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                               WACHOVIA BANK, N.A.


                           SEA PINES ASSOCIATES, INC.
                                       AND
                             SEA PINES COMPANY, INC.
                             MASTER CREDIT AGREEMENT





                                OCTOBER 31, 1998


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                                TABLE OF CONTENTS

ARTICLE I.        DEFINITIONS..............................................  1

ARTICLE II.       CROSS COLLATERALIZATION, CROSS DEFAULT, AND
                  JOINT AND SEVERAL LIABILITY..............................  10

ARTICLE III.      THE REVOLVING LOAN FACILITY .............................  10

ARTICLE IV.       THE SEASONAL LINE OF CREDIT FACILITY ....................  16

ARTICLE V.        THE TERM LOAN FACILITY...................................  17

ARTICLE VI.       CONDITIONS PRECEDENT.....................................  19

ARTICLE VII.      REPRESENTATIONS AND WARRANTIES...........................  20

ARTICLE VIII.     BORROWER'S AFFIRMATIVE COVENANTS.........................  22

ARTICLE IX.       BORROWER'S NEGATIVE COVENANTS............................  30

ARTICLE X.        EVENTS OF DEFAULT........................................  34

ARTICLE XI.       REMEDIES.................................................  36

ARTICLE XII.      MISCELLANEOUS PROVISIONS.................................  38

SCHEDULE I        COMPLIANCE CERTIFICATE...................................  S-1

SCHEDULE II       ASSET RELEASE SCHEDULE...................................  S-3



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         THIS MASTER CREDIT AGREEMENT is entered into as of October 31, 1998 by
SEA PINES ASSOCIATES, INC. and SEA PINES COMPANY, INC., both corporations
organized and existing under the laws of the State of South Carolina
(collectively the "Borrower") and WACHOVIA BANK, N.A., a national banking
association (the "Bank").

         WHEREAS, the Borrower and the Bank desire to establish uniform
agreements, obligations, covenants and other matters for all Obligations, as
defined, whether now existing or hereinafter arising, owed to the Bank and to
collateralize and cross-default all said Obligations, as defined.

         WHEREAS, the Borrower and the Bank also desire to re-establish,
re-state and modify: (1) the Borrower's term loan facility in an amount up to
Eighteen Million Five Hundred Thousand Dollars ($18,500,000) (the "Term Loan
Facility"); (2) the Borrower's revolving line of credit facility in an amount up
to Fifteen Million Dollars ($15,000,000) (the "Revolving Line of Credit
Facility"); and (3) the Borrower's seasonal line of credit facility in an amount
up to Two Million Five Hundred Thousand Dollars ($2,500,000) (the "Seasonal Line
of Credit Facility").

         NOW, THEREFORE, in consideration of these premises and the following
promises and undertakings, the Bank and the Borrower agree as follows:


                             ARTICLE I. DEFINITIONS


         1.01 The following terms shall have the following meanings unless the
context otherwise expressly requires:

                  (a) "Adjusted LIBOR Index" for an applicable Interest Period
shall mean a rate per annum equal to the quotient obtained by dividing (i) the
applicable "LIBOR Index" for such Interest Period by (ii) 1.00 minus the
"Eurodollar Reserve Percentage."

                  (b) "Advance" means each advance, re-advance or loan made to
the Borrower in accordance with this Agreement in any amount designated by the
Borrower.



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                  (c) "Approved Project" means development and construction
projects undertaken by the Borrower located on the Secured Properties which have
been underwritten and approved in writing by the Bank.

                  (d) "Applicable Margin" as to each Note shall mean One and
50/100 percent (1.50%) (150 basis points); provided, that for the Revolving Line
of Credit Note and the Term Loan Note, the Applicable Margin shall be adjusted
to the percentage indicated below for each fiscal quarter based on the
Borrower's DSC Ratio (as defined in ss. 8.02 hereof) for the previous fiscal
quarter:


                          DSC Ratio                 Applicable Margin
                          ---------                 -----------------
                          <  1.50                   1.50% (150 basis points)
                          => 1.50 but <1.75         1.35% (135 basis points)
                          => 1.75                   1.25% (125 basis points)

         The Applicable Margin shall be adjusted as of the first Business Day of
each fiscal quarter based upon the quarterly Compliance Certificate required by
Section 8.01(d) hereof and shall be applicable to the entire then-current fiscal
quarter, including any necessary retroactive adjustment to the first Business
Day of such quarter, and until adjusted as of the first Business Day of the next
fiscal quarter based on the next quarterly Compliance Certificate.

         Notwithstanding the foregoing, in the event the above required
certificate is not received by the Bank within the time period required hereby,
the Applicable Margin shall automatically be 1.50% for the entire then-current
fiscal quarter, including a retroactive adjustment to the first Business Day of
such fiscal quarter, and for each subsequent fiscal quarter until such a
certificate is timely received and the Applicable Margin shall not be adjusted
until the first Business Day of the next fiscal quarter following receipt of
said certificate. 



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                  (e) "Assignment Modification" means modification to the
outstanding Assignments granted to the Bank modified so as to
cross-collateralize and secure the Obligations, as well as provide for
cross-default with the Obligations and other modifications.

                  (f) "Assignments" mean the Assignment of Rents, Leases and
Profits, the Collateral Assignment of Contracts, the Assignment of Tournament
Contracts and Agreements, the Assignment of Permits and Licenses, the Collateral
Assignment of Rights and Easements, the Collateral Assignment of Trademarks,
Trade Names, Intangibles and Proprietary Rights, the Security Agreement, and the
Stock Pledge, all dated November 17, 1987, as amended by the Assignment
Modification and other amendments and all other assignments and pledges granting
security interests to the Bank in the Secured Personalty.

                  (g) "Collateral" means the Secured Properties and the Secured
Personalty and any and all other security or collateral now or hereafter pledged
to the Bank to secure the Obligations.

                  (h) "Commitment Letter" means the Bank's letter of September
9, 1998 to the Borrower regarding the Facilities.

                  (i) "Default Rate" shall mean the then applicable Adjusted
LIBOR Index plus the Applicable Margin and an additional Two (2.00%) percent
(200 basis points).

                  (j) "Documents" mean this Agreement, the Notes, the Mortgages,
the Commitment Letter, the Assignments, the ISDA Agreement, the FMA Agreement
and all other documents, instruments, financing statements, certificates and
other items deemed reasonably necessary to document or evidence the Advances or
the Obligations, all of which are incorporated herein as if set forth in full.

                  (k) "Eurodollar Reserve Percentage" means for any day that
percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum 



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reserve requirement for a member bank of the Federal Reserve System in respect
of "Eurocurrency liabilities" (as adjusted automatically on and as of the
effective date of any change in the Eurodollar Reserve Percentage).

                  (l) "FMA Agreement" means that certain agreement dated May 30,
1997 entered into by and between the Bank and the Borrower relating to the
automated investing and borrowing feature of the Seasonal Line of Credit
Facility.

                  (m) "Facilities" mean the Term Loan Facility, the Revolving
Line of Credit Facility and the Seasonal Line of Credit Facility, as set forth
herein.

                  (n) "Facility Fee" means a fee of $10,000 paid annually by the
Borrower to the Bank for the Revolving Line of Credit Facility and any
additional fees charged for any extension of any of the Facilities, which fees
shall be fully earned when paid and nonrefundable.

                  (o) "Fiscal Year" means November 1 to October 31.

                  (p) "GAAP" means generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board.

                  (q) "Hazardous Materials" mean and shall include, without
limitation, any flammable explosives, radioactive materials, hazardous
materials, hazardous wastes, hazardous or toxic substances, or related or
similar materials, asbestos or any material containing asbestos, or any other
hazardous substance or material as defined by any federal, state or local
environmental law, ordinance, rule or regulation including, without limitation,
the Comprehensive Environmental Response, Compensation, and Liability Act of
1980, as amended, the Hazardous Materials Transportation Act, as amended, the
Resource Conservation and Recovery Act, as amended, the South Carolina Hazardous
Waste Management Act, the South Carolina Pollution 



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Control Act, and in the regulations adopted and publications promulgated
pursuant to any such laws.

                  (r) "ISDA Agreement" means any agreements and related
schedules and transactions executed by and between the Borrower and the Bank in
connection with any interest rate derivative product; including, but not limited
to, an interest rate swap transaction, interest rate cap transaction, interest
rate floor transaction, interest rate collar transaction or other similar
transaction.

                  (s) "Interest Period" for the Term Note and the Seasonal Line
of Credit Note shall mean each successive calendar month, with the first
Interest Period being the period from the date of the applicable Note until the
last day of that calendar month. For the Revolving Line of Credit Note,
"Interest Period" shall mean each successive one, two, three, six or twelve
month period commencing as of the first day of each calendar month, as selected
from time to time by the Borrower in accordance with ss. 3.02 below.

                  (t) "Interest Rate" means the rate of interest as to any
Advance or Obligation as specified in each of the Notes, this Agreement or other
Documents.

                  (u) "LIBOR Index" shall mean for the applicable Interest
Period the rate per annum, at which deposits of United States dollars with
maturities comparable to the applicable Interest Period, that appears on the
display designated as page "3750" of the Telerate Service (or such other page as
may replace page 3750 of that service or such other service or services as may
be designated by the British Bankers' Association for the purpose of displaying
London Interbank Offered Rates for U.S. dollar deposits), determined as of 11:00
a.m. (London time) (rounded upward to the next higher of 1/10,000 of 1%), two
(2) business days prior to the commencement of the applicable Interest Period.
If the Bank should at any time determine that it is not possible to determine
the LIBOR Index or that the LIBOR Index is no longer available, then the
applicable Note(s) shall continue to bear interest at the rate in effect during
the last Interest 



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Period in which the LIBOR Index was available or determinable until the
beginning of the next Interest Period in which the LIBOR Index is available or
determinable.

                  (v) "Material Agreement" means any agreement, lease, contract
or other instrument creating liabilities (whether actual or contingent) or
revenues (whether actual or projected) for the Borrower in excess of $250,000.00
within any Fiscal Year.

                  (w) "Material Adverse Effect" means an event or action which
would impair the ability of either the Borrower or Sea Pines Real Estate
Company, Inc. to carry on its business substantially as now conducted or would
materially and adversely affect the financial condition, business or operations
of either the Borrower or Sea Pines Real Estate Company, Inc. or has a material
impact on the intended uses or the valuation of the Collateral.

                  (x) "Mortgage Modifications" mean modifications to the
outstanding Mortgages granted to the Bank modified to extend the maturity dates,
cross-collateralize and secure the Obligations, as well as provide for
cross-default with the Obligations and other modifications.

                  (y) "Mortgages" mean the Bank's first lien mortgage, security
agreement and fixture filing(s) as applicable encumbering the Secured Properties
(as hereinafter defined), as modified by the Mortgage Modifications, including,
without limitation, the following:

                           (i) Mortgage, Security Agreement and Financing
Statement dated November 17, 1987 as amended;

                           (ii) Mortgage and Security Agreement dated January
17, 1992 as amended; and

                           (iii) Mortgage, Security Agreement and Financing
Statement dated October 15, 1993 as amended.

                  (z) "Notes" mean all promissory notes of the Borrower or any
Subsidiary, whether now existing or hereafter arising, evidencing the
Obligations as appropriately completed, duly authorized and issued to the Bank,
including without limitation the following:



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                           (i) $15,000,000 Amended and Restated Revolving Line
of Credit Note of the Borrower dated as of October 31, 1998 (the "Revolving Line
of Credit Note");

                           (ii) $2,500,000 Amended and Restated Seasonal Line of
Credit Note of the Borrower dated as of October 31, 1998 (the "Seasonal Line of
Credit Note");

                           (iii) $18,500,000 Amended and Restated Term Note of
the Borrower dated as of October 31, 1998 (the "Term Note");

                           (iv) ISDA Agreement and all related transactions now
or hereafter entered into between the Borrower and the Bank; and

                           (v) FMA Agreement entered into by and between the
Borrower and the Bank together with any modifications, renewals or extensions
thereof.

                  (aa) "Obligations" means the joint and several indebtedness
evidenced by the Documents, including but not limited to the Notes, and any and
all other indebtedness or liabilities of the Borrower or any Subsidiary to the
Bank, now or hereafter incurred, however and whenever evidenced, whether direct
or indirect, absolute or contingent, together with all interest accrued thereon.


                  (bb) "Permitted Encumbrances" mean any third-party lien,
security interest, charge or encumbrance upon the Collateral created or existing
with the express written consent of the Bank, any purchase money debt for
equipment, or operating leases, entered into in the ordinary course of business.

                  (cc) "Project Funds" means the maximum amount of funds
designated in writing by the Bank as available to be disbursed from the
Revolving Line of Credit Facility for the development and construction of
Approved Project(s); provided in no event will Project 



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Funds exceed the amounts specified in the Development Cost Analysis (as defined
in Section 3.05) without the prior written consent of the Bank or except as
provided in Section 3.10.

                  (dd) "Project Completion" means the determination by the Bank
of the completion of an Approved Project based upon receipt by the Bank of the
following: (i) an affidavit from the contractor(s) that all labor and materials
supplied in connection with the Approved Project have been (or will with such
final disbursement be) fully paid for and that no rights exist on the part of
any party to claim a lien against the Approved Project or any portion thereof
and/or other evidence that arrangements satisfactory to the Bank have been made
with respect to any such rights or potential claims or claimants; (ii) a
certificate from the record architect that the Approved Project has been
constructed and completed in substantial accordance with the Plans and
Specifications; (iii) a copy of the certificate of occupancy or other document
from appropriate governmental authority evidencing that all the improvements
have been completed in accordance with the applicable governmental requirements;
and (iv) a final as-built survey showing the location of the completed
improvements.

                  (ee) "Revolving Line of Credit Note Maturity Date" means
November 1, 2002 or as extended pursuant to any future commitment letter or
modification hereof executed by the Borrower and the Bank; provided, that this
Maturity Date will extend automatically to November 1, 2003 unless the Bank
gives notice to the Borrower at least thirty (30) days prior to November 1, 1999
that this Maturity Date will not be extended.

                  (ff) "Seasonal Line of Credit Note Maturity Date" means
November 1, 2002 or as extended pursuant to any future commitment letter or
modification hereof executed by the Borrower and the Bank; provided, that this
Maturity Date will extend automatically to November 1, 2003 unless the Bank
gives notice to the Borrower at least thirty (30) days prior to November 1, 1999
that this Maturity Date will not be extended.



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                  (gg) "Secured Personalty" means all receivables, related
contracts and other personal property now or hereafter pledged to the Bank
pursuant to the Assignments or other Documents.

                  (hh) "Secured Properties" mean the real properties, fixtures
and/or facilities as described in the Mortgages.

                  (ii) "Subsidiary" or "Subsidiaries" means Sea Pines Real
Estate Company, Inc., Sea Pines/Tide Pointe, Inc., Sea Pines Senior Living
Center, Inc., Fifth Golf Course Club, Inc., and any other wholly owned
subsidiary, entity or enterprise of the Borrower, excepting, however, Sea Pines
Company, Inc. as Borrower.

                  (jj) "Term Note Maturity Date" means November 1, 2008 or as
extended pursuant to any future commitment letter or modification hereof
executed by the Borrower and the Bank.


               ARTICLE II. CROSS COLLATERALIZATION, CROSS DEFAULT
                         AND JOINT AND SEVERAL LIABILITY

         2.01 All Obligations, including specifically, without limitation, all
Notes, are secured by the Collateral given by the Borrower or its Subsidiaries
to the Bank.

         2.02 The Collateral given by the Borrower or any Subsidiary pursuant to
the Mortgages, the Assignments or other Documents shall secure and
cross-collateralize all Obligations; including, without limitation, all Notes,
owed to the Bank whether now outstanding or arising in the future.

         2.03 An Event of Default or declaration of default under this Agreement
or any of the Obligations, including specifically, without limitation, the
Notes, after the expiration of any applicable grace period contained therein,
shall constitute a default under all other Notes, all Documents, Mortgages or
other instruments securing said Notes and shall entitle the Bank, at its option
to exercise all rights and remedies thereunder.



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         2.04 An Event of Default or declaration of default under any of the
Notes, Documents or Mortgages or other instruments after the expiration of any
applicable grace period contained therein, securing said Notes shall constitute
a default under this Agreement.

         2.05 Each of Sea Pines Associates, Inc. and Sea Pines Company, Inc. is
jointly and severally liable for all of the Obligations, including specifically,
without limitation, all Notes owed to the Bank, whether now outstanding or
arising in the future.


               ARTICLE III. THE REVOLVING LINE OF CREDIT FACILITY

         3.01 Subject to the terms and conditions of this Agreement, the Bank
agrees to lend to the Borrower and the Borrower agrees to borrow from the Bank
up to Fifteen Million Dollars ($15,000,000) on a revolving line of credit basis
(the "Revolving Line of Credit Facility"). Except as provided herein, Advances
under the Revolving Line of Credit Facility are to be used only as Project Funds
for the development, construction and completion of Approved Projects. Upon
Project Completion, should the Borrower re-pay or otherwise reduce the amount of
Project Funds advanced, other than by any scheduled principal payments required
hereby or by the Notes, or should the Bank not advance the entirety of Project
Funds so designated, then Advances and re-Advances may be made for the
Borrower's general business purposes in accordance herewith without the Bank's
approval so long as the outstanding amount of Advances or re-Advances does not
exceed the amount of Project Funds so designated and allocated for the Approved
Project(s).

         3.02 The Revolving Line of Credit Note shall bear interest from the
date of the Note at a rate per annum equal to the Adjusted LIBOR Index for the
applicable Interest Period plus the Applicable Margin. Prior to the commencement
of each Interest Period, the Borrower shall have the option for each Interest
Period to select in the manner hereinafter provided, the desired Interest Period
and the corresponding LIBOR Index to be applicable for the outstanding principal

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balance during the upcoming Interest Period by giving to the Bank written or
telephonic notice thereof at least two business days prior to the first day of
such Interest Period; provided (1) any telephonic notice shall be confirmed in a
writing received by the Bank within two business days following the date of such
telephonic notice, (2) all notices given pursuant to this sentence shall be
irrevocable, (3) if the Borrower fails to give such notice to the Bank as herein
required, the Borrower shall be deemed to have selected one (1) month as the
duration of the upcoming Interest Period, and (4) the Interest Period which ends
on the applicable Maturity Date must have a duration of either exactly one (1)
month or, if such exact duration is not possible, a duration of less than 30
days and the Borrower shall be deemed to have selected the Interest Period for a
one (1) month period.

         3.03 So long as there exists no Event of Default (as herein defined),
the Bank will disburse the Project Funds out of the Revolving Line of Credit
Facility for Approved Project construction costs in proportion to progress of
construction (less applicable retainage) and as to costs other than construction
costs as such costs are incurred, provided the obligation of the Bank to
disburse proceeds shall be subject to the Bank's reservation of the right to
retain availability under this Facility funds that the Bank deems sufficient to
complete and pay for the Approved Project(s). Disbursements of Project Funds
shall be limited to one (1) per month unless otherwise expressly permitted by
the Bank, shall be made by wiring or depositing the same to an account of the
Borrower, or at the Bank's election, by the issuance of one or more checks
payable to the Borrower, the Borrower's counsel, the general contractor,
subcontractors, materialmen, or any one or more of them.

         3.04 Any material changes in the scope of an Approved Project, the
Development Cost Analysis (as defined), the construction contract for the
Approved Project, as approved by the Bank (the "Construction Contract") or the
final plans and specifications for the Approved Project as approved by the Bank
(the "Plans and Specifications") shall require the prior written 



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approval of the Bank with the Bank having the right to make corresponding
changes to the amount of designated Project Funds.

         3.05 Prior to any disbursement hereunder and in addition to other
requirements set forth in this Agreement, the Bank shall receive a cost
breakdown for the planned project approved by the Bank on the Bank's form,
certified by the Borrower to be correct to the best of the Borrower's knowledge,
showing the costs of the Approved Project and the sources for the payment of
such costs (the "Development Cost Analysis").

         3.06 Each request for disbursement of the Project Funds for work
performed under the Construction Contract shall be accompanied by (i) a written
request of the Borrower stating the amount of request and (ii) an appropriate
AIA Form G702, G702A or G703, signed by the contractor(s) for the Approved
Project, the architect of record and the Borrower or other similar documentation
satisfactory to the Bank and shall in all cases be limited to items and
certifiable costs set forth in the Development Cost Breakdown.

         3.07 The Borrower will begin construction of the Approved Project in a
timely manner and will make reasonable efforts to continually prosecute the work
in accordance with the applicable Plans or Specifications. The work shall be
performed in conformity with the Plans and Specifications and in compliance with
building and zoning codes and all other applicable legal requirements and
restrictions. The Borrower will keep the Secured Properties free from all liens
for services, labor and materials.

         3.08 The Bank shall have the right, during construction, to inspect the
Approved Project or to cause the construction to be inspected by an independent
inspecting representative. Should there occur any discrepancy in quantity or
quality of workmanship in connection with the construction of the Improvements,
the Bank shall be relieved of the obligation to make an Advance of Project Funds
until such time as the discrepancy shall have been corrected to the satisfaction
of the Bank (and any independent inspecting representative 



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<PAGE>   15

appointed by the Bank pursuant to this Section). The reasonable costs and
expenses incurred in connection with the use of any independent inspecting
representative shall be paid by the Borrower.

         3.09 Prior to any disbursement of Project Funds, the Bank must have
received, in addition to other requirements set forth in this Agreement, the
following as to each Approved Project:

                  (a) Evidence satisfactory to the Bank that the Plans and
Specifications have been approved by the Borrower and all government agencies
having jurisdiction that require approval.

                  (b) Copies of the development, grading, building and any other
governmental permits and approvals required for construction.

                  (c) Written evidence from the appropriate governmental
authority(ies) that the Approved Project and its intended use are in compliance
with all applicable zoning ordinances and land use laws and regulations.

                  (d) A certificate from the record architect (i) that the
Approved Project if constructed and completed in substantial accordance with the
Plans and Specifications will comply with the applicable ANSI Standard under the
Fair Housing Act (as amended) and applicable regulations, if applicable, and/or
with the requirements of Title III of the Americans with Disabilities Act of
1990 (as amended) and the implementing physical accessibility regulations
promulgated thereunder by the Department of Justice and the Americans with
Disabilities Act Accessibility Guidelines (ADAAG) associated therewith, if
applicable; (ii) that all required licenses, permits and other governmental
approvals for the construction of the Improvements have been issued; and (iii)
that the Approved Project, if completed in accordance with the final Plans and
Specifications, will comply with all zoning, fire and building code, etc.
statutes and regulations to which the Project is subject.



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                  (e) A current survey prepared, certified and sealed by a
surveyor satisfactory to the Bank showing, among other things, the location of
any existing or proposed improvements, any setback lines or building lines, the
location of all easements and rights-of-way and all matters affecting title, to
the extent such matters can be shown, and any jurisdictional wetlands area. The
survey shall also be revised periodically during construction, as required by
the Bank, to show footings, foundations, easements, rights-of-way, building
setback lines and progress in construction.


                  (f) A collateral assignment of the Construction Contract and
Plans and Specifications.

                  (g) An appraisal of the Approved Project satisfactory in all
respects to the Bank.

         3.10 Notwithstanding the foregoing relating to the disbursement of
Project Funds for construction purposes, the Bank reserves the right based on
the complexity or scope of each Approved Project to require additional matters
in order to monitor construction of the Approved Project and/or to waive
compliance with, or reduce the extent of, the aforesaid provisions should
circumstances so warrant.

         3.11 Upon the occurrence of an Event of Default, the Bank may, at its
option and in lieu of resorting to any other remedy available to it and without
the appointment of a receiver for the Approved Project or the Borrower, take
possession of the Approved Project and all materials, tools, machinery and other
equipment used for said project or in possession of the Borrower being used in
connection with and in the construction of the project, and, in the name of and
for the account of the Borrower, may complete the improvements either in
accordance with the Plans and Specifications or in accordance with such change
or changes in the Plans and Specifications as may be considered necessary or
desirable by the Bank and may take such other and further action as may be
required to achieve completion of the Approved 



                                       14
<PAGE>   17

Project. For such purposes, the Bank may use any funds of the Borrower at any
time in the hands of the Bank by deposit or otherwise, including the undisbursed
proceeds of the Revolving Line of Credit Facility. Any money advanced by the
Bank for such purposes shall be payable by the Borrower upon demand, shall bear
interest at the rate set forth in the Revolving Line of Credit Note, and its
payment shall be secured by the Mortgages and other Documents. The Bank,
however, shall be under no obligation to complete the Improvements, and the
Bank's action in this respect shall be wholly at its option.

         3.12 The agreements, obligations and covenants established hereby as to
the Revolving Line of Credit Facility shall supersede and replace all
agreements, obligations and covenants set forth in that certain Revolving Credit
Agreement between the Borrower and the Bank dated as of October 15, 1993, as
amended (the "1993 Facility").

         3.13 The Revolving Line of Credit Facility and all Advances thereunder
shall be repaid by the Borrower to the Bank in strict accordance with the terms
and provisions as set forth in this Agreement and the Revolving Line of Credit
Note.

         3.14 In no event shall the Bank be under any obligation to make an
Advance after the occurrence of an Event of Default or the Maturity Date for the
Revolving Line of Credit Facility or the occurrence of an event which with
notice or the passage of time or both would constitute an Event of Default, and
all amounts due and owing shall be paid on said Maturity Date.

         3.15 Interest on the funds drawn by the Borrower under this Revolving
Loan Facility shall be calculated on the basis of actual days elapsed in a
360-day year based on the Interest Rate set forth in the Revolving Line of
Credit Note.



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<PAGE>   18

                ARTICLE IV. THE SEASONAL LINE OF CREDIT FACILITY

         4.01 Subject to the terms and conditions of this Agreement, the Bank
agrees to lend to the Borrower and the Borrower agrees to borrow from the Bank
up to Two Million Five Hundred Thousand Dollars ($2,500,000) on a seasonal line
of credit basis (the "Seasonal Line of Credit Facility").

         4.02 The Seasonal Line of Credit Note shall bear interest from the date
of the Note at a rate per annum equal to the Adjusted LIBOR Index for the
applicable one (1) month Interest Period plus the Applicable Margin.

         4.03 Advances under the Seasonal Line of Credit Facility are to be used
only for the Borrower's general working capital purposes and such cash needs as
relate to the Borrower's operations.

         4.04 The agreements, obligations and covenants established hereby shall
supersede and replace all agreements, obligations and covenants set forth in
that certain Amendment to Credit Agreement between the Borrower and the Bank
dated January 17, 1992, as amended and modified (the "1992 Facility").

         4.05 The Seasonal Line of Credit Facility and all Advances thereunder
shall be repaid by the Borrower to the Bank in strict accordance with the terms
and provisions as set forth in this Agreement, the Seasonal Line of Credit Note
and the FMA Account Agreement.

         4.06 Funds from the Seasonal Line of Credit Facility may be borrowed,
reborrowed, paid and repaid throughout the term at the Borrower's discretion,
subject to and as limited herein.

         4.07 In no event shall the Bank be under any obligation to make an
Advance after the occurrence of an Event of Default or the Maturity Date for the
Seasonal Line of Credit Facility or the occurrence of an event which with notice
or the passage of time or both would constitute an Event of Default, and all
amounts due and owing shall be paid on said Maturity Date.



                                       16
<PAGE>   19

         4.08 Interest on the funds drawn by the Borrower under this Seasonal
Line of Credit Facility shall be calculated on the basis of actual days elapsed
in a 360-day year based on the Interest Rate set forth in the Seasonal Line of
Credit Note.

                       ARTICLE V. THE TERM LOAN FACILITY

         5.01 Subject to the terms and conditions of this Agreement, the Bank
agrees to lend to the Borrower and the Borrower agrees to borrow from the Bank
up to Eighteen Million Five Hundred Thousand Dollars ($18,500,000) on a term
basis (the "Term Loan Facility").

         5.02 The Term Note shall bear interest from the date of the Note at a
rate per annum equal to the Adjusted LIBOR Index for the applicable one (1)
month Interest Period plus the Applicable Margin.

         5.03 The Borrower acknowledges that upon execution of this Agreement
and satisfaction of all requirements of Article VI, the balance of the Term Loan
Facility is $17,158,566.00, as of the date hereof. Additional Advances under the
Term Loan Facility, up to the stated amount will be made for the Borrower's
general working capital purposes and such cash needs as relate to the Borrower's
operations. No re-Advances will be made under the Term Loan Facility. In no
event shall the Bank be under any obligation to make an Advance after May 1,
1999 or after the occurrence of an Event of Default or the occurrence of an
event which with notice or the passage of time or both would constitute an Event
of Default, and all amounts due and owing shall be paid on the Maturity Date.

         5.04 The agreements, obligations and covenants established hereby shall
supersede and replace all agreements, obligations and covenants set forth in
that certain Credit Agreement between the Borrower and the Bank dated November
17, 1987, as amended (the "1987 Facility").

         5.05 The Term Loan Facility and all Advances thereunder shall be repaid
by the Borrower to the Bank in strict accordance with the terms and provisions
as set forth in this 



                                       17
<PAGE>   20

Agreement and the Term Note, provided, that the Bank, in its sole discretion,
may agree to reduce or delay certain principal payments required by the Term
Note should Advances of Project Funds be delayed or reduced below projected
amounts.

         5.06 Interest on the funds drawn by the Borrower under this Term Loan
Facility shall be calculated on the basis of actual days elapsed in a 360-day
year based on the Interest Rate set forth in the Term Note.

                        ARTICLE VI. CONDITIONS PRECEDENT

         6.01 The Bank shall not be required to make any Facility available nor
make any initial or subsequent Advance thereunder unless each of the following
conditions have been fulfilled to the Bank's satisfaction on or before the date
of each Advance:

                  (a) The Borrower shall deliver to the Bank the Documents duly
executed and delivered in accordance with all agreed-upon terms and provisions
including appropriate organizational documents and authorization for the
Borrower to enter into the Documents;

                  (b) The Borrower shall pay all fees and costs due the Bank,
including, without limitation, any Facility Fee, the Bank's attorney's fees and
all other fees and costs payable pursuant to the Commitment Letter or Documents;

                  (c) Upon the Bank's request with respect to any particular
aspect of the Borrower's financial condition, business or prospects, the
Borrower shall provide evidence satisfactory to the Bank as to such request that
there has been no Material Adverse Effect on the financial condition of the
Borrower from that reflected in the annual Financial Statements prepared by
Ernst and Young, LLP and dated October 31, 1997 nor in any subsequent Financial
Statements submitted to the Bank;

                  (d) The Borrower shall remain in substantial compliance with
all covenants contained in the Documents, excepting those covenants set forth in
Section 8.02 herein in which 



                                       18
<PAGE>   21

specific compliance will be required, all representations and warranties made to
the Bank in the Documents remain valid and accurate and no Event of Default
shall have occurred nor any event which with notice or lapse of time or both
would constitute an Event of Default; and

                  (e) The Borrower shall deliver such other papers and documents
as may be reasonably required in the opinion of the Bank's counsel to comply
with the conditions of this Agreement.


                  ARTICLE VII. REPRESENTATIONS AND WARRANTIES

         7.01 To induce the Bank to enter into this Agreement, to make the
Advances provided for herein and to extend credit evidenced by the Obligations,
the Borrower represents and warrants to the Bank that:

                  (a) Each Borrower is a corporation duly organized, validly
existing, and in good standing under the laws of the State of South Carolina;
each Borrower has the corporate power and authority to own its properties and
assets and to carry on its business as now being conducted and is qualified to
do business in every jurisdiction in which, by reason of the character of its
business, it is required to qualify as a foreign corporation and in which
failure to be so qualified would have a material adverse effect on each
Borrower; the Borrower has the corporate power to borrow hereunder and execute
and perform all the Documents, and when executed and delivered, the Documents
shall be valid and binding obligations of each Borrower enforceable in
accordance with their terms;

                  (b) The execution, delivery and performance of the Documents
and the borrowings thereunder by the Borrower have been duly authorized by all
corporation action required for the lawful creation and issuance of the
Documents and shall not violate any provision of law, any order of any court or
other agency of government, the charter documents or bylaws of 



                                       19
<PAGE>   22

each Borrower, any provision of any Material Agreement, or be in conflict with,
result in a breach of or constitute a default under any such Material Agreement;

                  (c) The financial statements which the Borrower has submitted
to the Bank to induce the Bank to extend the credit evidenced by the Notes have
been prepared from the Borrower's books and records in accordance with GAAP and
fairly represent the financial condition of the Borrower at the respective dates
stated therein;

                  (d) Except as set forth in the Financial Statements, there is
no action, suit or proceeding at law or in equity or by or before any
governmental instrumentality or other agency now pending, or to the knowledge of
the Borrower, threatened by or against or affecting either Borrower or any
properties or rights of either Borrower which, if adversely determined, would
have a Material Adverse Effect;

                  (e) The Borrower has filed or caused to be filed all federal,
state and local tax returns which are required to be filed and has paid or
caused to be paid all taxes as shown on said returns or on any assessment
received by them, to the extent that such taxes have become due;

                  (f) The Borrower is not a party to any judgment, order, decree
or any agreement or instrument, nor is subject to any corporate restrictions
having a Material Adverse Effect and is in substantial compliance in the
performance, observance of fulfillment of any of the obligations, covenants or
conditions contained in any Material Agreement;

                  (g) No part of any Advances under the Notes shall be used to
purchase or carry, or to reduce or retire any loan incurred to purchase or
carry, any margin stocks (within the meaning of Regulation U of the Board of
Governors of the Federal Reserve System) or to extend credit to others for the
purpose of purchasing or carrying any such margin stocks. If requested by the
Bank, the Borrower shall furnish the Bank in connection with any loan hereunder
a statement in conformance with the requirements of Federal Reserve Form U-1
referred to in said Regulation. 



                                       20
<PAGE>   23

In addition, no part of any Advances hereunder shall be used for the purchase of
commodity future contracts (or margins therefor for short sales) for any
commodity not required for the normal inventory of the Borrower;

                  (h) None of the Documents contain any material
misrepresentation or untrue statement of fact, or omit to state a material fact
necessary in order to make any representation or statement contained therein not
misleading;

                  (i) This Agreement and the issuance and delivery of the Notes
as contemplated hereby will not involve any prohibited transaction within the
meaning of the Employee Retirement Income Security Act of 1974, as amended
(hereinafter as in effect from time to time called "ERISA") or Section 4975 of
the Internal Revenue Code, as amended. Based upon ERISA and the regulations and
published interpretations thereunder, the Borrower and each Subsidiary is in
compliance in all material respects with the applicable provisions of ERISA. No
Reportable Event, as defined in Section 4043 (b) of Title IV of ERISA, has
occurred with respect to any of the plans maintained by the Borrower or any
Subsidiary;

                  (j) Except for the Borrower's use of Hazardous Materials in
the ordinary course of its business, which uses have been and are in substantial
compliance with all applicable laws and regulations, no properties of the
Borrower have or are now being used by Borrower to generate, manufacture,
refine, transport, treat, store, handle, dispose, transfer, produce, process or
in any manner deal with Hazardous Materials;

                  (k) Except for uses in compliance with subparagraph (j) above,
to the best of the Borrower's knowledge, no Hazardous Materials have ever been
previously installed, placed, or in any manner dealt with on said properties in
violation of applicable laws and regulations other than as has been disclosed in
writing to the Bank pursuant to reports or documents previously provided to the
Bank;



                                       21
<PAGE>   24

                  (l) The Mortgages and Assignments continue to constitute valid
and perfected security interests in the property described therein, ranking
prior to any liens, security interest, mortgages or encumbrances of others,
except any Permitted Encumbrances; and

                  (m) The Borrower has made and will continue to make all
regulatory filings, and has complied with all reporting and disclosure
requirements, as required by applicable state and federal securities laws.


                 ARTICLE VIII. BORROWER'S AFFIRMATIVE COVENANTS

         8.01 Until the expiration of this Agreement as hereinafter provided,
the Borrower shall:

                  (a) Promptly pay to the Bank the Obligations due or to become
due at the times and places and in the amounts and manner specified in the Notes
and or any other Documents, including without limitation, any Facility Fees,
promptly perform with respect to all covenants contained in the Documents, and
take all necessary actions for the representation and warranties made to the
Bank in the Documents to remain valid and accurate;

                  (b) At all times keep proper books and records of accounts for
the Borrower and any Subsidiaries in which full, true and correct entries shall
be made of their transactions in accordance with GAAP and permit representatives
of the Bank to examine such books and records upon reasonable request;

                  (c) Deliver to the Bank with respect to the Borrower and the
Subsidiaries on a consolidated basis (the "Financial Statements"):

                           (i) As soon as practicable and in any event within
forty-five (45) days after the end of each fiscal quarter: (x) income statement
for the quarter period just ended, (y) balance sheet in reasonable detail as of
the end of such quarter; and (z) cash flow statements; all certified to the best
of his knowledge by an authorized financial officer of the Borrower, prepared in
accordance with GAAP and presented in a format acceptable to the Bank;



                                       22
<PAGE>   25

                           (ii) As soon as practicable and in any event within
one hundred twenty (120) days after the end of each Fiscal Year of the Borrower:
(x) an audit report including an income statement for such Fiscal Year, (y) a
balance sheet as of the end of such year, and (z) such other cash flow
statements, reconciliations of net worth, and notes as are customary; all
prepared in accordance with GAAP and bearing an auditor's unqualified opinion
from a certified public accountant or firm of certified public accountants
satisfactory to the Bank (who may be Ernst and Young, LLP or another certified
public accounting firm acceptable to the Bank). Such consolidated reports and
statements shall set forth in reasonable detail the results of operations and
the financial condition of the Borrower and shall be certified to the best of
his knowledge by the President or chief financial officer of the Borrower as
true, accurate and complete;

                           (iii) As soon as practicable and in any event within
ten (10) days after filing, copies of all reports or other documents filed by
the Borrower with the United States Securities Exchange Commission or any state
securities regulators;

                           (iv) The Borrower shall also provide to the Bank on
written request such other information as the Bank may reasonably request
regarding the Collateral, the Borrower and any Subsidiary;

                  (d) Deliver to the Bank with each delivery of the annual and
quarterly Financial Statements, a quarterly compliance certificate substantially
in the form attached as Schedule I, being acceptable to the Bank, and setting
forth in reasonable detail such information as may be necessary for the Bank to
determine the Net Worth and DSC Ratios, as defined in Section 8.02 herein;

                  (e) Preserve and maintain its corporate existence in good
standing;

                  (f) In addition to the requirements of any other Documents,
maintain and preserve in good working order and condition, ordinary wear and
tear excepted, the Secured 



                                       23
<PAGE>   26

Properties with respect to which failure to so maintain and preserve would have
a Material Adverse Effect;

                  (g) Expend sufficient funds during each Fiscal Year as may be
necessary to operate and maintain the Secured Properties and especially the
recreational and resort amenities; including specifically, but not limited to,
all golf courses, tennis courts, transportation systems, conference centers,
racquet club facilities, pro shop facilities, and restaurants, in substantially
the same manner and of substantially the same quality as the Secured Properties
are operated and maintained as of the date of this Agreement (a "First Class
Premier Resort Operation");

                  (h) Make all payments, and otherwise perform all of its
Material Agreements;

                  (i) Preserve and keep in force all licenses, permits,
contracts, management agreements, franchises, trade names, trademarks, rights,
easements, intangibles and leases and other Secured Personalty, as more
particularly described in the Assignments and other Documents;

                  (j) Permit any person designated by the Bank to visit and
inspect any of the properties of the Borrower and to discuss its affairs,
finances and accounts with its officers, all at such reasonable times, and as
often, as the Bank may reasonably request;

                  (k) Execute the necessary Documents required by the Bank to
evidence the indebtedness created under the Notes or the Obligations and to
provide the Bank with such evidence of the accuracy of the Borrower's
representations as the Bank shall reasonably request;

                  (l) Pay to the Bank, upon demand, any amount necessary to
compensate the Bank for any cost, expense, lost benefit, reduction in rate of
return, or reduced receivable attributable to (i) any change in taxation,
reserve requirements, capital adequacy requirement, or any other government
regulation applicable to the Notes or Obligations or payments to the Bank
thereunder, or (ii) any improper prepayments in accordance with this Agreement.
A certificate by the Bank as to any amounts payable under this subparagraph
shall be conclusive proof of the 



                                       24
<PAGE>   27

amount owed. The Borrower's obligations under this subparagraph shall survive
the later of (i) the termination of this Agreement or (ii) the payment of all
amounts payable hereunder;

                  (m) Furnish the Bank within five (5) business days after the
Borrower's executive management obtains knowledge of, or should have known of,
an Event of Default hereunder, including any failure to comply with the
covenants herein, written notice setting forth the details thereof;

                  (n) Maintain appropriate and reasonable insurance as to the
Collateral including hazard, general liability, builders risk (where
appropriate) and business interruption insurance with such insurers and such
amounts and coverage as is acceptable to the Bank, shall name the Bank as
insured, certificate holder, loss payee or mortgagee, as applicable, and shall
provide the Bank with satisfactory evidence thereof;

                  (o) Preserve and maintain, and cause each of its Subsidiaries
to preserve and maintain, all of its and their rights, privileges and franchises
(including, without limitation, licenses) necessary or desirable in the normal
conduct of its business, and conduct its business in an orderly, efficient and
regular manner and continuously except for periodic shut-downs in the ordinary
course of business and interruptions caused by strike, labor dispute, lack of
materials or labor, catastrophe, or other events over which it has no control.
Nothing herein contained shall prevent the termination of the business or
corporate existence of any such Subsidiary which in the judgment of the Borrower
is no longer necessary or desirable, the temporary suspension of the normal
conduct of a portion of the Borrower's business in accordance with the Plans and
Specifications for an Approved Project, or the temporary closing of either the
Harbour Town or Sea Marsh golf course for no more than a six (6) month period
each, in connection with major renovations to said golf courses.

                  (p) Use its best efforts to ensure preservation of a gate
entry policy for Sea Pines Plantation, preservation of ingress and egress over
the roads of Sea Pines Plantation to 



                                       25
<PAGE>   28

the Secured Properties and preservation of all easements for parking and access
to and over open space and common areas in Sea Pines Plantation in a manner
which is reasonably intended to promote the use of recreational and resort
facilities, (including, but not limited to, the golf courses, tennis courts and
beach access facilities) included in the Secured Properties by tourists, guests,
licensees, and invitees of the Borrower, encourage the maintenance of a First
Class Premiere Resort Operation, enhance Borrower's ability to produce optimum
annual net revenue from said Secured Properties and/or the Secured Personalty,
and enhance Borrower's ability to produce optimal annual real estate sales
commission revenue from its real estate sales brokerage Subsidiaries;

                  (q) Until such time as the Obligations are fully paid and
satisfied, Borrower shall keep and maintain with the Bank its primary banking
accounts (investment, disbursement, operating, etc.)of the Borrower and its
Subsidiaries; including, but not limited to, working capital accounts, real
estate brokerage accounts, investment accounts, operating accounts, property
management accounts, securities escrow accounts and corporate accounts;

                  (r) In the event Borrower or any Subsidiary utilizes Advances
under the Revolving Line of Credit Facility to acquire additional assets, either
real or personal, or develops new facilities, the Borrower agrees to cause such
additional security instruments, mortgages and assignments to be executed as the
Bank may from time to time request and the Borrower agrees said assets shall be
deemed additional Secured Properties and shall become subject to the Bank's
mortgage or security interest, all as more particularly set forth in the
Mortgages;

                  (s) At all times until and through November 1, 2003, Borrower
agrees to maintain its existing interest rate hedge position, unless the Bank
approves modifications or substitute position(s) in writing, in an amount of at
least Eighteen Million Dollars ($18,000,000); and



                                       26
<PAGE>   29

                  (t) Upon the Bank's request, the Borrower shall reimburse the
Bank for the cost of appraisals by duly certified appraisers acceptable to Bank
for any or all of the Secured Properties or other Collateral, as may be required
of the Bank by statutes or other regulatory directives.

         8.02 For the term of this Agreement:

                  (a) The Borrower shall not allow the amount of its Total
Liabilities at any time to exceed Two Hundred and Fifty Percent (250%) of the
amount of its Tangible Net Worth, as defined below (the "Net Worth Ratio") and
shall provide, upon request of the Bank, such information, in addition to other
information required hereby, as may be necessary to verify compliance therewith.
"Tangible Net Worth" means the remainder after subtracting Total Liabilities
from the book value of total tangible assets (total assets less good will and
other intangible assets) based upon GAAP. "Total Liabilities" means the book
value of total liabilities based upon GAAP plus the amount of indebtedness for
which the Borrower is liable on a contingent or conditional basis, including
guarantees.

                  (b) The Borrower shall maintain a debt service coverage ratio
("DSC Ratio") of at least 1.25 to be measured as of the end of each fiscal
quarter on a rolling four-quarter basis. The DSC ratio will be calculated as the
quotient of Cash Flow divided by Debt Service with "Cash Flow" equaling the sum
of net income, depreciation and amortization and "Debt Service" equaling the sum
of current maturities of long term debt, current portion of capital leases and
dividends paid, all based upon GAAP; and

                  (c) In the event the Borrower fails to meet either the Net
Worth or DSC Ratios and such failure is not waived by the Bank, the Borrower
shall have thirty (30) days from the date when the Borrower's executive
management knew or should have known of such a failure in which to cure any such
failure. During such cure period, the Bank shall have no obligation to make any
Advance hereunder to the Borrower. Upon the Borrower's cure of any such default,
the 



                                       27
<PAGE>   30

Borrower shall provide the Bank with satisfactory written evidence thereof prior
to the end of the cure period. Failure to cure any such default within the time
period described herein shall constitute an Event of Default under of this
Agreement; provided, however, that there shall be no requirement that the Bank
give written notice of such default and there shall be no additional thirty (30)
day cure period pursuant to this Agreement.

         8.03 The Borrower shall protect, defend, indemnify and save harmless
the Bank and its employees, officers and agents from and against all
liabilities, obligations, claims, damages, penalties, causes of action, costs
and expenses (including attorneys' fees and expenses) imposed upon or incurred
by the Bank or its employees, officers or agents by reason of (a) any claim for
brokerage fees or other such commissions relating to the Collateral, the Notes
or the Obligations, or (b) the condition of the Collateral, including, without
limitation, any Hazardous Materials which are currently on or affecting the
Secured Properties (including Secured Properties owned by any Subsidiary) which
come on, from or affect such Secured Properties or which are hereafter placed
upon or under such Secured Properties, or (c) failure to pay recording,
mortgage, intangibles or similar taxes, roll back taxes, fees or charges
relating to the Obligations or any one or more of the Documents, or (d) the
Documents or any claim or demand whatsoever which may be asserted against the
Bank or its employees, officers or agents by reason of any alleged action,
obligation or undertaking of the Bank or its employees, officers or agents
relating in any way to the Obligations or matter contemplated by the Documents,
or (e) any and all liability arising from any of the Collateral or any
negligence (other than the Bank's gross negligence or wilful misconduct) in the
management, operation, upkeep, repair or control of the Collateral resulting in
loss or injury or death to any tenant, occupant, licensee, employee or stranger.
In the event the Bank or its employees, officers or agents incurs any liability,
loss or damage arising out of or in any way relating to the transactions
contemplated by the Documents (including any of the matters referred to in this
section but not the gross negligence or wilful misconduct of the Bank or its
employees, 



                                       28
<PAGE>   31

officers or agents), the amounts of such liability, loss or damage shall be
added to the Obligations, shall bear interest at the Interest Rate specified in
the appropriate Note from the date incurred until paid and shall be payable on
demand.


                   ARTICLE IX. BORROWER'S NEGATIVE COVENANTS

         9.01 Until payment in full of all of the Obligations, the Borrower
agrees that, unless expressly permitted by this Agreement or the Bank shall have
otherwise consented in writing:

                  (a) Other than Permitted Encumbrances, the Borrower will not
create, incur, assume, or suffer to exist any mortgages, liens or security
interests of any kind representing aggregate claims in excess of $100,000 upon
any of the Collateral, whether now owned or hereafter acquired, except: (i)
liens in connection with workers' compensation or any statutory employment
provision, unemployment insurance, or other social security obligations; (ii)
deposits or pledges to secure the performance of bids, tenders, contracts (other
than contracts for the payment of moneys), statutory obligations, surety and
appeal bonds, and other obligations of like nature arising in the ordinary
course of business; (iii) liens for taxes which are not delinquent or are being
contested in good faith; or (iv) mechanics', workmen's, materialmen's, and other
like liens arising in the ordinary course of business in respect of obligations
which are not overdue or which are being contested in good faith; provided,
however that said liens described by items (i) - (iv) above shall be allowed
only if they do not have a Material Adverse Effect;

                  (b) Neither Borrower nor any Subsidiary will enter into any
merger or consolidation (except with the Borrower or any Subsidiary), or issue
or sell any shares of any Subsidiary;

                  (c) The Borrower shall not sell or lease, or otherwise dispose
of all or any of its assets, including the Collateral, other than pursuant to
the provisions of the Asset Release 



                                       29
<PAGE>   32

Schedule attached hereto as Schedule II, which Schedule is incorporated as if
repeated fully herein, or effect the sale of any material segment of the
Borrower's business in any manner, whether through sale of stock in a subsidiary
or otherwise, or change its corporate name. Nothing herein contained shall
prevent a public or private offering of common stock by Sea Pines Associates,
Inc.

                  (d) The Borrower will not consent to, acknowledge or otherwise
permit any encumbrance on any of the capital stock of any Subsidiary, except
such lien(s) as may be granted to the Bank;

                  (e) Except as required by pronouncements of the Financial
Accounting Standards Board, the Borrower will not change, in any material
fashion, any accounting method used in preparation of its financial statements
or change its Fiscal Year;

                  (f) The Borrower shall not invest cash representing its
working capital in any investments other than marketable securities rated "A" or
higher by Standard & Poor's or Moody's and purchased by the Borrower in the
ordinary course of business;

                  (g) The Borrower shall not enter into or invest in any
corporate joint ventures, partnerships or other similar entities involving less
than 100% ownership by the Borrower which involve an aggregate investment of
more than One Million ($1,000,000) Dollars, except as may be permitted by
written approval of the Bank;

                  (h) The Borrower shall not, and shall not permit any
Subsidiary to, engage in any business activity or operation until the
Obligations are fully paid and satisfied other than the operation, maintenance
and orderly expansion of resort service and community activities (including food
and beverage facilities), operation of lodging facilities and operation of
sports facilities, real estate and business brokerage activities, real estate
securities brokerage activities, and the provision of various community services
to Hilton Head Island property owners;



                                       30
<PAGE>   33

                  (i) Borrower and its Subsidiaries shall not take or consent to
any actions to further restrict rights of access, ingress, egress over the roads
of Sea Pines Plantation or limit parking rights, or modify gate entry policies
as currently provided under applicable easements, covenants and operating
policies in such a way as to materially diminish, impair, or inhibit the use by
tourists, guests, licensees and invitees of Borrower of the recreational or
resort facilities, (including, but not limited to, the golf courses, tennis
courts, and beach access facilities) included in the Secured Properties or
otherwise adversely or materially reduce Borrower's ability to produce optimal
annual net revenue from the said recreational or resort facilities and/or
materially reduce Borrower's ability to produce optimal real estate commission
revenue from the Borrower's real estate sales brokerage Subsidiaries;

                  (j) Borrower shall not take or consent to any actions to
further restrict or diminish access to and/or use of the recreational or resort
facilities included in the Secured Properties by tourists, guests, licensees,
and invitees of Borrower or in any way attempt to create private clubs with such
facilities or impose special use rights, not currently existing, available only
to Sea Pines Plantation Property Owners or other selected classes of membership
which would materially reduce Borrower's ability to produce optimal annual net
revenue from said facilities or otherwise encumber the Secured Property with use
limitations not currently existing;

                  (k) To the extent that such action or omission would have a
Material Adverse Effect, Borrower will not, without the prior written consent of
Bank, (i) initiate or support any zoning reclassification of the Secured
Properties, seek any variance under existing zoning ordinances applicable to the
Secured Properties, or modify or agree to the modification of any recorded
covenants or the Master Plan of Sea Pines Plantation, or use or permit the use
of the Secured Properties in a manner which would result in such use becoming a
non-conforming use under applicable zoning ordinances, covenants and/or the
Master Plan or otherwise 



                                       31
<PAGE>   34

change the existing classification of the Secured Properties or further restrict
the Secured Properties, (ii) modify or amend any of the Permitted Encumbrances,
(iii) impose any restrictive covenants or encumbrances upon the Secured
Properties, (iv) execute or file any subdivision plat affecting the Secured
Properties or consent to the annexation of the Secured Properties to any
municipality, or (v) permit or suffer the Secured Properties to be used by the
public or any person in such manner as might make possible a claim or adverse
usage or possession or of any implied dedication or easement; and

                  (l) The Borrower shall not declare or pay any dividend or
return of capital if it is aware of an Event of Default under this Agreement, or
any event which, with notice or passage of time or both, would become such an
Event of Default or default.

                          ARTICLE X. EVENTS OF DEFAULT

         10.01 Upon the occurrence of any of the following events ("Events of
Default"), the Borrower shall be in default under this Agreement:

                  (a) Failure to pay any of the Obligations when due, including,
without limitation, scheduled payments of principal or interest or upon any
original, accelerated, renewed or extended maturity, within fifteen (15) days
after written notice thereof;

                  (b) If the Borrower shall breach or fail to comply with any
other covenant, term or condition of, or any other of its obligations under this
Agreement, including, without limitation, the obligation for all representations
and warranties to remain continually valid and accurate, and the same is not
cured by the Borrower within thirty (30) days after written notice from the
Bank;

                  (c) Upon the occurrence of a default under any of the
Documents other than this Agreement, including, without limitation, the Notes,
the Mortgages or the Assignments, all of which are cumulative to this Agreement
and to each other, whether specifically set forth above or not, and such default
is not cured within the cure time, if any, provided therein;



                                       32
<PAGE>   35

                  (d) If the Borrower or any Subsidiary (i) files a petition
under the Federal Bankruptcy Code or initiates any other proceeding for the
relief of insolvent debtors; (ii) generally fails to pay its debts as such debts
become due; (iii) shall seek or consent to the appointment of a custodian or
receiver for all or a substantial portion of its assets; (iv) benefits from or
is subject to the entry of an order for relief by any court of insolvency; (v)
makes an admission of insolvency seeking the relief provided in the Federal
Bankruptcy Code or any other insolvency law;

                  (e) If the Borrower or any Subsidiary defaults in the payment
of the principal of, premium, if any, or interest with respect to any
indebtedness for or guaranty of borrowed money to any other person or entity, or
commits or permits to exist any default or event of default under any Material
Agreement for or guaranty of borrowed money to any person or entity not remedied
within any applicable cure period, whether or not such indebtedness shall have
been accelerated;

                  (f) Failure of the Borrower or any Subsidiary within sixty
(60) days after the commencement of any proceeding against it seeking any
reorganization, arrangement, liquidation, dissolution or similar relief under
present or future law, to have such proceeding dismissed or stayed, to the
extent such proceeding affects the operations of the Borrower;


                  (g) If any warranty, representation or statement made or
furnished to the Bank by or on behalf of the Borrower in connection with the
Obligations and/or covenants contained in the Documents, be or proves to have
been materially false or misleading when made or furnished;

                  (h) If an order, judgment or decree shall be entered by any
court appointing a receiver of the property of the Borrower (unless said
appointment shall have been sought by the Bank or its assigns to enforce any of
the Documents or other agreement made or executed in connection herewith), and
such order, judgment or decree be not appealed from within the time allowed by
law, or if appealed, if such order, judgment or decree shall have been affirmed;

                  (i) Subject to the provisions of the Mortgages, if the Secured
Properties described in the Mortgages, or any part or parcel thereof, be
condemned under power of eminent 



                                       33
<PAGE>   36

domain by any legally constituted authority and such condemnation, in the
reasonable opinion of the Bank, has a Material Adverse Effect;

                  (j) In the event a final judgment or judgments is/are filed or
rendered against the Borrower in excess of $100,000.00 in the aggregate, and (i)
such judgments have not been appealed from within the time provided by law, or
if appealed, such judgments shall have been affirmed, and (ii) such judgments
have not been paid or bonded off by the Borrower within ninety (90) days after
they become final and no longer appealable;

                  (k) Any actual or threatened demolition or injury or waste to
the Collateral for the Obligations which has a Material Adverse Effect; or

                  (l) If the Bank deems itself insecure of the prospect of
payment or performance impaired for any reason whatsoever, including but not
limited to, dissolution, termination of existence, insolvency, business failure,
appointment of a receiver of any part of the property of, assignment for the
benefit of creditors by, or the commencement of any proceeding under any
bankruptcy or insolvency laws by or against, the Borrower, or entry of any
judgment against any of them, or failure of the Borrower to provide the Bank
with financial information promptly when requested.

         10.02 No Event of Default shall be waived by the Bank except in writing
and no waiver of any Event of Default shall operate as a waiver of any other
Event of Default or of the same Event of Default on future occasions.

                              ARTICLE XI. REMEDIES

         11.01 Upon the occurrence of any Event of Default, and at any time
thereafter, the Bank shall have the following rights and remedies:

                  (a) The Bank shall be under no obligation to make any further
Advances hereunder and may terminate the Facilities;



                                       34
<PAGE>   37

                  (b) The Bank may, at its option, without presentment, demand,
notice of dishonor, or protest, declare one or more or all of the Obligations
and all amounts advanced hereunder immediately due and payable in full;

                  (c) The Bank shall have the right from time to time to sue for
all or any part of the Obligations, whether interest, principal or any
installment of either or both, taxes, fees, penalties or any other sums required
to be paid under the terms of the Documents, without regard to whether all of
the Obligations shall be then due and without prejudice to the right of the Bank
thereafter to enforce any appropriate remedy against the Borrower, including
actions for a default or defaults by the Borrower existing at the time such
earlier action was commenced; or

                  (d) The Bank may, at its option, pursue any and all rights and
remedies under the Notes, and/or the Mortgages or other Documents as to any or
all of the Collateral, including but not limited to any or all of the Secured
Properties or the Secured Personalty.

         11.02 The rights of the Bank, granted and arising under the Documents
shall be separate, distinct and cumulative of other rights and powers herein
granted and all other rights which the Bank may have at law or in equity, and
none of them shall be in exclusion of the others; and all of them are cumulative
to the remedies for collection of the security provided by law. Any foreclosure
or other sale of less than all of the Collateral or any defective or irregular
sale made in connection herewith shall not exhaust the power of foreclosure or
of sale provided for in the Documents; and subsequent sales may be made until
all of the Obligations have been satisfied or all of the Collateral has been
sold. No act of the Bank shall be construed as an election to proceed under any
one provision of any of the Documents to the exclusion of any other provision or
an election of remedies to the bar of any other remedy allowed at law or in
equity, anything herein or otherwise to the contrary notwithstanding.

         11.03 The Borrower hereby waives, in the event of the foreclosure of as
to any of the Collateral or the enforcement by the Bank of any rights and
remedies hereunder, any right 



                                       35
<PAGE>   38

otherwise available in respect to marshalling of assets which secure the
Obligations or to require the Bank to pursue or delay the pursuit of its
remedies against any such assets. Further, the Borrower agrees that neither the
Borrower nor anyone claiming through or under the Borrower shall or will set up,
claim or seek an advantage of any exemption (including homestead exemptions),
stay, extension or redemption laws now or hereafter in force, in order to
prevent or hinder the enforcement or foreclosure of any Collateral, or the
absolute sale of the Collateral, or the final and absolute putting into
possession thereof, immediately after such sale, of the purchasers thereat and
the Borrower does hereby waive the benefit of all such laws or right of
redemption, exemption or stay.


                     ARTICLE XII. MISCELLANEOUS PROVISIONS

         12.01 In no event shall the Bank be liable to the Borrower for
indirect, special or consequential damages, or the loss of anticipated profits,
which may arise out of or are in any way connected with the Obligations or the
Documents.

         12.02 The covenants and all representations and warranties of the
Borrower shall survive the execution and delivery of the Documents and shall
remain in full force and effect until the expiration of this Agreement as
hereinafter provided. No investigation by the Bank shall affect the
representations or warranties or the right of the Bank to rely upon and enforce
them.

         12.03 Regardless of the amount of the Obligations outstanding at any
time and regardless of whether there is any indebtedness outstanding at all, it
is the intention of the Bank and the Borrower that this Agreement and all of the
Documents shall remain in full force and effect until the last to occur of the
following events: (a) the Obligations have been fully paid; (b) all covenants in
the Documents have been fully and adequately performed; and (c) the Bank has not
agreed to make and is not obligated to make any further Advance to or on behalf
of the Borrower.



                                       36
<PAGE>   39

         12.04 All demands, notices and other communications hereunder except
those relating to selection of interest rate options shall be in writing and
shall be deemed to have been given upon receipt when the writing is delivered in
person, sent by facsimile transmission, provided that a confirmation copy of the
notice is also sent by mail as provided herein or is mailed by first class,
registered or certified mail, postage prepaid, addressed as follows:

To the Bank:               Wachovia Bank, N.A.
                           Post Office Box 700
                           16 Broad Street
                           Charleston, SC  29402
                           Attention:  Donald R. Sanders

To the Borrower:           Sea Pines Associates, Inc.
                           Post Office Box 7000
                           32 Greenwood  Drive
                           Hilton Head Island, SC  29938
                           Attention:  President

                                       AND

                           Sea Pines Company, Inc.
                           Post Office Box 7000
                           32 Greenwood  Drive
                           Hilton Head Island, SC  29938
                           Attention:  President

         12.05 The Borrower shall pay to the Bank upon demand: (a) all expenses
incurred or to be incurred at, before and/or in connection with the execution of
this Agreement and any subsequent Advances, including without limitation;
reasonable attorney's fees incurred for or by the Bank's legal counsel; and (b)
other expenses incurred by the Bank in connection with the maintenance of the
Facilities or other Obligations; including, but not limited to: (i) reasonable
attorney's fees incurred by the Bank in connection with the negotiation,
alteration, amendment or modification in any respect of the Documents or in the
preparation of additional documents or other legal work rendered as a part of
such alterations, amendments or modifications; and (ii) all costs and expenses
of the Bank in connection with the collection of the Obligations and enforcement
of the covenants, including reasonable attorney's fees.



                                       37
<PAGE>   40

         12.06 This Agreement, the Documents and the books and records of the
Bank shall constitute prima facie evidence of all matters with respect to the
Obligations and amounts due hereunder.

         12.07 If any provision or any part thereof of any of the Documents
shall be invalid or unenforceable under applicable law, said part shall be
ineffective to the extent of such invalidity only, without in any way affecting
the remaining parts of said provision or the remaining provisions of said
Document.

         12.08 The Borrower agrees that where, by the terms of the Documents a
day is named or a time fixed for the payment of any of the Obligations or the
performance of any of the covenants, the time stated enters into the
consideration and is of the essence of the whole contract.

         12.09 To the extent permitted by applicable law, if the Bank shall
refuse to make Advances hereunder because the Bank reasonably believes it is not
required to do so, the Bank shall not be liable to the Borrower for any
consequential damages resulting therefrom.

         12.10 The Bank and the Borrower do not intend to be partners or joint
venturers by reason of the transactions contemplated in the Documents.
Notwithstanding any provision in any of the Documents to the contrary, the
Borrower has no authority to act for or on behalf of or to legally bind the Bank
and the Bank possesses only such authority as is provided by law or in the
Documents which authority is intended only to preserve and protect the
Obligations and any security therefor.

         12.11 The Obligations, the covenants and the Documents are made under
and governed by the laws of the State of South Carolina and the Borrower hereby
consents to the jurisdiction of all courts in said State.

         12.12 This Agreement may be executed in several counterparts, each of
which shall be an original and all collectively shall constitute but one
instrument.



                                       38
<PAGE>   41

         12.13 The Documents constitute the entire agreement of the parties on
the subject matter hereof, and may not be modified except in writing signed by
the parties.

         12.14 The Borrower may not assign or otherwise transfer or convey its
interest in the Documents.

         IN WITNESS WHEREOF, the undersigned have duly executed and sealed this
Agreement as of the 31st day of October, 1998.


                                           WACHOVIA BANK, N.A.

 /s/ Steve D. HeyBoer                      By: /s/ Donald R. Sanders
----------------------------                  ------------------------------
 /s/ Tom S Cullen                             Its: Senior Vice President
----------------------------                      --------------------------


                                           SEA PINES ASSOCIATES, INC.

 /s/ Steve D. HeyBoer                      By: /s/ C. W. Flynn
----------------------------                  ------------------------------
 /s/ Tom S. Cullen                            Its: Chairman
----------------------------                      --------------------------


                                              (CORPORATE SEAL)


                                           SEA PINES COMPANY, INC.

 /s/ Steve D. HeyBoer                      By: /s/ Michael E. Lawrence
----------------------------                  ------------------------------
 /s/ Tom S. Cullen                            Its: President
----------------------------                      --------------------------


                                              (CORPORATE SEAL)



                                       39
<PAGE>   42


                                   SCHEDULE I
                             COMPLIANCE CERTIFICATE




I.       DEBT SERVICE COVERAGE RATIO CALCULATION (as of __________, 19___)

<TABLE>
<CAPTION>
                                                                                                        Four Quarters
                                                                    Quarter Ended                           Ended

                                                -------       -------      -------       -------        ------------
<S>                                             <C>           <C>          <C>           <C>            <C>
Net Income (Loss)
Non Cash Expenses - Section IV
                                                -------       -------      -------       -------        ------------
         Total Numerator                        -------       -------      -------       -------        ------------

Current Portion of Long Term Debt                                                                                    *
Current Portion of Capital Leases                                                                                    *
Dividends Paid                                                                                                      **
                                                -------       -------      -------       -------        ------------
         Total Denominator                      -------       -------      -------       -------        ------------

         DEBT SERVICE
         COVERAGE RATIO                                                                                 ============

         Minimum Debt Service
         Coverage Ratio                                                                                      1.25
</TABLE>

         Incentive Debt Service
         Coverage Ratio and
         Applicable margins
                               DSC Ratio             Applicable Margin
                               ---------             -----------------
                               < 1.50                1.50% (150 basis points)
                               => 1.50 but <1.75     1.35% (135 basis points)
                               => 1.75               1.25% (125 basis points)


*        Current quarter balances
**       Dividends accrued or paid during the past four quarters



                                       40
<PAGE>   43

II.      NET WORTH RATIO CALCULATION (as of ____________________, 19__)

         Total Liabilities (including contingent and conditional liabilities)
         Tangible Net Worth

         NET WORTH RATIO                                     ============

         Maximum Net Worth Ratio                                           2.50

III.     OFFICER CERTIFICATION

         To the best of my knowledge, the loan covenant calculations above are
         correct and have been prepared in accordance with the definitions
         included in the Master Credit Agreement. No Event of Default exists
         under the Master Credit Agreement or any other governing loan document.

                                           SEA PINES ASSOCIATES, INC.

                                           By:
----------------------------                  ------------------------------
Date                                          Its: 
                                                  --------------------------



IV.      DEBT SERVICE COVERAGE RATIO CALCULATION (as of ___________, ____)


<TABLE>
<CAPTION>

                                                                                     Four Quarters
                                                         Quarter Ended                   Ended

<S>                                     <C>
Non Cash Expenses                       _______    _______    _______    _______     _____________

Depreciation and amortization
Health Care Operations/Sale
Equity Loss in TidePonte Partners
Tax Provision Adjustment
                                        -------    -------    -------    -------     ------------
Total Non Cash Expenses
                                        =======    =======    =======    =======     ============
</TABLE>




                                       41
<PAGE>   44


                                   SCHEDULE II

                                  ASSET RELEASE
                                    SCHEDULE


         Certain of the Collateral, as hereinafter described, shall be released
from the lien of the Assignments, Mortgages or other Documents upon request of
the Borrower and payment or delivery of the consideration described herein (the
"Release Price") in accordance with the following terms and conditions.

         The Bank shall not be obligated to release any Collateral if (i) an
Event of Default has occurred under the Master Credit Agreement, (ii) an event
has occurred which with the passage of time or the giving of notice the Bank
reasonably anticipates would constitute an Event of Default under the Master
Credit Agreement, or (iii) the Bank reasonably anticipates that the requested
release may result in an Event of Default or cause a Material Adverse Effect
under the Master Credit Agreement.

         The Bank reserves the right to apply all Release Price payments to any
Note or Notes, in its sole discretion, and, notwithstanding any provision in the
Notes, such payments will be applied to the principal balances outstanding under
any such Note(s) (and to pay any applicable prepayment charge) unless the Bank
chooses, in its sole discretion, to apply such payments to accrued interest or
other Obligations. Any payments attributable to Major Groups of Collateral as
described in Section I below may also result in a reduction of funds available
under the Facilities in the Bank's sole discretion.

         The term "Gross Proceeds" as used in this Asset Release Schedule shall
mean the amount equal to the gross sales price payable to the Borrower as stated
in the Contract (as defined) from or in connection with any sale or transfer of
all or any part of any of the Collateral, including, without limitation, the
proceeds of any reserves or escrows (other than those reserves or escrows
established by the Borrower).

         The term "Current Obligations" as used in this Asset Release Schedule
shall mean the then-current principal amount outstanding and any unfunded
commitments under the Obligations (as defined in the Master Credit Agreement) of
the Borrower, including, without limitation, in the Bank's sole discretion,
estimates of the potential exposure, if any, of the Borrower to the Bank for
contingent, conditional and indirect liabilities constituting a portion of said
Obligations.

         The term "Contract" as used in this Asset Release Schedule shall mean
the applicable contract of sale or purchase agreement including any and all
amendments and other related documents pertaining to a sale or other transfer of
any Collateral as submitted to the Bank for its review.

         The property references below are abbreviated commonly used
descriptions, and the legal descriptions for said parcels are contained in the
Mortgages, which descriptions shall be controlling as to actual acreage and
location. Certain legal descriptions are indicated by reference to specific
exhibits of the Mortgages.

         COLLATERAL TYPES TO BE RELEASED:



                                       42
<PAGE>   45

         I. Major Groups of Collateral which must be released in the groups
indicated below and may not be released separately unless otherwise agreed to by
the Bank in its sole discretion:


                  (1) Harbour Town Golf Course (A-2), Clubhouse (A-5),
         Recreation Area (A-5) and Driving Range (A-3), Conference Center (to be
         built):

                      Release Price Greater of:

                          75% of Gross Proceeds or 60% of Current Obligations or
                          Note 1 Calculation


                  (2) Ocean Golf Course (A-16), Sea Marsh Golf Course (A-6), and
         Ocean/Sea Marsh Driving Range (A-28) (to include Collateral connected
         with the pro shop operations for these courses):

                      Release Price Greater of:

                          75% of Gross Proceeds or 60% of Current Obligations or
                          Note 1 Calculation


Note 1. The Release Price shall be the greater of (a) the above percentage of
         Gross Proceeds, or (b) the above percentage of Current Obligations, or
         (c) the dollar amount calculated by applying the following formula:

                 75% x (8 x net annual Cash Flow from Collateral being released)

         "Cash Flow" equals operating revenues minus operating expenses, not
         including depreciation or debt service.


         II. Stock or Assets of Sea Pines Real Estate Company., Inc.:

                      Release Price Greater of:

                             70% of Gross Proceeds or 4% of Current Obligations


         III. Welcome Center/Administrative Building (A-33):

                      Release Price Greater of:

                             80% of Gross Proceeds or 5% of Current Obligations

         IV. Harbour Town Inn (to be built):



                                       43
<PAGE>   46

                      Release Price Greater of:

                             80% of Gross Proceeds or 20% of Current Obligations


         V. Plantation Club (A-32):

                      Release Price Greater of:

                             80% of Gross Proceeds or 4% of Current Obligations

                  The release of the Plantation Club property will be subject to
         the Bank's prior approval of a satisfactory alternative plan for
         providing pro shop facilities for the Ocean Golf Course and/or the Sea
         Marsh Golf Course if either of those courses are to continue as
         Collateral following release of the Plantation Club.


         VI. The Bank and the Borrower acknowledge and agree that the Borrower
may determine it is in its best financial interest to enter into a joint venture
or other development or investment entity for the purpose of developing or
improving certain parcels included within the Secured Properties and in that
regard the Borrower may be required to contribute to said entity the property to
be developed or improved free and clear of the lien of the Mortgages. Subject to
the provisions of ss. 9.01(g) and other provisions of the Master Credit
Agreement and other Documents and the Bank's approval of the nature of the
proposed development or improvements of Secured Properties, the Bank shall
release portions of the Secured Properties to be contributed by the Borrower
from the lien of the Mortgages upon receipt of a collateral assignment and first
security interest in the Borrower's interest in said development or investment
entity in such form as may be acceptable to the Bank in its discretion;
provided, however, the Bank shall not be required to release the Harbour Town
Golf Links Golf Course, the Ocean Course or the Sea Marsh Course or any
ancillary or support facilities related thereto or used in connection therewith
for said purposes.

         VII. All remaining Collateral except for Trademarks, Trade names,
Servicemarks and Logos described in the Assignment of Trademarks, Trade Names,
Intangibles and Proprietary Rights dated November 17, 1987, as amended, the
rights to the various tournaments held on the Secured Properties, if any, and
the various rights described in the Collateral Assignment of Rights and
Easements dated November 17, 1987, as amended, all remaining Collateral may be
sold at the Borrower's option in the ordinary course of business and shall be
released without payment of any Release Price from the liens of the Assignments,
Mortgages or other Documents.

         The Bank reserves the right to review this Schedule annually with the
Borrower and make such amendments as may be mutually agreed upon as may be
necessary to insure that the Bank's collateral position and/or cash flow/debt
service coverage have not been or will not be adversely affected.

         All requests for release of Collateral shall be in writing, and
accompanied by a release instrument in a form and content approved by the Bank .
For all releases for collateral other than as described in section VII above,
the Borrower shall also provide a current recordable survey, identifying the
parcel or parcels to be released, the Borrower's calculations regarding 



                                       44
<PAGE>   47

Cash Flow and prospective covenant compliance, if applicable, and a copy of the
Contract and closing statement signed by an attorney establishing the Gross
Proceeds. For approved releases, the release instruments shall be executed and
tendered to the Borrower or its purchaser upon receipt by the Bank of the
Release Price in certified funds or by fed bank wire. All costs and expenses
incurred by the Bank in connection with providing said release to the Borrower
including the Bank's attorney's fees shall be paid by the Borrower.




                                       45


<PAGE>   48

                                   SCHEDULE I
                             COMPLIANCE CERTIFICATE




I.       DEBT SERVICE COVERAGE RATIO CALCULATION (as of __________, 19___)

<TABLE>
<CAPTION>
                                                                                                        Four Quarters
                                                                    Quarter Ended                           Ended

                                                -------       -------      -------       -------        ------------
<S>                                             <C>           <C>          <C>           <C>            <C>
Net Income (Loss)
Non Cash Expenses - Section IV
                                                -------       -------      -------       -------        ------------
         Total Numerator                        -------       -------      -------       -------        ------------

Current Portion of Long Term Debt                                                                                    *
Current Portion of Capital Leases                                                                                    *
Dividends Paid                                                                                                      **
                                                -------       -------      -------       -------        ------------
         Total Denominator                      -------       -------      -------       -------        ------------

         DEBT SERVICE
         COVERAGE RATIO                                                                                 ============

         Minimum Debt Service
         Coverage Ratio                                                                                      1.25
</TABLE>

         Incentive Debt Service
         Coverage Ratio and
         Applicable margins
                               DSC Ratio             Applicable Margin
                               ---------             -----------------
                               < 1.50                1.50% (150 basis points)
                               => 1.50 but <1.75     1.35% (135 basis points)
                               => 1.75               1.25% (125 basis points)


*        Current quarter balances
**       Dividends accrued or paid during the past four quarters



                                       S-1
<PAGE>   49

II.      NET WORTH RATIO CALCULATION (as of ____________________, 19__)

         Total Liabilities (including contingent and conditional liabilities)
         Tangible Net Worth

         NET WORTH RATIO                                     ============

         Maximum Net Worth Ratio                                           2.50

III.     OFFICER CERTIFICATION

         To the best of my knowledge, the loan covenant calculations above are
         correct and have been prepared in accordance with the definitions
         included in the Master Credit Agreement. No Event of Default exists
         under the Master Credit Agreement or any other governing loan document.

                                           SEA PINES ASSOCIATES, INC.

                                           By:
----------------------------                  ------------------------------
Date                                          Its: 
                                                  --------------------------



IV.      DEBT SERVICE COVERAGE RATIO CALCULATION (as of ___________, ____)


<TABLE>
<CAPTION>

                                                                                     Four Quarters
                                                         Quarter Ended                   Ended

<S>                                     <C>
Non Cash Expenses                       _______    _______    _______    _______     _____________

Depreciation and amortization
Health Care Operations/Sale
Equity Loss in TidePonte Partners
Tax Provision Adjustment
                                        -------    -------    -------    -------     ------------
Total Non Cash Expenses
                                        =======    =======    =======    =======     ============
</TABLE>




                                       S-2
<PAGE>   50


                                   SCHEDULE II

                                  ASSET RELEASE
                                    SCHEDULE


         Certain of the Collateral, as hereinafter described, shall be released
from the lien of the Assignments, Mortgages or other Documents upon request of
the Borrower and payment or delivery of the consideration described herein (the
"Release Price") in accordance with the following terms and conditions.

         The Bank shall not be obligated to release any Collateral if (i) an
Event of Default has occurred under the Master Credit Agreement, (ii) an event
has occurred which with the passage of time or the giving of notice the Bank
reasonably anticipates would constitute an Event of Default under the Master
Credit Agreement, or (iii) the Bank reasonably anticipates that the requested
release may result in an Event of Default or cause a Material Adverse Effect
under the Master Credit Agreement.

         The Bank reserves the right to apply all Release Price payments to any
Note or Notes, in its sole discretion, and, notwithstanding any provision in the
Notes, such payments will be applied to the principal balances outstanding under
any such Note(s) (and to pay any applicable prepayment charge) unless the Bank
chooses, in its sole discretion, to apply such payments to accrued interest or
other Obligations. Any payments attributable to Major Groups of Collateral as
described in Section I below may also result in a reduction of funds available
under the Facilities in the Bank's sole discretion.

         The term "Gross Proceeds" as used in this Asset Release Schedule shall
mean the amount equal to the gross sales price payable to the Borrower as stated
in the Contract (as defined) from or in connection with any sale or transfer of
all or any part of any of the Collateral, including, without limitation, the
proceeds of any reserves or escrows (other than those reserves or escrows
established by the Borrower).

         The term "Current Obligations" as used in this Asset Release Schedule
shall mean the then-current principal amount outstanding and any unfunded
commitments under the Obligations (as defined in the Master Credit Agreement) of
the Borrower, including, without limitation, in the Bank's sole discretion,
estimates of the potential exposure, if any, of the Borrower to the Bank for
contingent, conditional and indirect liabilities constituting a portion of said
Obligations.

         The term "Contract" as used in this Asset Release Schedule shall mean
the applicable contract of sale or purchase agreement including any and all
amendments and other related documents pertaining to a sale or other transfer of
any Collateral as submitted to the Bank for its review.

         The property references below are abbreviated commonly used
descriptions, and the legal descriptions for said parcels are contained in the
Mortgages, which descriptions shall be controlling as to actual acreage and
location. Certain legal descriptions are indicated by reference to specific
exhibits of the Mortgages.

         COLLATERAL TYPES TO BE RELEASED:



                                       S-3
<PAGE>   51

         I. Major Groups of Collateral which must be released in the groups
indicated below and may not be released separately unless otherwise agreed to by
the Bank in its sole discretion:


                  (1) Harbour Town Golf Course (A-2), Clubhouse (A-5),
         Recreation Area (A-5) and Driving Range (A-3), Conference Center (to be
         built):

                      Release Price Greater of:

                          75% of Gross Proceeds or 60% of Current Obligations or
                          Note 1 Calculation


                  (2) Ocean Golf Course (A-16), Sea Marsh Golf Course (A-6), and
         Ocean/Sea Marsh Driving Range (A-28) (to include Collateral connected
         with the pro shop operations for these courses):

                      Release Price Greater of:

                          75% of Gross Proceeds or 60% of Current Obligations or
                          Note 1 Calculation


Note 1. The Release Price shall be the greater of (a) the above percentage of
         Gross Proceeds, or (b) the above percentage of Current Obligations, or
         (c) the dollar amount calculated by applying the following formula:

                 75% x (8 x net annual Cash Flow from Collateral being released)

         "Cash Flow" equals operating revenues minus operating expenses, not
         including depreciation or debt service.


         II. Stock or Assets of Sea Pines Real Estate Company., Inc.:

                      Release Price Greater of:

                             70% of Gross Proceeds or 4% of Current Obligations


         III. Welcome Center/Administrative Building (A-33):

                      Release Price Greater of:

                             80% of Gross Proceeds or 5% of Current Obligations

         IV. Harbour Town Inn (to be built):



                                       S-4
<PAGE>   52

                      Release Price Greater of:

                             80% of Gross Proceeds or 20% of Current Obligations


         V. Plantation Club (A-32):

                      Release Price Greater of:

                             80% of Gross Proceeds or 4% of Current Obligations

                  The release of the Plantation Club property will be subject to
         the Bank's prior approval of a satisfactory alternative plan for
         providing pro shop facilities for the Ocean Golf Course and/or the Sea
         Marsh Golf Course if either of those courses are to continue as
         Collateral following release of the Plantation Club.


         VI. The Bank and the Borrower acknowledge and agree that the Borrower
may determine it is in its best financial interest to enter into a joint venture
or other development or investment entity for the purpose of developing or
improving certain parcels included within the Secured Properties and in that
regard the Borrower may be required to contribute to said entity the property to
be developed or improved free and clear of the lien of the Mortgages. Subject to
the provisions of ss. 9.01(g) and other provisions of the Master Credit
Agreement and other Documents and the Bank's approval of the nature of the
proposed development or improvements of Secured Properties, the Bank shall
release portions of the Secured Properties to be contributed by the Borrower
from the lien of the Mortgages upon receipt of a collateral assignment and first
security interest in the Borrower's interest in said development or investment
entity in such form as may be acceptable to the Bank in its discretion;
provided, however, the Bank shall not be required to release the Harbour Town
Golf Links Golf Course, the Ocean Course or the Sea Marsh Course or any
ancillary or support facilities related thereto or used in connection therewith
for said purposes.

         VII. All remaining Collateral except for Trademarks, Trade names,
Servicemarks and Logos described in the Assignment of Trademarks, Trade Names,
Intangibles and Proprietary Rights dated November 17, 1987, as amended, the
rights to the various tournaments held on the Secured Properties, if any, and
the various rights described in the Collateral Assignment of Rights and
Easements dated November 17, 1987, as amended, all remaining Collateral may be
sold at the Borrower's option in the ordinary course of business and shall be
released without payment of any Release Price from the liens of the Assignments,
Mortgages or other Documents.

         The Bank reserves the right to review this Schedule annually with the
Borrower and make such amendments as may be mutually agreed upon as may be
necessary to insure that the Bank's collateral position and/or cash flow/debt
service coverage have not been or will not be adversely affected.

         All requests for release of Collateral shall be in writing, and
accompanied by a release instrument in a form and content approved by the Bank .
For all releases for collateral other than as described in section VII above,
the Borrower shall also provide a current recordable survey, identifying the
parcel or parcels to be released, the Borrower's calculations regarding 



                                       S-5
<PAGE>   53

Cash Flow and prospective covenant compliance, if applicable, and a copy of the
Contract and closing statement signed by an attorney establishing the Gross
Proceeds. For approved releases, the release instruments shall be executed and
tendered to the Borrower or its purchaser upon receipt by the Bank of the
Release Price in certified funds or by fed bank wire. All costs and expenses
incurred by the Bank in connection with providing said release to the Borrower
including the Bank's attorney's fees shall be paid by the Borrower.




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