<PAGE>   1
                                                                   EXHIBIT 10.68










                                  $22,920,000


                               CREDIT AGREEMENT,


                          dated as of January 1, 1998




                                    between



               CRESCENT REAL ESTATE EQUITIES LIMITED PARTNERSHIP
                         A Delaware limited partnership
                                 as the Lender,


                                      and



                     CRESCENT DEVELOPMENT MANAGEMENT CORP.,
                             a Delaware corporation
                                as the Borrower






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                                CREDIT AGREEMENT

         THIS CREDIT AGREEMENT (the "Agreement"), dated as of January 1, 1998,
between CRESCENT REAL ESTATE EQUITIES LIMITED PARTNERSHIP, a Delaware limited
partnership (the "Lender") and CRESCENT DEVELOPMENT MANAGEMENT CORP., a
Delaware corporation (the "Borrower").

                                   ARTICLE I

         WHEREAS, Lender previously has extended Borrower a loan in the amount
of $3,100,000 for the purpose of enabling Borrower to acquire a 50% member's
interest in East West Resorts, LLC, a Delaware limited liability company (the
"Company") operating under that First Amended and Restated Operating Agreement
dated as of February 15, 1996, and payment of such loan is secured by all of
Borrower's interest in the Company; and

         WHEREAS, the Members (so called) of the Company, including Borrower,
desire to enter into a Second Amended and Restated Operating Agreement (as
amended or restated from time to time, the "Second Restated Operating
Agreement") pursuant to which Borrower would commit itself to make an
additional contribution of $4.96 million cash within the near term and to
commit to make up to $25.6 million in additional contributions to the Company
in the future; and

         WHEREAS, the Borrower has applied for and Lender is willing, on the
terms and subject to the conditions hereinafter set forth, to extend to the
Borrower a line of credit loan (the "Loan"), in a maximum aggregate principal
amount at any one time outstanding not to exceed $22,920,000 from time to time
prior to the Commitment Termination Date, the proceeds of which will be used
from time to time exclusively for working capital purposes of the Borrower in
order to provide funds for making capital contributions to Company, as provided
for in this Agreement;

         NOW, THEREFORE, the parties hereto agree as follows:


                                   ARTICLE II
                   COMMITMENTS, ADVANCE PROCEDURES AND NOTES

         SECTION 2.1 Commitment. On the terms and subject to the conditions of
this Agreement (including Article V), Lender agrees to make advances under the
Loan to the Borrower up to an aggregate amount of Twenty -Two Million Nine
Hundred Twenty Thousand and No/100 Dollars ($22,920,000) (the "Commitment
Amount") pursuant to Section 2.2. Lender shall not be required to make any
advance under this Loan if, after giving effect thereto, the aggregate
principal amount of all Advances would exceed the Commitment Amount. Borrower
acknowledges that this Agreement does not create a revolving credit facility
but rather a term loan facility which Borrower may draw against from time to
time, but each Advance made to Borrower reduces, dollar for dollar, the unused
Commitment Amount; principal payments made by Borrower against the Loan may not
be reborrowed.

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         SECTION 2.2 Advance Procedure. Borrower may from time to time request
that an Advance be made. Each Advance following the Initial Advance shall be in
an amount which is equal to the lesser of (a) the unused amount of the
Commitment Amount, or (b) [One Million Dollars or a multiple thereof]. The
request shall be made by delivering a Application for Advance to the Lender not
less than three (3) Business Days prior to the date upon which such Advance is
to be made and, if all such conditions precedent to such Advance have been
satisfied, Lender shall make such Advance directly to the Borrower by wire
transfer to the accounts the Borrower shall have specified in its Application
for Advance.

         SECTION 2.3 Note. The Loan shall be evidenced by a single promissory
note (the "Note") payable to the order of Lender in the maximum principal
amount of Twenty-Two Million Nine Hundred Twenty Thousand and No/100 Dollars
($22,920,000).

         SECTION 2.4 Existing Term Note and Credit Note. Lender is the holder
of that $3.1 million principal amount Promissory Note dated February 29, 1996,
made by Borrower payable to Lender (the "Term Note"), payment of which is
secured by Borrower's interest in the Company under that Security Agreement
dated February 29, 1996 (the "1996 Security Agreement"); and also the holder of
that $28,166,666 principal amount Line of Credit Note dated April 15, 1997,
made by Borrower payable to Lender (the "Credit Note"), payment of which is
secured by Borrower's interest in East West Resort Development, L. P. and EWRD
Summit Holdings, L. P. (East West Partnerships"). To induce Lender to enter
into this Agreement and advance the Commitment Amount to Borrower, Borrower
agrees to grant Lender a security interest in Borrower's East West Partnerships
to secure payment of the Note and to amend and restate the 1996 Security
Agreement to provide that the Borrower's interest in the Company shall secure
payment of the Note as well as the Term Note.

                                  ARTICLE III
                             PAYMENTS AND INTEREST

         SECTION 3.1 Payments. Payments of the Loan shall be made as set forth
in this Section 3.1 and shall be without premium or penalty.

                  SECTION 3.1.1 Final Maturity. On the Stated Maturity Date,
the Borrower shall repay in full all accrued but unpaid interest and the entire
unpaid principal amount of the Loan.

                  SECTION 3.1.2 Mandatory Payments. The Borrower shall, within
one (1) Business Day following (a) receipt by Borrower of any Distribution
other than a Tax Distribution, make a mandatory payment of the Loan in an
amount equal to such Distribution less an amount approved by Lender in its
reasonable discretion for unpaid expenses and payables incurred by Borrower in
the ordinary course of business and a reasonable reserve for future expenses
and (b) receipt by Borrower of any payments on an Emergency Loan, make a
mandatory payment of the Loan in an amount equal to the payments received (less
amounts retained for expenses and payables). All mandatory payments made under
this Section shall be applied first to 



<PAGE>   4

accrued but unpaid interest and thereafter to the outstanding principal balance
of the Loan. Each mandatory payment made hereunder which is attributable to a
Distribution shall be accompanied by a certificate from the Borrower to the
Lender which designates whether the mandatory payment is a Special Mandatory
Payment. If Borrower fails to provide such a certificate, Lender shall
designate whether the mandatory payment is a Special Mandatory Payment and such
determination shall be conclusive. Borrower acknowledges to Lender that the
Company is generally obligated to distribute all net cash flow (other than tax
distributions ) and amounts established as reserves) to its members (including
the Borrower). Notwithstanding anything in this Agreement to the contrary,
Lender shall not be obligated to make any additional Advance to Borrower
pursuant to this Agreement if, based on a determination by Lender in its
reasonable discretion, the Company has failed to satisfy its obligation to make
the distributions described in the preceding sentence and such failure is
continuing.

                  SECTION 3.1.3 Acceleration of Stated Maturity Date.
Immediately upon any acceleration of the Stated Maturity Date of the Loan
pursuant to Section 8.2 or Section 8.3, the Borrower shall repay the Loan to
the full extent of such acceleration.

         SECTION 3.2 Interest Provisions. Interest on the outstanding principal
amount of the Loan shall accrue and be payable in accordance with this Section
3.2.

                  SECTION 3.2.1 Rate. Prior to an Event of Default, the
outstanding principal balance of the Loan shall accrue interest at the rate
(the "Interest Rate") of 12%, compounded annually; provided, however, that in
no event will the Interest Rate exceed a rate that would cause the yield to
maturity on the Loan to equal or exceed that rate described in Section
163(i)(1)(B) of the Code.

                  SECTION 3.2.2 Post-Maturity Rates. Upon and after an Event of
Default, the Loan shall accrue interest on the outstanding principal balance of
the Loan and, to the extent permitted by applicable law, on the unpaid
interest, at a rate per annum equal to the Interest Rate plus an additional
5.0% per annum (the "Default Rate"); provided in no event shall the Default
Rate exceed the maximum rate of interest permitted by applicable law.

                  SECTION 3.2.3 Accrual. At the end of each calendar year
during the term hereof, all interest which has accrued but has not been paid
during such calendar year shall be added to the outstanding principal balance
of the Loan and shall, thereafter, bear interest, prior to an Event of Default,
at the Interest Rate.

                  SECTION 3.2.4 Minimum Annual Interest Payment.
Notwithstanding anything else contained in this Article III, Borrower on each
anniversary date of this Note shall pay Lender an amount equal to the excess,
if any, of (a) one-half of the interest accrued on the outstanding principal
balance of the Loan since the last anniversary date, over (b) the amount of
Special Mandatory Payments made to Lender since the last anniversary date that
were applied to pay interest on the Loan.

<PAGE>   5

                                   ARTICLE IV
                            CERTAIN OTHER PROVISIONS

         SECTION 4.1 Payments, Computations, etc. Unless otherwise expressly
provided, all payments by the Borrower pursuant to this Agreement, the Note or
any other Loan Document shall be made, without setoff, deduction or
counterclaim, not later than 12:00 noon, Fort Worth, Texas time, on the date
due, in same day or immediately available funds, to such account as the Lender
shall specify from time to time by written notice delivered to the Borrower.
Whenever any payment to be made shall otherwise be due on a day which is not a
Business Day, such payment shall be made on the next succeeding Business Day
and such extension of time shall be included in computing interest and fees, if
any, in connection with such payment.

         SECTION 4.2 Setoff. Lender shall, upon the occurrence of any Default
have the right to appropriate and apply to the payment of the Note (whether or
not then due) all amounts then held by such Lender of the Borrower. The rights
of Lender under this Section are in addition to other rights and remedies
(including other rights of setoff under applicable law or otherwise) which
Lender may have. The Borrower hereby waives all rights of setoff, appropriation
and application it may have pursuant to applicable law or otherwise.

         SECTION 4.3 Use of Proceeds. The proceeds of the Loan shall be used by
Borrower solely to make capital contributions to the Company in accordance with
the Second Restated Operating Agreement.


                                   ARTICLE V
                            CONDITIONS TO BORROWING

         SECTION 5.1 Initial Advance. The obligations of the Lender to fund the
Initial Advance shall be subject to the prior or concurrent satisfaction of
each of the conditions precedent set forth in this Section 5.1.

                  SECTION 5.1.1 Application for Advance. The Lender shall have
received an Application for Advance.

                  SECTION 5.1.2 Resolutions, etc. The Lender shall have
received from Borrower a certificate of resolutions and incumbency as to
resolutions of its Board of Directors then in full force and effect authorizing
the execution, delivery and performance of this Agreement, the Note and each
other Loan Document to be executed by it.

                  SECTION 5.1.3 Delivery of Note. The Lender shall have
received the Note duly executed and delivered by the Borrower.

                  SECTION 5.1.4 Borrower Security Agreement. The Lender shall
have received executed counterparts of the Borrower's Amended and Restated
Security Agreement together with such UCC-1 financing statements and UCC search
reports as Lender may require.

<PAGE>   6

                  SECTION 5.1.5 Financial Information, etc. The Lender shall
have received, in form and scope reasonably satisfactory to Lender, the
financial statements referred to in Section 6.5.

                  SECTION 5.1.6 Closing Fees, Expenses, etc. The Lender shall
have received all fees, costs and expenses due and payable pursuant to this
Agreement.

                  SECTION 5.1.7 Organic Documents. The Lender shall have
received a copy of the Second Restated Operating Agreement.

                  SECTION 5.1.8 Equity Contribution. The stockholders of
Borrower shall have made additional equity contributions to Borrower in an
aggregate amount of at least $2,606,000 and Borrower in turn shall have
contributed those funds to the Company.

                  SECTION 5.1.9 Contribution Requirements. The Lender shall
have received from Borrower and the Company written certification that the
Contribution Requirements (set forth in Exhibit F to the Second Restated
Operating Agreement) are satisfied.

         SECTION 5.2 All Advances. The obligation of Lender to fund future
Advances shall be subject to the satisfaction of each of the conditions
precedent set forth in this Section 5.2.

                  SECTION 5.2.1 Application for Advance. The delivery of an
Application for Advance.

                  SECTION 5.2.2 Compliance with Warranties, No Default, etc.
Both before and after giving effect to any Advances the following statements
shall be true and correct to the satisfaction of the Lender:

                          (a) the representations and warranties set forth in
                  this Agreement shall be true and correct with the same effect
                  as if then made;

                          (b) no Default shall have then occurred and be
                  continuing.

                  SECTION 5.2.3 Organic Documents. The Lender shall have
received a copy of the Organic Documents for the Company, to the extent they
have been amended or modified.

         SECTION 5.2.4 Fees and Expenses. The Lender shall have received all
fees, costs and expenses due and payable pursuant to this Agreement.

                  SECTION 5.2.5 Compliance with Section 7.1.7. The Company
shall have received the full amount of stockholder contributions required to be
made under Section 7.1.7 in connection with such Advance or other Assessment
Determination under the Commitment Funding Instruments.


<PAGE>   7

                  SECTION 5.2.6 Request from Company. Lender shall have
received a copy of the Request and Certification from Manager to Borrower
relating to requests for New Capital as described in the Contribution
Requirements set forth in Exhibit F to the Second Restated Operating Agreement.
Lender shall have received from Borrower its written certificate executed by a
duly authorized executive officer that all Contribution Requirements have, to
Borrower's best knowledge and belief after inquiry, been satisfied and not
waived.

                  SECTION 5.2.7 Satisfactory Legal Form. All documents executed
or submitted pursuant hereto shall be reasonably satisfactory in form and
substance to the Lender and its counsel; the Lender shall have received all
other information, approvals, opinions, documents or instruments as the Lender
or its counsel may reasonably request.


                                   ARTICLE VI
                         REPRESENTATIONS AND WARRANTIES

         To induce the Lender to enter into this Agreement and to make the Loan
hereunder and to make each Advance pursuant to the Loan, the Borrower
represents and warrants unto the Lender as of the day and year first written
above and on the date of each Advance as set forth in this Article VI.

         SECTION 6.1 Organization, etc. The Borrower is a duly formed
corporation under the laws of Delaware, is duly qualified to do business and
has full power and authority and holds all requisite governmental licenses,
permits and other approvals to enter into and perform its obligations under
this Agreement, the Note and each other Loan Document to which it is a party,
and to own and hold its property and to conduct its business substantially as
currently conducted by it.

         SECTION 6.2 Due Authorization, Non-Contravention, etc. The execution,
delivery and performance by the Borrower of this Agreement, the Note and each
other Loan Document executed or to be executed by it, are within the Borrower's
corporate powers, have been duly authorized by all necessary action (including
but not limited to any consent of stockholders required by law or its Organic
Documents) and do not (a) contravene the Borrower's Organic Documents; or (b)
contravene any contractual restriction, law or governmental regulation or court
decree or order binding on or affecting the Borrower except for such
contraventions which will not, singly or in the aggregate, have a material
adverse effect on the ability of the Borrower to perform its obligations under
this Agreement or any Loan Document.

         SECTION 6.3 Government Approval, Regulation, etc. No authorization,
consent or approval or other action by, and no notice to, filing with or
license from, any governmental authority or regulatory body or other Person is
required for the due execution or delivery by the Borrower of this Agreement,
the Note or any other Loan Document to which it is a party, or for the
consummation and performance of the transactions contemplated hereby or
thereby.

         SECTION 6.4 Validity, etc. Each of this Agreement and, upon the due
execution and 


<PAGE>   8

delivery thereof, the Note and each other Loan Document executed by the
Borrower or the Company, constitutes the legal, valid and binding obligation of
such parties enforceable in accordance with its respective terms, except as
such enforceability may be limited by applicable bankruptcy, reorganization,
insolvency and other similar laws affecting creditors rights generally.

         SECTION 6.5 Financial Information. All financial information which has
been or shall hereafter be furnished by or on behalf of the Borrower or by any
other Person at the Borrower's direction to the Lender for the purposes of or
in connection with this Agreement present fairly the financial condition as at
the dates thereof (subject to normal year end adjustments in the case of
unaudited financial statements).

         SECTION 6.6 No Material Adverse Change. There has been no material
adverse change in the business, financial condition, operations, assets,
revenues, or properties, of the Borrower taken as a whole from the financial
information previously provided to Lender.

         SECTION 6.7 No Default Under Indebtedness. No event of default has
occurred and is continuing, and no event has occurred which with the giving of
notice, passage of time or both would become a material event of default under
any of the Indebtedness permitted to be incurred pursuant to Section 7.2.2
hereof.

         SECTION 6.8 Litigation, Labor Controversies, etc. There is no pending
or, to the knowledge of the Borrower, threatened litigation, action, proceeding
or labor controversy affecting the Borrower or the Company which, if adversely
determined could reasonably be expected to have a material adverse effect on
Borrower, the Company, or Lender.

         SECTION 6.9 Taxes. The Borrower has filed all material tax returns and
reports required by law to have been filed and has paid all taxes and
governmental charges thereby shown to be due and payable.

         SECTION 6.10 Additional Stockholder Equity. The Stockholders have
contributed (or have delivered to Borrower their enforceable commitments to
contribute), in the aggregate, $2,606,000 cash to the capital of Borrower to be
used to fund (in conjunction with the Initial Advance) Borrower's initial
capital contributions under the Second Restated Operating Agreement. Borrower
has received from each of the Stockholders his or its Funding Commitment
Instrument, pursuant to which each the Stockholders have severally obligated
themselves to make additional capital contributions to Borrower of up to an
aggregate amount of $5,034,00 to satisfy the requirements of Section ___ and
for other purposes set forth in the Funding Commitment Instruments.

         SECTION 6.11 ERISA. Neither Borrower, nor, to the best knowledge of
Borrower, any other person has taken any action or failed to take any action
which would subject Borrower, or the Company to any potential liability under
ERISA.

         SECTION 6.12 Accuracy of Information. All factual information, as
amended, 


<PAGE>   9

supplemented or modified, furnished by or on behalf of the Borrower in writing
to (or as directed by) the Lender for purposes of or in connection with this
Agreement, any other Loan Document or any transaction contemplated hereby is
true and accurate in all material respects as of the date of execution and
delivery of this Agreement and all other such factual information thereafter
furnished by or on behalf of the Borrower to (or as directed by) the Lender
pursuant to the terms of this Agreement or any other Loan Document is true and
accurate in every material respect on the date as of which such information as
dated or certified, and does not omit any material fact necessary to make such
Information not misleading.

                                  ARTICLE VII
                                   COVENANTS

         SECTION 7.1 Affirmative Covenants. Borrower will perform the
obligations set forth in this Section 7.1.

                  SECTION 7.1.1 Financial Information, Reports, Notices, etc.
Borrower will furnish, or will cause to be furnished, to Lender copies of the
following financial statements, reports, notices and information:

                          (a) As soon as available and in any event within 45
                  days after the end of each Fiscal Quarter of each Fiscal Year
                  of Borrower (including the final Fiscal Quarter of each
                  Fiscal Year), Borrower will deliver, or cause to be
                  delivered, balance sheets of Borrower as of the end of such
                  Fiscal Quarter and statements of income, cash flow and
                  Borrower's equity for such Fiscal Quarter and for the period
                  commencing at the end of the previous Fiscal Year and ending
                  with the end of such Fiscal Quarter, setting forth in each
                  case in comparative form the figures for the corresponding
                  Fiscal Quarter of the previous Fiscal Year, certified by the
                  chief financial Officer of Borrower in a manner acceptable to
                  the Lender.

                          (b) if requested by Lender for any Fiscal Year,
                  Borrower will have prepared at Borrower's expense and
                  Borrower will deliver, or cause to be delivered, to Lender a
                  copy of an annual audit report for Borrower including therein
                  balance sheets of Borrower as of the end of such Fiscal Year
                  and statements of cash flow, income and Borrower's equity for
                  such Fiscal Year, in each case certified (without
                  qualification) by independent public accountants reasonably
                  acceptable to the Lender.

                          (c) a copy of all financial accounting and reports
                  which are to be provided to the members of the Company
                  pursuant to Article 10 of the Operating Agreement.

                          (d) As soon as possible and in any event within three
                  Business Days after becoming aware of

<PAGE>   10

                                (i) the occurrence of any material adverse
                          development with respect to the Company or any
                          Subsidiary, or

                                (ii) copies of any material notices or
                          communications from a lender or with respect to
                          Borrower or the Company; or

                                (iii) copies of any material notices or
                          communications from the Company to another lender or
                          Governmental Authority with respect to a Project or
                          the Project Loan Documents.

                  Borrower will deliver, or will cause to be delivered,
                  notice thereof and copies of all documentation relating
                  thereto.

                          (e) Borrower will deliver, or will cause to be
                  delivered, such other information respecting the condition or
                  operations, financial or otherwise, of the Borrower or the
                  Company as the Lender may from time to time reasonably
                  request.

                  SECTION 7.1.2 Compliance with Laws, etc. Borrower will, and,
consistent with Borrower's rights and obligations under the Operating
Agreement, will cause the Company to, comply in all material respects with all
applicable Governmental Requirements, such compliance to include, but not be
limited to:

                          (a) the maintenance and preservation of its existence
                  and qualification in all foreign jurisdictions where it is
                  required to do so except where the failure to do so would not
                  be material; and

                          (b) the payment, before the same become delinquent,
                  of all taxes, assessments and governmental charges imposed
                  upon it or upon its property except to the extent they are
                  being diligently contested in good faith by appropriate
                  proceedings and for which adequate reserves in accordance
                  with GAAP shall have been set aside on its books.

                  SECTION 7.1.3 Maintenance of Properties. Borrower will, and,
consistent with Borrower's rights and obligations under the Operating
Agreement, will cause the Company to, maintain, preserve, protect and keep its
properties (specifically including but not limited to, the Projects) in good
repair, working order and condition, normal wear and tear excepted, and make
necessary and proper repairs, renewals and replacements so that its business
carried on in connection therewith may be properly conducted at all times.

                  SECTION 7.1.4 Books and Records. Borrower will, and,
consistent with Borrower's rights and obligations under the Operating
Agreement, will cause the Company to, keep books and records which accurately
reflect all of its business affairs and transactions in all material respects.
Borrower will, and will cause the Company to, permit the Lender at reasonable
times and intervals during normal business hours to examine and photocopy
extracts from any of 



<PAGE>   11

its books or other corporate records. The Borrower shall pay any fees of its
independent public accountant incurred in connection with the Lender's exercise
of its rights pursuant to this Section.

                  SECTION 7.1.5 Environmental Covenant. Borrower will, and,
consistent with Borrower's rights and obligations under the Operating
Agreement, will cause the Company to,

                          (a) use and operate all of its assets in compliance
                  in all material respects with all Environmental Laws, keep
                  all necessary and material permits, approvals, certificates,
                  licenses and other authorizations required under
                  Environmental Laws in effect and remain in compliance
                  therewith, and handle all Hazardous Materials in compliance
                  in all material respects with all Environmental Laws; and

                          (b) immediately notify the Lender and provide copies
                  upon receipt of all potentially material written claims,
                  complaints or notices (excluding routine fee or schedule
                  notices) relating to non-compliance with, or liabilities or
                  obligations arising under or relating in any way to,
                  Environmental Laws with respect to its assets.

                  SECTION 7.1.6 ERISA Compliance. Borrower will, and will cause
each of its ERISA affiliates to, maintain all employee benefit plans in
compliance in all material respects with all applicable law, including any
reporting requirements, and make all contributions due under the terms of each
employee benefit plan or as required by law.

                  SECTION 7.1.7 Additional Equity Funding . Prior to making a
request for any Advance (other than the Initial Advance), Borrower will,
through its Board of Directors, make written demand upon each Stockholder to
contribute to Borrower cash in an amount (such amount is termed such
Stockholder's "Additional Equity Contribution") equal to the product realized
by multiplying (i) a sum equal to at least one-third the amount of such
Advance, by (ii) a fraction, the numerator of which is the number of shares of
common stock of Borrower owned by such Stockholder and the denominator of which
is the number of outstanding shares of common stock of Borrower.
Notwithstanding anything to the contrary contained in this Agreement, no
additional Advance will be made to Borrower pursuant to this Agreement unless
and until each Stockholder has contributed cash to Borrower in an amount equal
to such Stockholder's Additional Equity Contribution with respect to such
Advance.

         SECTION 7.2 Negative Covenants. Borrower will comply with the
obligations set forth in this Section 7.2.

                  SECTION 7.2.1 Business Activities. Borrower will not engage
in any activity except for investment in accordance its Organic Documents in
entities identified in Exhibit A and activities incidental thereto (including
but not limited to providing guarantees and other credit enhancements).
Consistent with Borrower's rights and obligations under the Operating
Agreement, Borrower will not permit the Company to engage in any business
activity other than 


<PAGE>   12

those activities set forth in the Organic Documents for the Company.

                  SECTION 7.2.2 Indebtedness. The Borrower will not, and,
consistent with Borrower's rights and obligations under the Operating
Agreement, will not permit the Company to, create, incur, assume or suffer to
exist or otherwise become or be liable in respect of any indebtedness, other
than, without duplication, the following:

                          (a) indebtedness in respect of the Loan, the Term
                  Note, the Credit Note and other obligations to Lender; 

                          (b) unsecured Indebtedness incurred in the ordinary
                  course of its business in the nature of open accounts
                  extended by suppliers and other vendors on normal trade terms
                  in connection with purchases of goods and services, accrued
                  liabilities, deferred income and deferred taxes;

                          (c) Emergency Loans, as described in the Operating
                  Agreement;

                          (d) Third Party Loans in compliance with the
                  Borrowing Limits set forth in the Operating Agreement; and

                          (e) other unsecured Indebtedness of the Borrower in
                  an aggregate amount not to exceed $100,000.

                  SECTION 7.2.3 Asset Dispositions, etc. The Borrower will not,
and, consistent with Borrower's rights and obligations under the Operating
Agreement, will not permit the Company to, sell, transfer, lease, contribute,
convey or otherwise dispose of all or any part of its assets to any Person,
unless

                          (a) no Default has occurred and is continuing or
                  would occur after giving effect thereto; or

                          (b) such sale, transfer, lease or other disposition
                  is approved by Lender.

                  SECTION 7.2.4 Restriction on Distributions. Borrower will not
make dividend distributions to its shareholders at any time when there exists
an outstanding balance on the Loan.

                                  ARTICLE VIII
                               EVENTS OF DEFAULT

         SECTION 8.1 Listing of Events of Default. Each of the following events
or occurrences described in this Section 8.1 shall constitute an "Event of
Default." Upon the occurrence of an Event of Default (or any event or state of
facts which, with the giving of notice or the passage of time or both, would
constitute an Event of Default), the Borrower shall give notice thereof to the
Lender.

                  SECTION 8.1.1 Non-Payment of Obligations. The Borrower shall
default in the 



<PAGE>   13

payment when due of any principal of the Loan or of any interest in respect of
the Loan.

                  SECTION 8.1.2 Breach of Warranty. Any representation or
warranty made or deemed to be made hereunder or in any other Loan Document or
any other writing or certificate furnished by or on behalf of the Borrower to
the Lender for the purposes of or in connection with this Agreement or any such
other Loan Document is or shall be incorrect when made in any material respect.

                  SECTION 8.1.3 Non-Performance of Other Covenants and
Obligations. There shall be a default in the due performance and observance of
any other agreement contained herein or in any other Loan Document executed by
Borrower, and such default shall continue unremedied for a period of 30 days
after notice thereof shall have been given to the Borrower by the Lender.

                   SECTION 8.1.4  Bankruptcy, Insolvency, etc.  The Borrower 
or the Company  shall

                          (a) become insolvent or generally fail to pay, or
                  admit in writing its inability or unwillingness to pay, debts
                  as they become due;

                          (b) apply for, consent to, or acquiesce in, the
                  appointment of a trustee, receiver, sequestrator or other
                  custodian for the Borrower or the Company or any property of
                  any thereof, or make a general assignment for the benefit of
                  creditors;

                          (c) absent such application, consent or acquiescence
                  permit or suffer to exist the appointment of a trustee,
                  receiver, sequestrator or other custodian for the Borrower or
                  the Company or for a substantial part of the property of any
                  thereof, and such trustee, receiver, sequestrator or other
                  custodian shall not be discharged within 60 days, provided
                  that the Borrower and the Company hereby expressly authorize
                  the Lender to appear in any court conducting any relevant
                  proceeding during such 60-day period to preserve, protect and
                  defend their rights under the Loan Documents;

                          (d) permit or suffer to exist the commencement of any
                  (x) bankruptcy, reorganization, debt arrangement or other
                  case or proceeding under any bankruptcy or insolvency law, or
                  (y) any dissolution, winding up or liquidation proceeding, in
                  respect of the Borrower or the Company, and, if any such case
                  or proceeding is not commenced by the Borrower or the
                  Company, such case or proceeding shall be consented to or
                  acquiesced in by the Borrower or the Company or shall result
                  in the entry of an order for relief or, in the event of any
                  case or proceeding described in clause (x), shall remain for
                  120 days undismissed, provided that the Borrower, and the
                  Company hereby expressly authorizes the Lender and each
                  Lender to appear in any court conducting any such case or
                  proceeding during such 120-day period to preserve, protect
                  and defend their rights 


<PAGE>   14

                  under the Loan Documents; or

                          (e) take any limited liability company or corporate
                  action authorizing, or with intent to further any of the
                  foregoing.

         SECTION 8.2 Action if Bankruptcy. If any Event of Default described in
clauses (a) through (d) of Section 8.1.4 shall occur with respect to the
Borrower or the Company, the Commitment (if not theretofore terminated) to make
Advances shall automatically terminate and the outstanding principal amount of
the Loan shall automatically be and become immediately due and payable, without
notice or demand.

         SECTION 8.3 Action if Other Event of Default. If any Event of Default
(other than any Event of Default described in Section 8.2) shall occur for any
reason, whether voluntary or involuntary, and be continuing, the Lender, shall
by notice to the Borrower declare all or any portion of the outstanding
principal amount of the Loan and other obligations to be due and payable and
the Commitment (if not theretofore terminated) to be terminated, whereupon the
full unpaid amount of the Loan shall be and become immediately due and payable,
without further notice, demand or presentment and the Commitment shall
terminate.

                                   ARTICLE IX
                            MISCELLANEOUS PROVISIONS

         SECTION 9.1 Waivers, Amendments, etc. The provisions of this Agreement
and of each other Loan Document may from time to time be amended, modified or
waived, if such amendment, modification or waiver is in writing and consented
to by the Borrower and the Lender. No failure or delay on the part of the
Lender, or the holder of any Note in exercising any power or right under this
Agreement or any other Loan Document shall operate as a waiver thereof, nor
shall any single or partial exercise of any such power or right preclude any
other or further exercise thereof or the exercise of any other power or right.
No notice to or demand on the Borrower in any case shall entitle it to any
notice or demand in similar or other circumstances. No waiver or approval by
the Lender or the holder of any Note under this Agreement or any other Loan
Document shall, except as may be otherwise stated in such waiver or approval,
be applicable to subsequent transactions. No waiver or approval hereunder shall
require any similar or dissimilar waiver or approval thereafter to be granted
hereunder.

         SECTION 9.2 Notices. All notices and other communications provided to
any party hereto under this Agreement or any other Loan Document shall be in
writing and addressed, delivered or transmitted to such party at its address or
facsimile number set forth below its signature hereto, or at such other address
or facsimile number as may be designated by such party in a notice to the other
parties. Any notice, if sent via United States Postal Service Express Mail or
certified mail, properly addressed with postage prepaid or if sent via
nationally recognized overnight courier service, properly addressed with
delivery fees prepaid, shall be deemed given when received; any notice, if
transmitted by facsimile, shall be deemed given one business day after receipt
of electronic confirmation of transmission.

<PAGE>   15

         SECTION 9.3 Payment of Costs and Expenses. The Borrower agrees to pay
on demand all reasonable expenses of the Lender (including the reasonable fees
and out-of-pocket expenses of counsel to the Lender and of local counsel, if
any, who may be retained by counsel to the Lender) in connection with this
transaction

         SECTION 9.4  Indemnification.

                          (a) In consideration of the execution and delivery of
                  this Agreement by Lender and the extension of the
                  Commitments, the Borrower hereby indemnities, exonerates and
                  holds the Lender and each of its respective trustees,
                  partners, stockholders, officers, directors, employees,
                  agents, attorneys, consultants and experts (collectively, the
                  "Indemnified Parties") free and harmless from and against any
                  and all actions, causes of action, suits, judgments, claims,
                  demands, losses, costs, liabilities (including, without
                  limitation, strict liability), penalties, fines and damages,
                  (including, without limitation, punitive damages), and
                  expenses incurred in connection therewith (irrespective of
                  whether any such Indemnified Party is a party to the action
                  for which indemnification hereunder is sought), including
                  reasonable attorneys, consultants and experts fees and
                  disbursements (collectively, the "Indemnified Liabilities"),
                  imposed upon or incurred by the Indemnified Parties or any of
                  them as a result of, or arising out of, or relating to

                                (i) any transaction financed or to be financed
                          in whole or in part, directly or indirectly, with the
                          proceeds of the Loan;

                                (ii) the entering into and performance of this
                          Agreement and any other Loan Document by any of the
                          Indemnified Parties;

                                (iii) the actual or alleged release or presence
                          of any Hazardous Substance at, to or from any asset
                          or former asset of Borrower or the Company;

                                (iv) the actual or alleged violation of any
                          Environmental Law by any person at or in connection
                          with any current asset or former asset of Borrower
                          the Company;

                          except for any such Indemnified Liabilities arising
                          for the account of a particular Indemnified Party by
                          reason of the relevant Indemnified Party's gross
                          negligence or wilful misconduct, and if and to the
                          extent that the foregoing undertaking may be
                          unenforceable for any reason, the Borrower hereby
                          agrees to make the maximum contribution to the
                          payment and satisfaction of each of the Indemnified
                          Liabilities which is permissible under applicable
                          law, except as aforesaid to the extent not payable by
                          reason of the Indemnified Party's gross negligence or
                          wilful misconduct or breach of such obligations.

<PAGE>   16

                          (b) LENDER SHALL NOT BE RESPONSIBLE OR LIABLE TO ANY
                  OTHER PARTY HEREUNDER OR ANY OTHER PERSON FOR CONSEQUENTIAL
                  DAMAGES WHICH MAY BE ALLEGED AS A RESULT OF THE AGREEMENT OR
                  ANY OTHER LOAN DOCUMENT.

         SECTION 9.5 Severability. Any provision of this Agreement or any other
Loan Document which is prohibited or unenforceable in any jurisdiction shall,
as to such provision and such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions of this Agreement or such Loan Document or affecting the validity or
enforceability of such provision in any other jurisdiction.

         SECTION 9.6 Headings. The various headings of this Agreement and of
each other Loan Document are inserted for convenience only and shall not affect
the meaning or interpretation of this Agreement or such other Loan Document or
any provisions hereof or thereof.

         SECTION 9.7 Execution in Counterparts, Effectiveness, etc. This
Agreement may be executed by the parties hereto in several counterparts, each
of which shall be an original and all of which shall constitute together but
one and the same agreement. This Agreement, together with each other Loan
Document, shall become effective when counterparts hereof executed on behalf of
the Borrower and Lender (or notice thereof satisfactory to the Lender) shall
have been received by the Lender and notice thereof shall have been given by
the Lender to the Borrower.

         SECTION 9.8 Governing Law: Entire Agreement. THIS AGREEMENT, THE NOTES
NOTE AND EACH OTHER LOAN DOCUMENT SHALL EACH BE DEEMED TO BE A CONTRACT MADE
UNDER AND GOVERNED BY THE LAWS OF THE STATE OF TEXAS WITHOUT REGARD FOR
CONFLICT OF LAWS PRINCIPLES.

         THIS AGREEMENT, THE NOTE, THE AMENDED AND RESTATED SECURITY AGREEMENT
AND EACH OTHER LOAN DOCUMENT REFERENCED HEREIN REPRESENT THE FINAL AGREEMENTS
BETWEEN THE PARTIES WITH RESPECT TO THE LOAN AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

         SECTION 9.9 Successors and Assigns. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and assigns; provided, however, that the Borrower may not assign or
transfer its rights or obligations hereunder without the prior written consent
of the Lender.


<PAGE>   17

                                   ARTICLE X
                                  DEFINITIONS

         SECTION 10.1 Defined Terms. In addition to the terms defined in
previous portions of this Agreement, the following terms when used in this
Agreement shall, except where the context otherwise requires, have the
following meanings (such meanings to be equally applicable to the singular and
plural forms thereof):

         "Advance" means all money advances under the Loan made by Lender
pursuant to an Application for Advance in accordance with Article II.

         "Agreement" means, on any date, this Credit Agreement.

         "Application for Advance" means a loan request and certificate duly
executed by the Borrower, in the form which is attached hereto as Exhibit A or
such other form which is approved by Lender from time to time.

         "Borrower" means Crescent Development Management Corp., a Delaware
corporation, and its successors and assigns permitted hereunder.

         "Borrower Security Agreement" means the Amended and Restated Security
Agreement executed and delivered by Borrower granting Lender a security
interest in Borrower's membership interest in the Company and Borrower's
interest in the East West Partnerships.

         "Business Day" means any day which is neither a Saturday or Sunday nor
a legal holiday which banks are authorized or required to be closed in New
York, New York.

         "CERCLA" means the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended.

         "Code" means the Internal Revenue Code of 1986, as amended, reformed
or otherwise modified from time to time.

         "Commitment Termination Date" means the earliest of (i) the occurrence
of an Event of Default, (ii) the Stated Maturity Date, or (iii) the date on
which Lender has made Advances equal to the Commitment Amount.

         "Default" means any Event of Default or any condition, occurrence or
event which, after notice or lapse of time or both, would constitute an Event
of Default.

         "Distribution" means each Distribution (other than deemed
distributions) made to Borrower pursuant to Article V of the Operating
Agreement.

         "Emergency Loan" means each Emergency Loan made by Borrower pursuant
to Section 3.11 of the Operating Agreement.

         "Environmental Laws" means all applicable foreign, federal, state or
local statutes, laws, 


<PAGE>   18

ordinances, codes, rules, regulations (including, without limitation, consent
decrees and orders and administrative orders) judgments and permits or other
authorizations relating to health, safety or the environment, including,
without limitation, CERCLA and RCRA.

         "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute of similar import, together with the
regulations thereunder, in each case as in effect from time to time.

         "Event of Default" is defined in Section 8.1.

         " Funding Commitment Instruments" means the Funding Commitment
Instruments executed by John Goff, Gerald Haddock, Harry Frampton and Crescent
Real Estate Equities Limited Partnership effective as of January 1, 1998.

         "Governmental Authority" means the United States, the state, county
and city or other political subdivision in which a Project is located and any
other political subdivision, agency or instrumentality exercising jurisdiction
over the Borrower or the Company.

         "Governmental Requirement" means all laws, ordinances, rules and
regulations of any Governmental Authority applicable to Borrower or the
Company.

         "Hazardous Material" means any pollutant, hazardous substance,
radioactive substance, toxic substance, hazardous waste, medical waste,
radioactive waste, special waste, petroleum or petroleum-derived substance or
waste, asbestos, polychlorinated biphenyls, or any hazardous or toxic
constituent thereof and includes, but is not limited to, any substance defined
in or regulated under Environmental Laws.

         "Initial Advance" means the first Advance made hereunder, in an amount
not to exceed $7,818,000.

         "Loan" is defined in the preamble.

         "Loan Document" means this Agreement, the Note and all other documents
evidencing, securing or governing the Loan.

         "Note" means the Line of Credit Note of the Borrower delivered to a
Lender pursuant to this Agreement.

         "Organic Document" means, relative to Borrower and any of its
Subsidiaries, its articles or certificate of incorporation, as the case may be,
its articles of organization, its by-laws and all partnership agreements,
operating agreements, shareholder agreements, voting trusts and similar
arrangements applicable to any partnership or limited liability company
interests issued by such person or authorized shares of capital stock issued by
such person.

<PAGE>   19

         "Company" means East West Resorts, LLC, a Delaware limited liability
company.

         "Operating Agreement" means that certain Second Amended and Restated
Operating Agreement of East West Resorts, LLC dated January 1, 1998.

         "Person" means any natural person, corporation, partnership, firm,
association, trust, government, governmental agency or any other entity,
whether acting in an individual, fiduciary or other capacity.

         "RCRA" means the Resource Conservation and Recovery Act, 42 U.S.C.
Section 6901, et seq., as in effect from time to time.

         "Special Mandatory Payments" means those mandatory payments which are
attributable to the Borrower's receipt of a Distribution from the Company.

         "Stated Maturity Date" means January 1, 2003.

         "Stockholder" is defined in the Additional Funding Instruments to
include John Goff, Gerald Haddock, Harry Frampton and Lender.

         "Tax Distribution" means each Distribution made to Borrower pursuant
to Section 5.2 of the Operating Agreement.

         "UCC" means the Uniform Commercial Code as in effect, from time to
time, in the State of Texas.

         "United States" or "U.S." means the United States of America, its
fifty States and the District of Columbia.


                           [INTENTIONALLY LEFT BLANK]


<PAGE>   20


         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized as of the
day and year first above written.


BORROWER:                               CRESCENT DEVELOPMENT MANAGEMENT 
                                        CORP., a Delaware corporation


                                        By:
                                             ----------------------------
                                        Name:    
                                              ---------------------------
                                        Title:   
                                               --------------------------


LENDER:                                 CRESCENT REAL ESTATE EQUITIES LIMITED
                                            
                                        PARTNERSHIP, a Delaware limited 
                                        partnership

                                        By:  Crescent Real Estate Equities, 
                                             Ltd., Sole general partner


                                        By:
                                             ----------------------------
                                        Name:    
                                              ---------------------------
                                        Title:   
                                               --------------------------


<PAGE>   21

                                   EXHIBIT A

                            APPLICATION FOR ADVANCE

         This Application for Advance is submitted by the undersigned to
Crescent Real Estate Equities Limited Partnership ("Lender") pursuant to that
Credit Agreement dated as of January 1, 1998 between Lender and the undersigned
(the "Credit Agreement"). Capitalized terms used herein and not otherwise
defined shall have the meanings set forth in the Credit Agreement.

1.       The undersigned hereby requests an
         Advance under the Credit Agreement in
         the amount of:    $____________

2.       The undersigned hereby warrants and represents to Lender that both
         before and after giving effect to the Advance which is requested
         hereby, the warranties and representations set forth in Article VI of
         the Credit Agreement are true and correct with the same effect as if
         made on the date hereof.

3.       The undersigned hereby warrants and represents to Lender that both
         before and after giving effect to the Advance which is requested
         hereby, the conditions set forth in Article V of the Credit Agreement
         are satisfied.


                                        CRESCENT DEVELOPMENT MANAGEMENT 
                                        CORP., a Delaware corporation


                                        By:
                                             ----------------------------
                                        Name:    
                                              ---------------------------
                                        Title:   
                                               --------------------------



<PAGE>   22
                                  CREDIT NOTE


                                 $22,920,000.00                 January 1, 1998


         FOR VALUE RECEIVED, CRESCENT DEVELOPMENT MANAGEMENT CORP., a Delaware
corporation ("Borrower") promises to pay to CRESCENT REAL ESTATE EQUITIES
LIMITED PARTNERSHIP, a Delaware limited partnership ("Lender"), at 777 Main
Street, Suite 2100, Fort Worth, Texas 76102, the principal sum of [TWENTY-TWO
MILLION NINE HUNDRED TWENTY-FOUR THOUSAND FIVE HUNDRED AND NO/100 DOLLARS
($22,924,500.00)], or so much thereof as may be advanced, with interest on the
principal balance from time to time remaining unpaid at the rates hereinafter
provided.

         Interest on the principal balance hereof from time to time remaining
unpaid prior to an Event of Default shall be payable at the Interest Rate,
provided that the interest payable shall not exceed the maximum rate permitted
by applicable law (the "Maximum Rate"). Interest on the principal hereof from
time to time remaining unpaid and, to the extent permitted by applicable law,
interest on the unpaid interest, shall bear interest from and after an Event of
Default at the Default Rate provided that in no event shall the Default Rate be
more than the Maximum Rate.

         This Note is the "Note" referred to in the Credit Agreement dated of
even date herewith executed by Lender and Borrower (the "Credit Agreement").
Terms defined in the Credit Agreement and not otherwise defined herein are used
herein with the meanings given those terms in the Credit Agreement. To secure
payment of this Note, Borrower has granted Lender security interests in certain
assets of Borrower identified in that Amended and Restated Security Agreement
of even date herewith (the "Amended and Restated Security Agreement").

         Borrower may request and receive Advances hereunder only in accordance
with the terms and provisions of the Credit Agreement. Interest and principal
on this Note shall be payable as provided in Article 3 of the Credit Agreement.

         Upon the occurrence of any Event of Default (after the giving of any
notice required in the Credit Agreement and the expiration of any applicable
grace periods provided for in the Credit Agreement), all amounts then remaining
unpaid on this Note shall become or may be declared to be immediately due and
payable and the holder hereof shall have all rights and remedies of Lender
under the Credit Agreement and other Loan Documents (including but not limited
to the Amended and Restated Security Agreement). The failure to exercise the
option to accelerate the maturity of this Note upon the happening of any one or
more of the Events of Default hereunder shall not constitute a waiver of the
right of the holder of this Note to exercise the same or any other option at
that time or at any subsequent time with respect to such uncured default or any
other event of uncured default hereunder or under any other of the Loan
Documents (including but not limited to the Amended and Restated Security
Agreement). The remedies of the holder hereof, as provided in this Note and in
any other of the Loan Documents (including but not limited to the Amended and
Restated Security Agreement), shall be cumulative and concurrent and may be
pursued separately, successively or together, as often as occasion therefor
shall arise, at the sole discretion of the holder hereof. The acceptance by the
holder hereof of any payment under this Note which is less than payment in full
of all amounts due and payable at the time of such payment shall not constitute
a waiver of or impair, reduce, release or extinguish any of the rights or
remedies of the holder hereof to exercise the foregoing option or any other
option granted to the holder in this Note or in any other of the Loan Documents
(including but not limited to the Amended and Restated Security Agreement), at
that time or at any subsequent time, or nullify any prior exercise of any such
option.


<PAGE>   23


         The undersigned and all other parties now or hereafter liable for the
payment hereof, whether as endorser, surety or otherwise, except as provided in
the Credit Agreement, severally waive demand, presentment, notice of dishonor,
notice of intention to accelerate the indebtedness evidenced hereby, notice of
the acceleration of the maturity hereof, diligence in collecting, grace, notice
and protest, and consent to all extensions which from time to time may be
granted by the holder hereof and to all partial payments hereon, whether before
or after maturity.

         If this Note is not paid when due, whether at maturity or by
acceleration, or if it is collected through a bankruptcy, probate or other
court, whether before or after maturity, the undersigned agrees to pay all
costs of collection, including, but not limited to, reasonable attorneys' fees
and expenses incurred by the holder hereof.

         All agreements between the undersigned and the holder hereof, whether
now existing or hereafter arising and whether written or oral, are hereby
limited so that in no contingency, whether by reason of acceleration of the
maturity hereof or otherwise, shall the interest contracted for, charged,
received, paid or agreed to be paid to the holder hereof exceed the maximum
amount permissible under applicable law. If from any circumstance the holder
hereof shall ever receive anything of value deemed interest by applicable law
in excess of the maximum lawful amount, an amount equal to any excessive
interest shall be applied to the reduction of the principal hereof and not to
the payment of interest, or if such excessive interest exceeds the unpaid
balance of principal hereof, such excess shall be refunded to the undersigned.
All interest paid or agreed to be paid to the holder hereof shall, to the
extent permitted by applicable law, be amortized, prorated, allocated, and
spread throughout the full period until payment in full of the principal so
that the interest hereon for such full period shall not exceed the maximum
amount permitted by applicable law. This paragraph shall control all agreements
between the undersigned and the holder hereof.

         This Note may be prepaid only in accordance with the terms of the
Credit Agreement.

         The loan transaction evidenced hereby shall not be governed by, or be
subject to, Chapter 15 or Chapter 346 of the Texas Credit Code or Chapter 303
of the Texas Finance Code.

         EXCEPT WHERE FEDERAL LAW IS APPLICABLE (INCLUDING, WITHOUT LIMITATION,
ANY FEDERAL USURY CEILING OR OTHER FEDERAL LAW WHICH, FROM TIME TO TIME, IS
APPLICABLE TO THE INDEBTEDNESS EVIDENCED HEREIN AND WHICH PREEMPTS STATE USURY
LAWS), THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
TEXAS AND THE LAWS OF THE UNITED STATES APPLICABLE TO TRANSACTIONS IN SUCH
STATE.

         THIS NOTE, TOGETHER WITH THE CREDIT AGREEMENT, THE AMENDED AND
RESTATED SECURITY AGREEMENT AND EACH OTHER LOAN DOCUMENT REFERENCED HEREIN OR
THEREIN, REPRESENT THE FINAL AGREEMENTS BETWEEN THE PARTIES WITH RESPECT TO THE
LOAN AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.


                                       CRESCENT DEVELOPMENT MANAGEMENT CORP.,
                                       a Delaware corporation



                                       By:
                                          -------------------------------------
                                       Name: 
                                            -----------------------------------
                                       Title: 
                                             ----------------------------------
<PAGE>   24

                    AMENDED AND RESTATED SECURITY AGREEMENT
                     (Membership and Partnership Interests)

                                                          Date: January 1, 1998

         This Amended and Restated Security Agreement (this "Security
Agreement") amends and restates in its entirety that Security Agreement dated
February 29, 1996 (the"Original Security Agreement") between Secured Party and
Debtor.

RECITALS

         1. Contemporaneously with the Original Security Agreement, Secured
Party advanced to Debtor the sum of $3.1 million, evidenced by that Promissory
Note dated February 29, 1996; that note remains outstanding and held by Secured
Party. Payment of that note is secured by all of Debtor's rights and interests
as a member of the Company plus other collateral incidental thereto.

         2. Debtor has requested Secured Party to agree to advance up to an
additional $22,920,000 which Debtor may from time to time use to make
additional capital contributions to the Company.

         3. Secured Party has agreed to advance such additional funds on the
terms of that Credit Agreement of even date herewith between Secured Party and
Debtor.

A.       PARTIES

         1.  Secured Party:   CRESCENT REAL ESTATE EQUITIES LIMITED PARTNERSHIP
                                   777 Main Street, Suite 2700
                                   Fort Worth, TX  76102

         2.  Debtor (whether
             one or more):    CRESCENT DEVELOPMENT MANAGEMENT CORP.
                                   C/O Harry Frampton
                                   100 East Thomas Place, Drawer 2770
                                   Avon, Colorado  81620

                                   Attention:  Harry Frampton

B.       AGREEMENT

         1. Security Interest. Subject to the applicable terms of this Security
Agreement, Debtor continues, reconfirms and grants to Secured Party a security
interest in the Collateral (hereinafter defined) to secure the payment of the
Obligations (hereinafter defined).

C.       OBLIGATIONS

         1. Description of Obligations. The following obligations
("Obligations") are secured by this Security Agreement:

         a. The debt, obligations, liabilities and agreements of Debtor under
(i) that Promissory Note in the original principal amount of $3.1 million dated
February 29, 1996 (the "Term Note"), (ii) that Credit Note in the principal sum
of $22,920,000 executed by Debtor of even date herewith, bearing interest and
being payable to Secured Party as therein provided (the "Credit Note"; the Term
Note and the Credit Note together are the "Notes"), (iii) that Credit Agreement
("Credit Agreement") executed by Debtor and Secured Party of even date
herewith, (iv) all other documents evidencing, 


<PAGE>   25


governing, securing or otherwise pertaining to the indebtedness evidenced by
the Notes (the Notes, Credit Agreement and all other such documents being
called "Loan Documents"), and (v) all renewals, extensions, modifications or
rearrangements of the foregoing.

              b. All costs incurred by Secured Party to obtain, preserve,
         perfect and enforce this Security Agreement and collect the
         Obligations, and maintain, preserve, collect and enforce the
         Collateral (hereinafter defined), including but not limited to
         reasonable attorneys' fees and legal expenses and expenses of sale.

              c. Interest on the above amounts at the Default Rate as defined
         in the Notes.

              d. All debt, obligations and liabilities of Debtor to Secured
         Party of the kinds described in this Item C., now existing or
         hereafter arising.

D.       COLLATERAL

         1. Description of the Collateral. Debtor has assigned and granted to
Secured Party, and hereby continues, reconfirms and grants to Secured Party,
security interests in the following, whether now existing or hereafter arising
(the "Collateral"):

              a. All of the rights and interests of Debtor as a member of East
         West Resorts, LLC, a Delaware limited liability company (the
         "Company"), including, without limitation, Debtor's rights as a member
         to receive distributions of any sale, exchange, refinancing or other
         disposition of property owned by the Company under the Second Amended
         and Restated Operating Agreement entered into effective as of January
         1, 1998, as amended from time to time hereafter (the "Operating
         Agreement"), and all other profits, income, and distributions, whether
         in cash or in kind, owing to Debtor under the Operating Agreement.

              b. All of the rights and interests of Debtor as a limited partner
         of East West Resort Development, L. P., a Delaware limited partnership
         ("EWRD"), including, without limitation, Debtor's rights as a member
         to receive distributions of any sale, exchange, refinancing or other
         disposition of property owned by EWRD under the Limited Partnership
         Agreement dated as of August 11, 1995, as subsequently amended (as
         amended from time to time hereafter, the "EWRD Partnership
         Agreement"), and all other profits, income, and distributions, whether
         in cash or in kind, owing to Debtor under the EWRD Partnership
         Agreement.

              c. All of the rights and interests of Debtor as a limited partner
         of East West Resort Development II, L. P., a Delaware limited
         partnership ("EWRD2"), including, without limitation, Debtor's rights
         as a member to receive distributions of any sale, exchange,
         refinancing or other disposition of property owned by EWRD2 under the
         Limited Partnership Agreement dated as of September 26, 1996, as
         subsequently amended (as amended from time to time hereafter, the
         "EWRD2 Partnership Agreement"), and all other profits, income, and
         distributions, whether in cash or in kind, owing to Debtor under the
         EWRD2 Partnership Agreement.

              d. All of the rights and interests of Debtor as a limited partner
         of EWRD Summit Holding, L. P., a Delaware limited partnership
         ("Summit"), including, without limitation, Debtor's rights as a member
         to receive distributions of any sale, exchange, refinancing or other
         disposition of property owned by Summit under the Limited Partnership
         Agreement dated as of September 23, 1997, as subsequently amended (as
         amended from time to time hereafter, the "Summit Partnership
         Agreement"), and all other profits, income, and distributions, whether
         in cash or in kind, owing to Debtor under the EWRD Partnership
         Agreement.

              e. All Partner Loans and Default Loans (as defined in the EWRD
         Partnership Agreement) now or hereafter owing to Debtor and all
         security therefor.

              f. All present and future rights and interests Debtor may have or
         be or become entitled to in the real and personal property (the
         "Collateral Property") now or hereafter owned by the Company or
         Partnerships.

              g. All present and future proceeds, profits, combinations,
         reclassification, improvements, and 


<PAGE>   26


         products of, accessions, attachments, and other additions to, and
         substitutes and replacements for, all or any part of the Collateral
         described herein.

              h All present and future accounts, contract rights, general
         intangibles, chattel paper, documents, instruments, cash and noncash
         Proceeds, and other rights arising from or by virtue of, or from the
         voluntary or involuntary sale, lease, or other disposition of, or
         collections with respect to, or insurance or condemnation proceeds
         payable with respect to, or proceeds payable by virtue of warranty,
         indemnity, guaranty, or other claims, causes and rights of action,
         settlements thereof, judicial and arbitration judgments and awards
         against any person with respect to, all or any part of the Collateral
         or the Collateral Property described herein. As used herein, the term
         "Proceeds" shall have the meaning assigned to it under the UCC and, to
         the extent not otherwise included, shall include, but not be limited
         to, (i) all income, revenues, fees, distributions, reimbursements and
         payments from whatever source received by, or on behalf of Debtor, in
         respect of the Collateral, (ii) any and all payments (in any form
         whatsoever) made or due and payable to Debtor from time to time in
         connection with any casualty with respect to the Collateral Property
         or any of the Collateral (whether or not pursuant to an insurance
         policy), or any requisition, confiscation, condemnation, seizure or
         forfeiture of all or any part of the Collateral by any governmental
         authority, (iii) all claims of Debtor for losses or damages arising
         out of or related to or for any breach of any agreements, covenants,
         representations or warranties or any default under any of the
         Collateral described herein, and (iv) any and all other amounts from
         time, to time paid or payable to, or on behalf of, Debtor under, or in
         connection with, any of the Collateral.

              i All present and future security for the payment to Debtor of
         any of the Collateral described herein and goods which gave, or will
         give, rise to any of such Collateral or are evidenced, identified, or
         represented therein or thereby.

         EWRD, Summit and EWRD2 are collectively the "Partnerships." The EWRD
Partnership Agreement, the Summit Partnership Agreement and the EWRD2
Partnership Agreement are collectively the "Partnership Agreements."

         The description of Collateral contained in this paragraph shall not be
deemed to permit any action prohibited by this Security Agreement or by terms
incorporated in this Security Agreement. Portions of the Collateral constitute
accounts, contract rights, general intangibles, chattel paper, documents or
instruments, and all books and records of Debtor concerning such Collateral
are, and shall be, located at the offices of the Debtor specified above.

E.       DEBTOR'S WARRANTIES

         Debtor represents, warrants, and covenants to Secured Party now and so
long as any Obligations secured hereby are outstanding as follows:

         1. No financing statement covering any portion of the Collateral is on
file in any public office, except the financing statements relating to this
security interest created hereunder or under the Original Security Agreement or
except for statements in favor of Lender as a secured party.

         2. Debtor is the sole owner of the Collateral and each item
constituting the Collateral, free and clear of all liens except for the
security interest granted to Secured Party pursuant to this Security Agreement
or other security interests in favor of Lender.

         3. All actions necessary or desirable to perfect the Security Interest
in the Collateral in each state in which any portion of the Collateral is or
will be located have been, or will forthwith be, duly taken.

         4. The Operating Agreement and the Partnership Agreements each is in
full force and effect and, to the knowledge of Debtor, there exists no material
default thereunder, or event or condition which, with the passage of time or
the giving of notice, or both, would constitute a material default thereunder.

         5. The Operating Agreement and the Partnership Agreements each shall
not be amended or modified in 


<PAGE>   27


any manner that would materially affect Debtor's interest thereunder, or in any
manner which would materially impair or adversely affect the Collateral, nor
shall Debtor consent to any such amendment without the prior written consent of
Secured Party.

         6. There is no condition, circumstance, event, agreement, document,
instrument, restriction, litigation or other proceeding and, to the best of
Debtor's knowledge, there is no threatened litigation or proceeding or basis
therefor, which could materially adversely affect the validity or priority of
the liens and security interests granted, or intended to be granted, hereunder
when executed, delivered, recorded and filed as required hereunder, or that
could materially adversely affect the ability of Debtor to perform its
obligations hereunder and under the other Loan Documents to which Debtor is a
party, or which would constitute an Event of Default.

         7. The Company and Debtor have fully complied with all requirements
imposed on them in connection with (a) the organization and formation of the
Company and the Partnerships, and (b) the sale, distribution and offer of
membership interests in the Company and the Partnerships.

F.       DEBTOR'S COVENANTS

         Debtor covenants to Secured Party and agrees with Secured Party as
follows:

         1. Debtor shall promptly perform all of Debtor's agreements herein,
and any other agreements between Debtor and Secured Party.

         2. Debtor shall defend the Collateral against all claims and demands
of all persons at any time claiming the same or any interest therein adverse to
Secured Party.

         3. Debtor shall keep the Collateral free from liens and other security
interests (except liens for taxes not yet due), and shall not create or suffer
to exist any lien or security interest in the Collateral hereafter acquired
except for the security interests hereby granted. Debtor shall not file, or
permit to be filed, any financing statements or other security instruments
covering the Collateral, unless by, or on behalf of, Secured Party in
connection with this Security Agreement or other security agreements between
Debtor and Secured Party or to effectuate the assignment to Debtor of the
financing statements currently of record against the Collateral.

         4. Debtor shall pay all costs necessary to obtain, preserve, perfect,
defend and enforce the security interests hereby granted, collect the sums
owing under the Collateral Loan Documents, and preserve, defend, enforce,
service and collect the Collateral, including specifically, but without
limitation, the payment of taxes, assessments, reasonable attorneys' fees and
legal expenses, and expenses of sales. If Debtor shall have failed to pay such
costs and expenses within five (5) days after request by Secured Party, Secured
Party may, at its option, pay any such costs and expenses, and discharge
encumbrances on the Collateral. Debtor agrees to reimburse the Secured Party on
demand for any costs so incurred, and, until such reimbursement, the amount of
any such payment shall be a part of the Obligation.

         5. Prior to or immediately following the occurrence thereof, Debtor
will notify the Secured Party of (i) any material adverse change occurring in
or to any of the Collateral, (ii) any change in Debtor's office address or
mailing address, (iii) any material change in any fact or circumstance
warranted or represented by Debtor in this Security Agreement or furnished to
the Secured Party by Debtor, (iv) any Event of Default or (v) any notices,
communications, or correspondence to be or which have been delivered to Debtor
under the Operating Agreement or the Partnership Agreements and deliver to
Secured Party copies thereof.

         6. Debtor shall execute and deliver to Secured Party a financing
statement for filing to perfect the security interests hereunder and any other
papers furnished by Secured Party which are necessary in the judgment of
Secured Party to obtain, maintain and perfect the security interest hereunder
and to enable Secured Party to comply with any applicable federal or state law
in order to obtain or perfect Secured Party's interest in the Collateral.
Debtor shall have the Company and the Partnerships make appropriate entries in
their records to reflect the existence of the security interest granted hereby
in the Collateral.



<PAGE>   28


         7. Debtor shall cause the Company to comply with all of the
representations, warranties, covenants, agreements, indemnities and terms
contained in the Company's and the Partnerships' Organizational Documents and
all other material agreements to which it is bound and enforce the Company's
rights under all material agreements by which it is bound, in a timely manner,
consistent with prudent practices and all applicable laws, and also as required
by Secured Party.

         8. Debtor shall fully perform all of Debtor's duties under and in
connection with each transaction to which the Collateral, or any part thereof,
relates, so that the amounts thereof shall actually become payable in their
entirety to Secured Party.

         9. Debtor shall promptly notify Secured Party of any claim, action, or
proceeding affecting title to all or any of the Collateral or the security
interest and, at the request of Secured Party, appear in and defend, at
Debtor's expense, any such claim, action, demand or proceeding.

         10. At Debtor's expense and upon Secured Party's request, after an
Event of Default, Debtor shall file or cause to be filed such applications and
take such other actions as Secured Party may request to obtain the consent or
approval of any governmental authority to Secured Party's rights hereunder,
including, without limitation, the right to sell all of the Collateral upon an
Event of Default without additional consent or approval from such governmental
authority (and, because Debtor agrees that Secured Party's remedies at law for
failure of Debtor to comply with this provision would be inadequate and that
such failure would not be adequately compensable in damages, Debtor agrees that
its covenants in this provision may be specifically enforced).

         11. Upon demand by Secured Party, Debtor will deposit upon receipt all
checks, drafts, cash or other remittances on account or accounts or contracts
or received as proceeds of any other Collateral in a special bank account in a
bank of Secured Party's choice over which Secured Party alone shall have power
of withdrawal. The funds in said account shall be held by Secured Party as
security for the Obligation. Said proceeds shall be deposited in the form
received, except for the endorsement of Debtor where necessary to permit
collection of items, which endorsements Debtor agrees to make, but which
Secured Party is authorized to make on Debtor's behalf. Secured Party may from
time to time apply the whole or any part of the funds in such special account
against the Obligations. Any portion of said funds on deposit which Secured
Party elects not to apply to the Obligations may be paid by Secured Party to
Debtor.

         12. Debtor shall give Secured Party written notice of each office of
Debtor in which records of Debtor pertaining to accounts in the Collateral are
kept, and of any change of any office or location. Except as such notice is
given, all records of Debtor pertaining to the Collateral and to accounts are
and shall be kept in the location shown at the beginning hereof.

G.       RIGHTS AND POWERS OF SECURED PARTY

         1. Secured Party may in its discretion after an Event of Default but
only after prior written notice to Debtor, without liability to Debtor, obtain
from any person information regarding Debtor or Debtor's business, which
information any such person also may furnish without liability to Debtor;
endorse as Debtor's agent any instruments, documents or chattel paper in the
Collateral or representing proceeds of the Collateral; contact any account
debtors directly to verify information furnished by Debtor; take control of
proceeds; release the Collateral in its possession to any Debtor, temporarily
or otherwise; after default, take control of funds generated by the Collateral,
such as cash dividends, interest and proceeds or refunds from insurance, and
use same to reduce any part of the Obligations and exercise all other rights
which an owner of such collateral may exercise; after default, at any time
transfer any of the Collateral or evidence thereof into its own name or that of
its nominee; demand, collect, convert, redeem, receipt for, settle, compromise,
adjust, sue for, foreclose or realize upon the Collateral, in its own name or
in the name of Debtor, as Secured Party may determine. The foregoing rights and
powers of Secured Party will be in addition to, and not a limitation upon, any
rights and powers of Secured Party given by law, elsewhere in this agreement,
or otherwise.

         2. Secured Party may while any Event of Default continues hereunder
present for conversion any 



<PAGE>   29


instrument (including any investment security) in the Collateral which is
convertible into any other instrument or investment security or a combination
thereof with cash. But Secured Party shall not have any duty to present for
conversion any instrument in the Collateral unless it shall have received from
Debtor written instructions to that effect at a time reasonably far in advance
of the final conversion date to make such conversion possible.

H.       DEFAULT

         1. Events of Default. The occurrence of a default under either Note,
the Credit Agreement or any document evidencing, governing, securing,
guaranteeing, indemnifying or otherwise pertaining to the Loan shall constitute
an event of default ("Event of Default") hereunder.

         2. Remedies of Secured Party Upon Default. Should an Event of Default
occur and be continuing, Secured Party may, at its election, exercise any and
all rights and remedies available to a secured party under the UCC, in addition
to any and all other rights and remedies afforded by the Loan Documents, at
law, in equity, or otherwise, including, without limitation, such rights and
remedies as (a) Secured Party, (b) applying by appropriate judicial proceedings
for appointment of a receiver for all or part of the Collateral (and Debtor
hereby consents to any such appointment), and (c) applying to the Obligation
any cash held by Secured Party under this Security Agreement. The exercise of
one or more rights or remedies by Secured Party hereunder shall not prejudice
or impair the concurrent or subsequent exercise of any other rights or remedies
by Secured Party. If, in the opinion of Secured Party, there is any question
that a public or semipublic sale or distribution of any Collateral will violate
any state or federal securities law, Secured Party in its discretion (a) may
offer and sell securities privately to purchasers who will agree to take them
for investment purposes and not with a view to distribution and who will agree
to imposition of restrictive legends on the certificates representing the
security, or (b) may sell such securities in an intrastate offering under
Section 3(a)(11) of the Securities Act of 1933, and no sale so made in good
faith by Secured Party shall be deemed to be not "commercially reasonable"
because so made.

              a. Notice. Reasonable notification of the time and place of any
         public sale of the Collateral, or reasonable notification of the time
         after which any private sale or other intended disposition of the
         Collateral is to be made, shall be sent to Debtor and to any other
         Person entitled to notice under the UCC. It is agreed that notice sent
         or given not less than twenty (20) business days prior to the taking
         of the action to which the notice relates is reasonable notification
         and notice for the purposes of this subparagraph.

              b. Application of Proceeds. Secured Party shall apply the
         proceeds of any sale or other disposition of the Collateral under this
         paragraph in the following order: first, to the payment of all its
         expenses incurred in retaking, holding, and preparing any of the
         Collateral for sale(s) or other disposition, in arranging for such
         sale(s) or other disposition, and in actually selling or disposing of
         the same (all of which are part of the Obligation); second, toward
         repayment of amounts expended by Secured Party under Paragraph I.3;
         and third, toward payment of the balance of the Obligation in
         accordance with the Credit Agreement. If the proceeds are insufficient
         to pay the Obligation in full, Debtor shall remain liable for any
         deficiency.

         3.   Other Rights of Secured Party.

              a. Performance. In the event Debtor shall fail to pay when due
         all taxes on any of the Collateral, or to preserve the priority of the
         Security Interest in any of the Collateral, or otherwise fail to
         perform any of its obligations under the Loan Documents with respect
         to the Collateral, then Secured Party may, at its option, but without
         being required to do so, pay such taxes, prosecute or defend any suits
         in relation to the Collateral, or insure and keep insured the
         Collateral in any amount deemed appropriate by Secured Party, or take
         all other action which Debtor is required, but has failed or refused,
         to take under the Loan Documents. Any sum which may be expended or
         paid by Secured Party under this subparagraph (including, without
         limitation, court costs and attorneys' fees) shall bear interest from
         the dates of expenditure or payment at the Default Rate (as defined in
         the Note) until paid and, together with such interest, shall be
         payable by Debtor to Secured Party upon demand and shall be part of
         the Obligation.

              b. Collection. After the occurrence of an Event of Default and
         during the continuation thereof, 



<PAGE>   30


         upon notice from Secured Party, Maker and each other obligor with
         respect to any payments on any of the Collateral (including without
         limitation condemnation proceeds, dividends and other distributions
         with respect to securities, and insurance proceeds payable by reason
         of loss or damage to any of the Collateral Property) is hereby
         authorized and directed by Debtor to make payment directly to Secured
         Party, regardless of whether Debtor was previously making collections
         thereon. Subject to Subparagraph I.3(d) hereof, until such notice is
         given, Debtor is authorized to retain and expend all payments made on
         the Collateral. After the occurrence of an Event of Default and during
         the continuation thereof, Secured Party shall have the right in its
         own name or in the name of Debtor to compromise or extend the time of
         payment with respect to all or any portion of the Collateral for such
         amounts and upon such terms as Secured Party may determine; to demand,
         collect, receive, receipt for, sue for, compound, settle, compromise,
         adjust, realize upon and give acquittances for any and all amounts due
         or to become due with respect to Collateral; to file any claims or
         take any action or initiate any proceedings which Secured Party may
         deem necessary or desirable for the collection of any of the
         Collateral or to otherwise enforce the rights or remedies of Debtor
         with respect to any Collateral; to take control of cash and other
         Proceeds of any Collateral; to endorse the name of Debtor on any
         notes, acceptances, checks, drafts, money orders, or other evidences
         of payment on Collateral that may come into the possession of Secured
         Party; to sign the name of Debtor on any drafts against obligors or
         other Persons making payment with respect to Collateral, on
         assignments and verifications of accounts or other Collateral and on
         notices to obligors making payment with respect to Collateral; to send
         requests for verification of obligations to any such obligor; to take
         any action Debtor is required to take or any other necessary action to
         obtain, preserve, and enforce this Security Agreement, and maintain,
         preserve and collect the Collateral, without notice to Debtor, and add
         the costs of same to the Obligation; to release Collateral in Secured
         Party's possession to any Person, temporarily or otherwise; to set
         standards from time to time to govern what may be deemed
         after-acquired Collateral; to transfer any of the Collateral, or
         evidence thereof, into its own name or that of its nominee and receive
         the Proceeds therefrom and hold the same as security for the
         Obligation, or apply the same thereon; to exercise as to the
         Collateral all the rights of the owner thereof; and to do all other
         acts and things necessary to carry out the intent of this Security
         Agreement. If Maker or any other obligor fails or refuses to make
         payment on any Collateral when due, Secured Party is authorized, in
         its sole discretion, either in its own name or in the name of Debtor,
         to take such action as Secured Party shall deem appropriate for the
         collection of any amounts owed with respect to the Collateral or upon
         which a delinquency exists. Regardless of any other provision hereof,
         however, Secured Party shall never be liable for its failure to
         collect, or for its failure to exercise diligence in the collection
         of, any amounts owed with respect to Collateral, nor shall it be under
         any duty whatever to anyone except Debtor to account for funds that it
         shall actually receive hereunder. Without limiting the generality of
         the foregoing, Secured Party shall have no responsibility for
         ascertaining any maturities, calls, conversions, exchanges, offers,
         tenders, or similar matters relating to any Collateral, or for
         informing Debtor with respect to any of such matters (irrespective of
         whether Secured Party actually has, or may be deemed to have,
         knowledge thereof). The receipt of Secured Party to Maker or any other
         obligor shall be a full and complete release, discharge, and
         acquittance to such obligor, to the extent of any amount so paid to
         Secured Party.

              c. Certain Proceeds. After the occurrence and during the
         continuance of an Event of Default, any cash Proceeds of Collateral
         which come into the possession of Secured Party (including, without
         limitation, insurance and condemnation proceeds) may, at Secured
         Party's option, be applied in whole or in part to the Obligation, be
         released in whole or in part to or on the written instructions of
         Debtor for any general or specific purpose, or be retained in whole or
         in part by Secured Party as additional Collateral. Any cash Collateral
         in the possession of Secured Party may be invested by Secured Party
         but Secured Party shall never be obligated to make any such investment
         and shall never have any liability to Debtor for any loss which may
         result therefrom. All interest and other amounts earned from any
         investment of Collateral may be dealt with by Secured Party in the
         same manner as other cash Collateral.

              d. Use and Operation of Collateral. Should any Collateral come
         into the possession of Secured Party, Secured Party may use or operate
         such Collateral for the purpose of preserving it or its value pursuant
         to the order of a court of appropriate jurisdiction or in accordance
         with any other rights held by Secured Party with respect to such
         Collateral. Debtor covenants promptly to reimburse and pay to Secured
         Party, at Secured Party's request, the amount of all reasonable
         expenses (including, without limitation, the cost of any insurance and


<PAGE>   31


         payment of taxes or other charges) incurred by Secured Party in
         connection with its custody and preservation of Collateral, and all
         such expenses, costs, taxes, and other charges shall bear interest at
         the Maximum Rate (as defined in the Note) until repaid and, together
         with such interest, shall be payable by Debtor to Secured Party upon
         demand and shall become part of the Obligation. However, the risk of
         accidental loss or damage to, or diminution in value of, Collateral is
         on Debtor, and Secured Party shall have no liability whatever for
         failure to obtain or maintain insurance, nor to determine whether any
         insurance ever in force is adequate as to amount or as to the risks
         insured. With respect to Collateral that is in the possession of
         Secured Party, Secured Party shall have no duty to fix or preserve
         rights against prior parties to such Collateral and shall never be
         liable for any failure to use diligence to collect any amount payable
         in respect of such Collateral, but shall be liable only to account to
         Debtor for what it may actually collect or receive thereon. The
         provisions of this subparagraph shall be applicable whether or not an
         Event of Default has occurred and is continuing.

              e. Diminution in Value of Collateral. Secured Party shall have no
         liability or responsibility whatsoever for any diminution in or loss
         of value of any Collateral.

I.       MULTIPLE COUNTERPARTS

         This Security Agreement may be executed in counterparts, each of which
shall be deemed an original, and all of which shall be deemed but one and the
same instrument.

J.       GENERAL

         1. Waiver. No delay on the part of Secured Party in exercising any
power or right shall operate as a waiver thereof; nor shall any single or
partial exercise of any power or right preclude other or further exercise
thereof or the exercise of any other power or right. No waiver by Secured Party
of any right hereunder or of any default by Debtor shall be binding upon
Secured Party unless in writing, and no failure by Secured Party to exercise
any power or right hereunder or waiver of any default by Debtor shall operate
as a waiver of any other or further exercise of such right or power or of any
further default.

         2. Parties Bound. The rights of Secured Party hereunder shall inure to
the benefit of its successors and assigns. The terms of this Security Agreement
shall be binding upon the successors and assigns of the parties. All
representations, warranties and agreements of Debtor are joint and several if
Debtor is more than one and shall bind Debtor's personal representatives,
heirs, successors and assigns.

         3. Definitions. Unless the context indicates otherwise, definitions in
the UCC apply to words and phrases in this Security Agreement; if UCC
definitions conflict, Chapter 9 definitions apply.

         4. Notice. Notice shall be deemed reasonable if mailed postage prepaid
at least ten (10) days before the related action (or if the UCC elsewhere
specifies a longer period, such longer period) to Debtor's address given above.

         5. Expenses. Debtor agrees to reimburse Secured Party's out-of-pocket
expenses, including reasonable attorney's fees, incurred in negotiating,
administering or enforcing any part of the Obligations, and in preparation,
execution, delivery and recording of any documents in connection with any part
of the Obligations, when not contrary to law.

         6. Limitation on Interest. All agreements between Debtor and Secured
Party, whether now existing or hereafter arising and whether written or oral,
are hereby expressly limited so that in no contingency, whether by reason of
demand or acceleration of the indebtedness secured hereby or otherwise, shall
the interest contracted for, charged, received, paid or agreed to be paid to
Secured Party exceed the maximum amount permissible under applicable law. If,
from any circumstance whatsoever interest would otherwise be payable to the
holder hereof in excess of the maximum lawful amount, the interest payable to
Secured Party shall be reduced to the maximum amount permitted under applicable
law; and if from any such circumstance Secured Party shall ever receive
anything of value deemed interest by applicable law in excess of the maximum
lawful amount, an amount equal to any excessive interest shall be applied to
the reduction 


<PAGE>   32


of the principal amount owing on the indebtedness secured hereby and not to the
payment of interest, or if such excessive interest exceeds such unpaid balance
of the principal, such excess shall be refunded to the undersigned. All
interest paid or agreed to be paid to Secured Party on the indebtedness secured
hereby shall, to the extent permitted by applicable law, be amortized,
prorated, allocated and spread throughout the full term of such indebtedness
(including the period of any renewal or extension thereof) until payment in
full so that the interest on account of such indebtedness shall not exceed the
maximum amount permitted by applicable law. The terms and provisions of this
paragraph shall control all agreements between Debtor and Secured Party.

         7. Modifications. No provision hereof shall be modified or limited
except by a written agreement expressly referring hereto and to the provision
so modified or limited and signed by the Debtor and Secured Party, nor by
course of conduct, usage of trade, or by the law merchant.

         8. Severability. The unenforceability of any provision of this
Security Agreement shall not affect the enforceability or validity of any other
provision.

         9. Gender and Number. Where appropriate, the use of one gender shall
be construed to include the others or any of them; and the singular number
shall be construed to include the plural, and vice versa.

         10. Applicable Law and Venue. THIS SECURITY AGREEMENT SHALL BE
CONSTRUED ACCORDING TO THE LAWS OF THE STATE OF TEXAS.

         11. Financing Statement. A carbon, photographic or other reproduction
of this Security Agreement or any financing statement covering the Collateral
shall be sufficient as a financing statement.

<PAGE>   33


         EXECUTED as of the date and year first above written.

DEBTOR:                                CRESCENT DEVELOPMENT MANAGEMENT CORP.,
                                       a Delaware corporation




                                       By:
                                          -------------------------------------
                                       Name:
                                            -----------------------------------
                                       Title 
                                            -----------------------------------




SECURED PARTY:                         CRESCENT REAL ESTATE EQUITIES LIMITED
                                       PARTNERSHIP, a Delaware limited 
                                       partnership

                                       By:  Crescent Real Estate Equities, Ltd.,
                                            Sole general partner



                                       By:
                                          -------------------------------------
                                       Name:
                                            -----------------------------------
                                       Title 
                                            -----------------------------------