests, rights and responsibilities of the Advertisers under the Floor Space License are solely as nonexclusive licensees. The Shop Licensors and their respective designees shall have the unconditional right and privilege to enter the Licensed Spaces at any time, and the Shop Licensors retain possession, ownership or leasehold interest (as applicable), control, occupancy and use of the Licensed Spaces. The Floor Space License is in all respects subordinate to any lease or sublease applicable to any of the Bass Pro Shops. No real property is leased or subleased to the Advertisers by the Floor Space License, and the Floor Space License shall not create any estate, right, title or interest in real property or vest the Advertisers with any other property rights to or in the Licensed Space. The Advertisers shall have no rights as a tenants or subtenants of the Licensed Space. The rights conferred by the Floor Space License are personal to the Advertisers and shall not be construed to run with the land.

(r) Consideration; Expenses . The Floor Space License is granted to the Advertisers at no further cost or expense to the Advertisers, and the Shop Licensors agree that the Floor Space License has been paid for in full so long as the Advertisers comply with their obligations set forth in this Agreement, including, without limitation, the timely payment by Bluegreen of Generation Commissions; provided , however , that the Company agrees to pay the actual expenses incurred by the Advertisers as provided in this Section 2.4 in relation to the Bass Pro Shop located in Springfield, MO, including for telephones (and telephone usage) and/or additional facilities or improvements, including computers, installed in or operating from the Licensed Spaces, and staff personnel, and provided further , that the Advertisers agree to pay the actual expenses incurred by the Advertisers as provided in this Section 2.4 in relation to all other Bass Pro Shops, including for telephones (and telephone usage) and/or additional facilities or

improvements, including computers, installed in or operating from the Licensed Spaces, and staff personnel.

Section 2.5 Website Links .

(a) Bass Pro Website .

(i) Grant of License . During the term of this Agreement, BP Online hereby grants to each of the Advertisers, a worldwide, royalty free, non-exclusive license to establish hyperlinks from the Bass Pro Website as further provided in this Section 2.5(a) (the “ BP Hyperlink License ”), which shall be on the terms and subject to the conditions set forth in this Agreement.

(ii) Links from Bass Pro Website . Pursuant to the BP Hyperlink License, during the Term of this Agreement, BP Online shall maintain an icon on the Bass Pro Website identified as “Resorts” (or such other icon as is mutually acceptable to Bluegreen, the Company, Bass Pro and BP Online) (hereinafter “ Resort Icon ”). Upon clicking the Resort Icon by an internet user:

(A) an additional icon shall exist to provide direct access to the Big Cedar Timeshare Website. In addition, if the Bass Pro Website contains a search box feature, internet user(s) shall by use of the search box feature be given an option to choose the icon for the Big Cedar Timeshare Website. Upon accessing the icon for the Big Cedar Timeshare Website, internet user(s) shall be directly linked to the Big Cedar Timeshare Website.

(B) an additional icon shall exist to provide direct access to the Bluegreen Timeshare Website. In addition, if the Bass Pro Website contains a search box feature, internet user(s) shall by use of the search box feature be given an option to choose the icon for the Bluegreen Timeshare Website. Upon accessing the icon for the Bluegreen Timeshare Website, internet user(s) shall be directly linked to the Bluegreen Timeshare Website.

(C) an additional icon shall exist to provide direct access to the Bluegreen Website. In addition, if the Bass Pro Website contains a search box feature, internet user(s) shall by use of the search box feature be given an option to choose the icon for the Bluegreen Website. Upon accessing the icon for the Bluegreen Website, internet user(s) shall be directly linked to the Bluegreen Website.

(iii) The BP Hyperlink License shall also permit Bluegreen to establish on the Bluegreen Website an icon and link to the Bass Pro Website and to internet information concerning the Timeshare Projects, inclusive of use of the Bass Pro Marks and Big Cedar Marks, subject to the approval of BP Trademarks or Big Cedar as provided in Section 2.9(c) , to reflect such connection.

(iv) Exclusivity / Non-Exclusivity . Except as otherwise specifically provided herein, the BP Hyperlink License shall be non-exclusive to the Advertisers and BP Online reserves the right to use the Bass Pro Website in respect of any product or service. Nothing in this Agreement shall prevent BP Online from granting any other licenses for the use of the Bass Pro Website or from utilizing the Bass Pro Website or permitting the Bass Pro

Website to be utilized by others in any manner whatsoever; provided , however , BP Online agrees that it shall not grant any other licenses for use of the Bass Pro Website for the purpose of developing, marketing, promoting or advertising any Competing Resort, except as may otherwise be expressly provided for in this Agreement or otherwise agreed by the Advertisers.

(v) Consideration; Expenses . The BP Hyperlink License is granted to the Advertisers at no further cost or expense to the Advertisers, and BP Online agrees that the BP Hyperlink License has been paid for in full so long as the Advertisers comply with their obligations set forth in this Agreement, including, without limitation, the timely payment by Bluegreen of Generation Commissions; provided , however , that Bluegreen shall pay the actual expenses reasonably incurred by BP Online in the establishment of such hyperlinks and reasonable incremental costs associated with future changes in the internet platform.

(b) Bluegreen Website .

(i) During the term of this Agreement, Bluegreen hereby grants to BP Online and Tracker Marine, a worldwide, royalty free, non-exclusive license to establish hyperlinks from the Bluegreen Website as further provided in this Section 2.5(b) (the “ Bluegreen Hyperlink License ”) which shall be on the terms and subject to the conditions set forth in this Agreement.

(ii) Links from Bluegreen Website . Pursuant to the Bluegreen Hyperlink License, Bluegreen shall maintain on the Bluegreen Website an icon to identify the Bass Pro Website (“ BP Icon ”) and an icon to identify the Tracker Website (the “ Tracker Icon ”) as are mutually acceptable to BP Online, Tracker Marine and Bluegreen. Upon clicking on the BP Icon or the Tracker Icon, internet user(s) will be provided direct access to the Bass Pro Website or the Tracker Website, respectively. In addition, if the Bluegreen Website contains a search box feature, internet user(s) shall be given an option to link to the Bass Pro Website or the Tracker Website through a separate BP Icon or Tracker Icon if they search BASS PRO, TRACKER or any similar term through such feature.

(iii) Consideration; Expenses . The Bluegreen Hyperlink License is granted to BP Online and Tracker Marine at no further cost or expense to BP Online or Tracker Marine, and Bluegreen agrees that the Bluegreen Hyperlink License has been paid for in full so long as the Service Providers comply with their obligations set forth in this Agreement; provided , however , that BP Online and Tracker Marine shall pay the actual expenses reasonably incurred by Bluegreen in the establishment of such hyperlinks and reasonable incremental costs associated with future changes in the internet platform.

(iv) Discontinuation . Tracker Marine and BP Online may request that the BP Icon and/or the Tracker Icon, and all links to the Bass Pro Website and the Tracker Website be removed from the Bluegreen Website at any time. Upon receipt of a written request for such removal, Bluegreen shall promptly, but in any event not more than three business days after receipt, comply with such request; provided , however , that Tracker Marine and BP Online shall pay the actual expenses reasonably incurred by Bluegreen in the removal of the BP Icon and Tracker Icon and removal of the related hyperlinks.

(c) Insurance . Bluegreen, the Company and BP Online shall have obtained within one hundred twenty (120)days after the date hereof, and shall maintain at all subsequent times during the term of this Agreement, at their sole cost and expense, cyber liability insurance coverage, which shall include, without limitation, privacy liability coverage (including for non-electronic security breaches) and regulatory liability coverage (including for breaches of state and federal privacy statutes and regulations such as the Fair and Accurate Credit Transaction Act of 2003), in such amounts and with such specific coverages as shall be commercially reasonable, provided that such insurance can be obtained on commercially reasonable terms at a cost not to exceed $100,000 per year, and to the extent that such costs would exceed $100,000 per year then such insurance shall either be scaled back so that it can be obtained within such price parameters or shall not be required to be obtained..

(d) Affirmation Obligations . BP Online and the Advertisers agree at all times during the term of this Agreement: (i) the quality of their respective websites shall not be less than the quality that exists as of the date hereof; (ii) they shall each maintain a technologically capable web site utilizing state-of-the-art or legally required internet security protocol and encryption technology to secure electronic commerce transactions and to prevent unauthorized interception of transmitted data, along with appropriate notices to internet users and consumers; (iii) they shall not permit links to pornographic, lewd, immoral or sexually suggestive websites from their respective websites; and (iv) BP Online shall not permit any links from the Bass Pro Website to websites maintained by or on behalf of any Competing Resort, and Bluegreen shall not permit any links from the Bluegreen Website or the Bluegreen Timeshare Website to websites maintained by or on behalf of any BP/Tracker Competitor.

(e) Representations and Warranties .

(i) BP Online .

(A) BP Online hereby represents and warrants to the Advertisers as of the date hereof and through the term of this Agreement that: (i) BP Online has the power and authority to enter into and perform its obligations under this Agreement; (ii) BP Online owns or has permission to use the Bass Pro Website and all intellectual property rights therein; (iii) to its knowledge, the Bass Pro Website does not contain any content, materials, data, work, trade or service mark, trade name, links, advertising or services that actually or potentially violate any applicable law or regulations or infringe or misappropriate any proprietary, intellectual property, contract or tort right of any Person; and (iv) BP Online has secured the appropriate rights, under applicable state and federal law to grant the BP Hyperlink License.

(B) BP Online shall indemnify and hold harmless the Advertisers from any and all damages, losses, claims, causes of action, or injury arising out of a breach of the representations and warranties set forth in Section 2.5(e)(i)(A) or of the covenants set forth in Section 2.5(d).

(ii) Bluegreen .

(A) Bluegreen hereby represents and warrants to the Service Providers as of the date hereof and through the term of this Agreement that: (i) Bluegreen has

the power and authority to enter into and perform its obligations under this Agreement; (ii) Bluegreen owns the Bluegreen Website and the Bluegreen Timeshare Website and all intellectual property rights therein; (iii) the Bluegreen Website and the Bluegreen Timeshare Website do not contain any content, materials, data, work, trade or service mark, trade name, links, advertising or services that actually or potentially violate any applicable law or regulations or infringe or misappropriate any proprietary, intellectual property, contract or tort right of any person; and (iv) Bluegreen has secured the appropriate rights, under applicable state and federal law to grant the Bluegreen Hyperlink License.

(B) Bluegreen shall indemnify and hold harmless the Service Providers from any and all damages, losses, claims, causes of action, or injury arising out of a breach of the representations and warranties set forth in Section 2.5(e)(ii)(A) or of the covenants set forth in Section 2.5(d).

(f) Effect of Termination or Expiration . Upon termination or expiration of this Agreement, the BP Hyperlink License and Bluegreen Hyperlink License shall immediately and automatically terminate. In such event, BP Online and Bluegreen shall terminate all hyperlinks between the Bass Pro Website and the Tracker Website on one hand, and the Bluegreen Website, the Bluegreen Timeshare Website and the Big Cedar Timeshare Website on the other hand.

Section 2.6 Mailing Lists .

(a) Bass Pro Mailing List . During the term of this Agreement, BP Trademarks does hereby grant a non-exclusive, limited license (the “ BP Mailing List License ”) to the Advertisers to use the Bass Pro Mailing List as is now or hereafter possessed, used, obtained or compiled by BP Trademarks solely for the purpose of marketing and promotion of the Timeshare Projects and Bluegreen’s Timeshare Facilities; provided , however , such use must also be in compliance with all applicable laws governing the use of such information, including, but not limited to any privacy laws applicable to such information.

(i) Access Rights . Use of the Bass Pro Mailing List and enjoyment of the BP Mailing List License by the Advertisers shall be administered by BP Trademarks or through a third party intermediary (a “ Mailing List Intermediary ”), in the discretion of BP Trademarks. The Advertisers shall collectively have the right to access the Bass Pro Mailing List for the purposes described herein twelve (12) times each calendar year for the term hereof commencing with calendar year 2008. If an Advertiser desires to access the Bass Pro Mailing List, such Advertiser shall provide written notice and an example of the proposed distribution materials to BP Trademarks, requesting that BP Trademarks distribute such materials to the persons on the Bass Pro Mailing List. No Advertiser shall have the right to review the Bass Pro Mailing List or any names on the Bass Pro Mailing List. Subject to approval of the materials by Bass Pro as provided in Section 5.2 , BP Trademarks shall, or shall engage a Mailing List Intermediary to, distribute the materials received from the Advertiser to the persons on the Bass Pro Mailing List within 30days after receipt of written notice and the distribution materials from the Advertiser. An Advertiser shall have no rights in the information of any person on the Bass Pro Mailing List until such person does business with such Advertiser.

(ii) Representations and Warranties . BP Trademarks represents and warrants to the Advertisers that the Bass Pro Mailing List is owned by BP Trademarks and that BP Trademarks has the power and authority to enter into and perform its obligations under the BP Mailing List License. BP Trademarks agrees to indemnify and hold harmless the Advertisers from any and all damages, losses, claims, causes of action or injury arising out of a breach of the representations and warranties set forth in this Section 2.6(a)(ii) .

(iii) Exclusivity / Non-Exclusivity . Except as otherwise specifically provided herein, the BP Mailing List License shall be non-exclusive to the Advertisers and BP Trademarks reserves the right to use the Bass Pro Mailing List in respect of any product or service. Nothing in this Agreement shall prevent BP Trademarks from granting any other licenses for the use of the Bass Pro Mailing List or from utilizing the Bass Pro Mailing List or permitting the Bass Pro Mailing List to be utilized by others in any manner whatsoever; provided , however , during the term of this Agreement, BP Trademarks shall not make the Bass Pro Mailing List available to any Competing Resort or any operator of any Competing Resort.

(iv) Consideration; Expenses . The BP Mailing List License is granted to the Advertisers at no further cost or expense to the Advertisers, and BP Trademarks agrees that the BP Mailing List License has been paid for in full so long as the Advertisers comply with their obligations set forth in this Agreement, including, without limitation, the timely payment by Bluegreen of Generation Commissions; provided , however , that the Advertisers shall pay the actual, reasonable costs and expense of BP Trademarks or any Mailing List Intermediary relating to each distribution, including formatting, media (labels, disks), and actual freight/postage.

(b) Big Cedar Mailing List . During the term of this Agreement, Big Cedar does hereby grant a non-exclusive, limited license (the “ Big Cedar Mailing List License ”) to the Advertisers to use the Big Cedar Mailing List as is now or hereafter possessed, used, obtained or compiled by Big Cedar for the purpose of marketing and promotion of the Timeshare Projects and Bluegreen’s Timeshare Facilities; provided , however , such use must also be in compliance with all applicable laws governing the use of such information, including, but not limited to any privacy laws applicable to such information.

(i) Access Rights . Use of the Big Cedar Mailing List and enjoyment of the Big Cedar Mailing List License by the Advertisers shall be administered by Big Cedar or through a Mailing List Intermediary, in the discretion of Big Cedar. The Advertisers shall have the right to access the Big Cedar Mailing List for the purposes described herein twelve (12) times each calendar year for the term hereof commencing with calendar year 2008. If an Advertiser desires to access the Big Cedar Mailing List, such Advertiser shall provide written notice and an example of the proposed distribution materials to Big Cedar, requesting that Big Cedar distribute such materials to the persons on the Big Cedar Mailing List. No Advertiser shall have the right to review the Big Cedar Mailing List or any names on the Big Cedar Mailing List. Subject to approval of the materials by Big Cedar as provided in Section 5.2 , Big Cedar shall, or shall engage a Mailing List Intermediary to, distribute the materials received from the Advertiser to the persons on the Big Cedar Mailing List within 30days after receipt of written notice and the distribution materials from the Advertiser. An Advertiser shall have no rights in the information of any person on the Big Cedar Mailing List until such person does business with such Advertiser.

(ii) Representations and Warranties . Big Cedar represents and warrants to the Advertisers that the Big Cedar Mailing List is owned by Big Cedar and that Big Cedar has the power and authority to enter into and perform its obligations under the Big Cedar Mailing List License. Big Cedar agrees to indemnify and hold harmless the Advertisers from any and all damages, losses, claims, causes of action or injury arising out of a breach of the representations and warranties set forth in this Section 2.6(b)(ii) .

(iii) Exclusivity / Non-Exclusivity . Except as otherwise specifically provided herein, the Big Cedar Mailing List License shall be non-exclusive to the Advertisers and Big Cedar reserves the right to use the Big Cedar Mailing List in respect of any product or service. Nothing in this Agreement shall prevent Big Cedar from granting any other licenses for the use of the Big Cedar Mailing List or from utilizing the Big Cedar Mailing List or permitting the Big Cedar Mailing List to be utilized by others in any manner whatsoever; provided , however , during the term of this Agreement, Big Cedar shall not make the Big Cedar Mailing List available to any Competing Resort or any operator of any Competing Resort.

(iv) Consideration; Expenses . The Big Cedar Mailing List License is granted to the Advertisers at no further cost or expense to the Advertisers, and Big Cedar agrees that the Big Cedar Hyperlink License has been paid for in full so long as the Advertisers comply with their obligations set forth in this Agreement, including, without limitation, the timely payment by Bluegreen of Generation Commissions; provided , however , that the Advertisers shall pay the actual, reasonable costs and expense of Big Cedar or any Mailing List Intermediary relating to each distribution, including formatting, media (labels, disks), and actual freight/postage.

(c) Bluegreen Mailing List . During the term of this Agreement, Bluegreen does hereby grant a non-exclusive, limited license (the “ Bluegreen Mailing List License ”) to Bass Pro, Affiliates of Bass Pro, Tracker Marine and Big Cedar (each, a “ BG Mailing List Licensee ,” and collectively, the “ BG Mailing List Licensees ”, to use the Bluegreen Mailing List as is now or hereafter possessed, used, obtained or compiled by Bluegreen solely for the promotional and marketing purposes of the BG Mailing List Licensees; provided , however , such use must also be in compliance with all applicable laws governing the use of such information, including, but not limited to any privacy laws applicable to such information.

(i) Access Rights . Use of the Bluegreen Mailing List and enjoyment of the Bluegreen Mailing List License by BG Mailing List Licensees shall be administered by Bluegreen or through a Mailing List Intermediary, in the discretion of Bluegreen. The BG Mailing List Licensees shall collectively have the right to access the Bluegreen Mailing List for the purposes described herein twelve (12) times each calendar year for the term hereof commencing with calendar year 2008. If a BG Mailing List Licensees desires to access the Bluegreen Mailing List, such BG Mailing List Licensee shall provide written notice and an example of the distribution materials to Bluegreen, requesting that Bluegreen distribute such materials to the persons on the Bluegreen Mailing List. No BG Mailing List Licensee shall have the right to review the Bluegreen Mailing List or any names on the Bluegreen Mailing List.Subject to approval of the materials by Bluegreen as provided in Section 2.6(c)(v) , Bluegreen shall, or shall engage a Mailing List Intermediary to, distribute the materials received from Bass Pro or Big Cedar to the persons on the Bluegreen Mailing List within 30days after receipt of

written notice and the distribution materials from a BG Mailing List Licensee. No BG Mailing List Licensee shall have any rights in the information of any person on the Bluegreen Mailing List until such person does business with one of them.

(ii) Consideration; Expenses . The Bluegreen Mailing List License is granted at no further cost or expense to the BG Mailing List Licensees; provided , however , that the BG Mailing List Licensees shall pay the actual, reasonable costs and expense of Bluegreen or any Mailing List Intermediary relating to each distribution, including formatting, media (labels, disks), and actual freight/postage.

(iii) Restrictions . Use of the Bluegreen Mailing List shall be limited, however, to offering to such persons identified therefrom, outdoor retail products of Bass Pro and its Affiliates and Tracker Marine, or lodging opportunities at the Big Cedar Lodge, so long as the same are not offered through or in relation to a Competing Resort.

(iv) Representations and Warranties . Bluegreen represents and warrants to each of the BG Mailing List Licensees that the Bluegreen Mailing List is owned by Bluegreen and that Bluegreen has the power and authority to enter into and perform its obligations under the Bluegreen Mailing List License. Bluegreen agrees to indemnify and hold harmless the BG Mailing List Licensees from any and all damages, losses, claims, causes of action or injury arising out of a breach of the representations and warranties set forth in this Section 2.6(c)(iv) .

(v) Approval . Samples of advertising material proposed to be delivered to persons on the Bluegreen Mailing List shall be submitted to and subject to the approval of Bluegreen prior to use. In the event of submission of any advertising, marketing and promotional program by a BG Mailing List Licensee, the same shall be deemed approved within fourteen (14) days of delivery thereof to Bluegreen, unless Bluegreen denies the approval or approves the same within an earlier period. Upon denial of any such approval, Bluegreen shall deliver to the applicable BG Mailing List Licensee specific reasons for such denial, and upon which cure thereof Bluegreen shall be deemed to have approved such advertising (it being agreed that any proposed cure shall be presented to Bluegreen for its subsequent review, comment and approval, whose approval shall not be unreasonably withheld and shall be deemed given unless Bluegreen denies that the cure has been successful within five (5) days from delivery thereof). Once approved, any such sample of advertising, marketing or promotional materials may be reused or incorporated into any advertising, marketing or promotional program of the BG Mailing List Licensees offering outdoor retail products or lodging opportunities at the Big Cedar Lodge as determined from time to time by the BG Mailing List Licensees without the necessity of further approval; provided , however , if following approval of any respective advertising, marketing or promotional materials, Bluegreen is notified that such approved advertising, marketing or promotional material is in violation of any applicable legal principles, then Bluegreen may notify the BG Mailing List Licensees that they are not to use such approved advertising, marketing or promotional materials until any claimed violation is cured; provided , however (i) Bluegreen may later withdraw such approval for any or no reason, in its sole discretion; and (ii) no advertising, marketing or promotional materials may incorporate the use of any Bluegreen mark unless such use has been approved by Bluegreen in its sole and absolute discretion.

(d) Effect of Termination or Expiration . Upon termination or expiration of this Agreement, the BP Mailing List License, the Big Cedar Mailing List License and the Bluegreen Mailing List License shall immediately and automatically terminate, and any and all information provided pursuant to such licenses shall be returned to its owner.

Section 2.7 Big Cedar Lodge .

(a) General . During the term of this Agreement, Big Cedar does hereby grant to the Advertisers the right to use the Big Cedar Lodge solely for the purpose of promoting, advertising, and marketing of the Timeshare Projects, as further described in this Section 2.7 .

(b) Prospect Occupancy . During the term of this Agreement, Big Cedar grants to the Advertisers, the right to use on a space available basis, rooms for occupancy and use by potential prospects for the marketing of timeshare interests. During the term of this Agreement, Big Cedar shall make guest rooms, common areas and facilities available to the Advertisers on a space available basis, which rooms may be used for occupancy and use by potential prospects for the marketing of timeshare interests. The Advertisers shall, as respects the marketing of timeshare interests at the Timeshare Projects, when overnight occupancy is needed in relation to such marketing, make every reasonable effort to place occupants in the Big Cedar Lodge to the extent that guest room space is available. Rates for such guest rooms, common areas and facilities shall be negotiated in good faith and charged on a Preferential Treatment basis as negotiated, taking into account seasonal rate fluctuation. Use of common areas and facilities for advertising and promotional purposes shall be subject to the prior approval of Big Cedar, including the content, location and placement of such advertising materials and promotional activities.

(c) Concierge Desk . During the term of this Agreement, Big Cedar does hereby grant a license to the Advertisers to operate a concierge desk (the “ Concierge Desk ”) and sufficient space for use thereof in the Big Cedar Lodge lobby for use by the Advertisers. The Concierge Desk and sufficient space for use thereof shall be provided to the Advertisers by Big Cedar from and after the date hereof, provided , that the Concierge Desk shall be the same size and in the same location as the Concierge Desk is located on the date hereof, and any changes thereto shall be in Big Cedar’s sole discretion. The Concierge Desk shall be staffed by personnel of the Advertisers and shall be utilized solely for the purpose of allowing introduction of guests to the opportunity to acquire a timeshare interest at the Timeshare Projects. The Concierge Desk and related desk space shall be provided by Big Cedar without charge or expense to the Advertisers.

(d) Personnel . The Concierge Desk shall be adequately staffed with competent personnel, who shall be employed by Bluegreen. In no event shall the Bluegreen personnel staffing the Concierge Desk engage in “high pressure salesmanship” in the solicitation or marketing to customers. Activities of Bluegreen personnel staffing the Concierge Desk shall be in a manner not offensive to the guests of the Big Cedar Lodge, and in compliance with all applicable requirements of law. Bluegreen shall indemnify and defend Big Cedar from any losses, damages, lawsuits or other claims resulting from the violation of the requirements set forth in this Section 2.7(d) or violations of law by Bluegreen personnel staffing the Concierge Desk. Notwithstanding anything to the contrary in this Agreement, Big Cedar shall have the

right to approve decisions by Bluegreen relating to personnel working in the Big Cedar Lodge and staffing the Concierge Desk, including the right, upon written notice to Bluegreen, to direct removal of any individual employee, consultant or other agent of the Advertisers from the Big Cedar Lodge for good cause shown, including, but not limited to, Big Cedar believing that the individual employee’s actions are detrimental to Big Cedar or the Big Cedar Lodge.

(e) Restriction . Notwithstanding anything herein to the contrary, the activities of the Advertisers at the Big Cedar Lodge shall only be used to promote and market the Timeshare Projects and their inclusion in the Bluegreen Vacation Club, and shall not otherwise be used to promote or market any Bluegreen Timeshare Facility.

(f) Occupancy List . Solely upon approval of the general manager of the Big Cedar Lodge, which approval shall not be unreasonably withheld, upon request of an Advertiser, Big Cedar will (if approved by such general manager) make the list of the names and contact information of the past and/or future guests of the Big Cedar Lodge available to the Advertisers solely for the purposes of marketing, promoting and selling timeshare interests in the Timeshare Projects and their inclusion in the Bluegreen Vacation Club, provided , however , that the list provided shall only include such information to the extent it is available and permitted to be shared with others pursuant to applicable law, and provided , further , that the use by the Advertisers shall be in compliance with all applicable laws governing the use of such information, including, but not limited to any privacy laws applicable to such information.

(g) Consideration; Expenses . The rights to use the Big Cedar Lodge set forth in this Section 2.7 are granted to the Advertisers at no further cost or expense to the Advertisers, and Big Cedar agrees that such rights have been paid for in full so long as the Advertisers comply with their obligations set forth in this Agreement, including, without limitation, the timely payment by Bluegreen of Generation Commissions.

Section 2.8 Signage .

(a) By execution hereof, the Shop Licensors do hereby grant to the Advertisers a limited, non-exclusive license to place advertising, promotional and marketing signage in the floor space marketing areas existing in the Bass Pro Shops, solely for the purpose of promoting, advertising, and marketing the Timeshare Projects and Bluegreen’s Timeshare Facilities. By execution hereof, Big Cedar does hereby grant to the Advertisers a limited, non-exclusive license to place advertising, promotional and marketing signage in the Big Cedar Lodge in accordance with the terms of this Agreement solely for the purpose of promoting, advertising, and marketing the Timeshare Projects and their inclusion in the Bluegreen Vacation Club. The specific location, placement, creation, design and content of such signage shall be subject to approval of the applicable Shop Licensor or Big Cedar, as applicable, which shall not be unreasonably withheld or denied. The Advertisers shall promptly comply with the reasonable requests of the Shop Licensors or Big Cedar to remove, replace or update the signage. Signage at Big Cedar Lodge shall be consistent, architecturally, with the existing signage located at the Big Cedar Lodge. Notwithstanding the foregoing, the parties agree that such signage is to exist and that the location, placement and content of such signage shall be maximized to promote the sale and marketing of timeshare interests at the Timeshare Projects and Bluegreen’s Timeshare Facilities. Despite anything contained herein to the contrary, no signage may incorporate use of

the Bass Pro Marks or the Big Cedar Marks unless such has been first approved by BP Trademarks with respect to the Bass Pro Marks or Big Cedar with respect to the Big Cedar Marks, as provided for in Section 2.9(c) .

(b) The licenses to place signage at Bass Pro Shops and Big Cedar Lodge set forth in this Section 2.8 are granted to the Advertisers at no further cost or expense to the Advertisers, and the Shop Licensors and Big Cedar agree that such licenses have been paid for in full so long as the Advertisers comply with their obligations set forth in this Agreement, including, without limitation, the timely payment by Bluegreen of Generation Commissions; provided , however , that the Advertisers shall be responsible for all expenses incurred relative to the creation, placement and removal of such signage.

Section 2.9 Tradenames and Marks .

(a) Bass Pro Marks . During the term of this Agreement, BP Trademarks hereby grants to the Advertisers, and the Advertisers hereby accept, a limited, non-exclusive, license (the “ BP Marks License ”) to use the Bass Pro Marks, on the terms and subject to the conditions and restrictions set forth herein. The Advertisers shall have no interest in or right to use the Bass Pro Marks except as set forth herein.

(i) Use of Bass Pro Marks . Permission to use the Bass Pro Marks under the BP Marks License shall be limited to use, and the Advertisers agree to use the Bass Pro Marks, solely in connection with the advertising, marketing and promoting of the Timeshare Projects, the Bluegreen Timeshare Facilities and their inclusion in the Bluegreen Vacation Club. Subject to BP Trademarks’ approval right set forth in Section 2.9(c) , the Bass Pro Marks may be used by the Company and Bluegreen in all promotional materials, advertisements, and other materials for the promotion, marketing and sale of the Timeshare Projects or the Bluegreen Timeshare Facilities.

(ii) Exclusivity/Non-Exclusivity of License . Except as otherwise specifically provided herein, the BP Marks License shall be non-exclusive to the Advertisers, and BP Trademarks reserves the right to use the Bass Pro Marks on, or in respect of, any product or service. Nothing in this Agreement shall prevent BP Trademarks from granting any other licenses for the use of the Bass Pro Marks or from utilizing the Bass Pro Marks or permitting the Bass Pro Marks to be utilized by others in any manner whatsoever; provided , however , that, during the term of this Agreement, BP Trademarks agrees that it shall not grant any other licenses for use of the Bass Pro Marks for the purpose of developing, marketing, promoting or advertising any Competing Resort, except as may otherwise be expressly provided for herein.

(iii) BP Trademarks represents and warrants to the Advertisers that it owns or has the right to use the Bass Pro Marks, and has the power and authority to enter into and perform its obligations under the BP Marks License. BP Trademarks agrees to indemnify and hold harmless the Advertisers from any and all damages, losses, claims, causes of action or injury arising out of a breach of the representations and warranties of this Section 2.9(a)(iii) .

(iv) Ownership of Bass Pro Marks .

(A) The Advertisers specifically acknowledge that BP Trademarks is the owner of the Bass Pro Marks and all associated goodwill therewith. In connection with the use of the Bass Pro Marks, no Advertiser shall in any manner represent that it has any ownership in the Bass Pro Marks or any registrations thereof and nothing in this Agreement shall give any Advertiser any ownership interest in any of the Bass Pro Marks other than the right to use the Bass Pro Marks in accordance with this Agreement. The Advertisers’ use of the Bass Pro Marks inures solely to BP Trademark’s benefit.

(B) No Advertiser will, during the term of this Agreement or at any time thereafter, attack the validity of any of the Bass Pro Marks or BP Trademarks’ interests therein, nor will any Advertiser attack any application for registration of any of the Bass Pro Marks, or take any position contrary to that of BP Trademarks in any proceedings pertaining to registration of any of the Bass Pro Marks.

(C) The Advertisers shall, whether during or after the term of this Agreement, execute and deliver to BP Trademarks such documents as BP Trademarks may reasonably request to establish or confirm BP Trademarks’ ownership interest in BP Bass Pro Marks. If, at any time, the Advertisers acquire any rights in, or trademark registrations or applications for, Bass Pro Marks or any confusingly similar marks by operation of law or otherwise in any jurisdiction, Advertisers will immediately upon request by BP Trademarks and at no expense to BP Trademarks, assign such rights, registrations, or applications to BP Trademarks, along with any and all associated goodwill.

(v) Unauthorized Use . The Advertisers will notify BP Trademarks in writing of any unauthorized use of any of the Bass Pro Marks which come to the Advertisers’ attention and BP Trademarks will proceed diligently, at its own expense and under its sole control, to prevent any such unauthorized use of the Bass Pro Marks. The Advertisers will assist BP Trademarks, as reasonably requested by BP Trademarks, in addressing such unauthorized use.

(vi) Infringement . The Advertisers will notify BP Trademarks promptly in writing of any claim that the use of any of the Bass Pro Marks infringes the rights of others, or of the institution of any legal actions or suits predicated upon such claimed infringement, and any such suit or action will be diligently defended at the sole expense of and under the sole control of BP Trademarks.

(vii) Effect of Termination or Expiration . Upon termination or expiration of this Agreement, all rights and licenses granted to the Advertisers hereunder shall immediately and automatically terminate. In such event, the Advertisers agree to discontinue all uses of the Bass Pro Marks and any words confusingly similar thereto upon termination or expiration. Each Advertiser agrees that it will at no time adopt or use, without BP Trademarks’ prior written consent, a word or mark which is reasonably likely to be similar to or confused with any of the Bass Pro Marks. BP Trademarks shall retain sole authority and control over the use of the Bass Pro name and over all of the Bass Pro Marks, and all rights in the Bass Pro Marks shall remain the property of BP Trademarks.

(viii) Reservation of Rights in the Bass Pro Marks . Rights in the Bass Pro Marks, other than those specifically granted herein, are reserved by BP Trademarks for its own use.

(ix) Costs . The BP Marks License shall be granted to the Advertisers at no further cost or expense to the Advertisers, and BP Trademarks agrees that the BP Marks License has been paid for in full so long as the Advertisers comply with their obligations set forth in this Agreement, including, without limitation, the timely payment by Bluegreen of Generation Commissions.

(b) Big Cedar Marks . During the term of this Agreement, Big Cedar hereby grants to the Advertisers, and the Advertisers hereby accept, a limited, non-exclusive, license (the “ Big Cedar Marks License ”) to use the Big Cedar Marks, on the terms and subject to the conditions and restrictions set forth herein. The Advertisers shall have no interest in or right to use the Big Cedar Marks except as set forth herein.

(A) Use of Big Cedar Marks . Permission to use the Big Cedar Marks under the Big Cedar Marks License shall be limited to use, and the Advertisers agree to use the Big Cedar Marks, solely in respect to the identity, location and name of the Timeshare Projects or in connection with advertising, marketing and promoting the Timeshare Projects, the Bluegreen Timeshare Facilities and their inclusion in the Bluegreen Vacation Club. Subject to Big Cedar’s approval right set forth in Section 2.9(c) , the Big Cedar Marks may be used by the Company and Bluegreen in all promotional materials, advertisements, and other materials for the promotion, marketing and sale of the Timeshare Projects or the Bluegreen Timeshare Facilities.

(ii) Exclusivity/Non-Exclusivity of License . Except as otherwise specifically provided herein, the Big Cedar Marks License shall be non-exclusive to the Advertisers, and Big Cedar reserves the right to use the Big Cedar Marks on, or in respect of, any product or service.Nothing in this Agreement shall prevent Big Cedar from granting any other licenses for the use of the Big Cedar Marks or from utilizing the Big Cedar Marks or permitting the Big Cedar Marks to be utilized by others in any manner whatsoever; provided , however , that, during the term of this Agreement, Big Cedar agrees that it shall not grant any other licenses for use of the Big Cedar Marks for the purpose of developing, marketing, promoting or advertising any Competing Resort, except as may otherwise be expressly provided for herein.

(iii) Big Cedar represents and warrants to the Advertisers that it owns or has the right to use the Big Cedar Marks, and has the power and authority to enter into and perform its obligations under the Big Cedar Marks License. Big Cedar agrees to indemnify and hold harmless the Advertisers from any and all damages, losses, claims, causes of action or injury arising out of a breach of the representations and warranties of this Section 2.9(b)(iii) .

(iv) Ownership of Big Cedar Marks .

(A) The Advertisers specifically acknowledge that Big Cedar is the owner of the Big Cedar Marks and all associated goodwill therewith. In connection with the use of the Big Cedar Marks, no Advertiser shall in any manner represent that it has any ownership in the Big Cedar Marks or any registrations thereof and nothing in this Agreement

shall give any Advertiser any ownership interest in any of the Big Cedar Marks other than the right to use the Big Cedar Marks in accordance with this Agreement. The Advertisers’ use of the Big Cedar Marks inures solely to Big Cedar’s benefit.

(B) No Advertiser will, during the term of this Agreement or at any time thereafter, attack the validity of any of the Big Cedar Marks or Big Cedar’s interests therein, nor will any Advertiser attack any application for registration of any of the Big Cedar Marks, or take any position contrary to that of Big Cedar in any proceedings pertaining to registration of any of the Big Cedar Marks.

(C) The Advertisers shall, whether during or after the term of this Agreement, execute and deliver to Big Cedar such documents as Big Cedar may reasonably request to establish or confirm Big Cedar’s ownership interest in Big Cedar Marks. If, at any time, the Advertisers acquire any rights in, or trademark registrations or applications for, Big Cedar Marks or any confusingly similar marks by operation of law or otherwise in any jurisdiction, Advertisers will immediately upon request by Big Cedar and at no expense to Big Cedar, assign such rights, registrations, or applications to Big Cedar, along with any and all associated goodwill.

(v) Unauthorized Use . The Advertisers will notify Big Cedar in writing of any unauthorized use of any of the Big Cedar Marks which come to the Advertisers’ attention and Big Cedar will proceed diligently, at its own expense and under its sole control, to prevent any such unauthorized use of the Big Cedar Marks. The Advertisers will assist Big Cedar, as reasonably requested by Big Cedar, in addressing such unauthorized use.

(vi) Infringement . The Advertisers will notify Big Cedar promptly in writing of any claim that the use of any of the Big Cedar Marks infringes the rights of others, or of the institution of any legal actions or suits predicated upon such claimed infringement, and any such suit or action will be diligently defended at the sole expense of and under the sole control of Big Cedar.

(vii) Effect of Termination or Expiration . Upon termination or expiration of this Agreement, all rights and licenses granted to the Advertisers hereunder shall immediately and automatically terminate. In such event, the Advertisers agree to discontinue all uses of the Big Cedar Marks and any words confusingly similar thereto upon termination or expiration. Each Advertiser agrees that it will at no time adopt or use, without Big Cedar’s prior written consent, a word or mark which is reasonably likely to be similar to or confused with any of the Big Cedar Marks. Big Cedar shall retain sole authority and control over the use of its name and over all of the Big Cedar Marks, and all rights in the Big Cedar Marks shall remain the property of Big Cedar.

(viii) Reservation of Rights in the Big Cedar Marks . Rights in the Big Cedar Marks, other than those specifically granted herein, are reserved by Big Cedar for its own use.

(ix) Costs . The Big Cedar Marks License shall be granted to the Advertisers at no further cost or expense to the Advertisers, and Big Cedar agrees that the Big

Cedar Marks License has been paid for in full so long as the Advertisers comply with their obligations set forth in this Agreement, including, without limitation, the timely payment by Bluegreen of Generation Commissions.

(c) Approval Procedure . Authorization for each use by the Advertisers of the Marks pursuant to the BP Marks License and the Big Cedar Marks License is subject to the prior approval of BP Trademarks (in the case of the Bass Pro Marks) or Big Cedar (in the case of the Big Cedar Marks). Samples shall be submitted for approval to BP Trademarks or Big Cedar, as applicable, at 2500 East Kearney Street, Springfield, Missouri 65898. As respects the Bass Pro Marks, approval of use of a Bass Pro Mark shall be deemed given if not granted or denied within thirty (30) calendar days after receipt at the above address of the sample, including the proposed use of the Bass Pro Mark. As respects the Big Cedar Mark, approval of use of the Big Cedar Mark shall be deemed given if not granted or denied within fourteen (14) calendar days after receipt at the above address of the sample including the proposed use of the Big Cedar Mark. Upon denial of any such proposed use of the Big Cedar Mark, Big Cedar shall deliver to the Advertisers its specific reasons for such denial. Upon cure thereof, the Advertisers may proceed to use such advertising, marketing and promotional material. Any proposed cure in respect to a denial shall be submitted to Big Cedar for further approval, whose approval shall not be unreasonably withheld or denied, and whose approval shall be deemed given if denial thereof is not delivered within five (5) days of delivery of the proposed cure. Once approved, any such sample of advertising, marketing and promotional program may be re-used or incorporated into any advertising, marketing or promotional program for the foregoing, as determined from time to time by Bluegreen or the Company, without necessity of further approval. Notwithstanding the foregoing, BP Trademarks and Big Cedar reserve the right to withdraw any approval of a Bass Pro Mark or Big Cedar Mark, respectively, at any time.

(d) Subject to Section 2.9(c) , Big Cedar shall provide and deliver to the Advertisers creative materials containing the Big Cedar Mark for the purpose of developing and implementing such advertising, promotional and marketing programs and opportunities incorporating the Big Cedar Marks. BP Trademarks shall provide and deliver to the Advertisers creative materials containing the Bass Pro Marks for the purpose of developing and implementing such advertising, promotional and marketing programs and opportunities incorporating the Bass Pro Marks. Delivery and use of the creative materials shall be without charge or expense (and the licenses hereunder are agreed to have been paid for in full), excepting, however, the Company shall pay the actual costs incurred by Big Cedar for delivery of the creative materials, and the Advertisers shall equally pay the costs of BP Trademarks for delivery of the creative materials. Bluegreen shall be entitled, at its sole cost and expense to take pictures, videos and other reproductions and depictions of the Big Cedar Lodge and the respective Bass Pro Shops, including all facilities, and to utilize such pictures and depictions in its promotional materials relating to the Timeshare Projects, Bluegreen Timeshare Facilities, Bluegreen Vacation Club and the Timeshare Projects’ inclusion in the Bluegreen Vacation Club. Such pictures, videos and other reproductions and depictions shall, prior to use, be subject to the approval of BP Trademarks or Big Cedar in accordance with the procedures set forth in Section 2.9(c) and the requirements of Section 2.11 .

(e) Each of the BP Marks License and the Big Cedar Marks License shall be non-transferable and non-assignable, and in no event shall either Advertiser be entitled to grant

any liens against or sublicenses to use either the BP Marks License and the Big Cedar Marks License.

Section 2.10 Preferential Treatment . During the term of this Agreement, and except as otherwise provided in this Agreement, the BP/BC Marketing Channels and any other marketing and promotional advantages and opportunities or any other services hereunder for which any of the Advertisers are to pay to any of the Service Providers an amount, shall, in all events, be made available to the Company and Bluegreen on a Preferential Treatment basis.

Section 2.11 Proprietary Information All graphics, photographs, videos, any and all trademarks, servicemarks, tradenames, copyrights, patents or other intellectual property owned by any Service Provider, Affiliate of any Service Provider, Tracker Marine, Bluegreen, the Company or Affiliates of Bluegreen as of the date hereof (the “ Intellectual Property ”) will, at all times, remain the owner’s respective property. Each party hereto acknowledges and agrees that, at all times, the ownership of the Intellectual Property is vested solely in the owner thereof. All parties further acknowledge and agree that nothing in this Agreement shall give any other party any right, title or interest in the Intellectual Property of another party except as expressly provided herein. Any party’s use of the Intellectual Property shall at all times and in every instance be followed by the proper Intellectual Property designation (for example, ™, ®, or ©).

Section 2.12 Other Promotional Agreements and Channels

(a) Cross Promotional Strategies . During the term of this Agreement, the parties shall negotiate, in good faith, promotional advantages or opportunities now existing or as may hereafter be identified, including cross-promotional strategies, as well as services as may otherwise be available and identified as may be beneficial to the Advertisers in the marketing and promotion of timeshares and as may be beneficial to the Service Providers and their Affiliates in the marketing and promotion of outdoor retail products. The cross-promotional strategies and programs may include by way of example and not limitation, radio and television commercials (including infomercials, announcements, promotions, advertisements on in-room televisions at Big Cedar Lodge), newspaper and magazine advertisements, billboards, card and tent promotions in respective accommodations and facilities (such as Big Cedar Lodge and Bass Pro Shops), leaflets, postcards and website opportunities. The foregoing shall only be developed on mutual agreement of the parties and shall not otherwise reduce or limit the services otherwise agreed to herein.

(b) Employees . During the term of this Agreement, Big Cedar and the Shop Licensors shall make available their respective employees who have customer contact for training by Bluegreen respecting the details of the timesharing concept, and instructions and directions on how such employees may inform customers of Big Cedar and Bass Pro Shops about timeshare opportunities and how such employees are to be supportive of the timeshare marketing opportunities at the Timeshare Projects and Bluegreen’s Timeshare Facilities, provided , however , that such training shall be at Bluegreen’s expense and in the manner, and at such times and places, as the Shop Licensors or Big Cedar, as applicable, deem reasonable and appropriate and not interfering with normal business operations.

(c) Promotional Retail Gift Cards . In the event that the Advertisers elect to use retail merchandise or gift cards for retail merchandise as incentives to encourage timeshare tours or sales presentations as respects the Timeshare Projects, such merchandise and/or gift cards shall be acquired from Bass Pro or BPIP, respectively, so long as such merchandise and/or gift cards are readily available, without delay or interference with the Company’s or Bluegreen’s routine time framework, at prices competitive with what the Advertisers would customarily pay for the same or similar merchandise and/or gift cards. The Advertisers shall receive a ten percent (10%) price discount off the lowest offered price for all standard full selection merchandise. Gift cards obtained from BPIP pursuant to this Section 2.12(c) shall be subject to the following terms and conditions: (i) Advertisers shall pay BPIP for the gift cards within thirty (30)days after receipt; (ii) the Advertisers shall not be entitled to any breakage on the gift cards; (iii) BPIP shall not be responsible for lost or stolen cards; (iv) the Advertisers shall not sell, and shall make reasonable attempts to prevent other from selling, the gift cards on the internet through ebay or similar websites; (v) the gift cards shall become void after two years of non-use (except where prohibited by law); and (vi) the Advertisers shall not modify the gift cards in any way. The Advertisers shall not be restricted from purchasing non-merchandise premiums such as lodging accommodations, travel opportunities or other non-merchandise premiums from third parties unrelated to the Service Providers and their Affiliates, other than BP/Tracker Competitors. Service Providers acknowledge that the agreement of Bluegreen under this Section 2.12(c) is given in partial consideration of the obligations of Bluegreen hereunder. Coupons for services offered by Big Cedar Lodge shall be subject to review and approval of Big Cedar in its sole discretion. In addition to the foregoing, coupons for services will be offered by Big Cedar to the Advertisers as incentives to encourage timeshare tours or sales presentations as respects the Timeshare Projects. Such coupons will be issued with the dollar limitation and honored, provided Big Cedar shall be entitled to reimbursement from the Advertisers for the total amount of coupons redeemed on a monthly basis, within twenty (20) days of receipt by the Advertisers of invoices from Big Cedar.

(d) Tracker Boats . From and after the date hereof, if Bluegreen or the Company acquire for use at the Timeshare Projects or Bluegreen’s Timeshare Facilities boats similar to boats manufactured by Tracker Marine, then Bluegreen or the Company shall acquire such boats from Tracker Marine Retail, LLC or an Affiliate of Tracker Marine Retail, LLC, so long as the acquisition thereof, including pricing and terms, are at least as favorable for similar products as the discount terms available to Big Cedar Lodge as of the date of this Agreement (or if such discount terms are more favorable at the time of acquisition, are at least as favorable as such terms at that time). The parties hereto acknowledge that the agreement of Bluegreen under this Section 2.12(d) is given in partial consideration of the obligations of the parties hereunder. The restrictions contained in this Section 2.12(d) shall terminate in the event that Tracker Marine files or has filed against it a bankruptcy proceeding.

Section 2.13 Lead Generation Programs . No Advertiser shall develop any lead generation programs not specifically authorized in this Agreement using any BP/BC Marketing Channel without the prior written consent of Bass Pro or Big Cedar, which consent may be withheld in Bass Pro’s or Big Cedar’s sole discretion.

ARTICLE III - RESTRICTIONS

Section 3.1 Restriction on BP/BC Marketing Channels .

(a) During the term of this Agreement except as otherwise provided in this Agreement, the Service Providers shall not:

(i) provide the BP/BC Marketing Channels, nor make them available or offer them to or allow them to be taken advantage of, by any Competing Resort or the operator thereof (except as may otherwise be provided in accordance with Section 2.3(d)) ; or

(ii) sell, market, advertise, develop or promote any Resort Interest Program, excepting, however, the Timeshare Projects, the Bluegreen Vacation Club, any Bluegreen Timeshare Facility as offered by Bluegreen, and any Fractional Interest Development. Notwithstanding the foregoing, it is agreed that the Service Providers (and their Affiliates) may continue to operate the projects owned or controlled by them or their Affiliates at the following locations: Valhalla Island, Florida; Floridian Sports Club; Welaka, Florida; Frying Pan River Ranch, Colorado; Komaham Lodge, British Columbia; the parcel of land known as the “Stonecroft” property, Missouri; or at any property owned now or in the future by American Sportsman Holdings Co. The Service Providers shall be permitted to sell, develop, market, advertise or promote any whole ownership real estate development.

(b) The restrictions contained in Section 3.1(a) shall terminate in the event that Bluegreen or Bluegreen Corporation files or has filed against either of them a bankruptcy proceeding.

Section 3.2 Restriction on Bluegreen Marketing Channels .

(a) During the term of this Agreement, and except as otherwise provided in this Agreement, neither Bluegreen nor its Affiliates shall (i) provide, sell, license or otherwise make available use of the Bluegreen Mailing List to any BP/Tracker Competitor, or (ii) create, maintain, license or allow to be present on the Bluegreen Website or the Bluegreen Timeshare Website any icons or hyperlinks to any website that is owned or operated by any BP/Tracker Competitor.

(b) The restriction set forth in Section 3.2(a) shall terminate:

(i) with respect to BP/Tracker Competitors who sell outdoor recreational products, equipment or services that directly compete with the outdoor recreational products, equipment and services of Bass Pro, upon the occurrence of a Bankruptcy Event with respect to Bass Pro;

(ii) with respect to BP/Tracker Competitors who sell outdoor recreational products, equipment or services that directly compete with the outdoor recreational products, equipment and services of Tracker Marine, upon the occurrence of a Bankruptcy Event with respect to Tracker Marine; and

(iii) with respect to BP/Tracker Competitors who sell outdoor recreational products, equipment or services that directly compete with the outdoor recreational products, equipment and services of Tracker Marine Retail, LLC, upon the occurrence of a Bankruptcy Event with respect to Tracker Marine Retail, LLC.

(c) Bluegreen’s Realization of Benefits . The Service Providers acknowledge that the realization of the benefits under this Marketing Agreement by the Advertisers is dependent upon the Advertisers’ ability to market the timeshare interests of the Timeshare Projects and Bluegreen’s Timeshare Facilities and maximize the growth of sales of such interests and that any form of direct or indirect competition from the Service Providers, except as provided herein, is inconsistent with its intended purpose. The terms of this Agreement were negotiated giving consideration to the concept that competition by Competing Resorts to the sale, marketing and promotion of timeshare interests through the BP/BC Marketing Channels will deprive the Advertisers of a bargained for consideration.

ARTICLE IV - GENERATION COMMISSION

Section 4.1 Generation Commission .

(a) In consideration for the use of the BP/BC Marketing Channels, Bluegreen shall pay to Big Cedar, for Big Cedar and on behalf of the other Service Providers, a commission (the “ Generation Commission ”) for each timeshare interest in a Bluegreen Timeshare Facility that is sold by Bluegreen or a Bluegreen Affiliate to a buyer that is generated through the BP/BC Marketing Channels, whether sold prior to or after the termination of this Agreement. A buyer shall be deemed to be generated through a BP/BC Marketing Channel (and a sale to such buyer shall give rise to a Generation Commission) if such buyer is uniquely identified through a BP/BC Marketing Channel, accepts a promotional marketing offer from Bluegreen or a Bluegreen Affiliate, and acquires a timeshare interest in one of Bluegreen’s Timeshare Facilities at any time thereafter.

(i) The Generation Commission shall be in an amount equal to seven percent (7%) of the Net Sales Volume if the buyer (1) is generated through a BP/BC Marketing Channel, (2) accepts a promotional marketing offer from Bluegreen or a Bluegreen Affiliate within one hundred eighty (180) days of delivery of such promotional marketing offer, (3) acquires a timeshare interest in one of Bluegreen’s Timeshare Facilities at any time thereafter without additional marketing expense to Bluegreen or a Bluegreen Affiliate, other than the expense of fulfillment of the promotional marketing offer so made, and (4) generally follows the track as set forth in Exhibit C attached hereto and incorporated herein by this reference.

(ii) The Generation Commission shall be in an amount equal to three and one half percent (3.5%) of the Net Sales Volume if the buyer (1) is generated through a BP/BC Marketing Channel, (2) accepts a promotional marketing offer from Bluegreen or a Bluegreen Affiliate after one hundred eighty (180) days of delivery of such promotional marketing material, and (3) acquires a timeshare interest in one of Bluegreen’s Timeshare Facilities at any time thereafter despite additional marketing expense to Bluegreen or a Bluegreen Affiliate.

(iii) For purposes of the foregoing, a prospect may be deemed unique through production from one source under this Agreement as well as unique through production from another source under this Agreement. In no event, however, shall an individual timeshare sale yield more than one (1) Generation Commission (either 7% or 3.5%).

(iv) Notwithstanding the foregoing, in no event will a Generation Commission be payable for sales of timeshare interests in the Timeshare Projects, or sales of timeshare interests in the Bluegreen Vacation Club that are predicated upon conveyance of a timeshare interest at any of the Timeshare Projects.

(b) Tracking and Accounting for the Generation Commission . Bluegreen shall establish and maintain a system of audit and reporting of sales and Generation Commissions, and shall provide to Big Cedar, on a monthly basis, an accounting (each, a “ Commission Report ”) for the Generation Commissions that were earned in the preceding month, along with a statement of the current amount of the unearned Annual Prepayment (as defined below) for the current year. In addition, Bluegreen shall establish a tracking system regarding production and generation of sales prospects for purposes of determining whether or not a sale is generated as a result of the BP/BC Marketing Channels as provided for in this Agreement, and it is agreed that the tracking system set forth on Exhibit C attached hereto is an acceptable tracking system. ¹

(c) Bluegreen will provide the Service Providers complete access to and right to audit the books and records of Bluegreen with respect to the Generation Commissions and Commission Reports, no more than twice per year, at the sole expense of the Service Provider accessing such books and records and/or conducting such audit. If such audit by a Service Provider demonstrates an underpayment of Generation Commissions greater than 3% in any period, the Advertisers shall reimburse the applicable Service Provider for the cost of the audit (along with the amount of the underpayment, which shall be payable to Big Cedar regardless of the amount of the underpayment).

Section 4.2 Annual Prepayments .

(a) On or before January 1 of each calendar year in which this Agreement is in effect, Bluegreen shall pay to Big Cedar, in cash, an advance on the Generation Commissions that are estimated to be payable for the upcoming year (each, an “ Annual Prepayment ”). The Annual Prepayment shall be advance payment for Generation Commissions to be earned in the upcoming year, and no interest shall accrue on the Annual Prepayment.

(b) The Annual Prepayment for calendar year 2008 shall be equal to $4,000,000.00. The parties acknowledge and agree that Bluegreen has paid the Annual Prepayment for 2008 as of the date hereof.

(c) The Annual Prepayment for each calendar year after 2008 shall be paid on or before the first business day of such calendar year and shall equal to the lesser of (i) 100% of the estimated amount of Generation Commissions that will be generated during the upcoming


^¹	Big Cedar requests a simplified tracking system and new “ Exhibit C ”

calendar year, as such estimated amount is determined by Big Cedar and Bluegreen; and (ii) $5,000,000. As they are earned, the Generation Commissions shall be credited toward the current year’s Annual Prepayment.

(d) If, during the term of this Agreement, the Service Providers or their Affiliates elect to make Approved Alternative Marketing Programs available to the Company and/or Bluegreen, and the Company and/or Bluegreen elects to participate in such Approved Alternative Marketing Programs, the amounts of the agreed costs, fees or commissions payable by the Company and/or Bluegreen for use of such Approved Alternative Marketing Programs may also be credited toward the outstanding portion of the current year’s Annual Prepayment, if any.

(e) After the aggregate amount of the Generation Commissions earned (and other amounts payable by the Company and/or Bluegreen pursuant to Section 4.2(d)) in a year reaches the amount of the Annual Prepayment applicable to such year, Bluegreen shall pay to Bass Pro in cash, on a monthly basis, within 15 days after the end of each month, the Generation Commissions earned during the preceding month.

(f) Notwithstanding any termination of this Agreement, any Generation Commissions (and other amounts payable by the Company and/or Bluegreen pursuant to Section 4.2(d)) arising after the termination of this Agreement (“ Post-Termination Generation Commissions ”) shall be credited against any Shortfall pursuant to Section 4.2(g) , or if no such Shortfall exists, shall be paid to Bass Pro in cash, on a monthly basis, within 15 days after the end of each month.

(g) If the aggregate amount of the Generation Commissions earned (and other amounts payable by the Company and/or Bluegreen pursuant to Section 4.2(d)) in any year does not reach the amount of such year’s Annual Prepayment, then the difference (the “ Shortfall ”) between such year’s Annual Prepayment and the amount of the Generation Commissions (and other amounts payable by the Company and/or Bluegreen pursuant to Section 4.2(d)) that were earned during that year shall be applied to the next year’s Annual Prepayment, such that the amount payable by Bluegreen for the year following a year in which there is a Shortfall will be reduced by the amount of such Shortfall. If this Agreement is terminated during or at the end of a year in which there is a Shortfall, Bass Pro shall pay to Bluegreen fifty percent (50%) of the amount of the Shortfall within 60 days after the Agreement is terminated and the balance of Shortfall within 120 days after the Agreement is terminated; provided , however that the amount of any Post-Termination Generation Commissions shall be credited against the Shortfall.

ARTICLE V - PERMITTED USE; CONTENT; APPROVAL RIGHTS

Section 5.1 Permitted Use .

(a) The BP/BC Marketing Channels shall be used by the Company and Bluegreen to promote, market and advertise the Timeshare Projects, Bluegreen’s Timeshare Facilities and their inclusion in the Bluegreen Vacation Club, and in accordance with the terms of this Agreement.

(b) The Service Providers reserve the right, in their sole discretion, to limit the amount of use of the BP/BC Marketing Channels, to edit, revise or reject any marketing and promotional materials, and to cancel any use by the Advertisers of the BP/BC Marketing Channels, provided , that prior to exercising the foregoing rights, the Service Providers shall provide written notice of such intent and the reasons therefor, which notice shall provide the Advertisers with a reasonable period of at least 30 days to respond and cure. Any timely cure proposed by the Advertisers shall be subject to the approval of the applicable Service Provider, which shall not be unreasonably withheld. The Service Providers reserve the right to suspend the Advertisers’ use of the BP/BC Marketing Channel for purposes of the activity that was the reason for the notice of intent to terminate during such cure period.

(c) The Service Providers reserve the right, in their sole discretion, to discontinue any BP/BC Marketing Channel at any time and for any reason, which may include, without limitation, closing any Bass Pro Shop and discontinuing publication of any or all of the Bass Pro Catalogs. In the event that a Service Provider intends to discontinue a BP/BC Marketing Channel, such Service Provider shall make reasonable efforts to provide advance notice to the Advertisers.

Section 5.2 Content and Approval Rights .

(a) Bass Pro, on behalf of the Service Providers, shall have the right to review and approve all advertising materials to be used in the Bass Pro Shops or Bass Pro Catalogs or that involve contact with customers of Bass Pro Shops or identified through the Bass Pro Mailing List prior to such use. Big Cedar shall have the right to review and approve all advertising materials to be used in the Big Cedar Lodge, that involve contact with the guests of Big Cedar Lodge or that involve contact with customers identified through the Big Cedar Mailing List prior to such use. Any advertising material so approved shall be maintained by Bluegreen in a file designated as approved advertisements. Such advertising material proposed to be delivered shall be submitted to Bass Pro or Big Cedar, at 2500 East Kearney Street, Springfield, Missouri 65898 prior to use.

(b) In the event of submission of any such sample of advertising, marketing and promotional materials by the Advertisers hereunder, the same shall be deemed approved within fourteen (14) days after receipt thereof, at the address set forth above, unless Bass Pro or Big Cedar denies approval or approves the same within an earlier time period. Upon denial of any such approval, Bass Pro or Big Cedar shall deliver to the Advertisers (whomsoever shall be the party that has delivered the advertisement to Bass Pro or Big Cedar) specific reasons for such denial upon which cure thereof the Advertisers may proceed to use such advertising, marketing and promotional material. Any proposed cure in respect to a denial shall be submitted by the respective party to Bass Pro or Big Cedar for further approval, whose approval shall not be unreasonably withheld or denied, and whose approval shall be deemed given if denial thereof is not delivered within five (5) days of delivery of the proposed cure.

(c) Once approved, any advertising, marketing or promotional program approved for use at the Big Cedar Lodge may be reused or incorporated into any advertising, marketing or promotional program for any or all of the Bluegreen Timeshare Facilities, as determined from time to time by Bluegreen without necessity of further approval; provided ,

however , that Big Cedar or Bass Pro may later withdraw such approval for any or no reason, in their sole discretion.

(d) Despite anything contained herein to the contrary, no advertising, marketing or promotional materials may (i) incorporate use of the Bass Pro Mark unless such use has been first approved by BP Trademarks in its sole and absolute discretion; or (ii) incorporate use of the Big Cedar Mark unless such use has been first approved by Big Cedar, in its sole and absolute discretion.

ARTICLE VI - INDEMNIFICATION / LIMITATION OF LIABILITY

Section 6.1 Indemnification—Bluegreen . Bluegreen agrees to indemnify and hold the Service Providers harmless from and against any and all liability, loss or expense (including reasonable attorneys fees and similar expenses) arising from any claims, including but not limited to, libel, unfair competition, unfair trade practices, illegal or improper employment practices, plagiarism, infringement of trademark, trade names or patents, or copyrights, violation of rights of privacy, or violation of securities or blue sky laws, resulting from Bluegreen’s use of the BP/BC Marketing Channels and for breach of its obligations under this Agreement, except as a result of Service Providers’ willful misconduct or gross negligence.

Section 6.2 Indemnification –The Company . The Company agrees to indemnify and hold the Service Providers harmless from and against any and all liability, loss or expense (including reasonable attorneys fees and similar expenses) arising from any claims, including but not limited to, libel, unfair competition, unfair trade practices, illegal or improper employment practices, plagiarism, infringement of trademark, trade names or patents, or copyrights, violation of rights of privacy, or violation of securities or blue sky laws, resulting from the Company’s use of the BP/BC Marketing Channels and for breach of its obligations under this Agreement, except as a result of Service Providers’ willful misconduct or gross negligence.

Section 6.3 Indemnification – Service Provider . The Service Providers agree to indemnify and hold the Company and Bluegreen harmless from and against all liability, loss or expense (including reasonable attorneys’ fees and similar expenses) arising from any claims resulting from Service Provider’s breach of its obligations under this Agreement except as a result of Company’s or Bluegreen’s (as applicable) willful misconduct or gross negligence.

Section 6.4 Limitation of Liability . The Advertisers agree that the aggregate amount of the Service Providers’ liability in relation to any and all acts, omissions, failures to publish, mistakes, and/or errors in the printing, publishing, display, broadcasting or other related provision of services in relation to the BP/BC Marketing Channels set forth in Section 2.3 , Section 2.5 and Section 2.6 shall not exceed, except for acts of gross negligence or willful misconduct, the costs actually reimbursed by the Advertiser to the Service Provider in accordance with this Agreement in connection with such acts, omissions, failures to publish, mistakes, and/or errors in the printing, publishing, display, broadcasting or other provision of services in relation to the BP/BC Marketing Channels giving rise to such liability. In addition to the foregoing, under no circumstances shall any party to this Agreement be liable to another for any special, incidental, indirect, consequential, lost future revenue, income or profits, diminution

of value or loss of business reputation or opportunity, punitive or similar damages in connection with this Agreement.

ARTICLE VII - MISCELLANEOUS

Section 7.1 GOVERNING LAW . THIS AGREEMENT SHALL BE GOVERNED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE WITHOUT REFERENCE TO ITS INTERNAL CONFLICTS OF LAWS PRINCIPLES.

Section 7.2 Submission to Jurisdiction . Each of the parties hereto irrevocably (A) agrees that any legal suit, action or proceeding arising out of or based upon this Agreement shall be instituted only in the Federal District Court for the Western District of Missouri, (B) waive, to the fullest extent it may effectively do so, any objection which it may now or hereafter have to venue of any such proceeding and (C) submit to the exclusive jurisdiction of such courts in any such suit, action or proceeding.

Section 7.3 Remedies .

(a) If a party hereto obtains a judgment against any other party by reason of breach of this Agreement, a reasonable attorneys’ fee as fixed by the court shall be included in such judgment. Any party hereto shall be entitled to maintain, on its own behalf, any action or proceeding against any other party hereto (including, any action for damages, specific performance, or declaratory relief) for or by reason of breach by such party of this Agreement; provided , however , the liability of any party for or by reason of breach by such party of this Agreement shall be limited as set forth herein.

(b) The remedies conferred upon the parties in this Agreement are intended to be exclusive of any other remedy herein or by law provided or permitted. No failure or delay on the part of a party to exercise any right it may have in the event of an act or omission giving rise to a claim hereunder shall prevent the exercise of such right by such party at any time the defaulting party continues to be so in default, and no such failure or delay shall operate as a waiver of any default. Each separate party to this Agreement shall be entitled to such rights and remedies, independent one from any other party hereto. Specifically, by way of example and not limitation, Bluegreen and the Company, upon default by any Service Provider shall, independently and severally, and subject to the limitations of liability set forth in this Agreement, be entitled to any and all damages permitted hereunder as against such Service Provider provable as a consequence thereof.

(c) No waiver by a party of any breach of this Agreement shall be deemed to be a waiver of any other breach of any kind or nature and no acceptance of payment or performance by a party after any such breach shall be deemed to be a waiver of any breach of this Agreement whether or not such party knows of such breach at the time it accepts such payment or performance.

(d) In the event of any dispute or disagreement between the parties, the party asserting the dispute shall give written notification of such dispute or disagreement to, if such party is a Service Provider or Tracker Marine, John M. Maloney, Jr., or the person then

performing the duties at Bluegreen currently performed by John M. Maloney, Jr., (“ Bluegreen CEO ”) and if such party is Bluegreen, acting as Bluegreen, Bluegreen Affiliates or the Company, to James A. Hagale or the person then performing the duties at Big Cedar currently performed by James A. Hagale (together with the Bluegreen CEO, the “ CEOs ”); and (iii) the CEOs shall communicate with each other promptly with a view to resolving such dispute or disagreement within ninety (90) days of commencing any negotiations (or such extended period as the CEOs agree is appropriate in any such case). The foregoing shall be a condition precedent to applicability of the remedies set forth in this Section 7.3 . During any period of such communications, all services prior to any claimed default shall continue without any alteration or modification, except as acceptable to the party receiving such services.

Section 7.4 Notice/Default . Notwithstanding any provision herein otherwise, no default of this Agreement shall be determined to exist until and unless any failure to observe or perform any provision of this Agreement continues for ninety (90) days after written notice thereof by a party hereunder to a party not so performing or observing, or if the violation is corrected with respect to future violations within ninety (90) days after written notice of such breach from the non-breaching party; provided, however, that if the nature of such failure is such that it cannot reasonably be cured within such ninety (90) day period, and such non-performing party, within the ninety (90) day period commences to cure, and thereafter diligently processes such cure to completion, such cure period shall be extended for a period of no more than sixty (60) days, and provided, further, this Section 7.4 shall not apply to Section 2.2 .

Section 7.5 Notices . All notices required or permitted by the terms hereof shall be given by hand delivery or by sent and paid Federal Express or other overnight delivery, at the following addresses or at such other addresses as either party hereto shall, in writing, advise the other:


	If to Bluegreen:		4960 Conference Way North, Suite 100 Boca Raton, Florida 33431 Attention: David Pontius, President

	With a copy to:		Bluegreen Corporation 4960 Conference Way North, Suite 100 Boca Raton, Florida 33431 Attention: General Counsel

			James J. Scavo, Esq. Weinstock & Scavo, P.C. 3405 Piedmont Road, N.E., Suite 300 Atlanta, Georgia 30305 e-mail address:

			Barry E. Somerstein, Esq. Ruden McClosky 200 East Broward Blvd P.O. Box 1900 Ft. Lauderdale, Florida 33301


If to a Service Provider or Tracker Marine:

		Big Cedar, L.L.C. 2500 East Kearney Street Springfield, Missouri 65898 Attn: General Counsel Attn: Toni M. Miller

With a copy to:		Latham & Watkins, L.L.P. 233 South Wacker Drive Chicago, IL 60606 Attn: Michael A. Pucker

If to the Company:		Bluegreen/Big Cedar Vacations, LLC Attention: John M. Maloney, Jr. President c/o Bluegreen Corporation 4960 Conference Way North, Suite 100 Boca Raton, Florida 33431 Attention: David Pontius, President

With a copy to:		Bluegreen Corporation 4960 Conference Way North, Suite 100 Boca Raton, Florida 33431 Attention: General Counsel

		Big Cedar, L.L.C. 2500 East Kearney Street Springfield, Missouri 65898 Attn: General Counsel Attn: Toni M. Miller

		James J. Scavo, Esq. Weinstock & Scavo, P.C. 3405 Piedmont Road, N.E. Suite 300 Atlanta, Georgia 30305

		Barry E. Somerstein, Esq. Ruden McClosky 200 East Broward Blvd P.O. Box 1900 Ft. Lauderdale, Florida 33301


		Latham & Watkins, L.L.P. 233 South Wacker Drive Chicago, IL 60606 Attn: Michael A. Pucker

All notices shall be deemed given at the time of hand delivery or the time such deposited with Federal Express or other reputable overnight delivery for transmittal as aforesaid; provided, however, that the time at which response or action in response to any notice must be given or taken shall run from the time of actual receipt of such notice.

Section 7.6 Assignment . No party to this Agreement may, without the prior consent of all of the parties not then in default hereunder, which consent may be withheld in such party’s sole discretion, transfer any rights or obligations under this Agreement, provided , however , any party may transfer its rights or obligations to an Affiliate of such party upon receipt of consent of all of the other parties, which consent shall not be unreasonably withheld.

Section 7.7 Confidentiality . The parties hereto, on behalf of themselves and their respective agents, employees and attorneys each hereby covenant and agree to keep confidential all information regarding this transaction and the advertising, marketing and promotional services to be provided hereunder (provided, however, that they may divulge such information as required and requested by lenders, investors and potential investors pursuant to an appropriate confidentiality agreement or other investors and potential investors related to receivable purchase transactions or governmental authorities, including within such releases or announcements as may be required by law, or by the rules or regulations of any securities exchange) and they shall keep confidential all information regarding projections concerning marketing and sale of the Timeshare Projects or any Bluegreen Timeshare Facility, development of the Timeshare Projects and methods of marketing and sale. All notices to third parties and all publicity or press releases with respect to the transaction contemplated hereby shall be mutually approved by the Company, Bluegreen, Big Cedar and Bass Pro prior to release or dissemination. Bluegreen shall present draft copies of all Bluegreen filings with the United States Securities and Exchange Commission that relate to this Agreement to Bass Pro at least three business days prior to such filing for review.

Section 7.8 Good Faith Cooperation, Negotiation, Operation and Performance . The parties hereby agree to cooperate, negotiate, operate, and perform in good faith to accomplish the intentions and fully effectuate the purposes of this Agreement, including but not limited to, in the creation, execution, and delivery of any document or service contemplated hereunder. Upon reasonable request, from time to time, the parties shall execute and deliver all documents and instruments and do all of the acts as may be reasonably necessary or desirable to give effect to the performance of this Agreement and all the services hereunder to be provided or to exercise by the other parties their respective rights hereunder. The Service Providers shall, for each license, right or easement specified in this Agreement deliver to the Advertisers appropriate documentation on a form acceptable to the Advertisers to identify such right in specific documentation.

Section 7.9 Severability . If any provision of this Agreement shall be held to be illegal, invalid or unenforceable, that provision will be enforced to the maximum extent permissible, so

as to effect the intent of the parties, and the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. If necessary to effect the intent of the parties, the parties will negotiate in good faith to amend this Agreement to replace the unenforceable language with the enforceable language which as closely as possible reflects such intent. The provisions of this Agreement to the benefit of Bluegreen are severable and distinct from the provision of this Agreement to the benefit of the Company, and shall be enforceable one independent from the other.

Section 7.10 Counterparts . This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement, and shall become effective when one or more counterparts shall have been signed by each party and delivered to each other party.

Section 7.11 Entire Agreement . This Agreement constitutes the entire agreement between the parties hereto as to the subject matter contained herein and supersedes all prior discussions, understandings, and agreements between them as to the subject matter contained herein, including, without limitation, the Original M&P Agreement and the agreements contemplated thereby. This Agreement may not be modified or amended unless such amendment is set forth in writing and signed by each party.

Section 7.12 Construction . This Agreement has been negotiated by the parties and their respective counsel, and shall be fairly interpreted in accordance within the terms, and without any strict construction in favor of or against any party. In construing this Agreement, the singular sense shall be deemed to include the plural, and the male and neuter gender shall mean and comprehend all genders, whenever such meaning or interpretation is necessary and appropriate. Headings contained in this Agreement are for reference purposes only, and shall not affect in any way the meaning or interpretation of this Agreement.

Section 7.13 No Condition Precedent . The obligations of the parties hereto shall be determined by the terms of this Agreement and shall not be subject to any other, additional or extraneous condition precedent occurring. By way of example and not limitation, the terms of this Agreement shall be binding amongst and between the parties hereto, despite any absence of agreement concerning construction, improvement or development of the Red Rock Bluff Timeshare Project.

Section 7.14 Time is of the Essence . Time is of the essence in the performance of this Agreement.

Section 7.15 Consideration . Service Providers acknowledge that certain promises of Advertisers herein run to the benefit of Service Providers and certain promises of Advertisers herein run to the benefit of Service Providers. In exchange for the foregoing, as well as in exchange for other good and valuable consideration, the receipt and sufficiency of which is acknowledged by Service Providers and Advertisers and each agrees that they are bound to this Agreement and to the performance of the obligations hereunder to the benefit of the other.

[signature pages follow]


		BLUEGREEN VACATIONS UNLIMITED, INC. , a Florida corporation

		By:

		Print Name:

		Title:


		BLUEGREEN/BIG CEDAR VACATIONS, LLC , a Delaware limited liability company:

		By:			Bluegreen Vacations Unlimited, Inc. a Florida corporation, its Managing Member

		By:

		Print Name:

		Title:

[Signature Page to Amended and Restated Marketing and Promotions Agreement]


		BIG CEDAR, L.L.C ., a Missouri limited liability company

		By:

		Toni M. Miller
		Authorized Signatory

		BASS PRO, INC. , a Delaware corporation

		By:

		Toni M. Miller
		Vice President, Chief Financial Officer, & Treasurer

		BASS PRO OUTDOORS ONLINE, L.L.C. , a Missouri limited liability company

		By:

		Toni M. Miller
		Authorized Signatory

		BASS PRO OUTDOOR WORLD, L.L.C. , a Missouri limited liability company

		By:

		Toni M. Miller
		Authorized Signatory

		BPS CATALOG, L.P. , a Missouri limited partnership

		By:

		Toni M. Miller
		Authorized Signatory

		BASS PRO TRADEMARKS, L.L.C. , a Missouri limited liability company

[Signature Page to Amended and Restated Marketing and Promotions Agreement]


		By:

		Toni M. Miller
		Authorized Signatory

		WORLD WIDE SPORTSMAN, INC. , a South Carolina Corporation

		By:

		Toni M. Miller
		Vice President, Chief Financial Officer and Treasurer

		BASS PRO SHOPS CANADA, INC. , an Ontario corporation

		By:

		Toni M. Miller
		Vice President, Chief Financial Officer & Treasurer

		BASS PRO SHOPS CANADA (CALGARY) , INC. , a Canada corporation

		By:

		Toni M. Miller
		Vice President, Chief Financial Officer & Treasurer

[Signature Page to Amended and Restated Marketing and Promotions Agreement]


		BPIP, LLC , a Virginia limited liability company

		By:

		Toni M. Miller
		Authorized Signatory

		TRACKER MARINE, L.L.C. , a Missouri limited liability company

		By:

		Toni M. Miller
		Authorized Signatory

[Signature Page to Amended and Restated Marketing and Promotions Agreement]

EXHIBIT “A-1”

BASS PRO TRADEMARKS, TRADE NAMES, SERVICE MARKS, PROPRIETARY
MARKS, LOGOS AND UNIQUE SIGNS

EXHIBIT “A-2”

BIG CEDAR TRADEMARKS, TRADE NAMES, SERVICE MARKS, PROPRIETARY
MARKS, LOGOS AND UNIQUE SIGNS

EXHIBIT “B-1”

BIG CEDAR TIMESHARE PROJECT PROPERTY DESCRIPTION

EXHIBIT “B-2”

RED ROCK BLUFF TIMESHARE PROJECT PROPERTY DESCRIPTION

EXHIBIT “C”

PROSPECT TRACT (TO BE REVISED WITHIN 30 DAYS)

Execution Copy

AMENDED AND RESTATED
ADMINISTRATIVE SERVICES AGREEMENT

THIS AMENDED AND RESTATED ADMINISTRATIVE SERVICES AGREEMENT (“ Agreement ”) dated as of the 31st day of December, 2007, is made by and among Bluegreen/Big Cedar Vacations, LLC, a Delaware limited liability company (the “ Company ”), Bluegreen Vacations Unlimited, Inc., a Florida corporation (“ Bluegreen ”), and Big Cedar, L.L.C., a Missouri limited liability company (“ Big Cedar ”). The Company, Bluegreen and Big Cedar are each referred to herein as a “ Party ”, and collectively as “ Parties .”

RECITALS:

WHEREAS , the Company and Bluegreen previously entered into that certain Administrative Services Agreement dated as of June 16, 2000 (the “ Original Administrative Services Agreement ”), which provided for an arrangement by which Bluegreen provided certain general and administrative services relating to the Big Cedar Timeshare Project on the terms set forth therein; and

WHEREAS , the Company and Bluegreen now desire to amend and restate the Original Administrative Services Agreement in its entirety on the terms and conditions set forth herein.

NOW, THEREFORE , for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and the mutual promises contained herein, the Original Administrative Services Agreement is hereby amended by striking said Original Administrative Services Agreement in its entirety and substituting therefore the following Amended and Restated Administrative Services Agreement:

1. Definitions .

(a) Annual Sales Volume shall mean the annual gross sales of timeshare interests in the Timeshare Projects, less purchaser cancellation and defaults, determined quarterly.

(b) Big Cedar Timeshare Project shall mean that certain timeshare project developed by the Company known as the Wilderness Club at Big Cedar and located contiguous to the Big Cedar Lodge in Ridgedale, Taney County, Missouri, including that portion of the Big Cedar Timeshare Project known as “Building 3000,” which timeshare project is located on that certain property described on Exhibit “B” to the Operating Agreement and incorporated herein by this reference.

(c) Operating Agreement shall mean that certain Amended and Restated Operating Agreement of Bluegreen/Big Cedar Vacations, LLC, dated as of the date hereof, by and among Bluegreen and Big Cedar.

(d) Red Rock Bluff Timeshare Project shall mean that certain timeshare project to be developed by the Company, located in Taney County, Missouri, which timeshare project shall be located on that certain property described on Exhibit “C” attached to the Operating Agreement and incorporated herein by this reference.

(e) Servicing Agreement shall mean that certain Amended and Restated Servicing Agreement, dated as of the date hereof, by and among Bluegreen Corporation, the Company, and Big Cedar.

(f) Timeshare Projects shall mean collectively the Big Cedar Timeshare Project and the Red Rock Bluff Timeshare Project, together with such other timeshare projects as may be owned, developed and sold by the Company from time to time.

2. Services to be Provided . In consideration of the Fee set forth in Section 5 , Bluegreen agrees to perform the following services for the benefit of the Company:

(a) Hiring, firing and setting compensation for the Company’s employees and managers in accordance with the Company’s approved Annual Budget (as defined in the Operating Agreement), excepting the General Manager who shall be employed in accordance with the Operating Agreement.

(b) Performing business functions of the Company as respects the use of internal accounting, management information, human resources and other back-office services.

(d) Providing and/or coordinating for the centralized accounting, financing, legal, human resource, management information services, budget preparation and management.

3. Exception from Services . Bluegreen shall not be responsible for providing, and the Fee shall not be deemed to be compensation for, any services provided by Bluegreen Corporation, an affiliate of Bluegreen, for collecting or servicing purchaser notes, which is the subject of the Servicing Agreement.

4. Outside/Third Party Services . All fees, costs and expenses payable to third parties incurred by or on behalf of the Company for outside services, as opposed to in-house services necessary to provide the foregoing services including, by way of example and not limitation, legal, accounting and audit fees, employee benefits, technological and similar services, and all other mutually agreed-upon expenses as may be provided from time to time for the benefit of the Company, shall be at the full cost and expense of the Company (collectively, the “ Permitted Company Expenses ”). All of the foregoing Permitted Company Expenses shall be directly paid by the Company or, if paid by Bluegreen, reimbursed by the Company, as applicable. Bluegreen may elect to use its available in-house staff to perform some or all of the foregoing services when reasonably appropriate, provided , that Bluegreen shall first obtain approval of Big Cedar and that such services performed by Bluegreen in-house staff shall be at rates at least as favorable to the Company as those available from unaffiliated parties.

5. Fee . For the performance of the services hereunder, the Company shall pay to Bluegreen or Bluegreen Corporation (as Bluegreen may determine in its sole discretion), a fee (“ Fee ”) equal to three percent (3%) of the Annual Sales Volume of the Company, determined quarterly. The Fee shall be due and payable in arrears on the last day of each fiscal quarter, and the Company shall make such payment in full no later than twenty (20) days after such date. At such time, in addition to payment of the Fee, the Company shall reimburse Bluegreen within thirty (30) days of the Company’s receipt of an invoice for the Permitted Company Expenses incurred by Bluegreen as set forth in Section 4 .

6. No Reimbursement of Bluegreen Expenses . Notwithstanding the Permitted Company Expenses provided by Section 4 of this Agreement, Bluegreen shall not be entitled to receive payment of or reimbursement for any of its general and administrative fees, overhead, costs or expenses incurred on behalf of the Company relating to the Timeshare Projects including, without limitation, expenses incurred

by Bluegreen representatives for travel to the Timeshare Projects in Missouri for the purpose of providing services for this Agreement or other related expenses.

7. Breach . In the event of breach of this Agreement by any Party, each Party shall be entitled to all remedies at law or in equity available, including remedies for collection of amounts due, or for equitable relief, including any decree of specific performance of the terms of this Agreement. Under no circumstances shall any Party be liable to another for any special, incidental, indirect, consequential, lost future revenue, income or profits, diminution of value or loss of business reputation or opportunity, punitive or similar damages in connection with this Agreement.

8. Dispute Resolution Procedure . In the event of any dispute or disagreement between the Parties hereunder, either party may give written notification of such dispute or disagreement to the others. If such party giving notice is the Company or Big Cedar, then the notice shall be given to John M. Maloney, Jr., or the person then performing the duties at Bluegreen currently performed by John M. Maloney, Jr. (“ Bluegreen CEO ”), and if such party giving notice is Bluegreen, then notice shall be given to James A. Hagale or the person performing the duties at the Company currently performed by James A. Hagale (collectively with the Bluegreen CEO, the “ CEOs ”). The CEOs shall communicate with each other promptly upon any notice, with a view to resolving this dispute or disagreement within ninety (90) days of commencing any negotiations (or such extended periods as the CEOs agree is appropriate in any such case). The foregoing shall be a condition precedent to the applicability of the breach section as provided in Section 7 , hereinabove. During any period of such communications, all services prior to any claimed breach shall continue without any alteration or modification, except as acceptable to the party receiving such services.

9. Employment-Related Indemnity and Insurance . In addition to the indemnity set forth in Section 11 , Bluegreen agrees to save and hold harmless, to defend and indemnify, the Company against all actions, proceedings, claims, demands, losses, outlays, damages or expenses, including legal fees of any nature and character as may arise or be made against the Company as a result of Bluegreen’s actions on behalf of the Company as set forth in Section 2(a) . During the term of this Agreement, Bluegreen shall maintain, at its sole cost and expense, employment practices liability insurance in such amounts, and with such limits and deductibles as shall be commercially reasonable; subject, however, to Bluegreen’s right to receive reimbursement from the Company for such costs and expenses as a Permitted Company Expense pursuant to Section 4 . Bluegreen shall provide the Company with certificates of insurance on an annual basis verifying the insurance required in this Section 9 , and all such policies shall name the Company as an additional insured thereunder and shall waive all rights of subrogation against the Company.

10. Indemnification by the Company . The Company agrees to save and hold harmless, to defend and indemnify, Bluegreen against all actions, proceedings, claims, demands, losses, outlays, damages or expenses, including legal fees of any nature and character as may arise or be made against Bluegreen as a result of the Company’s violation of laws, breach of this Agreement, gross negligence or willful acts or omissions in acting in relation to this Agreement, or which Bluegreen may in any way incur in defending or prosecuting, settling or discontinuing any such proceeding, action, claim, damage, expense or outlay. Notwithstanding the foregoing, in no event shall the Company be obligated to indemnify Bluegreen from any actions, proceedings, claims, demands, losses, outlays, damages or expenses resulting from Bluegreen’s fraud, bad faith, dishonesty, violation of Laws, willful misconduct, gross negligence or breach of the express terms of this Agreement.

11. Indemnification by Bluegreen . In addition to the indemnity set forth in Section 9 , Bluegreen agrees to save and hold harmless, to defend and indemnify, the Company against all actions,

proceedings, claims, demands, losses, outlays, damages or expenses, including legal fees of any nature and character as may arise or be made against the Company as a result of Bluegreen’s violation of laws, breach of this Agreement, gross negligence or willful acts or omissions in acting in relation to this Agreement, or which the Company may in any way incur in defending or prosecuting, settling or discontinuing any such proceeding, action, claim, damage, expense or outlay. Notwithstanding the foregoing, in no event shall Bluegreen be obligated to indemnify the Company from any actions, proceedings, claims, demands, losses, outlays, damages or expenses resulting from the Company’s fraud, bad faith, dishonesty, violation of Laws, willful misconduct, gross negligence or breach of the express terms of this Agreement.

12. Notices . Any notice or other document to be given hereunder by any Party to any other Party shall be in writing and delivered by courier or by telecopy transmission or sent by any express mail service, postage or fees prepaid:


	If to Bluegreen:		Bluegreen Corporation
			4960 Conference Way North, Suite 100
			Boca Raton, Florida 33431
			Attn: Mr. John M. Maloney, Jr., President

	With a copy to:		Weinstock & Scavo, P.C.
			3405 Piedmont Road, N.E., Suite 300
			Atlanta, Georgia 30305
			(404) 231-3999
			(404) 231-1618
			Attn: James J Scavo, Esq.

	If to the Company:		Bluegreen Corporation
			4960 Conference Way North, Suite 100
			Boca Raton, Florida 33431
			Attn: Mr. John M. Maloney, Jr., President

	With a copy to:		Weinstock & Scavo, P.C.
			3405 Piedmont Road, N.E., Suite 300
			Atlanta, Georgia 30305
			(404) 231-3999
			(404) 231-1618
			Attn: James J Scavo, Esq.

			and

			Big Cedar, L.L.C.
			2500 East Kearney Street
			Springfield, Missouri 65898
			Tel: (417) 339-5100
			Fax: (417) 334-3956
			Attn: General Counsel
			Attn: Toni M. Miller

	With a copy to:		Latham & Watkins, L.L.P.
			233 South Whacker Drive
			Chicago, IL 60606
			Tel: (312) 876-6520
			Fax: (312) 993-6767
			Attn: Michael A. Pucker, Esq.

Or at such other address or number for a Party as shall be specified by like notice. Any notice which is delivered in the manner provided herein shall be deemed to have been duly given to the Party to whom it is directed upon actual receipt by such Party or its agent.

13. Parties Bound by Agreement . The terms, conditions and obligations of this Agreement shall inure to the benefit of and be binding upon the Parties and their respective successors and assigns. Without the prior written consent of the other party, no Party may assign such Party’s rights, duties or obligations hereunder or any part thereof to any other person or entity.

14. Number; Gender . Whenever the context so requires, the singular number shall include the plural and the plural shall include the singular, and the gender of any pronoun shall include the other genders.

15. Headings . The headings of the sections of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction hereof.

16. Modification and Waiver . Any of the terms or conditions of this Agreement may be waived in writing at any time by the party which is entitled to the benefits thereof. No waiver of any of the provisions of this Agreement shall be deemed to or shall constitute a waiver of any other provision hereof.

17. Construction . This Agreement shall be construed in accordance with and governed by the laws of the State of Missouri, exclusive of conflicts of laws principles. No provision of this Agreement shall be construed against or interpreted to the disadvantage of any party hereto by any court or other governmental or judicial authority or by any board of arbitrators by reason of such party or its counsel having or being deemed to have structured or drafted such provision. Unless otherwise expressly provided herein, all references in this Agreement to Section(s) shall refer to the Section(s) of this Agreement. Time is of the essence in the performance of this Agreement.

18. No Limitation . The Parties agree that the rights and remedies of any Party under this Agreement shall not operate to limit any other rights and remedies otherwise available to any Party under the Operating Agreement or otherwise.

19. Severability . Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction will, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions of this Agreement, and any such prohibition or unenforceability in any jurisdiction will not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by law, the Parties waive any provision of law which renders any such provision prohibited or unenforceable in any respect.

20. Term . The term of this Agreement shall commence on the date hereof and continue for seven (7) years thereafter, and shall, unless terminated by either of the Parties hereto, automatically renew for additional one (1) year periods; it being agreed that any Party desiring to terminate this Agreement at the end of the initial or any extension term shall provide not less than one hundred twenty (120) days prior written notice of such termination to the other Party.

[Signatures follow on next page]

IN WITNESS WHEREOF , the Parties hereto have caused this Agreement to be executed as of the date first above written.



	BLUEGREEN/BIG CEDAR VACATIONS, LLC, a
	Delaware limited liability Company

	By:	Bluegreen Vacations Unlimited, Inc., a Florida
	Corporation

	By:
	Please Print Name:
	Its:

	BLUEGREEN VACATIONS UNLIMITED, INC.,
	a Florida Corporation

	By:
	Please Print Name:
	Its:

	Solely for the purposes of the rights set forth in
	Section 4:

	BIG CEDAR, L.L.C., a Missouri limited
	liability company

	By:
		Toni M. Miller
		Authorized Signatory

Execution Copy

AMENDED AND RESTATED
SERVICING AGREEMENT

THIS AMENDED AND RESTATED SERVICING AGREEMENT (“Agreement”) is effective as of the 31st day of December, of 2007, and is made and entered into by and among BLUEGREEN CORPORATION, a Massachusetts corporation (“ Servicer ”), BLUEGREEN/BIG CEDAR VACATIONS, LLC, a Delaware limited liability company (the “ Company ”) and Big Cedar, L.L.C., a Missouri limited liability company (“ Big Cedar ”).

WITNESSETH

WHEREAS, Servicer, the Company, and Big Cedar previously entered into that certain Servicing Agreement dated as of June 16, 2000 (the “ Original Servicing Agreement ”), which provided for an arrangement by which Servicer provided servicing of timeshare receivables, specifically in respect to promissory notes, purchase documents and related deeds of trust received by the Company from certain purchasers of timeshare interests at the Big Cedar Timeshare Project, on the terms set forth therein; and

WHEREAS, Servicer, the Company, and Big Cedar now desire to amend and restate the Original Servicing Agreement in its entirety on the terms and conditions set forth herein.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and the mutual promises contained herein, the Original Servicing Agreement is hereby amended by striking said Original Servicing Agreement in its entirety and substituting therefore the following Amended and Restated Servicing Agreement:

1. Definitions .

(a) Big Cedar Timeshare Project shall mean that certain timeshare project developed by the Company known as the Wilderness Club at Big Cedar and located contiguous to the Big Cedar Lodge in Ridgedale, Taney County, Missouri, including that portion of the Big Cedar Timeshare Project known as the “Building 3000 Project,” which timeshare project is located on that certain property described on Exhibit “B” to the Operating Agreement and incorporated herein by this reference.

(b) Contracts shall mean collectively all promissory notes, purchase documents and related deeds of trust received by the Company from certain purchasers of timeshare interests at the Timeshare Projects secured by timeshare interest(s) at the Timeshare Project(s).

(c) Operating Agreement shall mean that certain Amended and Restated Operating Agreement of Bluegreen/Big Cedar Vacations, LLC, dated as of the date hereof, by and between Bluegreen Vacations Unlimited, Inc. (“ Bluegreen Vacations ”), an affiliate of Servicer, and Big Cedar.

(e) Timeshare Projects shall mean collectively the Big Cedar Timeshare Project and the Red Rock Bluff Timeshare Project, together with such other timeshare projects as may be owned, developed and sold by the Company from time to time.


2.	Application . This Agreement shall apply to all Contracts received from purchasers of timeshare interests at the Timeshare Projects secured by timeshare interest(s) at the Timeshare Project(s).

3.	Appointment of Servicer as an Independent Contractor . The Company hereby appoints Servicer as an independent contractor to collect, for the account of the Company, all periodic and other payments under the Contracts. Servicer hereby accepts such appointment and agrees to act in accordance with the terms hereof. Servicer shall have only the authority that is expressly conferred upon it by this Agreement.

4.	Lockbox Bank . The Servicer has engaged and shall engage the services of Bank of America, N.A. (the “ Lockbox Bank ”) that will govern the terms of the Account (as defined below), such Lockbox Bank having been deemed to be acceptable to the Company. The Servicer has entered and will enter into agreements with the Lockbox Bank (the “ Lockbox Agreement ”) setting forth the obligations of the Lockbox Bank described in this Agreement, which prior agreements contain no terms or conditions that conflict with the terms and conditions of this Agreement and have been deemed to be reasonably acceptable to the Company and any such future agreements shall likewise contain no terms or conditions that conflict with the terms and conditions of this Agreement and shall be shall be reasonably acceptable to the Company.

5.	Payments.


	(a)	Collection of Payments . With respect to all Contracts serviced under this Agreement, Servicer covenants and agrees that during the entire term of this Agreement, Servicer will seek, at its sole cost and expense, to collect promptly all payments due under the Contracts.

	(b)	Authorization to accept Payments . Servicer is only authorized to accept payments as provided in the Contracts or as required by law.

	(c)	Default under Contract . Subject to any reinstatement of the defaulted Contracts as may take place, Servicer shall, on behalf of and at the direction of the Company, in case of default of any of the Contracts, take reasonable and customary actions to forfeit or cancel the rights of the obligor(s) under such Contracts, or institute or assist in instituting, possessory, forfeiture, foreclosure or other proceedings to acquire or terminate the rights of the obligor(s) in and to the


		timeshare interest; such actions of the Servicer in so proceeding to be at the total cost and expense of the Company.

	(d)	Post Office Box. Servicer agrees that it shall establish through the Lockbox Bank a post office box depository to which payments by obligors under the Contracts may be made. Such post office box shall be opened in the name of the Company/Servicer (or if required by a hypothecation lender to the Company, then Servicer may open the lockbox in the name determined by such hypothecation lender). Each obligor, as applicable, will be, as soon as possible after the date of this Agreement, and thereafter periodically as determined by Servicer, instructed to mail their remittances under the Contracts to the above described post office box. The Company agrees to take all steps necessary or, in Servicer’s opinion, desirable to cause the applicable obligors under the Contracts to mail their remittances to the post office box.

	(e)	Receipt of Payments. On the day received, the Lockbox Bank will open all mail addressed to the post office box referred to herein and remove and inspect enclosures. All Checks (as defined below) and other collection remittances and all return items will be processed by the Lockbox Bank according to the terms hereof and of the Lockbox Agreement.

	(f)	PAC Arrangements. If payors of Contracts are offered the opportunity to pay such Contracts by electronic funds transfer, pre-authorized checking (“ PAC ”) arrangements or credit card payments, then Servicer shall process such payments through the appropriate accounts as opposed to processing by check collection. Such payments shall, otherwise, be subject to the terms hereof.


6.	Bluegreen/Big Cedar Vacations, LLC Contracts Account.


	(a)	Deposit of Payments . All money orders, checks, drafts and other orders of payment (“ Checks ”) respecting payment on Contracts, and all money and other funds (“ Monies ”) (including electronic fund transfer, PACs, credit card payments or similar arrangements) respecting payment on Contracts received by Servicer or the Lockbox Bank, in accordance with its usual and customary procedures, will be deposited by Servicer or the Lockbox Bank into the appropriate account at the Lockbox Bank maintained in the name of “Bluegreen/Big Cedar Vacations, LLC” or a related variation thereof (hereinafter the “ Accounts ”), it being recognized as of the date of this Agreement that there are a total of three (3) such Accounts. In addition to Servicer’s or Lockbox Bank’s deposit of all Checks and Monies received by it or in the post office box, respectively, to the Accounts, the Company agrees that it will make or cause the obligors under the respective Contracts who are unable or unwilling to remit payments due to the post office box or by electronic fund transfer, PAC arrangements or credit card payments, to instead pay the Company directly or by way of transfers to an account of the Company, which the Company shall then deposit into the applicable Account. Charges respecting the Accounts or the post office box and any other charges, costs or fees incurred pursuant to this Agreement will be billed to and paid


		directly by the Company, and Servicer will not be liable for any such charges, costs or fees. Servicer may deduct from the foregoing payments its Fee, pursuant to Paragraph 7, and costs as set forth in Paragraph 5(c) and the preceding sentence (if Servicer pays such charges, costs or fees on behalf of the Company), provided, that the Servicer shall only be permitted to make such deductions if the Company has not timely paid such amounts as provided in Section 7 . The Accounts have been and/or shall be opened as interest-bearing accounts, if possible, and all such interest shall accrue to the benefit of the Company. If an interest-bearing account is not possible, Servicer shall seek to have amounts in the Accounts, as applicable, swept into to an interest-bearing account on a daily or other periodic and routine basis no less frequently than three times per week, which interest shall accrue to the benefit of the Company, or swept directly to an account as directed by any hypothecation lender.

	(b)	Monies to be held in Trust . All Checks and Monies received by Servicer are to be segregated from all other funds of Servicer and shall be held in trust for the Company until deposited. All Checks and Monies received by Servicer and/or deposited into the Accounts are the property of the Company, and Servicer will have no interest in or control over the Checks and Monies, excepting for its rights set forth in Paragraph 6(a) and its obligations set forth herein, as applicable.

	(c)	Withdrawals. Withdrawals from the Accounts are restricted, and may be made only by way of draft, wire transfer or electronic funds transfer payable to the Company or pursuant to Paragraph 6(a). To the extent that a hypothecation lender does not otherwise direct, Servicer will arrange to wire transfer to the Company all collected funds received in the applicable Account to the Company’s account number 2020000449306 at Wachovia Bank in Boca Raton, Florida, bank transit number 063000021, reference Bluegreen/Big Cedar Vacations, LLC, or as may otherwise be specifically directed by the Company. The Servicer shall seek to set up an automated repetitive wire agreement (daily or other periodic and routine basis not less frequently than three times per week) in respect to the foregoing transfers, subject to the terms of this Agreement.

	(d)	Acceptable Payee. Servicer or Lockbox Bank will deposit into the applicable Account all Checks on which the payee or endorsee is the Company or a reasonable variation of the Company’s name (“ Acceptable Payee ”). Servicer or Lockbox Bank has the right, in its sole discretion, to determine what a reasonable variation of Acceptable Payee is. If the payee is not an Acceptable Payee, Servicer or Lockbox Bank will not deposit the Check in the Account and the Check will be referred to the Servicer. The Company agrees to indemnify and hold Servicer harmless from and against all losses, costs, attorney’s fees, claims or suits suffered by Servicer arising out of, or in connection with, its depositing Checks payable to or endorsed in favor of Acceptable Payees, except to the extent such damages and losses are as a result of Servicer’s violation of laws, breach of this Agreement, bad faith, gross negligence or willful acts or omissions.


	(e)	Payments received by the Company. The Company shall cause all payments on Contracts to be made to the applicable Account, and any payment on Contracts which are received by the Company shall be delivered by the Company to Servicer within two (2) business days after receipt thereof.

	(f)	Accounting . Within fifteen (15) days after the end of each calendar month during the term of this Agreement, Servicer shall deliver to the Company:


	(i)	a statement showing the then-current balance of the Accounts and all deposits into and withdrawals from the Accounts, including all deductions made by Servicer for its Fee and costs incurred by Servicer on behalf of the Company as set forth in Paragraphs 5(c) and 6(a) , during the immediately preceding calendar month.

	(ii)	a trial balance on each of the Contracts including the payments received (if any), delinquency status, and a complete breakdown of the payment record as to principal and interest and the outstanding principal balance of each Contract;

	(iii)	an aging report on each of the Contracts;

	(iv)	a collection report on each of the Contracts;

	(v)	a report on the status of the Contracts, including new sales, forfeitures, foreclosures and cancellations; and

	(vi)	a true, correct and complete list of all Contracts, including the names and addresses of the related customers, which Servicer received in the immediately preceding month.

(g)	Check Deposit Requirements. Subject to any reasonable requirements of the Lockbox Bank and legal requirements, Servicer will and will cause the Lockbox Bank to agree to abide by the following requirements and limitations when depositing Checks in the Account:

	(i)	In the absence of a Check date, Lockbox Bank will insert the current date with the date stamp and process the check as provided in this Agreement. Lockbox Bank will not deposit Checks postdated three (3) or more days, or Checks with dates six (6) months or older.

	(ii)	If a Check’s written and numerical amounts differ, Lockbox Bank will credit the account respecting such Contract for the written amount.

	(iii)	If the drawer’s signature is missing or the Check contains no indication of drawer, Lockbox Bank will not deposit the Check. Otherwise, Servicer will deposit the Check and affix a stamp impression requesting the drawee bank to contact drawer for authority to pay.


		(iv)	Lockbox Bank will attempt to identify and segregate altered Checks and Checks bearing restrictive notations, such as “ payment in full ,” “ balance on account ,” or “ final settlement .” All Checks so identified will not be deposited; provided, however, Lockbox Bank will have no liability to any person, including the Company, should it process and deposit an altered Check or a Check bearing any such restrictive notation.

		(v)	Checks drawn in foreign currency will be referred to Servicer.

		(vi)	Prior to deposit, Lockbox Bank will endorse Checks “ Credited to the Account of Within Named Payee, Absence of Endorsement Guaranteed .”

		(vii)	Checks deposited in the Accounts, which are returned unpaid because of “ insufficient funds ,” “ uncollected funds ,” or similar reasons, will be redeposited once by Lockbox Bank. If redeposit is not warranted for reasons such as “ account closed ,” or “ payment stopped” or if a Check is returned a second time or there are any other charges or debits resulting from returned or otherwise dishonored Checks, such amounts will be debited from the Account.

		(viii)	All deposited Checks must be scanned by Lockbox Bank. Lockbox Bank will retain such scanned records for four (4) years.

		(ix)	No services concerning the Accounts will be provided on any bank holiday prescribed by the Federal Reserve district in which the Account is located.


7.	Servicing Fee. The Company shall be liable for the payment of a monthly servicing fee (the “ Fee ”) to Servicer in the amount of one-twelfth (1/12) of two percent (2%) of the outstanding principal balance at the beginning of the servicing period (the Servicer’s calendar month) of the Contracts. Except as provided in Paragraphs 5(c) and 6(a) , the Company shall have no responsibility or liability for any payment of fees or expenses other than the Fee. The Servicer shall invoice the Company for the Fee and any reimbursable expenses on the last day of each month, which amounts shall be paid by the Company to the Servicer within fifteen (15) days after receipt of such invoices. If the Fee and any reimbursable expenses are not timely paid after invoice for the same, Servicer shall be entitled to deduct from funds of the Company in its possession pursuant to this Agreement the Fee and reimbursable costs. Servicer shall have all rights, whether statutory, common law or contractual, to set off any past-due indebtedness of the Company to Servicer arising pursuant to this Agreement against any of the funds of the Company that, pursuant to this Agreement, it may have in its possession from time to time.


8.	Obligation to provide Notice.

	(a)	Notice upon sale, transfer or assignment . Servicer will notify the Company of any information received by Servicer of the sale, transfer or assignment of any timeshare interest, together with the date of the instrument or order transferring title to the timeshare interest respecting any Contract serviced by Servicer.

	(b)	Notice upon condemnation or eminent domain proceedings . Servicer will promptly report and forward to the Company any notices or pleadings received in connection with any condemnation or eminent domain proceeding affecting any timeshare interest respecting any Contract. Servicer shall also advise the Company as to the extent of taking and its effect on such property and shall give its recommendation as to action with respect to such proceedings.


9.	Unauthorized acts of Servicer . Except as otherwise provided herein, Servicer is not authorized or empowered to waive or vary the terms of any of the Contracts in any material way, and will not at any time waive or consent to the postponement of strict compliance on the part of any obligor with respect to any material term, provision or covenant of any Contract, nor grant, in any other manner, indulgence with respect to any such material term, provision or covenant, without the express written approval of the Company, or an authorized representative of the Company.

10.	Servicer as an Affiliate of a Member of the Company . It is recognized and agreed that Servicer is an affiliate of Bluegreen Vacations, which is a member of the Company, and that in no way shall the terms of this Agreement be deemed to limit or restrict the rights of Bluegreen Vacations as a member of the Company. The Company waives any conflict of interest as may exist between Servicer, in its capacity as Servicer, and Servicer, as an affiliate of Bluegreen Vacations, in its capacity as a member of the Company.

11.	Indemnification by the Company. The Company agrees to save and hold harmless, to defend and to indemnify, Servicer against all actions, proceedings, claims, demands, losses, outlays, damages or expenses, including reasonable legal fees, of any nature and character as may arise or be made against Servicer as a result of Servicer’s acting in relation to this Agreement, or which Servicer may in any way incur in defending or prosecuting, settling or discontinuing any such proceeding, action, claim, damage, expense or outlay. Notwithstanding the foregoing, in no event shall the Company be obligated to indemnify Servicer from any actions, proceedings, claims, demands, losses, outlays, damages or expenses resulting from Servicer’s fraud, bad faith, dishonesty, violation of Laws, willful misconduct, gross negligence or breach of the express terms of this Agreement.

12.	Indemnification by the Servicer. Servicer agrees to save and hold harmless, to defend and indemnify, the Company against all actions, proceedings, claims, demands, losses, outlays, damages or expenses, including reasonable legal fees of any nature and character as may arise or be made against the Company as a result of Servicer’s or Lockbox Bank’s violation of laws, breach of this Agreement, bad faith, gross negligence or willful acts or omissions in acting in relation to this Agreement or the Lockbox Agreement, or which the Company may in any way incur in defending or prosecuting,


	settling or discontinuing any such proceeding, action, claim, damage, expense or outlay. Notwithstanding the foregoing, in no event shall Servicer be obligated to indemnify the Company from any actions, proceedings, claims, demands, losses, outlays, damages or expenses resulting from the Company’s fraud, bad faith, dishonesty, violation of Laws, willful misconduct, gross negligence or breach of the express terms of this Agreement.

13.	Audit of Servicer’s Books and Records . Servicer agrees that, during and subsequent to the term of this Agreement, representatives or agents of the Company may, at any time during ordinary business hours, but not more than twice in any one calendar year (or more frequently if Servicer breaches its obligations hereunder), and without unreasonable interference with the day-to-day operations of Servicer, examine, audit and make copies of all books, records and documents maintained by Servicer relating to the Contracts. Servicer agrees to maintain all such books, records and documents, including computer tapes, disks and hard copies of all such computer data, in readable form necessary to access and process such data, where they are maintained at the inception of the terms hereof, for a period of four (4) years following termination of this Agreement.

14.	Term. The term of this Agreement shall commence on the date it is executed and delivered by the parties, and shall continue until all Contracts are fully paid; provided, however, that this Agreement may be terminated at any time by Big Cedar in the event of an uncured material breach of this Agreement, provable fraud, bad faith, gross negligence or willful misconduct of Servicer or by mutual agreement by both the Company and Servicer. Servicer shall deliver to the Company (or any subsequent servicer) all existing books, records and documents, including computer readable memory as may be maintained by Servicer for the continued servicing of the Contracts after any termination of this Agreement. Servicer agrees that such books and records relating to any Contracts shall, following termination of this Agreement, be delivered to the Company, provided, however, the Company agrees that Servicer shall have the right to maintain copies of such books and records for its own account.

15.	Custody of Contracts and related documents. Custody of the originals of all Contracts and executed instruments related thereto shall be delivered into the custody of Servicer to hold for and on behalf of the Company in accordance with the terms hereof; provided, however, that, to the extent required to perfect any security interest therein, the same may be delivered to an acquiror or pledgee thereof, pursuant to the terms of any applicable sale, hypothecation or loan agreement or documents related thereto, including but not limited to any applicable custodial agreement. Servicer agrees to hold such instruments delivered to Servicer subject to the terms hereof, or otherwise subject to the terms of the aforereferenced documents.

16.	Duty of Care. Servicer will exercise the same degree of care, and will give the same attention of performance of the obligations pursuant to this Agreement in a manner consistent with the level of skill and care as reasonably may be required in performance of services to be provided hereunder. Servicer shall not be liable for consequential or incidental damages resulting from the inaccuracy of any information furnished to the Company or any errors or mistakes in reports prepared by Servicer, except for those


	caused by the gross negligence or willful misconduct of Servicer, its employees or independent contractors.

17.	Security Interest . So long as any amounts are due by the Company to Servicer, the Company hereby grants to Servicer a security interest and lien on the Account and all proceeds thereof to the extent of such amounts.

18.	Assignment. Servicer may assign its rights and delegate the performance of its duties under this Agreement, in part or in full to any other corporation or entity controlled by, controlling or under the common control with Servicer, so long as Servicer remains primarily liable for its obligations under this Agreement and such assignee is able to perform in the same manner as Servicer. The respective rights and duties of the Company under this Agreement may not be assigned nor delegated.

19.	Modification . This Agreement represents the entire agreement with respect to the servicing of Contracts and supersedes all prior agreements related thereto, including without limitation, the Original Servicing Agreement. This Agreement may not be changed or terminated orally and no modification, termination or attempted waiver shall be valid unless in writing and signed by all parties or in the case of waiver, signed by the party who is waiving such action or inaction.

20.	Counterparts . This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and all of which taken together shall constitute one agreement.

21.	Remedies. If a party hereto obtains a judgment against any other party by reason of breach of this Agreement, a reasonable attorneys’ fee as fixed by the court shall be included in such judgment. Any party hereto shall be entitled to maintain, on its own behalf, any action or proceeding against any other party hereto (including, any action for damages, specific performance, or declaratory relief) for or by reason of breach by such party of this Agreement; provided , however , the liability of any party for or by reason of breach by such party of this Agreement shall be limited as set forth herein.

22.	Limitation of Liability . Except as expressly provided in this Agreement, no party to this Agreement shall be liable to another for any special, incidental, indirect, consequential, lost future revenue, income or profits, diminution of value or loss of business reputation or opportunity, punitive or similar damages in connection with this Agreement.

23.	Execution of Additional Documents . The Company and Servicer agree to execute and deliver to each other, from time to time, any additional instruments and documents necessary or desirable to effectuate, finalize, record or perfect the transactions contemplated under this Agreement.

24.	Notices . Any notice or communication required or permitted to be given hereunder shall be in writing, addressed to the respective party as set forth below, or such different address as any party may, from time to time, give notice of, in accordance with the

provisions of this Paragraph 24 , and may be personally served, telecopied or sent by overnight courier or U.S. mail, and shall be deemed given: (a) if served in person, when served; (b) if telecopied, on the date of transmission if before 3:00 p.m. Boca Raton, Florida time (any notice received after such time shall be deemed received on the next business day), provided that a hard copy of such notice is also sent pursuant to clause (c) or (d); (c) if by overnight courier, on the first business day after delivery by the courier; or (d) if by U.S. mail, on the fourth day after deposit in the mail, postage prepaid, certified mail, return receipt requested.


	If to Servicer:		Bluegreen Corporation
			4960 Conference Way North, Suite 300
			Boca Raton, Florida 33431
			Attn: Mr. David Pontius, President

	With a copy to:		Weinstock & Scavo, P.C.
			3405 Piedmont Road, N.E.
			Suite 300
			Atlanta, Georgia 30305
			(404) 231-3999
			(404) 231-1618
			Attn: James J Scavo, Esq.

	If to the Company:		Bluegreen/Big Cedar Vacations, LLC
			C/o Bluegreen Corporation
			4960 Conference Way North, Suite 300
			Boca Raton, Florida 33431
			Attn: Mr. David Pontius, President

	If to Big Cedar:		Big Cedar, L.L.C.
			2500 East Kearney Street
			Springfield, Missouri 65898
			Tel: (417) 339-5100
			Fax: (417) 334-3956
			Attn: General Counsel
			Attn: Toni M. Miller

	With a copy to:		Latham & Watkins, L.L.P.
			233 South Wacker Drive
			Chicago, IL 60606
			Tel: (312) 876-6520
			Fax: (312) 993-6767
			Attn: Michael A. Pucker


25.	Benefit. This Agreement shall bind and inure to the benefit of Servicer and the Company, and to their respective successors and permitted assignees.


26.	Interpretation . This Agreement shall be governed by, interpreted and enforced in accordance with the laws of the State of Missouri.

27.	Force Majeure . Servicer shall not be liable to the Company nor be deemed to have defaulted under or breached this Agreement for failure or delay in fulfilling or performing any term of the Agreement, provided such failure or delay is caused by or results from a Force Majeure. As used herein, “ Force Majeure ” shall mean any event that is beyond the reasonable control of and not the fault of Servicer, including without limitation, acts of God or nature, acts of public enemy, civil or military conflicts, labor disturbances, communications line failure and acts or inactions of a governmental authority. Notwithstanding the foregoing, this Paragraph 27 does not limit a party’s right to terminate this Agreement under Paragraph 14.

[Signature Page Follows]

IN WITNESS WHEREOF the parties hereto have executed and delivered this Agreement as of the date first written above.


	SERVICER:

	BLUEGREEN CORPORATION,
	a Massachusetts corporation

	By:

	Print Name:

	Title:


	COMPANY:

	BLUEGREEN/BIG CEDAR VACATIONS, LLC,
	a Delaware limited liability company

	By:

	Print Name:

	Title:


	Solely for the purposes of the rights set forth in
	Paragraph 14:

	BIG CEDAR, L.L.C., a Missouri limited
	liability company

	By:

		Toni M. Miller
		Authorized Signatory

EXHIBIT 21.1

Bluegreen Corporation Subsidiaries

Big Cedar JV Interiors, LLC

Bluegreen Asset Management Corporation

Bluegreen/Big Cedar Vacations, LLC

Bluegreen Carolina Lands, LLC

Bluegreen Communities of Georgia, LLC

Bluegreen Communities of Georgia Realty, Inc.

Bluegreen Communities of Houston – I, LLC

Bluegreen Communities of Texas, LP

Bluegreen Corporation of Tennessee

Bluegreen Corporation of the Rockies

Bluegreen Golf Clubs, Inc.

Bluegreen Guaranty Corporation

Bluegreen Holding Corporation (Texas)

Bluegreen Interiors, LLC

Bluegreen Louisiana, LLC

Bluegreen Nevada, LLC

Bluegreen New Jersey, LLC

Bluegreen Properties N.V.

Bluegreen Properties of Virginia, Inc.

Bluegreen Purchasing & Design, Inc.

Bluegreen Receivables Finance Corporation III

Bluegreen Receivables Finance Corporation V

Bluegreen Receivables Finance Corporation VI

Bluegreen Receivables Finance Corporation VII

Bluegreen Receivables Finance Corporation VIII

Bluegreen Receivables Finance Corporation IX

Bluegreen Receivables Finance Corporation X

Bluegreen Receivables Finance Corporation XI

Bluegreen Receivables Finance Corporation XII

Bluegreen Resorts International, Inc.

Bluegreen Resorts of Canada, Inc.

Bluegreen Resorts Management, Inc.

Bluegreen Southwest Land, Inc.

Bluegreen Southwest One, LP

Bluegreen Table Rock, LLC

Bluegreen Timeshare Finance Corporation I

Bluegreen Vacations Unlimited, Inc.

Bluegreen West Corporation

BRF Corporation 2007-A

BRFC III Deed Corporation

Brickshire Realty, Inc.

BXG Acquisition Corp.

BXG Construction, LLC

BXG Realty, Inc.

BXG Realty Tenn, Inc.

Carolina National Golf Club, Inc.

Catawba Falls, LLC

Encore Rewards, Inc.

Family Fun Company, LLC

Great Vacation Destinations, Inc.

Jordan Lake Preserve Corporation

Lake Ridge Realty, Inc.

Leisure Capital Corporation

Leisure Communication Network, Inc.

Leisurepath, Inc.

Managed Assets Corporation

BXG Mineral Holdings, LLC

Mountain Lakes Realty, Inc.

126

Mystic Shores Realty, Inc.

New England Advertising Corporation

Pinnacle Vacations, Inc.

Preserve at Jordan Lake Realty, Inc.

Resort Title Agency, Inc.

SC HOLDCO, LLC

Select Connections, LLC

Texas Hill Country Realty, Inc.

Travelheads, Inc.

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EXHIBIT 23.1

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the following registration statements of Bluegreen Corporation and in the related Prospectuses of our reports dated February 26, 2008, with respect to the consolidated financial statements of Bluegreen Corporation and the effectiveness of internal control over financial reporting of Bluegreen Corporation included in this Annual Report (Form 10-K) for the year ended December 31, 2007.


	1)	Registration Statement (Form S-8 No. 333-127114) pertaining to Bluegreen Corporation’s 2005 Stock Incentive Plan,

	2)	Registration Statement (Form S-8 No. 33-61687) pertaining to Bluegreen Corporation’s 1988 Outside Directors Stock Option Plan and 1995 Stock Incentive Plan, and

	3)	Registration Statement (Form S-8 No. 333-64659) pertaining to Bluegreen Corporation’s 1998 Non-Employee Directors Stock Option Plan, Amended and Restated 1995 Stock Incentive Plan and Retirement Savings Plan.


	/s/ Ernst & Young LLP
	Certified Public Accountants

West Palm Beach, Florida
February 26, 2008

128

EXHIBIT 31.1

Rule 13a-14(a)/15d-14(a) Certification

I, John M. Maloney, Jr., certify that:


	1.	I have reviewed this annual report on Form 10-K of Bluegreen Corporation;

	2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

	3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

	4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


		a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

		b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

		c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

		d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


	5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


		a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

		b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 3, 2008

/S/ JOHN M. MALONEY, JR.

John M. Maloney, Jr.

Chief Executive Officer

129

EXHIBIT 31.2

Rule 13a-14(a)/15d-14(a) Certification

I, Anthony M. Puleo, certify that:


	1.	I have reviewed this annual report on Form 10-K of Bluegreen Corporation;

	2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

	3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

	4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


		a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

		b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

		c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

		d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


	5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


		a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

		b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 3, 2008

/S/ ANTHONY M. PULEO

Anthony M. Puleo

Chief Financial Officer

130

EXHIBIT 32.1

Certification Required by 18 U.S.C. Section 1350
(as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002)

I, John M. Maloney, Jr., as Chief Executive Officer of Bluegreen Corporation (the “Company”), certify, pursuant to 18 U.S.C. Section 1350 (as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002), that:


	(1)	the accompanying Annual Report on Form 10-K of the Company for the year ended December 31, 2007 (the “Report”), filed with the U.S. Securities and Exchange Commission, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

	(2)	the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


	By:	/S/ JOHN M. MALONEY, JR.

		John M. Maloney, Jr.
		Chief Executive Officer

Date: March 3, 2008

The foregoing certification is being furnished solely pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code) and is not being filed as part of the Form 10-K or as a separate disclosure document.

A signed original of this written statement required by Section 906 has been provided to Bluegreen Corporation and will be retained by Bluegreen Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

131

EXHIBIT 32.2

Certification Required by 18 U.S.C. Section 1350
(as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002)

I, Anthony M. Puleo, as Chief Financial Officer of Bluegreen Corporation (the “Company”), certify, pursuant to 18 U.S.C. Section 1350 (as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002), that:


	(1)	the accompanying Annual Report on Form 10-K of the Company for the year ended December 31, 2007 (the “Report”), filed with the U.S. Securities and Exchange Commission, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

	(2)	the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


	By:	/S/ ANTHONY M. PULEO

		Anthony M. Puleo
		Senior Vice President,
		Chief Financial Officer and Treasurer

Date: March 3, 2008

132