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SEA PINES CONDOMINIUM INVESTMENT POLICY

2/26/2006

Investment Philosophy

This Investment Policy is intended to serve as a guideline in the employment and distribution of monetary funds of Sea Pines. It is not intended to provide strict rules or methodologies for the investment of funds. Prudent judgment should always apply.

The primary objective of investing Sea Pines funds that are in excess of immediate needs is to preserve capital. Secondarily, funds should be invested to earn a reasonable return without unreasonable risk or speculation that could result in principal degradation. The liquidity and maturity of invested funds should align with the anticipated cash needs to liquidate liabilities and satisfy other approved cash distributions.

Investment Guidelines

Petty Cash

A small revolving petty cash fund (less than $500) may be maintained in the offices of the property manager to meet small and unexpected cash needs.

Operating Funds

Funds of a sufficient amount to meet the operational needs of Sea Pines for approximately one to two months should be maintained in a checking account established with a recognized FDIC commercial bank. Deposits in the account should be insured under the charter of the FDIC.

Funds intended to support expenditures that are in excess of one to two months anticipated expenditures may be invested in highly liquid low-risk investments, such as money market funds or short-term certificates of deposit. These investments should earn as high a rate of current income as is consistent with preservation of capital and maintenance of liquidity guidelines. These money market funds or similar investments should maintain very high credit quality by investing in instruments such as certificates of deposits, commercial paper, U.S. government debt and repurchase agreements and corporate obligations of investment grade. Funds in which investments are made should have net assets equivalent to at least $500,000,000 and have annual expense ratios (or equivalent fees) no higher than 0.50% of net assets.

When Reserve Funds are transferred to the operating funds for intended expenditure, the operating funds investment guidelines then apply.

Reserve Funds

Assets supporting the reserve fund process should be invested in a manner to align the intended expenditures/liabilities and maturity/liquidity of the investments. Short-term funds may be invested in money market funds, certificates of deposit or other instruments with similar risk/return/liquidity characteristics. A portion of amounts in excess of four months anticipated Reserve Funds needs may be invested to yield a higher level of return than short-term investments, without significantly increasing risk, in such a manner to match the investments’ liquidity with the anticipated needs. Up to, but no more than 20% of Reserve Funds may be invested in a combination of stock index funds and other broad based instruments with similar characteristics. No more than 20% of Reserve Funds may be in instruments that result in stock market exposure. Investments should not be made in single-issue corporate or municipal bonds except for those 100% backed by the US Government. No foreign investments should be made.

Any mutual fund investments made should be made in recognized funds that are licensed by regulatory bodies that are subject to the rules of the SEC, have net assets of at least $500,000,000 and expense ratios of no more than 0.50% of net assets. No more than $200,000 should be placed in any one fund or investment.