curve driven patterns

I am trying to complete this exercise by getting the cut extrude hole to pattern the sketch named "curve". When creating the sketch I right clicked the outer edge and selected Tangency then used sketch offset to produce the sketch named curve. When I try to select "curve" for  direction 1 in the Curve Driven Pattern dialog I get a dialog box saying, " All segments of the profile must be tangential and should be of one contour  only." What am I missing? Why will the sketch not select?

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