First Modification to the Second Mortgage



 




Exhibit 10(u)





This instrument was prepared by and is to be returned to Benton D. Williamson,
whose address is Haynsworth Sinkler Boyd, P.A., P.O. Box 11889, Columbia, South
Carolina 29211-1889.


FIRST MODIFICATION

TO THE

SECOND MORTGAGE MODIFICATION AND RE-STATEMENT AGREEMENT

(“Agreement”)



(Book 410, Page 540)





	 	 
	STATE OF SOUTH CAROLINA	)
	 	)
	COUNTY OF BEAUFORT	)




               THIS FIRST MODIFICATION TO THE SECOND MORTGAGE MODIFICATION AND
RE-STATEMENT AGREEMENT (the “Agreement”) is made as of the 31st day of July,
2003 by and among WACHOVIA BANK, NATIONAL ASSOCIATION (formerly known as
WACHOVIA BANK, N.A., WACHOVIA BANK OF SOUTH CAROLINA, N.A. and THE SOUTH
CAROLINA NATIONAL BANK) (the “Mortgagee”), whose address is P.O. Box 700,
Charleston, South Carolina 29401, Attention: Real Estate Lending, and SEA PINES
ASSOCIATES, INC. and SEA PINES COMPANY, INC. (collectively, the “Mortgagor”).



WITNESSETH:



               WHEREAS, the Mortgagor and Mortgagee have entered into that certain
Amended and Restated Master Credit Agreement dated October 31, 2002 pursuant to
which the Mortgagor and Mortgagee have established uniform agreements,
obligations, covenants and other matters governing the Obligations, as defined
in said Agreement, whether now existing or hereinafter arising, owed to the
Mortgagee (the “Amended and Restated Master Credit Agreement”); and



               WHEREAS, the Mortgagor and Mortgagee have entered into that certain First
Modification and Waiver Agreement of even date herewith (“First Modification”)
pursuant to which the Mortgagee and Mortgagor have agreed to make certain
modifications to the Amended and Restated Master Credit Agreement and to waive
certain existing Events of Default thereunder; and



               WHEREAS, to partially secure the Notes and Mortgagor’s Obligations arising
in connection with the Amended and Restated Master Credit Agreement, the
Mortgagor executed and delivered to the Mortgagee that certain Mortgage,
Security Agreement and Financing Statement dated November 17, 1987, as amended
from time to time, and recorded in the RMC Office or Clerk of Court, as
appropriate, for Beaufort County in Book 410, Page 540, made a part hereof by
this reference as fully as if set out herein verbatim (such document, as
heretofore amended, being referred to as the “Mortgage”); and



               WHEREAS, the Mortgagee, as holder and owner of the Mortgage, and the
Mortgagor mutually desire to modify and amend the provisions of the same in the
manner hereinafter set out, it being specifically understood that except as
herein modified and amended, the terms and provisions of the Mortgage shall

remain unchanged and continue in full force and effect as therein written.



               NOW, THEREFORE, the Mortgagee and the Mortgagor, in consideration of the
sum of One Dollar ($1.00) and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged and the mutual
covenants herein contained do hereby agree that the Mortgage should be, and the
same hereby is modified and amended as follows:



 






 


               1. The provisions of the Documents (including the Notes and the Amended
and Restated Master Credit Agreement, as amended by the First Modification (the
“Credit Agreement”)) are incorporated in the Mortgage as fully as if set out
therein verbatim.



               2. Notwithstanding anything to the contrary contained in the Notes and
Mortgage, and any amendments thereto, the Mortgage is hereby amended to include
as a Note and an Obligation, in each case as defined in the Credit Agreement,
that certain Judgment Note of even date herewith evidencing an indebtedness not
exceeding EIGHT MILLION DOLLARS ($8,000,000.00).



               3. Any reference contained in the Mortgage, as amended herein, to a “Note”
or the “Notes” shall hereinafter be deemed to be a reference to a “Note” or the
“Notes” as defined in the Credit Agreement.



               4. The final payment of the Judgment Note shall be the Judgment Note
Maturity Date as defined in the Credit Agreement.



               IT IS MUTUALLY AGREED by and between the parties hereto that this
Agreement shall become a part of the Mortgage by reference and that nothing
herein contained shall (i) impair the security now held for the indebtedness
represented by the Notes, (ii) waive, annul, vary or affect any provision,
condition, covenant or agreement contained in the Notes and the Mortgage except
as herein amended, or (iii) affect or impair any rights, powers or remedies
under the Notes and the Mortgage as hereby amended. Furthermore, the Mortgagee
does hereby reserve all rights and remedies it may have as against all parties
who may be or may hereafter become primarily or secondarily liable for the
repayment of the indebtedness evidenced by the Notes.



               The execution and delivery hereof shall not constitute a novation or
modification of the lien, encumbrance or security title of the Mortgage, which
Mortgage shall retain its priority as originally filed for record. Mortgagor
expressly agrees that the Mortgage remains in full force and effect and that
Mortgagor has no right to setoff, counterclaim or defense to the lien granted
thereby.



               This Agreement shall be governed by and construed in accordance with the
laws of the State of South Carolina without regard to principles of conflict of
laws.



               Any reference contained in the Notes, the Documents or the Mortgage, as
amended herein, to the Mortgage shall hereinafter be deemed to be a reference
to such document as amended hereby. In amplification thereof, the Mortgage, as
amended hereby, shall secure the Obligations including, without limitation, the
Notes, and any further modifications, renewals or extensions thereof.



               This Agreement shall be binding upon and inure to the benefit of any
assignee or the respective successors and assigns of the parties hereto.



               This Agreement may be executed in any number of counterparts, each of
which shall be an original but all of which taken together shall constitute one
and the same instrument, and any of the parties hereto may execute any of such
counterparts.



               All capitalized terms used but not defined herein shall have the meanings
assigned thereto in the Credit Agreement.



[Signature Page Follows.]



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          IN WITNESS WHEREOF, this instrument has been executed under seal by the
parties hereto and delivered on the date and year first above written.



	 	 	 	 	 
	 	 	MORTGAGEE:
	 	 	 	 	 
	 	 	WACHOVIA BANK, NATIONAL ASSOCIATION
	 	 	 	 	 
	SIGNED, SEALED AND DELIVERED

IN THE PRESENCE OF:	 	
By:
	 	/s/ Timothy S. Blake


        Its: Vice-President






(Witness)




(Witness)


	 	 	 	 	 
	 	 	MORTGAGOR:
	 	 	 	 	 
	

(Witness)	 	SEA PINES ASSOCIATES, INC.
	 	 	 	 	 
	 	 	
By:
	 	/s/ Michael E. Lawrence
	 	 	 	 	

	

(Witness)	 	 	 	     Its: Chief Executive Officer
	 	 	 	 	          
            (CORPORATE SEAL)
	 	 	 	 	 
	

(Witness)	 	SEA PINES COMPANY, INC.
	 	 	 	 	 
	 	 	
By:
	 	/s/ Steven P. Birdwell
	 	 	 	 	

	

(Witness)	 	 	 	     Its: Chief Financial Officer
	 	 	 	 	          
            (CORPORATE SEAL)


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	STATE OF SOUTH CAROLINA	)
	 	)
	COUNTY OF BEAUFORT	)




          The foregoing instrument was acknowledged before me this 31st day of July,
2003 by Michael E. Lawrence, a Chief Executive Officer of Sea Pines Associates,
Inc., a South Carolina corporation, on behalf of said entity.




	 
	/s/ Jean C. Goethe
	

	Notary Public for South Carolina
	My Commission Expires: April 16, 2006






	 	 
	STATE OF SOUTH CAROLINA	)
	 	)
	COUNTY OF BEAUFORT	)



          The foregoing instrument was acknowledged before me this 31st day of July,
2003 by Timothy Blake, a Vice President of Wachovia Bank, National Association,
on behalf of said entity.




	 
	/s/ Elisabeth Peavy
	

	Notary Public for South Carolina
	My Commission Expires: June 24, 2006






	 	 
	STATE OF SOUTH CAROLINA	)
	 	)
	COUNTY OF BEAUFORT	)




          The foregoing instrument was acknowledged before me this 31st day of July,
2003 by Steven P. Birdwell, a Chief Financial Officer of Sea Pines Company,
Inc., a South Carolina corporation, on behalf of said entity.




	 
	/s/ Jean C. Goethe
	

	Notary Public for South Carolina
	My Commission Expires: April 16, 2006




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