AGREEMENT OF PURCHASE AND SALE

EXHIBIT 10.1

AGREEMENT OF PURCHASE AND SALE

by and among

GAYLORD ENTERTAINMENT COMPANY ,
a Delaware corporation

(“ Purchaser ”),

LCWW PARTNERS ,
a Texas joint venture (“ LCWW ”)

and

LA CANTERA DEVELOPMENT COMPANY ,
a Delaware corporation

(“ La Cantera Development Co. ”; LCWW and La Cantera Development Co. are collectively
referred to as “ Sellers ” and each is sometimes individually referred to as a “ Seller ”)

WESTIN LA CANTERA RESORT, SAN ANTONIO, TEXAS

TABLE OF CONTENTS

		Page
ARTICLE I DEFINITIONS			1
1.1 Definitions			1
ARTICLE II PURCHASE AND SALE; INITIAL DEPOSIT; ADDITIONAL DEPOSIT; PAYMENT OF PURCHASE PRICE; STUDY PERIOD			10
2.1 Purchase and Sale			10
2.2 Payment of Purchase Price			10
2.3 Initial Deposit; Additional Deposit			11
2.4 Study Period			12
ARTICLE III SELLERS’ REPRESENTATIONS AND WARRANTIES			18
3.1 Organization and Power			19
3.2 Authorization and Execution			19
3.3 Non-contravention			19
3.4 No Special Taxes			19
3.5 Compliance with Existing Laws			19
3.6 Management Agreement/Operating Agreements			19
3.7 Insurance			20
3.8 Condemnation Proceedings; Roadways			20
3.9 Actions or Proceedings			20
3.10 Labor and Employment			20
3.11 Financial Information			20
3.12 Occupancy Agreements			20
3.13 Americans With Disabilities Act			21
3.14 No Commitments			21
3.15 Sellers are Not “Foreign Persons”			21
3.16 Litigation			21
3.17 Liquor License			21
3.18 Taxes			21
3.19 Title to Personal Property			22
3.20 Environmental Matters			22
3.21 Bankruptcy			22
3.22 Right to Purchase			22
3.23 Submission Matters			22
3.24 Permitted Exceptions			22
3.25 Patriot Act			22
3.26 Other Agreements			23
3.27 Labor and Employment			23
3.28 LIMITATION ON SELLERS’ REPRESENTATIONS AND WARRANTIES			24
ARTICLE IV PURCHASER’S REPRESENTATIONS AND WARRANTIES			25
4.1 Organization and Power			25
4.2 Authorization and Execution			25

		Page
4.3 Non-Contravention			25
4.4 Litigation			25
4.5 Patriot Act			25
ARTICLE V CONDITIONS PRECEDENT			26
5.1 As to Purchaser’s Obligations			26
5.2 As to Sellers’ Obligations			27
ARTICLE VI COVENANTS OF SELLERS AND PURCHASER			27
6.1 Operating Agreements/Occupancy Agreements/Leased Property Agreements/Off-Site Facility Agreements			27
6.2 Warranties and Guaranties			28
6.3 Insurance			28
6.4 Operation of Property Prior to Closing			28
6.5 Exclusivity			29
6.6 Termination of Hotel Employees; WARN Act			29
6.7 Employee Claims			29
6.8 COBRA Requirements			31
6.9 Reasonable Inspection After Closing			32
6.10 Meeting Room			32
6.11 Proprietary Property			32
ARTICLE VII CLOSING			33
7.1 Closing			33
7.2 Sellers’ Deliveries			33
7.3 Purchaser’s Deliveries			35
7.4 Additional Deliveries			35
7.5 Closing Costs			36
7.6 Revenue and Expense Allocations			37
7.7 Safe Deposit Boxes			40
7.8 Inventory of Baggage			40
7.9 Acquisition and Payment for Inventory			40
7.10 Assumption			41
ARTICLE VIII GENERAL PROVISIONS			41
8.1 Fire or Other Casualty			41
8.2 Condemnation			42
8.3 Broker			43
8.4 Tax Clearance Certificates			43
8.5 Confidentiality			43
8.6 Liquor Licenses			45
8.7 Sellers’ Accounts Receivable			45
8.8 Cooperation on Tax Matters.			46
8.9 SEC Filings.			46
ARTICLE IX DEFAULT; TERMINATION RIGHTS			46
9.1 Default by Sellers/Failure of Conditions Precedent			46
9.2 Default by Purchaser/Failure of Conditions Precedent			47
9.3 Costs and Attorneys’ Fees			48

		Page
9.4 Limitation of Liability			48
ARTICLE X MISCELLANEOUS PROVISIONS			48
10.1 Completeness; Termination of Access Agreement; Modification			48
10.2 Assignments			48
10.3 Successors and Assigns			49
10.4 Days			49
10.5 Governing Law			49
10.6 Counterparts			49
10.7 Severability			49
10.8 Costs			49
10.9 Notices			49
10.10 Escrow Agent			50
10.11 Incorporation by Reference			51
10.12 Survival			51
10.13 Further Assurances			52
10.15 Time of Essence			52
10.16 Signatory Exculpation			52
10.17 Rules of Construction			52
10.18 No Recording			53
10.19 Facsimile or Electronic Signatures			53
10.20 Effective Date			53
10.21 Tax Deferred Exchange			53
10.22 Survival			53
10.23 Architectural Issues			54

AGREEMENT OF PURCHASE AND SALE

     THIS AGREEMENT OF PURCHASE AND SALE (this “ Agreement ”) is made as of the Effective Date, by and between GAYLORD ENTERTAINMENT COMPANY, a Delaware corporation (“ Purchaser ”), LCWW PARTNERS, a Texas joint venture (“ LCWW ”), and LA CANTERA DEVELOPMENT COMPANY, a Delaware corporation (“ La Cantera Development Co. ”; LCWW and La Cantera Development Co. are collectively referred to as “ Sellers ” and individually referred to as “ Seller ”).

     A. Sellers are the owners of those certain parcels of real property depicted on Exhibit A attached hereto situated, lying and being in San Antonio, Bexar County, Texas, together with the improvements situated thereon operated by Sellers known as the Westin La Cantera Resort and including (x) the two (2) golf courses commonly known as the Resort Course at La Cantera and The Palmer Course at La Cantera and located on such real property (with the hotel and the two (2) golf courses being herein collectively referred to as the “ Hotel ”) and (y) that certain approximately 57.5 acre tract depicted as Tract F-1 on Exhibit A (“ Tract F-1 ”) and that certain approximately 30.5 acre tract depicted as Tract F-3A on Exhibit A (“ Tract F-3A ”; Tract F-1 and Tract F-3A are herein sometimes individually referred to as an “ Undeveloped Tract ” and collectively referred to as the “ Undeveloped Tracts ”).

     B. Purchaser is desirous of purchasing such real property and the Hotel from Sellers and Sellers are desirous of selling such property to Purchaser, for the purchase price and upon the terms and conditions hereinafter set forth.

      NOW , THEREFORE , in consideration of the mutual covenants, promises and undertakings of the parties hereinafter set forth, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties, it is agreed:

ARTICLE I
DEFINITIONS

     1.1 Definitions . The following terms shall have the indicated meanings:

          “ Acquisition Target ” shall have the meaning ascribed such term in Section 8.5 hereof.

          “ Additional Deposit ” shall mean the additional sum of $5,000,000.00 deposited with Escrow Agent by Purchaser at the end of the Study Period pursuant to Section 2.3 hereof, plus all interest or other earnings that may accrue thereon.

          “ Advance Bookings ” shall mean reservations and agreements made or entered into by Sellers or Manager in the ordinary course of business prior to Closing and assumed by Purchaser for hotel rooms or meeting rooms to be utilized after Closing, or for catering services or other hotel or golf services to be provided after Closing at or by the Hotel.

          “ Affiliate ” of a Person shall mean (i) any other Person that is directly or indirectly (through one or more intermediaries) controlled by, under common control with, or controlling such Person, or (ii) any other Person in which such Person has a direct or indirect equity interest constituting at least a majority interest of the total equity of such other Person. For purposes of this definition, “control” shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of any Person or the power to veto major policy decisions of any Person, whether through the ownership of voting securities, by contract or otherwise.

          “ Annexation Agreement ” shall have the meaning ascribed to such term in Section 2.4(e) hereof.

          “ Applicable Laws ” shall mean any applicable building, zoning, subdivision, environmental, health, safety or other governmental laws, statutes, ordinances, resolutions, rules, codes, regulations, orders or determinations of any Governmental Authority or of any insurance boards of underwriters (or other body exercising similar functions), or any restrictive covenants or deed restrictions affecting the Property or the ownership, operation, use, maintenance or condition thereof, including, without limitation, all Environmental Laws.

          “ Approval Standard ” shall have the meaning ascribed to such term in Section 6.1 hereof.

          “ Assignment and Assumption Agreement ” shall mean an assignment and assumption agreement in substantially the form attached hereto as Exhibit E whereby Sellers assign and Purchaser assumes all of Sellers’ right, title and interest in and to the Operating Agreements, the Leased Property Agreements and the Off-Site Facility Agreements that have not been terminated prior to Closing in accordance herewith, to which either Seller is a party.

          “ Assignment of Occupancy Agreements ” shall mean an assignment agreement in substantially the form attached hereto as Exhibit F whereby Sellers assign and Purchaser assumes all of its or their right, title and interest in and to the Occupancy Agreements.

          “ Authorizations ” shall mean all licenses, permits, consents, authorizations, approvals, registrations, and certificates issued or required by any governmental or quasi-governmental agency, body, department, commission, board, bureau, instrumentality or office, or otherwise appropriate with respect to the construction, ownership, operation, leasing, maintenance, or use of the Property or any part thereof.

          “ Bill of Sale ” shall mean a bill of sale in substantially the form attached hereto as Exhibit D whereby Sellers convey their respective right, title and interest in and to the Personal Property (other than Leased Property) to Purchaser, together with any Warranties and Guaranties related thereto.

          “ Closing ” shall mean the consummation of the purchase and sale of the Property pursuant to this Agreement and shall be deemed to occur on the Closing Date.

          “ Closing Date ” shall mean the date on which the Closing shall occur, which date shall be a date after January 1, 2008 and not later than January 31, 2008 (subject to extension as

provided in this Agreement), selected by Seller with at least ten (10) days prior written notice to Purchaser, such date to be thirty-five (35) days following expiration of the Study Period if not otherwise specified by Sellers, but in any event contemporaneously with the Management Termination Date, subject to extension as provided in this Agreement.

          “ Closing Documents ” shall mean the documents defined as such in Section 7.1 hereof.

          “ Closing Obligations ” shall have the meaning ascribed thereto in Section 9.1 .

          “ COBRA ” shall have the meaning ascribed thereto in Section 6.9(a) .

          “ Code ” means the Internal Revenue Code of 1986, as amended.

          “ Commercial Covenants ” means that certain La Cantera Declaration of Commercial Covenants, Conditions and Restrictions made by La Cantera Development Co. recorded under Document No. 96-0040610 in the Official Public Records of Bexar County, Texas as amended and supplemented from time to time.

          “ Covenants, Conditions and Restrictions ” shall mean those covenants, conditions and/or restrictions (if any) binding, restricting or benefiting the Property which are set forth in the Title Commitment, including, without limitation, the Commercial Covenants.

          “ Declaration ” shall mean the Declaration of Restrictive Covenants from Sellers in substantially the form attached hereto as Exhibit H placing restrictive covenants upon the Real Property at Closing.

          “ Declarant ” shall have the meaning ascribed to such term in Section 2.4(e) hereof.

          “ Deed ” shall mean a special warranty deed from each Seller in substantially the form attached hereto as Exhibit C conveying title to the Real Property from Sellers to Purchaser.

          “ Deposit ” shall have the meaning ascribed thereto in Section 2.3 .

          “ Development Impairment ” means any event, condition or circumstance which could reasonably be expected to result in the reduction of more than fifty percent (50%) of the permitted and buildable density (in either number of units or building square footage) for the development of timeshare or non-multifamily residences on one or both of the Undeveloped Tracts from the density that would apply in the absence of such event, condition or circumstance.

          “ EDU Assignment ” means that certain Partial Assignment of Water and Sanitary Sewer Capacity attached hereto as Exhibit M .

          “ Effective Date ” (or other similar phrases such as “date of this Agreement” or “date hereof”) shall mean November 19, 2007.

          “ Environmental Condition ” means (a) any event, condition or circumstance in, at or under the Property or, in the case of any Hazardous Material, that is threatening to migrate

into, onto or under the Property, that is regulated by any Governmental Authority under any Environmental Law; or (b) any geotechnical attributes of the Property.

          “ Environmental Laws” means all applicable federal, state, local or municipal laws, rules, regulations, statutes, ordinances or orders of any Governmental Authority, relating to (a) the control of any potential pollutant, or protection of health or the air, water or land, (b) solid, gaseous or liquid waste generation, handling, treatment, storage, disposal, discharge, release, emission or transportation, (c) exposure to hazardous, toxic or other substances alleged to be harmful, (d) the protection of any threatened, endangered or at-risk plant or animal life, (e) the protection of any archeological sites, or (f) the emission, control or abatement of noise. “Environmental Laws” shall include, but not be limited to, the Clean Air Act, 42 U.S.C. § 7401 et seq., the Clean Water Act, 33 U.S.C. § 1251 et seq., the Resource Conservation Recovery Act (“ RCRA” ), 42 U.S.C. § 6901 et seq., the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq., the Endangered Species Act, 16 U.S.C. § 1531 et seq., the Safe Drinking Water Act, 42 U.S.C. § 300f et seq., and the Comprehensive Environmental Response, Compensation and Liability Act (“ CERCLA” ), 42 U.S.C. § 9601 et seq., including the Superfund Amendments and Reauthorization Act, 42 U.S.C. § 11001, et seq. The term “Environmental Laws” shall also include all applicable state, local and municipal laws, rules, regulations, statutes, ordinances and orders dealing with the subject matter of the above listed federal statutes or promulgated by any governmental or quasi-governmental agency thereunder in order to carry out the purposes of any federal, state, local or municipal law, as well as any and all federal, state, local, or municipal laws relating in any way to endangered species and similar matters.

          “ ERISA ” shall mean the Employee Retirement Income Security Act of 1974, as amended.

          “ Escrow Agent ” shall mean Fidelity National Title Insurance Company National Title Services Division, 717 North Harwood Street, Suite 800, Dallas, Texas 75201, G. Timothy Hardin, Vice President, Manager and Counsel, Telephone: 214/969-5300, Fax 214/969-5348.

          “ Executive Employees ” shall mean any General Manager, Controller, Director of Human Resources, Hotel/Room Director, Food and Beverage Director, Chief Engineer, Director of Marketing, or any other department head or member of the executive staff of the Hotel.

          “ FIRPTA Certificate ” shall mean the affidavit of Sellers under Section 1445 of the Internal Revenue Code, as amended, in substantially the form attached hereto as Exhibit G .

          “ Governmental Authority ” shall mean any federal, state, county, municipal or other government or any governmental or quasi-governmental agency, department, commission, board, bureau, office or instrumentality, foreign or domestic, or any of them.

          “ Hazardous Materials” means any (a) petroleum or petroleum products, (b) asbestos or asbestos containing materials, (c) hazardous substances as defined by § 101(14) of CERCLA and (d) any other chemical, substance or waste that is regulated by any Governmental Authority under any Environmental Law.

          “ Hotel ” shall have the definition ascribed to such term in the Recitations.

          “ Hotel Employees ” shall mean all employees of Manager or any Affiliate thereof employed at the Property.

          “ Improvements ” shall mean the Hotel and all other buildings, improvements, fixtures and other items of real estate located in, on or under the Land.

          “ Initial Deposit ” shall mean the sum of $5,000,000.00 deposited with Escrow Agent by Purchaser on or before the Effective Date pursuant to Section 2.3 hereof, plus all interest or other earnings that may accrue thereon.

          “ Insurance Policies ” shall mean all policies of insurance maintained by or on behalf of Sellers pertaining to the Property, its operation, or any part thereof.

          “ Intangible Personal Property ” shall mean, to the extent assignable, Sellers’ right, title and interest in and to all intangible personal property owned or possessed by Sellers and used in connection with the ownership or operation of the Property, including, without limitation, (1) Authorizations, (2) utility and development rights and privileges, entitlements, general intangibles, business records, plans and specifications pertaining to the Real Property and the Personal Property, (3) any unpaid award for taking by condemnation or any damage to the Land by reason of a change of grade or location of or access to any street or highway, (4) the share of the Rooms Ledger determined under Section 7.6 hereof, (5) Advance Bookings, (6) all accounts receivable being purchased by Purchaser pursuant to Section 8.7 , and (7) all prepaid expenses, petty cash and the guest ledger, in each case, to the extent Sellers are receiving a credit therefor pursuant to Section 7.6 , excluding (a) Sellers’ cash on hand, in bank accounts and invested with financial or other institutions (other than with respect to petty cash as provided in Section 7.6 ), (b) security deposits and accounts receivable, except for the above described share of the Rooms Ledger and except as provided in Sections 7.6 and 8.7 , (c) any rights to the name “Westin,” “Westin La Cantera”, “La Cantera” or any derivatives thereof, including all rights, trademarks, trademark registrations, trademark applications, copyrights, copyright registrations and copyright applications using or including such names; provided that Purchaser shall have the right to use the name “La Cantera” pursuant to that certain Trademark License Agreement attached hereto at Exhibit I (the “Trademark License Agreement”). Notwithstanding the foregoing, Manager and Sellers are retaining the right to use the customer lists of Sellers, Manager, and their Affiliates in connection with other properties owned and/or managed by Manager, Sellers and their Affiliates; provided, however, that each of Sellers and their Affiliates shall, and shall use commercially reasonable efforts to cause Manager and its Affiliates to, refrain from contacting any guests that are subject to Advance Bookings as of Closing in an attempt to transfer such guests to other properties owned and/or managed by Sellers, Manager and/or their respective Affiliates.

          “ Inventory ” shall mean all inventories of food and beverage in opened or unopened cases and all in use or reserve stock of linens, towels, brochures, paper goods, guest and office supplies, soaps, cleaning supplies, china, glass, flatware, fuel, souvenir, gift shop items and the like owned by Sellers with respect to the Hotel.

          “ Land ” shall mean those certain parcels of real estate lying and being in Bexar County, Texas, depicted on Exhibit A hereof, together with all rights, titles, benefits, easements, privileges, remainders, tenements, hereditaments, interests, reversions and appurtenances

thereunto belonging or in any way appertaining, including, without limitation, all right, title and interest of Sellers in and to water and water rights, ditches and ditch rights, well and well rights, oil, gas and other minerals rights, and all of the estate, right, title, interest, claim or demand whatsoever of Sellers, in and to adjacent strips and gores, if any, between the Land and abutting properties, and in and to adjacent streets, highways, roads, alleys or rights-of-way, and the beds thereof, either at law or in equity, in possession or expectancy, now or hereafter acquired. The Land will be more particularly described by metes and bounds in the Survey to be delivered by Sellers to Purchaser pursuant to paragraph 2.4(e) below, which description shall control for purposes of this Agreement and shall be used in the preparation of all Closing Documents.

          “ Leased Property ” shall mean all leased items of Tangible Personal Property, including, items subject to any capital lease, operating lease, financing lease, or any similar agreement.

          “ Leased Property Agreements ” shall mean the lease agreements pertaining to the Leased Property.

          “ Management Agreement ” shall mean that certain Management Contract for the Westin La Cantera Resort, San Antonio, dated October 28, 1996, between LCWW and Manager for the management or operation of the Hotel, as amended by that certain Amendment of Management Contract dated August 15, 2006.

          “ Management Termination Date ” shall mean the earlier of seventy (70) days following the Effective Date or such earlier date as Manager and Sellers may mutually agree to terminate the Management Agreement, but in no event earlier than January 10, 2008. Sellers agree to give seventy (70) days prior written notice of termination of the Management Agreement on the Effective Date substantially in the form of Exhibit N attached hereto.

          “ Manager ” shall mean Westin Hotel Management, L.P., a Delaware limited partnership.

          “ Master Covenants ” means that certain La Cantera Master Covenants and Easements made by La Cantera Development Co. recorded under Document No. 96-0037711 in the Official Public Records of Bexar County, Texas as amended and supplemented from time to time.

          “ Material Adverse Effect ” means an occurrence or circumstance that would either (i) have a material and adverse effect on the ownership of the Property or the use, ownership or operations of the Hotel as conducted on the Effective Date or (ii) result in a Development Impairment.

           “Material Structural Defect(s) ” means a defect or defects in the foundation, structural components, specifically including, the potential moisture penetration issues with respect to the exterior walls of the Hotel, or Major Systems of the Hotel Improvements that would cost in excess of $5,000,000.00 in the aggregate to repair to a good and operational condition.

           “Major Systems” means the heating, ventilation, plumbing, electrical, mechanical and other major building systems of the Hotel Improvements.

          “ Material Environmental Condition ” means any Environmental Condition(s) existing as of the Effective Date that (a) is or would be required to be remediated pursuant to Applicable Law, or would increase the cost of development (over that in the absence of such Environmental Condition) of either or both of the Undeveloped Tracts for Timeshare Development (as defined in the Declaration) or residential use, at an estimated cost in either case (including all costs, expenses, damages, losses, investigative costs, fines, penalties and potential liabilities) exceeding, in the aggregate, $500,000.00 as determined by Purchaser’s Environmental Consultant, (b) is or would be required to be remediated under Applicable Law (or would be required to be remediated under Applicable Law to permit Timeshare or residential development on either or both of the Undeveloped Tracts), and which remediation would not, in Purchaser’s Environmental Consultant’s estimation, be completed within one year of the date of Closing, or (c) constitutes or is reasonably likely to constitute a Development Impairment.

          “ Memorandum of Additional Covenants ” shall mean that certain memorandum to be executed by Declarant and recorded at Closing, which memorandum shall put future declarants on notice of the existence of the Design Guidelines and other matters set forth on Exhibit L and L-1 attached hereto, which memorandum shall be agreed upon by the Parties during the Study Period.

          “ Monetary Encumbrance Release ” shall have the meaning ascribed to such term in Section 2.4(e) hereof.

          “ Monetary Title Encumbrances ” shall mean any title encumbrances affecting the Property which are comprised of delinquent taxes, or mortgages, deeds of trust, security agreements, or other similar liens or charges including liens in the nature of those arising from judgments or pending litigation or construction, mechanics, materialmen’s or other liens or charges which are not being contested by Sellers in good faith and liens which were created or expressly assumed by Sellers) in a fixed sum (or capable of computation as a fixed sum) securing indebtedness or obligations (but not including liens against the Property evidencing the rights of third party lessors with respect to any Leased Property).

          “ Non-Breach Inaccuracy ” shall mean a breach or inaccuracy of a representation or warranty contained in Article III of this Agreement of which Sellers give Purchaser written notice prior to Closing or a Purchaser Knowledge Party otherwise obtains actual knowledge prior to Closing which does not constitute a breach or inaccuracy of any such representation or warranty made as of the Effective Date but would constitute a breach or inaccuracy of such representation or warranty if made as of the Closing Date (such as, for example, because Sellers did not have knowledge, as such term is defined in Article III , of such matters as of the Effective Date).

          “ Occupancy Agreements ” shall mean all leases, licenses, concession or occupancy agreements in effect with respect to the Real Property and/or Hotel under which any tenants (other than Hotel guests) or concessionaires occupy space upon the Real Property, including, without limitation, any antennae leases or licenses.

          “ Off-Site Facility Agreements ” shall mean any leases, contracts and agreements, if any, pertaining to facilities not located on the Property but which are required and presently used for the operation of the Hotel including, without limitation, use agreements for local golf courses, and parking or garage contracts or leases.

          “ Operating Agreements ” shall mean all service, supply, maintenance, construction, capital improvement and other similar contracts in effect with respect to the Property (other than the Occupancy Agreements, Leased Property Agreements, Off-Site Facility Agreements) related to construction, operation, or maintenance of the Property, and shall expressly exclude the Management Agreement.

          “ Owner’s Title Policy ” shall mean an owner’s policy of title insurance (in the form of Texas T-1 Owner’s Policy) issued to Purchaser by the Title Company, pursuant to which the Title Company insures Purchaser’s ownership of fee simple title to the Real Property, subject only to Permitted Title Exceptions. The Owner’s Title Policy shall insure Purchaser in the amount of the Purchase Price and shall be in the form customarily used for like transactions in the state where the Land is located.

          “ Person ” shall mean an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization, or a Governmental Authority.

          “ Permitted Title Exceptions ” shall mean those exceptions to title to the Real Property set forth in the Title Commitment or matters reflected on the Survey that are satisfactory or deemed satisfactory to Purchaser or waived or deemed waived by Purchaser pursuant to Section 2.4(e) hereof.

          “ Personal Property ” shall mean collectively the Tangible Personal Property and the Intangible Personal Property.

          “ Property ” shall mean collectively the Real Property and Personal Property.

          “ Purchase Price ” shall mean Two Hundred Fifty-Two Million Five Hundred Thousand and No/100 Dollars ($252,500,000.00), subject to adjustment pursuant to Section 2.2(a) upon receipt of the Survey, which shall be payable in the manner described in Section 2.2 hereof.

          “ Purchaser Knowledge Party ” shall mean the then actual current conscious knowledge, without any duty of investigation or inquiry, of Carter R. Todd, Key Foster and Bennett Westbrook.

          “ Purchaser Parties ” shall have the meaning ascribed to such term in Section 2.4(a) hereof.

          “ Purchaser’s Environmental Consultant ” shall mean an environmental consultant selected by Purchaser and reasonably acceptable to Sellers.

          “ Purchaser’s Objections ” shall mean the objections defined as such in Section 2.4(e) hereof.

          “Purchaser’s Structural Consultant” shall mean a structural engineering consultant selected by Purchaser and reasonably acceptable to Sellers.

          “ Real Property ” shall mean the Land and the Improvements situated thereon.

          “ Remediation Costs ” shall mean all reasonably anticipated fees and expenses to be incurred in connection with the investigation and remediation of an Environmental Condition, including, without limitation, all remediation costs, permitting fees, reasonable attorneys’ fees, consultants’ fees and experts’ fees.

          “ Representatives ” shall have the meaning ascribed to such term in Section 8.5 hereof.

          “ Rooms Ledger ” shall mean the final night’s room revenue for the Hotel (revenue from rooms occupied as of 12:01 a.m. on the Closing Date, exclusive of food, beverage, telephone and similar charges charged or incurred as of such time which shall be retained by Sellers if incurred prior to 12:01 a.m. on the Closing Date and for the benefit of Purchaser if incurred after 12:01 a.m. on the Closing Date), including any sales taxes, room taxes or other taxes thereon..

          “ Sellers’ Response ” shall have the meaning ascribed thereto in Section 2.4(e) .

          “ Sellers’ Response Period ” shall have the meaning ascribed thereto in Section 2.4(e) .

          “ Study Period ” shall mean the period commencing on the Effective Date, and continuing through 5:00 p.m. C.S.T. on the date that is thirty-five (35) days following the Effective Date, as such period may be extended for up to two (2) weeks as provided in Section 2.4(a) . Except as expressly noted herein to the contrary, time periods herein referred to shall mean the time periods as in effect, from time to time, at San Antonio, Texas.

          “ Submission Matters ” shall have the definition ascribed to such term in Section 2.4(b) hereof.

          “ Survey ” shall mean an ALTA/ACSM survey of the Property including Table A Items 2, 3, 4, 6, 7(a), 7(b)(i), 8, 9, 10, 11(a), 13, 14, 16 and 17, prepared by Pape-Dawson Consulting Engineers certified to the Title Company, Sellers and Purchaser consistent with the depiction of the Land attached hereto as Exhibit A which shall certify the Total Gross Acreage.

          “ Tangible Personal Property ” shall mean the items of tangible personal property consisting of all furniture, fixtures, equipment, machinery, Inventory and other tangible personal property of every kind and nature (which does not include cash-on-hand and petty cash funds except as provided in Section 7.6 ) located at the Hotel and owned or leased by Sellers, including, without limitation, Sellers’ interest as lessee with respect to any such leased Tangible Personal

Property, but specifically excluding any such items that contain Westin Names and Marks or that are otherwise to be excluded as provided in Section 6.11 .

          “ Title Commitment ” shall mean the title commitment and exception documents defined as such in Section 2.4(e) hereof.

          “ Title Company ” shall mean Fidelity National Title Insurance Corporation.

          “ Total Gross Acreage ” shall mean the total acreage of the Undeveloped Tracts as certified on the Survey.

          “ Transition Agreement ” shall mean that certain agreement to be entered into at Closing by Manager and Purchaser substantially on the form attached hereto as Exhibit O .

          “ Undeveloped Tract(s) ” shall have the meaning ascribed to such term in the Recitations.

          “ WARN Act ” shall have the meaning ascribed thereto in Section 6.6 .

          “ Warranties and Guaranties ” shall mean any subsisting and assignable warranties and guaranties relating to the Improvements or the Tangible Personal Property or any part thereof.

ARTICLE II
PURCHASE AND SALE; INITIAL DEPOSIT; ADDITIONAL DEPOSIT;
PAYMENT OF PURCHASE PRICE; STUDY PERIOD

     2.1 Purchase and Sale . Subject to Section 7.6, Section 7.9 and Section 8.7, Sellers agree to sell and Purchaser agrees to purchase for the Purchase Price the Property together with Sellers’ right, title and interest in and to all Warranties and Guaranties, Leased Property Agreements, Occupancy Agreements, Off-Site Facility Agreements and Operating Agreements, in accordance with and subject to the other terms and conditions set forth herein.

     2.2 Payment of Purchase Price . The Purchase Price shall be paid to Sellers in the following manner:

          (a) Purchaser shall receive a credit against the Purchase Price in an amount equal to the amount of the Deposit for the Property, with the Deposit being paid to Sellers at Closing. The Purchase Price shall be increased or decreased, as applicable, by replacing the portion of the Purchase Price payable for the Undeveloped Tracts as shown on Schedule 2.4(a) with an amount equal to the product of the Total Gross Acreage of the Undeveloped Tracts as certified by the Survey by $152,460.00.

          (b) Purchaser shall pay the balance of the Purchase Price, as adjusted in the manner specified in Article VII and as set forth below, to Sellers (or other party designated by Sellers) at Closing by making a wire transfer of immediately available federal funds to the account of Sellers (or other party designated by Sellers). Such wire transfer shall be sent by

Purchaser to the Escrow Agent for the account of Sellers no later than 3:00 PM, San Antonio, Texas time on the Closing Date.

          (c) Sellers and Purchaser shall cooperate with each other in good faith to arrive at a mutually acceptable allocation of the Purchase Price among the Real Property and the Personal Property (the “ Allocation ”). Sellers and Purchaser agree to (i) be bound by the Allocation, (ii) act in accordance with the Allocation in the preparation of financial statements and filing of all tax returns and in the course of any tax audit, tax review or tax litigation relating thereto, and (iii) refrain from, and cause their Affiliates to refrain from, taking a position inconsistent with the Allocation for all tax purposes. If, as of the Closing Sellers and Purchaser have not been able to agree on the Allocation, then Sellers and Purchaser shall have the right to allocate the Purchase Price in a manner as reasonably determined by each of them independently.

     2.3 Initial Deposit; Additional Deposit . No later than the Effective Date, Purchaser shall deliver to Escrow Agent (i) a wire transfer or check in the sum of One Thousand and No/100 Dollars ($1,000.00) payable to the order of Sellers representing the independent consideration for Sellers’ execution of this Agreement and agreement to provide Purchaser with the Study Period (which check or the proceeds of which wire transfer shall thereafter be delivered by Escrow Agent to Sellers and shall not be a part of the Deposit or be applicable to the Purchase Price) and (ii) a wire transfer or cashier’s or certified check in the amount of the Initial Deposit. The Initial Deposit, the Additional Deposit, when and if made, and all interest earned thereon are hereinafter collectively referred to as the “Deposit”. The Initial Deposit shall be non-refundable to Purchaser except as otherwise expressly provided in this Agreement. If Purchaser fails to timely deposit the Initial Deposit with Escrow Agent, Sellers shall be entitled, as Sellers’ sole and exclusive remedy, to terminate this Agreement by written notice to Purchaser at any time before the Initial Deposit is delivered to Escrow Agent, in which event neither party shall thereafter have any obligations hereunder, including any obligation to deliver the Initial Deposit, except those which expressly survive a termination of this Agreement. If Purchaser deposits the Initial Deposit with Escrow Agent before Purchaser’s receipt of Sellers’ termination notice, Purchaser shall be deemed to have timely deposited the Initial Deposit and Sellers shall not thereafter be entitled to terminate this Agreement as a result of any delay in depositing the Initial Deposit. In the event that Purchaser does not terminate this Agreement prior to the expiration of the Study Period, then prior to the expiration of the Study Period, time being of the essence, Purchaser shall deliver to Escrow Agent a wire transfer or cashier’s or certified check in the sum of Five Million and No/100 Dollars ($5,000,000.00) (the “ Additional Deposit ”). The Deposit shall be invested by Escrow Agent in a commercial bank or banks acceptable to Sellers and Purchaser at money market rates or in such other investments as shall be approved in writing by Sellers and Purchaser. The Deposit shall be held and disbursed by Escrow Agent in strict accordance with the terms and provisions of this Agreement. All accrued interest or other earnings on the Deposit shall become part of the Deposit. If Purchaser fails to timely deposit the Additional Deposit with Escrow Agent prior to the expiration of the Study Period, such failure shall be automatically deemed to be Purchaser’s election to terminate this Agreement pursuant to Section 2.4 , in which event the Initial Deposit shall be paid to Sellers (except in the event such termination is due to a Material Environmental Condition or Material Structural Defects in which event the Initial Deposit will be refunded to Purchaser) and Purchaser and Sellers shall be released from all further liability or obligation hereunder except those which expressly survive a termination of this Agreement. The Deposit shall be either (a) applied at the Closing against the

Purchase Price, (b) returned to Purchaser pursuant hereto, or (c) paid to Sellers pursuant hereto. For purposes of reporting earned interest with respect to the Additional Deposit, Purchaser’s Federal Tax Identification Number is 73-0664379, and Sellers’ Federal Tax Identification Number are 74-2424552 (La Cantera Development Co.) and 75-2706703 (LCWW).

     2.4 Study Period .

          (a) Purchaser and its respective agents, contractors, auditors, engineers, attorneys, employees, consultants, other representatives and potential lessees, partners, and lenders (collectively, “ Purchaser Parties ”) shall have the right, until 5:00 p.m., San Antonio, Texas time on the last day of the Study Period, and thereafter if Purchaser does not notify Sellers in writing prior to the expiration of the Study Period that Purchaser has elected to terminate this Agreement and Purchaser timely deposits the Additional Deposit, to enter upon the Real Property upon reasonable prior notice to Sellers (which notice, for the purposes of this Section 2.4(a) only, may be given by electronic mail to the following address: susan.swank@usaa.com and robert.kramer@usaa.com), and to perform, at Purchaser’s expense, such economic, surveying, engineering, topographic, environmental, marketing and other tests, studies and investigations as Purchaser may deem appropriate. Notwithstanding anything herein to the contrary, if Purchaser’s Environmental Consultants reasonably recommends obtaining an additional study or investigation of any Environmental Condition, the Study Period shall be extended for up to two (2) weeks to afford Purchaser additional time to complete such investigations. If such tests, studies and investigations warrant, in Purchaser’s sole, absolute and unreviewable discretion, the purchase of the Property for the purposes contemplated by Purchaser, then Purchaser shall proceed with this transaction in accordance with and subject to the terms of this Agreement; provided, however, if, prior to the expiration of the Study Period, Purchaser shall have determined that the Property is unacceptable to Purchaser and Purchaser shall have provided written notice to Sellers and Escrow Agent that it has determined in its sole, absolute and unreviewable discretion, to terminate this Agreement (for any or no reason), this Agreement automatically shall terminate, the Initial Deposit shall be paid to Sellers (except if such termination is as a result of a Material Environmental Condition or Material Structural Defect(s)) and Purchaser and Sellers shall be released from all further liability or obligation hereunder except those which expressly survive a termination of this Agreement. If during the Study Period Purchaser determines that there exists on the Property a Material Environmental Condition, Purchaser shall provide Sellers with reasonable evidence of such condition, whereupon Purchaser may (x) if such condition affects one, but not both of the Undeveloped Tracts, terminate this Agreement with respect to the affected tract in which event such tract shall be excluded from this Agreement for all purposes, the Purchase Price shall be reduced by the amount set forth opposite such affected tract on Schedule 2.4(a) attached hereto and this Agreement shall otherwise continue unmodified or (y) if such condition affects both Undeveloped Tracts or the Hotel, then Purchaser may terminate this Agreement, in either case by delivering written notice to Sellers prior to expiration of the Study Period. If during the Study Period Purchaser determines that Material Structural Defect(s) exist, Purchaser shall provide Sellers with reasonable written evidence of the costs to remedy such defect(s) as estimated by Purchaser’s Structural Consultants (the “Repair Estimate”), then Purchaser may terminate this Agreement by delivering written notice to Sellers prior to expiration of the Study Period. Sellers shall have the right to dispute the Repair Estimate (a “Repairs Costs Dispute”), then Sellers shall have the right to notify Purchaser in writing of the same (a “Repairs Costs Dispute Notice”)

within ten (10) business days after Sellers’ receipt of the Repair Estimate, in which event the termination of this Agreement shall be deferred and Sellers and Purchaser shall thereafter proceed to diligently and in good faith attempt to resolve such dispute and, if the parties are unable to resolve the same within seven (7) business days after Purchaser’s receipt of the applicable Repairs Costs Dispute Notice, such dispute shall be submitted for resolution by binding arbitration in accordance with the terms, conditions and provisions of Exhibit L-1 attached to this Agreement; provided, however, instead of using architects as the arbitrator, three (3) neutral general contractors shall be appointed in the same manner as set forth on Exhibit L-1 . If the agreed amount of the Repairs Estimate is less than $5,000,000.00 such termination notice shall be deemed null and void. Notwithstanding the foregoing, such partial or full termination resulting from any Material Environmental Condition or Material Structural Defect(s) shall be ineffective if within five (5) days following the giving of such notice of termination Purchaser and Sellers agree on the terms of a Purchase Price reduction acceptable to Purchaser and Sellers in connection with such Material Environmental Condition and/or Material Structural Defect(s). If Purchaser terminates this Agreement during the Study Period as the result of the discovery of a Material Environmental Condition or Material Structural Defect(s) the entire Deposit shall be returned to Purchaser and the parties shall have no further obligations hereunder except those that survive termination hereof. If Purchaser does not provide such written notice of termination prior to the expiration of the Study Period and Purchaser timely deposits the Additional Deposit in accordance with Section 2.3 , Purchaser shall be deemed to have determined that the Property is acceptable to Purchaser and the Initial Deposit and the Additional Deposit shall become non-refundable except as otherwise expressly provided in this Agreement. The depositing of the Additional Deposit and the expiration of the Study Period (and Purchaser’s right to terminate same) shall be tolled until such time as the Parties have agreed upon, or arbitration has resolved, the amount of the Material Structural Defect(s). Purchaser Parties shall have no discussions, correspondence, or other contact with any Hotel Employees, including, without limitation, any Executive Employees unless approved by and coordinated in advance with Sellers. Sellers agree to use all commercially reasonable efforts to cause Manager to permit Purchaser to have reasonable opportunities to discuss the Hotel and its business and employment with the General Manager, Controller, Director of Sales and Chief Engineer of the Hotel.

          (b) Sellers have either made available for review and inspection in its offices or have delivered to Purchaser copies of the documents described on Schedule 2.4(b) attached hereto to the extent in Sellers’ possession or control (collectively, the “ Submission Matters ”).

     Sellers shall also promptly deliver to Purchaser such other materials with respect to the Property as Purchaser may reasonably request in writing between the Effective Date and Closing that would be customarily given to a purchaser of a similar type of hotel property, to the extent the same are in Sellers’ possession or control, are not subject to the attorney-client privilege and can be delivered without breaching any obligations to a third party; provided, however, that Sellers, to the extent permitted, shall identify generally any such materials that Purchaser requested that Sellers cannot provide as a result of the attorney-client privilege or any obligations to a third party. Notwithstanding anything herein to the contrary, Sellers shall have no obligation to deliver any materials to Purchaser to the extent their delivery is prohibited pursuant to the terms of the Management Agreement.

     If Sellers fail to make available any of the Submission Matters as provided above or fail to provide any of the items specified in Section 2.4(e) below as provided therein, Purchaser shall give Sellers notice thereof so that Sellers shall have an opportunity to cure such failure by providing such items. Sellers shall use good faith efforts to deliver all Submission Matters in its possession or control to Purchaser.

          (c) If for any reason whatsoever Purchaser does not purchase the Property, Purchaser shall promptly deliver to Sellers, (i) all copies of all the Submission Matters and any other materials delivered to Purchaser or Purchaser Parties and (ii) all third-party reports prepared by or for Purchaser or Purchaser Parties with respect to the Property; provided, however, that Purchaser shall not be obligated to deliver to Sellers any materials of a proprietary nature (such as, for the purposes of example only, any financial forecasts or market repositioning plans) prepared for Purchaser or Purchaser Parties in connection with the Property or any materials subject to attorney-client privilege, and Sellers acknowledge that any such materials delivered to Sellers pursuant to the provisions of clause (ii) shall be without warranty or representation whatsoever other than that such materials have been fully paid for and may be delivered to Sellers. The provisions of this Section 2.4(c) shall survive termination of this Agreement.

          (d) Purchaser shall indemnify, hold harmless and defend Manager and Sellers from and against any loss, damage, liability or claim for personal injury or property damage and any other loss, damage, liability, claim or lien to the extent arising from the acts at or upon the Real Property by Purchaser or any of Purchaser’s Affiliates engaged in Purchaser’s inspection activities or any agents, contractors or employees of any of them, but excluding (i) any such loss, damage or claim if and to the extent caused by the negligence or reckless or willful misconduct of Sellers and/or Manager or any of their respective agents, contractors, auditors, engineers, attorneys, employees, consultants and other representatives that are not Purchaser or Purchaser Affiliates engaged in Purchaser’s inspection activities, and (ii) any liability or obligation in connection with the discovery of a pre-existing condition affecting the Property not occasioned by or through a Purchaser or Purchaser Affiliates engaged in Purchaser’s inspection activities. Purchaser understands and agrees that any on-site inspections of the Property shall occur at reasonable times agreed upon by Sellers and Purchaser after reasonable prior written notice to Sellers and shall be conducted so as not to interfere unreasonably with the operation of the Property and the use of the Property by the tenants and the guests of the Hotel. Manager and/or Sellers shall have the right to have a representative present during any such inspections. If Purchaser desires to do any invasive testing at the Property, Purchaser shall do so only after notifying Sellers and obtaining Sellers’ prior written consent thereto (which consent will not be unreasonably withheld, conditioned or delayed). Purchaser shall not permit any liens to attach to the Property by reason of such inspections. Purchaser shall (i) restore the Property, at its own expense, to substantially the same condition which existed prior to any inspection or other activities of Purchaser thereon; and (ii) be responsible for and pay any and all liens by contractors, subcontractors, materialmen, or laborers performing the inspections or any other work for Purchaser or Purchaser Affiliates engaged in Purchaser’s inspection activities on or related to the Property. All contractors and others performing any tests and studies on the Property shall first present to Sellers reasonably satisfactory evidence that such party is adequately insured in order to reasonably protect Sellers and Manager from any loss, liability, or damage arising out of the performance of such tests or studies. Purchaser shall not solicit for

employment any Hotel Employees except for employment at the Hotel in accordance with Section 6. 5 if the transaction is consummated. The provisions of this Section 2.4(d) shall survive any termination of this Agreement and a closing of the transaction contemplated hereby.

          (e) Sellers shall deliver to Purchaser by December 5, 2007 or as soon thereafter as practicable the Survey. Sellers shall within five (5) days following the Effective Date deliver to Purchaser, a title insurance commitment dated no earlier than thirty (30) days prior to the Effective Date and issued by the Title Company covering the Real Property, binding the Title Company to issue the Owner’s Title Policy together with legible copies (to the extent such legible copies are available) of all documents identified in such title insurance commitment as exceptions to title (collectively, the “ Title Commitment ”), with respect to the state of title to the Property. Not later than ten (10) days following receipt of both the Title Commitment and Survey, Purchaser shall notify Sellers of any matters shown on such Survey or identified in the Title Commitment that Purchaser is unwilling to accept (including any defect or failure of the Survey or Title Commitment to comply with the requirements of this Section 2.4(e) ) (collectively, “ Purchaser’s Objections ”). If any of Purchaser’s Objections consist of Monetary Title Encumbrances (but not including liens against the Property in the nature of those arising from judgments or pending litigation or construction, mechanics or other liens or charges which are being contested by Sellers in good faith, or liens which were not created or expressly assumed by Sellers [“ Non-Mandatory Monetary Title Encumbrances ”] or rights of third party lessors with respect to any Leased Property, all of which Sellers shall not have any obligation to satisfy or remove, but which may be, at Purchaser’s election, included as part of Purchaser’s Objections), then, to that extent, notwithstanding anything herein to the contrary, Sellers shall be obligated to either (i) pay and discharge, (ii) bond against in a manner legally sufficient to cause to be released, or (iii) indemnify or escrow money with or otherwise cause the Title Company to insure over in a manner reasonably acceptable to Purchaser (and with respect to a mortgagee/lender policy, omit), such Monetary Title Encumbrances (individually and collectively, a “ Monetary Encumbrance Release ”). For such purposes, Sellers may use all or a portion of the Purchase Price to effectuate a Monetary Encumbrance Release with respect to any such Monetary Title Encumbrances at the Closing. Other than (i) as specifically required in this Agreement, (ii) Monetary Title Encumbrances, which are required to be covered by a Monetary Encumbrance Release at Closing as provided above, and (iii) using commercially reasonable efforts to cure Non-Mandatory Monetary Title Encumbrances (provided that Sellers shall be obligated to expend up to $250,000.00 in the aggregate to cure such Non-Mandatory Monetary Title Encumbrances), Sellers shall not be obligated to incur any expenses or incur any liability to cure any Purchaser’s Objections. Sellers may notify Purchaser within five (5) days after receipt of notice of Purchaser’s Objections (“ Sellers’ Response Period ”) whether Sellers, in their sole discretion, agree to attempt to cure any of such Purchaser’s Objections (other than Sellers’ obligations with respect to the Monetary Title Encumbrances and certain Non-Mandatory Monetary Title Encumbrances as set forth above) (“ Sellers’ Response ”). If Sellers agree in Sellers’ Response to attempt to cure any of such Purchaser’s Objections (that they are otherwise not obligated to cure as provided herein), Sellers shall use good faith efforts to cure (without any obligation to expend any money or incur any liability) such Purchaser’s Objections that Sellers have agreed to attempt to cure on or before the Closing Date to the reasonable satisfaction of Purchaser. If Sellers are unable or unwilling to cure such Purchaser’s Objections (that they are otherwise not obligated to cure as provided herein) by the Closing Date, Purchaser shall, prior to Closing, elect (1) to waive such Purchaser’s Objections without any abatement in the Purchase

Price, (2) to terminate this Agreement in which case the Additional Deposit, if paid, shall be promptly returned to Purchaser, the Initial Deposit shall be paid to Sellers (except if such unsatisfied Purchaser Objection is a Non-Mandatory Monetary Title Encumbrance or would have a Material Adverse Effect, in which event Purchaser may (x) if such condition affects one, but not both of the Undeveloped Tracts, terminate this Agreement with respect to the affected tract in which event such tract shall be excluded from this Agreement for all purposes, the Purchase Price shall be reduced by the amount set forth opposite such affected tract on Schedule 2.4(a) attached hereto and this Agreement shall otherwise continue unmodified or (y) if such condition affects both Undeveloped Tracts or the Hotel, then Purchaser may terminate this Agreement whereupon the Additional Deposit, if paid, and one-half of the Initial Deposit shall be returned to Purchaser, one-half of the Initial Deposit shall be paid to Sellers and the parties hereto shall be released from all further obligations hereunder, except those which expressly survive a termination of this Agreement) and the parties hereto shall be released from all further obligations hereunder, except those which expressly survive a termination of this Agreement. If Sellers do not provide Sellers’ Response to Purchaser within Sellers’ Response Period, Sellers shall be deemed to have elected not to attempt to cure Purchaser’s Objections. If Sellers elect in Sellers’ Response not to attempt to cure all or any number of Purchaser’s Objections or if Sellers are deemed to have elected not to attempt to cure Purchaser’s Objections pursuant to the preceding sentence, within five (5) days after the expiration of Sellers’ Response Period, Purchaser shall elect (1) to waive any Purchaser’s Objections which Sellers have elected or is deemed to have elected not to attempt to cure without any abatement in the Purchase Price, or (2) to terminate this Agreement in which case the Additional Deposit, if paid, shall be promptly returned to Purchaser, Sellers shall be paid the Initial Deposit (except if such unsatisfied Purchaser Objection is a Non-Mandatory Monetary Title Encumbrance or would have a Material Adverse Effect, in which event Purchaser may (x) if such condition affects one, but not both of the Undeveloped Tracts, terminate this Agreement with respect to the affected tract in which event such tract shall be excluded from this Agreement for all purposes, the Purchase Price shall be reduced by the amount set forth opposite such affected tract on Schedule 2.4(a) attached hereto and this Agreement shall otherwise continue unmodified or (y) if such condition affects both Undeveloped Tracts or the Hotel, then Purchaser may terminate this Agreement whereupon the Additional Deposit, if paid, and one-half of the Initial Deposit shall be returned to Purchaser, one-half of the Initial Deposit shall be paid to Sellers and the parties hereto shall be released from all further obligations hereunder, except those which expressly survive a termination of this Agreement) and the parties hereto shall be released from all further obligations hereunder, except those which expressly survive a termination of this Agreement. In the event Purchaser does not provide to Sellers notice of Purchaser’s election under the preceding sentence within such five (5) day period, Purchaser shall be deemed to have elected clause (2) of the preceding sentence. Except as otherwise provided herein, Sellers shall not, after the date of this Agreement and prior to Closing, voluntarily subject the Real Property to any liens, encumbrances, covenants, conditions, restrictions, easements or other title matters or seek any zoning changes without Purchaser’s prior written consent, which consent shall be subject to the Approval Standard (as hereafter defined). All title matters revealed by the Title Commitment and Survey which are not objected to by Purchaser as provided above (other than Monetary Title Encumbrances, which will be covered by a Monetary Encumbrance Release at Closing), or which are waived or deemed waived by Purchaser as provided above, shall be deemed Permitted Title Exceptions. Sellers shall cause the Property (with the exception of the Palmer Course [as

depicted on Exhibit A ]), as well as Tracts F3B, D4, F4 and the tract northwest of D4 (all as depicted on the pictorial on Exhibit A attached hereto), at or prior to Closing, to be made subject to the Commercial Covenants and the Master Covenants and any La Cantera Design Guidelines promulgated thereunder (and the same shall constitute Permitted Title Exceptions) pursuant to an annexation or similar agreement (or amendment to the existing documents) to be recorded at Closing (an “ Annexation Agreement ”). The parties shall negotiate, in good faith, prior to Closing the terms and provisions of the Annexation Agreement, which shall provide for the following matters: (i) the Declarant under the Commercial Covenants and the Master Covenants (the “ Declarant ”) shall not unilaterally amend or modify any of the terms or conditions of the Commercial Covenants and the Master Covenants (including any rules and regulations promulgated thereunder) in any manner that would be material and adverse to Purchaser’s (and its successors’ and assigns’) rights with respect to the Property, (ii) subject to the Declaration, any Timeshare Development and/or residential use (and any facilities and uses ancillary thereto) shall be expressly permitted on the Property, (iii) individual owners participating in any such Timeshare Development or residential development on the Property shall not constitute a “Commercial Owner” (as defined therein), but any association or similar governing body governing such developments shall constitute a “Commercial Owner” and be responsible for all such assessments of such “Commercial Owner”; and (iv) the Annexation Agreement shall be binding on Declarant any and all successor or assigns of Declarant.

     If after the expiration of the Study Period, Purchaser discovers, any title matter that is not disclosed in the Title Commitment (or was disclosed but was not shown on the Survey if otherwise plotable (e.g., a matter first put on record title after the date of the Survey)) or the Survey provided to Purchaser and is not otherwise expressly permitted under the terms of this Agreement (“ New Title Matter ”), and if the New Title Matter is materially adverse to the use, ownership, operation or development or potential development of the Property and Sellers are unable or elect not to cure such title matter on or prior to the Closing (except for a Monetary Title Encumbrance, which will be covered by a Monetary Encumbrance Release at Closing or Non-Mandatory Monetary Title Encumbrances, which Seller shall endeavor to cure as provided in the first paragraph of this Section 2.4(e) ), Purchaser shall have the option (1) to waive such title matter without any abatement in the Purchase Price, in which event, such title matter shall become a Permitted Title Exception, or (2) not waive such title matter, in which event, Purchaser may (x) if such condition affects one, but not both of the Undeveloped Tracts, terminate this Agreement with respect to the affected tract in which event such tract shall be excluded from this Agreement for all purposes, the Purchase Price shall be reduced by the amount set forth opposite such affected tract on Schedule 2.4(a) attached hereto and this Agreement shall otherwise continue unmodified or (y) if such condition affects both Undeveloped Tracts or the Hotel, then Purchaser may terminate this Agreement whereupon the Additional Deposit and one-half of the Initial Deposit shall be returned to Purchaser, one-half of the Initial Deposit shall be paid to Sellers and the parties hereto shall be released from all further obligations hereunder, except those which expressly survive a termination of this Agreement). Notwithstanding the foregoing, Sellers shall be obligated to cure any New Title Matter voluntarily created by Sellers in violation of this Section 2.4(e) .

          (f) At Closing, Sellers and Purchaser shall enter into the easement agreements (the “ Easement Agreements ”) substantially in the form of Exhibit B attached hereto.

          (g) At Closing, Purchaser and Sellers shall enter into a Golf Course Agreement substantially in the form of Exhibit J attached hereto (the “ Golf Course Agreement ”).

          (h) At Closing, Purchaser and Sellers shall enter into an agreement at Closing providing the golf course benefits to certain executives of Sellers’ Affiliates that are more particularly described on Exhibit K attached hereto (the “Executive Agreement”), which agreement shall be agreed upon by the Parties during the Study Period.

          (i) Notwithstanding anything herein to the contrary, if Purchaser has the right to terminate this Agreement in whole or in part pursuant to (x) Section 2.4(a) in connection with the discovery of a Material Environmental Condition, (y) Section 2.4(e) in connection with a title or survey matter that would have a Material Adverse Effect, or (z) Article III in connection with the updating of any representation or warranty that would have a Material Adverse Effect then in addition to any right of Purchaser and Sellers to agree on a mutually acceptable reduction in the Purchase Price in connection with such event or circumstance, Sellers shall have the right to render such termination notice ineffective and of no further force or effect by agreeing in writing within five (5) business days following receipt of Purchaser’s termination notice to cure such circumstance or condition in its entirety to the reasonable satisfaction of Purchaser on or before Closing. Notwithstanding anything herein to the contrary, if Purchaser has the right to terminate this Agreement pursuant to Section 2.4(a) in connection with Material Structural Defect(s), then in addition to any right of Purchaser and Sellers to agree on a mutually acceptable reduction in the Purchase Price in connection with such event or circumstance, Sellers shall have the right to render such termination notice ineffective and of no further force or effect by agreeing in writing within five (5) business days following the later of receipt of Purchaser’s termination notice or agreement upon the Repairs Estimate, to either (x) cure such circumstance or condition to the reasonable satisfaction of Purchaser on or before Closing, but excluding a portion of the Material Structural Defect(s) selected by Sellers that would cost less than $2,5000,000.00 to cure or (y) give Purchaser a credit in the amount of the Repair Estimate less the sum of $2,500,000.00. If Sellers fail to cure such circumstance or condition in its entirety to the reasonable satisfaction of Purchaser prior to Closing, Purchaser shall have the right to (i) waive such non-performance and proceed to Closing, (ii) terminate this Agreement in whole or in part as originally provided in Purchaser’s termination and, if applicable, recover the Deposit (or such portion of the Deposit to which Purchaser was entitled to recover in connection with such termination), or (iii) extend Closing for up to ten (10) business days to provide Sellers with additional time to effect such cure, provided that if such condition or circumstance has not been cured to Purchaser’s reasonable satisfaction by the end of such extended period, Purchaser may thereafter only elect to proceed under clauses (i) or (ii). Purchaser shall make such election no later than the Closing Date, and in the absence of a timely election, Purchaser shall be deemed to have elected to proceed pursuant to clause (ii) of the proceeding sentence.

ARTICLE III
SELLERS’ REPRESENTATIONS AND WARRANTIES

     To induce Purchaser to enter into this Agreement and to consummate the transaction described in this Agreement, Sellers hereby make the following representations and warranties as of the Effective Date, and which shall be re-made as of the Closing Date pursuant to the closing certificate referenced in Section 7.2(l) , upon which Sellers acknowledge and agree that Purchaser

is entitled to rely, except for and subject to (a) information contained in the Submission Matters and (b) matters and/or information that is within the actual knowledge of any Purchaser Knowledge Party:

     3.1 Organization and Power . Each of the Sellers are duly organized, validly existing and in good standing under the laws of Texas and has all requisite power and authority to enter into and perform its obligations hereunder and under any document or instrument required to be executed and delivered on behalf of each Seller hereunder.

     3.2 Authorization and Execution . This Agreement has been duly authorized by all necessary action on the part of each Seller, has been duly executed and delivered by each Seller, constitutes the valid and binding agreement of each Seller and is enforceable in accordance with its terms. The person executing this Agreement on behalf of each Seller has the authority to do so.

     3.3 Non-contravention . Subject to any consent to the assignment of any particular Operating Agreement, Occupancy Agreement, Leased Property Agreement or Off-site Facility Agreement required by the terms thereof or by Applicable Law and to the payment in full at the Closing of any Monetary Title Encumbrances, the execution and delivery of, and the performance by Sellers of its obligations under, this Agreement do not and will not contravene, or constitute a default under, any provision of applicable law or regulation, Sellers’ organizational documents or any agreement, judgment, injunction, order, decree or other instrument binding upon Sellers or to which the Property is subject.

     3.4 No Special Taxes . To Sellers’ knowledge, except as otherwise disclosed by the Title Commitment, Sellers have not received any written notice of any proposed special taxes or assessments relating to the Property or any part thereof or any planned public improvements that will result in a special tax or assessment against the Property.

     3.5 Compliance with Existing Laws . Sellers have not received and, to Seller’s knowledge, Manager has not received, except as otherwise disclosed by any property inspection report delivered by Sellers to Purchaser, from any Governmental Authority written notice of any material violation of any provision of Applicable Laws, including, but not limited to, those of environmental agencies, with respect to the ownership, operation, use, maintenance or condition of the Property which violation has not been remedied. As used in this Section 3.5, a violation of Applicable Laws shall only be deemed material if the cost to remedy same is in excess of $100,000 in the aggregate.

     3.6 Management Agreement/Operating Agreements . To Sellers’ knowledge:

There are no material management, service, supply, or maintenance contracts in effect with respect to the Property other than the Management Agreement, Operating Agreements, a list of all material Operating Agreements, including any amendments, is included on Schedule 3.6 attached hereto, Leased Property Agreements, a list of all material Leased Property Agreements, including any amendments, is included on Schedule 3.6 attached hereto, or Off-Site Facility Agreements, a list of all material Off-Site Facility Agreements which, including any amendments, is included on Schedule 3.6 attached hereto, all of which have been made available

to Purchaser as Submission Matters, or those disclosed in the Title Commitment. All parties to the Operating Agreements, Leased Property Agreements and Off-Site Facility Agreements have performed all of their obligations thereunder in all material respects, and are not in default thereunder in any material respect. Sellers have received no written notice of any intention by any of the parties to any of the material Operating Agreements, Leased Property Agreements or Off-Site Facility Agreements to cancel the same, nor have Sellers canceled any of same. For purposes of this Agreement, an Operating Agreement, Leased Property Agreement or Off-Site Facility Agreement shall be deemed “material” only if it requires an expenditure of $50,000.00 in any twelve (12) month period or $100,000.00 in the aggregate.

     3.7 Insurance . To Sellers’ knowledge, all of Sellers’ Insurance Policies are valid and in full force and effect and Sellers have not received any written notice that it has failed to comply with any requirements thereof.

     3.8 Condemnation Proceedings; Roadways . To Sellers’ knowledge, Sellers have received no written notice of any condemnation or eminent domain proceeding pending against the Property or any part thereof, and to Sellers’ knowledge, no such proceeding has been threatened.

     3.9 Actions or Proceedings . Sellers have received no written notice of any suit or proceeding in any court, before any arbitrator, or before or by any Governmental Authority which (a) in any manner raises any question affecting the validity or enforceability of this Agreement or any other agreement or instrument to which either Sellers are a party or by which it is bound and that is or is to be used in connection with, or is contemplated by, this Agreement, (b) would materially and adversely affect the business, results of operations or operation of the Property as presently conducted, or (c) would materially and adversely affect the ability of either Seller to perform its obligations hereunder, or under any document to be delivered pursuant hereto.

     3.10 Labor and Employment . To Sellers’ knowledge:

Sellers are not a party to any written employment agreements with respect to the Property. Sellers employ no employees with respect to the Property and the only employees performing any duties at the Property are employees of the Manager.

     3.11 Financial Information . To Sellers’ knowledge, all financial statements provided to Purchaser by Sellers are correct and complete in all material respects and present fairly the results of the operations of the Property for the periods indicated.

     3.12 Occupancy Agreements . There are no leases, concessions or occupancy agreements giving third parties the right to lease or occupy all or any part of the Real Property in effect other than the Occupancy Agreements, a true, correct and complete list of all Occupancy Agreements, including any amendments, is included on Schedule 3.12 attached hereto, true, correct and complete copies of which have been made available to Purchaser as Submission Matters, and agreements with respect to Hotel guests in the ordinary course of business. To Sellers’ knowledge: (1) except as provided in the Occupancy Agreements, no tenant or concessionaire is entitled to any rebates, allowances, free rent or rent abatement for any period

after the Closing of the transaction contemplated hereby. Sellers have not received written notice of any breach or default or of any intention by any of the parties to any Occupancy Agreement to cancel the same, nor have Sellers canceled any of same; (2) to the extent that any of the Occupancy Agreements call for security, such security remains on deposit with Sellers, and has not been applied towards any payment due under said Occupancy Agreements; (3) there are no commissions due and owing to any broker with respect to the current term of any of the Occupancy Agreements; (4) Sellers have not received any advance rent or advance compensation under any of said Occupancy Agreements in excess of one month; (5) no party is in default under any Occupancy Agreement in any material respect; (6) Sellers have performed in all material respects all obligations required of it under all of the Occupancy Agreements and there remain no unfulfilled material obligations of Sellers under any Occupancy Agreement; and (7) no tenant has given written notice to Sellers of its intention to institute litigation with respect to any Occupancy Agreement.

     3.13 Americans With Disabilities Act . To Sellers’ knowledge, except as disclosed by any property inspection report delivered to Purchaser by Sellers, Sellers have not received any written notice from any Governmental Authority that the Property is not in compliance with the Americans With Disabilities Act.

     3.14 No Commitments . Except as disclosed by the Title Commitment, to Seller’s knowledge no material commitments have been made by Sellers to any Governmental Authority, utility company, school board, church or other religious body, or any homeowners’ association or any other organization, group or individual, relating to the Property which would impose an obligation upon Purchaser to make any contribution or dedication of money or land or to construct, install or maintain any improvements of a public or private nature on or off the Property.

     3.15 Sellers are Not “Foreign Persons” . Sellers are not “foreign persons” within the meaning of Section 1445 of the Internal Revenue Code, as amended (i.e., Sellers are not a foreign corporation, foreign partnership, foreign trust, foreign estate or foreign person as those terms are defined in the Internal Revenue Code and regulations promulgated thereunder).

     3.16 Litigation . Except as set forth on Schedule 3.16 , there is no litigation, action, investigation or proceeding (including, but not limited to, proceedings in respect to a condemnation) pending or, to Sellers’ knowledge, threatened in writing relating to the Property or the transactions contemplated by this Agreement other than claims for personal injury or property damage which are covered by liability insurance and for which the insurer is providing a defense.

     3.17 Liquor License . To Sellers’ knowledge, any and all liquor licenses currently used in connection with the operation of the Hotel are held in the name of the Manager or its Affiliates.

     3.18 Taxes . All federal, state and local employment taxes, payroll taxes, excise taxes, occupancy or entertainment taxes, ad valor