EXHIBIT 10.1 VENTURE FORMATION AND CONTRIBUTION AGREEMENT

EXHIBIT 10.1

VENTURE FORMATION AND CONTRIBUTION AGREEMENT

By and Between

CNL INCOME PARTNERS, LP,
a Delaware limited partnership,

- and -

GREAT BEAR LODGE OF WISCONSIN DELLS, LLC,
a Delaware limited liability company

- and –

GREAT BEAR LODGE OF SANDUSKY, LLC,
a Delaware limited liability company

- and –

GREAT WOLF RESORTS, INC.,
a Delaware corporation

October 3, 2005

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TABLE OF CONTENTS

1.

Recitals.

 

2.

Definitions.

 

3.

Contribution to the Partnership.

 

4.

Contribution Value of the Property.

 

5.

Conditions Precedent.

 

6.

Requirements Upon Satisfaction of Closing Conditions.

 

7.

CNL Due Diligence with Respect to Contributed Hotels.

 

8.

Representations and Warranties.

 

9.

Covenants of Wolf.

 

10.

Closing.

 

11.

Prorations and Expenses.

 

12.

Default; Remedies.

 

13.

Dells Hotel Development.

 

14.

Liquor Licenses.

 

15.

Condemnation/Casualty.

 

16.

Assignability.

 

17.

Brokers.

 

18.

Miscellaneous.

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SCHEDULE OF EXHIBITS

 

Exhibit “D” Assignment and Assumption of Declaration of Easements and Covenant to Share Costs for Great Wolf Lodge

 

Exhibit “E” Assignment and Assumption of Great Wolf Lodge Condominium Management Agreement

 

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VENTURE FORMATION AND CONTRIBUTION AGREEMENT

THIS VENTURE FORMATION AND CONTRIBUTION AGREEMENT (this “ Agreement ”) is made and entered into as of the 3 ^rd day of October, 2005 (the “ Effective Date ”), by and among CNL INCOME PARTNERS, LP , a Delaware limited partnership (“ CNL ”), GREAT BEAR LODGE OF WISCONSIN DELLS, LLC, a Delaware limited liability company (“ Wolf Dells ”), GREAT BEAR LODGE OF SANDUSKY, LLC, a Delaware limited liability company (“ Wolf Sandusky ”), and GREAT WOLF RESORTS, INC., a Delaware corporation ( “ Wolf Parent ” )(Wolf Dells, Wolf Sandusky and Wolf Parent are at times hereinafter referred to collectively as “ Wolf ”).

R E C I T A L S:

A. Wolf Dells is the fee simple owner of that certain real property more particularly described on Exhibit “A-1" attached hereto (together with all easements, rights of way, gores of land, streets, ways, alleys, passages, sewer rights, waters, water courses, water rights and powers, and all estates, rights, titles, interests, privileges, liberties, tenements, hereditaments and appurtenances whatsoever, in any way belonging, relating or appertaining to any of the said real property, the “ Dells Land ”) and all fixtures, buildings, structures, parking areas, and other improvements presently located upon the Dells Land, including, without limitation, a three hundred nine (309) room hotel, an approximately thirty-eight thousand (38,000) square foot indoor water-park component, an approximately ten thousand (10,000) square foot outdoor water-park component, a Wiley’s Woods component, an arcade and all restaurant, bar, gift shop, casual dining and spa facilities located thereon (the “ Dells Improvements ”), located in Sauk County, Wisconsin, and commonly referred to as the “Great Wolf Lodge-Wisconsin Dells.” The Dells Land and the Dells Improvements are sometimes collectively referred to herein as the “ Dells Hotel .” Wolf Dells is also the fee simple owner of the Commercial Condominium Unit (as herein defined).

B. Wolf Sandusky is the fee simple owner of that certain real property more particularly described on Exhibit “A-2" attached hereto (together with all easements, rights of way, gores of land, streets, ways, alleys, passages, sewer rights, waters, water courses, water rights and powers, and all estates, rights, titles, interests, privileges, liberties, tenements, hereditaments and appurtenances whatsoever, in any way belonging, relating or appertaining to any of the said real property, the “ Sandusky Land ”) and all fixtures, buildings, structures, parking areas, and other improvements presently located upon the Sandusky Land, including, without limitation, a two hundred seventy-one (271) room hotel, an approximately thirty-four thousand (34,000) square foot indoor water-park component and an approximately five thousand (5,000) square foot outdoor water-park component, an arcade and all restaurant, bar, gift shop and casual dining facilities located thereon (the “ Sandusky Improvements ”), located in Erie County, Ohio, and commonly referred to as the “Great Wolf Lodge-Sandusky.” The Sandusky Land and the Sandusky Improvements are sometimes collectively referred to herein as the “ Sandusky Hotel .” The Dells Hotel and the Sandusky Hotel are sometimes collectively referred to herein as the “ Contributed Hotels .”

C. CNL and Wolf Parent intend to joint venture for the purposes (the “ Business Purposes ”) of jointly owning, operating, marketing and leasing the Contributed Hotels through the Partnership (as defined herein).

D. In accordance with and conditioned upon the terms and provisions of this Agreement, (i) Wolf Parent shall cause the formation by certain of its Affiliates of a limited liability limited partnership known as CNL Income GW Partnership, LLLP, a Delaware limited liability limited partnership (the “ Partnership ”), for the Business Purposes, (ii) Wolf Parent shall cause certain of its Affiliates to execute and enter into a limited liability limited partnership agreement for the Partnership, (iii) Wolf Parent shall cause the contribution of each of the Contributed Hotels in fee simple to two (2) separate single-purpose entities which shall be wholly-owned subsidiaries of the Partnership (individually, an “ SPE Owner ” or collectively as the “ SPE Owners ”), (iv) Wolf Parent shall cause the contribution of the Personal Property (as defined herein) to the applicable SPE Owners or Tenants (as defined herein), as applicable; (v) Wolf Parent shall cause the contribution of the Commercial Condominium Unit in fee simple to the applicable SPE Owner, (vi) Wolf Parent shall sell or cause to be sold to CNL or its designated affiliates the general partner interest and a portion of the limited partner interest in the Partnership and the general partner interests in the Tenants; and (vii) CNL and Wolf shall cause the execution of that certain Amended and Restated Limited Liability Limited Partnership Agreement of CNL Income GW Partnership, LLLP, in the form attached hereto as Exhibit “B” (the “ Partnership Agreement ”).

E. Pursuant to the Partnership Agreement, CNL shall initially own, directly or through its wholly-owned subsidiary Affiliates, no less than, but at CNL’s election greater than, fifty-one percent (51%)(but in no event greater than seventy percent (70%)) of the aggregate limited and general partner interest in the Partnership and Wolf shall initially own, directly or through its wholly-owned subsidiary Affiliates, no greater than, but at CNL’s election, less than forty-nine percent (49%)(but in no event less than thirty percent (30%)) of the limited partnership interests in the Partnership, and CNL shall initially own, directly or through its wholly-owned subsidiary Affiliates, no less than, but at CNL’s election greater than, fifty-one percent (51%) (but in no event greater than seventy percent (70%)) of the aggregate limited and general partnership interests in the Tenants and Wolf shall initially own, directly or through its wholly-owned subsidiary Affiliates, no greater than, but at CNL’s election, less than forty-nine percent (49%)(but in no event less than thirty percent (30%)) of the limited partner interests in the Tenants.

NOW, THEREFORE , in consideration of the foregoing recitals and the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1.  Recitals . The foregoing recitals are true and correct and are incorporated herein as if repeated at length.

2.  Definitions .

(a) “ Affiliate ” shall mean any Person owned by, under common control with or controlled, directly or indirectly, by another Person. For the purposes of this Agreement, an “Affiliate” shall also mean and include a parent Entity, or the Person which has a Controlling Interest in (directly or indirectly) another Person. The plural of Affiliate is “Affiliates”.

(b) “ Agreement ” shall have the meaning ascribed to it in the first paragraph of this agreement.

(c) “ Assignment and Assumption of Condominium Documents ” shall mean an assignment and assumption of the Condominium Documents in the form attached hereto as Exhibit “C” and by this reference incorporated herein, pursuant to which Wolf Dells shall assign and transfer to either or several of the Partnership, the applicable Tenant or other designee of the Partnership, all of Wolf Dell’s right, title and interest in and to, and the Partnership, the applicable Tenant or designee, shall be entitled to all of Wolf Dells’ rights and benefits (including without limitation, all rights as Declarant thereunder) and assume all of Wolf Dell’s obligations and liabilities with respect to the Condominium Documents first accruing from and after Closing.

(d) “ Assignment and Assumption of Declaration of Easements and Covenant to Share Costs for Great Wolf Lodge ” shall mean an assignment and assumption of the Declaration of Easements and Covenant to Share Costs for Great Wolf Lodge in the form attached hereto as Exhibit “D” and by this reference incorporated herein, pursuant to which Wolf Dells shall assign and transfer to either the Partnership, the applicable SPE Owner or the applicable Tenant or other designee of the Partnership, all of Wolf Dell’s right, title and interest in and to, and the Partnership, the SPE Owner or applicable Tenant or designee, shall be entitled to all of Wolf Dells’ rights and benefits (including without limitation, all rights as Declarant thereunder) and assume all of Wolf Dell’s obligations and liabilities first accruing from and after Closing with respect to the Declaration of Easements and Covenant to Share Costs for Great Wolf Lodge.

(e) “ Assignment and Assumption of Great Wolf Lodge Condominium Management Agreement ” shall mean an assignment and assumption of the Great Wolf Lodge Condominium Management Agreement in the form attached hereto as Exhibit “E” and by this reference incorporated herein, pursuant to which Wolf Dells shall assign and transfer to either the Partnership, the applicable SPE Owner or the applicable Tenant or other designee of the Partnership, all of Wolf Dell’s right, title and interest in and to, and the Partnership, the SPE Owner or applicable Tenant or designee, shall be entitled to all of Wolf Dells’ rights and benefits and assume all of Wolf Dell’s obligations and liabilities first accruing from and after Closing with respect to the Great Wolf Lodge Condominium Management Agreement.

(f) “ Assignment and Assumption of Intangible Property ” shall mean an assignment and assumption of the Intangible Property in the form attached hereto as Exhibit “F” and by this reference incorporated herein, pursuant to which Wolf shall assign and transfer to either or several of the Partnership, the applicable SPE Owner, the applicable Tenant (with respect to, without limitation, Intangible Property which relates to Personal Property of which the applicable Tenants will be the owner as of Closing) or other designee of the Partnership, all of Wolf’s right, title and interest in and to, and the Partnership, the applicable SPE Owner, the applicable Tenant or designee, shall be entitled to all of Wolf’s rights and benefits and assume all of Wolf’s obligations and liabilities first accruing from and after Closing with respect to the Intangible Property, to the extent that such assignments are legally and contractually permitted.

(g) “ Assignment and Assumption of Operating Agreements ” shall mean an assignment and assumption of the Operating Agreements in the form attached hereto as Exhibit “G” and by this reference incorporated herein, pursuant to which Wolf shall assign and transfer to either or several of the Partnership, the applicable Tenant or other designee of the Partnership, all of Wolf’s right, title and interest in and to, and the Partnership, the applicable Tenant or designee, shall be entitled to all of Wolf’s rights and benefits and assume all of Wolf’s obligations and liabilities with respect to, the Operating Agreements first accruing from and after Closing.

(h) “ Assignment and Assumption of Rental Management Agreements ” shall mean the assignment and assumption of the Rental Management Agreements in the form attached hereto as Exhibit “H” and by this reference incorporated herein, pursuant to which Wolf shall assign and transfer to the applicable Tenant, all of Wolf’s right, title and interest in and to, the Rental Management Agreements, and the applicable Tenant, shall be entitled to all of Wolf’s rights and benefits and assume all of Wolf’s obligations and liabilities with respect to the Rental Management Agreements first accruing from and after Closing, to the extent that such assignments are legally and contractually permitted.

(i) “ Assignment of Partnership Interests – Joint Venture Entity ” shall mean the assignment of partnership interests in the form attached hereto as Exhibit “I” and by this reference incorporated herein, pursuant to which Wolf shall assign and transfer or cause to be assigned and transferred to the CNL Partner(s) all of Wolf’s or Wolf’s Affiliates’ right, title and interest in and to general and limited partner interests in the Partnership in accordance with this Agreement.

(j) “ Assignment of Partnership Interests – Tenants ” shall mean the assignments of partnership interests in the form attached hereto as Exhibit “J” and by this reference incorporated herein, pursuant to which Wolf shall assign and transfer or cause to be assigned and transferred to an Affiliate the CNL Partner(s) all of Wolf’s or Wolf’s Affiliates’ right, title and interest in and to general partner interests in the Tenants in accordance with this Agreement.

(k) “ Bankruptcy Code ” shall have the meaning ascribed to such term in Section 8(a)(v).

(l) “ Bills of Sale ” shall mean one or more special warranty bills of sale in the form attached hereto as Exhibit “K” and by this reference incorporated herein, pursuant to which Wolf shall transfer and convey to the Partnership, or the applicable Tenant, the Personal Property.

(m) “ Business Day ” shall mean any day other than a Saturday, Sunday or any other day on which banking institutions in the State of Florida or the State of Wisconsin are authorized by law or executive action to close.

(n) “ Business Purpose ” shall have the meaning ascribed to it in Recital C of this Agreement.

(o) “ Closing ” shall mean the consummation of the transactions contemplated by this Agreement which shall occur on the Closing Date.

(p) “ Closing Certificate ” shall mean that certain certificate in the form attached hereto as Exhibit “L” and by this reference incorporated herein, pursuant to which CNL or Wolf, as applicable, shall confirm the accuracy of the representations and warranties set forth herein as of the Closing Date.

(q) “ Closing Conditions ” shall have the meaning ascribed to it in Section 5 of this Agreement.

(r) “ Closing Date ” shall mean the Initial Anticipated Closing Date or, upon the exercise by CNL of its rights pursuant to Section 10(a) hereof, the Outside Closing Date (as the same may be extended by Wolf by the exercise of its extension rights hereunder) or such later or earlier date agreed to by CNL and Wolf.

(s) “ Closing Escrow ” shall have the meaning ascribed to it in Section 10(b) of this Agreement.

(t) “ Closing Statement ” shall have the meaning ascribed to it in Section 11(a) of this Agreement.

(u) “ CNL ” shall have the meaning ascribed to it in the first paragraph of this Agreement.

(v) “ CNL’s Closing Conditions ” shall have the meaning ascribed to it in Section 5(a) of this Agreement.

(w) “ CNL Closing Condition Failure ” shall have the meaning ascribed to it in Section 5(b) of this Agreement.

(x) “ CNL Partner(s) ” shall have the meaning ascribed to it in Section 6 of this Agreement.

(y) “ Commercial Condominium Unit ” shall have the meaning ascribed to it in the Condominium Documents.

(z) “ Condominium Documents ” shall mean that certain Declaration of Condominium for Great Wolf Lodge dated as of December 21, 2004 and recorded on June 14, 2005 as Document No. 874991 in the public records of Sauk County, Wisconsin (including all exhibits thereto).

(aa) “ Contribution Value ” shall mean the value of the Property, or any portion thereof as the context required, as of the Closing Date as set forth in Section 4 below.

(bb) “ Controlling Interest ” shall mean (a) as to a corporation, the right to exercise, directly or indirectly, more than fifty percent (50%) of the voting rights attributable to the shares of the Entity (through ownership of such shares or by contract), and (b) as to an Entity not a corporation, the possession directly, or indirectly, of the power to direct or cause the direction of the management or policies of the Entity.

(cc) “ Cure Period ” shall have the meaning ascribed to it in Section 7(b) of this Agreement.

(dd) “ Declaration of Easements and Covenant to Share Costs for Great Wolf Lodge ” shall mean that certain Declaration of Easements and Covenant to Share Costs for Great Wolf Lodge dated December 21, 2004, and recorded on January 5, 2005 as Document No. 856670 in the public records of Sauk County, Wisconsin (including all exhibits thereto).

(ee) “ Deeds ” shall mean the deed pursuant to which Wolf Dells shall convey to the applicable SPE Owner all of Wolf Dells’ right, title and interest in and to the Dells Hotel free of liens and encumbrances except the Permitted Exceptions, the deed pursuant to which Wolf Sandusky shall convey to the applicable SPE Owner all of Wolf Sandusky’s right, title and interest in and to the Sandusky Hotel free of liens and encumbrances except the Permitted Exceptions, and the deed pursuant to which Wolf Dells shall convey to the applicable SPE Owner all of Wolf Dells’ right, title and interest in and to the Commercial Unit (as such term is defined in the Condominium Documents) free of liens and encumbrances except the Permitted Exceptions, Such Deeds shall be by special warranty deeds in the form as is customary for commercial transactions in Wisconsin and Ohio respectively.

(ff) “ Default ” shall have the meaning ascribed to it in Section 12 of this Agreement.

(gg) “ Defaulting Party ” shall have the meaning ascribed to it in Section 12 of this Agreement.

(hh) “ Dells Attraction Addition ” shall have the meaning ascribed to it in Section 13(a) of this Agreement.

(ii) “ Dells Construction Documents ” shall mean all of those contracts, agreements, performance bonds, warranties and other documents relating to the construction of the Dells Attraction Addition.

(jj) “ Dells Hotel ” shall have the meaning ascribed to it in Recital A of this Agreement.

(kk) “ Dells Improvements ” shall have the meaning ascribed to it in Recital A of this Agreement.

(ll) “ Dells Land ” shall have the meaning ascribed to it in Recital A of this Agreement.

(mm) “ Development Agreement ” shall mean that certain agreement to be entered into by and between the applicable SPE Owner and Wolf Dells at Closing pursuant to which Wolf Dells will manage, and escrow funds for, the completion of the construction of the Dells Attraction Addition (as defined in Section 13(a) hereof). The Development Agreement shall be in the form attached hereto as Exhibit “M” attached hereto and by this reference incorporated herein.

(nn) “ Effective Date ” shall have the meaning ascribed to it in the first paragraph of this Agreement.

(oo) “ Entity ” shall mean any corporation, general or limited partnership, limited liability company, partnership, stock company or association, joint venture, company, trust, bank, trust company, land trust, business trust, cooperative, any government or agency or political subdivision thereof or any other legally existing entity.

(pp) “ Environmental Law ” shall mean any and all laws of a Governmental Authority: (i) applicable to the Property or any portion thereof; and, (ii) which relate to the protection of the environment, resource conservation, air contamination, water and/or groundwater contamination, soil or sediment contamination, Hazardous Substances, solid or hazardous wastes or residues, or occupational safety and health (to the extent relating to Hazardous Substances), as such Environmental Laws may be amended from time to time, including, without limitation, the Comprehensive Environmental, Response, Compensation and Liability Act, the Superfund Amendments and Reauthorization Act the Solid Waste Disposal Act, the Resource Conservation and Recovery Act of 1976, the Hazardous and Solid Waste Amendments of 1984, the Toxic Substances Control Act, the Federal Clean Air Act, the Federal Clean Water Act, the Safe Drinking Water Act, the Occupational Safety and Health Act, the Emergency Planning and Community Right-to-Know Act of 1986, the Federal Insecticide, Fungicide, and Rodenticide Act, the Atomic Energy Act of 1954, and the Energy Reorganization Act, the Oil Pollution Act of 1990.

(qq) “ Environmental Matters ” shall mean the presence of any Hazardous Substance in the soil, groundwater, surface water, sediment, or air at levels that exceed applicable standards or criteria and that require Remediation under any applicable Environmental Law.

(rr) “ Environmental Defect ” shall have the meaning ascribed to it in Section 7(d)(i) of this Agreement.

(ss) “ Environmental Notice ” shall have the meaning ascribed to it in Section 7(d)(i) of this Agreement.

(tt) “ Environmental Reports ” shall have the meaning ascribed to it in Section 7(d)(i) of this Agreement.

(uu) “ Escrow Agent ” shall mean Title Company acting in its capacity as an escrow agent pursuant to the terms hereof.

(vv) “ Existing Title Policies ” shall have the meaning ascribed to it in Section 7(b) of this Agreement.

(ww) “ Force Majeure Event ” shall mean any circumstance caused by any of the following: strikes; lockouts; acts of God; civil commotion; fire or other casualty; acts of terrorism; governmental action (including renovation or refusal to grant any required license or permit where such revocation or refusal is not due to the fault of the party affected thereby); or other cause or circumstance which is not in the reasonable control of the party asserting the existence of such cause or circumstance.

(xx) “ Governmental Authority ” shall mean any federal, state, or local governmental or quasi-governmental entity or authority, including, without limitation, any department, commission, board, bureau, agency, court or instrumentality thereof, in each case having jurisdiction, control, or authority over, or in connection with, the present or future use or development of any of the Contributed Hotels, or any portion thereof, including, without limitation, EPA and DEP.

(yy) “ Great Wolf Lodge Condominium Management Agreement ” shall mean that certain Great Wolf Lodge Condominium Management Agreement by and between Great Wolf Lodge Condominium Association, Inc. and Wolf Dells dated as of December 20 ^th , 2004.

(zz) “ Hazardous Substance ” shall mean materials and substances defined as “hazardous substances”, “hazardous wastes”, “toxic substances” or “toxic wastes” in (i) the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. Sections 9601-9675, as amended by the Superfund Amendments and Reauthorization Act of 1988, and any further amendments thereto and rules, orders and regulations thereunder; (ii) the Resource Conservation and Recovery Act of 1976, 42 U.S.C. Sections 6901-6992, as amended by the Hazardous and Solid Waste Amendments of 1984, and any further amendments thereto and rules, orders and regulations thereunder; or (iii) any other Environmental Law.

(aaa) “ House Funds ” shall mean cash on hand at or for the Contributed Hotels, including, without limitation, petty cash funds and cashiers’ banks.

(bbb) “ Initial Anticipated Closing Date ” shall mean October 11, 2005.

(ccc) “ Inspection Period ” shall have the meaning ascribed to it in Section 7(a) of this Agreement.

(ddd) “ Intangible Property ” shall mean all of Wolf’s right, title and interest in and to all intangible property in the possession or control of Wolf and used in connection with the Contributed Hotels, including without limitation, all licenses and permits (but specifically excluding any and all licenses and permits to sell alcohol and all intangible property to be licensed to the Partnership, SPE Owners and/or Tenants pursuant to the License Agreements, as hereinafter defined), approvals, authorizations and other entitlements, all guaranties and warranties related to the Contributed Hotels or the construction, fabrication or maintenance thereof, all plans and specifications relating to the improvements relating thereto and any landscaping, all tradenames, logos, telephone numbers, websites and domains (including access to FTP file content) and signage rights used by Wolf in connection with the operation of the Contributed Hotels, and all books, records, reports, test results, environmental assessments, surveys and other documents and materials related to Wolf’s operation of the Contributed Hotels and Wolf’s construction, maintenance and repair of the Property.

(eee) “ Interim Beverage Facilities Management Agreement ” shall mean the agreement in the form attached hereto as Exhibit “N” pursuant to which Wolf Dells and Wolf Sandusky will manage the alcoholic beverage facilities at the Dells Hotel and Sandusky Hotel, respectively, on an interim basis.

(fff) “ Inventory ” shall mean all inventory located at the Contributed Hotels, including without limitation, the Operating Supplies, all food and beverages (other than unopened inventory and subject to any legal restrictions pertaining to the sale or transfer of alcoholic beverages), engineering, maintenance and housekeeping supplies, including soap and cleaning material and fuel, stationery and printing items and supplies, other supplies of all kinds, whether used, unused or held in reserve storage for future use in connection with the maintenance and operation of the Contributed Hotels, together with any additions thereto prior to the Closing Date and subject to depletion, resupply, substitution, replacement and disposition in the ordinary course of business.

(ggg) “ Knowledge ” shall mean, (i) with respect to Wolf, the actual knowledge of Hernan Martinez, Michael Schroeder, Joe Walsh, Arif Qureshi and Kim Schaefer as of the date of this Agreement, and (ii) with respect to CNL, the actual knowledge of Charlie Muller, Tammie Quinlan, Bob Yow, Matt Ragsdale and Dawn Worth as of the date of this Agreement.

(hhh) “ Leases ” shall mean those certain lease agreements to be entered into at Closing by and between each SPE Owner and wholly-owned subsidiary Affiliates of the Partnership (which shall be taxable REIT subsidiaries) for each of the Contributed Hotels (individually a “ Tenant ,” or collectively, the “ Tenants ”). The Leases shall be in substantially the form negotiated by the parties as of the date hereof.

(iii) “ License Agreements ” shall mean those certain license agreements to be entered into at Closing by and between Great Lakes Services, LLC, an Affiliate of Wolf, and the applicable Tenant for each of the Contributed Hotels for the purpose of licensing to Tenants the right to use the name “Great Wolf Hotel” in connection with the operation of the Contributed Hotels. The License Agreements shall be in substantially the form negotiated by the parties as of the date hereof.

(jjj) “ Liquor Licenses ” shall have the meaning ascribed to it in Section 14 of this Agreement.

(kkk) “ Management Agreements ” shall mean those certain management agreements to be entered into at Closing by and between Great Lakes Services, LLC, an Affiliate of Wolf, and the applicable Tenant for each of the Contributed Hotels. The Management Agreements shall be in substantially the form negotiated by the parties as of the date hereof.

(lll) “ Managers ” shall have the meaning ascribed to it in Section 14 of this Agreement.

(mmm) “ Non-Defaulting Party ” shall have the meaning ascribed to it in Section 12 of this Agreement.

(nnn) “ Operating Agreements ” shall mean all contracts, agreements, leases (including, but not limited to, commercial leases and equipment leases), maintenance agreements and service contracts, to which Wolf is a party, which are in effect on the Closing Date and which relate to the ownership and/or operation of the Contributed Hotels, including, without limitation, any such agreements as are listed in Exhibit “R” annexed to this Agreement and incorporated herein by this reference, but excluding the Rental Management Agreements and such other agreements as are acceptable to or rejected by the Tenants.

(ooo) “ Operating Supplies ” shall mean any and all operating supplies, whether consumables or non-consumables, used or consumed in the ordinary course of business at the Contributed Hotels and owned by Wolf, including without limitation, paper products, soap, cleaning supplies, food, and alcoholic and non-alcoholic beverages.

(ppp) “ Operations Settlement ” shall mean a final accounting prepared by Wolf’s and CNL’s accountants in the period between eight o’clock p.m. (local time) on the day prior to the Closing Date and eight o’clock a.m. (local time) on the Closing Date, the results of which shall be incorporated into the closing statement.

(qqq) “ Other Revenues ” shall mean all revenues earned by Wolf from the operation of the Contributed Hotels other than Room Revenues, including, without limitation, revenues from the sale of food, the sale of alcoholic and nonalcoholic beverages, rental of meeting and banquet rooms, arcade revenues, revenues from Wiley’s Woods, telephone sales, pay television sales, valet and parking services, spa lease rent, gift shop revenues and other similar revenues, together with any sales tax or other taxes thereon.

(rrr) “ Outside Closing Date ” shall mean December 31, 2005 or such other date as mutually agreed to in writing by the parties hereto.

(sss) “ Partnership ” shall have the meaning ascribed to it in Recital D of this Agreement.

(ttt) “ Partnership Agreement ” shall have the meaning ascribed to it in Recital D of this Agreement.

(uuu) “ Permitted Exceptions ” shall mean any and all (i) restrictions, easements, reservations, covenants and other matters set forth as exceptions to title in the Title Commitments (but not including Title Defects cured pursuant to Article 7 hereof) and zoning and land use ordinances and laws of any Governmental Authority (except for monetary liens, mortgages and encumbrances which shall be paid by Wolf prior to Closing and other matters to be cured by Wolf pursuant to this Agreement); (ii) general taxes and assessments for the year of the Closing and thereafter, and special taxes and assessments first becoming due and payable after the Closing Date; (iii) matters disclosed or indicated by or shown on a Survey or any update thereto which are acceptable to the Partnership and SPE Owners; (iv) leases and tenancies in writing for any areas of the Contributed Hotels which are to be assumed by the Partnership; and (v) liens, mortgages and encumbrances created by the Partnership.

(vvv) “ Personal Property ” shall mean all furniture, furnishings, fixtures, equipment, vehicles, machinery, appliances, dishes, utensils, cookware, materials, Inventory and other personal property, located at the Contributed Hotels, owned by Wolf or any Affiliate thereof, and used in connection with the operation of the Contributed Hotels, but specifically excluding any such items leased by Wolf or any of its Affiliates from a third-party pursuant to written lease agreements which are more particularly described on Exhibit “S” attached hereto and by this reference incorporated herein.

(www) “ Person ” shall mean any individual or Entity, and the heirs, executors, administrators, legal representatives, successors and assigns of such Person where the context so admits.

(xxx) “ Post Closing Environmental Matter ” shall have the meaning ascribed to it in Section 7(d(ii) of this Agreement.

(yyy) “ Property ” shall mean the Dells Hotel, the Sandusky Hotel, the Commercial Condominium Unit, the Personal Property and the Intangible Property.

(zzz) “ Property Information ” shall have the meaning ascribed to it in Section 7(a) of this Agreement.

(aaaa) “ Purchase Price ” shall mean that payment by CNL pursuant to which CNL funds the acquisition of its interest in the Partnership and Tenants. The Purchase Price shall be calculated by multiplying the Contribution Value of the Property and the percentage interest in the Partnership and Tenants that CNL is acquiring as of the Closing Date.

(bbbb) “ Remediation ” shall mean any and all activities required by Governmental Authorities to identify, assess, test, characterize, sample, clean up, remove, neutralize, abate, or stabilize Environmental Matters at a particular site and/or to dispose of any Hazardous Substance and/or any material containing any Hazardous Substance, including, without limitation, Environmental Matters assessment, testing, sampling, quality control, modeling, consultants’ analyses and reports, laboratory work, field tests, system installation, modification, operation, and maintenance, acquisition of equipment, contract negotiation and execution, contract development and bidding, monitoring, transportation, and disposal.

(cccc) “ Rental Management Agreements ” shall mean those certain rental management agreements more particularly identified and listed on Exhibit “T” attached hereto and incorporated herein by this reference pursuant to which Wolf Dells manages the rental of the condominium units known as Great Wolf Lodge Condominium and located on certain real property lying adjacent and contiguous to the Dells Land as more particularly described on Exhibit “U” attached hereto, all as more particularly described in the Rental Management Agreements.

(dddd) “ Room Revenues ” shall mean all revenues from the rental of guest rooms of the Contributed Hotels and from fees/revenues associated with the use of the Contributed Hotels by occupants of the Great Wolf Lodge Condominium, together with any and all sales or other taxes thereon.

(eeee) “ Sandusky Hotel ” shall have the meaning ascribed to it in Recital A of this Agreement.

(ffff) “ Sandusky Improvements ” shall have the meaning ascribed to it in Recital A of this Agreement.

(gggg) “ Sandusky Land ” shall have the meaning ascribed to it in Recital A of this Agreement.

(hhhh) “ SPE Owner ” or “ SPE Owners ” shall have the meanings ascribed to them in Recital C of this Agreement.

(iiii) “ Surveys ” shall have the meaning ascribed to it in Section 7(c) of this Agreement.

(jjjj) “ Tall Pines Agreement ” shall mean that certain Tall Pines Royalty and Exclusive License Agreement entered into by and between Tall Pines Development Corporation, a Wisconsin corporation and The Great Lakes Companies, Inc., a Wisconsin corporation (to whose interest Great Lakes Services, LLC succeeded to by merger) and effectively dated July 26, 2004.

(kkkk) “ Tall Pines Acknowledgement Enforcement Agreement ” shall mean that certain Tall Pines Acknowledgement Enforcement Agreement in the form attached hereto as Exhibit “V” and by this reference incorporated herein.

(llll) “ Tenant ” shall have the meaning ascribed to it in Section 2(hhh) of this Agreement.

(mmmm) “ Third-Party Estoppels ” shall have the meaning ascribed to it in Section 9(h) of this Agreement.

(nnnn) “ Title Commitments ” shall mean the commitments of title insurance issued by Title Company and provided to CNL with respect to each parcel comprising the Contributed Hotels pursuant to this Agreement. The Title Commitments shall be endorsed at Closing in favor of the applicable SPE Owners. Each of the Title Commitments is at times herein referred to as a “Title Commitment”.

(oooo) “ Title Company ” shall mean First American Title Insurance Company through the Talon Group, Orlando Commercial Services Division, a division of First American Title Insurance Company, whose address is 111 North Orange Avenue, Suite 1285, Orlando, Florida 32801, Attention: Michael Moore.

(pppp) “ Title Defects ” shall have the meaning ascribed to it in Section 7(b) of this Agreement.

(qqqq) “ Title Policies ” shall mean the owner’s policies of title insurance to be issued to the Partnership or the SPE Owners pursuant to the terms of the Title Commitments and this Agreement. Each of the Title Policies is at times herein referred to as a “Title Policy”.

(rrrr) “ Tray Ledgers ” shall mean any accounts receivable of registered guests who have not checked out and who are occupying rooms on the evening prior to, and the morning of, the Closing Date.

(ssss) “ Wolf ” shall have the meaning ascribed to it in the first paragraph of this Agreement.

(tttt) “ Wolf’s Closing Deliveries ” shall have the meaning ascribed to it in Section 10(c) of this Agreement.

(uuuu) “ Wolf’s Closing Conditions ” shall have the meaning ascribed to it in Section 5(c) of this Agreement.

(vvvv) “ Wolf’s Closing Conditions Failure ” shall have the meaning ascribed to it in Section 5(d) of this Agreement.

(wwww) “ Wolf Dells ” shall have the meaning ascribed to it in the first paragraph of this Agreement.

(xxxx) “ Wolf Parent ” shall have the meaning ascribed to it in the first paragraph of this Agreement.

(yyyy) “ Wolf Partner(s) ” shall have the meaning ascribed to it in Section 6 of this Agreement.

(zzzz) “ Wolf Sandusky ” shall have the meaning ascribed to it in the first paragraph of this Agreement.

3.  Contribution to the Partnership. Subject to the terms, provisions and conditions set forth herein:

(a) Wolf shall contribute the Property to the Partnership, the SPE Owners and/or the applicable Tenants.

(b) The parties acknowledge that CNL shall be required to obtain no less than a fifty-one percent (51%) interest in the Partnership and the Tenants as of the Closing Date, but shall be entitled, at its election, to obtain up to a seventy percent (70%) interest in the Partnership and the Tenants on the Closing Date pursuant to the terms of this Agreement, and shall acquire additional interests so as to attain a seventy percent (70%) interest in the Partnership and the Tenants after the Closing Date pursuant to the terms of the Partnership Agreement.

(c) CNL shall pay the Purchase Price to Wolf or the Wolf Partner(s), as Wolf directs, at Closing subject to the adjustments and prorations set forth herein.

4.  Contribution Value of the Property.

(a) The Contribution Value of the Dells Hotel, that portion of the Personal Property and Intangible Property associated therewith, and the Commercial Condominium Unit is Sixty Million and No/100 Dollars ($60,000,000.00).

(b) The Contribution Value of the Sandusky Hotel and that portion of the Personal Property and Intangible Property associated therewith is Fifty-Four Million Five Hundred Thousand and No/100 Dollars ($54,500,000.00).

(c) The parties hereto agree that the Contribution Value associated with each of the Contributed Hotels shall be allocated between real and personal property as agreed to by the parties and determined during the Inspection Period (as defined in Section 7(a) hereof). Each Tenant shall take title to all Personal Property relating to the indoor and outdoor water park components of each of the Contributed Hotels together with such other Personal Property (as determined by the parties) such that Each SPE Owner shall receive and become the owner of Personal Property of no greater value than thirteen percent (13%) of the Contribution Value of the applicable Contributed Hotel and such that applicable Tenant shall receive and become the Owner of the remaining Personal Property.

(d) At the Closing, CNL shall pay or cause to be paid to Wolf or the Wolf Partner(s), as directed by Wolf, by wire transfer an amount equal to the Purchase Price (as adjusted pursuant hereto). CNL shall cause the wire transfer of funds to be delivered to the Escrow Agent no later than 5:00 p.m. (Eastern Time) on the Closing Date. All amounts to be paid by CNL to the Escrow Agent pursuant to this Agreement shall be paid by wire transfer of immediately available U.S. federal funds.

5.  Conditions Precedent . The following conditions precedent (the “ Closing Conditions ”), as set forth below, shall be fully satisfied, or waived by the parties hereto, as applicable, on even date with, or before the applicable party is obligated to fund its contributions as required by and provided in this Agreement and in the Partnership Agreement:

(a)  CNL’s Closing Conditions . CNL’s obligations to close the transactions described in this Agreement are subject to the satisfaction at or prior to Closing of the following conditions precedent (“ CNL’s Closing Conditions ”):

(i) Wolf’s Deliveries . All of Wolf’s Closing Deliveries (as defined in Section 10(c) hereof) shall have been delivered to CNL or deposited with Escrow Agent to be delivered to CNL or the Partnership at Closing.

(ii) Representations and Warranties . The representations or warranties of Wolf in this Agreement shall be true and correct in all material respects as of the Closing (or as such other date to which such representation and warranties expressly were made).

(iii) Covenants and Obligations . The covenants and obligations of Wolf in this Agreement shall have been performed in all material respects.

(iv) Title Policy . The Title Company shall have irrevocably committed to issue the Title Policies pursuant to Article 7 hereof with all standard exceptions deleted and all requirements for issuance of the Title Policies satisfied and deleted.

(v) Change in Environmental Condition of Property . No event shall have occurred following the date of this Agreement and prior to the Closing Date which would result in a violation of any Environmental Law.

(vi) Adverse Proceedings . No litigation or other court action shall have been commenced seeking to obtain an injunction or other relief from such court to enjoin the consummation of the transactions described in this Agreement, and no preliminary or permanent injunction or other order, decree or ruling shall have been issued by a court of competent jurisdiction or by any Governmental Authority that would make illegal or invalid or otherwise prevent the consummation of the transactions described in this Agreement.

(vii) Adverse Law . No law shall have been enacted that would make illegal or invalid or otherwise prevent the consummation of the transactions described in this Agreement.

(viii) Operating Agreements; Rental Management Agreements . There shall be no material default by Wolf or any Affiliate of Wolf under any of the material Operating Agreements or Rental Management Agreements.

(ix) Due Diligence Matters . The matters set forth on Exhibit “W” attached hereto and by this reference incorporated herein shall have been resolved to the reasonable satisfaction of CNL as of or prior to Closing.

(b)  Failure of Any CNL’s Closing Condition . If any of CNL’s Closing Conditions is not satisfied as of the Closing (a “ CNL Closing Condition Failure ”), then CNL shall have the right, in CNL’s absolute discretion, to either (i) terminate this Agreement by providing written notice to Wolf, in which case, except as otherwise set forth herein, the parties hereto shall have no further rights or obligations under this Agreement, except those which expressly survive such termination, or (ii) complete the transactions set out herein, without prejudice to any right or remedy of CNL in respect thereof provided for herein. If CNL terminates this Agreement because one or more of the conditions precedent to its obligation to close the transactions described in this Agreement set forth in Section 5(a)(i), Section 5(a)(ii), Section 5(a)(iii), or Section 5(a)(viii) is not satisfied, or one or more of the conditions precedent set forth in Section 5(a)(iv), Section 5(a)(v), Section 5(a)(vi), Section 5(a)(vii), or Section 5(a)(ix) is not satisfied as the result of the action or a failure to act by Wolf, and provided that the Wolf’s Closing Conditions set forth in Section 5(c)(iii) and 5(c)(iv) are satisfied, then Wolf shall reimburse CNL for all out-of-pocket expenses incurred by CNL in connection with the transactions contemplated by this Agreement; provided, however that Wolf’s obligation to reimburse CNL under this Section 5 and Sections 7(b) and 7(d) shall not exceed the sum of Two Hundred Thousand and No/100 Dollars ($200,000.00) in the aggregate.

(c)  Wolf’s Closing Conditions . Wolf’s obligations to close the transactions contemplated in this Agreement are subject to the satisfaction at or prior to Closing of the following conditions precedent (the “ Wolf’s Closing Conditions ”):

(i) Receipt of the Purchase Price . CNL shall have paid to the Partnership or deposited with Escrow Agent, with irrevocable written direction to disburse the same to the Partnership, the Purchase Price (as adjusted for prorations pursuant hereto).

(ii) CNL’s Deliveries . All of CNL’s Closing Deliveries (as defined in Section 10(d) hereof) shall have been delivered to Wolf or the Partnership or deposited with Title Company, as escrow agent, to be delivered to Wolf or the Partnership at Closing.

(iii) Representations and Warranties . The representations and warranties of CNL in this Agreement shall be true and correct in all material respects as of the Closing (or as of such other date to which such representation or warranty expressly is made).

(iv) Covenants and Obligations . The covenants and obligations of CNL in this Agreement shall have been performed in all material respects.

(v) Adverse Proceedings . No litigation or other court action shall have been commenced seeking to obtain an injunction or other relief from such court to enjoin the consummation of the transactions described in this Agreement, and no preliminary or permanent injunction or other order, decree or ruling shall have been issued by a court of competent jurisdiction or by any Governmental Authority that would make illegal or invalid or otherwise prevent the consummation of the transactions described in this Agreement.

(vi) Adverse Law . No law shall have been enacted that would make illegal or invalid or otherwise prevent the consummation of the transactions described in this Agreement.

(d)  Failure of Wolf’s Closing Conditions . If any of Wolf’s Closing Conditions is not satisfied at the Closing (a “ Wolf’s Closing Condition Failure ”), then Wolf shall have the right, in Wolf’s absolute discretion, to either (i) terminate this Agreement by providing written notice to CNL, in which case, except as otherwise set forth herein, the parties hereto shall have no further rights or obligations under this Agreement, except those which expressly survive the termination, or (ii) complete the transactions set out herein, without prejudice to any right or remedy of Wolf in respect thereof provided for herein. If Wolf terminates this Agreement because one or more of the conditions precedent to its obligation to close the transactions described in this Agreement set forth in Section 5(c)(i), Section 5(c)(ii), Section 5(c)(iii), or Section 5(c)(iv) is not satisfied, or one or more of the conditions precedent set forth in Section 5(c)(v) or Section 5(c)(vi) is not satisfied as the result of the action or a failure to act by CNL and provided that the CNL’s Closing Conditions set forth in Section 5(a)(ii), 5(a)(iii) and 5(a)(viii) are satisfied as of the Closing, then CNL shall reimburse Wolf for all out-of-pocket expenses incurred by Wolf in connection with the transactions contemplated by this Agreement; provided, however that CNL’s obligation to reimburse Wolf under this Section 5 shall not exceed the sum of Fifty Thousand and No/100 Dollars ($50,000.00).

6.  Requirements Upon Satisfaction of Closing Conditions . CNL and Wolf hereby agree that if all of the Closing Conditions have been timely met or waived as set forth herein on or before the Closing Date, then each of Wolf, or Wolf’s designated Affiliate(s) (the “ Wolf Partner(s) ”) shall contribute the Property to the Partnership, the SPE Owners and/or the applicable Tenants, and each of CNL, or CNL’s designated Affiliate(s) (the “ CNL Partner(s) ”) shall make such payments to Wolf or the Wolf Partner(s), as Wolf may designate, all as contemplated herein, so as to give effect to the transactions contemplated hereby and to cause the general and limited partnership interests of the CNL Partner(s) in the Partnership and Tenants after such payment to be equal to, or, at the election of CNL pursuant to Article 3 hereof, greater than fifty-one percent (51%) of the total partnership interests in the Partnership and Tenants, and the limited partner interests of the Wolf Partner(s) in the Partnership and Tenants after such contributions to be equal to, or, at the election of CNL pursuant to Article 3 hereof, less than forty-nine percent (49%) of the partnership interests in the Partnership and Tenants.

7.  CNL Due Diligence with Respect to Contributed Hotels .

(a) CNL’s Inspections . On or before the Effective Date of this Agreement, Wolf agrees to provide to CNL true and complete copies of all documents, studies, reports and other materials reasonably requested by CNL that relate to the Property and are in the possession or control of Wolf or any of Wolf’s Affiliates or currently retained consultants (the “ Property Information ”); provided, however, that in no event shall Wolf be required to provide information protected by attorney-client privilege, attorney work product, confidential reports prepared for solely investors or financial projections distributed for internal use by Wolf. Wolf represents that all Property Information delivered to CNL will be, upon delivery thereof, to CNL true, complete and correct in all material respects. CNL and its officers, employees, agents and consultants shall have the period commencing on the Effective Date and terminating at 5:00 p.m. on the Closing Date (the “ Inspection Period ”), in which to undertake such physical inspections and other investigations of and concerning the Property, including surveys, soil borings, percolation, engineering studies and other tests as CNL and its consultants deem reasonably necessary to (i) review and evaluate the physical characteristics of the Property and to perform certain work or inspections in connection with such evaluation; (ii) review and evaluate all existing permits and licenses, existing development entitlements, vested rights, contracts, agreements, obligations and similar matters applicable to the Property; (iii) determine and evaluate any pending and threatened litigation and claims with respect to the Property; (iv) determine compliance of the Property with all applicable laws, rules and regulations; and (v) determine the suitability, in CNL’s sole and absolute discretion, of the Property for the Business Purpose; provided, however, (A) that any such activities that take place on the Property shall be done with reasonable prior notice and at reasonable times, (B) the employees and agents of CNL that enter the Property for the purposes of conducting due diligence with respect to the Property, and the activities conducted by CNL, must be insured by CNL, (C) all employees or agents of CNL that enter the Property must be accompanied by an employee of Wolf during the conduct of any due diligence activities on the Property and must conduct themselves so as to minimize any disturbance to the conduct of Wolf’s business on the Property in its ordinary course, (D) any such physical testing of the Property, such as soil borings, must be approved in advance by Wolf, (E) CNL will provide to Wolf a copy of each third-party report received by CNL in the course of its due diligence investigation of the Property, and (F) CNL will not have any discussions with any employee of Wolf or any of its Affiliates without the prior consent of Wolf. Inspections related to Environmental Matters shall be further subject to the provisions of Section 7(d) below. The cost of all such investigations shall be borne by each party in equal proportion to their interest in the Partnership as of Closing. CNL shall be liable for all costs and expenses, and/or damage or injury to any person or property resulting from any such inspection, whether occasioned by the acts of CNL or any of its employees, agents, contractors, consultants or representatives, and CNL shall save, insure, defend, indemnify and hold harmless Wolf from any loss, cost, liability, claims and expenses (including, without limitation, mechanic’s liens and/or reasonable attorneys’ fees and costs) resulting therefrom; provided, however such indemnity shall not apply to any loss, cost, liability, claims or expenses arising as a result of Wolf’s negligence. CNL shall restore the Property to substantially the same condition as it existed prior to CNL’s activities. The obligations of CNL set forth in this Paragraph shall survive the Closing or the termination of this Agreement.

(b) Title . As of the Effective Date of this Agreement, Wolf has provided to CNL for review, a copy of Wolf’s existing title insurance policies (the “ Existing Title Policies ”) relating to the Contributed Hotels. CNL has, as of the Effective Date, obtained and delivered to Wolf the Title Commitments issued by the Title Company. The Title Commitments evidence that title to the Dells Hotel is vested in Wolf Dells and that title to the Sandusky Hotel is vested in Wolf Sandusky and that the Contributed Hotels are free and clear of all liens, encumbrances, exceptions or qualifications whatsoever, except for Permitted Exceptions. Legible copies of all exceptions set forth on the Title Commitments have been provided to CNL as of the Effective Date. The Title Commitments also evidence that, upon the execution, delivery and recording of the Deeds and the satisfaction of all requirements specified in Schedule B, Section I of the Title Commitments, the applicable SPE Owners shall acquire fee simple title to the Contributed Hotels and the Commercial Condominium Unit, subject only to the Permitted Exceptions. CNL has reviewed the Existing Title Policies delivered by Wolf to CNL, and the Title Commitments obtained by CNL pursuant to this Paragraph, and notified Wolf in writing specifying those liens, encumbrances, exceptions or qualifications to title which are unacceptable to CNL (such liens, encumbrances, exceptions or qualifications being hereinafter referred to together with any title matter created or permitted to be created by Wolf after the Effective Date and objected to by CNL, and together with any title matter of which Wolf had Knowledge but which Wolf did not disclose as of the Effective Date and objected to by CNL, as “ Title Defects ”). Wolf shall cure the Title Defects before the Closing Date (the “ Cure Period ”), to the satisfaction of CNL and the Title Company in such manner as to permit the Title Company to endorse the Title Commitments so as to delete the Title Defects therefrom. If Wolf shall in fact cure the Title Defects within the Cure Period, the obligations and rights of the parties to close shall be unaffected by the eliminated Title Defects. If Wolf is unable to cure or eliminate the Title Defects within the Cure Period, CNL may elect to terminate this Agreement by giving written notice of termination to Wolf on or before the Closing Date, or, alternatively, CNL may elect to waive CNL’s objections to the uncured Title Defects and consummate the transactions contemplated by this Agreement subject to the Title Defects, in which event the obligations and rights of the parties to close shall be unaffected by the waived Title Defects. If CNL elects to terminate this Agreement due to the existence of uncured Title Defects as provided in this Article 7, all rights and obligations of the parties hereunder shall terminate and be null and void, except for any rights and obligations of the parties that are to survive the termination of this Agreement as provided elsewhere herein and Wolf shall reimburse CNL for all out-of-pocket expenses incurred by CNL in connection with the transactions contemplated by this Agreement, including, without limitation, all costs and expenses associated with the investigations contemplated by Section 7(a) above, provided, however that Wolf’s obligation to reimburse CNL under this Section 7(b), Section 5 and Section 7(d) shall not exceed the sum of Two Hundred Thousand and No/100 Dollars ($200,000.00) in the aggregate.

(c) Survey . As of the Effective Date of this Agreement, Wolf has delivered to CNL, for its review, the existing surveys of the Property in the possession or control of Wolf. CNL has obtained and delivered to Wolf updated/new surveys (the “ Surveys ”) which Surveys are in a form satisfactory to the Title Company, state the dimensions, acreage and square footage of the each parcel of land comprising the Contributed Hotels, and show the location of all boundaries, encroachments, overlaps, easements and improvements thereon. CNL has reviewed the existing surveys and the Surveys and the Title Commitments and provided written comments to Wolf specifying those matters shown on the Surveys which adversely affect the title to the Contributed Hotels, and the same are deemed to be Title Defects hereunder, subject to the rights and obligations of Wolf and CNL set forth above.

(d) Environmental Matters . CNL has obtained environmental studies (including Level I studies), audits and tests of the Contributed Hotels as deemed necessary by CNL to determine the existence of any Environmental Matters on the Contributed Hotels (individually, an Environmental Report and collectively the “ Environmental Reports ”). CNL has provided written notice (an “ Environmental Notice ”) to Wolf of the existence of any Hazardous Substances on or contaminating the Property above legally permissible levels as set forth in the current Environmental Laws (together with any such matters caused by Wolf and not disclosed to CNL prior to the date hereof or with respect to which Wolf had Knowledge but did not disclose prior to the date hereof, the “ Environmental Defects ”). Wolf shall undertake a reasonable good-faith effort to cure the Environmental Defect before the Closing Date to the satisfaction of CNL; provided, however, if such Environmental Defect are not capable of being cured prior to the Closing Date, the Closing Date may be extended for up to forty-five (45) days to allow Wolf to cure such Environmental Defect. If Wolf shall in fact cure the Environmental Defect prior to Closing, the obligations and rights of the parties to close shall be unaffected by the Environmental Defect. If Wolf is unable to cure or eliminate the Environmental Defect prior to Closing, CNL may elect to terminate this Agreement by giving written notice of termination to Wolf on or before the Closing Date, or, alternatively, CNL may elect to waive CNL’s objections to the uncured Environmental Defect and consummate the transactions contemplated by this Agreement subject to the Environmental Defect, in which event the obligations and rights of the parties to close shall be unaffected by the waived Environmental Defect . If CNL elects to terminate this Agreement due to the existence of uncured Environmental Defect as provided in this Article 7, all rights and obligations of the parties hereunder shall terminate and be null and void, except for any rights and obligations of the parties that are to survive the termination of this Agreement as provided elsewhere herein and Wolf shall reimburse CNL for all out-of-pocket expenses incurred by CNL in connection with the transactions contemplated by this Agreement, including, without limitation, all costs and expenses associated with the investigations contemplated by Section 7(a) above, provided, however that Wolf’s obligation to reimburse CNL under this Section 7(d), Section 5 and Section 7(b) shall not exceed the sum of Two Hundred Thousand and No/100 Dollars ($200,000.00) in the aggregate. If the Environmental Reports disclose information which would require reporting of such information to a Governmental Authority, as required under applicable Environmental Laws, Wolf agrees that it shall make any and all such reports to the extent required by applicable Environmental Laws, and that CNL shall not be obligated to do so. If Wolf fails to make any and all such reports t