<PAGE>
 
                                                                   EXHIBIT 10.35





================================================================================


                              EXECUTION ORIGINAL
                              ------------------


                                    Colonial Charters Golf Course
                                    Longs
                                    Horry County
                                    South Carolina





                                  L E A S E



                  NATIONAL GOLF OPERATING PARTNERSHIP, L.P.

                                   Landlord


                                     and


                            THE LINKS GROUP, INC.

                                    Tenant


                          Dated as of July 11, 1996






================================================================================
<PAGE>
 
                                                Colonial Charters Country Club
                                                Longs
                                                Horry County
                                                State of South Carolina

                                     LEASE
                                     -----

          THIS LEASE ("Lease"), dated for reference purposes only July 11, 1996,
                       -----
is entered into by and between NATIONAL GOLF OPERATING PARTNERSHIP, L.P., a 
Delaware limited partnership ("Landlord"), and THE LINKS GROUP, INC., a Delaware
                               --------
corporation ("Tenant"). This Lease consists of the Basic Lease Provisions, the 
              ------
Detailed Lease Provisions and Exhibits A through E, all of which are 
                              --------------------
incorporated herein by this reference. Capitalized terms used herein have the 
meanings assigned to such terms in Exhibit A.
                                   ----------



                            BASIC LEASE PROVISIONS

1.   Facility: Means the Leased Property consisting of an 18-hold golf course, 
     clubhouse, driving range and related facilities located on the Land.

2.   Commencement Date:  Means July 11, 1996.

3.   Term:  Approximately twenty years, commencing on the Commencement Date and 
     ending on December 31, 2016.

4.   Initial Base Rent:  Means $478,068.

5.   Fiscal Year: Means the 12-month period from January 1 through December 31,
     of each year of the Term, or the applicable portions of the first and last
     Fiscal Years.

6.   Annual Base Rent:  Means, with respect to the Fiscal Year commencing on the
     Commencement Date, the Initial Base Rent. On January 1, 1997, and on
     January 1 of each following Fiscal Year through and including January 1,
     2006, the Annual Base Rent shall be equal to the Annual Base Rent
     applicable to the immediately preceding Fiscal Year multiplied by the
     annual percentage increase in the Consumer Price Index ("CPI") from the
                                                              ---
     immediately preceding Fiscal Year; provided, however, the CPI increase in
     Annual Base Rent for any Fiscal Year pursuant to the terms of this Section
                                                                        -------
     6 shall not exceed five percent per annum. The Annual Base Rent for the
     -
     Fiscal Year commencing on January 1, 2007, and continuing for each Fiscal
     Year for the balance of the Term of this Lease shall be the amount of the
     Annual Base Rent for Fiscal Year ending December 31, 2006, with no CPI
     increase.



                                      -i-




<PAGE>
 
7.     Applicable Percentage:

           With respect to Course Revenue, means:

                For the first and second  Fiscal Years: 36%
                For the third and fourth Fiscal Years:  37%
                For the fifth Fiscal Year and for each Fiscal Year
                throughout the Term:  38%

           With respect to Other Revenue, means 8% for each Fiscal Year 
           throughout the Term.

8.     Additional Rent: Means the amount, if any, by which (a) the sum of:

           (i) all Course Revenue for any Fiscal Year multiplied by the
           Applicable Percentage of Course Revenue; plus

           (ii) all Other Revenue for any Fiscal Year multiplied by the 
           Applicable Percentage of Other Revenue

       exceeds (b) the Annual Base Rent for such Fiscal Year. (See Section 3.3 
                                                                   ----------- 
       of the Detailed Lease Provisions.)

9.     Address for Payments:

                Landlord:

                     National Golf Operating Partnership, L.P.
                     c/o National Golf Properties, Inc.
                     1448 15th Street, Suite 200
                     Santa Monica, California 90404

       (See Section 3.1 of the Detailed Lease Provisions.)
            -----------

10.    Addresses for Notices:

                Tenant:

                     The Links Group
                     5001 North Kings Highway
                     Suite 203
                     Myrtle Beach, South Carolina 29577
                     Attention:  Kenneth L. Folkes
                                 President

                     with a copy to:

                     The Links Group
                     5001 North Kings Highway
                     Suite 203
                     Myrtle Beach, South Carolina 29577
                     Attention:  Controller



                                     -ii-


<PAGE>
 
               Landlord:

                    National Golf Operating Partnership, L.P.
                    c/o National Golf Properties, Inc.
                    1448 15th Street, Suite 200
                    Santa Monica, California  90404
                    Attn:  Scott S. Thompson, Esq.
                           General Counsel

     (See Section 26.8 of the Detailed Lease Provisions.)
          ------------

11.  Within 45 days after the end of each Fiscal Year of the Term, Tenant
     shall fund the capital Improvement Account by an amount calculated as 2%
     of the Total Revenue for such Fiscal Year. Tenant hereby grants to
     Landlord a security interest in the Capital Improvement Account. Tenant
     shall keep the Capital Improvement Account and all funds therein separate
     from Tenant's other accounts and funds. Tenant and Landlord shall enter
     into a separate agreement between themselves and the depository bank to
     effectuate such security interest. Tenant may submit an annual detailed
     budget for capital improvements (collectively, "Capital Expenditures") it
                                                     --------------------
     proposes to make to the Leased Property, which budget will be subject to
     approval by Landlord not to be unreasonably withheld or delayed (the
     "Approved Cap Ex Budget"). The Approved Cap Ex Budget shall set forth
      ----------------------
     maximum line item allowances for each project category within the Approved
     Cap Ex Budget (each, a "Line Item Allowance"). Tenant shall use funds from
                             -------------------
     the Capital Improvement Account only to fund Capital Expenditures to the
     Facility. Tenant may withdraw funds from Capital Improvement Account only:
     (i) to the extent consistent with the Approved Cap Ex Budget and within
     110% of the amount specified in each Line Item Allowance or (ii) as
     otherwise approved in writing by Landlord, which approval shall not to be
     unreasonably withheld or delayed. Tenant shall provide Landlord with such
     information as Landlord may reasonably request to confirm the application
     of funds as provided in this Section 11. Tenant shall cause all amounts
                                  ----------
     in the Capital Improvement Account to be expended prior to the expiration
     of the Term or the earlier termination of this Lease. Tenant shall pay to
     Landlord any unused amounts remaining in the Capital Improvement Account
     upon the expiration of the Term or earlier termination of this Lease.

12.  Reference is made to that certain Purchase and Sale Agreement and Joint

     Escrow Instructions dated as of May 9, 1996 (the "Purchase Agreement") by
                                                       ------------------
     and between Landlord (as Buyer thereunder) and Golf Enterprises, Inc., a
     South Carolina corporation ("Seller"). Landlord agrees, upon request of
                                  ------
     Tenant, to use reasonable efforts to enforce on Tenant's behalf the
     indemnities, covenants, representations and warranties made by Seller in
     favor of Landlord under the Purchase Agreement.


                                    -iii-
<PAGE>
 
13.    Title Commitment: Shall mean that certain Title Insurance Commitment No.
       C-16650 issued by Investors Title Insurance Company ("Title Company") in
       connection with Landlord's purchase of the Leased Property from Seller.

               IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease 
as of the date first above written.


NATIONAL GOLF OPERATING                     THE LINKS GROUP, INC.,
PARTNERSHIP, L.P.,                          a Delaware corporation
a Delaware limited partnership

By:  NATIONAL GOLF PROPERTIES, INC.,
     a Maryland corporation,
     Its General Partner




     By:     /s/   Richard C. Price         By:    /s/    Kenneth L. Folkes
        ------------------------------         -------------------------------

     Its:        President                  Its:          President
         -----------------------------          ------------------------------
                 "Landlord"                                "Tenant"


LIST OF ATTACHMENTS AND EXHIBITS:
--------------------------------

Detailed Lease Provisions

Exhibit A      Defined Terms; Interpretation

Exhibit B      Legal Description of the Land

Exhibit C      Other Lease Properties

Exhibit D      Operating Standards

Exhibit E      Landlord's Personal Property







                                     -iv-




<PAGE>
 
                           DETAILED LEASE PROVISIONS

                               TABLE OF CONTENTS
                               -----------------
                                                                         Page
                                                                         ----
ARTICLE 1 - LEASED PROPERTY ..........................................    -1-

ARTICLE 2 - TERM .....................................................    -1-
----------------

ARTICLE 3 - RENT .....................................................    -1-
---------------- 
     3.1    Rent .....................................................    -1-
            ----
     3.2    Base Rent ................................................    -2-
            ---------
     3.3    Additional Rent ..........................................    -2-
            ---------------
     3.4    Additional Charges .......................................    -3-
            ------------------
     3.5    Late Payment of Rent .....................................    -4-
            --------------------
     3.6    Net Lease ................................................    -4-
            ---------
     3.7    Marketing Programs .......................................    -4-
            ------------------
     3.8    Income/Expense Prorations ................................    -5-
            -------------------------

ARTICLE 4 - IMPOSITIONS ..............................................    -5-
     4.1    Payment of Impositions ...................................    -5-
            ----------------------
     4.2    Information and Reporting ................................    -5-
            -------------------------
     4.3    Assessment Challenges ....................................    -6-
            ---------------------
     4.4    Prorations ...............................................    -6-
            ----------
     4.5    Refunds ..................................................    -6-
            -------
     4.6    Utility Charges ..........................................    -6-
            ---------------
     4.7    Reassessments Upon Transfer ..............................    -6-
            ---------------------------
     4.8    Assessment Districts .....................................    -7-
            --------------------

ARTICLE 5 - TENANT WAIVERS ...........................................    -7-
     5.1    No Termination, Abatement, Etc. ..........................    -7-
            ------------------------------
     5.2    Condition of the Leased Property .........................    -8-
            --------------------------------

ARTICLE 6 - OWNERSHIP OF PROPERTY ....................................    -9-
     6.1    Leased Property ..........................................    -9-
            ---------------
     6.2    Landlord's Personal Property .............................    -9-
            ----------------------------
     6.3    Tenant's Personal Property ...............................    -9-
            --------------------------
     6.4    Purchase of Tenant's Personal Property ...................   -10-
            --------------------------------------
     6.5    Removal of Personal Property .............................   -10-
            ----------------------------
     6.6    Landlord's Waivers .......................................   -11-
            ------------------
     6.7    Water Rights .............................................   -11-
            ------------
     6.8    Liquor License ...........................................   -12-
            --------------

ARTICLE 7 - USE OF LEASED PROPERTY...................................    -12-
     7.1    Use ......................................................   -12-
            ---
     7.2    Specific Prohibited Uses .................................   -12-
            ------------------------

ARTICLE 8 - HAZARDOUS MATERIALS.......................................   -13-
     8.1    Remediation ..............................................   -13-
            -----------
     8.2    Tenant's Indemnification of Landlord .....................   -13-
            ------------------------------------
     8.3    Landlord's Indemnification of Tenant .....................   -14-
            ------------------------------------
     8.4    Survival of Indemnification Obligations ..................   -14-
            ---------------------------------------




                                       i



<PAGE>
 
                                                                         Page
                                                                         ----
     8.5    Environmental Violations at Expiration or Termination
            -----------------------------------------------------
            of Lease .................................................   -14-
            --------

ARTICLE 9 - MAINTENANCE AND REPAIR ...................................   -15-
     9.1    Tenant's Sole Obligation .................................   -15-
            ------------------------
     9.2    Waiver of Statutory Obligations ..........................   -15-
            -------------------------------
     9.3    Mechanic's Liens .........................................   -16-
            ----------------
     9.4    Surrender of Leased Property .............................   -16-
            ----------------------------

ARTICLE 10 - TENANT'S IMPROVEMENTS ...................................   -16-
    10.1    Tenant's Right to Construct ..............................   -16-
            ---------------------------
    10.2    Scope of Right ...........................................   -16-
            --------------
    10.3    Cooperation of Landlord ..................................   -17-
            -----------------------
    10.4    Commencement of Construction .............................   -17-
            ----------------------------
    10.5    Rights in Tenant Improvements ............................   -18-
            -----------------------------

ARTICLE 11 - LIENS, ENCROACHMENTS AND OTHER TITLE MATTERS ............   -18-
    11.1    Liens ....................................................   -18-
            -----
    11.2    Encroachments and Other Title Matters ....................   -19-
            -------------------------------------
    
ARTICLE 12 - PERMITTED CONTESTS ......................................   -20-

ARTICLE 13 - INSURANCE ...............................................   -21-
    13.1    General Insurance Requirements ...........................   -21-
            ------------------------------
    13.2    Replacement Cost .........................................   -22-
            ----------------
    13.3    Waiver of Subrogation ....................................   -22-
            ---------------------
    13.4    Form Satisfactory, Etc. ..................................   -22-
            -----------------------
    13.5    Change in Limits .........................................   -23-
            ----------------
    13.6    Blanket Policy ...........................................   -23-
            --------------

ARTICLE 14 - APPLICATION OF INSURANCE PROCEEDS .......................   -24-
    14.1    Insurance Proceeds .......................................   -24-
            ------------------
    14.2    Reconstruction Covered by Insurance ......................   -25-
            -----------------------------------
    14.3    Reconstruction Not Covered by Insurance ..................   -27-
            ---------------------------------------
    14.4    Waiver ...................................................   -28-
            ------
    14.5    Damage Near End of Term ..................................   -28-
            -----------------------

ARTICLE 15 - CONDEMNATION ............................................   -28-
    15.1    Total Taking .............................................   -28-
            ------------
    15.2    Partial Taking ...........................................   -28-
            --------------
    15.3    Restoration ..............................................   -28-
            -----------
    15.4    Award-Distribution .......................................   -28-
            ------------------
    15.5    Temporary Taking .........................................   -29-
            ----------------
    
ARTICLE 16 - EVENTS OF DEFAULT........................................   -29-
    16.1    Events of Default ........................................   -29-
            -----------------
    16.2    Payment of Costs .........................................   -31-
            ----------------
    16.3    Exceptions ...............................................   -31-
            ----------
    16.4    Certain Remedies .........................................   -31-
            ----------------
    16.5    Damages ..................................................   -32-
            -------
    16.6    Additional Remedies ......................................   -33-
            -------------------
    16.7    Appointment of Receiver ..................................   -33-
            -----------------------


                                      ii
<PAGE>
 
                                                                         Page
                                                                         ----
    16.8    Application of Funds .....................................   -33-
            --------------------
    16.9    Impounds .................................................   -33-
            --------
    16.10   Breach by Landlord .......................................   -34-
            ------------------

ARTICLE 17 - LANDLORD'S RIGHT TO CURE TENANT'S DEFAULT ...............   -34-

ARTICLE 18 - LEGAL REQUIREMENTS ......................................   -34-

ARTICLE 19 - HOLDING OVER ............................................   -34-

ARTICLE 20 - RISK OF LOSS ............................................   -35-
    21.1    Tenant's Indemnification of Landlord .....................   -35-
            ------------------------------------
    21.2    Landlord's Indemnification of Tenant .....................   -36-
            ------------------------------------
    21.3    Mechanics of Indemnification .............................   -36-
            ----------------------------
    21.4    Survival of Indemnification Obligations ..................   -36-
            ---------------------------------------

ARTICLE 22 - SUBLETTING AND ASSIGNMENT ...............................   -37-
    22.1    Prohibition Against Subletting and Assignment ............   -37-
            ---------------------------------------------
    22.2    Changes of Control .......................................   -37-
            ------------------
    22.3    Subleases ................................................   -38-
            ---------
    22.4    Assignment ...............................................   -39-
            ----------
    22.5    REIT Limitations .........................................   -39-
            ----------------
    22.6    Leasehold Mortgages ......................................   -40-
            -------------------
              (a)  Mortgage Consent ..................................   -40-
                   ----------------
              (b)  Notices to Mortgagee ..............................   -40-
                   --------------------
              (c)  Insurance .........................................   -40-
                   ---------
              (d)  New Lease .........................................   -40-
                   ---------

ARTICLE 23 - OFFICER'S CERTIFICATES AND OTHER STATEMENTS ..............   -42-
    23.1    Officer's Certificates ...................................   -42-
            ----------------------
    23.2    Annual Financial Statements of Tenant ....................   -42-
            -------------------------------------
    23.3    Quarterly Financial Statements of Tenant .................   -43-
            ----------------------------------------
    23.4    Monthly Course Statements ................................   -43-
            -------------------------
    23.5    Annual Course Statements .................................   -44-
            ------------------------
    23.6    Budgets ..................................................   -44-
            -------
    23.7    Environmental Statements .................................   -44-
            ------------------------
    23.8    Confidentiality ..........................................   -44-
            ---------------

ARTICLE 24 - LANDLORD MORTGAGES .......................................   -45-
    24.1    Landlord May Grant Liens .................................   -45-
            ------------------------
    24.2    Tenant's Non-Disturbance Rights ..........................   -45-
            -------------------------------
    24.3    Facility Mortgage Protection .............................   -45-
            ----------------------------

ARTICLE 25 - FINANCIAL COVENANTS .....................................   -46-
    25.1    Financial Covenants ......................................   -46-
            -------------------
    25.2    Provision of Letter of Credit .............................   -46-
            ----------------------------
    25.3    Terms of Letter of Credit ................................   -46-
            -------------------------
    25.4    Draws Against Letter of Credit; Application of Proceeds...   -47-
            -------------------------------------------------------
    25.5    Renewal of Letter of Credit ..............................   -47-
            ---------------------------
    25.6    Liquidated Damages .......................................   -47-
            ------------------


                                      iii




    

<PAGE>
 
                                                                         Page
                                                                         ----
ARTICLE 26 - MISCELLANEOUS ...........................................   -47-
    26.1    Landlord's Right to Inspect ..............................   -47-
            ---------------------------
    26.2    No Waiver ................................................   -48-
            ---------
    26.3    Remedies Cumulative ......................................   -48-
            -------------------
    26.4    Acceptance of Surrender ..................................   -48-
            -----------------------
    26.5    No Merger of Title .......................................   -48-
            ------------------
    26.6    Conveyance by Landlord....................................   -48-
            ----------------------
    26.7    Quiet Enjoyment...........................................   -48-
            ---------------
    26.8    Notices...................................................   -49-
            -------
    26.9    Survival of Claims........................................   -49-
            ------------------
    26.10   Invalidity of Terms or Provisions.........................   -49-
            ---------------------------------
    26.11   Prohibition Against Usury.................................   -49-
            -------------------------
    26.12   Amendments to Lease.......................................   -49-
            -------------------
    26.13   Successors and Assigns....................................   -49-
            ----------------------
    26.14   Titles....................................................   -49-
            ------
    26.15   Governing Law.............................................   -49-
            -------------
    26.16   Memorandum of Lease.......................................   -49-
            -------------------
    26.17   Attorneys' Fees...........................................   -49-
            ---------------
    26.18   Non-Recourse as to Landlord...............................   -50-
            ---------------------------
    26.19   No Relationship...........................................   -50-
            ---------------
    26.20   Signs; Reletting..........................................   -50-
            ----------------
    26.21   Golf Course Name..........................................   -50-
            ----------------













                                      iv
    



    

<PAGE>
 
                          DETAILED LEASE PROVISIONS

                         ARTICLE 1 - LEASED PROPERTY
                         ---------------------------

         Upon and subject to the terms and conditions set forth in this Lease,
Landlord leases to Tenant and Tenant rents from Landlord all of Landlord's
rights and interest in and to the following real property, improvements
and related rights (collectively the "Leased Property"):
                                      ---------------

         (a)  the land described in Exhibit B attached hereto (collectively,
                                    ---------
         the "Land");
              ----

         (b)  all buildings, structures, Fixtures and other improvements of
         every kind including, but not limited to, alleyways and connecting
         tunnels, sidewalks, utility pipes, conduits and lines (on site and off
         site), parking areas, driving ranges, roadways, cart paths, bridges,
         lakes, irrigation systems, and course markers presently situated upon
         the Land, but not including any Tenant Improvements (collectively, the
                   -----------------
         "Leased Improvements");
          -------------------

         (c)  all easements, rights and appurtenances relating to the Land and
         the Leased Improvements (collectively, the "Related Rights"); and
                                                     --------------

         (d)  all personal property, if any, owned by Landlord and located on
         the Leased Property, which personal property is described in Exhibit E
                                                                      ---------
         attached hereto, but not including any (i) pro shop inventories,
                          -----------------
         (ii) food and beverage consumables, or (iii) copies of books and
         records related to the Leased Property ("Landlord's Personal
                                                  -------------------
         Property").
         --------

         (e)  any other property conveyed to Landlord pursuant to the terms
         of the Purchase Agreement, including, but not limited to, all
         property, included in the term "Property" as defined therein.

         Upon the Commencement Date, Landlord shall deliver exclusive
possession of the Leased Property to Tenant.

                               ARTICLE 2 - TERM
                               ----------------

         The Term of this Lease shall commence on the Commencement Date,
and shall expire on December 31, 2016.

                               ARTICLE 3 - RENT
                               ----------------

         3.1  Rent.  Tenant will pay to Landlord in lawful money of the
              ----
United States of America the Base Rent and Additional Rent during the Term.
Payments of Base Rent and Additional Rent shall be paid at Landlord's address
set forth in the Basic Lease Provisions or at such other place or to such
other Person as Landlord from time to time may designate in writing. If any


                                     -1-
<PAGE>
 
payment owing hereunder shall otherwise be due on a day that is not a Business 
Day, such payment shall be due on the next succeeding Business Day.

     3.2  Base Rent. Tenant shall pay Base Rent to Landlord in advance on the
          ---------
first day of each calendar month; provided, however, that the first monthly
                                  -----------------
installment shall be payable on the Commencement Date and the first and last
month's payments shall be prorated as to any partial month.

     3.3  Additional Rent. In addition to the Base Rent, Tenant shall pay to 
          ---------------
Landlord Additional Rent in quarterly installments as provided in Section 3.3.1.
                                                                  ------------- 

          3.3.1  Quarterly Calculation and Payment of Additional Rent. Tenant
                 ----------------------------------------------------
     shall calculate and pay Additional Rent for each Fiscal Quarter. The amount
     of the Additional Rent for the Second, Third and Fourth Fiscal Quarters
     shall account for any interim reconciliations made with respect to prior
     Fiscal Quarters in such Fiscal Year as certified by Tenant to Landlord as
     provided by this Section 3.3.1, but subject to a final reconciliation as
                      -------------
     provided by Section 3.3.2. Such Additional Rent shall be paid to Landlord,
                 -------------
     together with an Officer's Certificate setting forth the calculation
     thereof, within 30 days after the end of each Fiscal Quarter.

          3.3.2  Annual Reconciliation. Within 60 days after the end of each
                 --------------------- 
     Fiscal Year, or after the expiration or termination of the Lease, Tenant
     shall deliver to Landlord an Officer's Certificate setting forth (i) the
     Course Revenue and the Other Revenue for the Fiscal Year just ended, and
     (ii) a comparison of the amount of Additional Rent actually paid during
     such Fiscal Year versus the amount of Additional Rent actually owing on the
     basis of the annual calculation of the Course Revenue and the Other
     Revenue. If the Additional Rent for such Fiscal Year exceeds the sum of the
     quarterly payments previously paid by Tenant, Tenant shall pay such
     deficiency to Landlord along with such Officer's Certificate. If the
     Additional Rent for such Fiscal Year is less than the amount previously
     paid by Tenant, Landlord shall, at Tenant's option, either (i) remit to
     Tenant its check in an amount equal to such difference, or (ii) grant
     Tenant a credit against the payment of Additional Rent next coming due. The
     amount of the reconciliation payment, whether in favor of Landlord or
     Tenant, shall bear interest at a rate equal to the rate payable on 90-day
     U.S. Treasury Bills as of January 1 of the year following the close of such
     Fiscal Year until the amount of such difference shall be paid or otherwise
     discharged.

          3.3.3  Record-keeping. Tenant shall utilize an accounting system for
                 --------------
     the Leased Property in accordance with its usual and customary practices
     and in accordance with accrual basis accounting principles (applied on a
     basis consistent with the Other Leased Properties, if any) which

                                      -2-




    
<PAGE>
 
 
     will accurately record all Course Revenue and Other Revenue. Tenant shall
     utilize cash basis accounting principles in accounting for the amounts to
     be deposited into the Capital Improvement Account. Tenant shall retain
     reasonably adequate records for each Fiscal Year conforming to such
     accounting system until at least five years after the expiration of such
     Fiscal Year (and in any event until the reconciliation described in
     Section 3.3.2 above for such Fiscal Year has been made).
     -------------

          3.3.4  Audits. Landlord, at its own expense except as provided
                 -------
     hereinbelow, shall have the right upon reasonable prior written notice from
     time to time directly or through its accountants to audit the information
     set forth in the Officer's Certificate referred to in Section 3.3.2 and in
                                                           ------------- 
     connection with such audits to examine Tenant's books and records with
     respect thereto (including supporting data, sales tax returns and Tenant's
     work papers). If any such audit discloses a deficiency in the payment of
     Additional Rent, Tenant shall forthwith pay to Landlord the amount of the
     deficiency, as finally agreed or determined, together with interest at the
     Overdue Rate from the date when said payment should have been made to the
     date of payment thereof; provided, however, that as to any audit that is
                              -----------------
     commenced more than 12 months after the date Course Revenue or Other
     Revenue for any Fiscal Year is reported by Tenant to Landlord, the
     deficiency, if any, with respect to such Course Revenue or Other Revenue
     shall bear interest as permitted herein only from the date such
     determination of deficiency is made unless such deficiency is the result of
     gross negligence or willful misconduct on the part of Tenant. If any such
     audit discloses an overpayment of Additional Rent, Landlord shall apply
     such overpayment as a credit toward the payment of Rent next due. If any
     such audit discloses that the Course Revenue or Other Revenue actually
     received by Tenant for any Fiscal Year exceeds the Course Revenue or Other
     Revenue reported by Tenant by more than five percent, Tenant shall pay the
     reasonable cost of such audit and examination. Landlord shall not conduct
     more than two audits in any calendar year; provided that for purposes of
     such limitation any audit in which there were discrepancies in Course
     Revenue or Other Revenue in excess of $5,000 shall not count towards such
     limitation.
 
     3.4  Additional Charges. In addition to the Base Rent and Additional Rent, 
          -------------------
(1) Tenant shall also pay and discharge when due and payable all other amounts, 
liabilities, obligations and Impositions which Tenant assumes or agrees to pay 
under this Lease, and (2) in the event of any failure on the part of Tenant to 
pay any of those items referred to in clause (1) above, Tenant shall also pay 
and discharge every fine, penalty, interest and cost which may be added for 
non-payment or late payment of such items (the items referred to in clauses (1) 
and (2) above being referred to herein collectively as the "Additional
                                                            ----------- 
Charges"). Except as otherwise provided in this Lease, including Article 12, all
-------                                                          ----------
Additional Charges shall be due and payable 30 days after either


                                      -3-


<PAGE>
 
 
Landlord or the applicable third party who may be billing Tenant therefor shall 
deliver an invoice to Tenant therefor. To the extent that Tenant pays any
Additional Charges to Landlord pursuant to any requirement of this Lease, Tenant
shall be relieved of its obligation to pay such Additional Charges to the entity
to which they would otherwise be due.

     3.5  Late Payment of Rent. Tenant hereby acknowledges that late payment by 
          --------------------
Tenant to Landlord of Base Rent, Additional Rent or Additional Charges will 
cause Landlord to incur costs not contemplated under the terms of this Lease, 
the exact amount of which is presently anticipated to be extremely difficult to 
ascertain. Such costs may include processing and accounting charges and late 
charges which amy be imposed on Landlord by the terms of any mortgage or deed of
trust covering the Leased Property and other expenses of a similar or dissimilar
nature. Accordingly, if any installment of Base Rent, Additional Rent or 
Additional Charges (but only as to those Additional Charges which are payable 
directly to Landlord) shall not be paid within five Business Days after its due 
date, Tenant will pay Landlord on demand, as Additional Charges, a late charge 
equal to the lesser of five percent of such installment or $1,000. The parties 
agree that this late charge represents a fair and reasonable estimate of the 
costs that Landlord will incur by reason of late payment by Tenant. In addition,
if any installment of Base Rent, Additional Rent or Additional Charges (but only
as to those Additional Charges which are payable directly to Landlord) shall not
be paid on its due date, the amount unpaid shall bear interest, from the due
date of such installment to the date of payment thereof, computed at the Overdue
Rate on the amount of such installment, and Tenant will pay such interest to
Landlord on demand, as Additional Charges. The payment of said late charge or 
such interest shall not constitute a waiver, nor excuse or cure, of any default 
under this Lease, nor prevent Landlord from exercising any other rights and 
remedies available to Landlord.

     3.6 Net Lease. The Rent shall be paid absolutely net to Landlord and, 
         ----------
except as expressly provided in Section 4.7, Article 14 and Article 15, without 
                                -----------  ----------     ----------
notice or demand and without set-off, counterclaim, recoupment, abatement, 
suspension, deferment, deduction or defense, so that this Lease shall yield
to  Landlord the full amount of the installments of Base Rent, Additional
Rent and  Additional Charges throughout the Term, all as more fully set forth
in Article 5.
   ---------

     3.7 Marketing Programs.
         ------------------

          3.7.1  Tenant Conflicts. Landlord and Tenant recognize that Tenant or
                 ----------------
     its affiliates already has, and may in the future acquire the ownership or
     operation of other courses which compete with the Leased Property. Subject
     to Tenant's compliance with this Section 3.7, Landlord acknowledges this
                                      -----------
     potential conflict of interest and agrees that it does not constitute a
     breach or default of any term, condition, representation or warranty under
     the Lease, express


                                      -4-
<PAGE>
 
     or implied. Provided, however, Tenant agrees that it shall operate the
     Leased Property on an arm's-length and non-preferential basis with respect
     to other courses owned or operated by Tenant or its affiliates ("Tenant's
                                                                      -------- 
     Properties") (i.e. Tenant shall not operate the Leased Property or Tenant's
     ----------
     Properties so as to exhibit preferential treatment of Tenant's Properties
     at the expense of the Leased Property).

          3.7.2 Approval of Joint Usage Programs. Subject to Landlord's prior
                -------------------------------
     written approval and the provisions of this Section 3.7, Tenant may have
                                                 -----------
     the Leased Property participate in joint usage programs involving the
     Leased Property and properties of the Tenant other than the Leased Property
     (collectively, "Programs") that Tenant may sponsor from time to time.
                     --------
     Landlord agrees that it will not unreasonably withhold or delay its consent
     to such Programs if Landlord is reasonably satisfied that such Programs
     would not adversely affect the amount of Additional Rent to be payable
     hereunder nor otherwise adversely affect the Leased Property relative to
     Tenant's Properties. Tenant agrees as a condition to any such consent by
     Landlord to such Programs, that Landlord may require Tenant to provide to
     Landlord during the duration of such Programs such information (including
     rounds played and average green fees) regarding the Tenant Properties
     included in such Programs as Landlord may reasonably request to monitor
     that there are no discriminatory impacts of the Programs approved.

     3.8 Income/Expense Prorations. Income and expense items received or paid
         ------------------------- 
with respect to the period in which the Term commences or terminates shall be
adjusted and prorated between Landlord and Tenant as of the date of the
commencement or expiration of the Term or earlier termination of this Lease, as
applicable.


                           ARTICLE 4 -- IMPOSITIONS
                           ------------------------

     4.1 Payment of Impositions. Subject to Sections 4.7, 16.9 and 16.10, Tenant
         ----------------------             -----------  ----     -----
will pay, or cause to be paid, all Impositions before any fine, penalty,
interest or cost may be added for non-payment, such payments to be made directly
to the taxing authorities where feasible. All payments of Impositions shall be
subject to Tenant's right of contest pursuant to the provisions of Article 12.
                                                                   ----------
Upon request, Tenant shall promptly furnish to Landlord copies of official
receipts, if available, or other satisfactory proof evidencing such payments,
such as cancelled checks.

     4.2 Information and Reporting. Landlord shall give prompt notice to Tenant
         ------------------------- 
of all Impositions payable by Tenant hereunder of which Landlord at any time has
knowledge, but Landlord's failure to give any such notice shall in no way
diminish Tenant's obligations hereunder to pay such Impositions. Notwithstanding
the foregoing, Tenant shall not be liable for the payment of any fine, penalty,
interest or cost resulting from its


                                      -5-
<PAGE>
 
 
failure to pay in a timely manner any unforeseen and non-recurring charge of 
which it has not been timely notified by Landlord or notified otherwise in a 
timely manner. Landlord and Tenant shall, upon request of the other, provide 
such data as is maintained by the party to whom the request is made with 
respect to the Leased Property as may be necessary to prepare any required 
returns and reports. In the event any applicable governmental authorities 
classify any property covered by this Lease as personal property, Tenant shall 
file all personal property tax returns in such jurisdictions where it must 
legally so file.  Each party, to the extent it possesses the same, will provide 
the other party, upon request, with cost and depreciation records necessary for 
filing returns for any property so classified as personal property.


     4.3  Assessment Challenges. In addition to Tenant's rights under Article 
          ---------------------                                       -------
12, Tenant may, upon notice to Landlord, at Tenant's option and at Tenant's sole
--
cost and expense, protest, appeal, or institute such other proceedings as Tenant
may deem appropriate to effect a reduction of real estate or personal property 
assessment and Landlord, at Tenant's expense as aforesaid, shall fully 
cooperate with Tenant in such protest, appeal, or other action.


     4.4 Prorations. Impositions imposed in respect of the tax-fiscal period
         ----------
during which the Term commences or terminates shall be adjusted and prorated 
between Landlord and Tenant, whether or not such Imposition is imposed before or
after such termination, and the obligation of each party to pay its prorated 
share thereof shall survive such termination. If any Imposition may, at the 
option of the taxpayer, lawfully be paid in installments (whether or not 
interest shall accrue on the unpaid balance of such Imposition), Tenant may 
elect to pay in installments, in which event Tenant shall pay all installments 
(and any accrued interest on the unpaid balance of the Imposition) that are due 
during the Term hereof before any fine, penalty, premium, further interest or 
cost may be added thereto.

     4.5 Refunds. If any refund shall be due from any taxing authority in 
         -------
respect of any Imposition paid by Tenant, the same shall be paid over to or 
retained by Tenant if no Event of Default shall have occurred hereunder and be 
continuing. Any such funds retained by Landlord due to an Event of Default shall
be applied as provided in Article 16.
                          ----------



     4.6 Utility Charges. Tenant shall pay or cause to be paid prior to 
         ---------------
delinquency charges for all utilities and services, including, without 
limitation, electricity, telephone, trash disposal, gas, oil, water, sewer, 
communication and all other utilities used in the Leased Property during the 
Term.

     4.7 Reassessments Upon Transfer. Notwithstanding any other provision in 
         ---------------------------
this Lease to the contrary, Landlord shall pay all incremental increases in the 
Impositions under this Lease arising solely from (a) Landlord's sale, 
disposition or other


                                      -6-
<PAGE>
 
transfer of the Leased Property after the date of this Lease or (b) a change of
control in Landlord after the date of this Lease.

     4.8  Assessment Districts.  Neither party shall voluntarily consent to or 
          --------------------
agree in writing to (i) any special assessment or (ii) the inclusion of any 
material portion of the Leased Premises into a special assessment district or 
other taxing jurisdiction unless the other party shall have consented thereto, 
which consent shall not be unreasonably withheld.

                          ARTICLE 5 - TENANT WAIVERS
                          --------------------------

     5.1  No Termination, Abatement, Etc.  Except as otherwise specifically
          ------------------------------ 
provided in this Lease, (i) Tenant, to the extent permitted by law, shall remain
bound by this Lease in accordance with its terms and shall neither take any 
action without the consent of Landlord to modify, surrender or terminate the 
same, nor be entitled to any abatement, deduction, deferment or reduction of 
Rent, or set-off against the Rent by reason of, and (ii) the respective 
obligations of Landlord and Tenant shall not be otherwise affected by reason of:

     (a)  any damage to, or destruction of, any Leased Property or any portion 
thereof from whatever cause or any taking of the Leased Property or any portion 
thereof;

     (b)  the lawful or unlawful prohibition of, or restriction upon, Tenant's 
use of the Leased Property, or any portion thereof, the interference with such 
use by any Person or by reason of eviction by paramount title;

     (c)  any claim which Tenant has or might have against Landlord or by 
reason of any default or breach of any warranty by Landlord under this Lease or 
any other agreement between Landlord and Tenant (provided that Tenant does not 
waive its rights to pursue its remedies with respect to any defenses raised by 
Tenant in any legal action by Landlord against Tenant);

     (d)  any bankruptcy, insolvency, reorganization, composition, readjustment,
liquidation, dissolution or winding up of Landlord or any assignee or transferee
of Landlord except to the extent provided in the Federal bankruptcy laws or any 
other applicable law or statute of the United States of America or any state 
thereof; or

     (e)  for any other cause whether similar or dissimilar to any of the 
foregoing other than a discharge of Tenant from any such obligations as a matter
of law.

Except as otherwise specifically provided in this Lease, Tenant hereby 
specifically waives all rights, arising from any occurrence whatsoever, which 
may now or hereafter be conferred upon it by law (i) to modify, surrender or 
terminate this Lease or quit or surrender the Leased Property or any portion 
thereof, or (ii) to

                                      -7-

<PAGE>
 
entitle Tenant to any abatement, reduction, suspension or deferment of the Rent 
or other sums payable by Tenant hereunder.  The obligation of Landlord and 
Tenant hereunder shall be seperate and independent covenants and agreements and 
the Rent and all other sums payable by Tenant hereunder shall continue to be 
payable in all events unless the obligations to pay the same shall be 
terminated pursuant to the express provisions of this Lease or by termination of
this Lease other than by reason of an Event of Default.

     5.2  Condition of the Leased Property.  Tenant acknowledges receipt and 
          --------------------------------
delivery of possession of the Leased Property and that Tenant has examined or 
otherwise has knowledge of the condition of the Leased Property prior to the 
execution and delivery of this Lease.  Regardless, however, of any inspection 
made by Tenant of the Leased Property and whether or not any patent or latent 
defect or condition was revealed or discovered thereby, Tenant is leasing the 
Leased Property "as is" in its present condition.  Tenant waives and releases 
any claim or action against Landlord in respect of the condition of the Leased 
Property including any defects or adverse conditions latent or patent, matured 
or unmatured, known or unknown by Tenant or Landlord as of the date hereof.  
TENANT ACKNOWLEDGES THAT LANDLORD (WHETHER ACTING AS LANDLORD HEREUNDER OR IN 
ANY OTHER CAPACITY) HAS NOT MADE AND WILL NOT MAKE, NOR SHALL LANDLORD BE DEEMED
TO HAVE MADE, ANY WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, WITH RESPECT 
TO THE LEASED PROPERTY, INCLUDING ANY WARRANTY OR REPRESENTATION AS TO (i) ITS 
FITNESS, DESIGN OR CONDITION FOR ANY PARTICULAR USE OR PURPOSE, (ii) THE QUALITY
OF THE MATERIAL OR WORKMANSHIP THEREIN, (iii) THE EXISTENCE OF ANY DEFECT, 
LATENT OR PATENT, (iv) VALUE, (v) COMPLIANCE WITH SPECIFICATIONS, (vi) LOCATION,
(vii) USE, (viii) CONDITION, (ix) MERCHANTABILITY, (xii) QUALITY, (xiii) 
DESCRIPTION, (xiv) DURABILITY, (xv) OPERATION, (xvi) THE EXISTENCE OF ANY 
HAZARDOUS MATERIAL,  (xvii) COMPLIANCE OF THE LEASED PROPERTY WITH ANY LAW 
(INCLUDING ENVIRONMENTAL LAWS), OR LEGAL REQUIREMENTS.  TENANT ACKNOWLEDGES
THAT THE LEASED PROPERTY HAS BEEN INSPECTED BY TENANT AND IS SATISFACTORY TO IT.
IN THE EVENT OF ANY DEFECT OR DEFICIENCY IN THE LEASED PROPERTY OF ANY NATURE,
WHETHER LATENT OR PATENT, AS BETWEEN LANDLORD AND TENANT, LANDLORD SHALL NOT
HAVE ANY RESPONSIBILITY OR LIABILITY WITH RESPECT THERETO OR FOR ANY INCIDENTAL
OR CONSEQUENTIAL DAMAGES (INCLUDING STRICT LIABILTY IN TORT). THE PROVISIONS OF
THIS SECTION 5.2 HAVE BEEN NEGOTIATED, AND ARE INTENDED TO BE A COMPLETE
     -----------
EXCLUSION AND NEGATION OF ANY WARRANTIES BY LANDLORD, EXPRESS OR IMPLIED, WITH
RESPECT TO THE LEASED PROPERTY, ARISING PURSUANT TO THE UNIFORM COMMERCIAL CODE
OR ANY OTHER LAW NOW OR HEREAFTER IN EFFECT OR ARISING OTHERWISE.

     Tenant acknowledges that (i) Tenant has been operating and managing the 
Leased Property commencing on March 16, 1996 pursuant to a management agreement 
with Seller and that Tenant has superior knowledge of the condition of the 
Leased Property than does Landlord, (ii) Tenant has only the leasehold right of 
possession and use of the Leased Property as provided herein, (iii) to Tenant's 
actual knowledge the improvements and operation

                                      -8-
<PAGE>
 
of the Leased Property comply with all Legal Requirements and all material
insurance requirements, (iv) to Tenant's actual knowledge all easements and
licenses necessary or appropriate for the use or operation of the Leased
Property have been obtained, (v) to Tenant's actual knowledge all contractors
and subcontractors who have performed work on or supplied materials to the
Leased Property have been fully paid, and all materials to the Leased Property
have been fully paid for, (vi) to the best of Tenant's knowledge the
improvements have been completed in all material respects in a workmanlike
manner of first class quality, and (vii) to Tenant's actual knowledge all
equipment necessary or appropriate for the use or operation of the Leased
Property has been installed and is presently operative in all material respects.


                       ARTICLE 6 - OWNERSHIP OF PROPERTY
                       ---------------------------------

     6.1 Leased Property. Tenant acknowledge that the Leased Property is the 
         ---------------
property of Landlord and that Tenant has only the right to the exclusive 
possession and use of the Leased Property during the Term of and upon the terms 
and conditions of this Lease. Subject to the provisions of Article 24 below,
                                                           ---------- 
Landlord hereby represents and warrants to Tenant that as of the Commencement 
Date, Landlord has good and marketable title to the Leased Property free and 
clear of all liens and encumbrances, except with respect to those encumbrances 
referenced on Schedule B to the Title Commitment or as otherwise set forth in 
writing to Tenant prior to the Commencement Date.

     6.2 Landlord's Personal Property. If Landlord has provided any Landlord's 
         ----------------------------
Personal Property (as described in Exhibit E), Tenant shall maintain such 
Property in the same manner as Tenant maintains Tenant's Personal Property. Upon
the loss, destruction, or obsolescence of any of the Landlord's Personal 
Property, Tenant shall replace such property with Tenant's Personal Property, 
which such property shall be owned by Tenant. Upon the expiration or sooner 
termination of this Lease, Tenant shall be obligated to leave at the Facility at
no cost to Landlord and free of any liens or encumbrances: (i) any Landlord's 
Personal Property; and (ii) any replacements of Landlord's Personal Property, 
provided that the condition of the replacements shall be substantially 
comparable to the condition, age and quality of the replaced Landlord's Personal
Property as of the Commencement Date.

     6.3 Tenant's Personal Property. Tenant may (and shall as provided below),
         -------------------------- 
at its expense, install, affix or assemble or place on any parcels of the Land 
or in any of the Leased Improvements, any items of Tenant's Personal Property, 
and Tenant may, subject to the conditions set forth below, remove the same upon 
the expiration or any prior termination of the Term. Tenant shall provide and 
maintain during the entire Lease Term all such Tenant's Personal Property as 
shall be necessary in order to operate the Facility in compliance with all 
applicable Legal Requirements and Insurance Requirements and otherwise in 
accordance with customary practice in the industry for the Primary Intended Use 
and in accordance with its past practices.




                                      -9-
<PAGE>
 
     6.4 Purchase of Tenant's Personal Property. Upon the expiration or sooner
         ---------------------------------------
termination of this Lease, Landlord shall have the right (but not the 
obligation) to purchase from Tenant all, but not less than all, of tangible 
Tenant's Personal Property (which shall not include software):

     (i) if owned by Tenant and not subject to any secured financing entered
     into in good faith by Tenant with an unaffiliated Person, at the fair
     market value thereof (subject to Section 6.2);
                                      -----------
     (ii) if owned by Tenant, but subject to such secured financing, at the 
     greater of the fair market value thereof or the amount of the debt owing 
     under such financing (subject to Section 6.2); and
                                      -----------

     (iii) if leased by Tenant in good faith from an unaffiliated Person, and 
     the applicable lease provides for termination of the lease as to such 
     Property upon the payment of a given sum, at the greater of the fair market
     value thereof or the amount of the payment so provided; provided, however, 
                                                             ------------------
     that at Tenant's option and if the lessor will permit Landlord to assume 
     the obligations under the applicable lease with respect to such Property 
     (separate from the obligations under a master lease if in effect), Tenant 
     shall, upon the request of Landlord, assign the applicable lease (or 
     portion thereof) to Landlord;

provided, further, however, that if Landlord's purchase right arises because of 
--------------------------
a termination of this Lease as a result of an Event of Default, the fair market 
value under clauses (i) through (iii) above shall be deemed to be the 
depreciated net book value of Tenant's Personal Property. Landlord may elect to 
purchase Tenant's Personal Property by giving notice to Tenant not later than, 
as the case may be, 60 days prior to the expiration of this Lease or 60 days 
after the termination of this Lease upon any Event of Default. Tenant shall 
transfer title to such Property by a bill of sale without warranty (except as to
ownership free of liens) upon concurrent payment in cash by Landlord; provided, 
                                                                      ---------
however, if Landlord has any unpaid damages resulting from any Event of Default,
-------- 
Landlord may make payment by delivery of a receipt for an offset against such 
damages to the extent of any cash payment otherwise owed by Tenant to Landlord.


     6.5 Removal of Personal Property. All items of Tenant's Personal Property
         ----------------------------
not removed by Tenant within 30 days following the expiration or earlier
termination of this Lease shall be considered abandoned by Tenant and may, at
Landlord's discretion and without any obligation, be appropriated, sold,
destroyed or otherwise disposed of by Landlord without first giving notice
thereof to Tenant and without any payment to Tenant and without any obligation
to account therefor. Tenant shall, at its expense, restore the Leased Property
to the condition required by Section 9.1, including repair of all damage to the
                             -----------
Leased Property



                                     -10-


<PAGE>
 
caused by the removal of Tenant's Personal Property, whether effected by Tenant 
or Landlord. Landlord shall not be responsible for any loss or damage to 
Tenant's Personal Property, or any other property of Tenant, by virtue of 
Landlord's removal thereof at any time subsequent to the 30 day period provided 
for herein. Landlord hereby grants to Tenant a temporary license to remove 
Tenant's Personal Property (subject to Section 6.4 above) within said 30 day 
                                       ------------
period.

     6.6 Landlord's Waivers. Any lessor of Tenant's Personal Property may, upon 
         -------------------
notice to Landlord and during reasonable hours, enter the Facility and take 
possession of any of Tenant's Personal Property without liability for trespass 
or conversion. Landlord shall, upon the request of Tenant, execute and deliver 
to Tenant "landlord's waivers" as may be reasonable and customary in connection 
with the financing or leasing of personal property. Such "landlord's waiver" 
shall limit to 30 days the amount of time the lessor or lender has to enter upon
the Leased Premises after notice from Landlord that the Term has expired or 
otherwise terminated. If Tenant requests a "landlord's waiver," Tenant shall 
attempt to secure from any financing source or lessor the right on the part of 
Landlord to cure the defaults of Tenant and to use any such Property upon 
providing such cure.

     6.7 Water Rights
         ------------

     6.7.1 Landlord Rights. If and to the extent Landlord has any Water Rights 
           ----------------
by virtue of its ownership of the Leased Property or to the extent Landlord 
otherwise acquires Water Rights specifically for use by the Leased Property, 
Landlord agrees to make such Water Rights available to Tenant at Landlord's cost
for Tenant to fulfill its obligations hereunder. Landlord make no assurances 
whatsoever as to the existence, quantity, priority or price of any Water Rights 
owned by Landlord. Landlord shall have no obligation to acquire or expend funds 
to maintain the ownership of any Water Rights.

     6.7.2 Tenant Rights. If and to the extent as of the Commencement Date, 
           --------------
Tenant owns any rights for the supply or transportation of water to the Leased 
Property (the "Tenant's Original Water Rights"), Tenant shall, through the Term
              --------------------------------
and subject to the provisions of this Section 6.7, maintain and hold Tenant's 
                                      -----------
Original Water Rights on a first priority basis for the benefit of the Leased 
Property. If and solely to the extent that Tenant's Original Water Rights 
provide resources in excess of what is needed to properly serve the Leased 
Property, Tenant may use Tenant's Original Water Rights for other purposes as it
determines consistent with any restrictions under applicable law or the terms of
Tenant's Original Water Rights. During the Term, Tenant may shall or exchange 
Tenant's Original Water Rights if, prior to doing so, Tenant secures Replacement
Water Rights. Upon the expiration or sooner termination of this Lease, Tenant 
shall, within 10 days after request made by Landlord, transfer to Landlord or 
its designee for no consideration Tenant's Original Water Rights (to the extent 
still owned by Tenant) and all Replacement Water Rights.


                                     -11-

<PAGE>
 
Upon the expiration or sooner termination of this Lease, to the extent Tenant 
had sold or exchanged Tenant's Original Water Rights during the Term, Tenant 
shall deliver to Landlord or its designee Replacement Water Rights that are not 
less favorable in any material respect to the holder of such Water Rights than 
the quantity, price and priority of Tenant's Original Water Rights.

        6.8 Liquor License. Tenant shall take whatever steps are commercially 
necessary to keep a Liquor License in effect during the Term. Upon the 
expiration of the Term or earlier termination of this Lease, Tenant shall 
transfer the Liquor License to Landlord (or its designee), subject to applicable
law, for a purchase price of $1.00; provided, however, Landlord shall pay all 
costs and expenses with respect to the transfer of the Liquor License to 
Landlord. Tenant shall cooperate in all respects with Landlord (and its 
designee) in order to affect an orderly transfer of the Liquor License to 
Landlord (or its designee) including, without limitation, completing all 
application forms, providing such information and documents as may be required 
by applicable governmental agencies, and appearing and testifying at any public 
hearings in connection with the transfer of the Liquor License to Landlord (or 
its designee).

                      ARTICLE 7 - USE OF LEASED PROPERTY

        7.1 Use. After the Commencement Date and during the Term, Tenant shall 
use or cause to be used the Leased Property and the improvements thereon for 
its Primary Intended Use and for such other uses as may be necessary or 
incidental to such use. Tenant shall not use the Leased Property or any portion 
thereof for any other use without the prior written consent of Landlord, which 
consent shall not be unreasonably withheld. No use shall be made or permitted to
be made of the Leased Property, and no acts shall be done, which will cause the 
cancellation of any insurance policy covering the Leased Property or any part 
thereof, nor shall Tenant sell or otherwise provide to patrons, or permit to be 
kept, used or sold in or about the Leased Property any article which may be 
prohibited by law or by the standard form of fire insurance policies, or any 
other insurance policies required to be carried hereunder, or fire underwriters 
regulations. Tenant shall, at its sole cost, comply with all of the requirements
pertaining to the Leased Property or other improvements of any insurance board, 
association, organization or company necessary for the maintenance of insurance,
as herein provided, covering the Leased Property and Tenant's Personal Property.

        7.2 Specific Prohibited Uses. Tenant shall not use or occupy or permit 
the Leased Property to be used or occupied, nor do or permit anything to be done
in or on the Leased Property, in a manner which would (i) violate or fail to 
comply with any law, rule or regulation or Legal Requirement, (ii) subject to 
Article 10, cause structural injury to any of the Improvements or (iii) 
constitute a public or private nuisance or waste. Tenant shall not allow any 
Hazardous Material to be located in, on or under the Leased Property or 
incorporated in the Facility or any improvements

                                     -12-

<PAGE>
 
thereon except in compliance with applicable law (including any Environmental 
Law). Tenant shall not allow the Leased Property to be used as a landfill or a 
waste disposal site, or a manufacturing, distribution or disposal facility for 
any Hazardous Materials. Tenant shall neither suffer nor permit the Leased 
Property or any portion thereof, including Tenant's Personal Property, to be 
used in such a manner as (i) might reasonably tend to impair Landlord's title 
thereto or to any portion thereof, or (ii) may reasonably make possible a claim 
or claims of adverse usage or adverse possession by the public, as such, or of 
implied dedication of the Leased Property or any portion thereof, or (iii) is in
material violation of any applicable Environmental Law.

                        ARTICLE 8 - HAZARDOUS MATERIALS

        8.1 Remediation. If Tenant becomes aware of the presence of any 
Hazardous Material in a quantity sufficient to require remediation or reporting 
under any applicable Environmental Law in, on or under the Leased Property or if
Tenant, Landlord, or the Leased Property becomes subject to any order of any 
federal, state or local agency to investigate, remove, remediate, repair, close,
detoxify, decontaminate or otherwise clean up the Leased Property, Tenant shall,
at its sole expense, carry out and complete any required investigation, removal,
remediation, repair, closure, detoxification, decontamination or other cleanup 
of the Leased Property; provided, however, that Tenant shall have the right to 
contest in good faith such requirements in accordance with applicable law as 
long as Tenant has notified Landlord of such contest and Landlord reasonable
consents to such contest. If Tenant fails to implement and diligently pursue any
such repair, closure, detoxification, decontamination or other cleanup of the
Leased Property in a timely manner (after exhausting its right to contest such
requirement), Landlord shall have the right, but not the obligation after
written notification to Tenant and Tenant's failure to cure as provided herein
to carry out such action and to recover all of the reasonable costs and expenses
from Tenant as Additional Charges.

        8.2 Tenant's Indemnification of Landlord. Tenant shall pay, protect, 
indemnify, save, hold harmless and defend Landlord and any Facility Mortgagee 
from and against all liabilities, obligations, claims, damages (including 
punitive damages), penalties, causes of action, demands, judgments, costs and 
expenses (including reasonable attorneys' fees and expenses), to the extent 
permitted by law, imposed upon or involuntarily incurred by or asserted against 
Landlord or the Leased Property by reason of any Environmental Law (irrespective
of whether there has occurred any violation of any Environmental Law) in respect
of the Leased Property howsoever arising, without regard to fault on the part of
Tenant, including (a) liability for response costs and for costs of removal and 
remedial action incurred by the United States Government, any state or local 
governmental unit or any other Person, or damages from injury to or destruction 
or loss of natural resources, including the reasonable costs of assessing such 
injury, destruction or loss, incurred pursuant to any Environmental Law,

                                     -13-










<PAGE>
 
(b) liability for costs and expenses of abatement, investigation, removal, 
remediation, correction or clean-up, fines, damages, response costs or penalties
which arise from the provisions of any Environmental Law, or (c) liability for 
personal injury or property damage arising under any statutory or common-law 
tort theory, including damages assessed for the maintenance of a public or 
private nuisance or for carrying on of a dangerous activity. Notwithstanding the
foregoing or any other provision of this Lease (including, without limitation, 
Section 5.2, Section 8.4 and Article 21), Tenant shall not be liable, or 
otherwise be required to indemnify Landlord (or any Facility Mortgagee) from and
against any matters, conditions or events that arose, existed or occurred prior 
to the Commencement Date or that arise or first occur after the expiration or 
earlier termination of the Term, or that are caused by Landlord or a Facility 
Mortgagee; provided, that this sentence shall not relieve Tenant of its 
obligation to operate the Leased Property during the Term in compliance with 
Environmental Laws including Tenant's obligation to maintain, repair, remove or 
replace any underground storage tanks.

        8.3 Landlord's Indemnification of Tenant. Landlord shall pay, protect, 
indemnify, save, hold harmless and defend Tenant from and against all 
liabilities, obligations, claims, damages (including punitive damages), 
penalties, causes of action, demands, judgments, costs and expenses (including 
reasonable attorneys' fees and expenses), to the extent permitted by law, 
imposed upon or incurred by or asserted against Tenant or the Leased Property by
reason of any Environmental Law (irrespective of whether there has occurred any 
violation of any Environmental Law) in respect of any matter, condition, or 
event that arose, existed or occurred prior to the Commencement Date, without 
regard to fault on the part of Landlord, including (a) liability for response 
costs and for costs of removal and remedial action incurred by the United States
Government, any state or local governmental unit or any other Person, or 
damages from injury to or destruction or loss of natural resources, including 
the reasonable costs of assessing such injury, destruction or loss, incurred 
pursuant to any Environmental Law, (b) liability for costs and expenses of 
abatement, investigation, removal, remediation, correction or clean-up, fines, 
damages, response costs or penalties which arise from the provisions of any 
Environmental Law, or (c) liability for personal injury or property damage 
arising under any statutory or common-law tort theory, including damages 
assessed for the maintenance of a public or private nuisance or for carrying on 
of a dangerous activity; provided, that this sentence shall not relieve Tenant 
of its obligation to operate the Leased Property during the Term in compliance 
with Environmental Laws including Tenant's obligation to maintain, repair, 
remove or replace any underground storage tanks.

        8.4 Survival of Indemnification Obligations. The obligations and/or 
liability of the parties under this Article 8 arising during the Term hereof 
shall survive any termination of this Lease.

                                     -14-
<PAGE>
 
        8.5 Environmental Violations at Expiration or Termination of Lease. 
Notwithstanding any other provision of this Lease, if, at a time when the Term 
would otherwise terminate or expire, a violation of any Environmental Law has 
been asserted by Landlord and has not been resolved in a manner reasonably 
satisfactory to Landlord, or has been acknowledged by Tenant to exist or has 
been found to exist at the Leased Property or has been asserted by any 
governmental authority and failure to have completed all action required to 
correct, abate or remediate such a violation of any Environmental Law materially
impairs the leaseability of the Leased Property upon the expiration of the Term,
and if Tenant is responsible for such violation under the provisions of Sections
8.1 or 8.2, then, at the option of Landlord, the Term shall be automatically 
extended with respect to the Leased Property beyond the date of termination or 
expiration and this Lease shall remain in full force and effect under the same 
terms and conditions beyond such date with respect to the Leased Property until 
the earlier to occur of (i) the completion of all remedial action in accordance 
with applicable Environmental Laws or (ii) 12 months beyond such expiration or 
termination date; provided, that Tenant may, upon any such extension of the 
Term, terminate the Term by paying to the Landlord such amount as is necessary 
in the reasonable judgment of Landlord to complete or perform such remedial 
action.

                      ARTICLE 9 - MAINTENANCE AND REPAIR

        9.1 Tenant's Sole Obligation. Subject to Unavoidable Delays, Tenant, at 
its expense, will keep the Leased Property and Tenant's  Personal Property in 
good order, repair and appearance (whether or not the need for such repairs 
occurs as a result of Tenant's use, any prior use, the elements or the age of 
the Leased Property, or any portion thereof) and maintain the Leased Property in
accordance with any applicable Legal Requirements, and, except as otherwise 
provided in Article 14, with reasonable promptness, make all necessary and 
appropriate repairs thereto of every kind and nature, whether interior or 
exterior, structural or non-structural, ordinary or extraordinary, foreseen or 
unforeseen or arising by reason of a condition existing prior to the 
commencement of the Term of this Lease (concealed or otherwise). Subject to 
Unavoidable Delays, Tenant shall maintain the Leased Premises in accordance with
the Operating Standards set forth in Exhibit D; provided, however, that Tenant 
may make such modifications to such Operating Standards as Tenant may reasonably
determine to be appropriate for the prudent management of the Leased Property or
as may be appropriate to comply with Legal Requirements. Nothing in this Article
9 shall obligate Tenant to make any capital improvements or replacements to the 
Leased Property if the Leased Property can be repaired to the standard required 
by this Section 9.1.

        9.2 Waiver of Statutory Obligations. Subject to the terms and conditions
of Article 14, Landlord shall not under any circumstances be required to build
or rebuild any improvements on the Leased Property, or to make any repairs,
replacements, alterations, restorations or renewals of any nature or description
to the Leased Property, whether ordinary or extraordinary,

                                     -15-
<PAGE>
 
structural or non-structural, foreseen or unforeseen, or to make any expenditure
whatsoever with respect thereto, in connection with this Lease, or to maintain 
the Leased Property in any way. Tenant hereby waives, to the extent permitted by
law, the right to make repairs at the expense of Landlord pursuant to any law in
effect at the time of the execution of this Lease or hereafter enacted.

        9.3 Mechanic's Liens. Nothing contained in this Lease and no action or 
inaction by Landlord shall be construed as (i) constituting the consent or 
request of Landlord expressed or implied, to any contractor, subcontractor, 
laborer, materialman or vendor to or for the performance of any labor or 
services or the furnishing of any materials or other property for the 
construction, alteration, addition, repair or demolition of or to the Leased 
Property or any part thereof; or (ii) giving Tenant any right, power or 
permission to contract for or permit the performance of any labor or services or
the furnishing of any materials or other property, in either case, in such 
fashion as would permit the making of any claim against Landlord in respect 
thereof or to make any agreement that may create, or in any way be the basis 
for, any right, title, interest, lien, claim or other encumbrance upon the 
estate of Landlord in the Leased Property, or any portion thereof.

        9.4 Surrender of Leased Property. Unless the Lease shall have been
terminated pursuant to the provisions of Article 14, Tenant shall, upon the
expiration or prior termination of the Term, vacate and surrender the Leased
Property to Landlord in the condition in which the Leased Property was
originally received from Landlord, except as repaired, rebuilt, restored,
altered or added to as permitted or required by the provisions of this Lease and
except for ordinary wear and tear (subject to the obligation of Tenant to
maintain the Leased Property in good order and repair during the entire Term of
the Lease) and except for casualty or damage not required to be repaired by
Tenant.

                      ARTICLE 10 - TENANT'S IMPROVEMENTS

        10.1 Tenant's Right to Construct. During the Term of this Lease, Tenant
may make alterations, additions, changes and/or improvements to the Leased 
Property (individually, a "Tenant Improvement," and collectively, "Tenant 
Improvements"). Except as otherwise agreed to by Landlord in writing, any such 
Tenant Improvement shall be made at Tenant's sole expense and shall become the 
property of Landlord upon termination of this Lease. Unless made on an emergency
basis to prevent injury to Person or property, Tenant will submit plans for any 
Tenant Improvement with a value of more than $100,000 in the first Fiscal Year 
(and increased by three percent per annum for each subsequent Fiscal Year) to 
Landlord for Landlord's prior approval, such approval not to be unreasonably 
withheld or delayed.

        10.2 Scope of Right. Subject to Section 10.1, at Tenant's cost and 
expense, Tenant shall have the right to:

                                     -16-
<PAGE>
 
        (a) seek any governmental approvals, including building permits,
        licenses, conditional use permits and any certificates of need that
        Tenant requires to construct any Tenant Improvement;

        (b) demolish, remove or otherwise dispose of any of the Leased 
        Improvements;

        (c) erect upon the Leased Property such Tenant Improvements as Tenant 
        deems desirable;

        (d) make additions, alterations, changes and improvements in any Tenant 
        Improvement so erected;

        (e) raze and demolish any Tenant Improvement together with the right to 
        salvage therefrom; and

        (f) engage in any other lawful activities that Tenant determines are
        necessary or desirable for the development of the Leased Property in
        accordance with its Primary Intended use;

provided, however, Tenant shall not make any Tenant Improvement which would, in 
Landlord's reasonable judgment, impair in any material respect the value or 
Primary Intended Use of the Leased Property without Landlord's prior written 
consent.

        10.3 Cooperation of Landlord. Landlord shall cooperate with Tenant and 
take such actions, including the execution and delivery to Tenant of any 
applications or other documents, reasonably requested by Tenant in order to 
obtain any governmental approvals sought by Tenant to construct any Tenant 
Improvement within 10 Business Days following the later of (a) the date Landlord
receives Tenant's request, or (b) the date of delivery of any such application 
or document to Landlord, so long as the taking of such action, including the 
execution of said applications or documents, shall be without cost to Landlord 
(or if there is a cost to Landlord, such cost shall be reimbursed by Tenant), 
and will not cause Landlord to be in violation of any law, ordinance or 
regulation.

        10.4 Commencement of Construction. Tenant agrees that:

        (a) Tenant shall diligently seek all governmental approvals relating to 
        the construction of any Tenant Improvement;

        (b) Once Tenant begins the construction of any Tenant Improvement,
        Tenant shall diligently prosecute any such construction to completion in
        accordance with applicable insurance requirements and the laws, rules
        and regulations of all governmental bodies or agencies having
        jurisdiction over the Leased Property;

                                     -17-


<PAGE>
 
        (c) Landlord shall have the right at any time and from time to time to
        post and maintain upon the Leased Property such notices as may be
        necessary to protect Landlord's interest from mechanic's liens,
        materialmen's liens or liens of a similar nature;

        (d) Tenant shall not suffer or permit any mechanic's liens or any other
        claims or demands arising from the work of construction of any Tenant
        Improvement to be enforced against the Leased Property or any part
        thereof, and Tenant agrees to hold Landlord and said Leased Property
        free and harmless from all liability from any such liens, claims or
        demands, together with all costs and expenses in connection therewith,
        and

        (e) All work shall be performed in a good and workmanlike manner.

        10.5 Rights in Tenant Improvements. Notwithstanding anything to the 
contrary in this Lease, all Tenant Improvements constructed pursuant to Section 
10.1, and any and all subsequent additions thereto and alterations and
replacements thereof, shall be the sole and absolute property of Tenant during
the Term of this Lease. Upon the expiration or early termination of this Lease,
all such Tenant Improvements shall become the property of Landlord. Without
limiting the generality of the foregoing, Tenant shall be entitled to all
federal and state income tax benefits associated with any Tenant Improvement
during the Term of this Lease.

    ARTICLE 11 - LIENS, ENCROACHMENTS AND OTHER TITLE MATTERS

        11.1 Liens. Subject to the provisions of Article 12 relating to 
permitted contests, Tenant will not directly or indirectly create or allow to 
remain, and will promptly discharge at its expense any lien, encumbrance, 
attachment, title retention agreement or claim upon the Leased Property or any 
attachment, levy, claim or encumbrance in respect of the Rent, not including, 
however;

        (a) this Lease;

        (b) the matters, if any, that existed as of the Commencement Date;

        (c) restrictions, liens and other encumbrances which are consented to in
        writing by Landlord;

        (d) liens for those taxes of Landlord, if any, which Tenant is not 
        required to pay hereunder;

        (e) subleases and leasehold mortgages permitted by Article 22;

        (f) liens for Impositions or for sums resulting from noncompliance with 
        Legal Requirements so long as (1) the

                                     -18-
<PAGE>
 
        same are not yet payable or are payable without the addition of any fine
        or penalty or (2) such liens are in the process of being contested as
        permitted by Article 12;

        (g) liens of mechanics, laborers, materialmen, suppliers or vendors for
        sums either disputed (provided that such liens are in the process of
        being contested as permitted by Article 12) or not yet due; and

        (h) any liens which are the responsibility of Landlord pursuant to the
        provisions of Article 24 or liens arising from the acts of Landlord's
        employees or authorized agents or any Person (other than Tenant) whose
        claim arose under Landlord.

        11.2 Encroachments and Other Title Matters. Excepting any matters 
granted or created by Landlord or otherwise existing on the Commencement Date, 
if any of the Leased Improvements shall, at any time, encroach upon any 
property, street or right-of-way adjacent to the Leased Property, or shall 
violate the agreements or conditions contained in any lawful restrictive 
covenant or other agreement affecting the Leased Property, or any part thereof, 
or shall impair the rights of others under any easement or right-of-way to which
the Leased Property is subject, or the use of the Leased Property is impaired, 
limited or interfered with by reason of the exercise of the right of surface 
entry or any other rights under a lease or reservation of any oil, gas, water or
other minerals, then promptly upon the request of Landlord or at the behest of 
any Person affected by any such encroachment, violation or impairment, Tenant, 
at its sole cost and expense (subject to its right to contest the existence of 
any such encroachment, violation or impairment), shall protect, indemnify, save 
harmless and defend Landlord from and against all losses, liabilities, 
obligations, claims, damages, penalties, causes of action, costs and expenses 
(including reasonable attorneys' fees and expenses) based on or arising by 
reason of any such encroachment, violation or impairment and in such case, in 
the event of an adverse final determination, either (i) obtain valid and 
effective waivers or settlements of all claims, liabilities and damages 
resulting from each such encroachment, violation or impairment, whether the same
shall affect Landlord or Tenant; or (ii) make such changes in the Leased 
Improvements, and take such other actions, as Tenant in the good faith exercise 
of its judgment deems reasonably practicable, to remove such encroachment, and 
to end such violation or impairment, including, if necessary, the alteration of 
any of the Leased Improvements, and in any event take all such actions as may be
necessary in order to be able to continue the operation of the Leased 
Improvements for the Primary Intended Use substantially in the manner and to the
extent the Leased Improvements were operated prior to the assertion of such 
violation or encroachment. Tenant's obligations under this Section 11.2 shall be
in addition to and shall in no way discharge or diminish any obligation of any 
insurer under any policy of title or other insurance and Tenant shall be 
entitled to a credit for any sums recovered by Landlord under

                                     -19-
<PAGE>
 
(i) any such policy of title or other insurance, or (ii) any suit or action 
against any Person involved in said matter. If Landlord is a necessary party to 
any such action, Tenant shall, at Tenant's expense and with such indemnification
as Landlord shall reasonably request, have the right to pursue claims against 
Landlord's title insurance or any other Person involved in said matter.

                        ARTICLE 12 - PERMITTED CONTESTS

        Tenant, on its own or on Landlord's behalf (or in Landlord's name) but 
at Tenant's expense, may contest, by appropriate legal proceedings conducted in 
good faith and with due diligence, the amount or validity or application, in 
whole or in part, of any Imposition or any Legal Requirement or Insurance 
Requirement or any lien, attachment, levy, encumbrance, charge or claim not 
otherwise permitted by Section 11.1, provided that:

        (a) in the case of an unpaid Imposition, lien, attachment, levy,
        encumbrance, charge or claim, the commencement and continuation of such
        proceedings shall suspend the collection thereof from Landlord and from
        the Leased Property, and neither the Leased Property nor any Rent
        therefrom nor any part thereof or interest therein would be in any
        danger of being sold, forfeited, attached or lost pending the outcome of
        such proceedings;

        (b) in the case of a Legal Requirement, Landlord would not be subject to
        criminal or material civil liability for failure to comply therewith
        pending the outcome of such proceedings. Nothing in this Section 12(b),
        however, shall permit Tenant to delay compliance with any requirement of
        an Environmental Law to the extent such non-compliance poses an
        immediate threat of injury to any Person or to the public health or
        safety of  material damage to any real or personal property;

        (c) in the case of a Legal Requirement and/or an Imposition, lien,
        encumbrance or charge, Tenant shall give such reasonable security, if
        any, as may be demanded by Landlord to insure ultimate payment of the
        same and to prevent any sale or forfeiture of the affected Leased
        Property or the Rent by reason of such non-payment or noncompliance,
        provided, however, the provisions of this Article 12 shall not be
        construed to permit Tenant to contest the payment of Rent (except as to
        contests concerning the method of computation or the basis of levy of
        any Imposition or the basis for the assertion of any other claim) or any
        other sums payable by Tenant to Landlord hereunder;

        (d) no such contest shall interfere in any material respect with the use
        or occupancy of the Leased Property;

        (e) in the case of an Insurance Requirement, the coverage required by 
        Article 13 shall be maintained; and

                                     -20-
<PAGE>
 
        (f) if such contest be finally resolved against Landlord or Tenant,
        Tenant shall, as Additional Charges due hereunder, promptly pay the
        amount required to be paid, together with all interest and penalties
        accrued thereon, or comply with the applicable Legal Requirement or
        Insurance Requirement.

Landlord, at Tenant's expense, shall execute and deliver to Tenant such 
authorizations and other documents as may reasonably be required in any such 
contest, and, if reasonably requested by Tenant or if Landlord so desires, 
Landlord shall join as a party therein. Tenant shall indemnify and save Landlord
harmless against any liability, cost or expense of any kind that may be imposed 
upon Landlord in connection with any such contest and any loss resulting 
therefrom.

                            ARTICLE 13 - INSURANCE

        13.1 General Insurance Requirements. During the Term of this Lease, 
Tenant shall at all times keep the Leased Property, and all property located in 
or on the Leased Property, including all Tenant's Personal Property and any 
Tenant Improvements, insured with the kinds and amounts of insurance described 
below. This insurance shall be written by companies authorized to do insurance 
business in the State in which the Leased Property is located. The policies must
name Landlord as an "Additional Insured." Losses shall be payable to Landlord 
and/or Tenant as provided in Article 14. In addition, the policies shall name as
an additional insured the holder of any mortgage, deed of trust or other 
security agreement securing any indebtedness or any other Landlord's Encumbrance
placed on the Leased Property in accordance with the provisions of Article 24 
("Facility Mortgage") by way of a standard form of mortgagee's loss payable 
endorsement. Any loss adjustment shall require the written consent of Landlord, 
Tenant, and each Facility Mortgage, not to be unreasonably withheld. Evidence of
insurance shall be deposited with Landlord and, if requested, with any Facility 
Mortgagee(s). The policies on the Leased Property, including the Leased 
Improvements, Fixtures, Tenant's Personal Property and any Tenant Improvements, 
shall insure against the following risks:

                13.1.1 All Risk. Loss or damage by all risks perils including
      but not limited to, fire, vandalism, malicious mischief and extended
      coverages, including but not limited to, sprinkler leakage, in an amount
      not less than 100% of the then Full Replacement Cost thereof.

                13.1.2 Liability. Claims for personal injury or property damage
      under a policy of commercial general liability insurance with amounts not
      less than $10,000,000 per occurrence and in the aggregate.

                13.1.3 Flood. Flood and such other hazards and in such amounts
      as may be customary for comparable properties in the area; provided
      however, the Tenant shall not be

                                     -21-
<PAGE>
 
      required to participate in the National Flood Insurance Program.

                13.1.4 Worker's Compensation. Adequate worker's compensation
      insurance coverage for all Persons employed by Tenant on the Leased
      Property in accordance with the requirements of applicable federal, state
      and local laws.

                13.1.5 Other Insurance. Such other insurance on or in connection
      with any of the Leased Property as Landlord or any Facility Mortgage may
      reasonably require, which at the time is usual and commonly obtained in
      connection with properties similar in type of building size and use to the
      Leased Property and located in the geographic area where the Leased
      Property is located; provided however, that Landlord shall bear the cost
      of any such coverage requested under this Section 13.1.5.

        13.2 Replacement Cost. In the event either party believes that the Full 
Replacement Cost of the insured property has increased or decreased at any time 
during the Lease Term, it shall have the right to have such Full Replacement 
Cost redetermined by the fire insurance company which is then carrying the 
largest amount of fire insurance carried on the Leased Property (the "Impartial 
Appraiser"). The party desiring to have the Full Replacement Cost so 
redetermined shall forthwith, on receipt of such determination by such Impartial
Appraiser, given written notice thereof to the other party hereto. The 
determination of such Impartial Appraiser shall be final and binding on the 
parties hereto, and Tenant shall forthwith increase, or may decrease, the amount
of the insurance carried pursuant to this Section 13.2, as the case may be, to 
the amount so determined by the Impartial Appraiser. Each party shall pay 
one-half of the fee, if any, of the Impartial Appraiser.

        13.3 Waiver of Subrogation. Landlord and Tenant waive their respective 
right of recovery against the other to the extent damage or liability is insured
against under a policy or policies of insurance. All insurance policies carried 
by either party covering the Leased Property including contents, fire and 
casualty insurance, shall expressly waive any right of subrogation on the part 
of the insurer against the other party (including any Facility Mortgagee). The 
parties hereto agree that their policies will include such waiver clause or 
endorsement so long as the same are obtainable without extra cost, and in the 
event of such an extra charge the other party, at its election, may pay the 
same, but shall not be obligated to do so.

        13.4 Form Satisfactory, Etc. All of the policies of insurance referred 
to in Section 13.1 shall be written in a form reasonably satisfactory to
Landlord and by insurance companies rated not less than A-X by A.M. Best's
Insurance Guide. In addition, all insurance carried by Tenant hereunder shall
have deductible amounts which are reasonably acceptable to Landlord. Tenant
shall pay all premiums for the policies of insurance

                                     -22-
        

<PAGE>
 
referred to in Section 13.1 and shall deliver certificates thereof to Landlord 
prior to their effective date (and with respect to any renewal policy, at least 
10 days prior to the expiration of the existing policy). In the event Tenant 
fails to satisfy its obligations under this Section 13.4, Landlord shall be 
entitled, but shall have no obligation, to effect such insurance and pay the 
premiums therefor, which premiums shall be repayable to Landlord upon written 
demand as Additional Charges. Each insurer mentioned in Section 13.1 shall 
agree, by endorsement on the policy or policies issued by it, or by independent 
instrument furnished to Landlord, that it will give to Landlord 30 days' written
notice before the policy or policies in question shall be altered in any 
material respect, allowed to expire or cancelled. Each such policy shall also 
provide that any loss otherwise payable thereunder shall be payable 
notwithstanding (i) any act or omission of Landlord or Tenant which might, 
absent such provision, result in a forfeiture of all or a part of such insurance
payment, (ii) the occupation or use of the Leased Property for purposes more 
hazardous than those permitted by the provisions of such policy, (iii) any 
foreclosure or other action or proceeding taken by any Facility Mortgagee 
pursuant to any provision of a mortgage, note, assignment or other document 
evidencing or securing a loan upon the happening of an event of default therein 
or (iv) any change in title to or ownership of the Leased Property.

        13.5 Change in Limits. In the event that Landlord shall at any time 
reasonably determine on the basis of prudent industry practice that the 
liability insurance carried by Tenant pursuant to Section 13.1.2 is either 
excessive or insufficient (but only if the liability insurance limit is not less
than $3,000,000 per person or per occurrence), the parties shall endeavor to 
agree on the proper and reasonable limits for such insurance to be carried; and 
such insurance shall thereafter be carried with the limits thus agreed on until 
further changed pursuant to the provisions of this Section 13.5. Notwithstanding
the foregoing, the deductibles for such insurance or the amount of such 
insurance which is self-retained by Tenant shall be as reasonably determined by 
Tenant so long as Tenant can reasonably demonstrate to Landlord its ability to 
satisfy such deductible or amount of such self-retained insurance.

        13.6 Blanket Policy. Notwithstanding anything to the contrary contained 
in this Article 13, Tenant's obligations to carry the insurance provided for 
herein may be brought within the coverage of a so-called blanket policy or 
policies of insurance carried and maintained by Tenant; provided, however, that 
the coverage afforded Landlord shall not be reduced or diminished or otherwise 
be different from that which would exist under a separate policy meeting all 
other requirements of this Lease by reason of the use of such blanket policy of 
insurance, and provided further that the requirements of this Article 13 are 
otherwise satisfied. The amount of the total insurance shall be specified either
(i) in each such "blanket" or umbrella policy or (ii) in a written statement, 
which Tenant shall deliver to Landlord and Facility Mortgagee, from the insurer 
thereunder. A certificate of each such

                                     -23-
<PAGE>
 
"blanket" or umbrella policy shall promptly be delivered to Landlord and 
Facility Mortgagee. If requested by Landlord, Tenant shall provide Landlord with
a certified copy of the "blanket" or umbrella insurance policy.

                ARTICLE 14 - APPLICATION OF INSURANCE PROCEEDS

        14.1 Insurance Proceeds. All proceeds of insurance payable by reason of 
any loss or damage to the Leased Property, or any portion thereof, and insured 
under any policy of insurance required by Article 13 shall (i) if greater than 
$100,000, be paid to Landlord and held by Landlord and (ii) if less than such 
amount, be paid to Tenant and held by Tenant. All such proceeds shall be held in
trust and shall be made available for reconstruction or repair, as the case may 
be, of any damage to or destruction of the Leased Property, or any portion 
thereof.

                14.1.1 Disbursement of Proceeds. Any proceeds held by Landlord
     or Tenant shall be paid out by Landlord or Tenant from time to time for the
     reasonable costs of such reconstruction or repair; provided, however, that
     Landlord shall disburse proceeds subject to the following requirements:

        (i) prior to commencement of restoration, (A) the architects, contracts,
        contractors, plans and specifications for the restoration shall have
        been approved by Landlord, which approval shall not be unreasonably
        withheld or delayed and (B) appropriate waivers of mechanics' and
        materialmen's liens shall have been filed;

        (ii) at the time of any disbursement, subject to Article 12, no
        mechanics' or materialmen's liens shall have been filed against any of
        the Leased Property and remain undischarged, unless a satisfactory bond
        shall have been posted in accordance with the laws of the State;

        (iii) disbursements shall be made as requested by Tenant, not more
        frequently than monthly, upon not less than 15 days' notice in an amount
        not exceeding the cost of the work completed since the last
        disbursement, upon receipt of (A) satisfactory evidence of the stage of
        completion, the estimated total cost of completion and performance of
        the work to date in a good and workmanlike manner in accordance with the
        contracts, plans and specifications, (B) waivers of liens, (C) a
        satisfactory bringdown of title insurance and (D) other evidence of cost
        and payment so that Landlord and Facility Mortgagee can verify that the
        amounts disbursed from time to time are represented by work that is
        completed, in place and free and clear of mechanics' and materialmen's
        lien claims;

                                     -24-
<PAGE>
 
        (iv) each request for disbursement shall be accompanied by a certificate
        of Tenant, signed by the president or a vice president of Tenant,
        describing the work for which payment is requested, stating the cost
        incurred in connection therewith, stating that Tenant has not previously
        received payment for such work and, upon completion of the work, also
        stating that the work has been fully completed and complies with the
        applicable requirements of this Lease;

        (v) to the extent actually held by Landlord and not by a Facility
        Mortgagee, (1) the proceeds shall be held in a separate account and
        shall not be commingled with Landlord's other funds, and (2) interest
        shall accrue on funds so held at the money market rate of interest and
        such interest shall constitute part of the proceeds; and

                14.1.2  Excess Proceeds.  Any excess proceeds of insurance 
     remaining after the completion of the restoration or reconstruction of the
     Leased Property (or in the event neither Landlord nor Tenant is required or
     elects to repair and restore) shall be paid first to Tenant to reimburse
     Tenant for any deductible amount previously paid by Tenant, and the balance
     shall be paid to Landlord and Tenant in like proportions to the value of
     Landlord's interests in the Leased Property and Tenant's interest in
     Tenant's Personal Property and the Tenant Improvements, or any portion
     thereof, as determined under Article 13, upon completion of any such repair
     and restoration except as otherwise specifically provided below in this
     Article 14. All salvage resulting from any risk covered by insurance shall
     belong to Landlord.

        14.2    Reconstruction Covered by Insurance.

                14.2.1  Destruction Rendering Facility Unsuitable for its 
     Primary Use. If during the Term the Leased Property is totally or partially
     destroyed from a risk covered by the insurance described in Article 13 and
     the Facility thereby is rendered Unsuitable For Its Primary Intended Use
     and provided that insurance proceeds are disbursed for that purpose in the
     manner provided in Section 14.1.1, Tenant shall diligently restore the
     Facility to substantially the same condition as existed immediately before
     the damage or destruction; provided, however, if the Facility cannot be
     fully repaired or restored within a 12-month period from the date of the
     damage or destruction to substantially the same condition as existed
     immediately before the damage or destruction, then Tenant may terminate
     this Lease by giving Landlord written notice of such termination within 60
     days after the date of such damage or destruction, and the effective date
     of such termination shall be 30 days following such notice of termination;
     provided, however, if Landlord notifies Tenant in writing within 15 days of
     Landlord's receipt of Tenant's notice of termination that Landlord intends
     to restore the Facility to substantially the same condition as existed
     immediately before the damage and

                                     -25-


<PAGE>
 
        destruction and Landlord diligently commences and prosecutes such
        restoration and completes such restoration within 12 months after the
        date of the damage or destruction, then Tenant's election to terminate
        the Lease shall be deemed rescinded and the Lease shall remain in full
        force and effect. In the event Landlord elects to restore the Facility
        as provided in the immediately preceding sentence, during the period
        from the date of Tenant's notice of termination through the date the
        restoration of the Facility is completed, the Base Rent shall be deemed
        to be zero and Tenant's payment of Rent shall consist only of the
        payment of Additional Rent in accordance with Section 8 of the Basic
        Lease Provisions and the Additional Charges as required by the Detailed
        Lease Provisions. Upon any such termination of the Lease by Tenant or
        upon Landlord's election to restore the Facility as provided in this
        section, Landlord shall be entitled to retain all insurance proceeds,
        grossed up by Tenant to account for the deductible or any self-insured
        retention; provided, further, that Tenant shall be entitled to retain or
        receive all insurance proceeds relating to Tenant's Personal Property
        and the Tenant Improvements.

                        14.2.2 Destruction Not Rendering Facility Unsuitable for
        its Primary Use. If during the Term, the Leased Property is totally or
        partially destroyed from a risk covered by the insurance described in
        Article 13, but the Facility is not thereby rendered Unsuitable For Its
        Primary Intended Use, and provided that insurance proceeds are disbursed
        for that purpose in the manner provided in Section 14.1.1, Tenant shall
        diligently restore the Facility to substantially the same condition as
        existed immediately before the damage or destruction; provided, however,
        Tenant shall not be required to restore Tenant's Personal Property
        and/or any Tenant Improvements if failure to do so does not adversely
        affect the amount of Additional rent payable hereunder. Such damage or
        destruction shall not terminate this Lease; provided further, however,
        if Tenant and Landlord cannot within 12 months after said damage obtain
        all necessary governmental approvals, including building permits,
        licenses, conditional use permits and any certificates of need, after
        diligent efforts to do so in order to be able to perform all required
        repair and restoration work and to operate the Facility for its Primary
        Intended Use in substantially the same manner as immediately prior to
        such damage or destruction, Tenant may terminate this Lease upon 30 days
        prior written notice to Landlord; provided further, however, if Landlord
        notifies Tenant in writing within 15 days of Landlord's receipt of
        Tenant's notice of termination that Landlord intends to restore the
        Facility to substantially the same condition as existed immediately
        before the damage and destruction and Landlord diligently commences and
        prosecutes such restoration and completes such restoration within 90
        days after the date of Tenant's notice of termination, then Tenant's
        election to terminate the Lease shall be deemed rescinded and the Lease
        shall remain in full force and effect. In the event Landlord elects to
        restore the

                                     -26-

<PAGE>
 
        Facility as provided in the immediately preceding sentence, during the
        period from the date of Tenant's notice of termination through the date
        the restoration of the Facility is completed, the Base Rent shall be
        deemed to be zero and Tenant's payment of Rent shall consist only of the
        payment of Additional Rent in accordance with Section 8 of the Basic
        Lease Provisions and the Additional Charges as required by the Detailed
        Lease Provisions. Upon any such termination of the Lease by Tenant or
        opon Landlord's election to restore the Facility as provided in this
        section, Landlord shall be entitled to retain all insurance proceeds,
        grossed up by Tenant to account for the  deductible or any self-
        insured retention; provided, further, that Tenant shall be entitled to
        retain or receive all insurance proceeds relating to (i) Tenant's
        personal Property, (ii) the Tenant Improvements and (iii) subject to
        inclusion in Course Revenue, Tenant's business interruption insurance.

                        14.2.3 Costs of Repair. If Tenant restores the Facility
        as provided in Sections 14.2.1 and 14.2.2 above and the cost of the
        repair or restoration exceeds the amount of proceeds received by
        Landlord or Tenant from the insurance required under Article 13, Tenant
        shall pay for such excess cost of repair or restoration. If Landlord
        restores the Facility as provided in Sections 14.2.1 and 14.2.2 above
        and the cost of the repair or restoration exceeds the amount of proceeds
        received by Landlord as provided in those sections, Landlord shall pay
        for such excess cost of repair or restoration.

                14.3 Reconstruction Not Covered by Insurance. If during the
   Term, the Facility is totally or materially destroyed from a risk not covered
   by the insurance described in Article 13, whether or not such damage or
   destruction renders the Facility Unsuitable For Its Primary Intended Use,
   Tenant shall either (A) restore the Facility, at Tenant's cost, to
   substantially the same condition as existed immediately before the damage or
   destruction, or (B) elect to terminate this Lease upon 60 days prior written
   notice to Landlord; provided, however, if Landlord notifies Tenant in writing
   within 15 days of Landlord's receipt of Tenant's notice of termination that
   Landlord intends to restore the Facility, at Landlord's cost, to
   substantially the same condition as existed immediately before the damage and
   destruction and Landlord diligently commences and prosecutes such restoration
   and completes such restoration within 90 days after the date of Tenant's
   notice of termination, then Tenant's election to terminate the Lease shall be
   deemed rescinded and the Lease shall remain in full force and effect. In the
   event Landlord elects to restore the Facility as provided in the immediately
   preceding sentence, during the period from the date of Tenant's notice of
   termination through the date the restoration of the Facility is completed,
   the Base Rent shall be deemed to be zero and Tenant's payment of Rent shall
   consist only of the payment of Additional Rent in accordance with Section 8
   of the Basic Lease Provisions and the Additional Charges as required by the
   Detailed Lease Provisions.

                                     -27- 

<PAGE>
 
        14.4  Waiver.  Tenant hereby waives any statutory rights of termination 
which may arise by reason of any damage or destruction of the Facility which 
Landlord or Tenant is obligated to restore or may restore under any of the 
provisions of this Lease.

        14.5  Damage Near End of Term.  Notwithstanding any other provision to 
the contrary in this Article 14, if damage to or destruction of the Leased 
Property occurs during the last 24 months of the Term of this Lease, and if such
damage or destruction cannot reasonably be expected to be fully repaired or 
restored prior to the date that is 12 months prior to the end of the 
then-applicable Term, then Tenant shall have the right to terminate the Lease on
30 days' prior notice to Landlord by giving notice thereof to Landlord within 60
days after the date of such damage or destruction.  Upon any such termination, 
Landlord shall be entitled to retain all insurance proceeds, grossed up by 
Tenant to account for the deductible or any self-insured retention; provided, 
however, that, Tenant shall be entitled to retain or receive all insurance 
proceeds relating to (i) Tenant's Personal Property, (ii) Tenant Improvements 
and (iii) subject to the inclusion in Course Revenue, Tenant's business 
interruption insurance.


                           ARTICLE 15 - CONDEMNATION

        15.1  Total Taking.  If at any time during the Term the Leased Property 
is totally and permanently taken by Condemnation, this Lease shall terminate on 
the Date of Taking and Tenant shall promptly pay all outstanding rent and other 
charges through the date of termination.

        15.2  Partial Taking.  If a portion of the Leased Property is taken by 
Condemnation, this Lease shall remain in effect if the Facility is not thereby 
rendered Unsuitable For Its Primary Intended Use, but if the Facility is thereby
rendered Unsuitable For Its Primary Intended Use, this Lease shall terminate on
the Date of Taking.

        15.3  Restoration.  If there is a partial taking of the Leased Property
and this Lease remains in full force and effect pursuant to Section 15.2, 
Landlord at its cost shall accomplish all necessary restoration up to but not 
exceeding the amount of the Award payable to Landlord, as provided herein.  If 
Tenant receives an Award under Section 15.4, Tenant shall repair or restore any 
Tenant Improvements up to but not exceeding the amount of the Award payable to 
Tenant therefor.

        15.4  Award-Distribution.  The entire Award shall belong to and be paid 
to Landlord, except that, subject to the rights of the Facility Mortgagee, 
Tenant shall be entitled to receive from the Award, if and to the extent such 
Award specifically includes such items, a sum attributable to the value, if any,
of: (i) any Tenant Improvements and (ii) the leasehold interest of Tenant under 
this Lease; provided, however, that if the amount received by Landlord and the 
Facility Mortgagee is less than the Condemnation


                                     -28-
<PAGE>
 
Threshold, then the amount of the Award otherwise payable to Tenant for the
value of its leasehold interest under this Lease (and not any other funds of
Tenant) shall instead be paid over to Landlord up to the amount of the
shortfall.

        15.5 Temporary Taking. The taking of the Leased Property, or any part
thereof, by military or other public authority shall constitute a taking by
Condemnation only when the use and occupancy by the taking authority has
continued for longer than six months. During any such six month period, which
shall be a temporary taking, all the provisions of this Lease shall remain in
full force and effect with no abatement of rent payable by Tenant hereunder. In
the event of any such temporary taking, the entire amount of any such Award made
for such temporary taking allocable to the Term of this Lease, whether paid by
way of damages, rent or otherwise, shall be paid to Tenant, provided however
that notwithstanding the preceding, to the extent that Tenant successfully
prevails against the condemning authority on a claim that the Leased Property
would have generated a given level of revenues which would have produced
Additional Rent during the period of such taking, then the appropriate portion
of the Award which is attributable to revenue that would have generated
Additional Rent for said period shall be paid to Landlord, if due and payable,
as Additional Rent.

                         ARTICLE 16 - EVENT OF DEFAULT

        16.1 Events of Default. If any one or more of the following events
(individually, an "Event of Default") shall occur:

        (a) if Tenant shall fail to make payment of the rent payable by Tenant
        under this Lease when the same becomes due and payable and such failure
        is not cured by Tenant within a period of seven days after receipt by
        Tenant of notice thereof from Landlord; provided, however, that such
        notice shall be in lieu of and not in addition to any notice required
        under applicable law;

        (b) if Tenant shall fail to obtain, maintain or replace a Letter of
        Credit as required by Article 25 and such default continues for five (5)
        business days after written notice to Tenant;

        (c) if, other than as a result of Unavoidable Delays, Tenant shall fail
        to observe or perform any material term, covenant or condition of this
        Lease and such failure is not cured by Tenant within a period of 30 days
        after receipt by Tenant of notice thereof from Landlord, unless such
        failure cannot with due diligence be cured within a period of 30 days,
        in which case such failure shall not be deemed to continue if Tenant
        proceeds promptly and with due diligence to cure the failure and
        diligently completes the curing thereof; provided further, however, that
        the cure period shall not extend beyond 30 days as otherwise provided by
        this Section

                                     -29_
<PAGE>
 
        16.1(c) if the facts or circumstances giving rise to the default are
        creating a further harm to Landlord or the Leased Property and Landlord
        makes a good faith determination that Tenant is not undertaking
        remedial steps that Landlord would cause to be taken if this Lease were
        than to terminate.

        (d)     if Tenant shall:

                (i)     admit in writing its inability to pay its debts 
                generally as they become due,

                (ii)    file a petition in bankruptcy or a petition to take 
                advantage of any insolvency act,


                (iii)   make an assignment for the benefit of its creditors,

                (iv)    be unable to pay its debts as they mature,

                (v)     consent to the appointment of a receiver of itself or of
                the whole or any substantial part of its property, or

                (vi)    file a petition or answer seeking reorganization or
                arrangement under the Federal bankruptcy laws or any other
                applicable law or statute of the United States of America or any
                state thereof;

        (e)   if Tenant shall, on a petition in bankruptcy filed against it, be
        adjudicated as bankrupt or a court of competent jurisdiction shall enter
        and order or decree appointing, without the consent of Tenant, a
        receiver of Tenant or of the whole or substantially all of its property,
        or approving a petition filed against it seeking reorganization or
        arrangement of Tenant under the Federal bankruptcy laws or any other
        applicable law or statute of the United States of America or any state
        thereof, and such judgment, order or decree shall not be vacated or set
        aside or stayed within 60 days from the date of the entry thereof;

        (f)   if Tenant shall be liquidated or dissolved, or shall begin 
        proceedings toward such liquidation or dissolution;

        (g)   if the estate or interest of Tenant in the Leased Property or any
        part thereof shall be levied upon or attached in any proceeding and the
        same shall not be vacated or discharged within the later of 90 days
        after commencement thereof or 30 days after receipt by Tenant of notice
        thereof from Landlord (unless Tenant shall be contesting such lien or
        attachment in accordance with Article 12); provided, however, that such
        notice shall be


                                     -30-


<PAGE>
 
                in lieu of and not in addition to any notice required under
                applicable law;
 
                (h) if, except as a result of damage, destruction or partial or
                complete Condemnation or other Unavoidable Delays, Tenant
                voluntarily ceases operations on the Leased Property for a
                period in excess of 45 consecutive days other than relating to
                the closure of up to nine holes at a time or the clubhouse in
                order for Tenant to carry out renovations so long as Tenant is
                diligently performing such renovations;

                (i) any representation or warranty made by Tenant herein or in
                any certificate, demand or request made pursuant hereto proves
                to be incorrect, now or hereafter, in any material respect and
                any adverse effect on Landlord of any such misrepresentation or
                breach of warranty has not been corrected to Landlord's
                satisfaction within 30 days after Tenant becomes aware of, or is
                notified by Landlord of the fact of, such misrepresentation or
                breach of warranty; or

                (j) with respect to any of the Other Property Leases, either an
                Event of Default has occurred and is continuing after the
                expiration of the applicable cure period or such leases have
                been terminated by reason of an Event of Default.

                THEN, Landlord may terminate this Lease by giving Tenant not
     less than 10 days' notice (or no notice for clauses (d), (e) and (f) with
     respect to Tenant) of such termination and upon the expiration of the time
     fixed in such notice, the Term shall terminate and all rights of Tenant
     under this Lease shall cease. Landlord shall have all rights at law and in
     equity available to Landlord as a result of Tenant's breach of this Lease.


                16.2 Payment of Costs. Tenant shall, to the extent permitted by
     law, pay as Additional Charges all costs and expenses incurred by or on
     behalf of Landlord, including reasonable attorneys' fees and expenses, as a
     result of any Event of Default hereunder.

                16.3 Exceptions. No Event of Default (other than a failure to
     make payment of money or post a Letter of Credit; if required hereunder)
     shall be deemed to exist under clause (c) of Section 16.1 during any time
     the curing thereof is prevented by an Unavoidable Delay; provided that,
     upon the cessation of such Unavoidable Delay, Tenant shall remedy such
     default without further delay.

                16.4 Certain Remedies. If an Event of Default shall have
      occurred (and the event giving rise to such Event of Default has not been
      cured within the curative period relating thereto as set forth in Section
      16.1) and be continuing, whether or not this


                                     -31-

                




<PAGE>
 
Lease has been terminated pursuant to Section 16.1, Tenant shall, to the extent 
                                      ------------
permitted by law, if required by Landlord so to do, immediately surrender to 
Landlord the Leased Property pursuant to the provisions of Section 16.1 and 
                                                            ------------
quit the same and Landlord may enter upon and repossess the Leased Property by 
reasonable force, summary proceedings, ejectment or otherwise, and may remove 
Tenant and all other Persons and any and all Tenant's Personal Property from the
Leased Property subject to any requirement of law.

          16.5  Damages. None of (a) the termination of this Lease pursuant to 
                -------
Section 16.1, (b) the repossession of the Leased Property, (c) the failure of
------------
Landlord, notwithstanding reasonable good faith efforts, to relet the Leased
Property, (d) the reletting of all or any portion thereof, not (e) the failure
of Landlord to collect or receive any rentals due upon any such reletting, shall
relieve Tenant of its liability and obligations hereunder, all of which shall
survive any such termination, repossession or reletting; provided that Landlord
shall use reasonable efforts to mitigate its damages hereunder. In the event of
any such termination, Tenant shall forthwith pay to Landlord all Rent due and
payable with respect to the Leased Property to, and including, the date of such
termination. Thereafter, Tenant shall forthwith pay to Landlord, at Landlord's
option, as and for liquidated and agreed current damages for Tenant's default,
either:

          (a)  the sum of:

               (i)     the worth at the time of award of the unpaid Rent which
               had been earned at the time of termination,

               (ii)    the worth at the time of award of the amount by which the
               unpaid Rent which would have been earned after termination until
               the time of award exceeds the amount of such rental loss that
               Tenant proves could have been reasonably avoided,

               (iii)   the worth at the time of award of the amount by which 
               the unpaid Rent for the balance of the Term after the time of
               award exceeds the amount of such rental loss that Tenant proves
               could be reasonably avoided, and

               (iv)    any other amount necessary to compensate Landlord for all
               the detriment proximately caused by Tenant's failure to perform
               its obligations under this Lease or which in the ordinary course
               of things would be likely to result therefrom.

          In making the above determinations, the worth at the time of the award
          shall be determined by the court having jurisdiction thereof using
          the San Francisco Federal Funds Rate plus one percent and the
          Additional Rent shall be deemed to be the same as for the then-current
          Fiscal Year or, if not determinable, the immediately preceding
          
                                     -32-
<PAGE>
 
          Fiscal Year, for the remainder of the Term, or such other amount as 
          either party shall prove reasonably could have been earned during the
          remainder of the Term or any portion thereof; or

          (b)  without termination of Tenant's right to possession of the Leased
          Property, each installment of said Rent and other sums payable by
          Tenant to Landlord under the Lease as the same becomes due and
          payable, which Rent and other sums shall bear interest at the Overdue
          Rate from the date when due until paid, and Landlord may enforce, by
          action or otherwise, any other term or covenant of this Lease.

          16.6   Additional Remedies. Landlord has all other remedies that may 
                 -------------------
be available under applicable law.

          16.7   Appointment of Receiver. Upon the entry of a court order that 
                 -----------------------    
an Event of Default has occurred, Landlord shall be entitled, as a matter of 
right, to the appointment of a receiver or receivers acceptable to Landlord of 
the Leased Property and the Facility and of the revenues, earnings, income, 
products and profits thereof, pending such proceedings, with such powers as the 
court making such appointment shall confer.

          16.8   Application of Funds. Any payments received by Landlord under
                 -------------------- 
any of the provisions of this Lease during the existence or continuance of any
Event of Default (and such payment is made to Landlord rather than Tenant due to
the existence of an Event of Default) shall be applied to Tenant's obligations
in the order which Landlord may determine or as may be prescribed by the laws of
the State.

          16.9   Impounds. Landlord shall have the right during the continuance
                 --------
of an Event of Default to require Tenant to pay to Landlord an additional
monthly sum (each an "Impound Payment") sufficient to pay the Impound Charges
                      ---------------
(as hereinafter defined) as they become due. As used herein, "Impound Charges"
                                                              ---------------
shall mean real estate taxes on the Leased Property or payments in lieu thereof
and premiums on any insurance required by this Lease. Landlord shall determine
the amount of the Impound Charges and of each Impound Payment. The Impound
Payments shall be held in a separate account and shall not be commingled with
other funds of Landlord and interest thereon shall be held for the account of
Tenant. Landlord shall apply the Impound Payments to the payment of the Impound
Charges on their respective due dates. Any Impound Payments which have not been
applied to Impound Charges shall be released to Tenant within 30 days after the
Event of Default is cured. If at any time the Impound Payments theretofore paid
to Landlord shall be insufficient for the payment of the Impound Charges,
Tenant, within 10 days after Landlord's demand therefor, shall pay the amount of
the deficiency to Landlord.

                                     -33-
<PAGE>
 
          16.10 Breach by Landlord.  It shall be a breach of this Lease if 
                ------------------
Landlord shall fail to observe or perform any material term, covenant or 
condition of this Lease on its part to be performed and such failure shall 
continue for a period of 30 days after notice thereof from Tenant, unless such 
failure shall continue for a period of 30 days after notice thereof from Tenant,
unless such failure cannot with due diligence be cured within a period of 30 
days, in which case such failure shall not be deemed to continue if Landlord, 
within said 30-day period, proceeds promptly and with due diligence to cure the 
failure and diligently completes the curing thereof. The time within which 
Landlord shall be obligated to cure any such failure shall also be subject to 
extension of time due to the occurrence of any Unavoidable Delay.

            ARTICLE 17 - LANDLORD'S RIGHT TO CURE TENANT'S DEFAULT
            ------------------------------------------------------

          If Tenant shall fail to make any payment or to perform any act 
required to be made or performed under this Lease, and to cure the same within 
the relevant time periods provided in Section 16.1, Landlord, after notice to 
                                      ------------
and demand upon Tenant, and without waiving or releasing any obligation or 
default, may (but shall be under no obligation to) at any time thereafter make 
such payment or perform such act for the account and at the expense of Tenant. 
Landlord may, to the extent permitted by law, enter upon the Leased Property for
such purpose and take all such action thereon as, in Landlord's opinion, may be 
necessary or appropriate therefor. No such entry shall be deemed an eviction of 
Tenant. All sums so paid by Landlord and all costs and expenses (including 
reasonable attorneys' fees and expenses, to the extent permitted by law) so 
incurred, together with a late charge thereon at the Overdue Rate from the date 
on which such sums or expenses are paid or incurred by Landlord, shall be paid 
by Tenant to Landlord on demand. The obligations of Tenant and rights of 
Landlord contained in this Article 17 shall survive the expiration or earlier 
                           ----------
termination on this Lease.

                        ARTICLE 18 - LEGAL REQUIREMENTS
                        -------------------------------

          Subject to Article 12 regarding permitted contests, Tenant, at its 
                     ----------
expense, shall promptly (a) comply with all Legal Requirements and Insurance 
Requirements in respect of the use, operation, maintenance, repair and 
restoration of the Leased Property, whether or not compliance therewith shall 
require structural changes in any of the Leased Improvements or interfere with 
the use and enjoyment of the Leased Property; and (b) procure, maintain and 
comply with all licenses and other authorizations required for any use of the 
Leased Property then being made, and for the proper erection, installation, 
operation and maintenance of the Leased Property or any part thereof.

                           ARTICLE 19 - HOLDING OVER
                           -------------------------

          If Tenant shall for any reason, other than a valid court order, remain
in possession of the Leased Property after the expiration of the Term or earlier
termination of the Term hereof, such possession shall be as a month-to-month 
tenant during which

                                     -34-
<PAGE>
 
time Tenant shall pay as rental each month, 125% of the aggregate of (i) 
one-twelfth of the aggregate Base Rent and Additional Rent payable with respect
to the last Fiscal Year of the preceding Term; (ii) all Additional Charges 
accruing during the month; and (iii) all other sums, if any, payable by Tenant 
pursuant to the provisions of this Lease with respect to the Leased Property. 
During such period of month-to-month tenancy, Tenant shall be obligated to 
perform and observe all of the terms, covenants and conditions of this Lease, 
but shall have no rights hereunder other than the right, to the extent given by 
law to month-to-month tenancies, to continue its occupancy and use of the Leased
Property. Nothing contained herein shall constitute the consent, express or 
implied, of Landlord to the holding over of Tenant after the expiration or 
earlier termination of this Lease.

                           ARTICLE 20 - RISK OF LOSS
                           -------------------------

          During the Term of this Lease, the risk of loss or of decrease in the 
enjoyment and beneficial use of the Leased Property as a consequence of the 
damage or destruction thereof by fire, the elements, casualties, thefts, riots, 
wars or otherwise, or in consequence of foreclosures, attachments, levies or 
executions (other than by Landlord or Landlord's employees, authorized agents or
contractors, and those claiming from, through or under Landlord) is assumed by 
Tenant. In the absence of Landlord's negligence (and subject to Article 8), acts
                                                                ---------
of Landlord or Landlord's employees, authorized agents or contractors, or those 
claiming from, through or under Landlord, or breach of this Lease by Landlord,
which in any of the foregoing cases causes such loss or decrease in the
enjoyment and beneficial use of the Leased Property, (i) Landlord shall in no
event be answerable or accountable for any of the events mentioned in the first
sentence of this Article 20 and (ii) none of such events shall entitle Tenant to
                 ----------
any abatement of Rent except as otherwise provided in the Lease.

                         ARTICLE 21 - INDEMNIFICATION
                         ----------------------------

          21.1  Tenant's Indemnification of Landlord.  Subject to Article 8, 
                ------------------------------------              ---------
Tenant will protect, indemnify, save harmless and defend Landlord from and 
against all liabilities, obligations, claims, damages, penalties, causes of 
action, costs and expenses (including reasonable attorneys' fees and expenses) 
(collectively, "Claims"), asserted against Landlord by reason of:
                ------

          (a)   any accident, injury to or death of Persons or loss of or damage
          to property occurring on or about the Leased Property or adjoining
          sidewalks during the Term of this Lease, including, but not limited
          to, any accident, injury to or death of Person or loss of or damage to
          property resulting from golf balls, golf clubs, golf shoes, lawn
          mowers or other gardening devices, golf carts, tractors or other
          motorized vehicles present on or adjacent to the Leased Property;

                                     -35-
<PAGE>
 
          (b)   any use, misuse, non-use, condition, maintenance or repair by 
          Tenant of the Leased Property;

          (c)  any Impositions (which are the obligations of Tenant to pay 
          pursuant to the applicable provisions of this Lease);

          (d)  any failure on the part of Tenant to perform or comply with any 
          of the terms of this Lease;

          (e)  the non-performance of any of the terms and provisions of any and
          all existing and future subleases of the Leased Property to be
          performed by the landlord (Tenant) thereunder; and

          (f)  any Claims Landlord may incur or suffer as a result of any 
          permitted contest by Tenant pursuant to Article 12.
                                                  ----------

          21.2  Landlord's Indemnification of Tenant.  Subject to Article 8, 
                ------------------------------------              ---------
Landlord shall protect, indemnify, save harmless and defend Tenant from and 
against all Claims imposed upon or incurred by, or asserted against Tenant as a 
result of (i) Landlord's or Landlord's employees, authorized agents' or 
contractors' negligence, or (ii) any acts of Landlord or Landlord's employees, 
authorized agents or contractors, or those claiming from, through or under 
Landlord (other than such acts which are authorized under the Lease or 
applicable law).

          21.3  Mechanics of Indemnification.  As soon as reasonably practicable
                ----------------------------
after receipt by the indemnified party of notice of any liability or claim 
incurred by or asserted against the indemnified party that is subject to 
indemnification under this Article 21, the indemnified party shall give notice 
                           ----------
thereof to the indemnifying party. The indemnified party may at its option 
demand indemnity under this Article 21 as soon as a claim has been made in 
                            ----------
writing by a third party, regardless of whether an actual loss has been 
suffered, so long as the indemnified party shall in good faith determine that 
such claim is not frivolous and that the indemnified party may be liable for, or
otherwise incur, a loss as a result thereof and shall give notice of such
determination to the indemnifying party. The indemnified party shall permit the
indemnifying party, at its option and expense, to assume the defense of any such
claim by counsel selected by the indemnifying party and reasonably satisfactory
to the indemnified party, and to settle or otherwise dispose of the same;
provided, however, that the indemnified party may at all times participate in
--------  -------
such defense at its expense; and provided further, however, that the
                                 -------- -------  -------
indemnifying party shall not, in defense of any such claim, except with the
prior written consent of the indemnified party, consent to the entry of any 
judgment or to enter into any settlement that does not include as an 
unconditional term thereof the giving by the claimant or plaintiff in question 
to the indemnified party and its affiliates a release of all liabilities in 
respect of such claims, or that does not result only in the payment of money 
damages by the 

                                     -36-
<PAGE>
 
indemnifying party. If the indemnifying party shall fail to undertake such 
defense within 30 days after such notice, or within such shorter time as may be 
reasonable under the circumstances, then the indemnified party shall have the 
right to undertake the defense, compromise or settlement of such liability or 
claim on behalf of and for the account of the indemnifying party.

          21.4  Survival of Indemnification Obligations.  Tenant's or Landlord's
                ---------------------------------------
liability for a breach of the provisions of this Article 21 arising during the 
                                                 ----------
Term hereof shall survive any termination of this Lease.

                    ARTICLE 22 - SUBLETTING AND ASSIGNMENT
                    --------------------------------------

          22.1  Prohibition Against Subletting and Assignment.  Subject to 
                ---------------------------------------------
Sections 22.3 and 22.6, Tenant shall not, without the prior written consent of 
-------------     ----
Landlord (which consent Landlord may grant or withhold in its sole and absolute 
discretion), assign, mortgage, pledge, hypothecate, encumber or otherwise 
transfer (except to an Affiliate of Tenant) the Lease or any interest therein, 
all or any part of the Leased Property or suffer or permit the Lease or the 
leasehold estate created hereby or thereby or any other rights arising under the
Lease to be assigned, transferred, mortgaged, pledged, hypothecated or 
encumbered, in whole or in part, whether voluntarily, involuntarily or by 
operation of law. For purposes of this Section 22.1, an assignment of the Lease 
                                       ------------
shall be deemed to include any Change of Control of Tenant, as if such Change of
Control were an assignment of the Lease. Notwithstanding the first sentence of
this Section 22.1, an assignment of this Lease in connection with the sale,
     ------------
conveyance or other transfer of all or substantially all of the assets of Tenant
(whether by operation of law or otherwise) shall be treated as a Change in
Control (and therefore will be permitted if the requirements of Section 22.2.1
                                                                --------------
through Section 22.2.3 hereof are met).
        --------------

          22.2  Changes of Control.  A Change of Control requiring the consent 
                ------------------
of Landlord shall mean:

          (a)   the issuance and/or sale by Tenant or the sale by any
          stockholder of Tenant of a Controlling interest in Tenant to a Person
          other than an Affiliate of Tenant, other than in either case a
          distribution to the public pursuant to an effective registration
          statement under the Securities Act of 1933, as amended (a "Registered
                                                                     ----------
          Offering");
          --------

          (b)   the sale, conveyance or other transfer of all or substantially
          all of the assets of Tenant (whether by operation of law or
          otherwise), which may include a transfer of assignment of this Lease;

          (c)   any transaction pursuant to which Tenant is merged with or
          consolidated into another entity (other than an entity owned and
          Controlled by an Affiliate of Tenant), and Tenant is not the surviving
          entity;

                                     -37-
<PAGE>
 
provided, however, that notwithstanding the foregoing any such transaction shall
-----------------
not be deemed a Change of Control if each of the following conditions are met:

          22.2.1    Financial Covenants.  Unless a Letter of Credit in an amount
                    -------------------
specified in Section 25.3 is posted in favor of Landlord concurrently with any 
             ------------
such consolidation, merger, sale or conveyance, the Person formed by or 
surviving such transaction shall have (i) a Tangible Net Worth not less than 
$25,000,000 and (ii) a Fixed Charge Coverage Ratio of not less than 1.5 to 1.0 
for two consecutive Fiscal Quarters.

          22.2.2    Operating Standards.  The surviving entity shall operate the
                    -------------------
Leased Property at a standard at least as high as that operated by Tenant prior 
to the Change of Control.

          22.2.3    Commitment to the Golf Industry.  Immediately after such 
                    -------------------------------
consolidation, merger, sale or conveyance, the surviving entity and its 
Affiliates shall have not less than 12 total golf courses (or less if acceptable
to Landlord) under management or lease, which minimum number shall be maintained
for not less than three years after the Change of Control.

          22.3   Subleases.
                 ---------

          22.3.1    Permitted Subleases.  Tenant shall, without Landlord's prior
                    -------------------
approval, be permitted to sublease portions of the Leased Property to 
concessionaires or licensees to:

          (a)    operate golf professionals' shops;

          (b)    operate golf driving ranges;

          (c)    provide golf lessons;

          (d)    operate restaurants;

          (e)    operate bars; and

          (f)    operate any other portions (but not the entirety) of the Leased
          Property customarily associated with or incidental to the operation of
          the Golf Course.

          22.3.2    Terms of Sublease.  Each sublease of any of the Leased 
                    -----------------
Property shall be subject and subordinate to the provisions of this Lease. No 
sublease made as permitted by Section 22.3.1 shall affect or reduce any of the 
                              --------------
obligations of Tenant hereunder, and all such obligations shall continue in full
force and effect as if no sublease had been made. No sublease shall impose any 
additional obligations on Landlord under this Lease.

          22.3.3    Copies.  Tenant shall, within 10 days after the execution 
                    ------
and delivery of any sublease permitted by Section 22.3.1, deliver a duplicate 
                                          --------------
original thereof to Landlord.

                                     -38-
<PAGE>
 
          22.3.4    Assignment of Rights in Subleases.  As security for 
                    ---------------------------------
performance of its obligations under this Lease, Tenant hereby grants, conveys 
and assigns to Landlord all right, title and interest of Tenant in and to all 
subleases now in existence or hereinafter entered into for any or all of the 
Leased Property, and all extensions, modifications and renewals thereof and all 
rents, issues and profits therefrom. Landlord hereby grants to Tenant a license 
to collect and enjoy all rents and other sums of money payable under any 
sublease of any of the Leased Property; provided, however, that Landlord shall 
have the absolute right at any time after the occurrence and continuance of an 
Event of Default upon notice to Tenant and any subtenants to revoke said license
and to collect such rents and sums of money and to retain the same. Tenant shall
not (i) after the occurrence and continuance of an Event of Default, consent to,
cause or allow any material modification or alteration of any of the terms, 
conditions or covenants of any of the subleases or the termination thereof, 
without the prior written approval of Landlord nor (ii) accept any rents (other 
than customary security deposits) more than 90 days in advance of the accrual 
thereof nor permit anything to be done, the doing of which, nor omit or refrain 
from doing anything, the omission of which, will or could be a breach of or 
default in the terms of any of the subleases.

          22.3.5    Licenses, Etc.  For purposes of Sections 22.1, 22.3 and 
                    -------------                   -----------------------
22.5, subleases shall be deemed to include any licenses, concession 
----
arrangements, management contracts or other arrangements relating to the 
possession or use of all or any part of the Leased Property.

          22.4      Assignment.  No assignment shall in any way impair the 
                    ----------
continuing primary liability of Tenant hereunder, and no consent to any 
assignment in a particular instance shall be deemed to be a waiver of the 
prohibition set forth in this Article 22. Any assignment shall be solely of 
                              ----------
Tenant's entire interest in this Lease. Any assignment or other transfer of all 
or any portion of Tenant's interest in the Lease in contravention of this 
Article 22 shall be voidable at Landlord's option.
----------

          22.5      REIT Limitations.  Anything contained in this Lease to the 
                    ----------------
contrary notwithstanding, Tenant shall not (i) sublet or assign the Leased 
Property or this Lease on any basis such that the rental or other amounts to be 
paid by the sublessee or assignee thereunder would be based, in whole or in 
part, on the income or profits derived by the business activities of the 
sublessee or assignee; (ii) sublet or assign the Leased Property or this Lease 
to any person that Landlord owns, directly or indirectly (by applying 
constructive ownership rules set forth in Section 856(d)(5) of the Code), a 10% 
or greater interest in; or (iii) sublet or assign the Leased Property or this 
Lease in any other manner or otherwise derive any income which could cause any 
portion of the amounts received by Landlord pursuant to this Lease or any 
sublease to fail to qualify as "rents from real property" within the meaning of 
Section 856(d) of the Code, or which could cause any other income received by 
Landlord to fail to qualify as income described in Section 856(c)(2) of the 
Code. The require-

                                     -39-
<PAGE>
 
ments of this Section 22.5 shall likewise apply to any further subleasing by any
              ------------
subtenant.

          22.6   Leasehold Mortgages.  Tenant and every successor and assign of 
                 -------------------
Tenant is hereby given the right by Landlord, with Landlord's prior written 
consent which shall not be unreasonably withheld or delayed, to mortgage its 
interest in this Lease and assign its interest in this Lease as collateral 
security for such mortgage, upon the conditions set forth in this Section 22.6. 
                                                                  ------------
All rights acquired under such mortgage shall be subject to each and all of the 
covenants, conditions and restrictions set forth in this Lease, and to all 
rights and interests of Landlord under this Lease, none of which is or shall be 
waived by Landlord by reason of the rights given Tenant to mortgage its interest
in this Lease, except as expressly provided in this Section 22.6. The mortgagee 
                                                    ------------
or beneficiary of any such leasehold mortgage or assignment shall be an 
Institution. For such purposes of this Section 22.6, an "Institution" shall mean
                                       ------------      -----------
a bank, savings and loan association, trust company, insurance company, public 
pension fund or retirement fund, or any subsidiary of any of the foregoing, or 
any other entity or governmental agency regularly engaged in commercial lending.
If Tenant and/or Tenant's successors and assigns shall mortgage all or part of 
its interest in this Lease and if the holder of such mortgage shall, within 
thirty (30) days of its execution, send to Landlord a true copy thereof together
with written notice specifying the name and address of the mortgagee and the 
pertinent recording data with respect to such mortgage, Landlord agrees that so 
long as the leasehold mortgage remains unsatisfied of record or until written 
notice of satisfaction is given by the holder to Landlord, the following 
provisions shall apply:

               (a)  Mortgagee Consent.  There shall be no cancellation,
                    -----------------
          surrender or modification of this Lease by joint action of Landlord
          and Tenant without the prior written consent of the leasehold
          mortgagee.

               (b)  Notices to Mortgagee.  Landlord shall, upon serving Tenant 
                    --------------------
          with any notice of default, simultaneously serve a copy of such notice
          upon the holder of the leasehold mortgage. The leasehold mortgagee
          shall have the same period, after service of such notice upon it, to
          remedy or cause to be remedied the defaults complained of, and
          Landlord shall accept such leasehold mortgagee's acts if they had been
          performed by Tenant.

               (c)  Insurance.  Landlord agrees that the name of the leasehold
                    ---------
          mortgagee may be added to the "Loss Payable Endorsement" of any and
          all insurance policies required to be carried by Tenant under this
          Lease on the condition that the insurance proceeds be applied in the
          manner specified in this Lease and that the leasehold mortgage or
          collateral document so provide.

               (d)  New Lease.  Landlord agrees that in the event of termination
                    ---------
          of this Lease by reason of any default by

                                     -40-
<PAGE>
 
          Tenant, Landlord will enter into a new lease for the Leased Property
          with a nominee acceptable to Landlord for the remainder of the Term
          effective as of the date of such termination, at the Base Rent,
          Additional Rent and Additional Charges, and upon all of the terms,
          provisions, covenants and agreements contained in this Lease, subject
          only to the rights, if any, of the parties then in possession of any
          part of the Leased Property, provided:

                    1.   The nominee shall make written request upon Landlord
                    for the new lease within fifteen (15) days after the date of
                    termination and the written request shall be accompanied by
                    any then due payment of Base Rent, Additional Rent and
                    Additional Charges under this Lease; and the nominee shall
                    execute and deliver the new lease within fifteen (15) days
                    after Landlord as delivered it.

                    2.   The nominee shall pay to Landlord, at the time of
                    execution and delivery of the new lease, any and all sums
                    which would then be due pursuant to this Lease but for such
                    termination and, in addition thereto, any reasonable
                    expenses, including reasonable attorney's fees, which
                    Landlord shall have incurred by reason of such default,
                    including the costs of reviewing the financials of the
                    proposed nominee, and the negotiation, approval and
                    recording of the new lease.

                    3. The nominee shall perform and observe all covenants in
                    this Lease to be performed by Tenant and shall further
                    remedy any other conditions which Tenant was obligated to
                    perform under the terms of this Lease.

                    4.   Landlord shall not warrant possession of the Leased
                    Property to Tenant or the leasehold mortgagee under the new
                    lease.

                    5.   The new lease shall be expressly made subject to the
                    rights, if any, of Tenant under this Lease.

                    6.   The tenant under the new lease shall have the same
                    right, title and interest in and to the Leased Property as
                    Tenant has under this Lease.

               (e)  Confirming Documentation.  Landlord shall, upon request, 
                    ------------------------
          execute, acknowledge and deliver to each leasehold mortgagee an
          agreement prepared at the sole cost and expense of Tenant, in form
          satisfactory to the leasehold mortgagee and to Landlord, between
          Landlord,

                                     -41-
<PAGE>
 
          Tenant and the leasehold mortgagee confirming the provisions of this 
          Section 22.6. Any additional reasonable costs incurred by Landlord in
          ------------
          connection with the agreement, including reasonable attorneys fees,
          shall be paid by Tenant or the leasehold mortgagee.

          The term "mortgage," as used in this Section 22.6, shall including 
                    --------                   ------------
whatever security instruments are used in the State of South Carolina, as well 
as financing statements, security agreements and other documentation required 
pursuant to the Uniform Commercial Code.

     ARTICLE 23 - OFFICER'S CERTIFICATES AND OTHER STATEMENTS
     --------------------------------------------------------

          23.1   Officer's Certificates.  At any time, and from time to time 
                 ----------------------
upon receipt of not less than 10 days' prior written request by either party, 
the other party will furnish to the requesting party an Officer's Certificate 
certifying that:

          (a)    this Lease is unmodified and in full force and effect (or that 
          this Lease is in full force and effect as modified and setting forth
          the modifications);

          (b)    the dates to which the Rent has been paid;

          (c)    whether or not to the best knowledge of the certifying party, 
          the other party is in default in the performance of any covenant,
          agreement or condition contained in this Lease and, if so, specifying
          each such default of which the certifying party may have knowledge;

          (d)    that, except as otherwise specified, there are no proceedings 
          pending or, to the knowledge of the signatory, threatened, against the
          certifying party before or by any court or administrative agency
          which, if adversely decided, would materially and adversely affect the
          financial condition and operations of the certifying party; and

          (e)    responding to such other questions or statements of fact as the
          requesting party shall reasonably request.

          The failure of either party to deliver such statement within such time
constitute an acknowledgment by it that this Lease is unmodified and in full 
force and effect except as may be represented to the contrary by the requesting 
party, the requesting party is not in default in the performance of any 
covenant, agreement or condition contained in this Lease and the other matters 
set forth in such request, if any, are true and correct. Any such certificate 
furnished pursuant to this Section 23.1 may be relied upon by the requesting 
                           ------------
party.

          23.2   Annual Financial Statements of Tenant.  Tenant will furnish to 
                 -------------------------------------
Landlord, within 90 days after the end of Tenant's fiscal year, a copy of its 
audited consolidated balance sheet as of

                                     -42-
<PAGE>
 
the end of such fiscal year, and related audited consolidated statement of 
income and statement of cash flows for such fiscal year (each with footnotes), 
prepared by a nationally recognized accounting firm in accordance with generally
accepted accounting principles applied on a basis consistently maintained
throughout the period involved. All annual financial statements shall be
accompanied by a certificate of an officer and the chief accounting officer of
Tenant delivered with such statements, stating (i) that the officers know of no
Event of Default, or event which, upon notice or the passage of time or both,
would become an Event of Default, which has occurred and is continuing,
under this Lease or, if any such event has occurred or is continuing, specifying
the nature and period of existence thereof and what action Tenant has taken or
proposes to take with respect thereto, and (ii) except as otherwise specified in
such certificate, that to the best of such officers' knowledge, Tenant has
fulfilled all of its obligations under this Lease which are required to be
fulfilled on a prior date to such certificate.

          23.3   Quarterly Financial Statements of Tenant.  Tenant will furnish 
                 ---------------------------------------
to Landlord, within 45 days after the end of each of the first three fiscal
quarters of Tenant's fiscal year, a copy of its unaudited consolidated balance
sheet as of the end of such fiscal quarter, and related unaudited consolidated
statement of income and statement of cash flows for such fiscal quarter (each
with footnotes), prepared in accordance with generally accepted accounting
principles applied on a basis consistently maintained throughout the period
involved and certified as true and correct by the Chief Financial Officer of
Tenant. All quarterly financial statements shall be accompanied by a certificate
of an officer and the chief accounting officer of Tenant, delivered with such
statements, stating (i) that the officers know of no Event of Default, or event
which, upon notice or the passage of time or both, would become an Event of
Default, which as occurred and is continuing under the Lease or, if any such
event has occurred or is continuing, specifying the nature and period of
existence thereof and what action Tenant has taken or proposes to take with
respect thereto, (ii) except as otherwise specified in such certificate, that to
the best of such officers' knowledge, Tenant has fulfilled all of its
obligations under the Lease which are required to be fulfilled on a prior date
to such certificate, and (iii) Tenant's Tangible Net Worth and supporting
calculations.

          23.4   Monthly Course Statements.  Tenant will furnish to Landlord,
                 -------------------------
within 15 days after the end of each month during each fiscal year, a copy of
its operating statements for the Property and each of the Other Leased
Properties which shall include, without limitation, profit and loss statements,
including departmental revenue and expense analysis including rounds data and
membership data prepared on a modified accrual basis in accordance with
generally accepted accounting principles, except for depreciation, taxes,
capitalized interest and corporate and certain expense allocations, applied on a
basis consistently maintained throughout the period involved. Significant
departures from modified accrual basis will be identified in balance sheet
analysis

                                     -43-
<PAGE>
 
(i.e., accounts receivable, property, plant and equipment, capital spending and 
capitalized interest).

          23.5 Annual Course Statements.  Tenant will furnish to Landlord within
               ------------------------
90 days after the end of its fiscal year a copy of its operating statements for
the Property and each of the Other Leased Properties which shall include,
without limitation, profit and loss statements, including departmental revenue
and expense analysis including rounds data and membership data prepared on a
modified accrual basis in accordance with generally accepted accounting
principles, except for depreciation, taxes, capitalized interest and corporate
and certain expense allocations, applied on a basis consistently maintained
throughout the period involved. Significant departures from modified accrual
basis will be identified in balance sheet analysis (i.e., accounts receivable,
property, plant and equipment, capital spending and capitalized interest).

          23.6 Budgets.  Tenant shall furnish to Landlord copies of annual 
               -------
budgets, including monthly breakdowns for the Property and each of the Other
Leased Properties no later than 30 days prior to the applicable fiscal year of
Tenant. Such annual budgets shall include, without limitation, repairs, capital
budgets and marketing plans for each of the Properties. If prepared by Tenant,
Tenant shall also promptly deliver to Landlord any quarterly and annual
reforecasts of the budgets.

          23.7 Environmental Statements.  Immediately upon Tenant's learning, or
               ------------------------
having reasonable cause to believe, that any Hazardous Material in a quantity
sufficient to require remediation or reporting under applicable law is located
in, on or under the Leased Property or any adjacent property, Tenant shall
notify Landlord in writing of (a) any enforcement, cleanup, removal, or other
governmental or regulatory action instituted, completed or threatened; (b) any
claim made or threatened by any Person against Tenant or the Leased Property
relating to damage, contribution, cost recovery, compensation, loss, or injury
resulting from or claimed to result from any Hazardous Material; and (c) any
reports made to any federal, state or local environmental agency arising out of
or in connection with any Hazardous Material in or removed from the Leased
Property, including any complaints, notices, warnings or asserted violations in
connection therewith.

          23.8 Confidentiality.  Landlord represents, warrants and agrees that 
               ---------------
all such information furnished to it by Tenant or its representatives under this
Article 23 (the "Confidential Information") will be kept confidential by 
----------       ------------------------
Landlord in accordance with the following provisions. Landlord, its directors, 
officer, employees, agents and representatives of its advisors (collectively 
referred to as the "representatives") will not disclose any of the Confidential 
                    ---------------
Information now or hereafter received or obtained from Tenant or its 
representatives to any third party, except as required by applicable law, legal 
process or otherwise as part of the customary disclosures of the general partner
of Landlord, or except as may be required to enforce Tenant's obligations under 
this Lease, without the prior written consent of Tenant; provided, 
                                                         --------

                                     -44-
<PAGE>
 
however, that any such information may be disclosed to representatives of 
-------
Landlord who need to know such Confidential Information and who agree to keep 
such information confidential and to be bound by this Section 23.8 to the same 
                                                      ------------
extent as if they were a party to this Lease.  Landlord will have no obligation 
hereunder with respect to any information within the Confidential Information to
the extent that such information has been made public by Tenant.  Landlord 
understands and acknowledges that unauthorized disclosure or use of the 
Confidential Information will cause irreparable harm to Tenant, and Tenant 
reserves all rights and remedies that it may have as a result of any such use of
disclosure, including injunctive and other equitable relief.

                        ARTICLE 24 - LANDLORD MORTGAGES
                        -------------------------------

          24.1      Landlord May Grant Liens.  Subject to Section 24.2, without 
                    ------------------------              ------------
the consent of Tenant, Landlord may, from time to time, directly or indirectly, 
create or otherwise cause to exist any lien, encumbrance or title retention 
agreement ("Landlord's Encumbrance") upon the Leased Property, or any portion 
            ----------------------
thereof or interest therein, whether to secure any borrowing or other means of 
financing or refinancing.  This Lease is and at all times shall be subject and 
subordinate to any ground or underlying leases, mortgages, trust deeds or like 
encumbrances, which may not or hereafter affect the Leased Property and to all 
renewals, modifications, consolidations, replacements and extensions of any such
lease, mortgage, trust deed or like encumbrance.  This clause shall be 
self-operative and no further instrument of subordination shall be required by
any ground or underlying lessor or by any mortgagee or beneficiary, affecting
any lease or the Leased Property. In confirmation of such subordination, Tenant
shall execute promptly any certificate that Landlord may request for such
purposes.

          24.2      Tenant's Non-Disturbance Rights.  So long as Tenant shall 
                    -------------------------------
pay all Rent as the same becomes due and shall fully comply with all of the
terms of this Lease and fully perform its obligations hereunder, none of
Tenant's rights under this Lease shall be disturbed by the holder of any
Landlord's Encumbrance. Landlord shall obtain from any holder of a Landlord
Encumbrance a nondisturbance agreement in a form reasonably acceptable to such
holder and shall deliver such nondisturbance agreement to Tenant. The
nondisturbance agreement shall protect Tenant's possession and other rights
under this Lease absent an Event of Default by Tenant hereunder.

          24.3      Facility Mortgage Protection.  Tenant agrees that the holder
                    ----------------------------
of any Landlord Encumbrance shall have no duty, liability or obligation to 
perform any of the obligations of Landlord under this Lease (unless and until it
becomes the owner of the Leased Property), but that in the event of Landlord's 
default with respect to any such obligation, Tenant will give any such holder 
whose name and address have been furnished to Tenant in writing for such purpose
notice of Landlord's default and allow such holder 30 days following receipt of 
such notice for the cure

                                     -45-
<PAGE>
 
of said default before invoking any remedies Tenant may have by reason thereof.

                       ARTICLE 25 - FINANCIAL COVENANTS
                       ---------------------------------

          25.1   Financial Covenants.  Subject to Section 25.2, at all times 
                 -------------------              ------------
during the Term Tenant shall post and maintain a Letter of Credit unless and
until Tenant: (a) maintains a minimum Tangible Net Worth of at least $1,000,000
or, following a Change in Control, $1,000,000 increased by four percent per
annum compounded annually from the Commencement Date to the date of such Change
in Control; (b) maintains a Rent Coverage Ratio of not less than 1.35 to 1 for
any period encompassing four consecutive Fiscal Quarters; (c) maintains a Fixed
Charge Coverage Ratio of not less than 1.25 to 1 for any period encompassing
four consecutive Fiscal Quarters; and (d) increases for each Fiscal Quarter
during the Term the Tangible Net Worth by the amount of at least fifty percent
(50%) of Tenant's net income on a consolidated basis after taxes (without
subtracting losses) (collectively, the "Financial Covenants"). Tenant shall
                                        -------------------
provide an Officer's Certificate to Landlord not later than 30 days after the
end of each Fiscal Quarter of Tenant as to Tenant's compliance or noncompliance
with the Financial Covenants, which certificate shall include a calculation in
reasonable detail of such compliance or noncompliance.

          25.2   Provision of Letter of Credit.  If any certificate delivered 
                 -----------------------------
pursuant to Section 25.1 shall disclose that Tenant is not in compliance with
            ------------
the Financial Covenants at any time after the initial Letter of Credit has been
released, Tenant shall deliver to Landlord a new Letter of Credit within 30 days
after the date of such certificate, but in no event after the end of Tenant's
subsequent Fiscal Quarter. Upon delivery of such new Letter of Credit to
Landlord, no breach or default under this Lease shall arise as a result of
Tenant's failure to meet the Financial Covenants. The new Letter of Credit shall
be maintained and delivered to Landlord until such date as Tenant shall
subsequently be in compliance with the Financial Covenants for two consecutive
Fiscal Quarters.

          25.3   Terms of Letter of Credit.  The Letter of Credit shall:
                 -------------------------

          (i)    be an irrevocable standby letter of credit from a bank with a
     long-term debt rating from each of Standard & Poor's and Moody's of
     investment grade naming Landlord (and/or any Facility Mortgagee if
     requested by Landlord) as beneficiary to secure Tenant's obligations
     hereunder and Tenant's or an Affiliate of Tenant's obligations under the
     Other Property Leases;

          (ii)   have a stated amount equal to the Letter of Credit Amount plus,
     if the Letter of Credit is intended to satisfy Tenant's obligations under
     the Other Property Leases with Landlord, the amounts required under such
     other leases;

          (iii)  have a term of not less than one year;

                                     -46-
<PAGE>
 
          (iv)   provide that it will be honored upon a signed statement by
     Landlord that Landlord is entitled to draw upon the letter of credit under
     this Lease, and shall require no signature or statement from any party
     other than Landlord;

          (v)    provide that Landlord had given not less than three Business
     Day's notice to Tenant prior to submitting the Letter of Credit to the bank
     for presentation; and

          (vi)   permit multiple draws by providing that following the honor of
     any drafts in an amount less than the aggregate stated amount of the Letter
     of Credit, the issuing bank shall return the original letter of credit to
     Landlord and that Landlord's rights as to the remaining stated amount of
     the Letter of Credit will not be extinguished.

          25.4   Draws Against Letter of Credit; Application of Proceeds.
                 -------------------------------------------------------
Landlord may draw against the Letter of Credit upon any monetary default under 
this Lease or any other Event of Default hereunder. Landlord may apply any 
amounts drawn under the Letter of Credit to the satisfaction of any obligations
owed to Landlord under this Lease or the Other Property Leases. Any proceeds 
from the Letter of Credit drawn but not so applied shall be held by Landlord as 
a security deposit.

          25.5   Renewal of Letter of Credit.  If the Letter of Credit shall 
                 ---------------------------
expire at a time when the Letter of Credit is still required under Section 25.1 
                                                                   ------------
or Section 25.2, Tenant shall renew the Letter of Credit at least 30 days prior 
   ------------
to its expiration. If Tenant shall fail to renew the Letter of Credit prior to
such time, Landlord may draw against the same and hold the proceeds thereof as a
security deposit until such time as Tenant shall renew the Letter of Credit.
Landlord shall hold such security deposit in a separate account in trust for
Tenant and shall account to Tenant for any interest earned thereon.

          25.6   Liquidated Damages.  The requirement for the delivery of the 
                 ------------------
Letter of Credit as required by Tenant under this Article 25 herein shall not 
                                                  ----------
create liquidated damages on behalf of Landlord for a default by Tenant under 
this Article 25. Tenant shall be liable for Landlord's actual damages calculated
     ----------          
as of the time of the default caused by Tenant's failure to deliver and maintain
the Letter of Credit as required under this Article 25.
                                            ----------

                          ARTICLE 26 - MISCELLANEOUS
                          --------------------------

          26.1   Landlord's Right to Inspect.  Upon reasonable prior notice to 
                 ---------------------------
Tenant, Tenant shall permit Landlord and its authorized representatives to
inspect the Leased Property during usual business hours subject to any security,
health, safety or confidentiality requirements of Tenant or any governmental
agency or insurance requirement relating to the Leased Property, or imposed by
law or applicable regulations. Notwithstanding the foregoing, no prior notice to
Tenant shall be required for casual Landlord visits not imposing any
unreasonable burdens upon Tenant. Landlord shall indemnify Tenant for all
liabilities, obligations,

                                     -47-
<PAGE>
 
losses, damages, penalties, actions, judgments, suits, costs, expenses or 
disbursements of any kind or nature whatsoever which may be imposed on, incurred
by, or asserted against Tenant by reason of Landlord's inspection pursuant to 
this Section 26.1.
     ------------

          26.2   No Waiver.  No failure by either party to insist upon the 
                 ---------
strict performance of any term hereof or to exercise any right, power or remedy 
consequent upon a breach thereof, and no acceptance by Landlord of full or 
partial payment of Rent during the continuance of any such breach, shall 
constitute a waiver of any such breach or of any such term. To the extent 
permitted by law, no waiver of any breach shall affect or alter this Lease, 
which shall continue in full force and effect with respect to any other then
existing or subsequent breach.

          26.3   Remedies Cumulative.  To the extent permitted by law, each 
                 -------------------
legal, equitable or contractual right, power and remedy of either party now or 
hereafter provided either in this Lease or by statute or otherwise shall be 
cumulative and concurrent and shall be in addition to every other right, power 
and remedy. The exercise  or beginning of the exercise by either party of any 
one or more of such rights, powers and remedies shall not prelude the 
simultaneous or subsequent exercise by such party of any or all of such other 
rights, powers and remedies.

          26.4   Acceptance of Surrender.  No surrender to Landlord of this 
                 -----------------------
Lease or of the Leased Property or any part thereof, or of any interest therein,
shall be valid or effective unless agreed to and accepted in writing by Landlord
and no act by Landlord or any representative or agent of Landlord, other than
such a written acceptance by Landlord, shall constitute an acceptance of any
such surrender.

          26.5   No Merger of Title.  There shall be no merger of this Lease or 
                 ------------------
of the leasehold estate created hereby reason of the fact that the same Person 
may acquire, own or hold, directly or indirectly, (a) this Lease or the 
leasehold estate created hereby or any interest in this Lease or such leasehold 
estate and (b) the fee estate in the Leased Property.

          26.6   Conveyance by Landlord.  If Landlord shall convey the Leased 
                 ---------------------
Property in accordance with the terms hereof other than as security for a debt,
Landlord shall, upon the written assumption by the transferee of the Leased
Property of all liabilities and obligations of the Lease be released from all
future liabilities and obligations under this Lease arising or accruing from and
after the date of such conveyance or other transfer as to the Leased Property. 
All such future liabilities and obligations shall thereupon be binding upon the 
new owner.

          26.7   Quiet Enjoyment.  So long as Tenant shall pay all Rent as the 
                 ---------------
same becomes due and shall fully comply with all of the terms of this Lease and 
fully perform its obligations hereunder, Tenant shall peaceably and quietly 
have, hold and enjoy the Leased Property for the Term hereof, free of any claim 
or other action by Landlord or anyone claiming by, through or under Landlord, 
but

                                     -48-
        
<PAGE>
 
subject to all liens and encumbrances contained in the title policy as of the 
date hereof.

          26.8   Notices.  All notices, demands, requests, consents, approvals 
                 -------
and other communications hereunder shall be in writing and delivered or mailed 
(by registered or certified mail, return receipt requested and postage prepaid),
addressed to the respective parties, as provided in the Basic Lease Provisions.

          26.9   Survival of Claims.  Anything contained in this Lease to the 
                 ------------------
contrary notwithstanding, all claims against, and liabilities of, Tenant or 
Landlord arising prior to any date of termination of this Lease shall survive 
such termination.

          26.10  Invalidity of Terms or Provisions.  If any term or provision of
                 ---------------------------------
this Lease or any application thereof shall be invalid or unenforceable, the 
remainder of this Lease and any other application of such term or provision 
shall not be affected thereby.

          26.11  Prohibition Against Usury.  If any late charges provided for in
                 -------------------------
any provision of this Lease are based upon a rate in excess of the maximum rate 
permitted by applicable law, the parties agree that such charges shall be fixed 
at the maximum permissible rate.

          26.12  Amendments to Lease.  Neither this Lease nor any provision 
                 -------------------
hereof may be changed, waived, discharged or terminated except by an instrument 
in writing signed by Landlord and Tenant.

          26.13  Successors and Assigns.  All the terms and provisions of this 
                 ----------------------
Lease shall be binding upon and inure to the benefit of the parties hereto. All 
permitted assignees or sublessees shall be subject to the terms and provisions 
of this Lease.

          26.14  Titles.  The headings in this Lease are for convenience of 
                 ------
reference only and shall not limit or otherwise affect the meaning hereof.

          26.15  Governing Law.  This Lease shall be governed by and construed 
                 -------------
in accordance with the internal laws of the State of South Carolina.

          26.16  Memorandum of Lease.  Landlord and Tenant shall, promptly upon 
                 -------------------
the request of either, enter into a short form memorandum of this Lease, in form
and substance satisfactory to Landlord and suitable for recording under the laws
of the State, in which reference to this Lease, and all options contained
herein, shall be made. Tenant shall pay all costs and expenses of recording such
Memorandum of Lease.

          26.17  Attorney's Fees.  In the event of any dispute between the 
                 ---------------
parties hereto involving the covenants or conditions contained in this Lease or 
arising out of the subject matter of

                                     -49-
<PAGE>
 
this Lease, the prevailing party shall be entitled to recover against the other 
party reasonable attorneys' fees and court costs.

          26.18  Non-Recourse as to Landlord.  Anything contained herein to the 
                 ---------------------------
contrary notwithstanding, any claim based on or in respect of any liability of 
Landlord under this Lease shall be enforced only against the Leased Property and
not against any other assets, properties or funds of (a) Landlord, (b) any 
director, officer, general partner, limited partner, employee or agent of 
Landlord, or with respect to any general partner of Landlord, any of their 
respective general partners or stockholders (or any legal representative, heir, 
estate, successor or assign of any thereof), (c) any predecessor or successor 
partnership or corporation (or other entity) of Landlord, or any of their 
respective general partners, either directly or through either Landlord or their
respective general partners or any predecessor or successor partnership or 
corporation or their stockholders, officers, directors, employees or agents (or 
other entity), or (d) any other Person affiliated with any of the foregoing, or 
any director, officer, employee or agent of any thereof; provided that the 
provisions of this Section 26.18 shall not apply with respect to fraud or 
                   -------------
intentional misconduct by Landlord.

          26.19  No Relationship.  Landlord shall in no event be construed for 
                 ---------------
any purpose to be a partner, joint venturer or associate of Tenant or of any 
subtenant, operator, concessionaire or licensee of Tenant with respect to the 
Leased Property or any of the Other Leased Properties or otherwise in the 
conduct of their respective businesses.

          26.20  Signs; Reletting.  During the last two (2) years of the Term, 
                 ----------------
Landlord shall have the right (i) to advertise the availability of the Leased 
Property for sale or reletting and to erect upon the Leased Property signs 
indicating such availability and (ii) to show the Leased Property to prospective
purchasers or tenants or their agents at such reasonable times as Landlord may 
elect, subject to any security, health, safety or confidentiality requirements 
of Tenant, and provided that Landlord does not materially interfere with the 
operation of Tenant's business.

          26.21  Golf Course Name.  The Leased Property shall be known by such 
                 ----------------
trade name and/or trademark or logo as may from time to time be determined by 
Tenant, subject to Landlord's approval which shall not be unreasonably withheld.
Tenant may identify the Leased Property as a golf course managed and operated by
Tenant and may use Tenant's logo alone or in conjunction with other words or 
names or designs owned by Tenant or any of its affiliates.

                                     -50-
<PAGE>
 
                                   EXHIBIT A
                                   ---------

                         Defined Terms; Interpretation
                         -----------------------------

Defined Terms.  For all purposes of this Lease, except as otherwise expressly 
-------------
provided or unless the context otherwise requires, the terms defined below have 
the meanings assigned to them below.

          Additional Charges:  As defined in Section 3.4.
          ------------------                 -----------

          Additional Rent:  As defined in Basic Lease Provisions.
          ---------------

          Affiliate:  As applied to any Person, means any other Person directly 
          ---------
or indirectly controlling, controlled by, or under common control with, that 
Person.
          
          Annual Base Rent:  As defined in the Basic Lease Provisions.
          ----------------

          Applicable Percentage:  As defined in the Basic Lease Provisions.
          ---------------------

          Award:  Means all compensation, sums or anything of value awarded, 
          -----
paid or received on a total or partial Condemnation.

          Base Rent:  Means one-twelfth of the Annual Base Rent.
          ---------

          Basic Lease Provisions:  The provisions so labelled starting on page 
          ----------------------
(i) of this Lease.

          Business Day:  Each Monday, Tuesday, Wednesday, Thursday and Friday 
          ------------
which is not a day on which national banks in the City of New York, New York, 
are authorized, or obligated, by law or executive order, to close.

          Capital Expenditures:  As defined in the Basic Lease Provisions.
          --------------------

          Capital Improvement Account:  Means a deposit account in the name of 
          ---------------------------
Tenant maintained in South Carolina with a major bank selected by Tenant.

          Change of Control:  As defined in Section 22.2.
          -----------------                 ------------

          Code:  The Internal Revenue Code of 1986, as amended.
          ----

          Commencement Date:  As defined in the Basic Lease Provisions.
          -----------------

          Condemnation:  Means (a) the exercise of any governmental power, 
          ------------
whether by legal proceedings or otherwise, by a Condemnor, and (b) a voluntary 
sale or transfer by Landlord to any Condemnor, either under threat of 
condemnation or while legal proceedings for condemnation are pending.

<PAGE>
 
          Condemnation Threshold:  Means $4,800,000.
          ----------------------

          Condemnor:  Means any public or quasi-public authority, or private 
          ---------
corporation or individual, having the power of condemnation.

          Consumer Price Index:  Means the Consumer Price Index for all Urban 
          --------------------
Consumers, U.S. City Average (1982-84=100), as published by the Bureau of Labor 
Statistics of the United States Department of Labor.

          Control:  Means (including, with correlative meanings, the terms 
          -------
"controlling" and "controlled by"), as applied to any Person, the possession, 
directly or indirectly, of the power to direct or cause the direction of the 
management and policies of that Person, whether through the ownership of voting 
securities, by contract or otherwise.

          Course Revenue:  Means all revenues received (whether by Tenant or 
          --------------
any subtenants, concessionaires or licensees) from or by reason of the operation
of the Facility, or any other use of the Leased Property, including revenues 
from memberships (to the extent the membership was sold on or after the 
Commencement Date), initiation fees (to the extent the membership was sold on or
after the Commencement Date), dues, greens fees, fees to reserve a tee time, 
golf-related guest fees or golf cart rentals, golf-related surcharges, fees or 
other charges paid to Tenant by sponsors of golf tournaments at the Leased 
Property (unless the terms under which Tenant is paid by such sponsor do not 
comply with Section 22.5, in which event the gross revenues received by such 
            ------------
sponsor for the tournament shall be included in Course Revenue) and proceeds of 
any business interruption or similar insurance actually received by Tenant; 
provided, however, that Course Revenue shall not include;
-----------------

               (a)  Other Revenue;

               (b)  Cash refunds or credits allowed on returns by customers;

               (c)  The amount of any city, county, state or federal sales or 
               excise tax on sales, which is both added to the selling price and
               paid to the taxing authority by Tenant; and the amount of any
               city, county, state, or federal admission tax or use tax, which
               is paid to the relevant taxing authority by Tenant;

               (d)  The actual uncollectible amount of any check or bank draft 
               received by Tenant as payment for goods or services and returned
               to Tenant from a customer's bank as being uncollectible, but only
               after Tenant has made reasonable efforts to collect on the check;

<PAGE>
 
               (e)  The actual uncollectible amount of any charge or credit
               account incurred by Tenant for the sale of merchandise or
               services; provided, however, that the credit was extended to the
                         -----------------
               customer by Tenant, and that reasonable efforts to collect said
               account have been made;

               (f)  The actual uncollectible amount of any sale of merchandise
               or services for which Tenant accepted a credit card; provided,
                                                                    --------
               however, that Tenant has made reasonable efforts to collect the
               -------
               debt after being notified by the issuing bank of the invalidity
               or uncollectibility of the charge;

               (g)  Interest or other charges paid by customers for extension of
               credit;

               (h)  Revenue or proceeds from sales or trade-ins of machinery, 
               vehicles, trade fixtures or personal property used in connection
               with Tenant's operation of the Leased Property;

               (i)  The value of any merchandise, supplies or equipment 
               exchanged or transferred from or to other locations or businesses
               of Tenant where such exchange or transfer is not made for the
               purpose of avoiding a sale which would otherwise be made from or
               at the Leased Property;

               (j)  Revenue, if any, from receipts in the form of refunds from 
               or the value of merchandise, supplies or equipment returned to
               shippers, suppliers or manufacturers;

               (k)  Revenue, if any, from the amount of any cash or quantity 
               discounts received from sellers, suppliers or manufacturers;

               (l)  The amount of any gratuities paid or given by customers to 
               or for employees of Tenant;

               (m)  Receipts from the sales of uniforms or clothing required to 
               be worn by employees;

               (n)  Revenues from charging employees for meals served or 
               provided to employees of Tenant;

               (o)  Receipts from the sale of waste or scrap materials resulting
               from Tenant's operations;

               (p)  Revenue received from any subtenant, concessionaire or 
               licensee, inasmuch as the gross revenue received by such
               subtenant, concessionaire or licensee is otherwise included in
               the definition of Course Revenue or Other Revenue;
<PAGE>
 
               (q)  Gross revenue received by any sponsor of a golf tournament 
               at the Leased Property, provided that the terms under which
               Tenant is paid surcharges, fees or other charges by such sponsor
               comply with Section 22.5;
                           ------------

               (r)  Receipts from the sales of supplies or inventory by Tenant 
               to subtenants, concessionaires, or licensees provided that such
               sales are at Tenant's cost of such supplies or inventories with
               no markup or premium; and

               (s)  Revenue received by any golf professional who is an employee
               at the Facility for golf instruction services at the Facility
               (excluding any golf school or golf seminar activities) provided
               that Tenant receives no fee, mark-up or premium for such
               services.

          For purposes of this definition of Course Revenue, all references to 
Tenant in clauses (a) through (s) above shall also include any subtenants, 
concessionaires and licensees.

          Date of Taking:  Means the date the Condemnor has the right to 
          --------------
possession of the property being condemned.

          Environmental Law:  Means all applicable statutes, regulations, rules,
          -----------------
ordinances, codes, licenses, permits, orders, demands, approvals, authorizations
and similar items of all governmental agencies, departments, commissions,
boards, bureaus or instrumentalities of the United States, states and political
subdivisions thereof and all applicable judicial, administrative and regulatory
decrees, judgments and orders relating to the protection of human health from
Hazardous Materials (as defined in this Exhibit "A") or the environment as in
                                        ----------
effect on the Commencement Date or as thereafter amended, including but not
limited to those pertaining to reporting, licensing, permitting, investigation,
removal and remediation of emissions, discharges, releases or threatened
releases of Hazardous Materials into the air, surface water, ground water or
land, or relating to the manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of Hazardous Materials including: (x)
the Comprehensive Environmental Response, Compensation and Liability Act (42
U.S.C. (S)(S) 9601 et seq.), the Resource Conservation and Recovery Act (42
                   -- ---
U.S.C. (S)(S) 6901 et seq.), the Clean Air Act (42 U.S.C. (S)(S) 7401 et seq.),
                   -- ---                                             -- --- 
the Federal Water Pollution Control Act (33 U.S.C. (S) 1251 et seq.), the Safe
                                                            -- ---
Drinking Water Act (42 U.S.C. (S)(S) 300f et seq.), the Toxic Substances Control
                                          -- ---
Act (15 U.S.C. (S)(S) 2601 et seq.), the Endangered Species Act (16 U.S.C.
                           -- ---
(S)(S) 1531 et seq.), the Emergency Planning and Community Right-to-Know Act of
            -- ---
1986 (42 U.S.C: (S)(S) 11001 et seq.), and (y) analogous state and local
                             -- ---
provisions.



<PAGE>
 
          Escalated:  Means, as to any dollar amount and any date of 
          ---------
determination, such amount as increased annually by the annual increase in the 
Consumer Price Index from the month in which the Commencement Date occurs to the
month in which the date of determination occurs.

          Event of Default:  As defined in Section 16.1.
          ----------------                 ------------

          Facility:  As defined in the Basic Lease Provisions.
          --------

          Facility Mortgage:  As defined in Section 13.1.
          -----------------                 ------------

          Facility Mortgagee:  Means the holder or beneficiary of a Facility 
          ------------------
Mortgage, if any, and only to the extent Landlord gives Tenant notice of the 
identity and address of the Person.

          Financial Covenants:  As defined in Section 25.1.
          -------------------                 ------------

          Fiscal Quarter:  The three-month periods (or applicable portions 
          --------------
thereof) in any Fiscal Year from January 1 through March 31, April 1 through 
June 30, July 1 through September 30 and October 1 through December 31.

          Fiscal Year:  As defined in the Basic Lease Provisions.
          -----------

          Fixed Charge Coverage Ratio:  Means, for any period, the ratio of (A) 
          ---------------------------
the sum of, without duplication (i) consolidated net income of Tenant excluding 
any gains or losses in respect of dispositions plus (ii) provision for taxes 
plus (iii) consolidated interest expense (including non-cash interest payments 
or accruals and the interest component, if any, of lease obligations of Tenant 
and its subsidiaries) plus (iv) all lease (including capitalized equipment 
leases) and rent obligations (including percentage rent obligations) of Tenant 
and its subsidiaries plus (v) other non-cash charges deducted from consolidated 
revenues in determining net income for such period including depreciation and 
amortization (including amortization of intangibles), over (B) the sum of (i) 
consolidated interest expenses of Tenant and its subsidiaries for such period 
plus (ii) all lease (including capitalized equipment leases) and rent 
obligations (including percentage rent obligations) of Tenant and its 
subsidiaries for such period plus (iii) all principal debt payments plus (iv) 
capital improvement obligations.

          Fixtures:  Means all permanently affixed equipment, machinery, 
          --------
fixtures, and other items of real and/or personal property, including all 
components thereof, now and hereafter located in, on or used in connection with 
and permanently affixed to or incorporated into the Leased Improvements, 
including all furnaces, boilers, heaters, electrical equipment, heating, 
plumbing, lighting, ventilating, refrigerating, air and water pollution control,
waste disposal, air-cooling and air-conditioning systems and apparatus, 
sprinkler systems and fire and theft protection equipment, all of which, to the 
greatest extent permitted by law, are hereby deemed by the parties hereto to 
constitute real estate, together with all replacements,

<PAGE>
 
modifications, alterations and additions thereto, but specifically excluding all
items included within the category of Tenant's Personal Property and any Tenant 
Improvements.

          Full Replacement Cost:  Means the actual replacement cost thereof from
          ---------------------
time to time including increased cost of construction endorsement, less 
exclusions provided in the normal fire insurance policy.

          Hazardous Material:  Means any chemical substance:
          ------------------

               (i)    the presence of which requires investigation or
               remediation under any federal, state or local statute,
               regulation, ordinance, order, action or policy, administrative
               request or civil complaint under any of the foregoing or under
               common law;

               (ii)   which is defined as a "hazardous waste" or "hazardous 
               substance" under any federal, state or local statute, regulation
               or ordinance or amendments thereto as in effect as of the
               Commencement Date, or as thereafter amended, including the
               Comprehensive Environmental Response, Compensation and Liability
               Act (42 U.S.C. (S)(S) 9601 et seq.) and/or the Resource
                                          ------
               Conservation and Recovery Act (42 U.S.C. (S)(S) 6901 et seq.);
                                                                    ------

               (iii)  which is toxic, explosive, corrosive, flammable, 
               infectious, radioactive, carcinogenic, mutagenic or otherwise
               hazardous and as of the Commencement Date, or as thereafter
               amended, is regulated by any governmental authority, agency,
               department, commission, board, or instrumentality of the United
               States, or any state or any political subdivision thereof having
               or asserting jurisdiction over the Leased Property;

               (iv)   the presence of which on any of the Leased Property causes
               a nuisance upon such Leased Property or to adjacent properties or
               poses a hazard to the health or safety of persons on or about any
               of the Leased Property.

               (v)    which, except as contained in building materials, contains
               gasoline, diesel fuel or other petroleum hydrocarbons,
               polychlorinated biphenyls (PCBs) of friable asbestos or friable
               asbestos-containing materials or urea formaldehyde foam
               insulation; or

               (vi)   radon gas.

          Impartial Appraiser:  As defined in Section 13.2.
          -------------------                 ------------

          Impositions:  Means collectively:
          -----------

<PAGE>
 
               (a)  all taxes (including all real and personal property, ad 
               valorem, sales and use, single business, gross receipts,
               transaction privilege, rent or similar taxes);

               (b)  assessments and levies (including all assessments for public
               improvements or benefits, whether or not commenced or completed
               prior to the date hereof and whether or not to be completed
               within the Term);

               (c)  excises;

               (d)  fees (including license, permit, inspection, authorization 
               and similar fees); and

               (e)  all other governmental charges;

          in each case whether general or special, ordinary or extraordinary, or
foreseen or unforeseen, of every character in respect of the Leased Property
and/or the Rent (including all interest and penalties thereon due to any failure
in payment by Tenant), which at any time during or in respect of the Term hereof
may be assessed or imposed on or in respect of or be a lien upon (i) Landlord or
Landlord's interest in the Leased Property; (ii) the Leased Property or any part
thereof or any rent therefrom or any estate, right, title or interest therein;
or (iii) any operation, use or possession of, or sales from or activity
conducted on or in connection with the Leased Property or the leasing or use of
the Leased Property or any part thereof; provided, however, that Impositions
                                         --------  -------  
shall not include:

               (aa)  any tax based on net income (whether denominated
               as an income, franchise, capital stock or other tax)
               imposed on Landlord or any other Person other than
               Tenant;

               (bb)  any transfer, or net revenue tax of Landlord or 
               any other Person other than Tenant;

               (cc)  any tax imposed solely with respect to the sale, 
               exchange or other disposition by Landlord of any Leased
               Property or the proceeds thereof; or

               (dd)  any tax imposed with respect to any principal or 
               interest on any indebtedness on the Leased Property.

          Impound Charges:  As defined in Section 16.9.
          ---------------                 ------------

          Impound Payment:  As defined in Section 16.9.
          ---------------                 ------------

          Initial Base Rent: As defined in the Basic Lease Provisions.
          -----------------
<PAGE>
 
          Insurance Requirements:  All terms of any insurance policy required by
          ----------------------
this Lease and all requirements of the issuer of any such policy.

          Land:  As defined in Article 1.
          ----                 ---------

          Landlord:  As defined in the preamble.
          --------

          Landlord's Encumbrance:  As defined in Section 24.1.
          ----------------------                 ------------

          Landlord's Personal Property:  As defined in Article 1.
          ----------------------------                 ---------

          Lease:  As defined in the preamble.
          -----

          Leased Improvements:  As defined in Article 1.
          -------------------                 ---------

          Leased Property:  As defined in Article 1.
          ---------------                 ---------

          Legal Requirements:   All federal, state, county, municipal and other 
          ------------------
governmental statutes, laws (including the Americans with Disabilities Act and
any Environmental Laws), rules, orders, regulations, ordinances, judgments,
decrees and injunctions affecting either the Leased Property or the
construction, use or alteration thereof, whether now or hereafter enacted and in
force, including any which may (i) require repairs, modifications or alterations
in or to the Leased Property; (ii) in any way adversely affect the use and
enjoyment thereof, and all permits, licenses and authorizations and regulations
relating thereto, and all covenants, agreements, restrictions and encumbrances
contained in any instruments, either of record or known to Tenant (other than
encumbrances created by Landlord without the consent of Tenant), at any time in
force affecting the Leased Property; or (ii) require the cleanup or other
treatment of any Hazardous Material.

          Letter of Credit:  Means a letter of credit which satisfies the 
          ----------------
requirements of Sections 25.2 and 25.3.
                ----------------------

          Letter of Credit Amount:  Means, for any Fiscal Year, an amount equal 
          -----------------------
to 12 months of Base Rent for such Fiscal Year.

          Net From Operations:  Means, for any period, Total Revenue minus the 
          -------------------
sum of: (a) the cost of goods sold at the Leased Property, plus (b) all 
operating expenses (including all equipment and capital lease costs and property
taxes but excluding Rent, Capital Expenditures and depreciation) associated with
the operation of the Leased Property.

          Officer's Certificate:  A certificate of Tenant signed by an officer 
          ---------------------
authorized to so sign by the board of directors or by-laws.

          Official Records:  means the Official Records of the County of Horry, 
          ----------------
South Carolina.
<PAGE>
 
          Other Leased Properties:  Mean the properties, if any, leased to 
          -----------------------
Tenant or an Affiliate of Tenant by Landlord or an Affiliate of Landlord, and 
listed on Exhibit C attached hereto.
          --------- 

          Other Property Leases:  Mean the other leases entered into between 
          ---------------------
Landlord or an Affiliate of Landlord and Tenant or an Affiliate of Tenant 
relating to Tenant's use of the Other Leased Properties (if any).

          Other Revenue:  Means all revenue received (whether by Tenant or any 
          -------------
subtenants, concessionaires or licensees) from or by reason of the Leased 
Property relating to (i) the operation of snack bars, restaurants, bars and 
banquet operations, (ii) golf and tennis professionals' shops on the Leased 
Property, (iii) parking, (iv) fitness centers, (v) tennis facilities, (vi) day 
care, (vii) nongolf-related guest fees and related surcharges, (viii) locker 
rentals, (ix) bag storage, (x) video games, (xi) vending machines and (xii) fees
or other charges paid to Tenant by providers of golf lessons (unless the terms 
under which Tenant is paid by such provider do not comply with Section 22.5, in 
                                                               ------------
which event the gross revenue received by such provider shall be included in 
Other Revenue); but excluding: (1) the items described in clauses (b) through 
                ------------- 
(r) of the definition of Course Revenue (for purposes of this definition of 
Other Revenue, all references to Tenant in clauses (a) through (s) of the
definition of Course Revenue shall also include any subtenants, concessionaires
and licensees) and (2) gross revenue received by any provider of golf lessons,
provided that the terms under which Tenant is paid fees or other charges by such
provider comply with Section 22.5.
                     ------------             

          Overdue Rate:  On any date, a rate equal to 2 1/2% above the Prime 
          ------------ 
Rate, but in no event greater than the maximum rate then permitted under 
applicable law.

          Person:  Means and includes natural persons, corporations, limited 
          ------
partnerships, general partnerships, joint stock companies, joint ventures, 
associations, companies, trusts, banks, trust companies, land trusts, business 
trust, Indian tribes or other organizations, whether or not legal entities, and 
governments and agencies and political subdivisions thereof.

          Primary Intended Use:  Means the operation of a public golf course, 
          --------------------
consisting of the Facility, and other activities customarily associated with or 
incidental to the operation of the Facility, including sale or rental of 
golf-related merchandise at a golf professional's shop, furnishing of lessons by
a golf professional, operation of a driving range, and sales of food and 
beverages, including liquor sales and operation of tennis courts, athletic 
facilities or overnight rental units.

          Prime Rate:  On any date, a rate equal to the annual rate on such date
          ----------
announced by Citibank, N.A. to be its prime rate or base rate for 90-day 
unsecured loans to its corporate borrowers of the highest credit standing but in
no event greater than the maximum rate then permitted under applicable law. 

<PAGE>
 
          Programs:  As defined in Section 3.7.2.
          --------                 -------------

          Related Rights:  As defined in Article 1.
          --------------                 ---------

          Rent:  Collectively, the Base Rent, Additional Rent and Additional 
          ----
Charges, all as defined in Article 3.
                           ---------

          Rent Coverage Ratio:  Means, for any period, the ratio of (A) Net From
          -------------------
Operations over (B) Rent for such period.

          Replacement Water Rights:  Means Water Rights that provide water 
          ------------------------
supply and transportation at a quantity, price and priority which at the time of
their acquisition are not less favorable in any material respect to the holder 
of the Water Rights than the quantity, price and priority of the Water Rights 
which will be replaced by such Replacement Water Rights.

          State:  The State or Commonwealth in which the Leased Property is 
          -----
located.

          Tangible Net Worth:  Means the total book value of the assets of 
          ------------------
Tenant (excluding goodwill, patents, trademarks, trade names, organizational 
expense and loans to affiliates) less all liabilities and preferred stock.

          Tenant:  As defined in the preamble.
          ------

          Tenant Improvement:  As defined in Section 10.1.
          ------------------                 ------------

          Tenant's Original Water Rights:  As defined in Section 6.7.2.
          ------------------------------                 -------------

          Tenant's Personal Property:  All machinery, equipment, furniture, 
          --------------------------
furnishings, movable walls or partitions, phone system, computers or trade 
fixtures or other personal property, and consumable inventory and supplies, 
owned by Tenant and used or useful in Tenant's business on the Leased Property, 
including all items of furniture, furnishings, equipment, supplies and 
inventory, kitchen fixtures, bar equipment, flatware, lawn mowers and other 
gardening tools, tractors and other motorized vehicles and golf carts.
     
          Tenant's Properties:  As defined in Section 3.7.1.
          -------------------                 -------------

          Term:  As defined in the Basic Lease Provisions.
          ----

          Total Revenue:  Course Revenue plus Other Revenue.
          -------------

          Unavoidable Delays:  Delays due to strikes, lockouts, inability to 
          ------------------
procure materials, power failure, acts of God, governmental restrictions, enemy 
action, civil commotion, fire, unavoidable casualty or other causes beyond the 
control of the party responsible for performing an obligation hereunder, 
provided that lack of funds shall not be deemed a cause beyond the control of 
-------- ----
either party hereto unless such lack of funds is caused by the 
<PAGE>
 
failure of the other party hereto to perform any obligations of such party, 
under this Lease.

          Unsuitable For Its Primary Intended Use:  A state or condition of the 
          ---------------------------------------
Facility such that in the good faith judgment of Tenant, reasonably exercised, 
the Facility cannot be operated on a commercially practicable basis for its 
Primary Intended Use.

          Water Rights:  Means any rights for the supply or transportation of 
          ------------
water to the Leased Property owned from time to time by Landlord or Tenant, 
including Tenant's Original Water Rights and the Replacement Water Rights.
     
Interpretation.  The foregoing defined terms include the plural as well as the 
--------------
singular. "Including" and variants thereof shall be deemed to mean "including 
without limitation." All accounting terms not otherwise defined herein have the 
meanings assigned to them in accordance with generally accepted accounting 
principles at the time applicable. All references in this Lease to designated 
"Articles," "Sections" and other subdivisions are to the designated Articles, 
Sections and other subdivisions of the Detailed Lease Provisions unless 
otherwise indicated. The words "herein," "hereof" and "hereunder" and other 
words of similar import refer to this Lease as a whole and not to any particular
Article, Section or other subdivision.