<PAGE>   1

EXHIBIT 3(a)
                             STATE OF SOUTH CAROLINA
                               SECRETARY OF STATE
                            ARTICLES OF INCORPORATION
                                       OF

                           SEA PINES ASSOCIATES, INC.
                     ---------------------------------------
                     (File this Form in Duplicate Originals)

                            (ss.33-7-30 of 1976 Code)

TYPE OR PRINT CLEARLY IN BLACK INK

1. The name of the proposed corporation is Sea Pines Associates, Inc.

2. The initial registered office of the corporation is 16 Piping Plover
                                                       ----------------
                                                        Street Address

   Hilton Head Island        Beaufort              SC                    29928
   -----------------------------------------------------------------------------
        City                  County              State                Zip Code

   and the initial registered agent at such address is:  Paul T. Clark
                                                         -------------
                                                           Print Name

3. The period of duration of the corporation shall be perpetual (XXXXXXX years).
                                                                ---------------

4. The corporation is authorized to issue shares of stock as follows.

              Class of Shares         Authorized No. of Each Class    Par Value
              ---------------         ----------------------------    ---------
              Preferred                      5,000,000                   No

              Voting Common                  3,000,000                   No

              Nonvoting Common               1,000,000                   No

              Special Common                 2,000,000                   No

    If shares are divided into two or more classes or if any class of shares is
divided into series within a class, the relative rights, preferences, and
limitations of the shares of each class, and of each series within a class, are
as follows:


5   Total Authorized Capital Stock is 11 million shares at no par value.
                                      ----------------------------------

6.  The existence of the corporation shall begin as of the filing date with the
    Secretary of State or to be effective:   XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
                                             ----------------------------------

7.  The number of directors constituting the initial board of directors of
    the corporation is 25 and the names and addresses of the persons who
    are to serve as directors until the first annual meeting of
    shareholders or until their successors be elected and qualify are as
    follows:

                Name                                  Address
                ----                                  -------

       a.   Charles F. Bacon         36 Ruddy Turnstone, Hilton Head, SC 29928
            ---------------------    ------------------------------------------

       b.   Peter W. Bauman          9 Bald Eagle Rd., E. Hilton Head, SC 29928
            ---------------------    ------------------------------------------

       c.   Lee A. Carey             46 Governor's Rd., Hilton Head, SC 29928
            ---------------------    ------------------------------------------

       d.   Paul T. Clark            16 Piping Plover, Hilton Head, SC 29928
            ---------------------    ------------------------------------------

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8.   The general nature of the business for which the corporation is
     organized is as follows: (It is not necessary to set forth the powers
     enumerated in ss.33-3-10 of 1976 Code): To engage in any lawful act or
     activity for which corporations may be organized under South Carolina
     law, including without limitation, to engage in the business of
     acquiring, owning, operating and managing golf courses, recreational
     facilities and other real and personal property within and outside the
     State of South Carolina.

9.   Provisions which the incorporators elect to include in the articles of
     incorporation are as follows: (Attach additional sheet(s) if
     necessary). (See attached)

10.  The name and address of each incorporator is as follows:

                 Name          Street & Box Number    City    County      State
     a. Elizabeth Corr-Smedley 1401 Main,          Columbia,  Richland,    SC
        ---------------------- ------------------------------------------------

     b.
        ---------------------- ------------------------------------------------

     c.
        ---------------------- ------------------------------------------------

     d.
        ---------------------- ------------------------------------------------

        s/Elizabeth Corr Smedley               Elizabeth Corr Smedley
        ------------------------ -----------------------------------------------
        signature of incorporator              type or print name

        ------------------------- ----------------------------------------------
        signature of incorporator              type or print name

        ------------------------- ----------------------------------------------
        signature of incorporator              type or print name

        ------------------------- ----------------------------------------------
        signature of incorporator              type or print name

         Date:        May 4, 1987
              --------------------------

STATE OF      SOUTH CAROLINA
COUNTY OF     RICHLAND

         The undersigned, Elizabeth Corr Smedley do hereby certify that they are
         the incorporators of Sea Pines Associates, Inc. Corporation and are
         authorized to execute this verification; that each of the undersigned
         does hereby certify that he or she has read the foregoing document,
         understands the meaning and purport of the statements therein contained
         and the same are true to the best of his or her information and belief.

                                                     s/Elizabeth Corr Smedley
         ----------------------------------          ---------------------------
              signature of incorporator              signature of incorporator


         ----------------------------------          ---------------------------
              signature of incorporator              signature of incorporator



<PAGE>   3

                             CERTIFICATE OF ATTORNEY

         I, Edward G. Menzie , an attorney licensed to practice in the State of
         South Carolina, certify that the corporation, to whose articles of
         incorporation this certificate is attached, has complied with the
         requirements of Chapter 7, Title 33 of the Code of Laws of South
         Carolina (1976) relating to the organization of corporations, and that
         in my opinion, the corporation is organized for a lawful purpose.

Date              May 4, 1987                      s/Edward G. Menzie
         ---------------------------               -----------------------------
                                                            Signature

                                                   Edward G. Menzie
                                                   -----------------------------
                                                       Type or Print Name

                                                   1401 Main Street, Suite 3200
                                                   -----------------------------
                                                             Address

                                                   Columbia,     SC       29201
                                                   -----------------------------
                                                     City       State      Zip

                                SCHEDULE OF FEES
          (Payable at time of filing Articles with Secretary of State)

Fee for filing Articles                              $    5.00
In addition to the above, $.40 for each
     $1,000 of the aggregate value of
     shares which the corporation is autho-
     rized to issue, but in no case less than        $   40.00
     nor more than                                   $1,000.00

Note:    THIS FORM MUST BE COMPLETED IN ITS ENTIRETY BEFORE IT WILL BE ACCEPTED
         FOR FILING. THIS FORM MUST BE ACCOMPANIED BY THE FIRST REPORT OF
         CORPORATIONS AND A CHECK IN THE AMOUNT OF $10.00 PAYABLE TO THE SOUTH
         CAROLINA TAX COMMISSION.

<PAGE>   4

                     ATTACHMENT TO ARTICLES OF INCORPORATION
                                       OF
                           SEA PINES ASSOCIATES, INC.

         4. A statement of the preferences, privileges and restrictions granted
to or imposed upon the respective classes of shares or the holders thereof is as
follows:

                  (a) Preferred Shares.

                  (1) Authority is hereby expressly granted and vested in the
Board of Directors of the Corporation to provide for the issuance of up to
5,000,000 shares of Preferred Stock, of which 2,000,000 shares shall be Series A
Cumulative Preferred Stock, as set forth in subparagraph 4(a)(2) below, in one
or more series and in connection therewith to fix by resolutions providing for
the issue of such series the number of shares to be included in such series and
the designations and such voting powers, full or limited, or no voting powers,
and such preferences, and relative, participating, optional or other special
rights, and the qualifications, limitations or restrictions thereof, of such
series which are not fixed by the Articles of Incorporation, to the full extent
now or hereafter permitted by the laws of the State of South Carolina; provided,
however, that in no event shall the dividend and liquidation rights of any
shares of this Preferred Stock be superior to the series A Cumulative Preferred
Stock authorized by subparagraph 4(a)(2) below. Without limiting the generality
of the grant of authority contained in the preceding sentence, the Board of
Directors is authorized to determine any or all of the following, and the shares
of each series may vary from the shares of any other series in any or all of the
following respects:

                           (i) The number of shares of such series (which may
subsequently be increased, except as otherwise provided by the resolutions of
the Board of Directors providing for the issuance of such series, or decreased
to a number not less than the number of shares then outstanding) and the
distinctive designation thereof;

                           (ii) The dividend rights, if any, of such series, the
dividend preferences, if any, as between such series and any other class or
series of stock, whether and the extent to which shares of such series shall be
entitled to participate in dividends with shares of any other series or class of
stock, whether and the extent to which dividends on such series shall be
cumulative, and any limitations, restrictions or conditions on the payment of
such dividends;

                           (iii) The time or times during which, the price or
prices at which, and any other terms or conditions on which the shares of such
series may be redeemed, if redeemable;

                           (iv) The par value, if any, and other rights of such
series, and the preferences, if any, as between such series and any other class
or series of stock, in the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, and whether and the extent to
which shares of any such series shall be entitled to participate in such event
with any other class or series of stock;


<PAGE>   5

                           (v) The voting powers, if any, in addition to the
powers prescribed by law on shares of such series, and the terms of exercise of
such voting powers;

                           (vi) Whether shares of such series shall be

convertible into or exchangeable for shares of any other series or class of
stock, or any other securities, and the terms and conditions, if any, applicable
to such right; and/or

                           (vii) The terms and conditions, if any, of any

purchase, retirement, or sinking fund which may be provided for the shares of
such series.

                  (2) There is hereby authorized for issuance 2,000,000 of the
5,000,000 shares authorized by subparagraph 4(a)(1) above to be known and
designated as Series A Cumulative Preferred Stock which stock shall have the
following rights, preferences, privileges and restrictions:

                           (i) Dividends. The holders of Series A Cumulative
Preferred Stock shall be entitled to receive out of any funds of this
Corporation legally available for the declaration of dividends, dividends of
72.2(cent) per share per annum and no more, payable when and as declared by the
Board of Directors. Dividends on the Series A Cumulative Preferred Shares first
issued shall accrue daily, whether or not earned or declared, from the date
which is eighteen (18) months after the date of issuance of such shares, and
dividends on all Series A Cumulative Preferred Shares thereafter issued shall
accrue daily, whether or not earned or declared, from the day following the last
day of the period for which dividends have already been paid on outstanding
Series A Cumulative Preferred Shares. Such dividends shall be payable before any
dividends shall be declared or paid upon or set apart for the common shares, and
shall be cumulative, so that if in any year or years dividends upon the
outstanding Series A Cumulative Preferred Shares at the rate of 72.2(cent) per
share shall not have been paid or declared and set apart therefor, the amount of
the deficiency shall be fully paid or declared and set apart for payment, but
without interest, before any distribution, whether by way of dividend or
otherwise, shall be declared or paid upon, or set apart for, the common shares.

                           (ii) Liquidation. In the event of a voluntary or
involuntary liquidation, dissolution or winding up of this Corporation, the
holders of Series A Cumulative Preferred Shares shall be entitled to receive out
of the assets of this Corporation, whether such assets are capital or surplus of
any nature, an amount equal to Seven and 60/100 ($7.60) Dollars per share and,
in addition to such amount, a further amount equal to the dividends unpaid and
accumulated thereon, as provided in subparagraph 4(a)(2)(i) above, through and
including the date of such distribution, whether or not earned or declared, and
no more, before any payment shall be made or any assets distributed to the
holders of common shares.

                  If upon such liquidation, dissolution, or winding up, whether
voluntary or involuntary, the assets thus distributed among the holders of the
Series A Cumulative Preferred Shares are insufficient to permit the payment to
such shareholders of the full preferential amounts, then the entire assets of
this Corporation to be distributed shall be distributed ratably among the
holders of the Series A Cumulative Preferred Shares and any other shares having
an equal liquidation priority with Series A Cumulative Preferred Shares.



                                       2
<PAGE>   6

                  A consolidation or merger of this Corporation with or into any
other corporation(s) shall not be deemed to be a liquidation, dissolution or
winding up within the meaning of this paragraph (ii).

                           (iii) Redemption This Corporation, at the option of
the Board of Directors, may from time to time redeem all or any part of the
outstanding Series A Cumulative Preferred Shares on any dividend date by paying
in cash therefor Seven and 60/100 ($7.60) Dollars per share and, in addition to
such amount, an amount in cash equal to all dividends on Series A Cumulative
Preferred Shares unpaid and accumulated as provided in subparagraph 4(a)(2)(i)
above, whether earned or declared or not, through and including the date fixed
for redemption, such sum being hereinafter sometimes referred to as the
redemption price. In the case of redemption of less than all of the outstanding
Series A Cumulative Preferred Shares, this Corporation shall designate by lot,
in such a manner as the Board of Directors may determine, the shares to be
redeemed, or shall effect such redemption pro rata. Less than all of the Series
A Cumulative Preferred Shares at any time outstanding may not be redeemed until
all dividends accrued and in arrears upon all outstanding Series A Cumulative
Preferred Shares shall have been paid for all past dividend periods, and until
full dividends for the then current dividend period on all outstanding Series A
Cumulative Preferred Shares, other than the shares to be redeemed, shall have
been paid or declared and the full amount thereof set apart for payment.

                  At least thirty (30) days' prior written notice by mail,
postage prepaid, shall be given to the holders of record of the Series A
Cumulative Preferred Shares to be redeemed, such notice to be addressed to each
such shareholder at his post office address as shown on the records of this
Corporation. On or after the date fixed for redemption and stated in such
notice, each holder of Series A Cumulative Preferred Shares called for
redemption shall surrender his certificate evidencing such shares to this
Corporation at the place designated in such notice and shall thereupon be
entitled to receive payment of the redemption price. In case less than all the
shares represented by any such surrendered certificate are redeemed, a new
certificate shall be issued representing the unredeemed shares. If notice of
redemption has been duly given, and on the date fixed for redemption the
necessary funds are available, then notwithstanding that the certificates
evidencing any Series A Cumulative Preferred Shares called for redemption have
not been surrendered, as of the date fixed for redemption the dividends with
respect to the shares called for redemption shall cease to accrue and all rights
with respect to the shares called for redemption shall terminate, except the
right of the holders to receive the redemption price without interest upon
surrender of their certificates.

                           (iv) Voting. If at any time dividends on the Series A
Cumulative Preferred Shares shall be in arrears in an amount equal to four (4)
years' dividends, the holders of Series A Cumulative Preferred Shares as a class
shall be entitled to elect the smallest number of directors which will
constitute a majority of the authorized number of directors, and the holders of
Voting Common Shares shall be entitled to elect the remaining members of the
Board of Directors. At such time as all dividends accrued on the outstanding
Series A Cumulative Preferred Shares have been paid or declared and set apart
for payment, the rights of the holders of Series A Cumulative Preferred Shares
to vote as provided in this subparagraph (iv) shall cease, subject to removal
from time to time upon the same terms and conditions.



                                       3
<PAGE>   7

                  At any time after the voting power to elect a majority of the
Board of Directors has become vested in the holders of the Series A Cumulative
Preferred Shares as provided in this subparagraph (iv), the Secretary of this
Corporation may, and upon the written request of the record holders of at least
ten (10%) percent of the outstanding Series A Cumulative Preferred Shares
addressed to the Secretary at the principal office of this Corporation shall,
call a special meeting of the holders of Series A Cumulative Preferred Shares
and the holders of Voting Common Shares for the election of directors, to be
held at the place and upon the notice provided in the By-Laws of this
Corporation for the holding of annual meetings. If such meeting shall not be so
called within ten (10) days after personal service of the request, or within
fifteen (15) days after mailing of the same by registered mail within the United
States of America, then the record holders of at least ten (10%) percent of the
Series A Cumulative Preferred Shares then outstanding may designate in writing
one (1) of their number to call such meeting, and the person so designated may
call such meeting at the place and upon the notice above provided, and for that
purpose shall have access to the stock books of the Corporation. At any meeting
so called or at any annual meeting held while the holders of the Series A
Cumulative Preferred Shares have the voting power to elect a majority of the
Board of Directors, the holders of a majority of the then outstanding Series A
Cumulative Preferred Shares present in person or by proxy shall be sufficient to
constitute a quorum for the election of directors as herein provided. The terms
of office of all persons who are directors of this Corporation at the time of
such meeting shall terminate as of the date of such meeting.

                  The staggered board of directors authorized by Paragraph 9(h)
of these Articles of Incorporation shall be suspended during the time the
holders of Series A Cumulative Preferred Shares have the right to elect a
majority of the directors pursuant to this provision. The persons so elected as
directors by the holders of the Series A Cumulative Preferred Shares, together
with such persons, if any, as may be elected as directors by the holders of the
Voting Common Shares, shall constitute the duly elected directors of this
Corporation. All directors so elected shall serve until the next annual meeting
or until their successors are elected and have qualified. In the event the
holders of the Voting Common Shares fail to elect the number of directors which
they are entitled to elect at such meeting, additional directors may be
appointed by the directors elected by the holders of Series A Cumulative
Preferred Shares.

                  Whenever the holders of the Series A Cumulative Preferred
Shares shall be divested of such voting powers as provided in this subparagraph
(iv), the term of office of all persons who are directors of this Corporation at
such time shall terminate upon the election of their successors by the holders
of the Voting Common Shares.

                  (b) Voting Common Shares.

                  (1) Dividends. Subject to all of the rights of holders of
Series A Cumulative Preferred Shares, the holders of Voting Common Shares shall
be entitled to share on a pro rata basis with the holders of Nonvoting Common
Shares* in any dividends declared on the common stock by the Board of Directors
out of any funds of the Corporation legally available therefor.

*and the Special Common Shares to the extent specified by the Board of Directors



                                       4
<PAGE>   8

                  (2) Liquidation. In the event of any liquidation, dissolution,
or winding up of this Corporation, whether voluntary or involuntary, subject to
all of the preferential rights of the holders of Series A Cumulative Preferred
Shares on distribution or otherwise, the holders of Voting Common Shares shall
be entitled to share pro rata with the holders of Nonvoting Common Shares in all
of the remaining assets of this Corporation.

                  A consolidation or merger of this Corporation with or into any
other corporation or corporations shall not be deemed to be a liquidation,
dissolution, or winding up within the meaning of this subparagraph (2).

                  (3) Voting. The holders of Voting Common Shares, except where
otherwise provided by law or by these Articles of Incorporation, shall have and
possess the exclusive right to notice of shareholders' meetings and the
exclusive voting rights and powers, and the holders of the Series A Cumulative
Preferred Shares and Nonvoting Common Shares shall not be entitled to any notice
of shareholders' meetings or to vote upon the election of directors or upon any
question affecting the management or affairs of this Corporation, except where
such notice or vote is required by law or by these Articles of Incorporation.

                  (c) Nonvoting Common Shares.

                  (1) Dividends. Subject to all of the rights of holders of
Series A Cumulative Preferred Shares, the holders of Nonvoting Common Shares
shall be entitled to share on a pro rata basis with the holders of Voting Common
Shares* in any dividends declared on the common stock by the Board of Directors
out of any funds of the Corporation legally available therefor.

                  (2) Liquidation. In the event of any liquidation, dissolution,
or winding up of this Corporation, whether voluntary or involuntary, subject to
all of the preferential rights of the holders of Series A Cumulative Preferred
Shares on distribution or otherwise, the holders of Nonvoting Common Shares
shall be entitled to share pro rata with the holders of Voting Common Shares* in
all of the remaining assets of this Corporation.

                  A consolidation or merger of this Corporation with or into any
other corporation or corporations shall not be deemed to be a liquidation,
dissolution, or winding up within the meaning of this subparagraph (2).

                  (3) Redemption. This Corporation, at the option of the Board
of Directors, may from time to time at any time after the expiration of three
(3) years from the date of issue and before the expiration of ten (10) years
from the date of issue, redeem all or any part of the outstanding Nonvoting
Common Shares on any dividend date by paying in cash therefor not less than Ten
($10.00) Dollars per share, hereinafter sometimes referred to as the redemption
price. In case of the redemption of less than all of the outstanding Nonvoting
Common Shares, this Corporation shall designate by lot, in such a manner as the
Board of Directors may determine, the shares to be redeemed, or shall effect
such redemption pro rata. At least thirty (30) days' prior written notice by
mail, postage prepaid, shall be given to the holders of record of the

*and the Special Common Shares to the extent specified by the Board of Directors



                                       5
<PAGE>   9

Nonvoting Common Shares to be redeemed, such notice to be addressed to each such
shareholder at his post office address as shown on the records of this
Corporation. On or after the date fixed for redemption and stated in such
notice, each holder of Nonvoting Common Shares called for redemption shall
surrender his certificate evidencing such shares to this Corporation at the
place designed in such notice and shall thereupon be entitled to receive payment
of the redemption price. In case less than all the shares represented by any
such surrendered certificate are redeemed, a new certificate shall be issued
representing the unredeemed shares. If notice of redemption has been duly given,
and on the date fixed for redemption the necessary funds are available, then
notwithstanding that the certificates evidencing any Nonvoting Common Shares
called for redemption have not been surrendered as to the date fixed for
redemption, all rights with respect to the shares called for redemption shall
terminate, except the right of the holders to receive the redemption price
thereof without interest upon surrender of their certificates.

                  (4) Voting. The holders of Nonvoting Common Shares shall have
no voting rights, nor any right to notice of shareholders meetings, except that
the holder of such shares shall vote as a class as expressly required by South
Carolina law.

                  (5) Conversion. At any time after the expiration of three (3)
years from the date of issue, the Board of Directors may cause the holders of
record of Nonvoting Common shares to convert all or any portion of their
outstanding Nonvoting Common Shares to Voting Common Shares, at the exchange
rate of one (1) Voting Common share for five (5) Nonvoting Common Shares.

                  (d) Special Common Shares. Authority is hereby expressly
granted and vested in the Board of Directors of the Corporation to provide for
the issue of up to 2,000,000 shares of no par Special Common Stock in one or
more series and in connection therewith to fix by resolutions providing for the
issue of each series the number of shares to be included in that series and the
designations and such voting rights, full or limited, or no voting rights, and
such preferences, and relative, participating, optional or other special rights,
and the qualifications, limitations or restrictions thereof, of any such series
of this Special Common Stock which are not fixed by these Articles of
Incorporation, to the full extent now or hereafter permitted by the laws of the
State of South Carolina; provided, however, that in no event shall any series of
shares of this Special Common Stock authorize more than one vote per share and
in no event shall the dividend or liquidation rights of this Special Common
Stock have a priority over the dividend or liquidation rights of the Voting
Common and Nonvoting Common Shares authorized by subparagraphs 4(b) and (c)
above. Without limiting the generality of the grant of authority contained in
the preceding sentence, the Board of Directors is authorized to determine any or
all of the following, and the shares of each series may vary from the shares of
any other series in any or all of the following respects:

                  (1) The number of shares of such series (which may
subsequently be increased, except as otherwise provided by the resolutions of
the Board of Directors providing for the issue of such series, or decreased to a
number not less than the number of shares then outstanding) and the distinctive
designation thereof;



                                       6
<PAGE>   10

                  (2) The dividend rights, if any, of such series, the dividend
preferences, if any, as between such series and any other class or series of
stock, whether and the extent to which shares of such series shall be entitled
to participate in dividends with shares of any other series or class of stock,
and any limitations, restrictions or conditions on the payment of such
dividends;

                  (3) The time or times during which, the price or prices at
which, and any other terms or conditions on which the shares of such series may
be redeemed, if redeemable;

                  (4) The preferences, if any, as between such series and any
other class or series of stock, in the event of any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation and whether and the
extent to which shares of any such series shall be entitled to participate in
such event with any other class or series of stock;

                  (5) The voting powers, if any, in addition to the voting
powers prescribed by law on shares of such series, and the terms of exercise of
such voting powers;

                  (6) Whether shares of such series shall be convertible into or
exchangeable for shares of any other series or class of stock, or any other
securities, and the terms and conditions, if any, applicable to such right;
and/or

                  (7) The terms and conditions, if any, of any purchase,
retirement, or sinking fund which may be provided for the shares of such series.

         7.       The names and addresses of the initial board of directors are
                  as follows:

                     (continued from first page of Articles)

Angus Cotton                                 Ralph W. Cox
7 Willet Road                                133 Governors Road
Hilton Head Island, SC  29928                Hilton Head Island, SC 29928
William R. Cullison                          Thomas G. Daniels
3 Royal Tern Road                            21 Baynard Park Road
Hilton Head Island, SC 29928                 Hilton Head Island, SC 29928
Charles W. Flynn                             Douglas H. Haight
14 Marsh View Road                           17 Governors Lane
Hilton Head Island, SC 29928                 Hilton Head Island, SC 29928
Harry B. Hazelton                            Dwight A. Holder
49 Baynard Cove Road                         51 South Beach Lagoon
Hilton Head Island, SC 29928                 Hilton Head Island, SC 29928
William L. Jackson                           Thomas A. Jenkins
11 Governors Lane                            27 Audubon Pond Road
Hilton Head Island, SC 29928                 Hilton Head Island, SC 29928
John C. Kingsbury                            James L. Krum
21 Governors Lane                            17 Green Wing Teal
Hilton Head Island, SC 29928                 Hilton Head Island, SC 29928
Lewis C. Laderer                             Barclay Morrison



                                       7
<PAGE>   11

13 Grey Widgeon                              56 N. Calibogue Cay
Hilton Head Island, SC 29928                 Hilton Head Island, SC 29928
J. Gordon Osborn                             John W. Simpson
81 Club Course Drive                         36 E. Beach Lagoon Road
Hilton Head Island, SC 29928                 Hilton Head Island, SC 29928
James H. Styers                              Alex C. Thomsen
64 N. Calibogue Cay                          22 Audubon Pond Road
Hilton Head Island, SC 29928                 Hilton Head Island, SC 29928
Francis S. Webster, Jr.                      Robert M. Williams
28 Club Course Drive                         11 Baynard Park Road
Hilton Head Island, SC 29928                 Hilton Head Island, SC 29928

                                 Frank Zimmerman
                              31 Audubon Pond Road
                          Hilton Head Island, SC 29928

          9.(a) Authority to Issue Debt. The Board of Directors shall be
authorized to issue notes, bonds or other evidence of indebtedness secured by
liens on all or part of the assets of the Corporation and to grant to the
holders such voting rights in the event of default in the obligations
represented thereby as it shall determine in its sole discretion. Except to the
extent limited by South Carolina law, such voting rights may include, but need
not be limited to, the right to elect and remove all directors; the exclusive
right to approve any merger, acquisition, dissolution, consolidation,
liquidation or sale, lease, exchange, transfer or other disposition of all or
substantially all of the assets of the Corporation; the exclusive right to amend
these Articles of Incorporation and the By-Laws of the Corporation; and such
other voting rights as may be permitted under South Carolina law.

                  (b) Authority to Issue Warrants. The Corporation is hereby
expressly authorized and empowered, from time to time, by resolution of its
Board of Directors, to create and issue, whether or not in connection with the
issue and sale of any shares or other securities of the Corporation, rights or
options entitling the holders or owners thereof to purchase or acquire from the
Corporation any shares of any class or series or other securities, whether now
or hereafter authorized, such rights or options to be evidenced by or in such
warrants or other instruments as shall be approved by the Board of Directors.
The terms upon which, the time or times, which may be limited or unlimited in
duration, at or within which, and the price or prices at which any such shares
or other securities may be purchased or acquired from the Corporation upon the
exercise of any such rights or options shall be such as shall be fixed in a
resolution or resolutions adopted by the Board of Directors providing for the
creation and issue of such rights or options, and set forth or incorporated by
reference in the warrants or other instruments evidencing such rights or
options, and as shall be permitted by law.

                  The Board of Directors is hereby authorized and empowered to
authorize the creation and issue of any such rights or options and any such
warrants or other instruments from time to time, for such consideration as the
Board of Directors may determine. Any and all shares which may be purchased or
acquired or issued upon the exercise of any such right or option shall be deemed
duly paid shares and not liable to any further call or assessment, or partly
paid and


                                       8
<PAGE>   12

liable to further call or assessment, as the terms of the warrants or other
instruments evidencing such rights or options shall provide. Except as otherwise
provided by law, the Board of Directors shall have full power and discretion to
prescribe and regulate from time to time the procedure to be followed in, and
all other matters concerning the creation, issue, and exercise of any such
rights and options and such warrants or other instruments, and the settling
aside of shares or other securities for the purpose thereof, and the issuance of
such shares or other securities upon the exercise thereof.

                  (c) Supermajority Voting Requirement for Sale of Corporate
Property, Merger or Similar Transaction. Except as otherwise authorized in these
Articles of Incorporation, the affirmative vote, at a shareholders' meeting duly
called for that purpose, of the holders of at least eighty (80%) percent of the
Voting Common Shares issued and outstanding shall be required to authorize the
Board of Directors to sell, lease, exchange or otherwise dispose of all or
substantially all of the property and assets of this Corporation, to liquidate
the Corporation, or to merge, or consolidate, this Corporation with any other
corporation or to exchange its shares with the shares of any other corporation.
Upon receiving the necessary approval, the Board of Directors shall be
authorized to proceed with any such sale, lease, exchange or merger upon such
terms and conditions and for such consideration as the Board of Directors shall
deem expedient and in the best interest of the Corporation. This provision may
only be amended by an affirmative vote of the holders of eighty (80%) percent of
the outstanding shares of Voting Common Stock.

                  (d) Removal of Directors. Any director may be removed at any
time for cause upon the affirmative vote of a majority of the outstanding Voting
Common Shares or a majority vote of the Board of Directors. Any director may be
removed without cause upon the affirmative vote of the holders of eighty (80%)
percent of the outstanding Voting Common Stock. Any By-Law provision relating to
removal of directors shall be consistent with this provision and may be amended
exclusively by the affirmative vote of the holders of eighty (80%) percent of
the Voting Common Stock.

                  (e) Shareholder Voting Requirements on Other Matters. Except
as provided in subparagraph 9(d) or otherwise authorized in these Articles of
Incorporation, all actions requiring shareholder approval shall be effective on
approval by an affirmative vote of a majority of the shares entitled to vote
thereon, and in the event any class of shares must approve the action, the
affirmative vote of a majority of the shares of the class.

                  (f) Denial of Preemptive Rights. No shareholder of the
Corporation shall have any preemptive or preferential right of subscription to
any shares of any class of the Corporation, whether now or hereafter authorized,
or to any obligations convertible into shares of the Corporation, issued or
sold, nor any right of subscription to any thereof other than such right, if
any, and at such price as the Board of Directors, in its discretion from time to
time may determine, pursuant to the authority hereby conferred by these Articles
of Incorporation, and the Board of Directors may issue shares of the Corporation
or obligations convertible into shares without offering such issue either in
whole or in part to the shareholders of the Corporation, and no holder of Series
A Cumulative Preferred Shares of the Corporation shall have any preemptive or
preferential right to receive any of such shares or obligations declared by way
of dividend.



                                       9
<PAGE>   13

Should the Board of Directors as to any portion of the shares of the
Corporation, whether now or hereafter authorized, or to any obligation
convertible into shares of the Corporation, offer the same to the shareholders
or any class thereof, such offer shall not in any way constitute a waiver or
release of the right of the Board of Directors subsequently to dispense of other
portions of such shares or obligations without so offering the same to the
shareholders. The acceptance of shares in the Corporation shall be a waiver of
any such preemptive or preferential right which in the absence of this provision
might otherwise be asserted by shareholders of the Corporation or any of them.

                  (g) Cumulative Voting Rights. There shall be no cumulative
voting rights for election of directors of this Corporation.

                  (h) Election of Directors. At the first annual meeting of the
shareholders after incorporation, the shareholders eligible to vote shall elect
fifteen (15) persons to serve on the Board of Directors. The terms of those
elected shall be determined as follows: the five (5) directors receiving the
most votes shall serve until the third annual meeting following their selection;
the five (5) directors receiving the next largest number of votes shall serve
until the second annual meeting following their election; the five (5) directors
receiving the fewest votes shall serve until the next annual meeting following
their selection. Thereafter, the Board of Directors may, by majority vote,
increase or decrease the number of directors, provided, there shall be no less
than eleven (11) and no more than fifteen (15) directors at any time. Except as
may otherwise be provided in these Articles of Incorporation, all directors
elected at any annual meeting after the first annual meeting shall be elected to
serve three (3) year terms.



                                       10
<PAGE>   14

                             STATE OF SOUTH CAROLINA
                               SECRETARY OF STATE

                              ARTICLES OF AMENDMENT


TYPE OR PRINT CLEARLY IN BLACK INK

Pursuant Section 3-10-106 of the 1976 South Carolina Code of Laws, as amended,
the undersigned corporation adopts the following Articles of Amendment to its
Articles of Incorporation:

1.       The name of the corporation is Sea Pines Associates, Inc.

2.       Date of Incorporation May 4, 1987.

3.       Agent's Name and Address Stephen P. Birdwell, 32 Greenwood Dr., Hilton
         Head Island, South Carolina 29928.

4.       On December 13, 1999, the corporation adopted the following
         Amendment(s) of its Articles of Incorporation: (Type or attach the
         complete text of each Amendment)


                           SEE ATTACHED EXHIBIT A


5.       The manner, if not set forth in the amendment, in which any exchange,
         reclassification, or cancellation of issued shares provided for in the
         Amendment shall be effected, is as follows: (if not applicable, insert
         "not applicable" or "NA").


                                 NOT APPLICABLE


6. Complete either a or b, whichever is applicable.

         a.       [        ] Amendment(s) adopted by shareholder action.
                  At the date of adoption of the amendment, the number of
                  outstanding shares of each voting group entitled to vote
                  separately on the Amendment, and the vote of such shares was:

------- ------------------ --------------- --------------- ---------------------
        Number of          Number of Votes Number of Votes Number of Undisputed*
Voting  Outstanding Shares Entitled to be  Represented at          Shares
Group                      Cast            the meeting              For
                                                                  Against
------- ------------------ --------------- --------------- ---------------------

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



<PAGE>   15

                                                      SEA PINES ASSOCIATES, INC.
                                                             Name of Corporation

*NOTE:        Pursuant to Section 33-10-106(6)(i) of the 1976 South Carolina
              Code of Laws, as amended, the corporation can alternatively state
              the total number of disputed shares cast for the amendment by each
              voting group together with a statement that the number of cast for
              the amendment by each voting group was sufficient for approval by
              that voting group.

         b.   [X]  The Amendment(s) was duly adopted by the incorporators or
                   board of directors without shareholder approval pursuant to
                   Section 33-6-102(d), 33-10-102, and 33-10-105 of the 1976
                   South Carolina Code as amended, and shareholder action was
                   not required.

7.       Unless a delayed date is specified, the effective date of these
         Articles of Amendment shall be the date of acceptance for filing by the
         Secretary of State (See Section 33-1-230(b) of the 1976 South Carolina
         Code of Laws, as amended):

Date:    Jan. 24, 2000                SEA PINES ASSOCIATES, INC.
       --------------------         --------------------------------------------
                                    Name of Corporation

                                    s/Michael E. Lawrence
                                    --------------------------------------------
                                    Signature

                                    Michael E. Lawrence, Chief Executive Officer
                                    --------------------------------------------
                                    Type or Print Name and Office


                               FILING INSTRUCTIONS

1.       Two copies of this form, the original and either a duplicate original
         or a conformed copy, must be filed.

2.       If the space in this form is insufficient, please attach additional
         sheets containing a reference to the appropriate paragraph in this
         form.

3.       Filing fees and taxes payable to the Secretary of State at the time of
         filing application.

                  Filing Fee                                  $  10.00
                  Filing tax                                    100.00
                                                              --------
                  Total:                                       $110.00

         Return to:        Secretary of State
                           P.O. Box 11350
                           Columbia, SC 29211



                                       2
<PAGE>   16



                                    EXHIBIT A

                                AMENDMENT TO THE
                            ARTICLES OF INCORPORATION
                                       OF
                           SEA PINES ASSOCIATES, INC.

         The Articles of Incorporation of Sea Pines Associates, Inc. are amended
as follows: The number 3,000 is hereby deleted from paragraph 4(a)(3)(i) thereof
and the number 20,000 is substituted in lieu thereof:


<PAGE>   17

                             STATE OF SOUTH CAROLINA
                               SECRETARY OF STATE

                              ARTICLES OF AMENDMENT





         Pursuant ss. Section 3-10-106 of the 1976 South Carolina Code, as
amended, the undersigned corporation adopts the following Articles of Amendment
to its Articles of Incorporation:

1.       The name of the corporation is SEA PINES ASSOCIATES, INC.

2.       On March 4, 1989 , the corporation adopted the following Amendment(s)
of its Articles of Incorporation:

              (Type or attach the complete text of Each Amendment)



                         See Exhibit A attached hereto.


3.       The manner, if not set forth in the amendment, in which any exchange,
reclassification, or cancellation of issued shares provided for in the Amendment
shall be effected, is as follows: (if not applicable, insert "not applicable" or
"NA").


                                       NA


4.       Complete either a or b, whichever is applicable.

         a. [X] Amendment(s) adopted by shareholder action.

         At the date of adoption of the amendment, the number of outstanding
shares of each voting group entitled to vote separately on the Amendment, and
the vote of such shares was:

<TABLE>
<CAPTION>
                        Number of      Number of Votes    Number of Votes       Number of Undisputed*
Voting                  Outstanding    Entitled to be     Represented at the    Shares Voted
Group                   Shares         Cast               meeting               For          Against
------                  -----------    ---------------    ------------------    ---------------------
<S>                     <C>            <C>                <C>                   <C>
Common Stock, no par    1,873,500      1,873,500          1,555,000             1,477,067      -0-
value

                                                                                Abstain:  77,933
</TABLE>



*NOTE:        Pursuant to Section 33-10-106(6)(i), the corporation can
              alternatively state the total number of undisputed shares cast for
              the amendment by each voting group together with a statement that
              the number of cast for the amendment by each voting group was
              sufficient for approval by that voting group.


<PAGE>   18

         b.   [ ]  The Amendment(s) was duly adopted by the incorporators or
                   board of directors without shareholder approval pursuant to
                   ss.33-6-102(d), 33,10-102 and 33-10-105 of the 1976 South
                   Carolina Code as amended, and shareholder action was not
                   required.

5.       Unless a delayed date is specified, the effective date of these
         Articles of Amendment shall be the date of acceptance for filing by the
         Secretary of State (See ss.33-1-230(b)):

DATE:    March 4, 1989                    SEA PINES ASSOCIATES, INC.
         -------------------            ----------------------------------------
                                                 (Name of Corporation)

                                        By: s/Francis S. Webster, Jr.
                                            ------------------------------------

                                            Francis S. Webster, Jr. - Treasurer
                                            ------------------------------------
                                            (Type or print name and office)


                               FILING INSTRUCTIONS

1.       Two copies of this form, the original and either a duplicate original
         or a conformed copy, must be filed.

2.       If the space in this form is insufficient, please attach additional
         sheets containing a reference to the appropriate paragraph in this
         form.

3.       Filing fees and taxes payable to the Secretary of State at the time of
         filing application.

                  Filing Fee                                  $ 10.00
                  Filing tax                                   100.00
                                                              -------
                  Total:                                      $110.00



                                       2
<PAGE>   19



                                    EXHIBIT A

                                AMENDMENT TO THE
                            ARTICLES OF INCORPORATION
                                       OF
                           SEA PINES ASSOCIATES, INC.

         The Articles of Incorporation of Sea Pines Associates, Inc. are amended
as follows: Paragraph 9(h) of the Articles of Incorporation is deleted in its
entirety and the following is substituted in the place thereof:

             (h) Election of Directors. The Board of Directors shall consist of
             not less than nine (9) nor more than eighteen (18) persons, as
             determined by the Board of Directors from time to time. The
             Directors shall be divided into three (3) groups as specified by
             the Board of Directors, with each group containing one-third (1/3)
             of the total Directors of the Corporation, as near as may be. The
             terms of Directors in the first group shall expire at the 1989
             Annual Shareholders Meeting; the terms of Directors in the second
             group shall expire at the 1990 Annual Shareholders Meeting; and the
             terms of Directors in the third group shall expire at the 1991
             Annual Shareholders Meeting. At each Annual Shareholders Meeting
             held thereafter, Directors shall be chosen for terms of three (3)
             years, to succeed those Directors whose terms expire. Irrespective
             of the foregoing, the Corporation shall elect sufficient Directors
             at the 1989 Annual Shareholders Meeting so as to have sixteen (16)
             Directors, divided into three (3) groups; and thereafter, the Board
             of Directors may increase or decrease the number of Directors as
             deemed appropriate within the range set forth hereinabove. Subject
             to the limitations provided hereinabove, any modification in the
             number of the Directors shall be accomplished by an adoption of an
             appropriate Resolution of the Board of Directors specifying (A) the
             total increase or decrease in the number of Directors, (B) the
             increase or decrease in each of the three (3) groups (with the
             change in number of each group to be limited to one-third (1/3) of
             the total, as near as may be), and (C) when vacancies created by
             increases in the number of Directors shall be filled; provided,
             however, that no reduction in the size of the Board of Directors
             shall result in decreasing of the term of any Director then serving
             the Corporation.


<PAGE>   20

                             STATE OF SOUTH CAROLINA
                               SECRETARY OF STATE

                              ARTICLES OF AMENDMENT


         Pursuant ss. Section 3-10-106 of the 1976 South Carolina Code, as
amended, the undersigned corporation adopts the following Articles of Amendment
to its Articles of Incorporation:

1.       The name of the corporation is SEA PINES ASSOCIATES, INC.

2.       On August 23, 1993 , the corporation adopted the following Amendment(s)
of its Articles of Incorporation:

              (Type or attach the complete text of Each Amendment)



                         See Exhibit A attached hereto.




3.       The manner, if not set forth in the amendment, in which any exchange,
reclassification, or cancellation of issued shares provided for in the Amendment
shall be effected, is as follows: (if not applicable, insert "not applicable" or
"NA").

                                       NA

4.       Complete either a or b, whichever is applicable.

         a. [ ]   Amendment(s) adopted by shareholder action.

         At the date of adoption of the amendment, the number of outstanding
shares of each voting group entitled to vote separately on the Amendment, and
the vote of such shares was:

------ ----------- --------------- ------------------ ---------------------
       Number of   Number of Votes Number of Votes    Number of Undisputed*
Voting Outstanding Entitled to be  Represented at the Shares Voted
Group  Shares      Cast            meeting            For           Against
------ ----------- --------------- ------------------ ---------------------

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

*NOTE:        Pursuant to Section 33-10-106(6)(i), the corporation can
              alternatively state the total number of undisputed shares cast for
              the amendment by each voting group together with a statement that
              the number of cast for the amendment by each voting group was
              sufficient for approval by that voting group.


<PAGE>   21

         b.  [X]   The Amendment(s) was duly adopted by the incorporators or
                   board of directors without shareholder approval pursuant to
                   ss.33-6-102(d), 33-10-102 and 33-10-105 of the 1976 South
                   Carolina Code as amended, and shareholder action was not
                   required.

5.       Unless a delayed date is specified, the effective date of these
         Articles of Amendment shall be the date of acceptance for filing by the
         Secretary of State (See ss.33-1-230(b)):

DATE:    August 30, 1993             Sea Pines Associates, Inc .
         ------------------         --------------------------------------------
                                             (Name of Corporation)
                                    By: s/Douglaw H. Haight
                                        ----------------------------------------

                                        Douglas H. Haight. - Secretary
                                        ----------------------------------------
                                            (Type or print name and office)


                               FILING INSTRUCTIONS

1.       Two copies of this form, the original and either a duplicate original
         or a conformed copy, must be filed.

2.       If the space in this form is insufficient, please attach additional
         sheets containing a reference to the appropriate paragraph in this
         form.

3.       Filing fees and taxes payable to the Secretary of State at the time of
         filing application.

                  Filing Fee                   $  10.00
                  Filing tax                     100.00
                                               --------
                  Total:                       $ 110.00


                                       2
<PAGE>   22

                   AMENDMENT TO THE ARTICLES OF INCORPORATION
                          OF SEA PINES ASSOCIATES, INC.

         The Articles of Incorporation of Sea Pines Associates, Inc. are amended
as follows: Paragraph 4(a) of the Articles of Incorporation is amended by adding
thereto subparagraph (3) as follows:

         (3)      Series B Junior Cumulative Preferred Shares.

                  (i) Designation and Amount. The shares of such series shall be
designated as "Series B Junior Cumulative Preferred Shares" and the number of
shares constituting such shares shall be 3,000.

                  (ii) Dividends and Distributions.

         (A) Subject to the prior and superior rights of the holders of any
shares of any series of Preferred Shares (including without limitation, holders
of shares of Series A Cumulative Preferred Shares) ranking prior and superior to
the shares of Series B Junior Cumulative Preferred Shares with respect to
dividends, holders of shares of Series B Junior Cumulative Preferred Shares, in
preference to the holders of Voting Common Shares, without par value (the
"Common Shares"), of the Corporation, and of any other junior stock (including,
without limitation, Non Voting Common Shares, without par value, and Special
Common Shares, without par value), shall be entitled to receive, when, as and if
declared by the Board of Directors out of funds legally available for the
purpose, quarterly dividends payable in cash on August 23, November 23, February
23 and May 23 in each year (each such date being referred to herein as a
"Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction of a share of
Series B Junior Cumulative Preferred Shares, in an amount per share (rounded to
the nearest cent) equal to the greater of (a) $0.25 or (b) the Antidilution
Number (as hereafter defined) times the aggregate per share amount of all cash
dividends and the Antidilution Number times the aggregate per share amount
(payable in kind) of all non cash dividends or other distributions other than a
dividend payable in Common Shares or a subdivision of the outstanding Common
Shares (by reclassification or otherwise) declared on the Common Shares since
the immediately preceding Quarterly Dividend Payment Date, or, with respect to
the First Quarterly Dividend Payment Date, since the first issuance of any share
or fraction of a share of Series B Junior Cumulative Preferred Shares. The
"Antidilution Number" shall initially be 1,000. In the event the Corporation
shall at any time after August 23, 1993 (the "Rights Declaration Date") (i)
declare any dividend on Common Shares payable in Common Shares, (ii) subdivide
the outstanding Common Shares, or (iii) combine the outstanding Common Shares
into a smaller number of shares, then in each such case the Antidilution Number
in effect immediately prior to such event shall be adjusted by multiplying the
Antidilution Number by a fraction the numerator of which is the number of Common
Shares outstanding immediately after such event and the denominator of which is
the number of Common Shares that were outstanding immediately prior to such
event.

         (B) The Corporation shall declare a dividend or distribution on the
Series B Junior Cumulative Preferred Shares as provided in subparagraph
(3)(ii)(A) of this Paragraph 4(a) immediately after it declares a dividend or
distribution on the Common Shares (other than a dividend payable in Common
Shares); provided that, in the event no dividend or distribution shall have been
declared on the Common Shares during the period between any Quarterly Dividend
Payment Date and the next subsequent Quarterly Dividend Payment Date, a dividend
of $0.25 per share on the Series B Junior Cumulative Preferred Shares shall
nevertheless be payable on such subsequent Quarterly Dividend Payment Date.

         (C) Dividends shall begin to accrue and be cumulative on outstanding
shares of Series B Junior Cumulative Shares from the Quarterly Dividend Payment
Date next preceding the date of issue of such shares of Series B Junior
Cumulative Preferred Shares, unless the issue date of such shares is a Quarterly
Dividend Payment Date or is a date after the record date for the determination
of holders of shares of Series B Junior Cumulative Preferred Shares entitled to
receive a quarterly dividend and before such Quarterly Dividend Payment Date, in
either of which events such dividends shall begin to accrue



                                      A-1
<PAGE>   23

and be cumulative from such Quarterly Dividend Payment Date. Accrued but unpaid
dividends shall not bear interest. Dividends paid on the shares of Series B
Junior Cumulative Preferred Shares in an amount less than the total amount of
such dividends at the time accrued and payable on such shares shall be allocated
pro rata on a share-by-share basis among all such shares at the time
outstanding. The Board of Directors may fix a record date for the determination
of holders of shares of Series B Junior Cumulative Preferred Shares entitled to
receive payment of a dividend or distribution declared thereon, which record
date shall be no more than 30 days prior to the date fixed for the payment
thereof.

                  (iii) Voting Rights. The holders of shares of Series B Junior
Cumulative Preferred Shares shall have the following voting rights:

                           (A) Each share of Series B Junior Cumulative
Preferred Shares shall entitle the holder thereof to the number of votes equal
to the Antidilution Number on all matters submitted to a vote of the
shareholders of the Corporation.

                           (B) Except as otherwise provided herein by law or in

these Articles of Incorporation, the holders of shares of Series B Junior
Cumulative Preferred Shares and the holders of Common Shares shall vote together
as one class on all matters submitted to a vote of shareholders of the
Corporation.

                           (C) (v) If at any time dividends on any Series B
Junior Cumulative Preferred Shares shall be in arrears in an amount equal to six
(6) dividends thereon, the occurrence of such contingency shall mark the
beginning of a period (herein called a "default period") which shall extend
until such time when all accrued and unpaid dividends for all previous quarterly
dividend periods and for the current quarterly dividend period on all shares of
Series B Junior Cumulative Preferred Shares then outstanding shall have been
declared and paid or set apart for payment. During each default period, all
holders of Preferred Stock (including holders of the Series B Junior Cumulative
Preferred Shares) with dividends in arrears in an amount equal to six (6)
quarterly dividends thereon, voting as a class irrespective of series, shall
have the right to elect two (2) Directors.

                                    (w) During any default period such voting
right of the holders of Series B Junior Cumulative Preferred Shares may be
exercised initially at a special meeting called pursuant to subparagraph
(3)(iii)(C)(x) of this Paragraph 4(a) or at any other annual or special meeting
of shareholders, and thereafter at annual meetings of shareholders, provided
that such voting right to increase, in certain cases, the authorized number of
Directors shall not be exercised unless the holders of ten percent (10%) in
number of shares of Series B Junior Cumulative Preferred Shares outstanding
shall be present in person or by proxy. The absence of a quorum of the holders
of Common Shares shall not affect the exercise by the holders of Series B
Cumulative Preferred Shares of such voting right. At any meeting at which the
holders of Series B Junior Cumulative Preferred Shares shall exercise such
voting right initially during an existing default period, they shall have the
right voting as a class, to elect Directors to fill such vacancies, if any, in
the Board of Directors as may then exist up to two (2) Directors or, if such
right is exercised at an annual meeting, to elect two (2) Directors. If the
number which may be so elected at any special meeting does not amount to the
required number, the holders of the Preferred Shares shall have the right to
make such increase in the number of Directors as shall be necessary to permit
the election by them of the required number. After the holders of the Series B
Junior Cumulative Preferred Shares shall have exercised their right to elect
Directors in any default period and during the continuance of such period, the
number of Directors shall not be increased or decreased except by vote of the
holders of Series B Junior Cumulative Preferred Shares as herein provided or
pursuant to the rights of any securities ranking senior to or pari passu with
the Series B Junior Cumulative Preferred Shares.

                                    (x) Unless the holders of Series B Junior
Cumulative Preferred Shares shall, during an existing default period, have
previously exercised their right to elect the Directors, the Board of Directors
may order, or any shareholder or shareholders owning in the aggregate not less
than ten percent (10%) of the total number of shares of Series B Junior
Cumulative Preferred Shares outstanding, may request, the calling of a special
meeting of the holders of Series B Junior Cumulative Preferred Shares, which
meeting shall thereupon be called by the President, a Vice President or the



                                      A-2
<PAGE>   24
 Secretary of the Corporation. Notice of such meeting and of any annual meeting
at which holders of Series B Junior Cumulative Preferred Shares are entitled to
vote pursuant to this subparagraph (3)(iii)(C)(x) shall be given to each holder
of record of Series B Junior Cumulative Preferred Shares by mailing a copy of
such notice to him at his last address as the same appears on the books of the
Corporation. Such meeting shall be called for a time not earlier than 20 days
and not later than 60 days after such order or request or in default of the
calling of such meeting within 60 days after such order or request, such meeting
may be called on similar notice by any shareholder or shareholders owning in the
aggregate not less than ten percent (10%) of the total number of shares of
Series B Junior Cumulative Preferred Shares outstanding. Notwithstanding the
provisions of this Paragraph 3(iii)(C)(x), no such special meeting shall be
called during the period within 60 days immediately preceding the date fixed for
the next annual meeting of the shareholders.

                                    (y) In any default period, the holders of
Common Shares, and other classes of stock of the Corporation if applicable,
shall continue to be entitled to elect the whole number of Directors until the
holders of Series B Junior Cumulative Preferred Shares shall have exercised
their right to elect two (2) Directors voting as a class, after the exercise of
which right (i) the Directors so elected by the holders of Series B Junior
Cumulative Preferred Shares shall continue in office until their successors
shall have been elected by such holders or until the expiration of the default
period, and (ii) any vacancy in the Board of Directors may (except as provided
in subparagraph (3)(iii)(C)(w) of this Paragraph 4(a)) be filled by vote of a
majority of the remaining Directors theretofore elected by the holders of a
particular class of stock which elected the Director whose office shall have
become vacant. References in this subparagraph 3(iii)(C) to Directors elected by
the holders of a particular class of stock shall include Directors elected by
such Directors to fill vacancies provided in clause (i) of the foregoing
sentence.

                                    (z) Immediately upon the expiration of a
default period, (i) the right of the holders of Series B Junior Cumulative
Preferred Shares as a class to elect Directors shall cease, (ii) the term of any
Directors elected by the holders of Series B Junior Cumulative Preferred Shares
as a class shall terminate, and (iii) the number of Directors shall be such
number as may be provided for in these Articles of Incorporation or in the
by-laws irrespective of any increase made pursuant to the provisions of
subparagraph 3(iii)(C)(w) of this Paragraph 4(a) (such number being subject,
however, to change thereafter in any manner provided by law or in the Articles
of Incorporation or by-laws). Any vacancies in the Board of Directors effected
by the provisions of clauses (ii) and (iii) in the preceding sentence may be
filled by a majority of the remaining Directors.

                           (D) Except as set forth herein, holders of Series B
Junior Cumulative Preferred Shares shall have no special voting rights and their
consent shall not be required (except to the extent they are entitled to vote
with holders of Common Shares as set forth herein) for taking any corporate
action.

                  (iv) Certain Restrictions.

                  (A) Whenever quarterly dividends or other dividends or
distributions payable on the Series B Junior Cumulative Preferred Shares as
provided in subparagraph (3)(ii) of this Paragraph 4(a) are in arrears,
thereafter and until all accrued and unpaid dividends and distributions, whether
or not declared, on shares of Series B Junior Cumulative Preferred Shares
outstanding shall have been paid in full, the Corporation shall not

                                    (w) declare or pay dividends on, make any
                           other distributions on, or redeem or purchase or
                           otherwise acquire for consideration any shares of
                           stock ranking junior (either as to dividends or upon
                           liquidation, dissolution or winding up) to the Series
                           B Junior Cumulative Preferred Shares;

                                    (x) declare or pay dividends on or make any
                           other distributions on any shares of stock ranking on
                           a parity (either as to dividends or upon liquidation,
                           dissolution or winding up) with the Series B Junior
                           Cumulative Preferred Shares, except dividends paid
                           ratably on the Series B Junior Cumulative Preferred



                                      A-3
<PAGE>   25

                           Shares and all such parity stock on which dividends
                           are payable or in arrears in proportion to the total
                           amounts to which the holders of all such shares are
                           then entitled;

                                    (y) redeem or purchase or otherwise acquire
                           for consideration shares of any stock ranking on a
                           parity (either as to dividends or upon liquidation,
                           dissolution or winding up) with the Series B Junior
                           Cumulative Preferred Shares, provided that the
                           Corporation may at any time redeem, purchase or
                           otherwise acquire any shares of any such parity stock
                           in exchange for shares of any stock of the
                           Corporation ranking junior (either as to dividends or
                           upon dissolution, liquidation or winding up) to the
                           Series B Junior Cumulative Preferred Shares; or

                                    (z) purchase or otherwise acquire for
                           consideration any shares of Series B Junior
                           Cumulative Preferred Shares, or any shares of stock
                           ranking on a parity with the Series B Junior
                           Cumulative Preferred Shares, except in accordance
                           with a purchase offer made in writing or by
                           publication (as determined by the Board of Directors)
                           to all holders of such shares upon such terms as the
                           Board of Directors, after consideration of the
                           respective annual dividend rates and other relative
                           rights and preferences of the respective series and
                           classes, shall determine in good faith will result in
                           fair and equitable treatment among the respective
                           series or classes.

                  (B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any shares of
stock of the Corporation unless the Corporation could, under subparagraph
3(iv)(A) of this Paragraph 4(a) purchase or otherwise acquire such shares at
such time and in such manner.

                  (v) Reacquired Shares. Any shares of Series B Junior
Cumulative Preferred Shares purchased or otherwise acquired by the Corporation
in any manner whatsoever, shall be retired and cancelled promptly after the
acquisition thereof. All such shares shall upon their cancellation become
authorized but unissued shares of Preferred Shares and may be reissued as part
of a new series of Preferred Shares to be created by resolution or resolutions
of the Board of Directors, subject to the conditions and restrictions on
issuance set forth herein.

                  (vi) Liquidation, Dissolution or Winding Up.

                  (A) Upon any liquidation (voluntary or otherwise), dissolution
or winding up of the Corporation, no distribution shall be made to the holders
of shares of stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series B Junior Cumulative Preferred Shares
unless, prior thereto, the holders of Series B Junior Cumulative Preferred
Shares shall have received $100 per share, plus an amount equal to accrued and
unpaid dividends and distribution thereon, whether or not declared, to the date
of such payment (the "Series B Liquidation Preference"). Following the payment
of the full amount of Series B Liquidation Preference, no additional
distributions shall be made to the holders of shares of Series B Junior
Cumulative Preferred Shares unless, prior thereto, the holders of Common Shares
shall have received an amount per share (the "Common Adjustment") equal to the
quotient obtained by dividing the Series B Liquidation Preference by the
Antidilution Number. Following the payment of the full amount of Series B
Liquidation Preference and the Common Adjustment in respect of all outstanding
shares of Series B Junior Cumulative Preferred Shares and Common Shares,
respectively, holders of Series B Junior Cumulative Preferred Shares and holders
of Common Shares shall receive their ratable and proportionate shares of the
remaining assets to be distributed in the ratio of the Antidilution Number to
one with respect to such Series B Junior Cumulative Preferred Shares and Common
Shares, on a per share basis, respectively.

                  (B) In the event, however, that there are not sufficient
assets available to permit payment in full of the Series B Liquidation
Preference and the liquidation preferences of all other series of preference
stock, if any, which rank on a parity with the Series B Junior Cumulative
Preferred Shares,



                                      A-4
<PAGE>   26

then such remaining assets shall be distributed ratably to the holders of such
parity shares in proportion to their respective liquidation preferences. In the
event, however, that there are not sufficient assets available to permit payment
in full of the Common Adjustment, then such remaining assets shall be
distributed ratably to the holders of Common Shares.

                  (vii) Consolidation, Merger, etc. In case the Corporation
shall enter into any consolidation, merger, combination or other transaction in
which the Common Shares are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case the shares of
Series B Junior Cumulative Preferred Shares shall at the same time be similarly
exchanged or changed in an amount per share (subject to the provision for
adjustment hereinafter set forth) equal to the Antidilution Number times the
aggregate amount of stock, securities, cash, and/or any other property (payable
in kind), as the case may be, and to which or for which each Common Share is
changed or exchanged.

                  (viii) No Redemption. The Series B Junior Cumulative Preferred
Shares shall not be redeemable.

                  (ix) Ranking. The Series B Junior Cumulative Preferred Shares
shall rank junior to all other series of the Corporation's Preferred Shares as
to the payment of dividends and the distribution of assets, unless the terms of
such series shall provide otherwise.

                  (x) Fractional Shares. Series B Junior Cumulative Preferred
Shares may be issued in fractions of a share which shall entitle the holder in
proportion to such holders of fractional shares, to exercise voting rights,
receive dividends, participate in distributions and to have the benefit of all
other rights of holders of Series B Junior Cumulative Preferred Shares.



                                      A-5
<PAGE>   27

                             STATE OF SOUTH CAROLINA
                               SECRETARY OF STATE

                              ARTICLES OF AMENDMENT


         Pursuant to ss.33-10-106 of the South Carolina Business Corporation Act
of 1988, as amended, the undersigned corporation adopts the following Articles
of Amendment to its Articles of Incorporation:

         1. The name of the corporation is SEA PINES ASSOCIATES, INC.

         2. On March 3, 1990, the corporation adopted by vote of its
shareholders at its annual meeting of shareholders the following amendment to
its Articles of Incorporation:

Paragraph 4 of the Articles of Incorporation of the corporation is amended so as
to read in its entirety as follows:

                  "4. The corporation is authorized to issue shares of stock as
                  follows:

             Class of Shares      Authorized No. of Each Class      Par Value
             ---------------      ----------------------------      ---------
             Preferred            5,000,00                            None

             Voting Common        20,000,000                          None

             Non-Voting Common    1,000,000                           None

             Special Common       2,000,000                           None"



         3. At the date of adoption of the amendment, there were 1,873,500
outstanding shares of the corporation's voting common stock, which shares
constituted all of the outstanding shares of the corporation entitled to be
voted on the amendment. Of the 1,873,500 votes entitled to be cast, 1,278,000
votes were represented at the annual meeting (either in person or by proxy) and
the vote of such shares was:

                         No. of Undisputed Shares Voted:

                  For                       Against                    Abstain
                  ---                       -------                    -------
                  1,049,250                 186,000                    42,750




<PAGE>   28

         4. The effective date of these Articles of Amendment shall be the date
of acceptance for filing by the Secretary of State.

Date:  January 28, 1993                   SEA PINES ASSOCIATES, INC.

                                          By:         s/Charles F. Bacon
                                              ----------------------------------
                                              Charles F. Bacon
                                              Chairman of the Board of Directors


                                       2
<PAGE>   29

                             STATE OF SOUTH CAROLINA
                               SECRETARY OF STATE

                      NOTICE OF CHANGE OF REGISTERED OFFICE
                           OR REGISTERED AGENT OR BOTH
                               OF A SOUTH CAROLINA
                             OR FOREIGN CORPORATION

         Pursuant to ss.ss. 33-5-102 and 33-15-108 of the 1976 South Carolina
Code, as amended, the undersigned corporation submits the following information.

1.       The name of the corporation is SEA PINES ASSOCIATES, INC.

2.       The corporation is (complete either a or b, whichever is applicable):

  xx     a. a domestic corporation incorporated in South Carolina on 5/4/87 ; or
         b. a foreign corporation incorporated in ______________ on _________
                                                         (State)        (Date)
         and authorized to do business in South Carolina on                    .
                                                                 (Date)

3.       The street address of the current registered office in South Carolina
         is 16 PIPING PLOVER
           (Street & Number)
         in the city of HILTON HEAD ISLAND, South Carolina 29928.
                                                         (Zip Code)

4.       If the current registered office is to be changed, the street address
         to which its registered office is to be changed is 17 Governors Lane in
                                                            (Street & Number)
         the city of Hilton Head, South Carolina 29928
                                              (Zip Code)

5.       The name of the present registered agent is PAUL T. CLARK.
                                                     --------------

6.       If the current registered agent is to be changed, the name of the
         successor registered agent is Douglas H. Haight .

         * I hereby consent to the appointment as registered agent of the
         corporation:

                               s/Douglas H. Haight
                       -----------------------------------
                       (Signature of New Registered Agent)

7.       The address of the registered office and the address of the business
         office of the registered agent, as changed, will be identical.

8.       Unless a delayed date is specified, this application will be effective
         upon acceptance for filing by the Secretary of State (See ss.
         33-1-230(b)):________________________.


*        Pursuant to ss.ss.33-9-102(5) and 33-19-108(5), the written consent of
         the registered agent may be attached to this form.


<PAGE>   30


9.       Dated this 14th day of OCT, 1994


                                                   SEA PINES ASSOCIATES, INC.
                                                   -----------------------------
                                                   (Name of Corporation)


                                               By: s/Douglas H. Haight
                                                   -----------------------------
                                                   Douglas H. Haight




                               FILING INSTRUCTIONS

1.       Two copies of this form, the original and either a duplicate original
         or a conformed copy, must be filed.

2.       Filing Fee (payable to the Secretary of State at the time of filing
         this document) -- $10.00

3.       Pursuant to ss.33-5-102(b), the registered agent can file this form
         when the only change is changing the street address of the registered
         office. In this situation, the following statement should be typed on
         the form above the registered agent's signature: "The corporation has
         been notified of this change."


<PAGE>   31

                             STATE OF SOUTH CAROLINA
                               SECRETARY OF STATE

                      NOTICE OF CHANGE OF REGISTERED OFFICE
                           OR REGISTERED AGENT OR BOTH
                               OF A SOUTH CAROLINA
                             OR FOREIGN CORPORATION

TYPE OR PRINT CLEARLY IN BLACK INK

         Pursuant to ss.ss. 33-5-102 and 33-15-108 of the 1976 South Carolina
Code of Laws, as amended, the undersigned corporation submits the following
information.

1.       The name of the corporation is Sea Pines Associates, Inc.

2.       The corporation is (complete either a or b, whichever is applicable):

[xx]     a. a domestic corporation incorporated in South Carolina on May 4,
            1987; or

[  ]     b. a foreign corporation incorporated in __________ on ______, and
                                                   State        Date
         authorized to do business in South Carolina on _______________________.
                                                               Date

3.       The street address of the present registered office in South Carolina
         is 17 Governors Lane in the city of Hilton Head Island,
             Street & Number

         South Carolina   29928.
                        Zip Code

4.       If the current registered office is to be changed, the street address
         to which its registered office is to be changed is 32 Greenwood Drive
                                                            (Street & Number)

         in the city of Hilton Head Island, South Carolina   29928
                                                           (Zip Code)

5.       The name of the present registered agent is   Douglas H. Haight.
                                                     -------------------

6.       If the current registered agent is to be changed, the name of the
         successor registered agent is Stephen P. Birdwell.

         * I hereby consent to the appointment as registered agent of the
         corporation:

                             s/Stephen P. Birdwell
                       -----------------------------------
                       (Signature of New Registered Agent)

7.       The address of the registered office and the address of the business
         office of the registered agent, as changed, will be identical.

8.       Unless a delayed date is specified, this application will be effective
         upon acceptance for filing by the Secretary of State (See ss.
         33-1-230(b) of the 1976 South Carolina Code of Laws, as amended):
         _________________________.


         *Pursuant to Sections 33-9-102(5) and 33-19-108(5) of the 1976 South
         Carolina Code of Laws, as amended, the written consent of the
         registered agent may be attached to this form.


<PAGE>   32


9.       Date     Jan. 24, 2000
                  -------------

                                SEA PINES ASSOCIATES, INC.
                                --------------------------
                                   Name of Corporation


                                By: s/Michael E. Lawrence
                                    --------------------------------------------
                                    Signature

                                    Michael E. Lawrence, Chief Executive Officer
                                    --------------------------------------------
                                    Type or Print Name and Title






                               FILING INSTRUCTIONS

1.       Two copies of this form, the original and either a duplicate original
         or a conformed copy, must be filed.

2.       Filing Fee (payable to the Secretary of State at the time of filing
         this document) -- $10.00

3.       Pursuant to ss.33-5-102(b) of the 1976 South Carolina Code of Laws, as
         amended, the registered agent can file this form when the only change
         is changing the street address of the registered office. In this
         situation, the following statement should be typed on the form above
         the registered agent's signature: "The corporation has been notified of
         this change." in this case the filing fee is $2.00.

         Return to:        Secretary of State
                           P.O. Box 11350
                           Columbia, SC  29211