ACQUISITION FORM: VERSION 1.0

PURCHASE AND SALE AGREEMENT

AND ESCROW INSTRUCTIONS

_______________________________________,

A ______________________________

“SELLER”

________________________________________,

A _______________________________

“BUYER”

________________ GOLF CLUB

SDCA_1384546.1 Foley & Lardner LLP

ACQUISITION FORM: VERSION 1.0

TABLE OF CONTENTS

Article Page

1 CERTAIN DEFINITIONS ............................................................................................. 1 2 PURCHASE, PURCHASE PRICE AND PAYMENT .................................................. 5 3 ESCROW ........................................................................................................................ 7 4 INVESTIGATION PERIOD; VOLUNTARY TERMINATION; TITLE ..................... 8 5 SELLER’S COVENANTS ............................................................................................. 11 6 SELLER’S DELIVERIES .............................................................................................. 13 7 BUYER’S DELIVERIES ............................................................................................... 14 8 CONDITIONS TO CLOSING, CLOSING; AND TERMINATION UPON DEFAULT ................................................................................................................................................15 9 REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER ...............19 10 REPRESENTATIONS, WARRANTIES AND COVENANTS OF BUYER ............... 27 11 COSTS, EXPENSES AND PRORATIONS ................................................................. 27 12 ACTIONS TO BE TAKEN AT THE CLOSING .......................................................... 29 13 ADDITIONAL OBLIGATIONS OF SELLER ............................................................. 30 14 INDEMNIFICATION .................................................................................................... 31 15 RESERVED ................................................................................................................... 32 16 BROKERS ..................................................................................................................... 32 17 MISCELLANEOUS ...................................................................................................... 32 EXHIBITS

A Legal Description of the Land B Seller’s Deed C Bill of Sale D Escrow Agent’s General Provisions E Assignment of Trade Names and Trademarks F Assignment and Assumption of Contracts G Assignment of Permits, Intangibles and Entitlements H Certificate of Non-Foreign Status I List of Due Diligence Materials J Assignment and Assumption of Membership Program, Memberships and Membership Agreements K Assignment of Water Rights [and Water Contracts] L [Alternative: Interim Food & Beverage Management Agreement] SCHEDULES

2.1.2 Personal Property 2.1.4 Permits 2.1.5 Intangibles 2.1.6 Entitlements 2.1.7 Trade Names and Trademarks

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ACQUISITION FORM: VERSION 1.0

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9.9 Insurance 9.10 Memberships 9.11 Gratuities 9.17 Employee List 9.17.3 Employee Benefit Plans 9.19 TBSE 11.2 Prorations

FINAL

PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS

TO: _______________________ (“Escrow Agent”)

_______________________ _______________________ Escrow No. _____________ (“Escrow”) Escrow/Title Officer: _________ Tel: (___) _______________

Fax: (___) _______________

THIS PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS (“Agreement”) is made and dated for reference purposes as of the ___ day of __________ 20___ (the “Effective Date”), by and between _________________, a _____________ (“Seller”), and _________________, a ____________, or its assignee (“Buyer”), each of whom shall sometimes separately be referred to herein as a “Party” and both of whom shall sometimes collectively be referred to herein as the “Parties,” and constitutes: (a) a binding purchase and sale agreement between Seller and Buyer; and (b) escrow instructions to Escrow Agent whose consent appears at the end of this Agreement.

FOR VALUABLE CONSIDERATION RECEIVED, the Parties mutually agree as follows:

ARTICLE 1 CERTAIN DEFINITIONS

In addition to those terms defined elsewhere in this Agreement, the following terms have the meanings set forth below:

“ALTA Survey” shall have the meaning given such term in Section 4.1.2 hereof.

“Agreement” shall mean this Purchase and Sale Agreement and Escrow Instructions dated as of the ___ day of __________, 20__, by and between Seller and Buyer, together with all Exhibits and Schedules attached hereto.

“Asserted Liability” shall have the meaning given to such term in Section 13.2.1 hereof.

“Assignment and Assumption of Contracts” means the Assignment of Contracts, in the form of Exhibit ”F” attached hereto and incorporated herein by reference.

“Assignment and Assumption of Membership Program, Memberships and Membership Agreements” means the Assignment and Assumption of Membership Program, Memberships and Memberships Agreements, in the form of Exhibit ”J” attached hereto and incorporated herein by reference.

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“Assignment of Trade Names and Trademarks” means the Assignment and License of Trade Names and Trademarks, in the form of Exhibit “E” attached hereto and incorporated herein by reference.

“Assignment of Permits, Intangibles and Entitlements” means the Assignment of Permits, Intangibles and Entitlements, in the form of Exhibit “G” attached hereto and incorporated herein by reference.

“Assignment of Water Rights [and Water Contracts]” means the Assignment of Water Rights [and Water Contracts], in the form of Exhibit “K” attached hereto and incorporated herein by reference.

“Assumed Contracts” shall have the meaning given to such term in Section 2.1.3 hereof.

“Bill of Sale” means the Bill of Sale, in the form of Exhibit “C” attached hereto and incorporated herein by reference.

“Books and Records” shall have the meaning given to such term in Section 2.1.8 hereof.

“Buildings” means the Clubhouse, the Cart Barn and the Maintenance Facility.

“Business Day” means any day other than a Saturday, Sunday or any United States federal legal holiday.

“Buyer” means _________________, a ______________, or its permitted assignee.

“Buyer’s Affiliate” shall have the meaning given to such term in Section 15.1 hereof.

“Buyer’s Broker” means __________________________.

“Buyer’s Broker’s Commission” shall have the meaning given to such term in Section 14.1 hereof.

“Buyer’s Election Not to Terminate” shall have the meaning given to such term in Section 4.3 hereof.

“Buyer’s Election to Terminate” shall have the meaning given to such term in Section 4.2 hereof.

“Buyer’s Exchange” shall have the meaning given to such term in Section 15.13 hereof.

“Buyer Indemnified Parties” shall have the meaning given to such term in Section 9.17.1 hereof.

“Calendar Day” means any day of the week including a Business Day.

“Cart Barn” means the cart barn and related improvements located on the Land.

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“Cash” means legal tender of the United States of America represented by either: (a) currency; or (b) immediately available funds wire transferred or otherwise deposited into the designated recipient’s account pursuant to wiring instructions provided at such recipient’s direction.

“Certificate of Non-Foreign Status” means a certificate in the form of Exhibit “H” attached hereto and incorporated herein by reference.

“Claims” shall have the meaning given to such term in Section 9.17.1 hereof.

“Closing” means the consummation of the purchase and sale of the Property hereunder and the recordation of Seller’s Deed in the Official Records of ___________ County, State of ____________.

“Closing Date” means _____________, 20___ (or, if applicable, such other date mutually agreed to in writing by the Parties).

“Closing Deposit” shall have the meaning given to such term in Section 2.2.3 hereof.

“Club” means ___________ Golf Club which currently operates the Club Facilities located on the Land.

“Clubhouse” means the clubhouse and related improvements located on the Land.

“Club Facilities” means the Golf Course, the Clubhouse, the Cart Barn and the Maintenance Facility.

“Code” shall mean the Internal Revenue Code of 1986, as amended, or corresponding provisions of subsequent federal revenues laws.

“Contracts” shall mean all written or oral: (i) insurance, management, leasing, service, maintenance, operating, repair, collective bargaining, employment, employee benefit, severance, franchise, licensing, supply, purchase, consulting, professional service, advertising, promotion, public relations and other contracts and commitments in any way relating to the Property or any part thereof, together with all supplements, amendments and modifications thereto; and (ii) equipment leases and all rights and options of Seller thereunder, including rights to renew or extend the term or purchase the leased equipment and relating to equipment or property located in or upon the Real Property or used in connection therewith, together with all supplements, amendments and modifications thereto. The term “Contracts” shall specifically exclude the Membership Agreements [and the Water Contracts].

“Delinquent Revenues” shall have the meaning given to such term in Section 11.2.10 hereof.

“Deposit” shall mean the Initial Deposit and the Second Deposit, as applicable.

[Optional: “Designated Representatives” shall have the meaning given to such term in Article 9 hereof.]

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“Disapproved New UCC Exceptions” shall have the meaning given to such term in Section 4.1.5 hereof.

“Disapproved New UCC Exceptions Notice” shall have the meaning given to such term in Section 4.1.5 hereof.

“Disapproved Title Exceptions” shall have the meaning given to such term in Section 4.1.2 hereof.

“Disapproved Title Exceptions Cure Notice” shall have the meaning given to such term in Section 4.1.2 hereof.

“Disapproved Title Exceptions Cure Deadline” shall have the meaning given to such term in Section 4.1.2 hereof.

“Disapproved Title Exceptions Notice” shall have the meaning given to such term in Section 4.1.2 hereof.

“Disapproved UCC Exceptions” shall have the meaning given to such term in Section 4.1.5 hereof.

“Disapproved UCC Exceptions Notice” shall have the meaning given to such term in Section 4.1.5 hereof.

“Due Diligence Materials” shall mean all of the documents, agreements, studies, reports, maps, surveys, plans and specifications, and other materials listed on Exhibit “I” attached hereto and incorporated herein by reference [Optional: to the extent in Seller’s or Manager’s possession and/or control.]

“Effective Date” shall have the meaning given to such term in the Preamble of this Agreement.

“Employee Plan” shall have the meaning given to such term in Section 9.17.3 hereof

“Entitlements” shall have the meaning given to such term in Section 2.1.6 hereof.

“Environmental Investigation” shall have the meaning given to such term in Section 4.1.1 hereof.

“Environmental Laws” means all present and future federal, state or local laws, ordinances, codes, statutes, regulations, administrative rules, policies and orders, and other authorities, which relate to the environment and/or which classify, regulate, impose liability, obligations, restrictions on ownership, occupancy, transferability or use of the Real Property, and/or list or define hazardous substances, materials, wastes, contaminants, pollutants and/or the Hazardous Materials including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C Section 9601, et seq., as now or hereinafter amended (“CERCLA”), the Resources Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., as now or hereafter amended, the Hazardous Materials Transportation Act, 49 U.S.C.

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Section 1801, et seq., as now or hereafter amended, the Clean Water Act, 33 U.S.C. Section 1251, et seq., as now or hereafter amended, the Clear Air Act, 42 U.S.C. Section 7901, et seq., as now or hereafter amended, the Toxic Substance Control Act, 15 U.S.C. Sections 2601 through 2629, as now or hereafter amended, the Public Health Service Act, 42 U.S.C. Sections 300f through 300j, as now or hereafter amended, and any similar federal, state or local laws and ordinances and the regulations now or hereafter adopted, published and/or promulgated pursuant thereto and other state and federal laws relating to industrial hygiene, environmental protection or the use, analysis, generation, manufacture, storage, disposal or transportation of any Hazardous Materials.

“ERISA” shall have the meaning given to such term in Section 9.17.3 hereof.

“ERISA Affiliate” shall have the meaning given to such term in Section 9.17.3 hereof.

“Escrow Agent” shall mean ____________________, located at ____________; Attention: ________; Phone (____) _________; Facsimile: (___) ________; Email __________.

“Escrow Opening Date” shall have the meaning given such term in Article 3 hereof.

“Final Accounting” shall have the meaning given such term in Section 11.4 hereof.

“General Provisions” shall have the meaning given such term in Article 3 hereof.

“Golf Course” means collectively the 18-hole championship golf course, the driving range, the practice facilities, and related improvements located on the Land.

“Gratuities” shall have the meaning given to such terms in Section 9.11 hereof.

“Hazardous Materials” means, in the broadest and most comprehensive sense, all hazardous wastes, toxic substances, pollutants, contaminants, radioactive materials, flammable explosives, other such materials, including without limitation substances defined as “hazardous substances,” “hazardous materials,” “toxic substances,” “toxic pollutants,” or “infectious waste” in any applicable laws or regulations including, without limitation, the Environmental Laws, and any material present on the Real Property that has been shown to have significant adverse effects on human health including, without limitation, asbestos, polychlorinated biphenyls (PBCs), urea formaldehyde foam insulation, petroleum products (including any products or by-products therefrom), lead-based paints, and any material containing or constituting any of the foregoing, and any such other substances, materials and wastes which are or become regulated by reason of actual or threatened risk of toxicity causing injury or illness, under any Environmental Laws or other applicable federal, state or local law, statute, ordinance or regulations, or which are classified as hazardous or toxic under current or future federal, state or local laws or regulations.

“Improvements” means all buildings, structures, fixtures and other improvements now or hereafter located on, over and under the Land including, without limitation, the Clubhouse, the Golf Course, the Cart Barn, and the Maintenance Facility, all irrigation and water control systems, utility lines and related fixtures and improvements, drainage facilities, landscaping, improvements, common areas, fencing, signs, cart paths, restrooms, drinking fountains, roadways, walkways and parking facilities.

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“Indemnifying Party” shall have the meaning given to such term in Section 13.2.1 hereof.

“Indemnitee” shall have the meaning given to such term in Section 13.1 hereof.

“Initial Deposit” shall have the meaning given such term in Section 2.2.1 hereof.

“Intangibles” shall have the meaning given such to term in Section 2.1.5 hereof.

[Alternative: “Interim Food & Beverage Management Agreement” means the Interim Food & Beverage Management Agreement, in the form of Exhibit “L” attached hereto and incorporated herein by reference.]

“Investigation Period” shall have the meaning given to such term in Section 4.1 hereof.

“Land” means that certain tract or parcel or those certain tracts or parcels of real property consisting of approximately _______ acres, located in the City of ____________, County of ______________, State of ____________, the description of which is set forth on Exhibit “A” attached hereto and incorporated herein by reference.

“Liquor License” means the license(s) held by Seller and currently in use at the Club Facilities allowing for the sale of alcoholic beverages.

“Losses” shall have the meaning given to such term in Section 13.1 hereof.

“Maintenance Facility” means the maintenance facility, storage area and related facilities located on the Land.

“Management Agreement” means that certain Management Agreement, dated _______________, by and between Seller and Manager, as amended.

“Manager” shall mean ____________________.

“Material Loss” means damage, loss or destruction to any portion of the Real Property, the loss of which is equal or greater than _____________ Dollars ($__________) (measured by the cost of repair or replacement).

“Member” means any person or entity who holds a Membership in the Club as of the Closing.

“Membership” means any membership or other right, license or privilege which authorizes the holder to utilize all or any portion of the Club Facilities.

“Membership Agreements” means: (a) the Membership Plan [Bylaws], Rules and Regulations and other governing instruments, policies and procedures of the Club, as the same may be modified and amended from time to time; and (b) any contract, agreement or other written or oral understanding entered into in connection with the offer, sale and/or issuance of a Membership in the Club.

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“Membership Deposits” shall collectively refer to all of the refundable membership deposits received by Seller prior to Closing pursuant to the terms and conditions of the Membership Agreement.

“Membership Program” shall have the meaning given such term in Section 5.3.1(b) hereof.

“Monetary Obligations” shall mean any and all liens, security interests and encumbrances against the Real Property evidencing a monetary obligation which can be removed by the payment of money, including, without limitation, delinquent real property taxes, deeds of trust, mortgages, mechanic’s liens, attachment liens, execution liens, tax liens and judgment liens.

“New Title Exceptions” shall have the meaning given to such term in Section 4.1.2 hereof.

“New UCC Exceptions” shall have the meaning given to such term in Section 4.1.5.

“Non-Material Loss” means damage, loss or destruction to any portion of the Real Property, the loss of which is less than ____________ Dollars ($_____________) (measured by the cost of repair or replacement).

“OFAC” shall have the meaning given to such term in Section 9.21 hereof.

“Notice” shall have the meaning given to such term in Section 15.2 hereof.

“Permits” shall have the meaning given to such term in Section 2.1.4 hereof.

“Permitted Title Exceptions” shall have the meaning given to such term in Section 4.1.2 hereof.

“Permitted UCC Exceptions” shall have the meaning given to such term in Section 4.1.5 hereof.

“Personal Property” shall have the meaning given to such term in Section 2.1.2 hereof.

“Pesticides” means any herbicide, insecticide, fungicide or rodenticide, the manufacture, labeling, sale, distribution or use of which is regulated by state or federal law, including, but not limited to, the Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C. 135, et seq.), as now or hereafter amended, and the Federal Pesticide Acts of 1972 and 1978 (7 U.S.C. 136, et seq.), as now or hereafter amended.

“Phase 1 Report” shall have the meaning given to such term in Section 4.1 hereof.

“Preliminary Title Report” shall have the meaning given such term in Section 4.1.2 hereof.

“Property” shall have the meaning given to such term in Section 2.1 hereof.

“PST” shall mean Pacific Standard Time.

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“Purchase Price” shall have the meaning given to such term in Section 2.2 hereof.

“Real Property” shall have the meaning given to such term in Section 2.1.1 hereof.

“Seller” means __________________, a ________________.

“Seller’s Broker” shall mean _______________.

“Seller’s Broker’s Commission” shall have the meaning given to such term in Section 14.1 hereof.

“Seller’s Deed” means the [Special] Warranty Deed to be executed and acknowledged by Seller and delivered to Buyer on or before the Closing, in the form of Exhibit “B” attached hereto and incorporated herein by reference.

“Seller’s Exchange” shall have the meaning given to such term in Section 15.12 hereof.

“Term Memberships” shall have the meaning given to such term in Section 11.2.6 hereof.

“TBSE” means all tournaments, banquets and other special events to be held at the Club subsequent to the Closing, as set forth on Schedule 1.0 attached hereto and incorporated herein by reference.

“Title Insurer” shall mean ____________________, located at ____________; Attention: ________; Phone (____) _________; Facsimile: (___) ________; Email __________.

“Title Policy” shall have the meaning given to such term in Section 8.1.6 hereof.

“Trade Names and Trademarks” shall have the meaning given to such term in Section 2.1.7 hereof.

“Transaction Documents” means Seller’s Deed, the Bill of Sale, the Assignment and Assumption of Contracts, the Assignment of Permits, Intangibles and Entitlements, the Assignment and License of Trade Names and Trademarks, the Assignment of Water Rights [and Water Contracts], the Assignment and Assumption of Membership Program, Memberships and Membership Agreements, [Alternative: the Interim Food & Beverage Management Agreement] and all other instruments or agreements to be executed and delivered pursuant to this Agreement or any of the foregoing.

“Transition Letter” shall have the meaning given such term in Section 5.3.1 hereof.

“UCC Cure Deadline” shall have the meaning given to such term in Section 4.1.5 hereof.

“UCC Searches” shall have the meaning given to such term in Section 4.1.5 hereof.

[Optional: “Water Contract[s]” means ______________________.]

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ARTICLE 2 PURCHASE, PURCHASE PRICE AND PAYMENT

2.1 Purchase and Sale of Property. Subject to the terms and conditions set forth in this Agreement, Seller shall sell, convey, assign, transfer and deliver to Buyer, and Buyer shall purchase, acquire and assume from Seller, the following property (collectively, the “Property”):

2.1.1 Real Property. The Land and the Improvements together with (a) all easements, rights-of-way, development rights, entitlements, air rights and appurtenances relating or appertaining to the Land and/or the Improvements, (b) all water wells, streams, creeks, ponds, lakes or other bodies of water in, on or under the Land, whether such rights are riparian, appropriate, prescriptive or otherwise, and all water rights, water allocations and water stock, (c) all sewer, septic and waste disposal rights and interests applicable or appurtenant to and/or used in connection with the operation of the Improvements, and (d) all minerals, oil, gas and other hydrocarbons located in, on or under the Land, together with all rights to surface or subsurface entry, free and clear of any and all liens, liabilities, encumbrances, exceptions and claims, other than the Permitted Title Exceptions (collectively the “Real Property”).

2.1.2 Personal Property. All equipment, machinery, tools, appliances, furnishings, furniture, fixtures, trade fixtures, goods held for resale, pro shop inventory, food and beverage inventory, fertilizer and pesticide inventory, supplies, telephone and computer equipment and other items of tangible personal property located on the Land, in the Improvements, or used in connection with the business of owning, operating, maintaining and/or managing the Real Property, including, without limitation, those items set forth on Schedule 2.1.2, attached hereto and incorporated herein by reference, which Personal Property shall be free and clear of any and all liens, liabilities, encumbrances and claims, other than the Assumed Contracts(collectively the “Personal Property”).

2.1.3 Assumed Contracts. All of Seller’s right, title and interest in, to and under those Contracts relating to the operation, maintenance and/or management of the Property which Buyer expressly agrees to assume in writing pursuant to a written notice by Buyer delivered to Seller prior to the expiration of the Investigation Period (collectively the “Assumed Contracts”).

2.1.4 Permits. All of Seller’s right, title and interest in, to and under all permits, licenses (excluding the Liquor License) [Alternative: (including the Liquor License)], certificates of occupancy, approvals, authorizations and orders obtained from any governmental authority and relating to the Property or the business of owning, operating, maintaining and/or managing the Property, including, without limitation, those items set forth on Schedule 2.1.4, attached hereto and incorporated herein by reference (collectively the “Permits”).

2.1.5 Intangibles. All intangible personal property not otherwise described in this Section 2.1 and relating to the Property or the business of owning, operating, maintaining and/or managing the Property including, without limitation: (a) all warranties in favor of Seller and/or Manager with respect to the Property; (b) all liens and security interests in favor of Seller, together with any instruments or documents evidencing same; (c) the telephone numbers, facsimile numbers, domain names and any e-mail addresses and metatag rights relating to such domain names for the Club; (d) all goodwill relating to the business of owning, operating,

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maintaining and managing the Property; (e) all advertising campaigns and marketing or promotional materials relating to the Club Facilities; (f) all artwork, photographs and other intellectual property utilized in conjunction with the ownership, operation and/or management of the Club Facilities; (g) all internet sites relating to the Property; (h) all those items set forth on Schedule 2.1.5, attached hereto and incorporated herein; and (i) all changes, additions, substitutions and replacements for any of the foregoing (collectively, the “Intangibles”).

2.1.6 Entitlements. All of Seller’s right, title and interest in, to and under all land use entitlements, development rights, water allocations, water rights, sewer capacity, density allocations and other rights or approvals relating to or authorizing the ownership, development and/or operation of the Real Property; all plans and specifications, all contract rights (including any and all guarantees and warranties relating to the construction of any Improvements); all development and land use rights, applications, architectural and engineering plans and reports, specifications and drawings, as-built drawings, maps; all items constituting the Due Diligence Materials; and any documents of the same or similar nature pertaining to the Real Property including, without limitation, those items set forth on Schedule 2.1.6, attached hereto and incorporated herein by reference; and all changes, additions, substitutions and replacements for any of the foregoing (collectively the “Entitlements”).

2.1.7 Trade Names and Trademarks. Any and all rights of Seller in and to the trade name “____________________” and any and all derivatives and forms thereof, together with all trademarks, service marks and logos of “__________________,” whether or not registered, and all trademarks, service marks, logos, fictitious business names and other intellectual property registrations or filings with regard to the foregoing, including, without limitation, those trademarks, service marks and logos set forth on Schedule 2.1.7, attached hereto and incorporated herein by reference (collectively, the “Trade Names and Trademarks”).

2.1.8 Books and Records. All books and records relating to the business of owning, operating, maintaining and/or managing the Real Property, including without limitation all accounting, financial, tax, employment, sales and other records (collectively the “Books and Records”).

2.1.9 Memberships and Membership Agreements. The Membership Program, including, without limitation: (a) the Memberships; and (b) the Membership Agreements; provided, Buyer shall not assume any liability with respect to the Membership Program to the extent such liability accrued or relates to the period of time prior to Closing.

2.2 Purchase Price. The purchase price for the Property (“Purchase Price”) shall be _____________________________________ Dollars ($____________). The Purchase Price shall be paid by Buyer to Seller as follows:

2.2.1 Initial Deposit. Within two (2) Business Days following the Effective Date, Buyer shall deposit into Escrow the sum of _______________ Dollars ($__________), in the form of Cash, which amount shall serve as an earnest money deposit (“Initial Deposit”). Subject to the applicable termination and default provisions contained in this Agreement: (a) the Initial Deposit shall be applied as a credit towards the payment of the Purchase Price; and (b) all interest accrued on the Initial Deposit while in Escrow Agent’s possession shall belong to Buyer.

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2.2.2 Second Deposit. In the event Buyer timely delivers to Seller Buyer’s Election Not to Terminate this Agreement pursuant to Section 4.3 hereof, Buyer shall deposit with Escrow Holder an additional deposit in the sum of ________________ Dollars ($___________) (the “Second Deposit”), in the form of Cash, within two (2) Business Days after Buyer delivers to Seller Buyer’s Election Not to Terminate pursuant to Section 4.3 hereof. Buyer may direct Escrow Agent to invest the Second Deposit in one or more interest bearing accounts designated by Buyer and approved by Escrow Agent. Subject to the applicable termination and default provisions contained in this Agreement: (i) the Second Deposit shall remain in Escrow prior to the Closing; (ii) upon the Closing, the Second Deposit shall be applied as a credit towards the payment of the Purchase Price; and (iii) all interest that accrues on the Second Deposit while in Escrow Agent’s control shall belong to Buyer. The Initial Deposit and Second Deposit are collectively referred to herein as the “Deposit.” All references in this Agreement to the “Deposit” shall mean the Deposit any and all interest that accrues thereon while in Escrow Agent’s control. In the event Buyer fails to timely deposit the Second Deposit as required hereunder, then Buyer shall be in default hereunder and Seller may, in Seller’s sole and absolute discretion, terminate this Agreement in accordance with the provisions of Section 8.6.2 hereof.

2.2.3 Closing Deposit. The balance of the Purchase Price shall be paid by Buyer to Escrow Agent and distributed by Escrow Agent to Seller on the Closing, in the form of Cash, in accordance with the terms and conditions set forth in this Agreement (the “Closing Deposit”).

2.3 Allocation. Prior to the Closing, if applicable, Buyer and Seller shall agree on an allocation of the Purchase Price for the Property. All allocations pursuant to this Section 2.3 shall be made in accordance with Section 1060 of the Code, and Buyer and Seller agree to file their respective tax returns and reports (federal, state, local and foreign) consistent therewith in all respects.

ARTICLE 3 ESCROW

Seller and Buyer shall open the Escrow with Escrow Agent within two (2) Business Days following the date of Seller’s and Buyer’s execution of this Agreement by depositing with Escrow Agent a fully executed counterpart original of this Agreement. The date of such delivery shall constitute the “Escrow Opening Date,” and upon such delivery, this Agreement shall constitute joint escrow instructions to Escrow Agent, which joint escrow instructions shall supersede all prior escrow instructions related to the Escrow, if any. Escrow Agent’s General Provisions, which are attached as Exhibit “D” to this Agreement (“General Provisions”), are hereby incorporated in and made a part of this Agreement, and Seller and Buyer hereby expressly agree to the General Provisions. Additionally, Seller and Buyer hereby agree to promptly execute and deliver to Escrow Agent any additional or supplementary escrow instructions as may be necessary or convenient to consummate the transactions contemplated by this Agreement provided, however, that such instructions shall not supersede this Agreement, and in all cases this Agreement shall control unless such instructions expressly provide otherwise.

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ARTICLE 4 INVESTIGATION PERIOD; VOLUNTARY TERMINATION; TITLE

4.1 Investigation Period; Seller’s Deliveries. During the time period commencing upon the Effective Date and terminating at 11:59 p.m. PST on ____________, 20__ [Alternative: the date that is thirty (30) Calendar Days following the date Buyer has received the last of the following: (i) all of the Due Diligence Materials (ii) the Preliminary Title Report; (iii) the ALTA Survey; and (iv) the Phase I Report, as applicable] (the “Investigation Period”), Buyer shall have the right to conduct and complete an investigation of all matters pertaining to the Property and Buyer’s purchase thereof including, without limitation, the matters described in this Section 4.1.

4.1.1 Physical and Geological Inspection. Without limiting the provisions of Article 5 hereof and this Section 4.1, but subject to the limitations set forth in this Section 4.1.1, during the Investigation Period, Buyer shall have the right, at Buyer’s expense, to make inspections (including tests, surveys and other studies) of the Real Property and all matters relating thereto, including, but not limited to, soils and geologic conditions, location of property lines, water/utility availability and use restrictions, environmental conditions, the manner or quality of the construction of the Improvements, the habitability, merchantability, marketability, profitability or fitness for a particular purpose of the Real Property, the effect of applicable planning, zoning and subdivision statutes, ordinances, regulations, restrictions and permits, the character and amount of any fees or charges that must be paid to further develop, improve and/or occupy the Real Property, the feasibility and approval of any other improvements Buyer desires to construct on the Real Property, and all other matters relating to the Real Property. During the Investigation Period, Buyer and its agents, contractors and subcontractors (collectively, “Buyer’s Consultants”) shall have the right to enter upon the Real Property, at reasonable times during ordinary business hours to make any and all inspections and tests as Buyer deems desirable and which may be accomplished without causing any material alteration or damage to the Real Property in connection with such inspections or tests. Buyer may cause an environmental consultant to prepare and deliver to Buyer a current Phase 1 Environmental Investigation Report covering the Real Property (“Phase 1 Report”). In connection with the foregoing, during the Investigation Period, Buyer shall be entitled to review such Phase 1 Report and conduct, through its environmental auditor, one or more supplemental environmental investigations of the Real Property (“Environmental Investigation”), subject to the provisions of this Agreement. All such costs, fees and expenses associated with such Environmental Investigation, shall be borne by Buyer. Buyer shall not materially interfere with any rights of any occupant or invitee or with the on-going operations of the Real Property in making any such inspections or tests, and shall return and restore the Real Property to substantially its original condition prior to such inspections or tests. In the event Buyer disapproves or finds unacceptable, in Buyer’s sole and absolute discretion, any matters reviewed by Buyer during the Investigation Period, Buyer may elect to terminate this Agreement and the Escrow pursuant to the provisions of Section 4.2 hereof.

[Optional: Notwithstanding any term or provision in this Agreement to the contrary, in no event shall Buyer or Buyer’s Consultants conduct any invasive testing on the Property without Seller’s prior written approval, which approval shall not be unreasonably withheld, conditioned or delayed. Buyer shall not permit any liens or encumbrances to be placed against the Property in connection with Buyer’s investigation and inspection of the Property and/or in connection with

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Buyer’s activities on the Property. Buyer hereby agrees to indemnify and hold harmless Seller from and against any claims, demands and causes of action for personal injury or property damage resulting from the exercise of the right of inspection granted to Buyer under this Section 4.1.1, provided, however, such indemnification obligations shall exclude any claim, costs, expenses and liabilities arising out of (i) the discovery of, or the accidental or inadvertent release of any Hazardous Materials resulting from such investigations, which substances were in, on, or under the Property prior to such investigations; or (ii) the negligence or intentional misconduct of Seller or Manager or their respective agents, employees, consultants or representatives.]

4.1.2 Preliminary Title Report/ALTA Survey. Within ten (10) Calendar Days following the Effective Date, Seller shall obtain and deliver (or cause to be delivered) to Buyer: (i) a current preliminary title report covering the Real Property, together with copies of all documents referred to as exceptions therein (collectively the “Preliminary Title Report”), prepared and issued by Title Insurer; and (ii) a current ALTA survey of the Real Property, which survey shall be prepared in accordance with the standards of Buyer by a surveyor licensed under the laws of the State in which the Real Property is located (“ALTA Survey”). Not later than the expiration of the Investigation Period, Buyer shall notify Seller in writing (the “Disapproved Title Exceptions Notice”) of Buyer’s disapproval of any matters set forth in the Preliminary Title Report and/or the ALTA Survey (collectively, the “Disapproved Title Exceptions”). Not later than three (3) Business Days after Seller receives Buyer’s Disapproved Title Exceptions Notice (the “Disapproved Title Exceptions Cure Notice Deadline”), Seller shall give Buyer written notice specifying whether or not Seller will cure one or more of the Disapproved Title Exceptions (the “Disapproved Title Exceptions Cure Notice”). In the event Seller fails to timely deliver written notice to Buyer specifying whether or not Seller will cure one or more of the Disapproved Title Exceptions, Seller shall be deemed to have elected not to cure any of the Disapproved Title Exceptions. If Seller elects (or is deemed to have elected) not to cure one or more of the Disapproved Title Exceptions, then, as Buyer’s sole remedy, Buyer may, within three (3) Business Days following the Disapproved Title Exceptions Cure Notice Deadline, elect to either: (a) continue this Agreement in effect without modification and purchase and acquire the Property in accordance with the terms and conditions of this Agreement, subject to such Disapproved Title Exceptions which Seller has elected (or is deemed to have elected) not to cure (which will be deemed to constitute “Permitted Title Exceptions”); or (b) to terminate this Agreement and the Escrow pursuant to Section 4.2 hereof and receive a return of the Initial Deposit. In the event Buyer fails to timely deliver written notice to Seller specifying whether or not Buyer elects to terminate this Agreement, Buyer shall be deemed to have elected to terminate this Agreement and the Escrow pursuant to Section 4.2 hereof, shall be entitled to receive a return of the Initial Deposit pursuant to such Section and neither party shall have any further duties, obligations or rights hereunder other than those which expressly survive termination hereof.

In the event Seller timely elects to cure one or more of the Disapproved Title Exceptions Notice, Seller shall have until the last Business Day immediately preceding the Closing Date to cure the applicable Disapproved Title Exceptions. A Disapproved Title Exception shall be deemed to have been cured if Seller causes such item to be removed from record title to the Real Property prior to the Closing. In the event Seller fails to timely cure any Disapproved Title Exception that Seller has elected to cure on or before the Closing, then as of the Closing Date, Buyer shall elect to either: (1) continue this Agreement in effect without modification and

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purchase and acquire the Property in accordance with the terms and conditions of this Agreement, subject to such Disapproved Title Exceptions (which will be deemed to constitute “Permitted Title Exceptions”), or (2) terminate this Agreement and the Escrow pursuant to Section 8.5, unless such Disapproved Title Exceptions are the result of a breach by Seller of the covenants set forth in Sections 5.13 and/or 5.14, in which case the provisions of Section 8.6.1 shall govern.

Fee title to the Land and the Improvements shall be conveyed by Seller to Buyer subject only to the following exceptions to title (“Permitted Title Exceptions”):

(a) Non-delinquent real and personal property taxes and assessments;

(b) Any lien voluntarily imposed by Buyer; and

(c) Any matters set forth in the Preliminary Title Report and/or the ALTA Survey that are approved (or deemed approved) by Buyer in accordance with the procedures and within the time period set forth in this Section 4.1.2.

In the event that prior to the Closing, any new title exceptions regarding the Real Property are discovered or revealed, which new title exceptions were not otherwise set forth or referred to in the Preliminary Title Report and/or the ALTA Survey (“New Title Exceptions”), Seller shall immediately deliver written notice to Buyer and Escrow Agent disclosing the existence of such New Title Exceptions, together with copies of all underlying documents (the “New Title Exceptions Notice”). Not later than five (5) Calendar Days after the date of Buyer’s receipt of the New Title Exceptions Notice, Buyer shall notify Seller in writing (the “Disapproved New Title Exceptions Notice”) of Buyer’s disapproval or approval of any New Title Exceptions set forth in the New Title Exceptions Notice. The Disapproved New Title Exceptions Notice shall list each item of dissatisfaction or objection in particular (each, a “Disapproved New Title Exception”). In the event Buyer fails to deliver a Disapproved New Title Exceptions Notice, then Buyer shall be deemed to have approved such New Title Exceptions (in which case such New Title Exceptions shall be deemed to constitute “Permitted Title Exceptions”). In the event Seller timely receives a Disapproved New Title Exceptions Notice from Buyer, Seller shall not be required to cause any of the Disapproved New Title Exceptions to be cured on or before the Closing, except to the extent such Disapproved New Title Exceptions are Monetary Obligations which the Seller is obligated to pay and satisfy in full prior to Closing. Notwithstanding the foregoing, Seller shall have the right, but not the obligation, to elect to cure one or more of the Disapproved New Title Exceptions by delivering written notice (the “Disapproved New Title Exceptions Cure Notice”) to Buyer within five (5) Business Days (but in no event later than the Closing Date) following Seller’s receipt of Buyer’s Disapproved New Title Exceptions Notice (the “Cure Election Deadline”). If Seller fails to timely deliver a Disapproved New Title Exceptions Cure Notice to Buyer, then Seller shall be deemed to have elected not to cure any of the Disapproved New Title Exceptions. In the event Seller elects (or is deemed to have elected) not to cure one or more of the Disapproved New Title Exceptions, provided such Disapproved New Title Exceptions are not Monetary Obligations which Seller is obligated to cure on or before the Closing, then within five (5) Business Days (but in no event later than the Closing Date) following the Cure Election Deadline, Buyer shall elect to either: (A) continue this Agreement in effect without modification and purchase and

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acquire the Property in accordance with the terms and conditions of this Agreement, subject to such Disapproved New Title Exceptions (which will be deemed to constitute “Permitted Title Exceptions”), or (B) terminate this Agreement and the Escrow pursuant to Section 8.5 hereof, unless such Disapproved Title Exceptions are the result of a breach by Seller of the covenants set forth in Sections 5.13 and/or 5.14, in which case the provisions of Section 8.6.1 shall govern.

In the event Seller timely elects to cure one or more of the Disapproved New Title Exceptions, Seller shall have until the last Business Day immediately preceding the Closing Date to cure the applicable Disapproved New Title Exceptions. In the event Seller fails to timely cure any Disapproved New Title Exception that Seller has elected to cure on or before the Closing, then as of the Closing Date, Buyer shall elect to either: (I) continue this Agreement in effect without modification and purchase and acquire the Property in accordance with the terms and conditions of this Agreement, subject to such Disapproved New Title Exceptions (which will be deemed to constitute “Permitted Title Exceptions”), or (II) terminate this Agreement and the Escrow pursuant to Section 8.5, unless such Disapproved New Title Exceptions are the result of a breach by Seller of the covenants set forth in Sections 5.13 and/or 5.14, in which case the provisions of Section 8.6.1 shall govern. A Disapproved New Title Exception shall be deemed to have been cured if Seller causes such item to be removed from record title to the Real Property prior to the Closing.

In the event Buyer disapproves or finds unacceptable, in Buyer’s sole and absolute discretion, any matters reviewed by Buyer during the Investigation Period pursuant to this Section 4.1.2 hereof, Buyer may elect to terminate this Agreement and the Escrow pursuant to the provisions of Section 4.2 hereof.

4.1.3 Investigation of Permits, Intangibles and Entitlements and Other Property. During the Investigation Period, Buyer shall have the right, at Buyer’s expense, to conduct and complete an investigation all matters pertaining to the Books and Records, Contracts, Trade Names and Trademarks, Permits, Intangibles and Entitlements and all other items of Property and Buyer’s acquisition thereof. In this regard, at all times prior to the Closing, Buyer shall have the right to contact governmental officials and other parties and make reasonable inquiries concerning the Permits, Intangibles and Entitlements and all other items of Property. Seller agrees to reasonably cooperate with Buyer in connection with its investigation of the Permits, Intangibles and Entitlements and all other items of Property and all other matters pertaining thereto.

In the event Buyer disapproves or finds unacceptable, in Buyer’s sole and absolute discretion, any matters reviewed by Buyer during the Investigation Period, Buyer may elect to terminate this Agreement and the Escrow pursuant to the provisions of Section 4.2 hereof.

4.1.4 Due Diligence Materials. Not later than five (5) Calendar Days after the Effective Date, Seller shall deliver, or cause to be delivered, to Buyer true, correct and complete copies of all of the Due Diligence Materials. Seller will promptly deliver to Buyer supplements and/or updates of the Due Diligence Materials to the extent such items are received by Seller prior to Closing. During the Investigation Period, Buyer shall have the right to conduct and complete an investigation of all matters pertaining to the Due Diligence Materials and all other

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matters pertaining to the Property and Buyer’s acquisition thereof. In this regard, Buyer shall have the right to contact governmental officials and other parties and make reasonable inquiries concerning the Due Diligence Materials and all other matters pertaining to the Property. Seller agrees to reasonably cooperate with Buyer in connection with its investigation of the Due Diligence Materials and all other matters pertaining to the Property.

In the event Buyer disapproves or finds unacceptable, in Buyer’s sole and absolute discretion, any matters reviewed by Buyer during the Investigation Period, Buyer may elect to terminate this Agreement and the Escrow pursuant to the provisions of Section 4.2 hereof.

4.1.5 UCC Search on Personal Property. Buyer may, at Buyer’s sole cost and expense, cause to be conducted a Uniform Commercial Code Search (collectively, the “UCC Searches”). Not later than 11:59 p.m. PST on the date which is three (3) Business Days after the Effective Date, Buyer shall notify Seller in writing (the “Disapproved UCC Exceptions Notice”) of Buyer’s disapproval of any matters set forth in the UCC Searches (“Disapproved UCC Exceptions”). Not later than 5:00 p.m. PST on the day which is five (5) Business Days after Seller receives any such objections notice from Buyer (the “UCC Cure Deadline”), Seller shall give Buyer written notice specifying whether or not Seller elects to cure any of the Disapproved UCC Exceptions (the “Disapproved UCC Exceptions Cure Notice”). In the event Seller fails to timely deliver such Disapproved UCC Exceptions Cure Notice to Buyer, Seller shall be deemed to have elected not to cure any of the Disapproved UCC Exceptions. If Seller elects (or is deemed to have elected) not to cure one or more of the Disapproved UCC Exceptions, then, as Buyer’s sole remedy, Buyer shall elect to either: (a) continue this Agreement in effect without modification and purchase and acquire the Property in accordance with the terms and conditions of this Agreement, subject to such Disapproved UCC Exceptions (which will be deemed to constitute “Permitted UCC Exceptions”), or (b) terminate this Agreement and the Escrow pursuant to Section 8.5 hereof, unless such Disapproved UCC Exceptions are the result of a breach by Seller of its obligation to cure any Monetary Obligations, in which case the provisions of Section 8.6.1 shall govern. A Disapproved UCC Exception shall be deemed to have been terminated if Seller causes the underlying obligation to be paid or satisfied and causes the applicable UCC financing statement to be terminated. All UCC exceptions which are approved (or deemed approved) by Buyer pursuant to this Section 4.1.5 shall be deemed to be “Permitted UCC Exceptions.”

Following the timely receipt of a Disapproved UCC Exceptions Notice from Buyer, if Seller timely delivers a Disapproved UCC Exceptions Cure Notice to Buyer, Seller shall have until the date that is two (2) Business Days immediately preceding the Closing Date to cure the applicable Disapproved UCC Exceptions. A Disapproved UCC Exception shall be deemed to have been terminated if Seller causes the underlying obligation to be paid or satisfied and causes the applicable UCC financing statement to be terminated. In the event Seller fails to timely cure any Disapproved UCC Exceptions that Seller has elected to cure pursuant to the Disapproved UCC Exceptions Cure Notice, then Buyer may elect to either: (y) continue this Agreement in effect without modification and purchase and acquire the Property in accordance with the terms and conditions of this Agreement, subject to the Disapproved Title Exceptions which Seller failed to timely cure (which Disapproved UCC Exceptions will be deemed to constitute “Permitted UCC Exceptions”); or (z) terminate this Agreement and the Escrow

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pursuant to Section 8.5, unless such Disapproved Title Exceptions are the result of a breach by Seller of the covenants set forth in Sections 5.13 and/or 5.14, in which case the provisions of Section 8.6.1 shall govern, by delivering written notice to Seller not later than 12:00 p.m. PST on the last Business Day immediately preceding the Closing Date.

In the event that, prior to the Closing, any new UCC exceptions are discovered or revealed, which new UCC exceptions were not otherwise set forth or referred to in the UCC Searches (“New UCC Exceptions”), Seller shall immediately deliver written notice to Buyer and Escrow Agent disclosing the existence of such New UCC Exceptions, together with copies of all underlying documents. All such New UCC Exceptions shall be deemed to be approved for purposes of this Agreement, unless Buyer gives Seller written notice of Buyer’s disapproval of such New UCC Exceptions within five (5) Calendar Days after the date of Buyer’s receipt of written notice of the existence of the New UCC Exceptions (the “Disapproved New UCC Exceptions Notice”). The Disapproved New UCC Exceptions Notice shall list each item of dissatisfaction or objection in particular (each, a “Disapproved New UCC Exception”). Seller shall not be required to cause any of the Disapproved New UCC Title Exceptions to be cured on or before the Closing. Notwithstanding the foregoing, Seller shall have the right, but not the obligation, to elect to cure one or more of the Disapproved New UCC Exceptions by delivering written notice (the “Disapproved New UCC Exceptions Cure Notice”) to Buyer within five (5) Business Days (but in no event later than the Closing Date) following Seller’s receipt of Buyer’s Disapproved New UCC Exceptions Notice (the “UCC Cure Election Deadline”). If Seller fails to timely deliver a Disapproved New UCC Exceptions Cure Notice to Buyer, then Seller shall be deemed to have elected not to cure any of the Disapproved New UCC Exceptions. In the event Seller elects (or is deemed to have elected) not to cure one or more of the Disapproved New UCC Exceptions, provided such Disapproved New UCC Exceptions are not Monetary Obligations which Seller is obligated to cure on or before the Closing, then within two (2) Business Days (but in no event later than the Closing Date) following the UCC Cure Election Deadline, Buyer shall elect to either: (i) continue this Agreement in effect without modification and purchase and acquire the Property in accordance with the terms and conditions of this Agreement, subject to such Disapproved New UCC Exceptions (which will be deemed to constitute “Permitted UCC Exceptions”), or (ii) terminate this Agreement and the Escrow pursuant to Section 8.5 hereof, unless such Disapproved New UCC Exceptions are the result of a breach by Seller of its obligation to cure any Monetary Obligations, in which case the provisions of Section 8.6.1 shall govern.

In the event Seller timely elects to cure one or more of the Disapproved New UCC Exceptions Notice, Seller shall have until the last Business Day immediately preceding the Closing Date to cure the applicable Disapproved New UCC Exceptions. In the event Seller fails to timely cure any Disapproved New UCC Exception that Seller has elected to cure on or before the Closing, provided such Disapproved New UCC Exceptions are not Monetary Obligations which Seller is obligated to cure on or before the Closing, then as of the Closing Date, Buyer shall elect to either: (A) continue this Agreement in effect without modification and purchase and acquire the Property in accordance with the terms and conditions of this Agreement, subject to such Disapproved New UCC Title Exceptions (which will be deemed to constitute “Permitted UCC Exceptions”), or (B) terminate this Agreement and the Escrow pursuant to Section 8.5 hereof, unless such Disapproved New UCC Exceptions are the result of a breach by Seller of its obligation to cure any Monetary Obligations, in which case the

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provisions of Section 8.6.1 shall govern. A Disapproved New UCC Exception shall be deemed to have been terminated if Seller causes the underlying obligation to be paid or satisfied and causes the applicable UCC financing statement to be terminated.

In the event Buyer disapproves or finds unacceptable, in Buyer’s sole and absolute discretion, any matters reviewed by Buyer during the Investigation Period pursuant to this Section 4.1.5 hereof, Buyer may elect to terminate this Agreement and the Escrow pursuant to the provisions of Section 4.2 hereof.

4.2 Election to Terminate. In the event Buyer desires to terminate this Agreement and the Escrow pursuant to the provisions of Section 4.1 above, Buyer may elect to terminate this Agreement and the Escrow as follows: (a) by giving Seller and Escrow Agent written notice of Buyer’s election to terminate not later than 11:59 p.m. PST on the date of expiration of the Investigation Period (“Buyer’s Election to Terminate”); (b) in the event Buyer has delivered to Seller a Disapproved Title Exceptions Notice prior to the expiration of the Investigation Period and Seller timely elects (or is deemed to have elected) not to cure one or more of such Disapproved Title Exceptions, then Buyer may terminate this Agreement by giving Seller written notice of Buyer’s Election to Terminate not later than three (3) Business Days following the Disapproved Title Exceptions Cure Notice Deadline; or (c) by failing to timely deliver to Seller and Escrow Agent Buyer’s Election Not to Terminate pursuant to Section 4.3 hereof, which failure shall be deemed to constitute Buyer’s election to terminate this Agreement and the Escrow pursuant to this Section 4.2.

Upon any election (including any deemed election) by Buyer to terminate this Agreement pursuant to this Section 4.2, this Agreement shall automatically terminate and Seller and Buyer shall execute such cancellation instructions as may be necessary to effectuate the cancellation of the Escrow, as may be required by Escrow Agent. Within five (5) Calendar Days following any such termination, Escrow Agent shall cause to be paid to Buyer the entire amount of the Initial Deposit, together with any accrued interest thereon, and this Agreement will automatically terminate. Any escrow cancellation, title cancellation or other cancellation costs in connection therewith shall be borne equally by Seller and Buyer.

Upon the performance by Buyer and Seller of their respective obligations pursuant to this Section 4.2 hereof, neither Seller nor Buyer shall have any further rights or obligations to each other with regard to this Agreement (unless this Agreement expressly provides otherwise).

4.3 Election Not to Terminate. In the event Buyer desires not to terminate this Agreement pursuant to Section 4.1 above, Buyer may elect not to terminate this Agreement and the Escrow as follows: (a) by giving Seller and Escrow Agent written notice of Buyer’s election not to terminate not later than 11:59 p.m. PST on the date of expiration of the Investigation Period (“Buyer’s Election Not to Terminate”); or (b) in the event Buyer has delivered to Seller a Disapproved Title Exceptions Notice prior to the expiration of the Investigation Period and Seller timely elects (or is deemed to have elected) not to cure one or more of such Disapproved Title Exceptions, then Buyer may elect not terminate this Agreement by giving Seller written notice of Buyer’s Election Not to Terminate not later than three (3) Business Days following the Disapproved Title Exceptions Cure Notice Deadline. In the event Buyer fails to timely deliver to

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Seller and Escrow Agent Buyer’s Election Not to Terminate in accordance with the provisions of this Section 4.3, such failure shall be deemed to constitute Buyer’s election to terminate this Agreement in accordance with the terms and conditions of Section 4.2 hereof.

4.4 Return of Documents. Upon any termination of this Agreement and the Escrow, Buyer shall cause to be delivered to Seller all items representing the Due Diligence Materials which were previously delivered by Seller to Buyer pursuant to this Agreement.

ARTICLE 5 SELLER’S COVENANTS

During the period from the Effective Date through the Closing, Seller hereby covenants and agrees as follows:

5.1 Operations. Seller shall operate and manage the Property in accordance with its customary practices and maintain the Property in first class condition, subject to normal wear and tear. Seller shall not remove any items of Personal Property from the Real Property nor shall Seller sell, convey, assign, transfer or otherwise dispose of any of the Property, other than in the ordinary course of business. Seller shall not create or permit the creation of any liens, security interests, encumbrances or other charges on or against any of the Property, and, without the prior written approval of Buyer in each instance, which approval shall not be unreasonably withheld, shall not enter into or record any easement, right-of-way, covenant, condition, restriction or agreement affecting the Real Property or any portion thereof unless the same will be removed on or before the Closing. Seller shall use commercially reasonable efforts to preserve any existing relationships with vendors, suppliers and others, as well as the goodwill enjoyed by Seller in the operation of the Property.

5.2 Contracts. During the period from Effective Date through the expiration of the Investigation Period, Seller shall not enter into, or renew, extend, amend, modify, waive material rights under, terminate or permit to terminate any Contracts relating to or affecting any of the Property without the prior written approval of Buyer in each instance, which approval shall not be unreasonably withheld, and Seller shall timely perform its obligations under all Contracts relating to or affecting any of the Property. During the period from the expiration of the Investigation Period through the Closing, Seller shall not enter into, or renew, extend, amend, modify, waive material rights under, terminate or permit to terminate any Assumed Contracts relating to or affecting any of the Property without the prior written approval of Buyer in each instance, which approval shall not be unreasonably withheld, and Seller shall timely perform its obligations under all Assumed Contracts relating to or affecting any of the Property.

5.3 Memberships.

5.3.1 Transition Letter/Memberships. On the Closing, Seller shall prepare and send to the Members of the Club a letter (the “Transition Letter”), in form and substance reasonably acceptable to Buyer, advising all Members that:

(a) The Property has been conveyed by Seller to Buyer; and

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(b) The existing membership program (“Membership Program”), all existing Memberships in the Club and all Membership Agreements will remain in effect and be honored by Buyer.

5.3.2 Memberships. Seller shall not offer or sell any new Memberships in the Club subsequent to the Effective Date without the prior written consent of Buyer.

5.4 Insurance. Seller shall keep in effect through the Closing all current casualty, liability and other policies of insurance relating to the Property or the operation, maintenance or management thereof.

5.5 Permits. Seller shall maintain the Permits in full force and effect and shall not take any action or permit any action to be taken which will invalidate, jeopardize, suspend, terminate or otherwise adversely affect the Permits and/or any of Seller’s rights thereunder. Seller shall maintain the Liquor License in full force and effect and shall not take any action or permit any action to be taken which will invalidate, jeopardize, suspend, terminate or otherwise adversely affect the Liquor License and/or any of Seller’s rights thereunder.

5.6 Entitlements. Seller shall maintain the Entitlements in full force and effect and shall not take any action or permit any action to be taken which will invalidate, jeopardize, suspend, terminate or otherwise adversely affect the Entitlements and/or any of Seller’s rights thereunder.

5.7 Trade Names and Trademarks. Seller shall maintain the Trade Names and Trademarks in full force and effect and shall not take any action or permit any action to be taken which will invalidate, jeopardize, suspend, terminate or otherwise adversely affect the Trade Names and Trademarks and/or any of Seller’s rights thereunder.

5.8 Inventory. Seller shall maintain all pro shop, food and beverage, pesticide, fertilizer and other inventories and supplies of the Club Facilities at customary levels, and Seller shall not allow such inventories or supplies to materially deplete to levels below those existing on the date of execution of this Agreement.

5.9 Gratuities. Seller shall not give, sell or otherwise distribute any Gratuities subsequent to the Effective Date.

5.10 Wages, Salaries and Other Compensation. Neither Seller nor Manager shall not increase the amount of any wages, salaries and/or other compensation or benefits payable to and/or provided to any employees or independent contractors of the Club subsequent to the Effective Date, other than those that are contractually obligated to be provided and excluding discretionary bonuses provided in the ordinary course of operations.

5.11 Audit of Books and Records. In the event Buyer elects to conduct an audit, which audit shall be at Buyer’s sole cost and expense, of Seller’s Books and Records, Seller agrees to make all such Books and Records available and also to reasonably cooperate with Buyer and Buyer’s auditors in connection with such audit.

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5.12 Information. Seller shall promptly furnish to Buyer any information relating to the Property or the ownership, maintenance, management and administration thereof as may be reasonably requested by Buyer.

5.13 Monetary Obligations. Seller shall pay and satisfy in full any and all Monetary Obligations on or before the Closing Date.

5.14 New Liens, Liabilities and Encumbrances. Seller shall not cause or grant (and shall use commercially reasonable efforts not to permit, as the case may be) any new liens, liabilities, encumbrances or exception to title to the Property without the prior written consent of Buyer in each instances, which consent shall not be unreasonably withheld.

ARTICLE 6 SELLER’S DELIVERIES

On or before 5:00 p.m. PST on the last Business Day prior to the Closing Date, Seller shall deliver to Escrow Agent the items described in Sections 6.1 through 6.12, inclusive, and shall deliver to Buyer outside of Escrow the items described in Sections 6.13 through 6.15, inclusive.

6.1 Seller’s Deed. Seller’s Deed, duly executed and acknowledged by Seller. Pursuant to Section 12.1.1 hereof, all documentary transfer tax information shall be affixed to Seller’s Deed after recordation.

6.2 Bill of Sale. One (1) original of the Bill of Sale, duly executed by Seller.

6.3 Assignment of Trade Names and Trademarks. Two (2) counterpart originals of the Assignment of Trade Names and Trademarks, duly executed by Seller.

6.4 Assignment and Assumption of Contracts. Two (2) counterpart originals of the Assignment and Assumption of Contracts, duly executed by Seller.

6.5 Assignment of Permits, Intangibles and Entitlements. Two (2) counterpart originals of the Assignment of Permits, Intangibles and Entitlements, duly executed by Seller.

6.6 Assignment and Assumption of Membership Program, Memberships and Membership Agreements. Two (2) counterpart originals of the Assignment and Assumption of Membership Program, Memberships and Membership Agreements, duly executed by Seller.

6.7 Assignment of Water Rights [and Water Contracts]. Two (2) counterpart originals of the Assignment of Water Rights [and Water Contracts], duly executed by Seller.

6.8 Certificate of Non-Foreign Status and 1099. The Certificate of Non-Foreign Status and 1099, duly executed by Seller.

6.9 [Alternative: Interim Food & Beverage Management Agreement. Two (2) counterpart originals of the Interim Food & Beverage Management Agreement, duly executed by Seller].

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6.10 Seller’s Charges. Such funds as may be required, in addition to funds deposited with by Buyer, to (a) discharge all Monetary Obligations (other than the Permitted Title Exceptions); and (b) pay any amounts required to be paid by Seller in accordance with the provisions of Article 11 hereof.

6.11 Seller’s Affidavits, Certificates and Evidence of Authority. To the extent required by the Title Insurer and/or Escrow Agent: (a) any and all affidavits and other written documentation reasonably required as a condition to the issuance of the Title Policy; (b) all certificates required to be delivered by Seller pursuant to this Agreement; and (c) evidence that Seller and those acting for Seller have full authority to consummate the transaction contemplated by this Agreement, as modified through the Closing, including, without limitation, certified copies of the corporate or other resolutions authorizing the transaction contemplated by this Agreement.

6.12 Additional Documents. Such additional documents, instructions or other items as may be necessary or appropriate to comply with the provisions of this Agreement and to effect the transactions contemplated hereby.

6.13 Evidence of Termination of Contracts. Written documentation reasonably satisfactory to Buyer of the termination by Seller of all Contracts (other than the Assumed Contracts) that would be binding upon Buyer or the Property following Closing, effective as of a date not later than the Closing Date, and the payment by Seller of all amounts due under such Contracts up to and through the effective date of termination including, without limitation, any termination fees or similar payments, and that neither Buyer nor the Property shall be bound thereby or have any liabilities or obligations thereunder.

6.14 Evidence of Termination of Management Agreement. Written documentation reasonably satisfactory to Buyer that the Management Agreement has been terminated effective as of a date not later than the Closing Date, and the payment by Seller of all amounts due under such Management Agreement up to and through the effective date of termination including, without limitation, any termination fees or similar payments, and that neither Buyer nor the Property shall be bound thereby or have any liabilities or obligations thereunder.

6.15 Keys and Additional Items. All keys, combinations to locks and/or other codes, passwords or instructions for other security devices relating to the Property.

ARTICLE 7 BUYER’S DELIVERIES

On or before 12:00 p.m. on the Closing Date, Buyer shall deliver to Escrow Agent the items described in this Article 7.

7.1 Closing Deposit. The Closing Deposit for the Property pursuant to Section 2.2.3 hereof. The Purchase Price shall be credited by the Deposit previously deposited by Buyer with Escrow Agent pursuant to Section 2.2 hereof.

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7.2 Assignment and License of Trade Names and Trademarks. Two (2) counterpart originals of the Assignment and License of Trade Names and Trademarks, duly executed by Buyer.

7.3 Assignment and Assumption of Contracts. Two (2) counterpart originals of the Assignment and Assumption of Contracts, duly executed by Buyer.

7.4 Assignment of Permits, Intangibles and Entitlements. Two (2) counterpart originals of the Assignment of Permits, Intangibles and Entitlements, duly executed by Buyer.

7.5 Assignment and Assumption of Membership Program, Memberships and Membership Agreements. Two (2) counterpart originals of the Assignment and Assumption of Membership Program, Memberships and Membership Agreements, duly executed by Buyer.

7.6 Assignment of Water Rights [and Water Contracts]. Two (2) counterpart originals of the Assignment of Water Rights [and Water Contracts], duly executed by Buyer.

7.7 [Alternative: Interim Food & Beverage Management Agreement. Two (2) counterpart originals of the Interim Food & Beverage Management Agreement, duly executed by Buyer].

7.8 Buyer’s Charges. Funds sufficient to pay all amounts required to be paid by Buyer in accordance with the provisions of Article 11 hereof, in the form of Cash.

7.9 Evidence of Authority: Evidence that Buyer and those acting for Buyer have full authority to consummate the transaction contemplated by this Agreement, as modified through the Closing, including, without limitation, certified copies of the corporate or other resolutions authorizing the transaction contemplated by this Agreement.

7.10 Additional Documents. Such additional documents, instructions or other items as may be necessary or appropriate to comply with the provisions of this Agreement and to effect the transactions contemplated hereby.

ARTICLE 8 CONDITIONS TO CLOSING; CLOSING; AND

TERMINATION UPON DEFAULT

8.1 Conditions to Obligations of Buyer. The Closing of the transaction contemplated pursuant to this Agreement and Buyer’s obligation to purchase the Property are subject to satisfaction, prior to the Closing Date, of all of the following conditions, each of which is for the benefit of Buyer and may be waived by Buyer in its sole discretion:

8.1.1 Representations, Warranties and Covenants True/Seller’s Certificate. All of the representations, warranties and covenants of Seller set forth in Article 9 of this Agreement shall be true and correct in all material respects on the Closing Date as though made at the time of the Closing. Without limiting the foregoing, on or before the Closing Date, Seller shall have delivered to Buyer a written certificate, duly executed by Seller, certifying that all of the

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representations, warranties and covenants of Seller set forth in this Agreement are true and correct in all material respects as of the Closing Date.

8.1.2 Due Diligence Materials. Pursuant to Section 4.1.4 hereof, Seller shall have timely delivered to Buyer all items constituting the Due Diligence Materials.

8.1.3 Conduct of Affairs. Seller shall have timely performed all of its obligations set forth in Article 5 hereof.

8.1.4 Delivery of Items. Seller shall have executed and timely delivered to Escrow Agent all of the items referred to in Article 6 hereof.

8.1.5 Performance of Obligations. Seller shall have performed all of the obligations under this Agreement to be performed by Seller prior to the Closing.

8.1.6 Title Policy. Title Insurer is committed to issue an American Land Title Association Owner’s Policy of Title Insurance with Extended Coverage, together with any endorsements reasonably requested by Buyer including, without limitation, an endorsement deleting the “creditor’s rights exclusion” (the “Title Policy”) from Title Insurer, with liability in the amount of the Purchase Price, insuring that fee title to the Real Property vests in Buyer subject only to the Permitted Exceptions.

8.1.7 Litigation. Except as otherwise disclosed to Buyer in writing prior to the expiration of the Investigation Period, no suit, action, claim or other proceeding shall have been instituted or, to Seller’s actual knowledge without independent investigation or inquiry, threatened against Seller which results or reasonably might be expected to result in the transactions contemplated by this Agreement being enjoined or declared unlawful, in any lien attaching to or against the Property, in any diminution in the value or usefulness of the Property and/or in any liabilities, damages or costs being imposed upon Buyer or the Property.

8.1.8 Material Loss; Operations. Following the Effective Date, there shall have been no Material Loss, and there shall have been no material disruption of the operations, maintenance and/or management of the Club Facilities as a result of any cause whatsoever. All Personal Property shall be in good operating condition and repair as of the Closing.

8.1.9 Liquor License. Buyer shall have obtained all necessary governmental approvals which will enable Buyer to sell alcoholic beverages on or about the Club Facilities in a manner consistent with past practices upon the recordation of Seller’s Deed. Seller shall cooperate with Buyer to effectuate the issuance of the new liquor license(s) to be held by Buyer with respect to the sale of alcoholic beverages on or about the Club Facilities. [Alternative: Buyer shall have obtained all necessary governmental approvals which will enable Buyer to sell alcoholic beverages on or about the Club Facilities in a manner consistent with past practices pursuant to the Interim Food & Beverage Management Agreement to be executed by Buyer and Seller and delivered to Escrow Agent on or before the Closing.]

8.1.10 Consents. All requisite consents of third parties to the assignment of the Assumed Contracts to Buyer shall have been obtained.

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8.1.11 Termination of Employees and Independent Contractors. Buyer shall have received written verification from the Seller and Manager that all existing employees and independent contractors of the Club have been terminated as of the Closing and that each such employee and independent contractor has received all wages, salary, accrued vacation and sick leave, and any other benefits to which such employee and independent contractor is entitled as of and through the date of the Closing. Seller acknowledges and agrees that Buyer is under no obligation to hire any of the employees and/or independent contractors of the Club. Buyer may, in its sole and absolute discretion, hire one or more of the employees and/or independent contractors of the Club upon terms and conditions acceptable to Buyer. Buyer acknowledges that neither Seller, Manager nor any affiliate or management company has engaged or participated in, nor has received notice of, any decisions of Buyer to hire or not hire any employee or independent contractor of the Club. Buyer shall be solely responsible for and shall indemnify, defend and hold Seller and Manager, and their respective affiliates, members, partners, officers, directors, shareholders, trustees, beneficiaries, agents, representatives, successors and assigns, harmless from and against any and all claims, demands, suits, arbitrations, actions, causes of action and other legal proceedings of whatsoever kind or nature brought or maintained by any such former employees and/or independent contractors, and from all liabilities, damages, judgments, costs, fees and expenses (including reasonable attorneys’ fees) arising therefrom, arising out of or relating to: (a) any agreement or understanding by and between Buyer and any such former employee or independent contractor concerning Buyer’s potential employment of any such former employee or independent contractor; and (b) Buyer’s actual employment of one or more of such former employees and/or independent contractors, provided, as stated above, Seller acknowledges that Buyer shall be under no obligation to hire any such former employees or independent contractors.

8.1.12 Termination of Management Agreement. Seller shall have delivered to Buyer written documentation, which documentation shall be in form and substance reasonably satisfactory to Buyer, evidencing that the Management Agreement has been terminated effective on or before the Closing Date, that Seller has paid all amounts due thereunder up to and through the effective date of termination including, without limitation, any termination fees or similar payments, and that neither Buyer nor the Property shall be bound thereby or have any liabilities or obligations thereunder.

8.1.13 Termination of Contracts. Seller shall have delivered to Buyer written documentation, which documentation shall be in form and substance reasonably satisfactory to Buyer, evidencing that all of the Contracts (other than the Assumed Contracts) that would be binding on Buyer or the Property following Closing have been terminated effective as of a date not later than the Closing Date, that Seller has paid all amounts due under such Contracts up to and through the effective date of termination including, without limitation, any termination fees or similar payments, and that neither Buyer nor the Property shall be bound thereby or have any liabilities or obligations thereunder.

8.1.14 Books and Records. Buyer shall have received the originals of all Books and Records.

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8.1.15 Permits, Intangibles and Entitlements. Buyer shall have received the originals, or copies if originals are not available, of all of the Permits, Intangibles and Entitlements.

8.2 Conditions to Obligations of Seller. The Closing of the transactions contemplated pursuant to this Agreement and the obligation of Seller to sell, convey, assign, transfer and deliver the Property to Buyer are subject to satisfaction, prior to or at the Closing, of all of the following conditions, each of which is for the benefit of Seller and may be waived by Seller in its sole discretion:

8.2.1 Representations, Warranties and Covenants True. All of the representations, warranties and covenants of Buyer set forth in Article 10 of this Agreement shall be true and correct in all material respects on the date of the Closing as though made at the time of the Closing.

8.2.2 Performance of Obligations. Buyer shall have performed all of the obligations of Buyer under this Agreement to be performed by Buyer prior to the Closing.

8.2.3 Delivery of Items. Buyer shall have executed and timely delivered to Escrow Agent all of the items referred to in Article 7 hereof.

8.3 Casualty; Condemnation Proceeding.

8.3.1 Material Loss. In the event that, prior to the Closing, the Real Property shall suffer a Material Loss, Seller shall immediately notify Buyer and Escrow Agent of such Material Loss and, in such a case: (a) Buyer shall have the right to terminate this Agreement and its obligation to purchase the Property pursuant to the terms of Section 8.5 hereof; or (b) accept the Real Property in its then existing condition and purchase and acquire the Property in accordance with the terms and conditions of this Agreement, subject to the terms and conditions described in this Section 8.3. If Buyer exercises its right to purchase and acquire the Property in its present condition, then Seller shall assign to Buyer on the Closing any and all casualty insurance proceeds previously paid or payable to Seller and Buyer shall be entitled to a credit against the Purchase Price in an amount equal to any insurance deductible, as well as an amount equal to the estimated costs, fees and expenses to repair and/or replace the uninsured portion of the Material Loss. Buyer’s termination right or Buyer’s acceptance right shall be exercised by written notice to Seller within thirty (30) Calendar Days after Buyer receives written notice from Seller of the occurrence of the Material Loss.

8.3.2 Non-Material Loss. In the event that, prior to the Closing, the Real Property shall suffer a Non-Material Loss, Seller shall immediately notify Buyer and Escrow Agent of such Non-Material Loss and, in such a case, Buyer shall be obligated to purchase the Property (in its then existing condition) in accordance with the terms and conditions of this Agreement, subject to the terms and conditions of this Section 8.3.2. In such a case, Seller shall assign to Buyer on the Closing any and all casualty insurance proceeds previously paid or payable to Seller and Buyer shall also be entitled to a credit against the Purchase Price in an amount equal to any insurance deductible, as well as an amount equal to the estimated costs, fees and expenses to repair and/or replace the uninsured portion of such Non-Material Loss.

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8.4 Closing. Subject to the provisions of Section 8.3 hereof, in the event all of the conditions set forth in Sections 8.1 and 8.2 are timely satisfied (or waived in writing by Buyer or Seller, as applicable), Seller and Buyer shall take such action as may be required to cause the purchase and sale of the Property to be effected in accordance with this Agreement on or before the Closing Date. All such conditions shall be deemed waived in the event the Closing occurs hereunder.

8.5 Failure of Conditions to Closing. In the event one or more of the conditions to the Closing described in Section 8.1 of this Agreement are not satisfied or waived on or before the Closing Date, such condition cannot be satisfied within fifteen (15) Calendar Days after the original Closing Date after reasonable, good faith effort on the part of both Seller and Buyer, and the failure of such conditions to be satisfied is not a result of a default by Buyer, then Buyer shall have the right to terminate this Agreement and the Escrow by giving written notice of termination to Seller. In the event one or more of the conditions to the Closing described in Section 8.2 of this Agreement are not satisfied or waived on or before the Closing Date, such condition cannot be satisfied within fifteen (15) Calendar Days after the original Closing Date after reasonable, good faith effort on the part of both Seller and Buyer, and the failure of such conditions to be satisfied is not a result of a default by Seller, then Seller shall have the right to terminate this Agreement and the Escrow by giving written notice of termination to Buyer. In the event either Party elects to terminate this Agreement and the Escrow for the reasons and in accordance with the procedures set forth in this Section 8.5, Escrow Agent shall cause to be paid and distributed to Buyer the amount of the Deposit previously paid by Buyer to Escrow Agent pursuant to Section 2 hereof, together with any accrued interest thereon. In the event either Party elects to terminate this Agreement and the Escrow for the reasons and in accordance with the provisions set forth in this Section 8.5, this Agreement shall automatically terminate and Seller and Buyer agree to execute such escrow cancellation instructions as may be necessary to effectuate the cancellation of the Escrow. Any escrow cancellation, title cancellation and other cancellation charges shall be borne equally by Seller and Buyer. Upon the satisfaction by Seller and Buyer of each of their respective obligations set forth in this Section 8.5 hereof, neither Seller nor Buyer shall have any further rights or obligations to each other (except as expressly provided in this Agreement).

8.6 Breach/Termination. In the event either Seller or Buyer defaults hereunder or otherwise fails to perform any of their respective obligations to be performed, other than in the case of Buyer’s termination pursuant to Sections 4.2 or 8.3 hereof, and other than in the case of Seller’s or Buyer’s termination pursuant to Section 8.5 hereof and other than in connection with any indemnity hereunder (which shall not be limited by the following provisions), then the non-breaching Party may elect the applicable remedies set forth in this Section 8.6, which remedies shall constitute the sole and exclusive remedies of the non-breaching Party with respect to a default by the other Party under this Agreement.

8.6.1 Remedies of Buyer. In the event Buyer is the non-breaching Party, as Buyer’s sole and exclusive remedy, Buyer may elect to: (i) pursue the equitable remedy of specific performance to require conveyance of the Property to Buyer; or (ii) terminate this Agreement and the Escrow by giving Seller written notice describing Seller’s default and setting forth Buyer’s election to immediately terminate this Agreement and the Escrow. In the event Buyer so elects to terminate this Agreement and the Escrow, not later than five (5) Calendar

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Days after any such termination by Buyer, Escrow Agent shall cause to be paid to Buyer the Deposit previously paid by Buyer to Escrow Agent pursuant to Section 2 hereof, together with any interest accrued thereon.

8.6.2 Remedies of Seller. In the event Seller is the non-breaching Party, as Seller’s sole and exclusive remedy, Seller may elect to terminate this Agreement and the Escrow by giving Buyer and Escrow Agent written notice describing Buyer’s default and stating Seller’s election to immediately terminate this Agreement and the Escrow. In the event Seller elects to terminate this Agreement and the Escrow, the sole and exclusive remedy of Seller upon any such termination shall be to receive the amount specified as liquidated damages pursuant to Section 8.6.3 hereof.

8.6.3 SELLER’S LIQUIDATED DAMAGES. IF BUYER FAILS TO COMPLETE THE PURCHASE OF THE PROPERTY IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THIS AGREEMENT (OTHER THAN AS A RESULT OF BUYER’S ELECTION TO TERMINATE PURSUANT TO SECTIONS 4.2, 8.3 OR SECTION 8.6.1(ii) OR OTHER SECTION REQUIRING A RETURN OF THE DEPOSIT TO BUYER, AND OTHER THAN IN THE CASE OF SELLER’S OR BUYER’S TERMINATION PURSUANT TO SECTION 8.5 HEREOF, BY REASON OF THE DEFAULT OF BUYER, SELLER SHALL BE RELEASED FROM ITS OBLIGATION TO SELL THE PROPERTY TO BUYER. IN SUCH A CASE, SELLER AND BUYER AGREE THAT IT WOULD BE DIFFICULT OR IMPOSSIBLE TO DETERMINE THE AMOUNT OF DAMAGES OF SELLER AS A RESULT OF ANY SUCH BREACH BY BUYER AND, ACCORDINGLY, AS SELLER’S SOLE AND EXCLUSIVE REMEDY, SELLER SHALL BE ENTITLED TO RETAIN THE DEPOSIT, TOGETHER WITH ANY ACCRUED INTEREST THEREON, AS LIQUIDATED DAMAGES. THE PAYMENT OF SUCH LIQUIDATED DAMAGES TO SELLER SHALL CONSTITUTE THE EXCLUSIVE REMEDY OF SELLER ON ACCOUNT OF THE DEFAULT BY BUYER AND SELLER’S AND BUYER’S GOOD FAITH, REASONABLE ESTIMATE OF SELLER’S ACTUAL DAMAGES.

8.6.4 Cancellation Instructions and Costs. Upon any termination of this Agreement pursuant to this Section 8.6, this Agreement will automatically terminate without any further acts of either Seller or Buyer. In such a case, Seller and Buyer agree to execute such escrow cancellation instructions as may be necessary to effectuate the cancellation of the Escrow as may be required by Escrow Agent. The breaching Party hereunder shall pay any and all escrow costs incurred in connection herewith. Upon the satisfaction by Seller and Buyer of each of their respective obligations set forth in this Section 8.6 hereof, neither Seller nor Buyer shall have any further rights or obligations to each other except with respect to any indemnity obligations hereunder.

ARTICLE 9 REPRESENTATIONS, WARRANTIES AND

COVENANTS OF SELLER

In addition to the representations, warranties and covenants of Seller contained elsewhere in this Agreement, Seller hereby makes the following representations, warranties and covenants, each of which (a) is material and being relied upon by Buyer; (b) is true, complete and not

28 SDCA_1384546.1

misleading in all material respects as of the date hereof and as of the Closing; and (c) shall be deemed remade by Seller as of the Closing with the same force and effect as if made at that time. [Optional: As used in this Agreement, all references to “Seller’s actual knowledge” or similar terminology thereof shall be limited to the collective actual, personal knowledge, without independent investigation or inquiry, of ____________, ___________, and ________________ (the “Designated Representatives”). In no event shall the same include any knowledge imputed to Seller by any other person or entity. Seller hereby represents and warrants that the Designated Representatives possess the most knowledge about the Property.] In the event that, during the period between the Effective Date and the Closing, Seller or Manager learns, or has reason to believe, that any of the following representations, warranties and covenants may not be true in all material respects, Seller hereby covenants to give notice thereof to Buyer immediately.

9.1 Organization, Power and Authority. Seller is a ______________, duly organized and validly existing under the laws of the State of ______________. Seller has all requisite power and authority to own, operate, maintain, manage and administer the Property, to execute and deliver this Agreement and the Transaction Documents to which Seller is a party, and to perform its obligations hereunder and thereunder and effect the transactions contemplated hereby and thereby. All requisite [corporate, limited liability company or partnership] actions and/or other necessary actions have been taken (or as of the Closing, shall have been taken) to authorize and approve the execution, delivery and performance by Seller of this Agreement and the Transaction Documents to which Seller is a party.

9.2 No Conflicts. The execution, delivery and performance by Seller of this Agreement and the Transaction Documents to which Seller is a party, and the consummation of the transactions contemplated hereby and thereby, will not (a) violate any provision of the organizational documents of Seller (b) violate, conflict with or result in a breach of or default under any term or provision of any contract or agreement to which Seller is a party or by or to which Seller or any of its assets or properties are or may be bound or subject, (c) violate any order, judgment, injunction, award or decree of any court or arbitration body, or any governmental, administrative or regulatory authority, or any other body, by or to which Seller or the Property are or may be bound or subject, or (d) violate any statute, law or regulation.

9.3 Approvals. No approval or consent of any foreign or domestic governmental, administrative or regulatory body or of any other person or entity is required to be obtained by Seller for the execution, delivery or performance by Seller of this Agreement or the Transaction Documents to which Seller is a party.

9.4 Litigation and Condemnation. Seller has not received written notice of, and Seller is not otherwise aware of, any pending or threatened claims, actions, suits, arbitrations, proceedings (including condemnation proceedings) or investigations by or before any court or arbitration body, any governmental, administrative or regulatory authority, or any other similar body, against or affecting the Property or the transactions contemplated by this Agreement.

9.5 Title to Real Property. Except as may be provided herein, no consent of any other person or entity is required in connection with Seller’s obligations hereunder or in connection with the transactions contemplated hereby which are to be performed by Seller.

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9.6 No Violations. The Real Property is in compliance with all federal, state and local laws, regulations and ordinances applicable to the development, ownership, operation, maintenance and management of the Real Property, including without limitation all laws, regulations and ordinances relating to zoning, planning, land-use and building restrictions, construction, Environmental Laws, subdivision, fire, health and safety, and alcoholic beverage sales.

9.7 Compliance with Laws. Seller has complied, and is currently in compliance with, all federal, state and local laws, regulations and ordinances applicable to the development, ownership, operation, maintenance and management of the Real Property, and/or otherwise applicable to Seller, including, without limitation, all laws, regulations and ordinances relating to zoning, planning, land-use and building restrictions, construction, Environmental Laws, subdivision, fire, health and safety, and alcoholic beverage sales.

9.8 Permits and Entitlements. To Seller’s actual knowledge, (i) Seller has obtained all governmental permits, licenses, approvals and authorizations (including, without limitation, the Permits and the Entitlements), required for the development, ownership, operation, maintenance and management of the Property, and (ii) all such permits, licenses, approvals and authorizations (including, without limitation, the Permits and the Entitlements), are in full force and effect and, to the extent the same are material, are transferable to Buyer, excluding the Liquor License. A list of such permits, licenses, approvals and authorizations (including, without limitation, the Permits and the Entitlements), is set forth on Schedules 2.1.4 and 2.1.6, attached hereto and incorporated herein by reference.

9.9 Insurance. Attached hereto as Schedule 9.9 is a list of all insurance that is carried by Seller which is applicable to the operation of the Real Property. Schedule 9.9 shall include the following with respect to each policy of insurance: (a) the name of the insurance company providing the coverage; (b) the type of coverage provided; (c) the name, address and telephone number of the insurance agent through whom the insurance was obtained; and (d) the amount of coverage provided by each such policy of insurance.

9.10 Memberships. Schedule 9.10 constitutes a true, correct and complete list of the name, address and telephone number of all individuals, families and groups who currently possess any class or type of Membership, with an indication of the type of Membership and the term of each such Membership. Schedule 9.10 also includes a true, correct and complete list of all classes of existing Memberships including a statement of (a) the current membership fee and monthly dues and minimum food and beverage requirement for each class of Membership; (b) any refund obligations pertaining to each Membership; and (c) all other fees, dues, charges and other amounts payable by Members of the Club. Other than those Members listed on Schedule 9.10, no other person or entity has: (i) any benefits, rights or privileges, as a Member, relating to the Club and/or the Club Facilities; and (ii) any right to utilize or enjoy any of the Club Facilities as a Member.

9.11 Gratuities. Schedule 9.11 constitutes a true, correct and complete list of all gratuitous or reduced green fees, driving range fees, Club access fees, complimentary passes, food and beverage discounts, rain checks, discounts, gift certificates, trade/barter arrangements and other privileges and entitlements (collectively “Gratuities”), which Seller has disbursed by

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gift, sale or otherwise. Pursuant to Section 11.2.5 of this Agreement, on or before the Closing, Seller and Buyer shall prorate the value of such Gratuities. Buyer shall honor all Gratuities which are prorated between Seller and Buyer pursuant to Section 11.2.5 of this Agreement.

9.12 Leases. There are no leases, tenancies or rental agreements affecting all or any portion of the Real Property or the Personal Property (except for the Contracts).

9.13 Contracts. There are no Contracts with any person or entity which must be assumed by Buyer at the Closing or which may impose any obligation on Buyer or the Property whatsoever, financial or otherwise, other than the Assumed Contracts. To Seller’s actual knowledge, the Assumed Contracts are in full force and effect and constitute valid and enforceable agreements of Seller, free and clear of all liens, charges, encumbrances and adverse claims, and no event has occurred which with notice or lapse of time or both would result in default thereunder.

9.14 Use of Trade Names and Trademarks. The use by Buyer of the Trade Names and/or Trademarks pursuant to the Assignment and License of Trade Names and Trademarks will not infringe any copyright or any United States or State trademark or other intellectual property right existing on the Closing or constitute unfair competition or actionable appropriation of rights with respect to any other person or entity. Attached hereto as Schedule 2.1.7 is a list of all business names, trade marks, service marks, trade names and other business names and logos that have been used by Seller in connection with the Club Facilities, including details as to how and when any of such names, marks and logos have been registered, either federally, with the State of North Carolina or both.

9.15 Environmental Matters. To Seller’s actual knowledge: (i) the Improvements are free from Hazardous Materials; (ii) the soil, surface water and ground water of, under, on or around the Real Property are free from Hazardous Materials; (iii) the Real Property has never been used for or in connection with the manufacture, refinement, treatment, storage, generation, transport or hauling of any Hazardous Material in excess of levels permitted by applicable Environmental Laws, nor has the Real Property been used for or in connection with the disposal of any Hazardous Materials; and (iv) the Real Property is now and at all times has been in compliance with all Environmental Laws.

9.16 Personal Property. A list of Personal Property is set forth on Schedule 2.1.2, attached hereto and incorporated herein by reference, separately identifying items owned by Seller and items leased by Seller. All such Personal Property will be transferred to Buyer free and clear of any ownership interests, liens, security interests, leasehold interests, claims or charges of any kind or nature, other than any of the foregoing which will be discharged on or before the Closing, and the rights and interests of equipment lessors or secured parties under any Assumed Contracts.

9.17 Labor Matters.

9.17.1 Employees and Independent Contractors. Seller and Manager are not parties to any collective bargaining agreement with any employees, have not received any demands for collective bargaining and are not otherwise aware of any unionizing efforts. To

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Seller’s actual knowledge without independent investigation or inquiry, Seller and Manager have in all material respects complied with all applicable laws and regulations relating to employment matters, including, without limitation, fair labor standards, wage and hour requirements, collective bargaining laws, withholding and other tax laws relating to employment, and occupational health and safety requirements. Schedule 9.17 constitutes a true, correct and complete list of all employees and independent contractors employed at the Property together with: (a) the amount of wages, salaries and/or other compensation or other benefits payable or provided to such employees and independent contractors; (b) all benefits to which such employees and independent contractors are entitled; (c) whether or not each employee or independent contractor is employed at will or pursuant to an oral or written employment agreement; and (d) whether or not each such employee or independent contractor may be terminated at will or pursuant to an oral or written agreement.

It is understood and agreed by the Parties hereto that nothing in this Agreement or the performance of this Agreement shall create, or is intended to create, an employment relationship, whether direct, or joint or otherwise, between Buyer and any current or future employee of Seller or Manager Seller and Manager shall have and retain sole responsibility for, decision-making authority regarding, and control over their respective employees during their employment with Seller or Manager, as applicable, including, but not limited to, hiring, firing, discipline, training, transfer, reassignment, evaluation, direction and control, safety, payment of wages, establishment of personnel policies, provision of tools and equipment, and all other terms and conditions of such employment. Seller and Manager each agree that it alone has the responsibility for making deductions from its employees’ compensation required by law, reporting compensation of such employees as required by law, and generally determining any and all appropriate forms of compensation and fringe benefits for them during their employment with Seller or Manager, as applicable, and bears sole liability for the payment of social security taxes, workmen’s compensation, unemployment compensation and similar obligations as a result of their employment with Seller or Manager, as applicable. Buyer shall not have any liability to any employee of Seller or Manager whatsoever arising out of such employee’s employment with the Seller or Manager, as applicable, or the termination thereof. All such liability shall remain with Seller and Manager, respectively.

Seller shall indemnify, defend and hold Buyer and its affiliates, and their respective members, partners, officers, directors, shareholders, trustee, beneficiaries, employees, agents, attorneys, representatives, successors and assigns (collectively, the “Buyer Indemnified Parties”), harmless from and against any and all claims, demands, suits, arbitrations, actions, causes of action and other legal proceedings of whatsoever kind or nature, and from all liabilities, damages, judgments, costs, fees and expenses (including reasonable attorney’s fees) arising therefrom (collectively, the “Claims”), that may be imposed on, incurred by or asserted against any such Buyer Indemnified Party arising out of or in connection with: (i) any act or omission of any employee of Manager or Seller, as applicable, while performing services for or on behalf of the Club on or before the Closing; (ii) any and all employment and labor related Claims by any employee, agent or independent contractor arising out of the employee’s or independent contractor’s employment or contractual relationship with Manager or Seller, as applicable, to perform services at or on behalf of the Club on or before the Closing including, without limitation, any and all claims or counterclaims for breach of contract, breach of fiduciary duty, unfair competition, defamation, wrongful or unlawful discharge, tortious interference,

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constructive discharge, for past or future wages, salary, bonuses, earnings, restricted stock, deferred compensation or other forms of compensation or benefits (including any Employee Plan), claims or counterclaims for violations of Title VII of the Civil Rights Act of 1964 as amended, 42 U.S.C. § 2000(e) et seq., the Americans with Disabilities Act, the Age Discrimination in Employment Act, 29 U.S.C. §621 et seq., the Fair Labor Standards Act, the Family and Medical Leave Act, and the Employee Retirement Income Security Act of 1974, and all amendments thereto, violations of any state and/or municipality whistle-blowing statutes or laws or fair employment statutes or laws, or violations of any other law, rule, regulation, or ordinance pertaining to employment, wages, hours, or any other terms and conditions of employment and termination of employment; and (iii) any express or implied representation by Seller or Manager regarding any employee’s or independent contractor’s continued employment or retention of services at the Club subsequent to the Closing. Nothing in this Section 9.17, however, shall require Seller to be responsible for, or indemnify and hold harmless any Buyer Indemnified Party for, any Claims arising out of: (a) any agreement or understanding by and between Buyer and any such former employee or independent contractor concerning Buyer’s potential employment of any such former employee or independent contractor; or (b) Buyer’s actual employment of one or more of such former employees and/or independent contractors. The Parties hereby agree that the provisions of this paragraph are in no way intended to modify or limit the provisions of Section 13.1 hereof.

9.17.2 Severance Arrangements. Seller and Manager have not entered into any severance or similar arrangement in respect of any present or former officer or employee of the Club Facilities that will result in any obligation, whether absolute or contingent, of Buyer to make any payment to any such present or former officer or employee of the Club Facilities following the termination of the employment of such person by Manager

9.17.3 Employee Benefit Plans. Schedule 9.17.3 includes a full and complete list of each (i) employee benefit plan (within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), (ii) deferred compensation, incentive compensation, bonus, stock purchase, stock option or other equity compensation, severance, termination, retention, and (ii) any other employee benefit plan, fund, program, arrangement, commitment or agreement, which Manager or any ERISA Affiliate (as defined below) maintains, sponsors, contributes to or is required to contribute to, or maintained, sponsored, contributed to or was required to contribute to, for the benefit of current or former employees of Manager assigned at the Club Facilities (each, an “Employee Plan”). “ERISA Affiliate” shall mean any entity which is (at any relevant time) a member of a controlled group of corporations with or under common control with Manager, as defined in Section 414(b), (c) or (m) of the Code.

It is understood and agreed by the Parties hereto that Buyer is not assuming and shall have no liability or obligation under or with respect to any Employee Plan. Seller shall cause Manager to terminate the Employee Plans on or before the Closing Date and will remain solely and exclusively liable for any and all benefits accrued and due to any employee thereunder.

9.18 Financial Statements. Seller has delivered to Buyer true, correct and complete copies of Seller’s previous five (5) years’ annual audited financial statements, including any and

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all amendments thereto, such annual financial statements consisting for each year of an income statement and a balance sheet for the Club Facilities. Seller makes no representation regarding any errors or omissions related to such financial statements. Seller will provide Buyer with access to all books and records of Seller.

9.19 TBSE. Schedule 9.19 sets forth a true, correct and complete list of all of the TBSE to be held at the Club subsequent to the Closing.

9.20 Non-Foreign Status. Seller is not a “foreign person” as such term is defined in Section 1445 of the Code. Seller shall deliver to Buyer at the Closing, a Certificate of Non-Foreign Status, in the form of Exhibit “H,” duly acknowledged by Seller.

9.21 OFAC. Seller is in compliance with the requirements of Executive Order No. 13224, 66 Fed. Reg. 49079 (Sept. 23, 2001) (the “Order”) and other similar requirements contained in the rules and regulations of the Office of Foreign Assets Control, Department of the Treasury (“OFAC”) and in any enabling legislation or other Executive Orders or regulations in respect thereof (the Order and such other rules, regulations, legislation, or orders are collectively called the “Orders”). Seller:

(a) is not listed on the Specially Designated Nationals and Blocked Persons List maintained by OFAC pursuant to the Order and/or on any other list of terrorists or terrorist organizations maintained pursuant to any of the rules and regulations of OFAC or pursuant to any other applicable Orders (such lists are collectively referred to as the “Lists”);

(b) is not a person who has been determined by competent authority to be subject to the prohibitions contained in the Orders; and

(c) is not owned or controlled by, or acts for or on behalf of, any person on the Lists or any other person who has been determined by competent authority to be subject to the prohibitions contained in the Orders.

9.22 Due Diligence Materials. Seller has delivered to Buyer true, correct and complete copies of all of the documents, agreements and other items constituting the Due Diligence Materials.

9.23 Discovery of New Information. If, prior to the Closing Date, Seller discovers any information or facts that would change the foregoing representations and warranties, and/or cause them to be untrue or misleading in any respect, Seller shall immediately give notice to Buyer of those facts and information.

9.24 Full Disclosure. The Exhibits attached hereto are hereby incorporated by reference and to Seller’s actual knowledge all information set forth in such Exhibits is true and correct in all material respects. To Seller’s actual knowledge, no representation or warranty made by Seller in this Agreement, and no statement, list, schedule, exhibit or certificate furnished or to be furnished by Seller pursuant hereto or in connection with the transactions contemplated hereby contains any untrue statement of a material fact, or omits to state a material fact necessary to make the statements contained therein not misleading.

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9.25 Reliance. The foregoing representations and warranties are made by Seller with the knowledge and expectation that Buyer is placing, and is entitled to place, complete reliance thereon, notwithstanding any independent investigations conducted by Buyer or any of Buyer’s representatives.

9.26 Survival. The representations and warranties contained in this Agreement by Seller are true, correct and complete and shall be deemed remade by Seller as of the Closing with the same force and effect as if made at that time. The representations and warranties of Seller set forth in Sections 9.1 and 9.2 of this Agreement, as well as the right and ability of Buyer to enforce the same, shall survive the Closing indefinitely. The representations and warranties of Seller set forth in Sections 9.3 through 9.22, inclusive, hereof, as well as the right and ability of Buyer to enforce the same, shall survive the Closing for a period of two (2) years.

ARTICLE 10 REPRESENTATIONS AND WARRANTIES OF BUYER

In addition to the representations and warranties of Buyer contained elsewhere in this Agreement, Buyer hereby makes the following representations and warranties, each of which representation and warranty (a) is material and being relied upon by Seller; and (b) is true, complete and not misleading in all material respects as of the date hereof and as of the Closing.

10.1 Organization, Power and Authority. Buyer is a _________________, duly organized and validly existing under the laws of the State of ____________ and authorized to do business in the State where the Real Property is located. Buyer has all requisite power and authority to execute and deliver this Agreement and the Transaction Documents to which Buyer is a party, and to perform its obligations hereunder and thereunder and to effect the transactions contemplated hereby and thereby. All requisite [corporate, limited liability company or partnership] or other action has been taken to authorize and approve the execution, delivery and performance by Buyer of this Agreement and the Transaction Documents to which Buyer is a party.

10.2 No Conflicts or Violations. The execution, delivery and performance by Buyer of this Agreement and the Transaction Documents to which Buyer is a party, and the consummation of the transactions contemplated hereby and thereby, will not (a) violate any provision of Buyer’s organization documents, (b) violate, conflict with or result in a breach of or default under any term or provision of any contract or agreement to which Buyer is a party or by or to which Buyer or any of its assets or properties are or may be bound or subject, or (c) to Buyer’s actual knowledge, without independent investigation or inquiry, violate any order, judgment, injunction, award or decree of any court or arbitration body, or any governmental, administrative or regulatory authority, or any other body, by or to which Buyer or the Property are or may be bound or subject.

10.3 Approvals. To Buyer’s actual knowledge, without independent investigation or inquiry, no approval or consent of any foreign or domestic governmental, administrative or regulatory body or any other person or entity is required for the execution, delivery or performance by Buyer of this Agreement or the Transaction Documents to which Buyer is a party.

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10.4 Survival. The representations and warranties contained in this Agreement by Buyer are true, correct and complete and shall be deemed remade by Buyer as of the Closing with the same force and effect as if made at that time. The representations and warranties of Buyer set forth in Sections 10.1 and 10.2 of this Agreement, as well as the right and ability of Seller to enforce the same, shall survive the Closing indefinitely. The representations and warranties of Buyer set forth in Section 10.3 hereof, as well as the right and ability of Seller to enforce the same, shall survive the Closing for a period of two (2) years.

ARTICLE 11 COSTS, EXPENSES AND PRORATIONS

11.1 Costs and Expenses.

11.1.1 Seller. Seller shall pay (a) all recording costs and documentary transfer taxes, deed stamps and other costs payable in connection with the recordation of Seller’s Deed and the conveyance of the Real Property; (b) the cost of the Title Policy (including any binders or endorsements to the Title Policy reasonably requested by Buyer); (c) one-half (1/2) of Escrow Agent’s fees and costs for the Escrow; (d) Seller’s share of prorations; and (e) Seller’s attorneys’ fees.

11.1.2 Buyer. Buyer shall pay (a) one-half (1/2) of Escrow Agent’s fees and costs for the Escrow; (b) Buyer’s share of prorations; and (c) Buyer’s attorneys’ fees.

11.2 Prorations. The following prorations shall be made between Seller and Buyer on the Closing, computed effective as of the Closing. All such prorations shall be set forth on Schedule 11.2 and attached to this Purchase Agreement on or before the Closing. Pursuant to Section 11.4 hereof, on or before [_______________], Seller and Buyer shall complete and conduct the Final Accounting which shall include, without limitation, verification of the calculation of all prorations completed by Seller and Buyer pursuant to this Section 11.2 as of the Closing.

11.2.1 Real Property Taxes. All general and special real estate taxes and assessments based on the regular tax bill for the current fiscal year (or, if such tax bill has not been issued as of the date of Closing, the regular tax bill for the fiscal year preceding the current fiscal year) shall be prorated between the Parties at the Closing, on a calendar year basis. In the event that a separate tax bill for the Real Property has not been issued, Seller shall request an apportionment from the Mecklenburg County Assessor’s Office. In the event such assessment cannot be completed by the Closing, general and special real estate taxes and assessments shall be prorated based upon Seller’s and Buyer’s written apportionment statement. In preparing such written apportionment statement, Seller and Buyer shall apportion said taxes by such reasonable basis as may be mutually agreeable to Buyer and Seller. Notwithstanding the foregoing, all accrued and/or unpaid real property taxes and assessments including, without limitation, any supplemental tax bills or assessments, with respect to the Real Property which arise, accrue and/or relate to any time period prior to the Closing shall be the responsibility of Seller and shall be paid by Seller prior to delinquency.

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11.2.2 Personal Property Taxes. All personal property taxes applicable to the Personal Property shall be prorated between Seller and Buyer as of the Closing.

11.2.3 Sales Taxes. Seller shall bear, be responsible for and shall pay for, all sales and use taxes arising out of the sale and transfer by Seller to Buyer of the Property.

11.2.4 TBSE Deposits. Seller shall reimburse or credit Buyer for the remaining amount of any deposits, advance registrations and other fees received by Seller with respect to the TBSE listed on Schedule 9.19 attached hereto and incorporated herein by reference.

11.2.5 Gratuities. Seller shall reimburse Buyer for the amount of all Gratuities as set forth in Schedule 9.11 hereof, to the extent not redeemed prior to Closing.

11.2.6 Memberships.

(a) All prepaid annual, monthly, quarterly or other periodic membership fees (excluding Membership Deposits), dues and charges, including, without limitation, food and beverage minimums, range fees, locker fees, bag storage fees, driving range fees, trail fees and cart fees, previously received by Seller for any annual, monthly, quarterly or other period subsequent to the Closing, shall be prorated between Seller and Buyer effective as of the date of the Closing.

(b) Subject to the provisions of Sections 11.2.6(c) and (d) hereof, all Membership Deposits (excluding initiation fees or deposits for Term Memberships), charges or dues with respect to Memberships previously sold by Seller shall belong to Seller, but any accrued and unpaid amounts shall not be credited to Seller at Closing.

(c) In the event the Membership Program includes one or more categories of Memberships which are effective only for a specified term of one (1) year or less (ex: Annual, Semi-Annual or Monthly Memberships) (“Term Memberships”), all prepaid Membership Deposits previously received by Seller with respect to such Term Memberships shall be allocated proportionally over the term of each such Term Memberships and all such Membership Deposits shall be prorated between Seller and Buyer effective as of the date of the Closing.

(d) Notwithstanding the provisions of Sections 11.2.6(a), (b) and (c) above, neither Seller nor Buyer shall be obligated to make any payment or give any credit to the other Party on account of, or by reason of, any Membership Deposits, dues or charges as described in Sections 11.2.6(a), (b) and (c) above, which are unpaid as of the Closing. In the event any such amounts are received by Seller or Buyer following the Closing, such amounts shall immediately be paid by the Party receiving the same to the Party entitled to receive the same pursuant to the provisions of this Section 11.2.6.

(e) To the extent that, following the Closing, Seller receives any membership fees (excluding Membership Deposits), dues, charges or any other rentals, receipts, revenues or other amounts that relate to the time period following the Closing, Seller shall promptly remit such amounts to Buyer. To the extent that, following the Closing, Buyer receives any membership fees (excluding Membership Deposits), dues, charges or any other rentals,

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receipts, revenues or other amounts that relate to the time period prior to the Closing, Buyer shall promptly remit such amounts to Seller.

11.2.7 Utility Charges. All utility charges applicable to the Real Property shall be prorated between Seller and Buyer as of the Closing, pursuant to final meter readings. Seller shall be entitled to receive all utility deposits or receive a credit for same at Closing.

11.2.8 Assumed Contracts. All sums paid or owing pursuant to the Assumed Contracts (except with respect to the TBSE deposits) shall be prorated between Seller and Buyer as of the Closing.

11.2.9 Other Payables and Receivables.

[Alternative A: All account payables and account receivables relating to the operation of the Property prior to the Closing and not otherwise provided for in this Section 11.2, shall remain the obligation and property of Seller.]

[Alternative B: All account payables relating to the operation of the Property prior to the Closing and not otherwise provided for in this Section 11.2 shall remain the obligation and property of Seller. All account receivables relating to the operation of the Property prior to the Closing and not otherwise provided for in this Section 11.2 (the “Pre-Closing Account Receivables”), shall be assigned to Buyer at Closing, provided Seller shall be entitled to receive a proration credit in an amount equal to one-half of the outstanding balance of all such Pre-Closing Account Receivables. Subject to the provisions of this Section 11.2.9, following the Closing, all Pre-Closing Account Receivables shall belong to and become the property of Buyer.]

11.2.10 Delinquent Revenues.

[Alternative A: Seller retains the right to recover all accrued and unpaid amounts that Seller is entitled to receive pursuant to this Section 11.2 up to and through the Closing (the “Delinquent Revenues”), including, without limitation, the right to pursue a claim for such amounts against any Member and/or third party responsible for payment of such amounts. Without limiting the foregoing, in the event Buyer receives any Delinquent Revenues, Buyer hereby agrees to remit the same to Seller within thirty (30) Calendar Days of Buyer’s receipt thereof. Buyer may not waive any Delinquent Revenues, nor modify a Membership Agreement or Assumed Contract so as to reduce any Delinquent Revenues which are owed under such Membership Agreement or Assumed Contract, for any period in which Seller is entitled to receive such charges or amounts, without first obtaining Seller’s prior written consent. Buyer shall reasonably cooperate with Seller to enforce the provisions of the Membership Agreements and Assumed Contracts which require the applicable Members or third parties to pay to Seller such Delinquent Revenues.]

[Alternative B: Effective as of the Closing, Seller hereby transfers, conveys and assigns to Buyer the right to recover all accrued and unpaid amounts that Seller is entitled to receive pursuant to this Section 11.2 up to and through the Closing (the “Delinquent Revenues”), including, without limitation, the right to pursue a claim for such amounts against any Member and/or third party responsible for payment of such amounts. Seller shall promptly

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remit to Buyer any Delinquent Revenues received by Seller following the Closing. Seller may not waive any Delinquent Revenues prior to the Closing without first obtaining Buyer’s prior written consent. Seller shall reasonably cooperate with Buyer to enforce the provisions of the Membership Agreements and Assumed Contracts which require the applicable Members or third parties to pay such Delinquent Revenues.]

11.3 Buyer’s Representative. In connection with the Closing, Buyer shall have the right, by an independent accounting firm and/or such other representative as may be designated by Buyer, to take a physical inventory at the Real Property as of the Closing and make such other investigations with respect to the Property and the Books and Records relating to the operation of the Property as Buyer may deem necessary for the purposes of assisting Buyer in implementing the proration provisions of this Article 11 or for any other purpose.

11.4 Final Accounting. Seller and Buyer acknowledge and agree that on the Closing, Seller and Buyer may not have sufficient information at their disposal to conduct and complete a final proration of all items subject to proration pursuant to this Article 11. Accordingly, Seller and Buyer hereby agree as follows: (a) on the Closing, Seller and Buyer shall in good faith calculate the prorations contemplated in Article 11 effective as of the Closing; and (b) on or before [___________], Seller and Buyer shall conduct a final accounting of all matters and items subject to proration pursuant to this Article 11 (“Final Accounting”). In the event it is determined pursuant to the Final Accounting that any amounts are due and owing by Seller to Buyer, then Seller shall cause such amounts to be paid to Buyer on or before ten (10) Calendar Days from the date the Final Accounting is completed. In the event it is determined pursuant to the Final Accounting that any amounts are due and owing by Buyer to Seller, then Buyer shall cause such amounts to be paid to Seller on or before ten (10) Calendar Days from the date the Final Accounting is completed. In the event Seller or Buyer fails to pay to the other Party within such ten (10) Calendar Day period any sums owing to such Party pursuant to the Final Accounting, all such unpaid amounts shall bear interest at the rate of eighteen percent (18%) per annum until paid.

11.5 Remedies. Notwithstanding the terms and conditions of Section 8.6.1 and 8.6.2 hereof, Seller and Buyer shall be entitled to all contractual remedies at law or in equity relating to a breach by the other Party under this Article 11 hereof.

ARTICLE 12 ACTIONS TO BE TAKEN AT THE CLOSING

12.1 Actions by Escrow Agent. In connection with the Closing, Escrow Agent shall take the following actions:

12.1.1 Recording. Escrow Agent shall cause Seller’s Deed (with documentary transfer tax information to be affixed after recording) for the Real Property to be recorded in the Official Records of _________ County, _______________, and obtain a conformed copy thereof for distribution to Seller and Buyer.

12.1.2 Title Policy. Escrow Agent shall direct Title Insurer to issue the Title Policy to Buyer.

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12.1.3 Distribution of Funds. Escrow Agent shall disburse all funds deposited with Escrow Agent by Buyer in payment of the Purchase Price as follows:

(a) Deduct, pay and satisfy all items chargeable to the account of Seller pursuant to Section 11.1 hereof.

(b) Deduct, pay and satisfy all Monetary Obligations against the Real Property, other than the Permitted Exceptions.

(c) If, as a result of the prorations and credits pursuant to Article 11 hereof, amounts are to be charged to the account of Seller, deduct the net amount of such charges.

(d) Disburse the remaining balance of the Purchase Price to Seller promptly upon the Closing.

All disbursements by Escrow Agent shall be by wire transfer to the designated account of the receiving Party or shall be by checks of Escrow Agent, as may be directed by the receiving Party.

12.1.4 Distribution of Seller’s Deed. Disburse to Seller an executed original of each of the Transaction Documents and a conformed copy of Seller’s Deed and any other documents deposited into Escrow by Seller.

12.1.5 Distribution of Transaction Documents. Disburse to Buyer an executed original of each of the Transaction Documents and a conformed copy of Seller’s Deed and any other documents deposited into Escrow by Buyer.

ARTICLE 13 INDEMNIFICATION

13.1 Indemnification by Seller. Seller hereby agrees to and shall indemnify, defend and hold harmless Buyer, and its affiliates, and each of their respective members, partners, officers, directors, shareholders, trustees, beneficiaries, employees, agents, representatives, successors and assigns (the “Indemnitees”), from and against any and all claims, demands, suits, arbitrations, actions, causes of action and other legal proceedings of whatsoever kind or nature, and from all liabilities, damages, judgments, costs, fees and expenses (including reasonable attorneys’ fees) arising therefrom (collectively, the “Losses”), arising out of or relating to any third party claims arising out of or relating to Seller’s previous ownership, management and/or operation of the Property. Buyer hereby acknowledges and agrees that the indemnification obligations of the Seller as set forth in this Section 13.1 shall specifically exclude: (a) any and all Losses to the extent attributable to the gross negligence, fraud or willful misconduct or intentional misconduct of any of the Indemnitees; and (b) any matter arising out of or relating to any breach of the representations, warranties or covenants made by Buyer contained in this Agreement or any documents executed in connection therewith.

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13.2 Notice and Opportunity to Defend.

13.2.1 Notice of Asserted Liability. Promptly after receipt by any Indemnitee of notice of any demand, claim or circumstance that would give rise to a claim (“Asserted Liability”), that may result in a claim for indemnification pursuant to Section 13.1 hereof, the Indemnitee shall give written notice thereof to the party obligated to provide indemnification pursuant to Section 13.1 hereof (the “Indemnifying Party”). The claims notice shall describe the Asserted Liability in reasonable detail, and shall indicate the amount (estimated, if necessary) of the loss or damage that has been or may be suffered by the Indemnitee.

13.3 Opportunity to Defend. The Indemnifying Party may elect to compromise or defend, at its own expense and by its own counsel, any Asserted Liability. If the Indemnifying Party elects to compromise or defend such Asserted Liability, it shall, within thirty (30) Calendar Days of receipt of the claims notice, notify the Indemnitee of its intent to do so, and the Indemnitee shall cooperate in the compromise of, or defense against, such Asserted Liability. The Indemnifying Party shall reimburse the Indemnitee for all out-of-pocket costs incurred by the Indemnitee in connection with such cooperation. If the Indemnifying Party elects not to compromise or defend the Asserted Liability, fails to notify the Indemnitee of its election as herein provided, or contests its obligation to indemnify under this Agreement, the Indemnitee may pay, compromise or defend such Asserted Liability and shall be entitled to reimbursement from the Indemnifying Party for all costs, fees and expenses incurred by the Indemnitee with respect to the payment, compromise and/or defense of such Asserted Liability. Furthermore, the Indemnitee and the Indemnifying Party may participate, at their own expense, in the defense of such Asserted Liability. If the Indemnifying Party chooses to defend any claim, the Indemnitee shall make available to the Indemnifying Party any books, records or other documents within its control that are necessary or appropriate for such defense.

13.4 Survival. The terms of this Article 13, as well as the right and ability of the Buyer to enforce the same, shall survive the Closing indefinitely.

ARTICLE 14 BROKERS

14.1 Broker. Upon the Closing, and only in the event of the Closing: (i) Seller shall pay to Seller’s Broker a commission through Escrow at the Closing pursuant to and in accordance with the separate agreement by and between Seller and Seller’s Broker (“Seller’s Broker’s Commission”); and (ii) Buyer shall pay to Buyer’s Broker a commission through Escrow at the Closing pursuant to and in accordance with the separate agreement by and between Buyer and Buyer’s Broker (“Buyer’s Broker’s Commission”). Except as described in this Article 14, Seller and Buyer hereby represent and warrant to each other that the warranting Party has not entered into nor will such warranting Party enter into any agreement, arrangement or understanding with any person or entity which will result in the obligation of the other Party to pay any finder’s fee, commission or similar payment in connection with the transactions contemplated by this Agreement. Seller and Buyer hereby agree to and shall indemnify, defend and hold harmless the other from and against any and all claims, costs, damages and/or liabilities arising from the breach of the foregoing representation by either Seller or Buyer, as the case may be.

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ARTICLE 15 MISCELLANEOUS

15.1 Assignment. No assignment of this Agreement or Buyer’s rights or obligations hereunder shall be made by Buyer without first having obtained Seller’s written approval of any such assignment, which approval shall not be unreasonably withheld. Notwithstanding the foregoing, Buyer shall have the right to assign this Agreement and the rights, duties and obligations of Buyer hereunder to any corporation, limited liability company, general or limited partnership or other entity which is an affiliate of Buyer (“Buyer’s Affiliate”), without the necessity of securing Seller’s prior written consent or approval.

15.2 Notices. Any tender, delivery, notice, demand or other communication (“Notice”) required or permitted under this Agreement shall be in writing, and shall be personally delivered or sent by registered or certified mail, postage prepaid, return receipt requested, overnight mailed, delivered or sent by telecopier or telefacsimile machine capable of confirming transmission and receipt, and shall be deemed delivered, given and received upon the earlier of (a) if personally served, the date of delivery to the person to receive such notice; (b) if given by telecopier or telefacsimile, when sent, provided a hard copy follow-up copy of the notice is sent by United States Mail, postage prepaid, as of the date of the transmission of the telecopier or telefacsimile; and (c) if mailed, four (4) Business Days after the date of posting by the United States Postal Service; or (d) if sent by Federal Express or other comparable overnight delivery service, upon delivery as documented by the service’s delivery records, all in accordance with the following:

If to Seller __________________________ __________________________ __________________________ __________________________ Attn: _____________________ FAX: (____) _______________

With copy to: __________________________

__________________________ __________________________ Attn: _____________________ FAX: (___) ________________

If to Buyer: __________________________

__________________________ __________________________ __________________________ Attn: ______________________ FAX:(___) _________________

With copy to: __________________________

__________________________ __________________________

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__________________________ Attn: ______________________ FAX:(___) _________________

15.3 Entire Agreement. This Agreement, including the Schedules and Exhibits

referred to herein, constitutes the entire contract between the Parties with respect to the subject matter covered by this Agreement. This Agreement supersedes all previous representations, arrangements, agreements and understandings by and among the Parties with respect to the subject matter covered by this Agreement, including without limitation all prior letters of intent executed between Buyer and Seller, and any such representations, arrangements, agreements and understandings are hereby canceled and terminated in all respects. This Agreement may not be amended, changes or modified except by a writing duly executed by both of the Parties hereto.

15.4 Severability. If any provision of this Agreement, or any portion of any such provision, is held to be unenforceable or invalid, the remaining provisions and portions shall nevertheless be carried into effect.

15.5 Remedies. The Parties shall not be deemed to waive any of their rights or remedies under this Agreement, unless such waiver is in writing and signed by the Party to be bound. No delay or omission on the part of either Party in exercising any right or remedy shall operate as a waiver of such right or remedy or any other right or remedy.

15.6 Headings. The headings contained in this Agreement are for convenience only and are not a part of this Agreement, and do not in any way interpret, limit or amplify the scope, extent or intent of this Agreement, or any of the provisions of this Agreement.

15.7 Counterparts. This Agreement may be executed in counterparts, each of which shall constitute an original, but all of which together shall constitute one and the same agreement.

15.8 Attorneys’ Fees. In the event any action is initiated for any breach of default in any of the terms or conditions of this agreement, then the Party in whose favor judgment shall be entered shall be entitled to have and recover from the non-prevailing Party all costs and expenses (including attorneys’ fees) incurred in such action and any appeal therefrom.

15.9 Governing Law and Adjudication. This Agreement shall be governed by and interpreted in accordance with the laws (other than that body of law relating to conflicts of law) of the State of _____________.

15.10 No Third Party Beneficiary. This Agreement creates rights and duties only between the Parties, and no third party is or shall be deemed to be or shall have any rights as a third party beneficiary.

15.11 Binding Effect. Subject to Section 15.1, this Agreement shall be binding upon and shall inure to the benefit of the Parties and their respective successors, assigns and legal and personal representatives.

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15.12 Seller’s 1031 Exchange. Buyer acknowledges that Seller may engage in a tax deferred exchange (“Seller’s Exchange”) pursuant to Section 1031 of the Code. To effect Seller’s Exchange, Seller may assign its rights in, and delegate its duties under this Agreement, as well as transfer the Property, to any exchange accommodator which Seller shall determine. As an accommodation to Seller, Buyer agrees to cooperate with Seller in connection with Seller’s Exchange, including the execution of documents therefor, provided the following terms and conditions are satisfied:

(a) Buyer shall have no obligation to take title to any property in connection with Seller’s Exchange;

(b) Except as otherwise provided in this Agreement, Buyer shall not be obligated to pay any escrow costs, brokerage commissions, title charges, survey costs, recording costs or other charges incurred with respect to any exchange property, and/or Seller’s Exchange;

(c) The Closing shall not be contingent or otherwise subject to the consummation of Seller’s Exchange, and the Escrow shall timely close in accordance with the terms of this Agreement notwithstanding any failure, for any reason, of the parties to Seller’s Exchange to effect the same;

(d) All representations, warranties, covenants and indemnification obligations of Seller set forth in this Agreement shall not be affected or limited by Seller’s use of an exchange accommodator and shall survive Seller’s Exchange as provided herein and shall continue to inure directly from Seller for the benefit of Buyer;

(e) All representations, warranties, covenants and indemnification obligations of Buyer set forth in this Agreement shall not be affected or limited by Seller’s use of an exchange accommodator and shall survive Seller’s Exchange as provided herein and shall continue to inure directly from Buyer for the benefit of Seller;

(f) Seller agrees to indemnify, protect, defend (with counsel reasonably acceptable to Buyer) and hold Buyer harmless from and against any and all causes of action, claims, demands, liabilities, costs and expenses, including actual attorneys’ fees and costs, incurred by Buyer in connection with Seller’s Exchange.

Buyer makes absolutely no representations or warranties of any kind or nature (express or implied) that tax deferred exchange treatment is available to Seller with respect to Seller’s Exchange, or that such a transaction will qualify in any respect for such treatment, and Buyer shall incur no liability if Seller’s Exchange fails to qualify for the tax deferred treatment intended by Seller. Seller hereby acknowledges and represents to Buyer that Seller is relying solely and entirely upon the advice of Seller’s own consultants with respect to any and all aspects of Seller’s Exchange. In no event shall the obligations of Seller under this Agreement be contingent upon this transaction being included as part of Seller’s Exchange.

15.13 Buyer’s 1031 Exchange. Seller acknowledges that Buyer may be purchasing the Property as an upleg transaction as part of a tax deferred exchange (“Buyer’s Exchange”) pursuant to Section 1031 of the Code. In order to effect Buyer’s Exchange, Buyer may assign its rights in, and delegate its duties under, this Agreement, as well as transfer the Property, to any

44 SDCA_1384546.1

exchange accommodator which Buyer shall determine. As an accommodation to Buyer, Seller agrees to cooperate with Buyer in connection with Buyer’s Exchange, including the execution of documents therefor, provided the following terms and conditions are satisfied:

(a) Seller shall have no obligation to take title to any property in connection with Buyer’s Exchange;

(b) Except as otherwise provided in this Agreement, Seller shall not be obligated to pay any escrow costs, brokerage commissions, title charges, survey costs, recording costs or other charges incurred with respect to any exchange property;

(c) The Closing shall not be contingent or otherwise subject to the consummation of Buyer’s Exchange, and the Escrow shall timely close in accordance with the terms of this Agreement notwithstanding any failure, for any reason, of the parties to Buyer’s Exchange to effect the same;

(d) All representations, warranties, covenants and indemnification obligations of Seller set forth in this Agreement shall not be affected or limited by Buyer’s use of an exchange accommodator and shall survive Buyer’s Exchange as provided herein and shall continue to inure directly from Seller for the benefit of Buyer;

(e) All representations, warranties, covenants and indemnification obligations of Buyer set forth in this Agreement shall not be affected or limited by Buyer’s use of an exchange accommodator and shall survive Buyer’s Exchange as provided herein and shall continue to inure directly from Buyer for the benefit of Seller;

(f) Buyer agrees to indemnify, protect, defend (with counsel reasonably acceptable to Seller) and hold Seller harmless from and against any and all causes of action, claims, demands, liabilities, costs and expenses, including actual attorneys’ fees and costs, incurred by Seller in connection with Buyer’s Exchange.

Seller makes absolutely no representations or warranties of any kind or nature (express or implied) that tax deferred exchange treatment is available to Buyer with respect to Buyer’s Exchange, or that such a transaction will qualify in any respect for such treatment, and Seller shall incur no liability if Buyer’s Exchange fails to qualify for the tax deferred treatment intended by Buyer. Buyer hereby acknowledges and represents to Seller that Buyer is relying solely and entirely upon the advice of Buyer’s own consultants with respect to any and all aspects of Buyer’s Exchange. In no event shall the obligations of Buyer under this Agreement be contingent upon this transaction being included as part of Buyer’s Exchange.

15.14 Survival. Except as otherwise provided in this Agreement to the contrary, the covenants and obligations of the Parties to this Agreement shall survive the Closing indefinitely.

15.15 Time of the Essence. Time is of the essence for the performance of each and ever obligation hereunder.

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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first above written.

SELLER: ____________________________________ By: _________________________________

Name: ______________________________ Title: _______________________________ BUYER: ____________________________________

By: __________________________________ Name: ______________________________ Title: _______________________________

[Signature page to Purchase and Sale Agreement and Escrow Instructions] [________ Golf Club]

46 SDCA_1384546.1

47 SDCA_1384546.1

CONSENT OF ESCROW AGENT

The undersigned Escrow Agent hereby agrees to (i) accept the foregoing Purchase

Agreement, (ii) be Escrow Agent under said Purchase Agreement, (iii) to make all filings required under Section 6045 of the Internal Revenue Code of 1986, as amended, and (iv) be bound by said Purchase Agreement in the performance of its duties as Escrow Agent; provided, however, the undersigned shall have no obligations, liability or responsibility under (a) this Consent or otherwise, unless and until said Purchase Agreement, fully signed by the parties, has been delivered to the undersigned, or (b) any amendment to said Purchase Agreement unless and until the same is accepted by the undersigned in writing.

Dated: _____________, 20___ _____________________________________

By__________________________________ Its__________________________________