SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
Quarterly Report Under Section 13 or 15(d)
of The Securities Exchange Act of 1934
For the Quarter Ended: March 31, 2000
Commission file number: 24003
AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP
(Exact Name of Small Business Issuer as Specified in its Charter)
State of Minnesota 41-1848181
(State or other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
1300 Minnesota World Trade Center, St. Paul, Minnesota 55101
(Address of Principal Executive Offices)
(651) 227-7333
(Issuer's telephone number)
Not Applicable
(Former name, former address and former fiscal year, if changed
since last report)
Check whether the issuer (1) filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90
days.
Yes [X] No
Transitional Small Business Disclosure Format:
Yes No [X]
AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP
INDEX
PART I. Financial Information
Item 1. Balance Sheet as of March 31, 2000 and December 31, 1999
Statements for the Periods ended March 31, 2000 and 1999:
Income
Cash Flows
Changes in Partners' Capital
Notes to Financial Statements
Item 2. Management's Discussion and Analysis
PART II. Other Information
Item 1. Legal Proceedings
Item 2. Changes in Securities
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
<PAGE>
AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP
BALANCE SHEET
MARCH 31, 2000 AND DECEMBER 31, 1999
(Unaudited)
ASSETS
2000 1999
CURRENT ASSETS:
Cash and Cash Equivalents $ 1,969,440 $ 247,401
INVESTMENTS IN REAL ESTATE:
Land 4,516,199 4,981,547
Buildings and Equipment 7,454,006 8,382,000
Property Acquisition Costs 7,068 0
Accumulated Depreciation (264,944) (201,635)
----------- -----------
Net Investments in Real Estate 11,712,329 13,161,912
----------- -----------
Total Assets $13,681,769 $13,409,313
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Payable to AEI Fund Management, Inc. $ 129,357 $ 14,979
Distributions Payable 256,847 256,847
Unearned Rent 33,506 0
----------- -----------
Total Current Liabilities 419,710 271,826
----------- -----------
PARTNERS' CAPITAL (DEFICIT):
General Partners (35,009) (38,746)
Limited Partners, $1,000 Unit Value;
24,000 Units authorized; 16,917 Units issued;
16,808 outstanding 13,297,068 13,176,233
----------- -----------
Total Partners' Capital 13,262,059 13,137,487
----------- -----------
Total Liabilities and Partners' Capital $13,681,769 $13,409,313
=========== ===========
The accompanying Notes to Financial Statements are an integral
part of this statement.
</PAGE>
<PAGE>
AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP
STATEMENT OF INCOME
FOR THE PERIODS ENDED MARCH 31
(Unaudited)
2000 1999
INCOME:
Rent $ 298,260 $ 82,627
Investment Income 6,180 112,245
----------- -----------
Total Income 304,440 194,872
----------- -----------
EXPENSES:
Partnership Administration - Affiliates 39,026 43,213
Partnership Administration and Property
Management - Unrelated Parties 13,968 8,905
Depreciation 86,690 14,502
----------- -----------
Total Expenses 139,684 66,620
----------- -----------
OPERATING INCOME 164,756 128,252
GAIN ON SALE OF REAL ESTATE 221,420 0
----------- -----------
NET INCOME $ 386,176 $ 128,252
=========== ===========
NET INCOME ALLOCATED:
General Partners $ 11,585 $ 3,848
Limited Partners 374,591 124,404
----------- -----------
$ 386,176 $ 128,252
=========== ===========
NET INCOME PER LIMITED PARTNERSHIP UNIT
(16,808 and 16,580 weighted average Units
outstanding in 2000 and 1999, respectively) $ 22.29 $ 7.50
=========== ===========
The accompanying Notes to Financial Statements are an integral
part of this statement.
</PAGE>
<PAGE>
AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP
STATEMENT OF CASH FLOWS
FOR THE PERIODS ENDED MARCH 31
(Unaudited)
2000 1999
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 386,176 $ 128,252
Adjustments To Reconcile Net Income
To Net Cash Provided By Operating Activities:
Depreciation 86,690 14,502
Gain on Sale of Real Estate (221,420) 0
Decrease in Receivables 0 2,153
Increase (Decrease) in Payable to
AEI Fund Management, Inc. 114,378 (119,124)
Increase in Unearned Rent 33,506 5,701
----------- -----------
Total Adjustments 13,154 (96,768)
----------- -----------
Net Cash Provided By
Operating Activities 399,330 31,484
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Investments in Real Estate (7,068) (2,268,192)
Proceeds from Sale of Real Estate 1,591,381 0
----------- -----------
Net Cash Provided By (Used For)
Investing Activities 1,584,313 (2,268,192)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Capital Contributions from Limited Partners 0 972,059
Organization and Syndication Costs 0 (143,883)
Increase in Distributions Payable 0 37,843
Distributions to Partners (261,604) (299,320)
----------- -----------
Net Cash Provided By (Used For)
Financing Activities (261,604) 566,699
----------- -----------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 1,722,039 (1,670,009)
CASH AND CASH EQUIVALENTS, beginning of period 247,401 10,206,442
----------- -----------
CASH AND CASH EQUIVALENTS, end of period $ 1,969,440 $ 8,536,433
=========== ===========
The accompanying Notes to Financial Statements are an integral
part of this statement.
</PAGE>
<PAGE>
AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
FOR THE PERIODS ENDED MARCH 31
(Unaudited)
Limited
Partnership
General Limited Units
Partners Partners Total Outstanding
BALANCE, December 31, 1998 $(21,135) $12,917,288 $12,896,153 15,945.16
Capital Contributions 0 972,059 972,059 972.06
Organization and
Syndication Costs 0 (143,883) (143,883)
Distributions (8,980) (290,340) (299,320)
Net Income 3,848 124,404 128,252
--------- ----------- ----------- -----------
BALANCE, March 31, 1999 $(26,267) $13,579,528 $13,553,261 16,917.22
========= =========== =========== ===========
BALANCE, December 31, 1999 $(38,746) $13,176,233 $13,137,487 16,808.18
Distributions (7,848) (253,756) (261,604)
Net Income 11,585 374,591 386,176
--------- ----------- ----------- -----------
BALANCE, March 31, 2000 $(35,009) $13,297,068 $13,262,059 16,808.18
========== =========== =========== ===========
The accompanying Notes to Financial Statements are an integral
part of this statement.
</PAGE>
<PAGE>
AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2000
(Unaudited)
(1) The condensed statements included herein have been prepared
by the Partnership, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission, and
reflect all adjustments which are, in the opinion of
management, necessary to a fair statement of the results of
operations for the interim period, on a basis consistent with
the annual audited statements. The adjustments made to these
condensed statements consist only of normal recurring
adjustments. Certain information, accounting policies, and
footnote disclosures normally included in financial
statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant
to such rules and regulations, although the Partnership
believes that the disclosures are adequate to make the
information presented not misleading. It is suggested that
these condensed financial statements be read in conjunction
with the financial statements and the summary of significant
accounting policies and notes thereto included in the
Partnership's latest annual report on Form 10-KSB.
(2) Organization -
AEI Income & Growth Fund XXII Limited Partnership
(Partnership) was formed to acquire and lease commercial
properties to operating tenants. The Partnership's
operations are managed by AEI Fund Management XXI, Inc.
(AFM), the Managing General Partner. Robert P. Johnson, the
President and sole shareholder of AFM, serves as the
Individual General Partner and an affiliate of AFM, AEI Fund
Management, Inc. (AEI), performs the administrative and
operating functions for the Partnership.
The terms of the Partnership offering call for a
subscription price of $1,000 per Limited Partnership Unit,
payable on acceptance of the offer. The Partnership
commenced operations on May 1, 1997 when minimum
subscriptions of 1,500 Limited Partnership Units
($1,500,000) were accepted. The offering terminated January
9, 1999 when the extended offering period expired. The
Partnership received subscriptions for 16,917.222 Limited
Partnership Units ($16,917,222).
Under the terms of the Limited Partnership Agreement, the
Limited Partners and General Partners contributed funds of
$16,917,222 and $1,000, respectively. During operations,
any Net Cash Flow, as defined, which the General Partners
determine to distribute will be distributed 97% to the
Limited Partners and 3% to the General Partners.
Distributions to Limited Partners will be made pro rata by
Units.
Any Net Proceeds of Sale, as defined, from the sale or
financing of properties which the General Partners determine
to distribute will, after provisions for debts and reserves,
be paid in the following manner: (i) first, 99% to the
Limited Partners and 1% to the General Partners until the
Limited Partners receive an amount equal to: (a) their
Adjusted Capital Contribution plus (b) an amount equal to 9%
of their Adjusted Capital Contribution per annum, cumulative
but not compounded, to the extent not previously distributed
from Net Cash Flow; (ii) any remaining balance will be
distributed 90% to the Limited Partners and 10% to the
General Partners. Distributions to the Limited Partners
will be made pro rata by Units.
AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(2) Organization - (Continued)
For tax purposes, profits from operations, other than
profits attributable to the sale, exchange, financing,
refinancing or other disposition of property, will be
allocated first in the same ratio in which, and to the
extent, Net Cash Flow is distributed to the Partners for
such year. Any additional profits will be allocated in the
same ratio as the last dollar of Net Cash Flow is
distributed. Net losses from operations will be allocated
99% to the Limited Partners and 1% to the General Partners.
For tax purposes, profits arising from the sale, financing,
or other disposition of property will be allocated in
accordance with the Partnership Agreement as follows: (i)
first, to those partners with deficit balances in their
capital accounts in an amount equal to the sum of such
deficit balances; (ii) second, 99% to the Limited Partners
and 1% to the General Partners until the aggregate balance
in the Limited Partners' capital accounts equals the sum of
the Limited Partners' Adjusted Capital Contributions plus an
amount equal to 9% of their Adjusted Capital Contributions
per annum, cumulative but not compounded, to the extent not
previously allocated; (iii) third, the balance of any
remaining gain will then be allocated 90% to the Limited
Partners and 10% to the General Partners. Losses will be
allocated 98% to the Limited Partners and 2% to the General
Partners.
The General Partners are not required to currently fund a
deficit capital balance. Upon liquidation of the
Partnership or withdrawal by a General Partner, the General
Partners will contribute to the Partnership an amount equal
to the lesser of the deficit balances in their capital
accounts or 1% of total Limited Partners' and General
Partners' capital contributions.
(3) Investments in Real Estate -
On June 29, 1998, the Partnership purchased a parcel of land
in Centerville, Ohio for $1,850,988. On August 28, 1998,
the Partnership assigned, for diversification purposes, 77%
of its interest in the property to three affiliated
partnerships. The land is leased to Americana Dining
Corporation (ADC) under a Lease Agreement with a primary
term of 20 years and annual rental payments of $29,801.
Effective December 25, 1998, the annual rent was increased
to $44,701. Simultaneously with the purchase of the land,
the Partnership entered into a Development Financing
Agreement under which the Partnership advanced funds to ADC
for the construction of a Champps Americana restaurant on
the site. Initially, the Partnership charged interest on
the advances at a rate of 7.0%. Effective December 25,
1998, the interest rate was increased to 10.5%. On January
27, 1999, after the development was completed, the Lease
Agreement was amended to require annual rental payments of
$93,256. The Partnership's share of total acquisition
costs, including the cost of the land, was $924,843. The
remaining interests in the property are owned by AEI Real
Estate Fund XVII Limited Partnership, AEI Real Estate Fund
XVIII Limited Partnership and AEI Income & Growth Fund XXI
Limited Partnership, affiliates of the Partnership.
AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(3) Investments in Real Estate - (Continued)
On November 20, 1998, the Partnership purchased a parcel of
land in Homewood, Alabama for $696,000. The land is leased
to RTM Alabama, Inc. (RTM) under a Lease Agreement with a
primary term of 20 years and annual rental payments of
$46,980. Simultaneously with the purchase of the land, the
Partnership entered into a Development Financing Agreement
under which the Partnership advanced funds to RTM for the
construction of an Arby's restaurant on the site. The
Partnership charged interest on the advances at a rate of
6.75%. On July 9, 1999, after the development was
completed, the Lease Agreement was amended to require annual
rental payments of $87,135. Total acquisition costs,
including the cost of the land, were $1,392,592.
On November 25, 1998, the Partnership purchased a parcel of
land in Fort Wayne, Indiana for $470,000. The land is
leased to Tumbleweed, Inc. (TWI) under a Lease Agreement
with a primary term of 15 years and annual rental payments
of $39,950. Effective March 24, 1999, the annual rent was
increased to $48,175. Simultaneously with the purchase of
the land, the Partnership entered into a Development
Financing Agreement under which the Partnership advanced
funds to TWI for the construction of a Tumbleweed restaurant
on the site. Initially, the Partnership charged interest on
the advances at a rate of 8.5%. Effective March 24, 1999,
the interest rate was increased to 10.25%. On August 31,
1999, after the development was completed, the Lease
Agreement was amended to require annual rental payments of
$130,941. Total acquisition costs, including the cost of
the land, were $1,316,695.
On January 26, 1999, the Partnership purchased a Hollywood
Video store in Saraland, Alabama for $1,377,891. The
property is leased to Hollywood Entertainment Corp. under a
Lease Agreement with a primary term of 15 years and annual
rental payments of $129,617.
On July 14, 1999, the Partnership purchased four Children's
World daycare centers located in Abingdon, Maryland,
Houston, Texas, Pearland, Texas and DePere, Wisconsin. The
properties were purchased for $1,051,772, $892,219, $943,415
and $1,187,452, respectively. The properties are leased to
ARAMARK Educational Resources, Inc. under Lease Agreements
with primary terms of 15 years and annual rental payments of
$91,677, $79,093, $83,635 and $106,157, respectively.
On July 16, 1999, the Partnership purchased a Hollywood
Video store in Minot, North Dakota for $1,330,000. The
property is leased to Hollywood Entertainment Corporation
under a Lease Agreement with a primary term of 15 years and
annual rental payments of $129,168.
On August 26, 1999, the Partnership purchased a Hollywood
Video store in Muscle Shoals, Alabama for $1,340,627. The
property is leased to Hollywood Entertainment Corporation
under a Lease Agreement with a primary term of 15 years and
annual rental payments of $129,659.
AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(3) Investments in Real Estate - (Continued)
On September 28, 1999, the Partnership purchased a 53%
interest in a Marie Callender's restaurant in Henderson,
Nevada for $937,897. The property is leased to Marie
Callender Pie Shops, Inc. under a Lease Agreement with a
primary term of 15 years and annual rental payments of
$85,595. The remaining interest in the property was
purchased by AEI Net Lease Income & Growth Fund XIX Limited
Partnership, an affiliate of the Partnership.
During the three months ended March 31, 2000, the
Partnership sold 48.7463% of the Children's World in DePere,
Wisconsin in three separate transactions to unrelated third
parties. The Partnership received total net sale proceeds
of $664,679, which resulted in a total net gain of $97,805.
The total cost and related accumulated depreciation of the
interests sold was $578,839 and $11,965, respectively.
During the three months ended March 31, 2000, the
Partnership sold 36.5867% of its interest in the Marie
Callender's restaurant in three separate transactions to
unrelated third parties. The Partnership received total net
sale proceeds of $721,439, which resulted in a total net
gain of $80,695. The total cost and related accumulated
depreciation of the interests sold was $647,445 and $6,701,
respectively.
Subsequent to March 31, 2000, the Partnership sold an
additional 10.1238% of its interest in the Marie Callender's
restaurant to an unrelated third party. The Partnership
received net sale proceeds of approximately $195,000, which
resulted in a net gain of approximately $18,000.
During the three months ended March 31, 2000, the
Partnership sold 12.1242% of the Hollywood Video store in
Saraland, Alabama to an unrelated third party. The
Partnership received total net sale proceeds of $205,263,
which resulted in a total net gain of $42,920. The total
cost and related accumulated depreciation of the interest
sold was $167,058 and $4,715, respectively.
Subsequent to March 31, 2000, the Partnership sold an
additional 12.5832% of the Hollywood Video store in
Saraland, Alabama to an unrelated third party. The
Partnership received net sale proceeds of approximately
$209,000, which resulted in a net gain of approximately
$41,000.
During the first three months of 2000, the Partnership
distributed $34,582 of the net sale proceeds to the Limited
and General Partners as part of their regular quarterly
distributions which represented a return of capital of $1.98
per Limited Partnership Unit.
The Partnership has incurred net costs of $7,068 relating to
the review of potential property acquisitions which have
been capitalized and will be allocated to properties
acquired in future periods.
AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(4) Payable to AEI Fund Management, Inc. -
AEI Fund Management, Inc. performs the administrative and
operating functions for the Partnership. The payable to AEI
Fund Management represents the balance due for those
services. This balance is non-interest bearing and
unsecured and is to be paid in the normal course of
business.
ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS
Results of Operations
For the three months ended March 31, 2000 and 1999, the
Partnership recognized rental income of $298,260 and $82,627,
respectively. During the same periods, the Partnership earned
$6,180 and $112,245, respectively, in investment income from
subscription proceeds which were invested in short-term money
market accounts. This investment income constituted 2% and 58%,
respectively, of total income. The percentage of total income
represented by investment income declines as subscription
proceeds are invested in properties.
During the three months ended March 31, 2000 and 1999, the
Partnership paid Partnership administration expenses to
affiliated parties of $39,026 and $43,213, respectively. These
administration expenses include costs associated with the
management of the properties, processing distributions, reporting
requirements and correspondence to the Limited Partners. During
the same period, the Partnership incurred Partnership
administration and property management expenses from unrelated
parties of $13,968 and $8,905, respectively. These expenses
represent direct payments to third parties for legal and filing
fees, direct administrative costs, outside audit and accounting
costs, taxes, insurance and other property costs.
As of March 31, 2000, the Partnership's cash distribution
rate was 6.0% on an annualized basis. Pursuant to the
Partnership Agreement, distributions of Net Cash Flow and Net
Income were allocated 97% to the Limited Partners and 3% to the
General Partners.
Since the Partnership has only recently purchased its real
estate, inflation has had a minimal effect on income from
operations. The Leases may contain cost of living increases
which will result in an increase in rental income over the term
of the Leases. Inflation also may cause the Partnership's real
estate to appreciate in value. However, inflation and changing
prices may also have an adverse impact on the operating margins
of the properties' tenants which could impair their ability to
pay rent and subsequently reduce the Partnership's Net Cash Flow
available for distributions.
Liquidity and Capital Resources
During the three months ended March 31, 2000, the
Partnership's cash balances increased $1,722,039 mainly as a
result of cash generated from the sale of property. Net cash
provided by operating activities increased from $31,484 in 1999
to $399,330 in 2000 as a result of an increase in income in 2000
and net timing differences in the collection of payments from the
lessees and the payment of expenses.
ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued)
The major components of the Partnership's cash flow from
investing activities are investments in real estate and proceeds
from the sale of real estate. During the three months ended
March 31, 2000 and 1999, the Partnership expended $7,068 and
$2,268,192, respectively, to invest in real properties (inclusive
of acquisition expenses). During the three months ended March
31, 2000, the Partnership generated cash flow from the sale of
real estate of $1,591,381.
On June 29, 1998, the Partnership purchased a parcel of
land in Centerville, Ohio for $1,850,988. On August 28, 1998,
the Partnership assigned, for diversification purposes, 77% of
its interest in the property to three affiliated partnerships.
The land is leased to Americana Dining Corporation (ADC) under a
Lease Agreement with a primary term of 20 years and annual rental
payments of $29,801. Effective December 25, 1998, the annual
rent was increased to $44,701. Simultaneously with the purchase
of the land, the Partnership entered into a Development Financing
Agreement under which the Partnership advanced funds to ADC for
the construction of a Champps Americana restaurant on the site.
Initially, the Partnership charged interest on the advances at a
rate of 7.0%. Effective December 25, 1998, the interest rate was
increased to 10.5%. On January 27, 1999, after the development
was completed, the Lease Agreement was amended to require annual
rental payments of $93,256. The Partnership's share of total
acquisition costs, including the cost of the land, was $924,843.
The remaining interests in the property are owned by AEI Real
Estate Fund XVII Limited Partnership, AEI Real Estate Fund XVIII
Limited Partnership and AEI Income & Growth Fund XXI Limited
Partnership, affiliates of the Partnership.
On November 20, 1998, the Partnership purchased a parcel
of land in Homewood, Alabama for $696,000. The land is leased to
RTM Alabama, Inc. (RTM) under a Lease Agreement with a primary
term of 20 years and annual rental payments of $46,980.
Simultaneously with the purchase of the land, the Partnership
entered into a Development Financing Agreement under which the
Partnership advanced funds to RTM for the construction of an
Arby's restaurant on the site. The Partnership charged interest
on the advances at a rate of 6.75%. On July 9, 1999, after the
development was completed, the Lease Agreement was amended to
require annual rental payments of $87,135. Total acquisition
costs, including the cost of the land, were $1,392,592.
On November 25, 1998, the Partnership purchased a parcel
of land in Fort Wayne, Indiana for $470,000. The land is leased
to Tumbleweed, Inc. (TWI) under a Lease Agreement with a primary
term of 15 years and annual rental payments of $39,950.
Effective March 24, 1999, the annual rent was increased to
$48,175. Simultaneously with the purchase of the land, the
Partnership entered into a Development Financing Agreement under
which the Partnership advanced funds to TWI for the construction
of a Tumbleweed restaurant on the site. Initially, the
Partnership charged interest on the advances at a rate of 8.5%.
Effective March 24, 1999, the interest rate was increased to
10.25%. On August 31, 1999, after the development was completed,
the Lease Agreement was amended to require annual rental payments
of $130,941. Total acquisition costs, including the cost of the
land, were $1,316,695.
On January 26, 1999, the Partnership purchased a Hollywood
Video store in Saraland, Alabama for $1,377,891. The property is
leased to Hollywood Entertainment Corp. under a Lease Agreement
with a primary term of 15 years and annual rental payments of
$129,617.
ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued)
On July 14, 1999, the Partnership purchased four
Children's World daycare centers located in Abingdon, Maryland,
Houston, Texas, Pearland, Texas and DePere, Wisconsin. The
properties were purchased for $1,051,772, $892,219, $943,415 and
$1,187,452, respectively. The properties are leased to ARAMARK
Educational Resources, Inc. under Lease Agreements with primary
terms of 15 years and annual rental payments of $91,677, $79,093,
$83,635 and $106,157, respectively.
On July 16, 1999, the Partnership purchased a Hollywood
Video store in Minot, North Dakota for $1,330,000. The property
is leased to Hollywood Entertainment Corporation under a Lease
Agreement with a primary term of 15 years and annual rental
payments of $129,168.
On August 26, 1999, the Partnership purchased a Hollywood
Video store in Muscle Shoals, Alabama for $1,340,627. The
property is leased to Hollywood Entertainment Corporation under a
Lease Agreement with a primary term of 15 years and annual rental
payments of $129,659.
On September 28, 1999, the Partnership purchased a 53%
interest in a Marie Callender's restaurant in Henderson, Nevada
for $937,897. The property is leased to Marie Callender Pie
Shops, Inc. under a Lease Agreement with a primary term of 15
years and annual rental payments of $85,595. The remaining
interest in the property was purchased by AEI Net Lease Income &
Growth Fund XIX Limited Partnership, an affiliate of the
Partnership.
During the three months ended March 31, 2000, the
Partnership sold 48.7463% of the Children's World in DePere,
Wisconsin in three separate transactions to unrelated third
parties. The Partnership received total net sale proceeds of
$664,679, which resulted in a total net gain of $97,805. The
total cost and related accumulated depreciation of the interests
sold was $578,839 and $11,965, respectively.
During the three months ended March 31, 2000, the
Partnership sold 36.5867% of its interest in the Marie
Callender's restaurant in three separate transactions to
unrelated third parties. The Partnership received total net sale
proceeds of $721,439, which resulted in a total net gain of
$80,695. The total cost and related accumulated depreciation of
the interests sold was $647,445 and $6,701, respectively.
Subsequent to March 31, 2000, the Partnership sold an
additional 10.1238% of its interest in the Marie Callender's
restaurant to an unrelated third party. The Partnership received
net sale proceeds of approximately $195,000, which resulted in a
net gain of approximately $18,000.
During the three months ended March 31, 2000, the
Partnership sold 12.1242% of the Hollywood Video store in
Saraland, Alabama to an unrelated third party. The Partnership
received total net sale proceeds of $205,263, which resulted in a
total net gain of $42,920. The total cost and related
accumulated depreciation of the interest sold was $167,058 and
$4,715, respectively.
Subsequent to March 31, 2000, the Partnership sold an
additional 12.5832% of the Hollywood Video store in Saraland,
Alabama to an unrelated third party. The Partnership received
net sale proceeds of approximately $209,000, which resulted in a
net gain of approximately $41,000.
ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued)
During the first three months of 2000, the Partnership
distributed $34,582 of the net sale proceeds to the Limited and
General Partners as part of their regular quarterly distributions
which represented a return of capital of $1.98 per Limited
Partnership Unit.
The Partnership's primary use of cash flow is distribution
and redemption payments to Partners. The Partnership declares
its regular quarterly distributions before the end of each
quarter and pays the distribution in the first week after the end
of each quarter. The Partnership attempts to maintain a stable
distribution rate from quarter to quarter. Redemption payments
are paid to redeeming Partners on a semi-annual basis.
The Partnership may acquire Units from Limited Partners
who have tendered their Units to the Partnership. Such Units may
be acquired at a discount. The Partnership is not obligated to
purchase in any year more than 5% of the number of Units
outstanding at the beginning of the year. In no event shall the
Partnership be obligated to purchase Units if, in the sole
discretion of the Managing General Partner, such purchase would
impair the capital or operation of the Partnership.
On April 1, 2000, two Limited Partners redeemed a total of
9.67 Partnership Units for $7,099 in accordance with the
Partnership Agreement. The Partnership acquired these Units
using Net Cash Flow from operations. In 1999, four Limited
Partners redeemed a total of 109.04 Partnership Units for
$87,231. The redemptions increase the remaining Limited
Partners' ownership interest in the Partnership.
The continuing rent payments from the properties, together
with cash generated from property sales, should be adequate to
fund continuing distributions and meet other Partnership
obligations on both a short-term and long-term basis.
ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued)
Cautionary Statement for Purposes of the "Safe Harbor" Provisions
of the Private Securities Litigation Reform Act of 1995
The foregoing Management's Discussion and Analysis
contains various "forward looking statements" within the meaning
of federal securities laws which represent management's
expectations or beliefs concerning future events, including
statements regarding anticipated application of cash, expected
returns from rental income, growth in revenue, taxation levels,
the sufficiency of cash to meet operating expenses, rates of
distribution, and other matters. These, and other forward
looking statements made by the Partnership, must be evaluated in
the context of a number of factors that may affect the
Partnership's financial condition and results of operations,
including the following:
<BULLET> Market and economic conditions which affect
the value of the properties the Partnership owns and
the cash from rental income such properties generate;
<BULLET> the federal income tax consequences of rental
income, deductions, gain on sales and other items and
the affects of these consequences for investors;
<BULLET> resolution by the General Partners of
conflicts with which they may be confronted;
<BULLET> the success of the General Partners of
locating properties with favorable risk return
characteristics;
<BULLET> the effect of tenant defaults; and
<BULLET> the condition of the industries in which the
tenants of properties owned by the Partnership operate.
PART II - OTHER INFORMATION
ITEM 1.LEGAL PROCEEDINGS
There are no material pending legal proceedings to which
the Partnership is a party or of which the Partnership's
property is subject.
ITEM 2.CHANGES IN SECURITIES
None.
ITEM 3.DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4.SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5.OTHER INFORMATION
None.
PART II - OTHER INFORMATION
(Continued)
ITEM 6.EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits -
Description
10.1 Purchase Agreement dated March 16,
2000 between the Partnership and George
M. Kunitake and Kay H. Kunitake, husband
and wife, and Steven T. Kunitake relating
to the property at 1553 Arcadian Drive,
DePere, Wisconsin.
10.2 Property Co-Tenancy Ownership
Agreement dated March 24, 2000 between
the Partnership and George M. Kunitake
and Kay H. Kunitake, husband and wife,
and Steven T. Kunitake relating to the
property at 1553 Arcadian Drive, DePere,
Wisconsin.
10.3 Purchase Agreement dated March 27,
2000 between the Partnership and the Carl
R. Whittington Trust relating to the
property at 1553 Arcadian Drive, DePere,
Wisconsin.
10.4 Purchase Agreement dated March 27,
2000 between the Partnership and the Carl
R. Whittington Trust relating to the
property at 530 North Stephanie Street,
Henderson, Nevada.
10.5 Purchase Agreement dated March 27,
2000 between the Partnership and the Carl
R. Whittington Trust relating to the
property at 1097 Industrial Parkway,
Saraland, Alabama.
10.6 Property Co-Tenancy Ownership
Agreement dated March 30, 2000 between
the Partnership and the Carl R.
Whittington Trust relating to the
property at 1097 Industrial Parkway,
Saraland, Alabama.
10.7 Property Co-Tenancy Ownership
Agreement dated March 30, 2000 between
the Partnership and the Carl R.
Whittington Trust relating to the
property at 1553 Arcadian Drive, DePere,
Wisconsin.
10.8 Purchase Agreement dated April 13,
2000 between the Partnership and Francis
E. Quinn and Cecile Ann Quinn relating to
the property at 530 North Stephanie
Street, Henderson, Nevada.
10.9 Purchase Agreement dated April 18,
2000 between the Partnership and the
Wuest Estate Company relating to the
property at 1097 Industrial Parkway,
Saraland, Alabama.
PART II - OTHER INFORMATION
(Continued)
ITEM 6.EXHIBITS AND REPORTS ON FORM 8-K (Continued)
a. Exhibits -
Description
10.10 Property Co-Tenancy Ownership
Agreement dated April 21, 2000 between
the Partnership and the Wuest Estate
Company relating to the property at 1097
Industrial Parkway, Saraland, Alabama.
27 Financial Data Schedule for period
ended March 31, 2000.
b. Reports filed on Form 8-K - None.
SIGNATURES
In accordance with the requirements of the Exchange Act,
the Registrant has caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
Dated: May 5, 2000 AEI Income & Growth Fund XXII
Limited Partnership
By: AEI Fund Management XXI, Inc.
Its: Managing General Partner
By: /s/ Robert P. Johnson
Robert P. Johnson
President
(Principal Executive Officer)
By: /s/ Mark E. Larson
Mark E. Larson
Chief Financial Officer
(Principal Accounting Officer)
PURCHASE AGREEMENT
Children's World - DePere, WI
This AGREEMENT, entered into effective as of the 16th of March,
2000.
l. PARTIES. Seller is AEI Income & Growth Fund XXII Limited
Partnership which owns an undivided 82.7896% interest in the fee
title to that certain real property legally described in the
attached Exhibit "A" (the "Entire Property") Buyer is George M.
Kunitake and Kay H. Kunitake, husband and wife as joint tenants,
and Steven T. Kunitake, a married man as his sole and separate
property, all as joint tenants ("Buyer"). Seller wishes to sell
and Buyer wishes to buy a portion as Tenant in Common of Seller's
interest in the Entire Property.
2. PROPERTY. The Property to be sold to Buyer in this transaction
consists of an undivided 16.7323 percentage interest
(hereinafter, simply the "Property") as Tenant in Common in the
Entire Property.
3. PURCHASE PRICE. The purchase price for this percentage
interest in the Entire Property is $245,000, all cash.
4. TERMS. The purchase price for the Property will be paid by
Buyer as follows:
(a) When this agreement is executed, Buyer will pay $5,000
to Seller (which shall be deposited into escrow according to
the terms hereof) (the "First Payment"). The First Payment
will be credited against the purchase price when and if
escrow closes and the sale is completed.
(b) Buyer will deposit the balance of the purchase price,
$240,000 (the "Second Payment") into escrow in sufficient
time to allow escrow to close on the closing date.
5. CLOSING DATE. Escrow shall close on or before March 31, 2000.
6. DUE DILIGENCE. Buyer will have until the expiration of the
fifth business day (The "Review Period") after delivery of each
of following items, to be supplied by Seller, to conduct all of
its inspections and due diligence and satisfy itself regarding
each item, the Property, and this transaction. Buyer agrees to
indemnify and hold Seller harmless for any loss or damage to the
Entire Property or persons caused by Buyer or its agents arising
out of such physical inspections of the Entire Property.
(a) The original and one copy of a title insurance
commitment for an Owner's Title insurance policy (see
paragraph 8 below).
(b) Copies of a Certificate of Occupancy or other such
document certifying completion and granting permission to
permanently occupy the improvements on the Entire Property
as are in Seller's possession.
Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK
Purchase Agreement for Children's World, DePere, WI
(c) Copies of an "as built" survey of the Entire Property
done concurrent with Seller's acquisition of the Property.
(d) Lease (as further set forth in paragraph 11(a) below) of
the Entire Property showing occupancy date, lease expiration
date, rent, and Guarantys, if any, accompanied by such
tenant financial statements as may have been provided most
recently to Seller by the Tenant and/or Guarantors.
It is a contingency upon Seller's obligations hereunder that
two (2) copies of Co-Tenancy Agreement in the form attached
hereto duly executed by Buyer and Seller and dated on escrow
closing date be delivered to the Seller on the closing date.
Buyer may cancel this agreement for ANY REASON in its sole
discretion by delivering a cancellation notice, return receipt
requested, to Seller and escrow holder before the expiration of
the Review Period. Such notice shall be deemed effective only
upon receipt by Seller. If this Agreement is not cancelled as
set forth above, the First Payment shall be non-refundable unless
Seller shall default hereunder.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under the first paragraph of section 6 of this
agreement (which will survive), Buyer (after execution of such
documents reasonably requested by Seller to evidence the
termination hereof) shall be returned its First Payment, and
Buyer will have absolutely no rights, claims or interest of any
type in connection with the Property or this transaction,
regardless of any alleged conduct by Seller or anyone else.
Unless this Agreement is canceled by Buyer pursuant to the
terms hereof, if Buyer fails to make the Second Payment, Seller
shall be entitled to retain the First Payment and Buyer
irrevocably will be deemed to be in default under this Agreement.
Seller may, at its option, retain the First Payment and declare
this Agreement null and void, in which event Buyer will be deemed
to have canceled this Agreement and relinquish all rights in and
to the Property or Seller may exercise its rights under Section
14 hereof. If this Agreement is not canceled and the Second
Payment is made when required, all of Buyer's conditions and
contingencies will be deemed satisfied.
7. ESCROW. Escrow shall be opened by Seller and funds deposited
in escrow upon acceptance of this agreement by both parties. The
escrow holder will be a nationally-recognized escrow company
selected by Seller. A copy of this Agreement will be delivered to
the escrow holder and will serve as escrow instructions together
with the escrow holder's standard instructions and any additional
instructions required by the escrow holder to clarify its rights
and duties (and the parties agree to sign these additional
instructions). If there is any conflict between these other
instructions and this Agreement, this Agreement will control.
8. TITLE. Closing will be conditioned on the commitment of a
title company selected by Seller to issue an Owner's policy of
title insurance, dated as of the close of escrow, in an amount
equal to the purchase price, insuring that Buyer will own
insurable title to the Property subject only to: the title
company's standard exceptions; current real property taxes and
assessments; survey
Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK
Purchase Agreement for Children's World, DePere, WI
exceptions; the rights of parties in possession pursuant to the
lease defined in paragraph 11 below; all matters of public
record; and other items disclosed to Buyer during the Review
Period.
Buyer shall be allowed five (5) days after receipt of said
commitment for examination and the making of any objections to
marketability thereto, said objections to be made in writing or
deemed waived. If any objections are so made, the Seller shall
be allowed eighty (80) days to make such title marketable or in
the alternative to obtain a commitment for insurable title
insuring over Buyer's objections. If Seller shall decide to make
no efforts to make title marketable, or is unable to make title
marketable or obtain insurable title, (after execution by Buyer
of such documents reasonably requested by Seller to evidence the
termination hereof) Buyer's First Payment shall be returned and
this Agreement shall be null and void and of no further force and
effect.
Pending correction of title, the payments hereunder required
shall be postponed, but upon correction of title and within ten
(10) days after written notice of correction to the Buyer, the
parties shall perform this Agreement according to its terms.
9. CLOSING COSTS. Seller will pay one-half of escrow fees, the
cost of the title commitment and any brokerage commissions
payable. The Buyer will pay the cost of issuing a Standard
Owners Title Insurance Policy in the full amount of the purchase
price, if Buyer shall decide to purchase the same. Buyer will
pay all recording fees, one-half of the escrow fees, and the cost
of an update to the Survey in Sellers possession (if an update is
required by Buyer.) Each party will pay its own attorney's fees
and costs to document and close this transaction.
10. REAL ESTATE TAXES, SPECIAL ASSESSMENTS AND PRORATIONS.
(a) Because the Entire Property (of which the Property is a
part) is subject to a triple net lease (as further set forth
in paragraph 11(a)(i), the parties acknowledge that there
shall be no need for a real estate tax proration. However,
Seller represents that to the best of its knowledge, all
real estate taxes and installments of special assessments
due and payable in all years prior to the year of Closing
have been paid in full. Unpaid real estate taxes and unpaid
levied and pending special assessments for the year of
Closing shall be the responsibility of Buyer and Seller in
proportion to their respective Tenant in Common interests,
pro-rated, however, to the date of closing for the period
prior to closing, which shall be the responsibility of
Seller if Tenant shall not pay the same. Seller and Buyer
shall likewise pay all taxes due and payable in the year
after Closing and any unpaid installments of special
assessments payable therewith and thereafter, if such unpaid
levied and pending special assessments and real estate taxes
are not paid by any tenant of the Entire Property.
(b) All income and all operating expenses from the Entire
Property shall be prorated between the parties and adjusted by
them as of the date of Closing. Seller shall be entitled to all
income earned and shall be responsible for all expenses incurred
prior to the date of Closing, and Buyer shall be entitled to its
proportionate share of all income earned
Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK
Purchase Agreement for Children's World, DePere, WI
and shall be responsible for its proportionate share of all
operating expenses of the Entire Property incurred on and
after the date of closing.
11. SELLER'S REPRESENTATION AND AGREEMENTS.
(a) Seller represents and warrants as of this date that:
(i) Except for the Net Lease Agreement in existence between
AEI Income & Growth Fund XXII Limited Partnership and
ARAMARK Educational Resources, Inc., f/k/a Children's World
Learning Centers, Inc., dated July 14, 1999, Seller is not
aware of any leases of the Property.
(ii) It is not aware of any pending litigation or
condemnation proceedings against the Property or Seller's
interest in the Property.
(iii) Except as previously disclosed to Buyer and as set
forth in paragraph (b) below, Seller is not aware of any
contracts Seller has executed that would be binding on Buyer
after the closing date.
(b) Provided that Buyer performs its obligations when
required, Seller agrees that it will not enter into any new
contracts that would materially affect the Property and be
binding on Buyer after the Closing Date without Buyer's
prior consent, which will not be unreasonably withheld.
However, Buyer acknowledges that Seller retains the right
both prior to and after the Closing Date to freely transfer
all or a portion of Seller's remaining undivided interest in
the Entire Property, provided such sale shall not encumber
the Property being purchased by Buyer in violation of the
terms hereof or the contemplated Co-Tenancy Agreement.
12. DISCLOSURES.
(a) To the best of Seller's knowledge: there are now, and
at the Closing there will be, no material, physical or
mechanical defects of the Property, including, without
limitation, the plumbing, heating, air conditioning,
ventilating, electrical systems, and all such items are in
good operating condition and repair and in compliance with
all applicable governmental , zoning and land use laws,
ordinances, regulations and requirements.
(b) To the best of Seller's knowledge: the use and
operation of the Property now is, and at the time of Closing
will be, in full compliance with applicable building codes,
safety, fire, zoning, and land use laws, and other
applicable local, state and federal laws, ordinances,
regulations and requirements.
(c) Seller knows of no facts nor has Seller failed to
disclose to Buyer any fact known to Seller which would
prevent Buyer from using and operating the Property after
the Closing in the manner in which the Property has been
used and operated prior to the date of this Agreement.
Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK
Purchase Agreement for Children's World, DePere, WI
(d) To the best of Seller's knowledge: the Property is not,
and as of the Closing will not be, in violation of any
federal, state or local law, ordinance or regulations
relating to industrial hygiene or to the environmental
conditions on, under, or about the Property including, but
not limited to, soil and groundwater conditions. To the
best of Seller's knowledge: there is no proceeding or
inquiry by any governmental authority with respect to the
presence of Hazardous Materials on the Property or the
migration of Hazardous Materials from or to other property.
Buyer agrees that Seller will have no liability of any type
to Buyer or Buyer's successors, assigns, or affiliates in
connection with any Hazardous Materials on or in connection
with the Property either before or after the Closing Date,
except as provided under applicable state or federal laws or
regulations.
(e) BUYER AGREES THAT IT SHALL BE PURCHASING THE PROPERTY
IN ITS THEN PRESENT CONDITION, AS IS, WHERE IS, AND SELLER
HAS NO OBLIGATIONS TO CONSTRUCT OR REPAIR ANY IMPROVEMENTS
THEREON OR TO PERFORM ANY OTHER ACT REGARDING THE PROPERTY,
EXCEPT AS EXPRESSLY PROVIDED HEREIN.
(f) BUYER ACKNOWLEDGES THAT, HAVING BEEN GIVEN THE OPPORTUNITY
TO INSPECT THE PROPERTY AND SUCH FINANCIAL INFORMATION ON THE
LESSEE AND GUARANTORS OF THE LEASE AS BUYER OR ITS ADVISORS SHALL
REQUEST, BUYER IS RELYING SOLELY ON ITS OWN INVESTIGATION OF THE
PROPERTY AND NOT ON ANY INFORMATION PROVIDED BY SELLER OR TO BE
PROVIDED EXCEPT AS SET FORTH HEREIN. BUYER FURTHER ACKNOWLEDGES
THAT THE INFORMATION PROVIDED AND TO BE PROVIDED BY SELLER WITH
RESPECT TO THE PROPERTY AND TO THE LESSEE AND GUARANTORS OF LEASE
WAS OBTAINED FROM A VARIETY OF SOURCES AND SELLER NEITHER (A) HAS
MADE INDEPENDENT INVESTIGATION OR VERIFICATION OF SUCH
INFORMATION, OR (B) MAKES ANY REPRESENTATIONS AS TO THE ACCURACY
OR COMPLETENESS OF SUCH INFORMATION. THE SALE OF THE PROPERTY AS
PROVIDED FOR HEREIN IS MADE ON AN "AS IS" BASIS, AND BUYER
EXPRESSLY ACKNOWLEDGES THAT, IN CONSIDERATION OF THE AGREEMENTS
OF SELLER HEREIN, EXCEPT AS OTHERWISE SPECIFIED HEREIN, SELLER
MAKES NO WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, OR
ARISING BY OPERATION OF LAW, INCLUDING, BUT NOT LIMITED TO, ANY
WARRANTY OR CONDITION, HABITABILITY, TENANTABILITY, SUITABILITY
FOR COMMERCIAL PURPOSES, MERCHANTABILITY, OR FITNESS FOR A
PARTICULAR PURPOSE, IN RESPECT OF THE PROPERTY.
The provisions (d) - (f) above shall survive closing.
13. CLOSING.
(a) Before the closing date, Seller will deposit into
escrow an executed limited warranty deed conveying insurable
title of the Property to Buyer, subject to the encumbrances
contained in paragraph 8 above.
(b) On or before the closing date, Buyer will deposit into
escrow: the balance of the purchase price when required under
Section 4; any additional funds required of Buyer,
Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK
Purchase Agreement for Children's World, DePere, WI
(pursuant to this agreement or any other agreement executed
by Buyer) to close escrow. Both parties will sign and
deliver to the escrow holder any other documents reasonably
required by the escrow holder to close escrow.
(c) On the closing date, if escrow is in a position to
close, the escrow holder will: record the deed in the
official records of the county where the Property is
located; cause the title company to commit to issue the
title policy; immediately deliver to Seller the portion of
the purchase price deposited into escrow by cashier's check
or wire transfer (less debits and prorations, if any);
deliver to Seller and Buyer a signed counterpart of the
escrow holder's certified closing statement and take all
other actions necessary to close escrow.
14. DEFAULTS. If Buyer defaults, Buyer will forfeit all rights
and claims and Seller will be relieved of all obligations and
will be entitled to retain all monies heretofore paid by the
Buyer. In addition, Seller shall retain all remedies available
to Seller at law or in equity.
If Seller shall default, Buyer irrevocably waives any rights
to file a lis pendens, a specific performance action or any other
claim, action or proceeding of any type in connection with the
Property or this or any other transaction involving the Property,
and will not do anything to affect title to the Property or
hinder, delay or prevent any other sale, lease or other
transaction involving the Property (any and all of which will be
null and void), unless: it has paid the First Payment, deposited
the balance of the Second Payment for the purchase price into
escrow, performed all of its other obligations and satisfied all
conditions under this Agreement, and unconditionally notified
Seller that it stands ready to tender full performance, purchase
the Property and close escrow as per this Agreement, regardless
of any alleged default or misconduct by Seller. Provided,
however, that in no event shall Seller be liable for any
punitive, consequential or speculative damages arising out of any
default by Seller hereunder.
15. BUYER'S REPRESENTATIONS AND WARRANTIES.
a. Buyer represents and warrants to Seller as follows:
(i) In addition to the acts and deeds recited herein and
contemplated to be performed, executed, and delivered by
Buyer, Buyer shall perform, execute and deliver or cause to
be performed, executed, and delivered at the Closing or
after the Closing, any and all further acts, deeds and
assurances as Seller or the Title Company may require and be
reasonable in order to consummate the transactions
contemplated herein.
(ii) Buyer has all requisite power and authority to
consummate the transaction contemplated by this Agreement
and has by proper proceedings duly authorized the execution
and delivery of this Agreement and the consummation of the
transaction contemplated hereby.
(iii) To Buyer's knowledge, neither the execution and
delivery of this Agreement nor the consummation of the
transaction contemplated hereby will violate or be in conflict
with (a) any applicable provisions of law, (b) any order of any
court or other agency of
Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK
Purchase Agreement for Children's World, DePere, WI
government having jurisdiction hereof, or (c) any agreement
or instrument to which Buyer is a party or by which Buyer is
bound.
16. DAMAGES, DESTRUCTION AND EMINENT DOMAIN.
(a) If, prior to closing, the Property or any part thereof
is destroyed or further damaged by fire, the elements, or
any cause, due to events occurring subsequent to the date of
this Agreement to the extent that the cost of repair exceeds
$10,000.00, this Agreement shall become null and void, at
Buyer's option exercised, if at all, by written notice to
Seller within ten (10) days after Buyer has received written
notice from Seller of said destruction or damage. Seller,
however, shall have the right to adjust or settle any
insured loss until (i) all contingencies set forth in
Paragraph 6 hereof have been satisfied, or waived; and (ii)
any ten-day period provided for above in this Subparagraph
16a for Buyer to elect to terminate this Agreement has
expired or Buyer has, by written notice to Seller, waived
Buyer's right to terminate this Agreement. If Buyer elects
to proceed and to consummate the purchase despite said
damage or destruction, there shall be no reduction in or
abatement of the purchase price, and Seller shall assign to
Buyer the Seller's right, title, and interest in and to all
insurance proceeds (pro-rata in relation to the Entire
Property) resulting from said damage or destruction to the
extent that the same are payable with respect to damage to
the Property, subject to rights of any Tenant of the Entire
Property.
If the cost of repair is less than $10,000.00, Buyer shall
be obligated to otherwise perform hereinunder with no
adjustment to the Purchase Price, reduction or abatement,
and Seller shall assign Seller's right, title and interest
in and to all insurance proceeds pro-rata in relation to the
Entire Property, subject to rights of any Tenant of the
Entire Property.
(b) If, prior to closing, the Property, or any part
thereof, is taken by eminent domain, this Agreement shall
become null and void, at Buyer's option. If Buyer elects to
proceed and to consummate the purchase despite said taking,
there shall be no reduction in, or abatement of, the
purchase price, and Seller shall assign to Buyer the
Seller's right, title, and interest in and to any award
made, or to be made, in the condemnation proceeding pro-rata
in relation to the Entire Property, subject to rights of any
Tenant of the Entire Property.
In the event that this Agreement is terminated by Buyer as
provided above in Subparagraph 16a or 16b, the First Payment
shall be immediately returned to Buyer (after execution by Buyer
of such documents reasonably requested by Seller to evidence the
termination hereof).
Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK
Purchase Agreement for Children's World, DePere, WI
17. BUYER'S 1031 TAX FREE EXCHANGE.
While Seller acknowledges that Buyer is purchasing the
Property as "replacement property" to accomplish a tax free
exchange, Buyer acknowledges that Seller has made no
representations, warranties, or agreements to Buyer or Buyer's
agents that the transaction contemplated by the Agreement will
qualify for such tax treatment, nor has there been any reliance
thereon by Buyer respecting the legal or tax implications of the
transactions contemplated hereby. Buyer further represents that
it has sought and obtained such third party advice and counsel as
it deems necessary in regards to the tax implications of this
transaction.
Buyer wishes to novate/assign the ownership rights and
interest of this Purchase Agreement to First Guaranty Exchange
which will act as Accommodator to perfect the 1031 exchange by
preparing an agreement of exchange of Real Property whereby First
Guaranty Exchange will be an independent third party purchasing
the ownership interest in subject property from Seller and
selling the ownership interest in subject property to Buyer under
the same terms and conditions as documented in this Purchase
Agreement. Buyer asks the Seller, and Seller agrees to cooperate
in the perfection of such an exchange if at no additional cost or
expense to Seller or delay in time. Buyer hereby indemnifies and
holds Seller harmless from any claims and/or actions resulting
from said exchange. Pursuant to the direction of First Guaranty
Exchange, Seller will deed the Property to Buyer.
18. CANCELLATION
If any party elects to cancel this Contract because of any
breach by another party or because escrow fails to close by
the agreed date, the party electing to cancel shall deliver
to escrow agent a notice containing the address of the party
in breach and stating that this Contract shall be cancelled
unless the breach is cured within 10 days following the
delivery of the notice to the escrow agent. Within three
days after receipt of such notice, the escrow agent shall
send it by United States Mail to the party in breach at the
address contained in the Notice and no further notice shall
be required. If the breach is not cured within the 10 days
following the delivery of the notice to the escrow agent,
this Contract shall be cancelled.
19. MISCELLANEOUS.
(a) This Agreement may be amended only by written agreement
signed by both Seller and Buyer, and all waivers must be in
writing and signed by the waiving party. Time is of the
essence. This Agreement will not be construed for or
against a party whether or not that party has drafted this
Agreement. If there is any action or proceeding between the
parties relating to this Agreement the prevailing party will
be entitled to recover attorney's fees and costs. This is
an integrated agreement containing all agreements of the
parties about the Property and the other matters described,
and it supersedes any other agreements or understandings.
Exhibits attached to this Agreement are incorporated into
this Agreement.
Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK
Purchase Agreement for Children's World, DePere, WI
(b) If this escrow has not closed by March 31, 2000,
through no fault of Seller, Seller may either, at its
election, extend the closing date or exercise any remedy
available to it by law, including terminating this
Agreement.
(c) Funds to be deposited or paid by Buyer must be good and
clear funds in the form of cash, cashier's checks or wire
transfers.
(d) All notices from either of the parties hereto to the
other shall be in writing and shall be considered to have
been duly given or served if sent by first class certified
mail, return receipt requested, postage prepaid, or by a
nationally recognized courier service guaranteeing overnight
delivery to the party at his or its address set forth below,
or to such other address as such party may hereafter
designate by written notice to the other party.
If to Seller:
Attention: Robert P. Johnson
AEI Income & Growth Fund XXII Limited Partnership
1300 Minnesota World Trade Center
30 E. 7th Street
St. Paul, MN 55101
If to Buyer:
George M. and Kay H. Kunitake
Steven T. Kunitake
153 Exeter
San Carlos, CA 94070
When accepted, this offer will be a binding agreement for
valid and sufficient consideration which will bind and benefit
Buyer, Seller and their respective successors and assigns. Buyer
is submitting this offer by signing a copy of this offer and
delivering it to Seller. Seller has five (5) business days from
receipt within which to accept this offer.
REST OF PAGE INTENTIONALLY LEFT BLANK
Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK
Purchase Agreement for Children's World, DePere, WI
IN WITNESS WHEREOF, the Seller and Buyer have executed this
Agreement effective as of the day and year above first written.
BUYER: George M. Kunitake and Kay H. Kunitake, husband and
wife as joint tenants, and Steven T. Kunitake, a married man as
his sole and separate property, all as joint tenants
By: /s/ George M Kunitake by Steven T Kunitake his atty
in fact
George M. Kunitake
By: /s/ Kay H Kunitake by Steven T Kunitake her atty in
fact
Kay H. Kunitake
By: /s/ Steven T Kunitake
Steven T. Kunitake
WITNESS:
(as to all signers)
/s/ Mary Kunitake
Mary Kunitake
(Print Name)
SELLER: AEI Income & Growth Fund XXII Limited Partnership, a Minnesota
limited partnership
By: AEI Fund Management XXI, Inc., its corporate general partner
By:/s/ Robert P Johnson
Robert P. Johnson, President
WITNESS:
/s/ Jill Rayburn
Jill Rayburn
(Print Name)
Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK
Purchase Agreement for Children's World, DePere, WI
EXHIBIT "A"
LEGAL DESCRIPTION
All of Lot One (1) of Volumnet 34 Certified Survey
Maps, Page 125, Brown County Records, and is located in
part of Government Lots 1 and 2, Section Thirty-five
(35) and part of Government Lot 1 and part of the
Southeast One-quarter of the Northeast, One-quarter (SE
1/4 - NE 1/4), Section Thirty-four (34), all being in
Township Twenty-three (23) North, Range Twenty (20)
East, in the Town of Ledgeview, Brown County,
Wisconsin.
and
Part of Lot One (1) of Volume 30 Certified Survey
Maps, Page 71, Brown County Records, being part of
Government Lots 1 and 2, Section Thirty-five (35),
Township Twenty-three (23) North, Range Twenty (20)
East, in the Town of Ledgeview, Brown County,
Wisconsin, more fully described as follows:
Commencing at the West 1/4 corner, Section 35,
T23N, R20E; thence N01 36' 23" West, 1763.33 feet along
the West line of said Section 35, to the South right-of-
way of Heritage Road, also known as C.T.H. "X"'; thence
N89 02'44" East, 82.54 feet along said right-of-way to
the point of beginning; thence N89 02'44" East 53.61
feet along said right-of-way; thence 167.98 feet along
said right-of-way, being the arc of a 1095.92 foot
radius curve to the right, whose long chord bears S86
33'48" East, 167.82 feet; thence S1 36' 23" East,
539.93 feet along the East line of Lot 1, Volume 30
Certified Survey Maps, Page 71, Brown County Records,
to the North right-of-way of Swan Road; thence S88 33'
16" West, 220.77 feet along said right-of-way; thence N
1 36' 23" West, 554.67 feet along the East line of Lot
1, Volume 34 Certified Survey Maps, Page 125, Brown
County Records, to the point of beginning.
Tax Parcel No. D-50-1 and D-84-1
Arcadian Lane/Heritage Road
De Pere, WI 54115
PROPERTY CO-TENANCY
OWNERSHIP AGREEMENT
(Children's World - DePere, WI)
THIS CO-TENANCY AGREEMENT,
Made and entered into as of the 24th day of March, 2000, by and
between George M. Kunitake and Kay H. Kunitake, husband and wife
as joint tenants, and Steven T. Kunitake, a married man as his
sole and separate property, all as joint tenants (hereinafter
called "Kunitake") and AEI Income & Growth Fund XXII Limited
Partnership (hereinafter called "Fund XXII") (Kunitake, Fund XXII
(and any other Owner in Fee where the context so indicates) being
hereinafter sometimes collectively called "Co-Tenants" and
referred to in the neuter gender).
WITNESSETH:
WHEREAS, Fund XXII presently owns an undivided 66.0573% interest
in and to, and Kunitake presently owns an undivided 16.7323%
interest in and to, and D & R Family Limited Partnership
presently owns an undivided 17.2104% interest in and to the land
situated in the City of DePere, County of Brown and State of WI,
(legally described upon Exhibit A attached hereto and hereby made
a part hereof) and in and to the improvements located thereon
(hereinafter called "Premises");
WHEREAS, The parties hereto wish to provide for the orderly
operation and management of the Premises and Kunitake's interest
by Fund XXII; the continued leasing of space within the Premises;
for the distribution of income from and the pro-rata sharing in
expenses of the Premises.
NOW THEREFORE, in consideration of the purchase by Kunitake of an
undivided interest in and to the Premises, for at least One
Dollar ($1.00) and other good and valuable consideration by the
parties hereto to one another in hand paid, the receipt and
sufficiency of which are hereby acknowledged, and of the mutual
covenants and agreements herein contained, it is hereby agreed by
and between the parties hereto, as follows:
1. The operation and management of the Premises shall be
delegated to Fund XXII, or its designated agent, successors or
assigns. Provided, however, if Fund XXII shall sell all of its
interest in the Premises, the duties and obligations of Fund XXII
respecting management of the Premises as set forth herein,
including but not limited to paragraphs 2, 3, and 4 hereof, shall
be exercised by the holder or holders of a majority undivided co-
tenancy interest in the Premises. Except as hereinafter expressly
provided to the contrary, each of the parties hereto agrees to be
bound by the decisions of Fund XXII with respect to all
administrative, operational and management matters of the
property comprising the Premises, including but not limited to
the management of the net lease agreement for the Premises. The
parties hereto hereby designate Fund XXII as their sole and
exclusive agent to deal with, and Fund XXII retains the sole
right to deal with, any property agent or tenant and to monitor,
execute and enforce the terms of leases of space within the
Premises, including but not limited to any amendments, consents
to assignment, sublet, releases or modifications to leases or
guarantees of lease or easements affecting the
Co-Tenant Initial: /s/ GMR by STK, /s/ KHK by STK /s/ STK
Co-Tenancy Agreement for Children's World, DePere, WI
Premises, on behalf of Kunitake. As long as Fund XXII owns an
interest in the Premises, only Fund XXII may obligate Kunitake
with respect to any expense for the Premises.
As further set forth in paragraph 2 hereof, Fund XXII agrees to
require any lessee of the Premises to name Kunitake as an insured
or additional insured in all insurance policies provided for, or
contemplated by, any lease on the Premises. Fund XXII shall use
its best efforts to obtain endorsements adding Co-Tenants to said
policies from lessee within 30 days of commencement of this
agreement. In any event, Fund XXII shall distribute any insurance
proceeds it may receive, to the extent consistent with any lease
on the Premises, to the Co-Tenants in proportion to their
respective ownership of the Premises.
2. Income and expenses shall be allocated among the Co-Tenants
in proportion to their respective share(s) of ownership. Shares
of net income shall be pro-rated for any partial calendar years
included within the term of this Agreement. Fund XXII may offset
against, pay to itself and deduct from any payment due to
Kunitake under this Agreement, and may pay to itself the amount
of Kunitake's share of any legitimate expenses of the Premises
which are not paid by Kunitake to Fund XXII or its assigns,
within ten (10) days after demand by Fund XXII. In the event
there is insufficient operating income from which to deduct
Kunitake's unpaid share of operating expenses, Fund XXII may
pursue any and all legal remedies for collection.
Operating Expenses shall include all normal operating expense,
including but not limited to: maintenance, utilities, supplies,
labor, management, advertising and promotional expenses, salaries
and wages of rental and management personnel, leasing commissions
to third parties, a monthly accrual to pay insurance premiums,
real estate taxes, installments of special assessments and for
structural repairs and replacements, management fees, legal fees
and accounting fees, but excluding all operating expenses paid by
Tenant under terms of any lease agreement of the Premises.
Kunitake has no requirement to, but has, nonetheless elected to
retain, and agrees to annually reimburse, Fund XXII in the amount
of $600 for the expenses, direct and indirect, incurred by Fund
XXII in providing Kunitake with quarterly accounting and
distributions of Kunitake 's share of net income and for
tracking, reporting and assessing the calculation of Kunitake 's
share of operating expenses incurred from the Premises. This
invoice amount shall be pro-rated for partial years and Kunitake
authorizes Fund XXII to deduct such amount from Kunitake 's share
of revenue from the Premises. Kunitake may terminate this
agreement in this paragraph respecting accounting and
distributions at any time and attempt to collect its share of
rental income directly from the tenant; however, enforcement of
all other provisions of the lease remains the sole right of Fund
XXII pursuant to Section 1 hereof. Fund XXII may terminate its
obligation under this paragraph upon 30 days notice to Kunitake
prior to the end of each anniversary hereof, unless agreed in
writing to the contrary.
3. Full, accurate and complete books of account shall be kept
in accordance with generally accepted accounting principles at
Fund XXII's principal office, and each Co-Tenant shall have
access to such books and may inspect and copy any part thereof
during normal business hours. Within ninety (90) days after the
end of each calendar year during the term hereof, Fund XXII
Co-Tenant Initial: /s/ GMR by STK, /s/ KHK by STK /s/ STK
Co-Tenancy Agreement for Children's World, DePere, WI
shall prepare an accurate income statement for the ownership of
the Premises for said calendar year and shall furnish copies of
the same to all Co-Tenants. Quarterly, as its share, Kunitake
shall be entitled to receive 16.7323% of all items of income and
expense generated by the Premises. Upon receipt of said
accounting, if the payments received by each Co-Tenant pursuant
to this Paragraph 3 do not equal, in the aggregate, the amounts
which each are entitled to receive proportional to its share of
ownership with respect to said calendar year pursuant to
Paragraph 2 hereof, an appropriate adjustment shall be made so
that each Co-Tenant receives the amount to which it is entitled.
4. If Net Income from the Premises is less than $0.00 (i.e.,
the Premises operates at a loss), or if capital improvements,
repairs, and/or replacements, for which adequate reserves do not
exist, need to be made to the Premises, the Co-Tenants, upon
receipt of a written request therefor from Fund XXII, shall,
within fifteen (15) business days after receipt of notice, make
payment to Fund XXII sufficient to pay said net operating losses
and to provide necessary operating capital for the premises and
to pay for said capital improvements, repairs and/or
replacements, all in proportion to their undivided interests in
and to the Premises.
5. Co-Tenants may, at any time, sell, finance, or otherwise
create a lien upon their interest in the Premises but only upon
their interest and not upon any part of the interest held, or
owned, by any other Co-Tenant. All Co-Tenants reserve the right
to escrow proceeds from a sale of their interests in the Premises
to obtain tax deferral by the purchase of replacement property.
6. If any Co-Tenant shall be in default with respect to any of
its obligations hereunder, and if said default is not corrected
within thirty (30) days after receipt by said defaulting Co-
Tenant of written notice of said default, or within a reasonable
period if said default does not consist solely of a failure to
pay money, the remaining Co-Tenant(s) may resort to any available
remedy to cure said default at law, in equity, or by statute.
7. This property management agreement shall continue in full
force and effect and shall bind and inure to the benefit of the
Co-Tenant and their respective heirs, executors, administrators,
personal representatives, successors and permitted assigns until
July 14, 2029 or upon the sale of the entire Premises in
accordance with the terms hereof and proper disbursement of the
proceeds thereof, whichever shall first occur. Unless
specifically identified as a personal contract right or
obligation herein, this agreement shall run with any interest in
the Property and with the title thereto. Once any person, party
or entity has ceased to have an interest in fee in any portion of
the Entire Property, it shall not be bound by, subject to or
benefit from the terms hereof; but its heirs, executors,
administrators, personal representatives, successors or assigns,
as the case may be, shall be substituted for it hereunder.
8. Any notice or election required or permitted to be given or
served by any party hereto to, or upon any other, shall be deemed
given or served in accordance with the provisions of this
Agreement, if said notice or elections addressed as follows;
Co-Tenant Initial: /s/ GMR by STK, /s/ KHK by STK /s/ STK
Co-Tenancy Agreement for Children's World, DePere, WI
If to Fund XXII:
AEI Income & Growth Fund XXII Limited Partnership
1300 Minnesota World Trade Center
30 E. Seventh Street
St. Paul, Minnesota 55101
If to Kunitake:
George M. and Kay H. Kunitake
Steven T. Kunitake
153 Exeter
San Carlos, CA 94070
If to D & R :
Robert DeKlotz, Partner
D & R Family Limited Partnership
1760 E. North Hills Drive
LaHabra, CA 90631
Each mailed notice or election shall be deemed to have been given
to, or served upon, the party to which addressed on the date the
same is deposited in the United States certified mail, return
receipt requested, postage prepaid, or given to a nationally
recognized courier service guaranteeing overnight delivery as
properly addressed in the manner above provided. Any party hereto
may change its address for the service of notice hereunder by
delivering written notice of said change to the other parties
hereunder, in the manner above specified, at least ten (10) days
prior to the effective date of said change.
9. This Agreement shall not create any partnership or joint
venture among or between the Co-Tenants or any of them, and the
only relationship among and between the Co-Tenants hereunder
shall be that of owners of the premises as tenants in common
subject to the terms hereof.
10. The unenforceability or invalidity of any provision or
provisions of this Agreement as to any person or circumstances
shall not render that provision, nor any other provision hereof,
unenforceable or invalid as to any other person or circumstances,
and all provisions hereof, in all other respects, shall remain
valid and enforceable.
11. In the event any litigation arises between the parties
hereto relating to this Agreement, or any of the provisions
hereof, the party prevailing in such action shall be entitled to
receive from the losing party, in addition to all other relief,
remedies and damages to which it is otherwise entitled, all
reasonable costs and expenses, including reasonable attorneys'
fees, incurred by the prevailing party in connection with said
litigation.
Co-Tenant Initial: /s/ GMR by STK, /s/ KHK by STK /s/ STK
Co-Tenancy Agreement for Children's World, DePere, WI
IN WITNESS WHEREOF, The parties hereto have caused this Agreement
to be executed and delivered, as of the day and year first above
written.
Kunitake: George M. Kunitake and Kay H. Kunitake, husband
and wife as joint tenants, and Steven T.
Kunitake, a married man as his sole and
separate property, all as joint tenants
By: /s/ George M Kunitake by Steven T Kunitake his atty
in fact
George M. Kunitake
By: /s/ Kay H Kunitake by Steven T Kunitake her atty in
fact
Kay H. Kunitake
By:/s/ Steven T Kunitake
Steven T. Kunitake
WITNESS:
(as to all signers)
/s/ Mary Kunitake
Mary Kunitake
(Print Name)
State of )
) ss.
County of )
I, a Notary Public in and for the state and county of aforesaid,
hereby certify there appeared before me this day of
2000, George M. Kunitake, who executed the
foregoing instrument in said capacity.
Notary Public
Co-Tenant Initial: /s/ GMR by STK, /s/ KHK by STK /s/ STK
Co-Tenancy Agreement for Children's World, DePere, WI
State of )
) ss.
County of )
I, a Notary Public in and for the state and county of aforesaid,
hereby certify there appeared before me this day of
2000, Kay H. Kunitake, who executed the
foregoing instrument in said capacity.
Notary Public
State of )
) ss.
County of )
I, a Notary Public in and for the state and county of aforesaid,
hereby certify there appeared before me this 15th day of March,
2000, Steven T. Kunitake, who executed the foregoing instrument
in said capacity.
/s/ Dawn Burton
Notary Public
[notary seal]
Co-Tenant Initial: /s/ GMR by STK, /s/ KHK by STK /s/ STK
Co-Tenancy Agreement for Children's World, DePere, WI
Fund XXII: AEI Income & Growth Fund XXII Limited Partnership
By: AEI Fund Management XXI, Inc., its corporate general
partner
By:/s/ Robert P Johnson
Robert P. Johnson, President
WITNESS:
/s/ Jill Rayburn
Jill Rayburn
(Print Name)
State of Minnesota )
) ss.
County of Ramsey )
I, a Notary Public in and for the state and county of aforesaid,
hereby certify there appeared before me this 24th day of March,
2000, Robert P. Johnson, President of AEI Fund Management XXI
Inc., corporate general partner of AEI Income & Growth Fund XXII
Limited Partnership, who executed the foregoing instrument in
said capacity and on behalf of the corporation in its capacity as
corporate general partner, on behalf of said limited partnership.
/s/ Barbara J Kochevar
Notary Public
[notary seal]
Co-Tenant Initial: /s/ GMR by STK, /s/ KHK by STK /s/ STK
Co-Tenancy Agreement for Children's World, DePere, WI
EXHIBIT "A"
LEGAL DESCRIPTION
All of Lot One (1) of Volumnet 34 Certified Survey
Maps, Page 125, Brown County Records, and is located in
part of Government Lots 1 and 2, Section Thirty-five
(35) and part of Government Lot 1 and part of the
Southeast One-quarter of the Northeast, One-quarter (SE
1/4 - NE 1/4), Section Thirty-four (34), all being in
Township Twenty-three (23) North, Range Twenty (20)
East, in the Town of Ledgeview, Brown County,
Wisconsin.
and
Part of Lot One (1) of Volume 30 Certified Survey
Maps, Page 71, Brown County Records, being part of
Government Lots 1 and 2, Section Thirty-five (35),
Township Twenty-three (23) North, Range Twenty (20)
East, in the Town of Ledgeview, Brown County,
Wisconsin, more fully described as follows:
Commencing at the West 1/4 corner, Section 35,
T23N, R20E; thence N01 36' 23" West, 1763.33 feet along
the West line of said Section 35, to the South right-of-
way of Heritage Road, also known as C.T.H. "X"'; thence
N89 02'44" East, 82.54 feet along said right-of-way to
the point of beginning; thence N89 02'44" East 53.61
feet along said right-of-way; thence 167.98 feet along
said right-of-way, being the arc of a 1095.92 foot
radius curve to the right, whose long chord bears S86
33'48" East, 167.82 feet; thence S1 36' 23" East,
539.93 feet along the East line of Lot 1, Volume 30
Certified Survey Maps, Page 71, Brown County Records,
to the North right-of-way of Swan Road; thence S88 33'
16" West, 220.77 feet along said right-of-way; thence N
1 36' 23" West, 554.67 feet along the East line of Lot
1, Volume 34 Certified Survey Maps, Page 125, Brown
County Records, to the point of beginning.
Tax Parcel No. D-50-1 and D-84-1
Arcadian Lane/Heritage Road
De Pere, WI 54115
PURCHASE AGREEMENT
Children's World - DePere, WI
This AGREEMENT, entered into effective as of the 27th of March,
2000.
l. PARTIES. Seller is AEI Income & Growth Fund XXII Limited
Partnership which owns an undivided 66.0573% interest in the fee
title to that certain real property legally described in the
attached Exhibit "A" (the "Entire Property") Buyer is Carl
R.Whittington, Trustee of the Carl R. Whittington Trust dated
October 16, 1996 ("Buyer"). Seller wishes to sell and Buyer
wishes to buy a portion as Tenant in Common of Seller's interest
in the Entire Property.
2. PROPERTY. The Property to be sold to Buyer in this transaction
consists of an undivided 14.8036 percentage interest
(hereinafter, simply the "Property") as Tenant in Common in the
Entire Property.
3. PURCHASE PRICE. The purchase price for this percentage
interest in the Entire Property is $224,500, all cash.
4. TERMS. The purchase price for the Property will be paid by
Buyer as follows:
(a) When this agreement is executed, Buyer will pay $5,000
to Seller (which shall be deposited into escrow according to
the terms hereof) (the "First Payment"). The First Payment
will be credited against the purchase price when and if
escrow closes and the sale is completed.
(b) Buyer will deposit the balance of the purchase price,
$219,500 (the "Second Payment") into escrow in sufficient
time to allow escrow to close on the closing date.
5. CLOSING DATE. Escrow is anticipated to close on or before
March 31, 2000.
6. DUE DILIGENCE. Buyer will have until the expiration of the
fifth business day (The "Review Period") after delivery of each
of following items, to be supplied by Seller, to conduct all of
its inspections and due diligence and satisfy itself regarding
each item, the Property, and this transaction. Buyer agrees to
indemnify and hold Seller harmless for any loss or damage to the
Entire Property or persons caused by Buyer or its agents arising
out of such physical inspections of the Entire Property.
(a) The original and one copy of a title insurance
commitment for an Owner's Title insurance policy (see
paragraph 8 below).
(b) Copies of a Certificate of Occupancy or other such
document certifying completion and granting permission to
permanently occupy the improvements on the Entire Property
as are in Seller's possession.
(c) Copies of an "as built" survey of the Entire Property
done concurrent with Seller's acquisition of the Property.
Buyer Initial: /s/ CRW
Purchase Agreement for Children's World, DePere, WI
(d) Lease (as further set forth in paragraph 11(a) below) of
the Entire Property showing occupancy date, lease expiration
date, rent, and Guarantys, if any, accompanied by such
tenant financial statements as may have been provided most
recently to Seller by the Tenant and/or Guarantors.
It is a contingency upon Seller's obligations hereunder that
two (2) copies of Co-Tenancy Agreement in the form attached
hereto duly executed by Buyer and Seller and dated on escrow
closing date be delivered to the Seller on the closing date.
Buyer may cancel this agreement for ANY REASON in its sole
discretion by delivering a cancellation notice, return receipt
requested, to Seller and escrow holder before the expiration of
the Review Period. Such notice shall be deemed effective only
upon receipt by Seller. If this Agreement is not cancelled as
set forth above, the First Payment shall be non-refundable unless
Seller shall default hereunder.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under the first paragraph of section 6 of this
agreement (which will survive), Buyer (after execution of such
documents reasonably requested by Seller to evidence the
termination hereof) shall be returned its First Payment, and
Buyer will have absolutely no rights, claims or interest of any
type in connection with the Property or this transaction,
regardless of any alleged conduct by Seller or anyone else.
Unless this Agreement is canceled by Buyer pursuant to the
terms hereof, if Buyer fails to make the Second Payment, Seller
shall be entitled to retain the First Payment and Buyer
irrevocably will be deemed to be in default under this Agreement.
Seller may, at its option, retain the First Payment and declare
this Agreement null and void, in which event Buyer will be deemed
to have canceled this Agreement and relinquish all rights in and
to the Property or Seller may exercise its rights under Section
14 hereof. If this Agreement is not canceled and the Second
Payment is made when required, all of Buyer's conditions and
contingencies will be deemed satisfied.
7. ESCROW. Escrow shall be opened by Seller and funds deposited
in escrow upon acceptance of this agreement by both parties. The
escrow holder will be a nationally-recognized escrow company
selected by Seller. A copy of this Agreement will be delivered to
the escrow holder and will serve as escrow instructions together
with the escrow holder's standard instructions and any additional
instructions required by the escrow holder to clarify its rights
and duties (and the parties agree to sign these additional
instructions). If there is any conflict between these other
instructions and this Agreement, this Agreement will control.
8. TITLE. Closing will be conditioned on the commitment of a
title company selected by Seller to issue an Owner's policy of
title insurance, dated as of the close of escrow, in an amount
equal to the purchase price, insuring that Buyer will own
insurable title to the Property subject only to: the title
company's standard exceptions; current real property taxes and
assessments; survey exceptions; the rights of parties in
possession pursuant to the lease defined in paragraph 11
Buyer Initial: /s/ CRW
Purchase Agreement for Children's World, DePere, WI
below; all matters of public record as shown in the title
commitment; and other items disclosed to Buyer during the Review
Period.
Buyer shall be allowed five (5) days after receipt of said
commitment for examination and the making of any objections to
marketability thereto, said objections to be made in writing or
deemed waived. If any objections are so made, the Seller shall
be allowed eighty (80) days to make such title marketable or in
the alternative to obtain a commitment for insurable title
insuring over Buyer's objections. If Seller shall decide to make
no efforts to make title marketable, or is unable to make title
marketable or obtain insurable title, (after execution by Buyer
of such documents reasonably requested by Seller to evidence the
termination hereof) Buyer's First Payment shall be returned and
this Agreement shall be null and void and of no further force and
effect.
Pending correction of title, the payments hereunder required
shall be postponed, but upon correction of title and within ten
(10) days after written notice of correction to the Buyer, the
parties shall perform this Agreement according to its terms.
9. CLOSING COSTS. Seller will pay one-half of escrow fees, the
cost of the title commitment and any brokerage commissions
payable. The Buyer will pay the cost of issuing a Standard
Owners Title Insurance Policy in the full amount of the purchase
price, if Buyer shall decide to purchase the same. Buyer will
pay all recording fees, one-half of the escrow fees, and the cost
of an update to the Survey in Sellers possession (if an update is
required by Buyer.) Each party will pay its own attorney's fees
and costs to document and close this transaction.
10. REAL ESTATE TAXES, SPECIAL ASSESSMENTS AND PRORATIONS.
(a) Because the Entire Property (of which the Property is a
part) is subject to a triple net lease (as further set forth
in paragraph 11(a)(i), the parties acknowledge that there
shall be no need for a real estate tax proration. However,
Seller represents that to the best of its knowledge, all
real estate taxes and installments of special assessments
due and payable in all years prior to the year of Closing
have been paid in full. Unpaid real estate taxes and unpaid
levied and pending special assessments for the year of
Closing shall be the responsibility of Buyer and Seller in
proportion to their respective Tenant in Common interests,
pro-rated, however, to the date of closing for the period
prior to closing, which shall be the responsibility of
Seller if Tenant shall not pay the same. Seller and Buyer
shall likewise pay all taxes due and payable in the year
after Closing and any unpaid installments of special
assessments payable therewith and thereafter, if such unpaid
levied and pending special assessments and real estate taxes
are not paid by any tenant of the Entire Property.
(b) All income and all operating expenses from the Entire
Property shall be prorated between the parties and adjusted by
them as of the date of Closing. Seller shall be entitled to all
income earned and shall be responsible for all expenses incurred
prior to the date of Closing, and Buyer shall be entitled to its
proportionate share of all income earned and shall be responsible
for its proportionate share of all operating expenses of the
Entire Property incurred on and after the date of closing.
Buyer Initial: /s/ CRW
Purchase Agreement for Children's World, DePere, WI
11. SELLER'S REPRESENTATION AND AGREEMENTS.
(a) Seller represents and warrants as of this date that:
(i) Except for the Net Lease Agreement in existence between
AEI Income & Growth Fund XXII Limited Partnership and
ARAMARK Educational Resources, Inc., f/k/a Children's World
Learning Centers, Inc., dated July 14, 1999, Seller is not
aware of any leases of the Property.
(ii) It is not aware of any pending litigation or
condemnation proceedings against the Property or Seller's
interest in the Property.
(iii) Except as previously disclosed to Buyer and as set
forth in paragraph (b) below, Seller is not aware of any
contracts Seller has executed that would be binding on Buyer
after the closing date.
(b) Provided that Buyer performs its obligations when
required, Seller agrees that it will not enter into any new
contracts that would materially affect the Property and be
binding on Buyer after the Closing Date without Buyer's
prior consent, which will not be unreasonably withheld.
However, Buyer acknowledges that Seller retains the right
both prior to and after the Closing Date to freely transfer
all or a portion of Seller's remaining undivided interest in
the Entire Property, provided such sale shall not encumber
the Property being purchased by Buyer in violation of the
terms hereof or the contemplated Co-Tenancy Agreement.
12. DISCLOSURES.
(a) To the best of Seller's knowledge: there are now, and
at the Closing there will be, no material, physical or
mechanical defects of the Property, including, without
limitation, the plumbing, heating, air conditioning,
ventilating, electrical systems, and all such items are in
good operating condition and repair and in compliance with
all applicable governmental , zoning and land use laws,
ordinances, regulations and requirements.
(b) To the best of Seller's knowledge: the use and
operation of the Property now is, and at the time of Closing
will be, in full compliance with applicable building codes,
safety, fire, zoning, and land use laws, and other
applicable local, state and federal laws, ordinances,
regulations and requirements.
(c) Seller knows of no facts nor has Seller failed to
disclose to Buyer any fact known to Seller which would
prevent Buyer from using and operating the Property after
the Closing in the manner in which the Property has been
used and operated prior to the date of this Agreement.
(c) To the best of Seller's knowledge: the Property is not, and
as of the Closing will not be, in violation of any federal, state
or local law, ordinance or regulations relating to industrial
hygiene or to the environmental conditions on, under, or about
the Property
Buyer Initial: /s/ CRW
Purchase Agreement for Children's World, DePere, WI
including, but not limited to, soil and groundwater
conditions. To the best of Seller's knowledge: there is no
proceeding or inquiry by any governmental authority with
respect to the presence of Hazardous Materials on the
Property or the migration of Hazardous Materials from or to
other property. Buyer agrees that Seller will have no
liability of any type to Buyer or Buyer's successors,
assigns, or affiliates in connection with any Hazardous
Materials on or in connection with the Property either
before or after the Closing Date, except as provided under
applicable state or federal laws or regulations.
(e) BUYER AGREES THAT IT SHALL BE PURCHASING THE PROPERTY
IN ITS THEN PRESENT CONDITION, AS IS, WHERE IS, AND SELLER
HAS NO OBLIGATIONS TO CONSTRUCT OR REPAIR ANY IMPROVEMENTS
THEREON OR TO PERFORM ANY OTHER ACT REGARDING THE PROPERTY,
EXCEPT AS EXPRESSLY PROVIDED HEREIN.
(F) BUYER ACKNOWLEDGES THAT, HAVING BEEN GIVEN THE OPPORTUNITY
TO INSPECT THE PROPERTY AND SUCH FINANCIAL INFORMATION ON THE
LESSEE AND GUARANTORS OF THE LEASE AS BUYER OR ITS ADVISORS SHALL
REQUEST, BUYER IS RELYING SOLELY ON ITS OWN INVESTIGATION OF THE
PROPERTY AND NOT ON ANY INFORMATION PROVIDED BY SELLER OR TO BE
PROVIDED EXCEPT AS SET FORTH HEREIN. BUYER FURTHER ACKNOWLEDGES
THAT THE INFORMATION PROVIDED AND TO BE PROVIDED BY SELLER WITH
RESPECT TO THE PROPERTY AND TO THE LESSEE AND GUARANTORS OF LEASE
WAS OBTAINED FROM A VARIETY OF SOURCES AND SELLER NEITHER (A) HAS
MADE INDEPENDENT INVESTIGATION OR VERIFICATION OF SUCH
INFORMATION, OR (B) MAKES ANY REPRESENTATIONS AS TO THE ACCURACY
OR COMPLETENESS OF SUCH INFORMATION. THE SALE OF THE PROPERTY AS
PROVIDED FOR HEREIN IS MADE ON AN "AS IS" BASIS, AND BUYER
EXPRESSLY ACKNOWLEDGES THAT, IN CONSIDERATION OF THE AGREEMENTS
OF SELLER HEREIN, EXCEPT AS OTHERWISE SPECIFIED HEREIN, SELLER
MAKES NO WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, OR
ARISING BY OPERATION OF LAW, INCLUDING, BUT NOT LIMITED TO, ANY
WARRANTY OR CONDITION, HABITABILITY, TENANTABILITY, SUITABILITY
FOR COMMERCIAL PURPOSES, MERCHANTABILITY, OR FITNESS FOR A
PARTICULAR PURPOSE, IN RESPECT OF THE PROPERTY.
The provisions (d) - (f) above shall survive closing.
13. CLOSING.
(a) Before the closing date, Seller will deposit into
escrow an executed limited warranty deed conveying insurable
title of the Property to Buyer, subject to the encumbrances
contained in paragraph 8 above.
(b) On or before the closing date, Buyer will deposit into
escrow: the balance of the purchase price when required
under Section 4; any additional funds required of Buyer,
(pursuant to this agreement or any other agreement executed
by Buyer) to close escrow. Both parties will sign and
deliver to the escrow holder any other documents reasonably
required by the escrow holder to close escrow.
Buyer Initial: /s/ CRW
Purchase Agreement for Children's World, DePere, WI
(c) On the closing date, if escrow is in a position to
close, the escrow holder will: record the deed in the
official records of the county where the Property is
located; cause the title company to commit to issue the
title policy; immediately deliver to Seller the portion of
the purchase price deposited into escrow by cashier's check
or wire transfer (less debits and prorations, if any);
deliver to Seller and Buyer a signed counterpart of the
escrow holder's certified closing statement and take all
other actions necessary to close escrow.
14. DEFAULTS. If Buyer defaults, Buyer will forfeit all rights
and claims and Seller will be relieved of all obligations and
will be entitled to retain all monies heretofore paid by the
Buyer. In addition, Seller shall retain all remedies available
to Seller at law or in equity.
If Seller shall default, Buyer irrevocably waives any rights
to file a lis pendens, a specific performance action or any other
claim, action or proceeding of any type in connection with the
Property or this or any other transaction involving the Property,
and will not do anything to affect title to the Property or
hinder, delay or prevent any other sale, lease or other
transaction involving the Property (any and all of which will be
null and void), unless: it has paid the First Payment, deposited
the balance of the Second Payment for the purchase price into
escrow, performed all of its other obligations and satisfied all
conditions under this Agreement, and unconditionally notified
Seller that it stands ready to tender full performance, purchase
the Property and close escrow as per this Agreement, regardless
of any alleged default or misconduct by Seller. Provided,
however, that in no event shall Seller be liable for any
punitive, consequential or speculative damages arising out of any
default by Seller hereunder.
15. BUYER'S REPRESENTATIONS AND WARRANTIES.
a. Buyer represents and warrants to Seller as follows:
(i) In addition to the acts and deeds recited herein and
contemplated to be performed, executed, and delivered by
Buyer, Buyer shall perform, execute and deliver or cause to
be performed, executed, and delivered at the Closing or
after the Closing, any and all further acts, deeds and
assurances as Seller or the Title Company may require and be
reasonable in order to consummate the transactions
contemplated herein.
(ii) Buyer has all requisite power and authority to
consummate the transaction contemplated by this Agreement
and has by proper proceedings duly authorized the execution
and delivery of this Agreement and the consummation of the
transaction contemplated hereby.
(iii) To Buyer's knowledge, neither the execution and
delivery of this Agreement nor the consummation of the
transaction contemplated hereby will violate or be in
conflict with (a) any applicable provisions of law, (b) any
order of any court or other agency of government having
jurisdiction hereof, or (c) any agreement or instrument to
which Buyer is a party or by which Buyer is bound.
Buyer Initial: /s/ CRW
Purchase Agreement for Children's World, DePere, WI
16. DAMAGES, DESTRUCTION AND EMINENT DOMAIN.
(a) If, prior to closing, the Property or any part thereof
is destroyed or further damaged by fire, the elements, or
any cause, due to events occurring subsequent to the date of
this Agreement to the extent that the cost of repair exceeds
$10,000.00, this Agreement shall become null and void, at
Buyer's option exercised, if at all, by written notice to
Seller within ten (10) days after Buyer has received written
notice from Seller of said destruction or damage. Seller,
however, shall have the right to adjust or settle any
insured loss until (i) all contingencies set forth in
Paragraph 6 hereof have been satisfied, or waived; and (ii)
any ten-day period provided for above in this Subparagraph
16a for Buyer to elect to terminate this Agreement has
expired or Buyer has, by written notice to Seller, waived
Buyer's right to terminate this Agreement. If Buyer elects
to proceed and to consummate the purchase despite said
damage or destruction, there shall be no reduction in or
abatement of the purchase price, and Seller shall assign to
Buyer the Seller's right, title, and interest in and to all
insurance proceeds (pro-rata in relation to the Entire
Property) resulting from said damage or destruction to the
extent that the same are payable with respect to damage to
the Property, subject to rights of any Tenant of the Entire
Property.
If the cost of repair is less than $10,000.00, Buyer shall
be obligated to otherwise perform hereinunder with no
adjustment to the Purchase Price, reduction or abatement,
and Seller shall assign Seller's right, title and interest
in and to all insurance proceeds pro-rata in relation to the
Entire Property, subject to rights of any Tenant of the
Entire Property.
(b) If, prior to closing, the Property, or any part
thereof, is taken by eminent domain, this Agreement shall
become null and void, at Buyer's option. If Buyer elects to
proceed and to consummate the purchase despite said taking,
there shall be no reduction in, or abatement of, the
purchase price, and Seller shall assign to Buyer the
Seller's right, title, and interest in and to any award
made, or to be made, in the condemnation proceeding pro-rata
in relation to the Entire Property, subject to rights of any
Tenant of the Entire Property.
In the event that this Agreement is terminated by Buyer as
provided above in Subparagraph 16a or 16b, the First Payment
shall be immediately returned to Buyer (after execution by Buyer
of such documents reasonably requested by Seller to evidence the
termination hereof).
17. BUYER'S 1031 TAX FREE EXCHANGE.
While Seller acknowledges that Buyer is purchasing the
Property as "replacement property" to accomplish a tax free
exchange, Buyer acknowledges that Seller has made no
representations, warranties, or agreements to Buyer or Buyer's
agents that the transaction contemplated by the Agreement will
qualify for such tax treatment, nor has there been any reliance
thereon by Buyer respecting the legal or tax implications of the
transactions
Buyer Initial: /s/ CRW
Purchase Agreement for Children's World, DePere, WI
contemplated hereby. Buyer further represents that it has sought
and obtained such third party advice and counsel as it deems
necessary in regards to the tax implications of this transaction.
Buyer wishes to novate/assign the ownership rights and
interest of this Purchase Agreement to G.T. Transfer and Exchange
Corporation, which will act as Accommodator to perfect the 1031
exchange by preparing an agreement of exchange of Real Property
whereby G.T. Transfer and Exchange Corporation will be an
independent third party purchasing the ownership interest in
subject property from Seller and selling the ownership interest
in subject property to Buyer under the same terms and conditions
as documented in this Purchase Agreement. Seller consents to
such assignments. Buyer asks the Seller, and Seller agrees to
cooperate in the perfection of such an exchange if at no
additional cost or expense to Seller or delay in time. Buyer
hereby indemnifies and holds Seller harmless from any claims
and/or actions resulting from said exchange. Pursuant to the
direction of G.T. Transfer and Exchange Corporation, Seller will
deed the Property directly to Buyer.
18. CANCELLATION
If any party elects to cancel this Contract because of any
breach by another party or because escrow fails to close by
the agreed date, the party electing to cancel shall deliver
to escrow agent a notice containing the address of the party
in breach and stating that this Contract shall be cancelled
unless the breach is cured within 10 days following the
delivery of the notice to the escrow agent. Within three
days after receipt of such notice, the escrow agent shall
send it by United States Mail to the party in breach at the
address contained in the Notice and no further notice shall
be required. If the breach is not cured within the 10 days
following the delivery of the notice to the escrow agent,
this Contract shall be cancelled.
19. MISCELLANEOUS.
(a) This Agreement may be amended only by written agreement
signed by both Seller and Buyer, and all waivers must be in
writing and signed by the waiving party. Time is of the
essence. This Agreement will not be construed for or
against a party whether or not that party has drafted this
Agreement. If there is any action or proceeding between the
parties relating to this Agreement the prevailing party will
be entitled to recover attorney's fees and costs. This is
an integrated agreement containing all agreements of the
parties about the Property and the other matters described,
and it supersedes any other agreements or understandings.
Exhibits attached to this Agreement are incorporated into
this Agreement.
(b) If this escrow has not closed by April 30, 2000,
through no fault of Seller, Seller may either, at its
election, extend the closing date or exercise any remedy
available to it by law, including terminating this
Agreement.
(c) Funds to be deposited or paid by Buyer must be good and
clear funds in the form of cash, cashier's checks or wire
transfers.
Buyer Initial: /s/ CRW
Purchase Agreement for Children's World, DePere, WI
(d) All notices from either of the parties hereto to the
other shall be in writing and shall be considered to have
been duly given or served if sent by first class certified
mail, return receipt requested, postage prepaid, or by a
nationally recognized courier service guaranteeing overnight
delivery to the party at his or its address set forth below,
or to such other address as such party may hereafter
designate by written notice to the other party.
If to Seller:
Attention: Robert P. Johnson
AEI Income & Growth Fund XXII Limited Partnership
1300 Minnesota World Trade Center
30 E. 7th Street
St. Paul, MN 55101
If to Buyer:
Carl R. Whittington, Trustee
1440 Elm Grove Avenue
Akron, OH 44312
When accepted, this offer will be a binding agreement for
valid and sufficient consideration which will bind and benefit
Buyer, Seller and their respective successors and assigns. Buyer
is submitting this offer by signing a copy of this offer and
delivering it to Seller. Seller has five (5) business days from
receipt within which to accept this offer.
REST OF PAGE INTENTIONALLY LEFT BLANK
Buyer Initial: /s/ CRW
Purchase Agreement for Children's World, DePere, WI
IN WITNESS WHEREOF, the Seller and Buyer have executed this
Agreement effective as of the day and year above first written.
BUYER: Carl R. Whittington, Trustee of the Carl R.
Whittington Trust dated October 16, 1996
By: /s/ Carl R Whittington, Trustee
Carl R. Whittington, Trustee
WITNESS:
/s/ Marilyn Dodson
Marilyn Dodson
(Print Name)
SELLER: AEI Income & Growth Fund XXII Limited Partnership, a
Minnesota limited partnership
By: AEI Fund Management XXI, Inc., its corporate
general partner
By:/s/ Robert P Johnson
Robert P. Johnson, President
WITNESS:
/s/ Jill Rayburn
Jill Rayburn
(Print Name)
Buyer Initial: /s/ CRW
Purchase Agreement for Children's World, DePere, WI
EXHIBIT "A"
LEGAL DESCRIPTION
All of Lot One (1) of Volumnet 34 Certified Survey
Maps, Page 125, Brown County Records, and is located in
part of Government Lots 1 and 2, Section Thirty-five
(35) and part of Government Lot 1 and part of the
Southeast One-quarter of the Northeast, One-quarter (SE
1/4 - NE 1/4), Section Thirty-four (34), all being in
Township Twenty-three (23) North, Range Twenty (20)
East, in the Town of Ledgeview, Brown County,
Wisconsin.
and
Part of Lot One (1) of Volume 30 Certified Survey
Maps, Page 71, Brown County Records, being part of
Government Lots 1 and 2, Section Thirty-five (35),
Township Twenty-three (23) North, Range Twenty (20)
East, in the Town of Ledgeview, Brown County,
Wisconsin, more fully described as follows:
Commencing at the West 1/4 corner, Section 35,
T23N, R20E; thence N01 36' 23" West, 1763.33 feet along
the West line of said Section 35, to the South right-of-
way of Heritage Road, also known as C.T.H. "X"'; thence
N89 02'44" East, 82.54 feet along said right-of-way to
the point of beginning; thence N89 02'44" East 53.61
feet along said right-of-way; thence 167.98 feet along
said right-of-way, being the arc of a 1095.92 foot
radius curve to the right, whose long chord bears S86
33'48" East, 167.82 feet; thence S1 36' 23" East,
539.93 feet along the East line of Lot 1, Volume 30
Certified Survey Maps, Page 71, Brown County Records,
to the North right-of-way of Swan Road; thence S88 33'
16" West, 220.77 feet along said right-of-way; thence N
1 36' 23" West, 554.67 feet along the East line of Lot
1, Volume 34 Certified Survey Maps, Page 125, Brown
County Records, to the point of beginning.
Tax Parcel No. D-50-1 and D-84-1
Arcadian Lane/Heritage Road
De Pere, WI 54115
PURCHASE AGREEMENT
Marie Callender's - Henderson, NV
This AGREEMENT, entered into effective as of the 29th of March,
2000.
l. PARTIES. Seller is AEI Income & Growth Fund XXII Limited
Partnership which presently owns an undivided 26.8390% interest
in the fee title to that certain real property legally described
in the attached Exhibit "A" (the "Entire Property"). Buyer is
Carl R. Whittington, Trustee of the Carl R. Whittington Trust
dated October 16, 1996 ("Buyer"). Seller wishes to sell and Buyer
wishes to buy a portion as Tenant in Common of Seller's interest
in the Entire Property.
2. PROPERTY. The Property to be sold to Buyer in this transaction
consists of an undivided 10.4257 percentage interest
(hereinafter, simply the "Property") as Tenant in Common in the
Entire Property.
3. PURCHASE PRICE The purchase price for this percentage
interest in the Entire Property is $224,500, all cash.
4. TERMS. The purchase price for the Property will be paid by
Buyer as follows:
(a) When this agreement is executed, Buyer will pay $5,000
to Seller (which shall be deposited into escrow according to
the terms hereof) (the "First Payment"). The First Payment
will be credited against the purchase price when and if
escrow closes and the sale is completed.
(b) Buyer will deposit the balance of the purchase price,
$219,500 (the "Second Payment") into escrow in sufficient
time to allow escrow to close on the closing date.
5. CLOSING DATE. Escrow is anticipated to close on or before
March 31, 2000.
6. DUE DILIGENCE. Buyer will have until the expiration of the
tenth business day (The "Review Period") after delivery of each
of following items, to be supplied by Sellers, to conduct all of
its inspections and due diligence and satisfy itself regarding
each item, the Property, and this transaction. Buyer agrees to
indemnify and hold Sellers harmless for any loss or damage to the
Entire Property or persons caused by Buyer or its agents arising
out of such physical inspections of the Entire Property.
(a) The original and one copy of a title insurance
commitment for an Owner's Title insurance policy (see
paragraph 8 below).
(b) A copy of a Certificate of Occupancy or other such
document certifying completion and granting permission to
permanently occupy the improvements on the Entire Property
as are in Seller's possession.
(c) A copy of an "as built" survey of the Entire Property
done concurrent with Seller's acquisition of the Property.
Buyer Initial: /s/ CRW
Purchase Agreement for Marie Callender's-Henderson, NV
(d) Lease (as further set forth in paragraph 11(a) below) of
the Entire Property showing occupancy date, lease expiration
date, rent, and Guarantys, if any, accompanied by such
tenant financial statements as may have been provided most
recently to Seller by the Tenant and/or Guarantors.
It is a contingency upon Seller's obligations hereunder that two
(2) copies of Co-Tenancy Agreement in the form attached hereto
duly executed by Buyer and AEI Real Estate Fund XIX Limited
Partnership and dated on escrow closing date be delivered to the
Seller on the closing date.
Buyer may cancel this agreement for ANY REASON in its sole
discretion by delivering a cancellation notice, return receipt
requested, to Seller and escrow holder before the expiration of
the Review Period. Such notice shall be deemed effective only
upon receipt by Seller. If this Agreement is not cancelled as
set forth above, the First Payment shall be non-refundable unless
Seller shall default hereunder.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under the first paragraph of section 6 of this
agreement (which will survive), Buyer (after execution of such
documents reasonably requested by Seller to evidence the
termination hereof) shall be returned its First Payment, and
Buyer will have absolutely no rights, claims or interest of any
type in connection with the Property or this transaction,
regardless of any alleged conduct by Sellers or anyone else.
Unless this Agreement is canceled by Buyer pursuant to the
terms hereof, if Buyer fails to make the Second Payment, Seller
shall be entitled to retain the First Payment and Buyer
irrevocably will be deemed to be in default under this Agreement.
Seller may, at its option, retain the First Payment and declare
this Agreement null and void, in which event Buyer will be deemed
to have canceled this Agreement and relinquish all rights in and
to the Property or Sellers may exercise its rights under Section
14 hereof. If this Agreement is not canceled and the Second
Payment is made when required, all of Buyer's conditions and
contingencies will be deemed satisfied.
7. ESCROW. Escrow shall be opened by Seller and funds deposited
in escrow upon acceptance of this Agreement by both parties. The
escrow holder will be a nationally-recognized escrow company
selected by Seller. A copy of this Agreement will be delivered to
the escrow holder and will serve as escrow instructions together
with the escrow holder's standard instructions and any additional
instructions required by the escrow holder to clarify its rights
and duties (and the parties agree to sign these additional
instructions). If there is any conflict between these other
instructions and this Agreement, this Agreement will control.
8. TITLE. Closing will be conditioned on the agreement of a
title company selected by Seller to issue an Owner's policy of
title insurance, dated as of the close of escrow, in an amount
equal to the purchase price, insuring that Buyer will own
insurable title to the Property subject only to: the title
company's standard exceptions; current real property taxes and
assessments; survey exceptions; the rights of parties in
possession pursuant to the lease defined in paragraph 11 below;
and other items of record as shown in the title commitment.
Buyer Initial: /s/ CRW
Purchase Agreement for Marie Callender's-Henderson, NV
Buyer shall be allowed five (5) days after receipt of said
commitment for examination and the making of any objections to
marketability thereto, said objections to be made in writing or
deemed waived. If any objections are so made, the Seller shall
be allowed eighty (80) days to make such title marketable or in
the alternative to obtain a commitment for insurable title
insuring over Buyer's objections. If Sellers shall decide to
make no efforts to make title marketable, or is unable to make
title marketable or obtain insurable title, (after execution by
Buyer of such documents reasonably requested by Seller to
evidence the termination hereof) Buyer's First Payment shall be
returned and this Agreement shall be null and void and of no
further force and effect. Seller has no obligation to spend any
funds or make any effort to satisfy Buyer's objections, if any.
Pending satisfaction of Buyer's objections, the payments
hereunder required shall be postponed, but upon satisfaction of
Buyer's objections and within ten (10) days after written notice
of satisfaction of Buyer's objections to the Buyer, the parties
shall perform this Agreement according to its terms.
9. CLOSING COSTS. Seller will pay one-half of escrow fees, the
cost of the title commitment and any brokerage commissions
payable. The Buyer will pay the cost of issuing a Standard
Owners Title Insurance Policy in the full amount of the purchase
price, if Buyer shall decide to purchase the same. Buyer will
pay all recording fees, one-half of the escrow fees, and the cost
of an update to the Survey in Seller possession (if an update is
required by Buyer.) Each party will pay its own attorney's fees
and costs to document and close this transaction.
10. REAL ESTATE TAXES, SPECIAL ASSESSMENTS AND PRORATIONS.
(a) Because the Entire Property (of which the Property is a
part) is subject to a triple net lease (as further set forth
in paragraph 11(a)(i), the parties acknowledge that there
shall be no need for a real estate tax proration. However,
Seller represents that to the best of its knowledge, all
real estate taxes and installments of special assessments
due and payable in all years prior to the year of Closing
have been paid in full. Unpaid real estate taxes and unpaid
levied and pending special assessments existing on the date
of Closing shall be the responsibility of Buyer and Seller
in proportion to their respective Tenant in Common
interests, pro-rated, however, to the date of closing for
the period prior to closing, which shall be the
responsibility of Seller if Tenant shall not pay the same.
Seller and Buyer shall likewise pay all taxes due and
payable in the year after Closing and any unpaid
installments of special assessments payable therewith and
thereafter, if such unpaid levied and pending special
assessments and real estate taxes are not paid by any tenant
of the Entire Property.
(b) All income and all operating expenses from the Entire
Property shall be prorated between the parties and adjusted
by them as of the date of Closing. Seller shall be entitled
to all income earned and shall be responsible for all
expenses incurred prior to the date of Closing, and Buyer
shall be entitled to its proportionate share of all income
earned and shall be responsible for its proportionate share
of all operating expenses of the Entire Property incurred on
and after the date of closing.
Buyer Initial: /s/ CRW
Purchase Agreement for Marie Callender's-Henderson, NV
11. SELLER'S REPRESENTATION AND AGREEMENTS.
(a) Seller represents and warrants as of this date that:
(i) Except for the Lease Agreement in existence between AEI
Net Lease Income & Growth Fund XIX Limited Partnership, AEI
Income & Growth Fund XXII Limited Partnership (as
"Landlord") and Marie Callender Pie Shops Inc.("Tenant"),
dated September 27, 1999, Seller is not aware of any leases
of the Property. The above referenced lease agreement has a
right of first refusal in favor of the Tenant as set forth
in Article 34 of said lease agreement, which right will
apply to any attempted disposition of Property by Buyer
after this transaction.
(ii) It is not aware of any pending litigation or
condemnation proceedings against the Property or Seller's
interest in the Property.
(iii) Except as previously disclosed to Buyer and as
permitted in paragraph (b) below, Seller is not aware of any
contracts Seller has executed that would be binding on Buyer
after the closing date.
(b) Provided that Buyer performs its obligations when
required, Seller agrees that it will not enter into any new
contracts that would materially affect the Property and be
binding on Buyer after the Closing Date without Buyer's
prior consent, which will not be unreasonably withheld.
However, Buyer acknowledges that Seller retains the right
both prior to and after the Closing Date to freely transfer
all or a portion of Seller's remaining undivided interest in
the Entire Property, provided such sale shall not encumber
the Property being purchased by Buyer in violation of the
terms hereof or the contemplated Co-Tenancy Agreement.
12. DISCLOSURES.
(a) Seller has not received any notice of any material,
physical, or mechanical defects of the Entire Property,
including without limitation, the plumbing, heating, air
conditioning, ventilating, electrical system. To the best of
Seller's knowledge without inquiry, all such items are in
good operating condition and repair and in compliance with
all applicable governmental, zoning, and land use laws,
ordinances, regulations and requirements. If Seller shall
receive any notice to the contrary prior to Closing, Seller
will inform Buyer prior to Closing.
(b) Seller has not received any notice that the use and
operation of the Entire Property is not in full compliance
with applicable building codes, safety, fire, zoning, and
land use laws, and other applicable local, state and federal
laws, ordinances, regulations and requirements. If Seller
shall receive any notice to the contrary prior to Closing,
Seller will inform Buyer prior to Closing.
(c) Seller knows of no facts nor has Seller failed to disclose
to Buyer any fact known to Seller which would prevent the Tenant
from using and operating the Entire Property after the Closing in
the manner in which the Entire Property has been used and
operated
Buyer Initial: /s/ CRW
Purchase Agreement for Marie Callender's-Henderson, NV
prior to the date of this Agreement. If Seller shall
receive any notice to the contrary prior to Closing, Seller
will inform Buyer prior to Closing.
(d) Seller has not received any notice that the Entire
Property is in violation of any federal, state or local law,
ordinance, or regulations relating to industrial hygiene or
the environmental conditions on, under, or about the Entire
Property, including, but not limited to, soil, and
groundwater conditions. To the best of Seller's knowledge,
there is no proceeding or inquiry by any governmental
authority with respect to the presence of Hazardous
Materials on the Entire Property or the migration of
Hazardous Materials from or to other property. Buyer agrees
that Seller will have no liability of any type to Buyer or
Buyer's successors, assigns, or affiliates in connection
with any Hazardous Materials on or in connection with the
Entire Property after the Closing Date. Seller shall
indemnify Buyer for any liability arising due to Hazardous
Materials on or in connection with the Entire Property prior
to the Closing Date. If Seller shall receive any notice to
the contrary prior to Closing, Seller will inform Buyer
prior to Closing.
(e) BUYER AGREES THAT IT SHALL BE PURCHASING THE PROPERTY
IN ITS THEN PRESENT CONDITION, AS IS, WHERE IS, AND SELLER
HAS NO OBLIGATIONS TO CONSTRUCT OR REPAIR ANY IMPROVEMENTS
THEREON OR TO PERFORM ANY OTHER ACT REGARDING THE PROPERTY,
EXCEPT AS EXPRESSLY PROVIDED HEREIN.
(f) BUYER ACKNOWLEDGES THAT, HAVING BEEN GIVEN THE
OPPORTUNITY TO INSPECT THE ENTIRE PROPERTY AND SUCH
FINANCIAL INFORMATION ON THE LESSEE AND GUARANTORS OF THE
LEASE AS BUYER OR ITS ADVISORS SHALL REQUEST, IF IN SELLER'S
POSSESSION, BUYER IS RELYING SOLELY ON ITS OWN INVESTIGATION
OF THE PROPERTY AND NOT ON ANY INFORMATION PROVIDED BY
SELLER OR TO BE PROVIDED EXCEPT AS SET FORTH HEREIN. BUYER
FURTHER ACKNOWLEDGES THAT THE INFORMATION PROVIDED AND TO BE
PROVIDED BY SELLER WITH RESPECT TO THE PROPERTY, THE ENTIRE
PROPERTY AND TO THE LESSEE AND GUARANTORS OF LEASE WAS
OBTAINED FROM A VARIETY OF SOURCES AND SELLER NEITHER (A)
HAS MADE INDEPENDENT INVESTIGATION OR VERIFICATION OF SUCH
INFORMATION, OR (B) MAKES ANY REPRESENTATIONS AS TO THE
ACCURACY OR COMPLETENESS OF SUCH INFORMATION EXCEPT AS
HEREIN SET FORTH. THE SALE OF THE PROPERTY AS PROVIDED FOR
HEREIN IS MADE ON AN "AS IS" BASIS, AND BUYER EXPRESSLY
ACKNOWLEDGES THAT, IN CONSIDERATION OF THE AGREEMENTS OF
SELLER HEREIN, EXCEPT AS OTHERWISE SPECIFIED HEREIN IN
PARAGRAPH 11(A) AND (B) ABOVE AND THIS PARAGRAPH 12, SELLER
MAKES NO WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, OR
ARISING BY OPERATION OF LAW, INCLUDING, BUT NOT LIMITED TO,
ANY WARRANTY OF CONDITION, HABITABILITY, TENANTABILITY,
SUITABILITY FOR COMMERCIAL PURPOSES, MERCHANTABILITY, OR
FITNESS FOR A PARTICULAR PURPOSE, IN RESPECT OF THE
PROPERTY.
The provisions (d) - (f) above shall survive Closing.
13. CLOSING.
(a) Before the closing date, Seller will deposit into escrow an
executed special warranty deed warranting title against lawful
claims by, through, or under a conveyance
Buyer Initial: /s/ CRW
Purchase Agreement for Marie Callender's-Henderson, NV
from Seller, but not further or otherwise, conveying
insurable title of the Property to Buyer, subject to the
exceptions contained in paragraph 8 above.
(b) On or before the closing date, Buyer will deposit into
escrow: the balance of the purchase price when required
under Section 4; any additional funds required of Buyer,
(pursuant to this agreement or any other agreement executed
by Buyer) to close escrow. Both parties will sign and
deliver to the escrow holder any other documents reasonably
required by the escrow holder to close escrow.
(c) On the closing date, if escrow is in a position to
close, the escrow holder will: record the deed in the
official records of the county where the Property is
located; cause the title company to commit to issue the
title policy; immediately deliver to Seller the portion of
the purchase price deposited into escrow by cashier's check
or wire transfer (less debits and prorations, if any);
deliver to Seller and Buyer a signed counterpart of the
escrow holder's certified closing statement and take all
other actions necessary to close escrow.
14. DEFAULTS. If Buyer defaults, Buyer will forfeit all rights
and claims and Seller will be relieved of all obligations and
will be entitled to retain all monies heretofore paid by the
Buyer. In addition, Seller shall retain all remedies available
to Seller at law or in equity.
If Seller shall default, Buyer irrevocably waives any rights
to file a lis pendens, a specific performance action or any other
claim, action or proceeding of any type in connection with the
Property or this or any other transaction involving the Property,
and will not do anything to affect title to the Property or
hinder, delay or prevent any other sale, lease or other
transaction involving the Property (any and all of which will be
null and void), unless: it has paid the First Payment, deposited
the balance of the Second Payment for the purchase price into
escrow, performed all of its other obligations and satisfied all
conditions under this Agreement, and unconditionally notified
Seller that it stands ready to tender full performance, purchase
the Property and close escrow as per this Agreement, regardless
of any alleged default or misconduct by Seller. Provided,
however, that in no event shall Seller be liable for any
punitive, consequential or speculative damages arising out of any
default by Seller hereunder.
15. BUYER'S REPRESENTATIONS AND WARRANTIES.
a. Buyer represents and warrants to Seller as follows:
(i) In addition to the acts and deeds recited herein and
contemplated to be performed, executed, and delivered by
Buyer, Buyer shall perform, execute and deliver or cause to
be performed, executed, and delivered at the Closing or
after the Closing, any and all further acts, deeds and
assurances as Seller or the Title Company may require and be
reasonable in order to consummate the transactions
contemplated herein.
(ii) Buyer has all requisite power and authority to consummate
the transaction contemplated by this Agreement and has by proper
proceedings duly authorized the
Buyer Initial: /s/ CRW
Purchase Agreement for Marie Callender's-Henderson, NV
execution and delivery of this Agreement and the
consummation of the transaction contemplated hereby.
(iii) To Buyer's knowledge, neither the execution and
delivery of this Agreement nor the consummation of the
transaction contemplated hereby will violate or be in
conflict with (a) any applicable provisions of law, (b) any
order of any court or other agency of government having
jurisdiction hereof, or (c) any agreement or instrument to
which Buyer is a party or by which Buyer is bound.
16. DAMAGES, DESTRUCTION AND EMINENT DOMAIN.
(a) If, prior to closing, the Property or any part thereof
is destroyed or further damaged by fire, the elements, or
any cause, due to events occurring subsequent to the date of
this Agreement to the extent that the cost of repair exceeds
$10,000.00, this Agreement shall become null and void, at
Buyer's option exercised, if at all, by written notice to
Seller within ten (10) days after Buyer has received written
notice from Seller of said destruction or damage. Seller,
however, shall have the right to adjust or settle any
insured loss until (i) all contingencies set forth in
Paragraph 6 hereof have been satisfied, or waived; and (ii)
any ten-day period provided for above in this Subparagraph
16a for Buyer to elect to terminate this Agreement has
expired or Buyer has, by written notice to Seller, waived
Buyer's right to terminate this Agreement. If Buyer elects
to proceed and to consummate the purchase despite said
damage or destruction, there shall be no reduction in or
abatement of the purchase price, and Seller shall assign to
Buyer the Seller's right, title, and interest in and to all
insurance proceeds (pro-rata in relation to the Entire
Property) resulting from said damage or destruction to the
extent that the same are payable with respect to damage to
the Property, subject to rights of any Tenant of the Entire
Property.
If the cost of repair is less than $10,000.00, Buyer shall
be obligated to otherwise perform hereinunder with no
adjustment to the Purchase Price, reduction or abatement,
and Seller shall assign Seller's right, title and interest
in and to all insurance proceeds pro-rata in relation to the
Entire Property, subject to rights of any Tenant of the
Entire Property.
(b) If, prior to closing, the Property, or any part
thereof, is taken by eminent domain, this Agreement shall
become null and void, at Buyer's option. If Buyer elects to
proceed and to consummate the purchase despite said taking,
there shall be no reduction in, or abatement of, the
purchase price, and Seller shall assign to Buyer the
Seller's right, title, and interest in and to any award
made, or to be made, in the condemnation proceeding pro-rata
in relation to the Entire Property, subject to rights of any
Tenant of the Entire Property.
In the event that this Agreement is terminated by Buyer as
provided above in Subparagraph 16a or 16b, the First Payment
shall be immediately returned to Buyer (after execution by Buyer
of such documents reasonably requested by Seller to evidence the
termination hereof).
Buyer Initial: /s/ CRW
Purchase Agreement for Marie Callender's-Henderson, NV
17. BUYER'S 1031 TAX FREE EXCHANGE.
While Seller acknowledges that Buyer is purchasing the
Property as "replacement property" to accomplish a tax free
exchange, Buyer acknowledges that Seller has made no
representations, warranties, or agreements to Buyer or Buyer's
agents that the transaction contemplated by the Agreement will
qualify for such tax treatment, nor has there been any reliance
thereon by Buyer respecting the legal or tax implications of the
transactions contemplated hereby. Buyer further represents that
it has sought and obtained such third party advice and counsel as
it deems necessary in regards to the tax implications of this
transaction.
Buyer wishes to novate/assign the ownership rights and
interest of this Purchase Agreement to G.T. Transfer and Exchange
Corporation, which will act as Accommodator to perfect the 1031
exchange by preparing an agreement of exchange of Real Property
whereby G.T. Transfer and Exchange Corporation, will be an
independent third party purchasing the ownership interest in
subject property from Seller and selling the ownership interest
in subject property to Buyer under the same terms and conditions
as documented in this Purchase Agreement. Seller consents to
such assignments. Buyer asks the Seller, and Seller agrees to
cooperate in the perfection of such an exchange if at no
additional cost or expense to Seller or delay in time. Buyer
hereby indemnifies and holds Seller harmless from any claims
and/or actions resulting from said exchange. Pursuant to the
direction of G.T. Transfer and Exchange Corporation, Seller will
deed the Property directly to Buyer.
18. CANCELLATION
If any party elects to cancel this Contract because of any
breach by another party or because escrow fails to close by
the agreed date, the party electing to cancel shall deliver
to escrow agent a notice containing the address of the party
in breach and stating that this Contract shall be cancelled
unless the breach is cured within 10 days following the
delivery of the notice to the escrow agent. Within three
days after receipt of such notice, the escrow agent shall
send it by United States Mail to the party in breach at the
address contained in the Notice and no further notice shall
be required. If the breach is not cured within the 10 days
following the delivery of the notice to the escrow agent,
this Contract shall be cancelled.
19. MISCELLANEOUS.
(a) This Agreement may be amended only by written agreement
signed by both Seller and Buyer, and all waivers must be in
writing and signed by the waiving party. Time is of the
essence. This Agreement will not be construed for or
against a party whether or not that party has drafted this
Agreement. If there is any action or proceeding between the
parties relating to this Agreement the prevailing party will
be entitled to recover attorney's fees and costs. This is
an integrated agreement containing all agreements of the
parties about the Property and the other matters described,
and it supersedes any other agreements or understandings.
Exhibits attached to this Agreement are incorporated into
this Agreement.
Buyer Initial: /s/ CRW
Purchase Agreement for Marie Callender's-Henderson, NV
(b) If this escrow has not closed by April 30, 2000,
through no fault of Seller, Seller may either, at its
election, extend the closing date or exercise any remedy
available to it by law, including terminating this
Agreement.
(c) Funds to be deposited or paid by Buyer must be good and
clear funds in the form of cash, cashier's checks or wire
transfers.
(d) All notices from either of the parties hereto to the
other shall be in writing and shall be considered to have
been duly given or served if sent by first class certified
mail, return receipt requested, postage prepaid, or by a
nationally recognized courier service guaranteeing overnight
delivery to the party at his or its address set forth below,
or to such other address as such party may hereafter
designate by written notice to the other party.
If to Seller:
Attention: Robert P. Johnson
AEI Income & Growth Fund XXII Limited Partnership
1300 Minnesota World Trade Center
30 E. 7th Street
St. Paul, MN 55101
If to Buyer:
Carl R. Whittington, Trustee
1440 Elm Grove Avenue
Akron, OH 44312
When accepted, this offer will be a binding agreement for
valid and sufficient consideration which will bind and benefit
Buyer, Seller and their respective successors and assigns. Buyer
is submitting this offer by signing a copy of this offer and
delivering it to Seller. Seller has five (5) business days from
receipt within which to accept this offer.
REST OF PAGE INTENTIONALLY LEFT BLANK.
Buyer Initial: /s/ CRW
Purchase Agreement for Marie Callender's-Henderson, NV
IN WITNESS WHEREOF, the Seller and Buyer have executed this
Agreement effective as of the day and year above first written.
BUYER: Carl R. Whittington, Trustee of the Carl R.
Whittington Trust dated October 16, 1996
By:/s/ Carl R Whittington
Carl R. Whittington, Trustee
Witness /s/ Marilyn Dodson
SELLER: AEI Income & Growth Fund XXII Limited Partnership
By: AEI Fund Management XXI, Inc., its corporate
general partner
By: /s/ Robert P Johnson
Robert P. Johnson, President
Witness /s/ Jill Rayburn
Jill Rayburn
Buyer Initial: /s/ CRW
Purchase Agreement for Marie Callender's-Henderson, NV
EXHIBIT "A"
LEGAL DESCRIPTION
(Henderson, Nevada)
Being a division of Lot One (1) as shown upon the FINAL MAP
OF GALLERIA COMMONS ( a commercial subdivision) as depicted
in Book 79, Page 48 of Plats, Official Records, Clark
County, Nevada, also being a portion of the West Half (W
1/2) of the Southwest Quarter (SW 1/4) of Section 3,
Township 22 South, Range 62 East, M.D.M., City of Henderson,
Clark County, Nevada, more particularly described as
follows:
Commencing at the West Quarter Corner (w 1/4 Cor.) of said
Section 3, said corner being common to Sections 3 and 4;
Thence South 00 14' 06" West along the West line of said
Section 3, a distance of 808.13 feet;
Thence North 88 55' 32" East, a distance of 50.01 fee to a
point on the Easterly right of way line of Stephanie Street'
Thence south 00 14' 06" West along said Easterly right of
way line, a distance of 585.62 feet;
Thence South 89 45' 54" East, a distance of 20.00 feet to
the Point of Beginning;
Thence North 88 51' 28" East, a distance of 147.22 feet;
Thence South 01 05' 43" East, a distance of 108.33 feet;
Thence South 88 51' 28" West, a distance of 2.92 feet;
Thence South 89 56' 32" West, a distance of 149.41 feet;
Thence North 00 14' 06" East, a distance of 284.89 feet to
the POINT OF BEGINNING
PURCHASE AGREEMENT
Hollywood Video - Saraland, AL
This AGREEMENT, entered into effective as of the 27th of March,
2000.
l. PARTIES. Seller is AEI Income & Growth Fund XXII Limited
Partnership which owns an undivided 100% interest in the fee
title to that certain real property legally described in the
attached Exhibit "A" (the "Entire Property") Buyer is Carl R.
Whittington, Trustee of the Carl R. Whittington Trust dated
October 16, 1996 ("Buyer"). Seller wishes to sell and Buyer
wishes to buy a portion of Seller's tenant in common interest in
the Entire Property.
2. PROPERTY. The Property to be sold to Buyer in this transaction
consists of an undivided 12.1242 percentage interest
(hereinafter, simply the "Property") as Tenant in Common in the
Entire Property.
3. PURCHASE PRICE. The purchase price for this percentage
interest in the Entire Property is $224,500, all cash.
4. TERMS. The purchase price for the Property will be paid by
Buyer as follows:
(a) When this agreement is executed, Buyer will pay $5,000
to Seller (which shall be deposited into escrow according to
the terms hereof) (the "First Payment"). The First Payment
will be credited against the purchase price when and if
escrow closes and the sale is completed.
(b) Buyer will deposit the balance of the purchase price,
219,500 (the "Second Payment") into escrow in sufficient
time to allow escrow to close on the closing date.
5. CLOSING DATE. Escrow is anticipated to close on or before
March 31, 2000.
6. DUE DILIGENCE. Buyer will have until the expiration of the
tenth business day (The "Review Period") after delivery of each
of following items, to be supplied by Seller, to conduct all of
its inspections and due diligence and satisfy itself regarding
each item, the Property, and this transaction. Buyer agrees to
indemnify and hold Seller harmless for any loss or damage to the
Entire Property or persons caused by Buyer or its agents arising
out of such physical inspections of the Entire Property.
(a) The original and one copy of a title insurance
commitment for an Owner's Title insurance policy (see
paragraph 8 below).
(b) A copy of a Certificate of Occupancy or other such
document certifying completion and granting permission to
permanently occupy the improvements on the Entire Property
as are in Seller's possession.
(c) A copy of an "as built" survey of the Entire Property
done concurrent with Seller's acquisition of the Property.
Buyer Initial: /s/ CRW
Purchase Agreement for Hollywood Video, Saraland, AL
(d) Lease (as further set forth in paragraph 11(a) below) of
the Entire Property showing occupancy date, lease expiration
date, rent, and Guarantys, if any, accompanied by such
tenant financial statements as may have been provided most
recently to Seller by the Tenant and/or Guarantors.
It is a contingency upon Seller's obligations hereunder that
two (2) copies of Co-Tenancy Agreement in the form attached
hereto duly executed by Buyer and Seller and dated on escrow
closing date be delivered to the Seller on the closing date.
Buyer may cancel this agreement for ANY REASON in its sole
discretion by delivering a cancellation notice, via first class
mail, return receipt requested, to Seller and escrow holder
before the expiration of the Review Period. Such notice shall be
deemed effective only upon receipt by Seller. If this Agreement
is not cancelled as set forth above, the First Payment shall be
non-refundable unless Seller shall default hereunder.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under the first paragraph of sections 6 of this
agreement (which will survive), Buyer (after execution of such
documents reasonably requested by Seller to evidence the
termination hereof) shall be returned its First Payment, and
Buyer will have absolutely no rights, claims or interest of any
type in connection with the Property or this transaction,
regardless of any alleged conduct by Seller or anyone else.
Unless this Agreement is canceled by Buyer pursuant to the
terms hereof, if Buyer fails to make the Second Payment, Seller
shall be entitled to retain the First Payment and Buyer
irrevocably will be deemed to be in default under this Agreement.
Seller may, at its option, retain the First Payment and declare
this Agreement null and void, in which event Buyer will be deemed
to have canceled this Agreement and relinquish all rights in and
to the Property or Seller may exercise its rights under Section
14 hereof. If this Agreement is not canceled and the Second
Payment is made when required, all of Buyer's conditions and
contingencies will be deemed satisfied.
7. ESCROW. Escrow shall be opened by Seller and funds deposited
in escrow upon acceptance of this agreement by both parties. The
escrow holder will be a nationally-recognized escrow company
selected by Seller. A copy of this Agreement will be delivered to
the escrow holder and will serve as escrow instructions together
with the escrow holder's standard instructions and any additional
instructions required by the escrow holder to clarify its rights
and duties (and the parties agree to sign these additional
instructions). If there is any conflict between these other
instructions and this Agreement, this Agreement will control.
8. TITLE. Closing will be conditioned on the commitment of a
title company selected by Seller to issue an Owner's policy of
title insurance, dated as of the close of escrow, in an amount
equal to the purchase price, insuring that Buyer will own
insurable title to the Property subject only to: the title
company's standard exceptions; current real property taxes and
assessments; survey exceptions; the rights of parties in
possession pursuant to the lease defined in paragraph 11 below;
all matters of public record as shown in the title commitment;
and other items disclosed to Buyer during the Review Period.
Buyer Initial: /s/ CRW
Purchase Agreement for Hollywood Video, Saraland, AL
Buyer shall be allowed ten (10) days after receipt of said
commitment for examination and the making of any objections to
marketability thereto, said objections to be made in writing or
deemed waived. If any objections are so made, the Seller shall
be allowed eighty (80) days to make such title marketable or in
the alternative to obtain a commitment for insurable title
insuring over Buyer's objections. If Seller shall decide to make
no efforts to make title marketable, or is unable to make title
marketable or obtain insurable title, (after execution by Buyer
of such documents reasonably requested by Seller to evidence the
termination hereof) Buyer's First Payment shall be returned and
this Agreement shall be null and void and of no further force and
effect. Seller has no obligation to spend any funds or make any
effort to satisfy Buyer's objections if any.
Pending satisfaction of Buyer's objections, the payments
hereunder required shall be postponed, but upon satisfaction of
Buyer's objections and within ten (10) days after written notice
of satisfaction of Buyer's objections to the Buyer, the parties
shall perform this Agreement according to its terms.
9. CLOSING COSTS. Seller will pay one-half of escrow fees, the
cost of the title commitment and any brokerage commissions
payable. The Buyer will pay the cost of issuing a Standard
Owners Title Insurance Policy in the full amount of the purchase
price, if Buyer shall decide to purchase the same. Buyer will
pay all recording fees, one-half of the escrow fees, and the cost
of an update to the Survey in Sellers possession (if an update is
required by Buyer.) Each party will pay its own attorney's fees
and costs to document and close this transaction.
10. REAL ESTATE TAXES, SPECIAL ASSESSMENTS AND PRORATIONS.
(a) Because the Entire Property (of which the Property is a
part) is subject to a triple net lease (as further set forth
in paragraph 11(a)(i), the parties acknowledge that there
shall be no need for a real estate tax proration. However,
Seller represents that to the best of its knowledge, all
real estate taxes and installments of special assessments
due and payable in all years prior to the year of Closing
have been paid in full. Unpaid real estate taxes and unpaid
levied and pending special assessments existing on the date
of Closing shall be the responsibility of Buyer and Seller
in proportion to their respective Tenant in Common
interests, pro-rated, however, to the date of closing for
the period prior to closing, which shall be the
responsibility of Seller if Tenant shall not pay the same.
Seller and Buyer shall likewise pay all taxes due and
payable in the year after Closing and any unpaid
installments of special assessments payable therewith and
thereafter, if such unpaid levied and pending special
assessments and real estate taxes are not paid by any tenant
of the Entire Property.
(b) All income and all operating expenses from the Entire
Property shall be prorated between the parties and adjusted by
them as of the date of Closing. Seller shall be entitled to all
income earned and shall be responsible for all expenses incurred
prior to the date of Closing, and Buyer shall be entitled to its
proportionate share of all income earned and shall be responsible
for its proportionate share of all operating expenses of the
Entire Property incurred on and after the date of closing.
Buyer Initial: /s/ CRW
Purchase Agreement for Hollywood Video, Saraland, AL
11. SELLER'S REPRESENTATION AND AGREEMENTS.
(a) Seller represents and warrants as of this date that:
(i) Except for the lease in existence between Centurion
Video, LTD (as "Landlord") and Hollywood Entertainment
Corporation ("as Tenant") dated September 27, 1997 and the
assignment of lease from Centurion Video, LTD ("Centurion",
Assignor") to AEI Income & Growth Fund XXII Limited
Partnership ("AEI", "Assignee") dated January 12, 1999,
Seller is not aware of any leases of the Property.
(ii) It is not aware of any pending litigation or
condemnation proceedings against the Property or Seller's
interest in the Property.
(iii) Except as previously disclosed to Buyer and as
permitted in paragraph (b) below, Seller is not aware of any
contracts Seller has executed that would be binding on Buyer
after the closing date.
(b) Provided that Buyer performs its obligations when
required, Seller agrees that it will not enter into any new
contracts that would materially affect the Property and be
binding on Buyer after the Closing Date without Buyer's
prior consent, which will not be unreasonably withheld.
However, Buyer acknowledges that Seller retains the right
both prior to and after the Closing Date to freely transfer
all or a portion of Seller's remaining undivided interest in
the Entire Property, provided such sale shall not encumber
the Property being purchased by Buyer in violation of the
terms hereof or the contemplated Co-Tenancy Agreement.
12. DISCLOSURES.
(a) Seller has not received any notice of any material,
physical, or mechanical defects of the Entire Property,
including without limitation, the plumbing, heating, air
conditioning, ventilating, electrical system. To the best of
Seller's knowledge without inquiry, all such items are in
good operating condition and repair and in compliance with
all applicable governmental, zoning, and land use laws,
ordinances, regulations and requirements. If Seller shall
receive any notice to the contrary prior to Closing, Seller
will inform Buyer prior to Closing.
(b) Seller has not received any notice that the use and
operation of the Entire Property is not in full compliance
with applicable building codes, safety, fire, zoning, and
land use laws, and other applicable local, state and federal
laws, ordinances, regulations and requirements. If Seller
shall receive any notice to the contrary prior to Closing,
Seller will inform Buyer prior to Closing.
(c) Seller knows of no facts nor has Seller failed to disclose
to Buyer any fact known to Seller which would prevent the Tenant
from using and operating the Entire Property after the Closing in
the manner in which the Entire Property has been used and
operated prior to the date of this Agreement. If Seller shall
receive any notice to the contrary prior to Closing, Seller will
inform Buyer prior to Closing.
Buyer Initial: /s/ CRW
Purchase Agreement for Hollywood Video, Saraland, AL
(d) Seller has not received any notice that the Entire
Property is in violation of any federal, state or local law,
ordinance, or regulations relating to industrial hygiene or
the environmental conditions on, under, or about the Entire
Property, including, but not limited to, soil, and
groundwater conditions. To the best of Seller's knowledge,
there is no proceeding or inquiry by any governmental
authority with respect to the presence of Hazardous
Materials on the Entire Property or the migration of
Hazardous Materials from or to other property. Buyer agrees
that Seller will have no liability of any type to Buyer or
Buyer's successors, assigns, or affiliates in connection
with any Hazardous Materials on or in connection with the
Entire Property either before or after the Closing Date,
except such Hazardous Materials on or in connection with the
Entire Property arising out of Seller's gross negligence or
intentional misconduct. If Seller shall receive any notice
to the contrary prior to Closing, Seller will inform Buyer
prior to Closing.
(e) BUYER AGREES THAT IT SHALL BE PURCHASING THE PROPERTY
IN ITS THEN PRESENT CONDITION, AS IS, WHERE IS, AND SELLER
HAS NO OBLIGATIONS TO CONSTRUCT OR REPAIR ANY IMPROVEMENTS
THEREON OR TO PERFORM ANY OTHER ACT REGARDING THE PROPERTY,
EXCEPT AS EXPRESSLY PROVIDED HEREIN.
(f) BUYER ACKNOWLEDGES THAT, HAVING BEEN GIVEN THE
OPPORTUNITY TO INSPECT THE ENTIRE PROPERTY AND SUCH
FINANCIAL INFORMATION ON THE LESSEE AND GUARANTORS OF THE
LEASE AS BUYER OR ITS ADVISORS SHALL REQUEST, IF IN SELLER'S
POSSESSION, BUYER IS RELYING SOLELY ON ITS OWN INVESTIGATION
OF THE PROPERTY AND NOT ON ANY INFORMATION PROVIDED BY
SELLER OR TO BE PROVIDED EXCEPT AS SET FORTH HEREIN. BUYER
FURTHER ACKNOWLEDGES THAT THE INFORMATION PROVIDED AND TO BE
PROVIDED BY SELLER WITH RESPECT TO THE PROPERTY, THE ENTIRE
PROPERTY AND TO THE LESSEE AND GUARANTORS OF LEASE WAS
OBTAINED FROM A VARIETY OF SOURCES AND SELLER NEITHER (A)
HAS MADE INDEPENDENT INVESTIGATION OR VERIFICATION OF SUCH
INFORMATION, OR (B) MAKES ANY REPRESENTATIONS AS TO THE
ACCURACY OR COMPLETENESS OF SUCH INFORMATION EXCEPT AS
HEREIN SET FORTH. THE SALE OF THE PROPERTY AS PROVIDED FOR
HEREIN IS MADE ON AN "AS IS" BASIS, AND BUYER EXPRESSLY
ACKNOWLEDGES THAT, IN CONSIDERATION OF THE AGREEMENTS OF
SELLER HEREIN, EXCEPT AS OTHERWISE SPECIFIED HEREIN IN
PARAGRAPH 11(A) AND (B) ABOVE AND THIS PARAGRAPH 12, SELLER
MAKES NO WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, OR
ARISING BY OPERATION OF LAW, INCLUDING, BUT NOT LIMITED TO,
ANY WARRANTY OF CONDITION, HABITABILITY, TENANTABILITY,
SUITABILITY FOR COMMERCIAL PURPOSES, MERCHANTABILITY, OR
FITNESS FOR A PARTICULAR PURPOSE, IN RESPECT OF THE
PROPERTY.
The provisions (d) - (f) above shall survive Closing.
13. CLOSING.
(a) Before the closing date, Seller will deposit into escrow an
executed special warranty deed warranting title against lawful
claims by, through, or under a conveyance from Seller, but not
further or otherwise, conveying insurable title of the Property
to Buyer, subject to the exceptions contained in paragraph 8
above.
Buyer Initial: /s/ CRW
Purchase Agreement for Hollywood Video, Saraland, AL
(b) On or before the closing date, Buyer will deposit into
escrow: the balance of the purchase price when required
under Section 4; any additional funds required of Buyer,
(pursuant to this agreement or any other agreement executed
by Buyer) to close escrow. Both parties will sign and
deliver to the escrow holder any other documents reasonably
required by the escrow holder to close escrow.
(c) On the closing date, if escrow is in a position to
close, the escrow holder will: record the deed in the
official records of the county where the Property is
located; cause the title company to commit to issue the
title policy; immediately deliver to Seller the portion of
the purchase price deposited into escrow by cashier's check
or wire transfer (less debits and prorations, if any);
deliver to Seller and Buyer a signed counterpart of the
escrow holder's certified closing statement and take all
other actions necessary to close escrow.
14. DEFAULTS. If Buyer defaults, Buyer will forfeit all rights
and claims and Seller will be relieved of all obligations and
will be entitled to retain all monies heretofore paid by the
Buyer. In addition, Seller shall retain all remedies available
to Seller at law or in equity.
If Seller shall default, Buyer irrevocably waives any rights
to file a lis pendens, a specific performance action or any other
claim, action or proceeding of any type in connection with the
Property or this or any other transaction involving the Property,
and will not do anything to affect title to the Property or
hinder, delay or prevent any other sale, lease or other
transaction involving the Property (any and all of which will be
null and void), unless: it has paid the First Payment, deposited
the balance of the Second Payment for the purchase price into
escrow, performed all of its other obligations and satisfied all
conditions under this Agreement, and unconditionally notified
Seller that it stands ready to tender full performance, purchase
the Property and close escrow as per this Agreement, regardless
of any alleged default or misconduct by Seller. Provided,
however, that in no event shall Seller be liable for any actual,
punitive, consequential or speculative damages arising out of any
default by Seller hereunder.
15. BUYER'S REPRESENTATIONS AND WARRANTIES.
a. Buyer represents and warrants to Seller as follows:
(i) In addition to the acts and deeds recited herein and
contemplated to be performed, executed, and delivered by
Buyer, Buyer shall perform, execute and deliver or cause to
be performed, executed, and delivered at the Closing or
after the Closing, any and all further acts, deeds and
assurances as Seller or the Title Company may require and be
reasonable in order to consummate the transactions
contemplated herein.
(ii) Buyer has all requisite power and authority to
consummate the transaction contemplated by this Agreement
and has by proper proceedings duly authorized the execution
and delivery of this Agreement and the consummation of the
transaction contemplated hereby.
Buyer Initial: /s/ CRW
Purchase Agreement for Hollywood Video, Saraland, AL
(iii) To Buyer's knowledge, neither the execution and
delivery of this Agreement nor the consummation of the
transaction contemplated hereby will violate or be in
conflict with (a) any applicable provisions of law, (b) any
order of any court or other agency of government having
jurisdiction hereof, or (c) any agreement or instrument to
which Buyer is a party or by which Buyer is bound.
16. DAMAGES, DESTRUCTION AND EMINENT DOMAIN.
(a) If, prior to closing, the Property or any part thereof
is destroyed or further damaged by fire, the elements, or
any cause, due to events occurring subsequent to the date of
this Agreement to the extent that the cost of repair exceeds
$10,000.00, this Agreement shall become null and void, at
Buyer's option exercised, if at all, by written notice to
Seller within ten (10) days after Buyer has received written
notice from Seller of said destruction or damage. Seller,
however, shall have the right to adjust or settle any
insured loss until (i) all contingencies set forth in
Paragraph 6 hereof have been satisfied, or waived; and (ii)
any ten-day period provided for above in this Subparagraph
16a for Buyer to elect to terminate this Agreement has
expired or Buyer has, by written notice to Seller, waived
Buyer's right to terminate this Agreement. If Buyer elects
to proceed and to consummate the purchase despite said
damage or destruction, there shall be no reduction in or
abatement of the purchase price, and Seller shall assign to
Buyer the Seller's right, title, and interest in and to all
insurance proceeds (pro-rata in relation to the Entire
Property) resulting from said damage or destruction to the
extent that the same are payable with respect to damage to
the Property, subject to rights of any Tenant of the Entire
Property.
If the cost of repair is less than $10,000.00, Buyer shall
be obligated to otherwise perform hereinunder with no
adjustment to the Purchase Price, reduction or abatement,
and Seller shall assign Seller's right, title and interest
in and to all insurance proceeds pro-rata in relation to the
Entire Property, subject to rights of any Tenant of the
Entire Property.
(b) If, prior to closing, the Property, or any part
thereof, is taken by eminent domain, this Agreement shall
become null and void, at Buyer's option. If Buyer elects to
proceed and to consummate the purchase despite said taking,
there shall be no reduction in, or abatement of, the
purchase price, and Seller shall assign to Buyer the
Seller's right, title, and interest in and to any award
made, or to be made, in the condemnation proceeding pro-rata
in relation to the Entire Property, subject to rights of any
Tenant of the Entire Property.
In the event that this Agreement is terminated by Buyer as
provided above in Subparagraph 16a or 16b, the First Payment
shall be immediately returned to Buyer (after execution by Buyer
of such documents reasonably requested by Seller to evidence the
termination hereof).
Buyer Initial: /s/ CRW
Purchase Agreement for Hollywood Video, Saraland, AL
17. BUYER'S 1031 TAX FREE EXCHANGE.
While Seller acknowledges that Buyer is purchasing the
Property as "replacement property" to accomplish a tax free
exchange, Buyer acknowledges that Seller has made no
representations, warranties, or agreements to Buyer or Buyer's
agents that the transaction contemplated by the Agreement will
qualify for such tax treatment, nor has there been any reliance
thereon by Buyer respecting the legal or tax implications of the
transactions contemplated hereby. Buyer further represents that
it has sought and obtained such third party advice and counsel as
it deems necessary in regards to the tax implications of this
transaction.
Buyer wishes to novate/assign the ownership rights and
interest of this Purchase Agreement to G.T. Transfer and Exchange
Corporation, which will act as Accommodator to perfect the 1031
exchange by preparing an agreement of exchange of Real Property
whereby G.T. Transfer and Exchange Corporation, will be an
independent third party purchasing the ownership interest in
subject property from Seller and selling the ownership interest
in subject property to Buyer under the same terms and conditions
as documented in this Purchase Agreement. Seller consents to
such assignments. Buyer asks the Seller, and Seller agrees to
cooperate in the perfection of such an exchange if at no
additional cost or expense to Seller or delay in time. Buyer
hereby indemnifies and holds Seller harmless from any claims
and/or actions resulting from said exchange. Pursuant to the
direction of G.T. Transfer and Exchange Corporation, Seller will
deed the Property directly to Buyer.
18. CANCELLATION
If any party elects to cancel this Contract because of any
breach by another party or because escrow fails to close by
the agreed date, the party electing to cancel shall deliver
to escrow agent a notice containing the address of the party
in breach and stating that this Contract shall be cancelled
unless the breach is cured within 10 days following the
delivery of the notice to the escrow agent. Within three
days after receipt of such notice, the escrow agent shall
send it by United States Mail to the party in breach at the
address contained in the Notice and no further notice shall
be required. If the breach is not cured within the 10 days
following the delivery of the notice to the escrow agent,
this Contract shall be cancelled.
19. MISCELLANEOUS.
(a) This Agreement may be amended only by written agreement
signed by both Seller and Buyer, and all waivers must be in
writing and signed by the waiving party. Time is of the
essence. This Agreement will not be construed for or
against a party whether or not that party has drafted this
Agreement. If there is any action or proceeding between the
parties relating to this Agreement the prevailing party will
be entitled to recover attorney's fees and costs. This is
an integrated agreement containing all agreements of the
parties about the Property and the other matters described,
and it supersedes any other agreements or understandings.
Exhibits attached to this Agreement are incorporated into
this Agreement.
Buyer Initial: /s/ CRW
Purchase Agreement for Hollywood Video, Saraland, AL
(b) If this escrow has not closed by April 30, 2000,
through no fault of Seller, Seller may either, at its
election, extend the closing date or exercise any remedy
available to it by law, including terminating this
Agreement.
(c) Funds to be deposited or paid by Buyer must be good and
clear funds in the form of cash, cashier's checks or wire
transfers.
(d) All notices from either of the parties hereto to the
other shall be in writing and shall be considered to have
been duly given or served if sent by first class certified
mail, return receipt requested, postage prepaid, or by a
nationally recognized courier service guaranteeing overnight
delivery to the party at his or its address set forth below,
or to such other address as such party may hereafter
designate by written notice to the other party.
If to Seller:
Attention: Robert P. Johnson
AEI Income & Growth Fund XXII Limited Partnership
1300 Minnesota World Trade Center
30 E. 7th Street
St. Paul, MN 55101
If to Buyer:
Carl R. Whittington, Trustee
1440 Elm Grove Avenue
Akron, OH 44312
When accepted, this offer will be a binding agreement for
valid and sufficient consideration which will bind and benefit
Buyer, Seller and their respective successors and assigns. Buyer
is submitting this offer by signing a copy of this offer and
delivering it to Seller. Seller has five (5) business days from
receipt within which to accept this offer.
REST OF PAGE INTENTIONALLY LEFT BLANK
Buyer Initial: /s/ CRW
Purchase Agreement for Hollywood Video, Saraland, AL
IN WITNESS WHEREOF, the Seller and Buyer have executed this
Agreement effective as of the day and year above first written.
BUYER: Carl R. Whittington, Trustee of the Carl R. Whittington
Trust dated October 16, 1996
By:/s/ Carl R Whittington, Trustee
Carl R. Whittington, Trustee
Witness /s/ Marilyn Dodson
SELLER: AEI Income & Growth Fund XXII Limited Partnership
By: AEI Fund Management XXI, Inc., its corporate
general partner
By: /s/ Robert P Johsnon
Robert P. Johnson, President
Witness /s/ Jill Rayburn
Jill Rayburn
Buyer Initial: /s/ CRW
Purchase Agreement for Hollywood Video, Saraland, AL
EXHIBIT A
Lot 1, WAL*MART SQUARE, according to the plat thereof
recorded in Map Book 70, Page 25 of the probate Court
Records of Mobile County, Alabama.
PROPERTY CO-TENANCY
OWNERSHIP AGREEMENT
(Hollywood Video, Saraland, AL)
THIS CO-TENANCY AGREEMENT,
Made and entered into as of the 30th day of March, 2000, by and
between Carl R. Whittington, Trustee of the Carl R. Whittington
Trust dated October 16, 1996(hereinafter called "Whittington")
and AEI Income & Growth Fund XXII Limited Partnership
(hereinafter called "Fund XXII") Whittington, Fund XXII (and any
other Owner in Fee where the context so indicates) being
hereinafter sometimes collectively called "Co-Tenants" and
referred to in the neuter gender).
WITNESSETH:
WHEREAS, Fund XXII presently owns an undivided 87.8758% interest
in and to, and Whittington presently owns an undivided 12.1242%
interest in and to the land, situated in the City of Saraland,
County of Mobile, and State of AL, (legally described upon
Exhibit A attached hereto and hereby made a part hereof) and in
and to the improvements located thereon (hereinafter called
"Premises");
WHEREAS, The parties hereto wish to provide for the orderly
operation and management of the Premises and Whittington's
interest by Fund XXII; the continued leasing of space within the
Premises; for the distribution of income from and the pro-rata
sharing in expenses of the Premises.
NOW THEREFORE, in consideration of the purchase by Whittington of
an undivided interest in and to the Premises, for at least One
Dollar ($1.00) and other good and valuable consideration by the
parties hereto to one another in hand paid, the receipt and
sufficiency of which are hereby acknowledged, and of the mutual
covenants and agreements herein contained, it is hereby agreed by
and between the parties hereto, as follows:
1. The operation and management of the Premises shall be
delegated to Fund XXII, or its designated agent, successors or
assigns. Provided, however, if Fund XXII shall sell all of its
interest in the Premises, the duties and obligations of Fund XXII
respecting management of the Premises as set forth herein,
including but not limited to paragraphs 2, 3, and 4 hereof, shall
be exercised by the holder or holders of a majority undivided co-
tenancy interest in the Premises. Except as hereinafter expressly
provided to the contrary, each of the parties hereto agrees to be
bound by the decisions of Fund XXII with respect to all
administrative, operational and management matters of the
property comprising the Premises, including but not limited to
the management of the net lease agreement for the Premises.
Whittington hereto hereby designates Fund XXII as its sole and
exclusive agent to deal with, and Fund XXII retains the sole
right to deal with, any property agent or tenant and to negotiate
and enter into, on terms and provisions satisfactory to Fund
XXII, monitor, execute and enforce the terms of leases of space
within the Premises, including but not limited to any amendments,
consents to assignment, sublet, releases or modifications to
leases or guarantees of lease or easements affecting the
Premises, on behalf
Co-Tenant Initial: /s/ CRW
Co-Tenancy Agreement for Hollywood Video, Saraland, AL
of Whittington As long as Fund XXII owns an interest in the
Premises, only Fund XXII may obligate Whittington with respect
to any expense for the Premises.
As further set forth in paragraph 2 hereof, Fund XXII agrees to
require any lessee of the Premises to name Whittington as an
insured or additional insured in all insurance policies provided
for, or contemplated by, any lease on the Premises. Fund XXII
shall use its best efforts to obtain endorsements adding Co-
Tenants to said policies from lessee within 30 days of
commencement of this agreement. In any event, Fund XXII shall
distribute any insurance proceeds it may receive, to the extent
consistent with any lease on the Premises, to the Co-Tenants in
proportion to their respective ownership of the Premises.
2. Income and expenses shall be allocated among the Co-Tenants
in proportion to their respective share(s) of ownership. Shares
of net income shall be pro-rated for any partial calendar years
included within the term of this Agreement. Fund XXII may offset
against, pay to itself and deduct from any payment due to
Whittington under this Agreement, and may pay to itself the
amount of Whittington 's share of any reasonable expenses of the
Premises which are not paid by Whittington to Fund XXII or its
assigns, within ten (10) days after demand by Fund XXII. In the
event there is insufficient operating income from which to deduct
Whittington's unpaid share of operating expenses, Fund XXII may
pursue any and all legal remedies for collection.
Operating Expenses shall include all normal operating expense,
including but not limited to: maintenance, utilities, supplies,
labor, management, advertising and promotional expenses, salaries
and wages of rental and management personnel, leasing commissions
to third parties, a monthly accrual to pay insurance premiums,
real estate taxes, installments of special assessments and for
structural repairs and replacements, management fees, legal fees
and accounting fees, but excluding all operating expenses paid by
tenant under terms of any lease agreement of the Premises.
Whittington has no requirement to, but has, nonetheless elected
to retain, and agrees to annually reimburse, Fund XXII in the
amount of $550 for the expenses, direct and indirect, incurred by
Fund XXII in providing Whittington with quarterly accounting and
distributions of Whittington 's share of net income and for
tracking, reporting and assessing the calculation of Whittington
's share of operating expenses incurred from the Premises. This
invoice amount shall be pro-rated for partial years and
Whittington authorizes Fund XXII to deduct such amount from
Whittington's share of revenue from the Premises. Whittington may
terminate this agreement in this paragraph respecting accounting
and distributions at any time and attempt to collect its share of
rental income directly from the tenant; however, enforcement of
all other provisions of the lease remains the sole right of Fund
XXII pursuant to Section 1 hereof. Fund XXII may terminate its
obligation under this paragraph upon 30 days notice to
Whittington prior to the end of each anniversary hereof, unless
agreed in writing to the contrary.
3. Full, accurate and complete books of account shall be kept
in accordance with generally accepted accounting principles at
Fund XXII's principal office, and each Co-Tenant shall have
access to such books and may inspect and copy any part thereof
during normal business hours. Within ninety (90) days after the
end of each calendar year during the term hereof, Fund XXII
Co-Tenant Initial: /s/ CRW
Co-Tenancy Agreement for Hollywood Video, Saraland, AL
shall prepare an accurate income statement for the ownership
of the Premises for said calendar year and shall furnish
copies of the same to all Co-Tenants. Quarterly, as its share,
Whittington shall be entitled to receive 12.1242% of all items
of income and expense generated by the Premises. Upon receipt
of said accounting, if the payments received by each Co-Tenant
pursuant to this Paragraph 3 do not equal, in the aggregate,
the amounts which each are entitled to receive proportional to
its share of ownership with respect to said calendar year
pursuant to Paragraph 2 hereof, an appropriate adjustment
shall be made so that each Co-Tenant receives the amount to
which it is entitled.
4. If Net Income from the Premises is less than $0.00 (i.e.,
the Premises operates at a loss), or if capital improvements,
repairs, and/or replacements, for which adequate reserves do not
exist, need to be made to the Premises, the Co-Tenants, upon
receipt of a written request therefor from Fund XXII, shall,
within fifteen (15) business days after receipt of notice, make
payment to Fund XXII sufficient to pay said net operating losses
and to provide necessary operating capital for the premises and
to pay for said capital improvements, repairs and/or
replacements, all in proportion to their undivided interests in
and to the Premises.
5. Co-Tenants may, at any time, sell, finance, or otherwise
create a lien upon their interest in the Premises but only upon
their interest and not upon any part of the interest held, or
owned, by any other Co-Tenant. All Co-Tenants reserve the right
to escrow proceeds from a sale of their interests in the Premises
to obtain tax deferral by the purchase of replacement property.
6. If any Co-Tenant shall be in default with respect to any of
its obligations hereunder, and if said default is not corrected
within thirty (30) days after receipt by said defaulting Co-
Tenant of written notice of said default, or within a reasonable
period if said default does not consist solely of a failure to
pay money, the remaining Co-Tenant(s) may resort to any available
remedy to cure said default at law, in equity, or by statute.
7. This Co-Tenancy Agreement shall continue in full force and
effect and shall bind and inure to the benefit of the Co-Tenant
and their respective heirs, executors, administrators, personal
representatives, successors and permitted assigns until January
30, 2033 or upon the sale of the entire Premises in accordance
with the terms hereof and proper disbursement of the proceeds
thereof, whichever shall first occur. Unless specifically
identified as a personal contract right or obligation herein,
this agreement shall run with any interest in the Premises and
with the title thereto. Once any person, party or entity has
ceased to have an interest in fee in any portion of the Premises,
it shall not be bound by, subject to or benefit from the terms
hereof; but its heirs, executors, administrators, personal
representatives, successors or assigns, as the case may be, shall
be substituted for it hereunder.
8. Any notice or election required or permitted to be given or
served by any party hereto to, or upon any other, shall be given
to all known Co-Tenants and deemed given or served in accordance
with the provisions of this Agreement, if said notice or
elections addressed as follows;
Co-Tenant Initial: /s/ CRW
Co-Tenancy Agreement for Hollywood Video, Saraland, AL
If to Fund XXII:
AEI Income and Growth Fund XXII Limited Partnership
1300 Minnesota World Trade Center
30 E. Seventh Street
St. Paul, Minnesota 55101
If to Whittington:
Carl R. Whittington, Trustee
1440 Elm Grove Avenue
Akron, OH 44312
Each mailed notice or election shall be deemed to have been given
to, or served upon, the party to which addressed on the date the
same is deposited in the United States certified mail, return
receipt requested, postage prepaid, or given to a nationally
recognized courier service guaranteeing overnight delivery as
properly addressed in the manner above provided. Any party hereto
may change its address for the service of notice hereunder by
delivering written notice of said change to the other parties
hereunder, in the manner above specified, at least ten (10) days
prior to the effective date of said change.
9. This Agreement shall not create any partnership or joint
venture among or between the Co-Tenants or any of them, and the
only relationship among and between the Co-Tenants hereunder
shall be that of owners of the premises as tenants in common
subject to the terms hereof.
10. The unenforceability or invalidity of any provision or
provisions of this Agreement as to any person or circumstances
shall not render that provision, nor any other provision hereof,
unenforceable or invalid as to any other person or circumstances,
and all provisions hereof, in all other respects, shall remain
valid and enforceable.
11. In the event any litigation arises between the parties
hereto relating to this Agreement, or any of the provisions
hereof, the party prevailing in such action shall be entitled to
receive from the losing party, in addition to all other relief,
remedies and damages to which it is otherwise entitled, all
reasonable costs and expenses, including reasonable attorneys'
fees, incurred by the prevailing party in connection with said
litigation.
REST OF PAGE INTENTIONALLY LEFT BLANK
Co-Tenant Initial: /s/ CRW
Co-Tenancy Agreement for Hollywood Video, Saraland, AL
IN WITNESS WHEREOF, The parties hereto have caused this Agreement
to be executed and delivered, as of the day and year first above
written.
Whittington: Carl R. Whittington, Trustee of the Carl R.
Whittington Trust dated October 16, 1996
By:/s/ Carl R Whittington Trustee
Carl R. Whittington, Trustee
STATE OF OHIO)
) ss
COUNTY OF Summit)
I, a Notary Public in and for the state and county of aforesaid,
hereby certify there appeared before me this 27th day of March,
2000, Carl R. Whittington, Trustee of the Carl R. Whittington
Trust dated October 16, 1996 who executed the foregoing
instrument in said capacity.
/s/ Marilyn Dodson
Notary Public
[notary seal]
Co-Tenant Initial: /s/ CRW
Co-Tenancy Agreement for Hollywood Video, Saraland, AL
Fund XXII: AEI Income & Growth Fund XXII Limited Partnership
By: AEI Fund Management XXI, Inc., its corporate general
partner
By:/s/ Robert P Johnson
Robert P. Johnson, President
State of Minnesota )
) ss.
County of Ramsey )
I, a Notary Public in and for the state and county of aforesaid,
hereby certify there appeared before me this 28th day of March,
2000, Robert P. Johnson, President of AEI Fund Management XXI,
Inc., corporate general partner of AEI Income & Growth Fund XXII
Limited Partnership, who executed the foregoing instrument in
said capacity and on behalf of the corporation in its capacity as
corporate general partner, on behalf of said limited partnership.
/s/ Barbara J Kochevar
Notary Public
[notary seal]
Co-Tenant Initial: /s/ CRW
Co-Tenancy Agreement for Hollywood Video, Saraland, AL
EXHIBIT A
Lot 1, WAL*MART SQUARE, according to the plat thereof recorded in
Map Book 70, Page 25 of the probate Court Records of Mobile
County, Alabama.
PROPERTY CO-TENANCY
OWNERSHIP AGREEMENT
(Children's World - DePere, WI)
THIS CO-TENANCY AGREEMENT,
Made and entered into as of the 30th day of March, 2000, by and
between Carl R. Whittington, Trustee of the Carl R. Whittington
Trust dated October 16, 1996 (hereinafter called "Whittington")
and AEI Income & Growth Fund XXII Limited Partnership
(hereinafter called "Fund XXII") (Whittington, Fund XXII (and any
other Owner in Fee where the context so indicates) being
hereinafter sometimes collectively called "Co-Tenants" and
referred to in the neuter gender).
WITNESSETH:
WHEREAS, Fund XXII presently owns an undivided 51.2537% interest
in and to, and Whittington presently owns an undivided 14.8036%
interest in and to, George M. Kunitake and Kay H. Kunitake,
husband and wife as joint tenants, and Steven T. Kunitake, a
married man as his sole and separate property, all as joint
tenants presently own an undivided 16.7323% interest in and to,
and D & R Family Limited Partnership presently owns an undivided
17.2104% in and to the land situated in the City of DePere,
County of Brown and State of WI, (legally described upon Exhibit
A attached hereto and hereby made a part hereof) and in and to
the improvements located thereon (hereinafter called "Premises");
WHEREAS, The parties hereto wish to provide for the orderly
operation and management of the Premises and Whittington's
interest by Fund XXII; the continued leasing of space within the
Premises; for the distribution of income from and the pro-rata
sharing in expenses of the Premises.
NOW THEREFORE, in consideration of the purchase by Whittington of
an undivided interest in and to the Premises, for at least One
Dollar ($1.00) and other good and valuable consideration by the
parties hereto to one another in hand paid, the receipt and
sufficiency of which are hereby acknowledged, and of the mutual
covenants and agreements herein contained, it is hereby agreed by
and between the parties hereto, as follows:
1. The operation and management of the Premises shall be
delegated to Fund XXII, or its designated agent, successors or
assigns. Provided, however, if Fund XXII shall sell all of its
interest in the Premises, the duties and obligations of Fund XXII
respecting management of the Premises as set forth herein,
including but not limited to paragraphs 2, 3, and 4 hereof, shall
be exercised by the holder or holders of a majority undivided co-
tenancy interest in the Premises. Except as hereinafter expressly
provided to the contrary, each of the parties hereto agrees to be
bound by the decisions of Fund XXII with respect to all
administrative, operational and management matters of the
property comprising the Premises, including but not limited to
the management of the net lease agreement for the Premises. The
parties hereto hereby designate Fund XXII as their sole and
exclusive agent to deal with, and Fund XXII retains the sole
right to deal with, any property agent or tenant and to monitor,
execute and enforce the terms of leases of
Co-Tenant Initial: /s/ CRW
Co-Tenancy Agreement for Children's World, DePere, WI
space within the Premises, including but not limited to any
amendments, consents to assignment, sublet, releases or
modifications to leases or guarantees of lease or easements
affecting the Premises, on behalf of Whittington. As long as
Fund XXII owns an interest in the Premises, only Fund XXII may
obligate Whittington with respect to any expense for the
Premises.
As further set forth in paragraph 2 hereof, Fund XXII agrees to
require any lessee of the Premises to name Whittington as an
insured or additional insured in all insurance policies provided
for, or contemplated by, any lease on the Premises. Fund XXII
shall use its best efforts to obtain endorsements adding Co-
Tenants to said policies from lessee within 30 days of
commencement of this agreement. In any event, Fund XXII shall
distribute any insurance proceeds it may receive, to the extent
consistent with any lease on the Premises, to the Co-Tenants in
proportion to their respective ownership of the Premises.
2. Income and expenses shall be allocated among the Co-Tenants
in proportion to their respective share(s) of ownership. Shares
of net income shall be pro-rated for any partial calendar years
included within the term of this Agreement. Fund XXII may offset
against, pay to itself and deduct from any payment due to
Whittington under this Agreement, and may pay to itself the
amount of Whittington's share of any legitimate expenses of the
Premises which are not paid by Whittington to Fund XXII or its
assigns, within ten (10) days after demand by Fund XXII. In the
event there is insufficient operating income from which to deduct
Whittington's unpaid share of operating expenses, Fund XXII may
pursue any and all legal remedies for collection.
Operating Expenses shall include all normal operating expense,
including but not limited to: maintenance, utilities, supplies,
labor, management, advertising and promotional expenses, salaries
and wages of rental and management personnel, leasing commissions
to third parties, a monthly accrual to pay insurance premiums,
real estate taxes, installments of special assessments and for
structural repairs and replacements, management fees, legal fees
and accounting fees, but excluding all operating expenses paid by
Tenant under terms of any lease agreement of the Premises.
Whittington has no requirement to, but has, nonetheless elected
to retain, and agrees to annually reimburse, Fund XXII in the
amount of $550 for the expenses, direct and indirect,
incurred by Fund XXII in providing Whittington with
quarterly accounting and distributions of Whittington's
share of net income and for tracking, reporting and assessing the
calculation of Whittington's share of operating expenses incurred
from the Premises. This invoice amount shall be pro-rated for
partial years and Whittington authorizes Fund XXII to deduct such
amount from Whittington 's share of revenue from the Premises.
Whittington may terminate this agreement in this paragraph
respecting accounting and distributions at any time and attempt
to collect its share of rental income directly from the tenant;
however, enforcement of all other provisions of the lease remains
the sole right of Fund XXII pursuant to Section 1 hereof. Fund
XXII may terminate its obligation under this paragraph upon 30
days notice to Whittington prior to the end of each anniversary
hereof, unless agreed in writing to the contrary.
3. Full, accurate and complete books of account shall be kept
in accordance with generally accepted accounting principles at
Fund XXII's principal office, and each Co-Tenant shall have
Co-Tenant Initial: /s/ CRW
Co-Tenancy Agreement for Children's World, DePere, WI
access to such books and may inspect and copy any part thereof
during normal business hours. Within ninety (90) days after
the end of each calendar year during the term hereof, Fund
XXII shall prepare an accurate income statement for the
ownership of the Premises for said calendar year and shall
furnish copies of the same to all Co-Tenants. Quarterly, as
its share, Whittington shall be entitled to receive 14.8036%
of all items of income and expense generated by the Premises.
Upon receipt of said accounting, if the payments received by
each Co-Tenant pursuant to this Paragraph 3 do not equal, in
the aggregate, the amounts which each are entitled to receive
proportional to its share of ownership with respect to said
calendar year pursuant to Paragraph 2 hereof, an appropriate
adjustment shall be made so that each Co-Tenant receives the
amount to which it is entitled.
4. If Net Income from the Premises is less than $0.00 (i.e.,
the Premises operates at a loss), or if capital improvements,
repairs, and/or replacements, for which adequate reserves do not
exist, need to be made to the Premises, the Co-Tenants, upon
receipt of a written request therefor from Fund XXII, shall,
within fifteen (15) business days after receipt of notice, make
payment to Fund XXII sufficient to pay said net operating losses
and to provide necessary operating capital for the premises and
to pay for said capital improvements, repairs and/or
replacements, all in proportion to their undivided interests in
and to the Premises.
5. Co-Tenants may, at any time, sell, finance, or otherwise
create a lien upon their interest in the Premises but only upon
their interest and not upon any part of the interest held, or
owned, by any other Co-Tenant. All Co-Tenants reserve the right
to escrow proceeds from a sale of their interests in the Premises
to obtain tax deferral by the purchase of replacement property.
6. If any Co-Tenant shall be in default with respect to any of
its obligations hereunder, and if said default is not corrected
within thirty (30) days after receipt by said defaulting Co-
Tenant of written notice of said default, or within a reasonable
period if said default does not consist solely of a failure to
pay money, the remaining Co-Tenant(s) may resort to any available
remedy to cure said default at law, in equity, or by statute.
7. This Co-Tenancy Agreement shall continue in full force and
effect and shall bind and inure to the benefit of the Co-Tenant
and their respective heirs, executors, administrators, personal
representatives, successors and permitted assigns until July 14,
2029 or upon the sale of the entire Premises in accordance with
the terms hereof and proper disbursement of the proceeds thereof,
whichever shall first occur. Unless specifically identified as a
personal contract right or obligation herein, this agreement
shall run with any interest in the Property and with the title
thereto. Once any person, party or entity has ceased to have an
interest in fee in any portion of the Entire Property, it shall
not be bound by, subject to or benefit from the terms hereof; but
its heirs, executors, administrators, personal representatives,
successors or assigns, as the case may be, shall be substituted
for it hereunder.
8. Any notice or election required or permitted to be given or
served by any party hereto to, or upon any other, shall be deemed
given or served in accordance with the provisions of this
Agreement, if said notice or elections addressed as follows;
Co-Tenant Initial: /s/ CRW
Co-Tenancy Agreement for Children's World, DePere, WI
If to Fund XXII:
AEI Income & Growth Fund XXII Limited Partnership
1300 Minnesota World Trade Center
30 E. Seventh Street
St. Paul, Minnesota 55101
If to Whittington:
Carl R. Whittington, Trustee
1440 Elm Grove Avenue
Akron, OH 44312
If to Kunitake:
George M. and Kay H. Kunitake
Steven T. Kunitake
153 Exeter
San Carlos, CA 94070
If to D & R:
Robert DeKlotz, Partner
D & R Family Limited Partnership
1760 E. North Hills Drive
LaHabra, CA 90631
Each mailed notice or election shall be deemed to have been given
to, or served upon, the party to which addressed on the date the
same is deposited in the United States certified mail, return
receipt requested, postage prepaid, or given to a nationally
recognized courier service guaranteeing overnight delivery as
properly addressed in the manner above provided. Any party hereto
may change its address for the service of notice hereunder by
delivering written notice of said change to the other parties
hereunder, in the manner above specified, at least ten (10) days
prior to the effective date of said change.
9. This Agreement shall not create any partnership or joint
venture among or between the Co-Tenants or any of them, and the
only relationship among and between the Co-Tenants hereunder
shall be that of owners of the premises as tenants in common
subject to the terms hereof.
10. The unenforceability or invalidity of any provision or
provisions of this Agreement as to any person or circumstances
shall not render that provision, nor any other provision hereof,
Co-Tenant Initial: /s/ CRW
Co-Tenancy Agreement for Children's World, DePere, WI
unenforceable or invalid as to any other person or
circumstances, and all provisions hereof, in all other
respects, shall remain valid and enforceable.
11. In the event any litigation arises between the parties
hereto relating to this Agreement, or any of the provisions
hereof, the party prevailing in such action shall be entitled to
receive from the losing party, in addition to all other relief,
remedies and damages to which it is otherwise entitled, all
reasonable costs and expenses, including reasonable attorneys'
fees, incurred by the prevailing party in connection with said
litigation.
REST OF PAGE INTENTIONNALLY LEFT BLANK
Co-Tenant Initial: /s/ CRW
Co-Tenancy Agreement for Children's World, DePere, WI
IN WITNESS WHEREOF, The parties hereto have caused this Agreement
to be executed and delivered, as of the day and year first above
written.
Whittington: Carl R. Whittington, Trustee of the Carl R.
Whittington Trust dated October 16, 1996
By: /s/ Carl R Whittington Trustee
Carl R. Whittington, Trustee
WITNESS
/s/ Stella Ford
Stella Ford
(Print Name)
State of Ohio)
) ss.
County of Summit)
I, a Notary Public in and for the state and county of aforesaid,
hereby certify there appeared before me this 27 day of March,
2000, Carl R. Whittington, Trustee of the Carl R. Whittington
Trust dated October 16, 1996, who executed the foregoing
instrument in said capacity.
/s/ Marilyn Dodson
Notary Public
[notary seal]
Co-Tenant Initial: /s/ CRW
Co-Tenancy Agreement for Children's World, DePere, WI
Fund XXII: AEI Income & Growth Fund XXII Limited Partnership
By: AEI Fund Management XXI, Inc., its corporate general
partner
By:/s/ Robert P Johnson
Robert P. Johnson, President
WITNESS:
/s/ Jill Rayburn
Jill Rayburn
(Print Name)
State of Minnesota )
) ss.
County of Ramsey )
I, a Notary Public in and for the state and county of aforesaid,
hereby certify there appeared before me this 28th day of March,
2000, Robert P. Johnson, President of AEI Fund Management XXI
Inc., corporate general partner of AEI Income & Growth Fund XXII
Limited Partnership, who executed the foregoing instrument in
said capacity and on behalf of the corporation in its capacity as
corporate general partner, on behalf of said limited partnership.
/s/ Barbara J Kochevar
Notary Public
[notary seal]
Co-Tenant Initial: /s/ CRW
Co-Tenancy Agreement for Children's World, DePere, WI
EXHIBIT "A"
LEGAL DESCRIPTION
All of Lot One (1) of Volumnet 34 Certified Survey
Maps, Page 125, Brown County Records, and is located in
part of Government Lots 1 and 2, Section Thirty-five
(35) and part of Government Lot 1 and part of the
Southeast One-quarter of the Northeast, One-quarter (SE
1/4 - NE 1/4), Section Thirty-four (34), all being in
Township Twenty-three (23) North, Range Twenty (20)
East, in the Town of Ledgeview, Brown County,
Wisconsin.
and
Part of Lot One (1) of Volume 30 Certified Survey
Maps, Page 71, Brown County Records, being part of
Government Lots 1 and 2, Section Thirty-five (35),
Township Twenty-three (23) North, Range Twenty (20)
East, in the Town of Ledgeview, Brown County,
Wisconsin, more fully described as follows:
Commencing at the West 1/4 corner, Section 35,
T23N, R20E; thence N01 36' 23" West, 1763.33 feet along
the West line of said Section 35, to the South right-of-
way of Heritage Road, also known as C.T.H. "X"'; thence
N89 02'44" East, 82.54 feet along said right-of-way to
the point of beginning; thence N89 02'44" East 53.61
feet along said right-of-way; thence 167.98 feet along
said right-of-way, being the arc of a 1095.92 foot
radius curve to the right, whose long chord bears S86
33'48" East, 167.82 feet; thence S1 36' 23" East,
539.93 feet along the East line of Lot 1, Volume 30
Certified Survey Maps, Page 71, Brown County Records,
to the North right-of-way of Swan Road; thence S88 33'
16" West, 220.77 feet along said right-of-way; thence N
1 36' 23" West, 554.67 feet along the East line of Lot
1, Volume 34 Certified Survey Maps, Page 125, Brown
County Records, to the point of beginning.
Tax Parcel No. D-50-1 and D-84-1
Arcadian Lane/Heritage Road
De Pere, WI 54115
PURCHASE AGREEMENT
Marie Callender's - Henderson, NV
This AGREEMENT, entered into effective as of the 13th of April,
2000.
l. PARTIES. Seller is AEI Income & Growth Fund XXII Limited
Partnership which presently owns an undivided 16.4133% interest
in the fee title to that certain real property legally described
in the attached Exhibit "A" (the "Entire Property"). Buyer is
Francis E. Quinn and Cecile Ann Quinn, husband and wife as
survivorship marital property ("Buyer"). Seller wishes to sell
and Buyer wishes to buy a portion as Tenant in Common of Seller's
interest in the Entire Property.
2. PROPERTY. The Property to be sold to Buyer in this transaction
consists of an undivided 10.1238 percentage interest
(hereinafter, simply the "Property") as Tenant in Common in the
Entire Property.
3. PURCHASE PRICE The purchase price for this percentage
interest in the Entire Property is $218,000, all cash.
4. TERMS. The purchase price for the Property will be paid by
Buyer as follows:
(a) When this agreement is executed, Buyer will pay $5,000
to Seller (which shall be deposited into escrow according to
the terms hereof) (the "First Payment"). The First Payment
will be credited against the purchase price when and if
escrow closes and the sale is completed.
(b) Buyer will deposit the balance of the purchase price,
$213,000 (the "Second Payment") into escrow in sufficient
time to allow escrow to close on the closing date.
5. CLOSING DATE. Escrow is anticipated to close on or before
April 30, 2000.
6. DUE DILIGENCE. Buyer will have until the expiration of the
tenth business day (The "Review Period") after delivery of each
of following items, to be supplied by Sellers, to conduct all of
its inspections and due diligence and satisfy itself regarding
each item, the Property, and this transaction. Buyer agrees to
indemnify and hold Sellers harmless for any loss or damage to the
Entire Property or persons caused by Buyer or its agents arising
out of such physical inspections of the Entire Property.
(a) The original and one copy of a title insurance
commitment for an Owner's Title insurance policy (see
paragraph 8 below).
(b) A copy of a Certificate of Occupancy or other such
document certifying completion and granting permission to
permanently occupy the improvements on the Entire Property
as are in Seller's possession.
(c) A copy of an "as built" survey of the Entire Property
done concurrent with Seller's acquisition of the Property.
Buyer Initial: /s/ FQ /s/ CAQ
Purchase Agreement for Marie Callender's - Henderson, NV
(d) Lease (as further set forth in paragraph 11(a) below) of
the Entire Property showing occupancy date, lease expiration
date, rent, and Guarantys, if any, accompanied by such
tenant financial statements as may have been provided most
recently to Seller by the Tenant and/or Guarantors.
It is a contingency upon Seller's obligations hereunder that two
(2) copies of Co-Tenancy Agreement in the form attached hereto
duly executed by Buyer and AEI Real Estate Fund XIX Limited
Partnership and dated on escrow closing date be delivered to the
Seller on the closing date.
Buyer may cancel this agreement for ANY REASON in its sole
discretion by delivering a cancellation notice, return receipt
requested, to Seller and escrow holder before the expiration of
the Review Period. Such notice shall be deemed effective only
upon receipt by Seller. If this Agreement is not cancelled as
set forth above, the First Payment shall be non-refundable unless
Seller shall default hereunder.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under the first paragraph of section 6 of this
agreement (which will survive), Buyer (after execution of such
documents reasonably requested by Seller to evidence the
termination hereof) shall be returned its First Payment, and
Buyer will have absolutely no rights, claims or interest of any
type in connection with the Property or this transaction,
regardless of any alleged conduct by Sellers or anyone else.
Unless this Agreement is canceled by Buyer pursuant to the
terms hereof, if Buyer fails to make the Second Payment, Seller
shall be entitled to retain the First Payment and Buyer
irrevocably will be deemed to be in default under this Agreement.
Seller may, at its option, retain the First Payment and declare
this Agreement null and void, in which event Buyer will be deemed
to have canceled this Agreement and relinquish all rights in and
to the Property or Sellers may exercise its rights under Section
14 hereof. If this Agreement is not canceled and the Second
Payment is made when required, all of Buyer's conditions and
contingencies will be deemed satisfied.
7. ESCROW. Escrow shall be opened by Seller and funds deposited
in escrow upon acceptance of this Agreement by both parties. The
escrow holder will be a nationally-recognized escrow company
selected by Seller. A copy of this Agreement will be delivered to
the escrow holder and will serve as escrow instructions together
with the escrow holder's standard instructions and any additional
instructions required by the escrow holder to clarify its rights
and duties (and the parties agree to sign these additional
instructions). If there is any conflict between these other
instructions and this Agreement, this Agreement will control.
8. TITLE. Closing will be conditioned on the agreement of a
title company selected by Seller to issue an Owner's policy of
title insurance, dated as of the close of escrow, in an amount
equal to the purchase price, insuring that Buyer will own
insurable title to the Property subject only to: the title
company's standard exceptions; current real property taxes and
assessments; survey exceptions; the rights of parties in
possession pursuant to the lease defined in paragraph 11 below;
and other items of record as shown in the title commitment.
Buyer Initial: /s/ FQ /s/ CAQ
Purchase Agreement for Marie Callender's - Henderson, NV
Buyer shall be allowed five (5) days after receipt of said
commitment for examination and the making of any objections to
marketability thereto, said objections to be made in writing or
deemed waived. If any objections are so made, the Seller shall
be allowed eighty (80) days to make such title marketable or in
the alternative to obtain a commitment for insurable title
insuring over Buyer's objections. If Sellers shall decide to
make no efforts to make title marketable, or is unable to make
title marketable or obtain insurable title, (after execution by
Buyer of such documents reasonably requested by Seller to
evidence the termination hereof) Buyer's First Payment shall be
returned and this Agreement shall be null and void and of no
further force and effect. Seller has no obligation to spend any
funds or make any effort to satisfy Buyer's objections, if any.
Pending satisfaction of Buyer's objections, the payments
hereunder required shall be postponed, but upon satisfaction of
Buyer's objections and within ten (10) days after written notice
of satisfaction of Buyer's objections to the Buyer, the parties
shall perform this Agreement according to its terms.
9. CLOSING COSTS. Seller will pay one-half of escrow fees, the
cost of the title commitment and any brokerage commissions
payable. The Buyer will pay the cost of issuing a Standard
Owners Title Insurance Policy in the full amount of the purchase
price, if Buyer shall decide to purchase the same. Buyer will
pay all recording fees, one-half of the escrow fees, and the cost
of an update to the Survey in Seller possession (if an update is
required by Buyer.) Each party will pay its own attorney's fees
and costs to document and close this transaction.
10. REAL ESTATE TAXES, SPECIAL ASSESSMENTS AND PRORATIONS.
(a) Because the Entire Property (of which the Property is a
part) is subject to a triple net lease (as further set forth
in paragraph 11(a)(i), the parties acknowledge that there
shall be no need for a real estate tax proration. However,
Seller represents that to the best of its knowledge, all
real estate taxes and installments of special assessments
due and payable in all years prior to the year of Closing
have been paid in full. Unpaid real estate taxes and unpaid
levied and pending special assessments existing on the date
of Closing shall be the responsibility of Buyer and Seller
in proportion to their respective Tenant in Common
interests, pro-rated, however, to the date of closing for
the period prior to closing, which shall be the
responsibility of Seller if Tenant shall not pay the same.
Seller and Buyer shall likewise pay all taxes due and
payable in the year after Closing and any unpaid
installments of special assessments payable therewith and
thereafter, if such unpaid levied and pending special
assessments and real estate taxes are not paid by any tenant
of the Entire Property.
(b) All income and all operating expenses from the Entire
Property shall be prorated between the parties and adjusted
by them as of the date of Closing. Seller shall be entitled
to all income earned and shall be responsible for all
expenses incurred prior to the date of Closing, and Buyer
shall be entitled to its proportionate share of all income
earned and shall be responsible for its proportionate share
of all operating expenses of the Entire Property incurred on
and after the date of closing.
Buyer Initial: /s/ FQ /s/ CAQ
Purchase Agreement for Marie Callender's - Henderson, NV
11. SELLER'S REPRESENTATION AND AGREEMENTS.
(a) Seller represents and warrants as of this date that:
(i) Except for the Lease Agreement in existence between AEI
Net Lease Income & Growth Fund XIX Limited Partnership, AEI
Income & Growth Fund XXII Limited Partnership (as
"Landlord") and Marie Callender Pie Shops Inc.("Tenant"),
dated September 27, 1999, Seller is not aware of any leases
of the Property. The above referenced lease agreement has a
right of first refusal in favor of the Tenant as set forth
in Article 34 of said lease agreement, which right will
apply to any attempted disposition of Property by Buyer
after this transaction.
(ii) It is not aware of any pending litigation or
condemnation proceedings against the Property or Seller's
interest in the Property.
(iii) Except as previously disclosed to Buyer and as
permitted in paragraph (b) below, Seller is not aware of any
contracts Seller has executed that would be binding on Buyer
after the closing date.
(b) Provided that Buyer performs its obligations when
required, Seller agrees that it will not enter into any new
contracts that would materially affect the Property and be
binding on Buyer after the Closing Date without Buyer's
prior consent, which will not be unreasonably withheld.
However, Buyer acknowledges that Seller retains the right
both prior to and after the Closing Date to freely transfer
all or a portion of Seller's remaining undivided interest in
the Entire Property, provided such sale shall not encumber
the Property being purchased by Buyer in violation of the
terms hereof or the contemplated Co-Tenancy Agreement.
12. DISCLOSURES.
(a) Seller has not received any notice of any material,
physical, or mechanical defects of the Entire Property,
including without limitation, the plumbing, heating, air
conditioning, ventilating, electrical system. To the best of
Seller's knowledge without inquiry, all such items are in
good operating condition and repair and in compliance with
all applicable governmental, zoning, and land use laws,
ordinances, regulations and requirements. If Seller shall
receive any notice to the contrary prior to Closing, Seller
will inform Buyer prior to Closing.
(b) Seller has not received any notice that the use and
operation of the Entire Property is not in full compliance
with applicable building codes, safety, fire, zoning, and
land use laws, and other applicable local, state and federal
laws, ordinances, regulations and requirements. If Seller
shall receive any notice to the contrary prior to Closing,
Seller will inform Buyer prior to Closing.
(c) Seller knows of no facts nor has Seller failed to disclose
to Buyer any fact known to Seller which would prevent the Tenant
from using and operating the Entire Property after the Closing in
the manner in which the Entire Property has been used and
operated
Buyer Initial: /s/ FQ /s/ CAQ
Purchase Agreement for Marie Callender's - Henderson, NV
prior to the date of this Agreement. If Seller shall
receive any notice to the contrary prior to Closing, Seller
will inform Buyer prior to Closing.
(d) Seller has not received any notice that the Entire
Property is in violation of any federal, state or local law,
ordinance, or regulations relating to industrial hygiene or
the environmental conditions on, under, or about the Entire
Property, including, but not limited to, soil, and
groundwater conditions. To the best of Seller's knowledge,
there is no proceeding or inquiry by any governmental
authority with respect to the presence of Hazardous
Materials on the Entire Property or the migration of
Hazardous Materials from or to other property. Buyer agrees
that Seller will have no liability of any type to Buyer or
Buyer's successors, assigns, or affiliates in connection
with any Hazardous Materials on or in connection with the
Entire Property after the Closing Date. Seller shall
indemnify Buyer for any liability arising due to Hazardous
Materials on or in connection with the Entire Property prior
to the Closing Date. If Seller shall receive any notice to
the contrary prior to Closing, Seller will inform Buyer
prior to Closing.
(e) BUYER AGREES THAT IT SHALL BE PURCHASING THE PROPERTY
IN ITS THEN PRESENT CONDITION, AS IS, WHERE IS, AND SELLER
HAS NO OBLIGATIONS TO CONSTRUCT OR REPAIR ANY IMPROVEMENTS
THEREON OR TO PERFORM ANY OTHER ACT REGARDING THE PROPERTY,
EXCEPT AS EXPRESSLY PROVIDED HEREIN.
(f) BUYER ACKNOWLEDGES THAT, HAVING BEEN GIVEN THE
OPPORTUNITY TO INSPECT THE ENTIRE PROPERTY AND SUCH
FINANCIAL INFORMATION ON THE LESSEE AND GUARANTORS OF THE
LEASE AS BUYER OR ITS ADVISORS SHALL REQUEST, IF IN SELLER'S
POSSESSION, BUYER IS RELYING SOLELY ON ITS OWN INVESTIGATION
OF THE PROPERTY AND NOT ON ANY INFORMATION PROVIDED BY
SELLER OR TO BE PROVIDED EXCEPT AS SET FORTH HEREIN. BUYER
FURTHER ACKNOWLEDGES THAT THE INFORMATION PROVIDED AND TO BE
PROVIDED BY SELLER WITH RESPECT TO THE PROPERTY, THE ENTIRE
PROPERTY AND TO THE LESSEE AND GUARANTORS OF LEASE WAS
OBTAINED FROM A VARIETY OF SOURCES AND SELLER NEITHER (A)
HAS MADE INDEPENDENT INVESTIGATION OR VERIFICATION OF SUCH
INFORMATION, OR (B) MAKES ANY REPRESENTATIONS AS TO THE
ACCURACY OR COMPLETENESS OF SUCH INFORMATION EXCEPT AS
HEREIN SET FORTH. THE SALE OF THE PROPERTY AS PROVIDED FOR
HEREIN IS MADE ON AN "AS IS" BASIS, AND BUYER EXPRESSLY
ACKNOWLEDGES THAT, IN CONSIDERATION OF THE AGREEMENTS OF
SELLER HEREIN, EXCEPT AS OTHERWISE SPECIFIED HEREIN IN
PARAGRAPH 11(A) AND (B) ABOVE AND THIS PARAGRAPH 12, SELLER
MAKES NO WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, OR
ARISING BY OPERATION OF LAW, INCLUDING, BUT NOT LIMITED TO,
ANY WARRANTY OF CONDITION, HABITABILITY, TENANTABILITY,
SUITABILITY FOR COMMERCIAL PURPOSES, MERCHANTABILITY, OR
FITNESS FOR A PARTICULAR PURPOSE, IN RESPECT OF THE
PROPERTY.
The provisions (d) - (f) above shall survive Closing.
13. CLOSING.
(a) Before the closing date, Seller will deposit into escrow an
executed special warranty deed warranting title against lawful
claims by, through, or under a conveyance
Buyer Initial: /s/ FQ /s/ CAQ
Purchase Agreement for Marie Callender's - Henderson, NV
from Seller, but not further or otherwise, conveying
insurable title of the Property to Buyer, subject to the
exceptions contained in paragraph 8 above.
(b) On or before the closing date, Buyer will deposit into
escrow: the balance of the purchase price when required
under Section 4; any additional funds required of Buyer,
(pursuant to this agreement or any other agreement executed
by Buyer) to close escrow. Both parties will sign and
deliver to the escrow holder any other documents reasonably
required by the escrow holder to close escrow.
(c) On the closing date, if escrow is in a position to
close, the escrow holder will: record the deed in the
official records of the county where the Property is
located; cause the title company to commit to issue the
title policy; immediately deliver to Seller the portion of
the purchase price deposited into escrow by cashier's check
or wire transfer (less debits and prorations, if any);
deliver to Seller and Buyer a signed counterpart of the
escrow holder's certified closing statement and take all
other actions necessary to close escrow.
14. DEFAULTS. If Buyer defaults, Buyer will forfeit all rights
and claims and Seller will be relieved of all obligations and
will be entitled to retain all monies heretofore paid by the
Buyer. In addition, Seller shall retain all remedies available
to Seller at law or in equity.
If Seller shall default, Buyer irrevocably waives any rights
to file a lis pendens, a specific performance action or any other
claim, action or proceeding of any type in connection with the
Property or this or any other transaction involving the Property,
and will not do anything to affect title to the Property or
hinder, delay or prevent any other sale, lease or other
transaction involving the Property (any and all of which will be
null and void), unless: it has paid the First Payment, deposited
the balance of the Second Payment for the purchase price into
escrow, performed all of its other obligations and satisfied all
conditions under this Agreement, and unconditionally notified
Seller that it stands ready to tender full performance, purchase
the Property and close escrow as per this Agreement, regardless
of any alleged default or misconduct by Seller. Provided,
however, that in no event shall Seller be liable for any
punitive, consequential or speculative damages arising out of any
default by Seller hereunder.
15. BUYER'S REPRESENTATIONS AND WARRANTIES.
a. Buyer represents and warrants to Seller as follows:
(i) In addition to the acts and deeds recited herein and
contemplated to be performed, executed, and delivered by
Buyer, Buyer shall perform, execute and deliver or cause to
be performed, executed, and delivered at the Closing or
after the Closing, any and all further acts, deeds and
assurances as Seller or the Title Company may require and be
reasonable in order to consummate the transactions
contemplated herein.
(ii) Buyer has all requisite power and authority to consummate
the transaction contemplated by this Agreement and has by
proper proceedings duly authorized the
Buyer Initial: /s/ FQ /s/ CAQ
Purchase Agreement for Marie Callender's - Henderson, NV
execution and delivery of this Agreement and the
consummation of the transaction contemplated hereby.
(iii) To Buyer's knowledge, neither the execution and
delivery of this Agreement nor the consummation of the
transaction contemplated hereby will violate or be in
conflict with (a) any applicable provisions of law, (b) any
order of any court or other agency of government having
jurisdiction hereof, or (c) any agreement or instrument to
which Buyer is a party or by which Buyer is bound.
16. DAMAGES, DESTRUCTION AND EMINENT DOMAIN.
(a) If, prior to closing, the Property or any part thereof
is destroyed or further damaged by fire, the elements, or
any cause, due to events occurring subsequent to the date of
this Agreement to the extent that the cost of repair exceeds
$10,000.00, this Agreement shall become null and void, at
Buyer's option exercised, if at all, by written notice to
Seller within ten (10) days after Buyer has received written
notice from Seller of said destruction or damage. Seller,
however, shall have the right to adjust or settle any
insured loss until (i) all contingencies set forth in
Paragraph 6 hereof have been satisfied, or waived; and (ii)
any ten-day period provided for above in this Subparagraph
16a for Buyer to elect to terminate this Agreement has
expired or Buyer has, by written notice to Seller, waived
Buyer's right to terminate this Agreement. If Buyer elects
to proceed and to consummate the purchase despite said
damage or destruction, there shall be no reduction in or
abatement of the purchase price, and Seller shall assign to
Buyer the Seller's right, title, and interest in and to all
insurance proceeds (pro-rata in relation to the Entire
Property) resulting from said damage or destruction to the
extent that the same are payable with respect to damage to
the Property, subject to rights of any Tenant of the Entire
Property.
If the cost of repair is less than $10,000.00, Buyer shall
be obligated to otherwise perform hereinunder with no
adjustment to the Purchase Price, reduction or abatement,
and Seller shall assign Seller's right, title and interest
in and to all insurance proceeds pro-rata in relation to the
Entire Property, subject to rights of any Tenant of the
Entire Property.
(b) If, prior to closing, the Property, or any part
thereof, is taken by eminent domain, this Agreement shall
become null and void, at Buyer's option. If Buyer elects to
proceed and to consummate the purchase despite said taking,
there shall be no reduction in, or abatement of, the
purchase price, and Seller shall assign to Buyer the
Seller's right, title, and interest in and to any award
made, or to be made, in the condemnation proceeding pro-rata
in relation to the Entire Property, subject to rights of any
Tenant of the Entire Property.
In the event that this Agreement is terminated by Buyer as
provided above in Subparagraph 16a or 16b, the First Payment
shall be immediately returned to Buyer (after execution by Buyer
of such documents reasonably requested by Seller to evidence the
termination hereof).
Buyer Initial: /s/ FQ /s/ CAQ
Purchase Agreement for Marie Callender's - Henderson, NV
17. BUYER'S 1031 TAX FREE EXCHANGE.
While Seller acknowledges that Buyer is purchasing the
Property as "replacement property" to accomplish a tax free
exchange, Buyer acknowledges that Seller has made no
representations, warranties, or agreements to Buyer or Buyer's
agents that the transaction contemplated by the Agreement will
qualify for such tax treatment, nor has there been any reliance
thereon by Buyer respecting the legal or tax implications of the
transactions contemplated hereby. Buyer further represents that
it has sought and obtained such third party advice and counsel as
it deems necessary in regards to the tax implications of this
transaction.
Buyer wishes to novate/assign the ownership rights and
interest of this Purchase Agreement to Bay Title & Abstract,
Inc., which will act as Accommodator to perfect the 1031 exchange
by preparing an agreement of exchange of Real Property whereby
Bay Title & Abstract, Inc., will be an independent third party
purchasing the ownership interest in subject property from Seller
and selling the ownership interest in subject property to Buyer
under the same terms and conditions as documented in this
Purchase Agreement. Seller consents to such assignments. Buyer
asks the Seller, and Seller agrees to cooperate in the perfection
of such an exchange if at no additional cost or expense to Seller
or delay in time. Buyer hereby indemnifies and holds Seller
harmless from any claims and/or actions resulting from said
exchange. Pursuant to the direction of Bay Title & Abstract,
Inc., Seller will deed the Property directly to Buyer.
18. CANCELLATION
If any party elects to cancel this Contract because of any
breach by another party or because escrow fails to close by
the agreed date, the party electing to cancel shall deliver
to escrow agent a notice containing the address of the party
in breach and stating that this Contract shall be cancelled
unless the breach is cured within 10 days following the
delivery of the notice to the escrow agent. Within three
days after receipt of such notice, the escrow agent shall
send it by United States Mail to the party in breach at the
address contained in the Notice and no further notice shall
be required. If the breach is not cured within the 10 days
following the delivery of the notice to the escrow agent,
this Contract shall be cancelled.
19. MISCELLANEOUS.
(a) This Agreement may be amended only by written agreement
signed by both Seller and Buyer, and all waivers must be in
writing and signed by the waiving party. Time is of the
essence. This Agreement will not be construed for or
against a party whether or not that party has drafted this
Agreement. If there is any action or proceeding between the
parties relating to this Agreement the prevailing party will
be entitled to recover attorney's fees and costs. This is
an integrated agreement containing all agreements of the
parties about the Property and the other matters described,
and it supersedes any other agreements or understandings.
Exhibits attached to this Agreement are incorporated into
this Agreement.
Buyer Initial: /s/ FQ /s/ CAQ
Purchase Agreement for Marie Callender's - Henderson, NV
(b) If this escrow has not closed by April 30, 2000,
through no fault of Seller, Seller may either, at its
election, extend the closing date or exercise any remedy
available to it by law, including terminating this
Agreement.
(c) Funds to be deposited or paid by Buyer must be good and
clear funds in the form of cash, cashier's checks or wire
transfers.
(d) All notices from either of the parties hereto to the
other shall be in writing and shall be considered to have
been duly given or served if sent by first class certified
mail, return receipt requested, postage prepaid, or by a
nationally recognized courier service guaranteeing overnight
delivery to the party at his or its address set forth below,
or to such other address as such party may hereafter
designate by written notice to the other party.
If to Seller:
Attention: Robert P. Johnson
AEI Income & Growth Fund XXII Limited Partnership
1300 Minnesota World Trade Center
30 E. 7th Street
St. Paul, MN 55101
If to Buyer:
Francis E. and Cecile Ann Quinn
510 West 4th Street
Shawano, WI 54166
When accepted, this offer will be a binding agreement for
valid and sufficient consideration which will bind and benefit
Buyer, Seller and their respective successors and assigns. Buyer
is submitting this offer by signing a copy of this offer and
delivering it to Seller. Seller has five (5) business days from
receipt within which to accept this offer.
REST OF PAGE INTENTIONALLY LEFT BLANK.
Buyer Initial: /s/ FQ /s/ CAQ
Purchase Agreement for Marie Callender's - Henderson, NV
IN WITNESS WHEREOF, the Seller and Buyer have executed this
Agreement effective as of the day and year above first written.
BUYER: Francis E. Quinn and Cecile Ann Quinn, husband and
wife as survivorship marital property.
By:/s/ Francis E Quinn 4/13/2000
Francis E. Quinn
By:/s/ Cecile Ann Quinn 4-13-2000
Cecile Ann Quinn
SELLER: AEI Income & Growth Fund XXII Limited Partnership
By: AEI Fund Management XXI, Inc., its corporate
general partner
By:/s/ Robert P Johnson
Robert P. Johnson, President
Buyer Initial: /s/ FQ /s/ CAQ
Purchase Agreement for Marie Callender's - Henderson, NV
EXHIBIT "A"
LEGAL DESCRIPTION
(Henderson, Nevada)
Being a division of Lot One (1) as shown upon the FINAL MAP
OF GALLERIA COMMONS ( a commercial subdivision) as depicted
in Book 79, Page 48 of Plats, Official Records, Clark
County, Nevada, also being a portion of the West Half (W
1/2) of the Southwest Quarter (SW 1/4) of Section 3,
Township 22 South, Range 62 East, M.D.M., City of Henderson,
Clark County, Nevada, more particularly described as
follows:
Commencing at the West Quarter Corner (w 1/4 Cor.) of said
Section 3, said corner being common to Sections 3 and 4;
Thence South 00 14' 06" West along the West line of said
Section 3, a distance of 808.13 feet;
Thence North 88 55' 32" East, a distance of 50.01 fee to a
point on the Easterly right of way line of Stephanie Street'
Thence south 00 14' 06" West along said Easterly right of
way line, a distance of 585.62 feet;
Thence South 89 45' 54" East, a distance of 20.00 feet to
the Point of Beginning;
Thence North 88 51' 28" East, a distance of 147.22 feet;
Thence South 01 05' 43" East, a distance of 108.33 feet;
Thence South 88 51' 28" West, a distance of 2.92 feet;
Thence South 89 56' 32" West, a distance of 149.41 feet;
Thence North 00 14' 06" East, a distance of 284.89 feet to
the POINT OF BEGINNING
PURCHASE AGREEMENT
Hollywood Video - Saraland, AL
This AGREEMENT, entered into effective as of the 18th of April,
2000.
l. PARTIES. Seller is AEI Income & Growth Fund XXII Limited
Partnership which owns an undivided 87.4708% interest in the fee
title to that certain real property legally described in the
attached Exhibit "A" (the "Entire Property") Buyer is Wuest
Estate Company, A California Corporation ("Buyer"). Seller wishes
to sell and Buyer wishes to buy a portion of Seller's tenant in
common interest in the Entire Property.
2. PROPERTY. The Property to be sold to Buyer in this transaction
consists of an undivided 12.5832 percentage interest
(hereinafter, simply the "Property") as Tenant in Common in the
Entire Property.
3. PURCHASE PRICE. The purchase price for this percentage
interest in the Entire Property is $233,000, all cash.
4. TERMS. The purchase price for the Property will be paid by
Buyer as follows:
(a) When this agreement is executed, Buyer will pay $5,000
to Seller (which shall be deposited into escrow according to
the terms hereof) (the "First Payment"). The First Payment
will be credited against the purchase price when and if
escrow closes and the sale is completed.
(b) Buyer will deposit the balance of the purchase price,
$228,000 (the "Second Payment") into escrow in sufficient
time to allow escrow to close on the closing date.
5. CLOSING DATE. Escrow shall close on or before April 30, 2000.
6. DUE DILIGENCE. Buyer will have until the expiration of the
tenth business day (The "Review Period") after delivery of all
four of the following items, to be supplied by Seller, to conduct
all of its inspections and due diligence and satisfy itself
regarding each item, the Property, and this transaction. Buyer
agrees to indemnify and hold Seller harmless for any loss or
damage to the Entire Property or persons caused by Buyer or its
agents arising out of such physical inspections of the Entire
Property.
(a) The original and one copy of a title insurance
commitment for an Owner's Title insurance policy (see
paragraph 8 below).
(b) A copy of a Certificate of Occupancy or other such
document certifying completion and granting permission to
permanently occupy the improvements on the Entire Property
as are in Seller's possession.
(c) A copy of an "as built" survey of the Entire Property
done concurrent with Seller's acquisition of the Property.
Buyer Initial: /s/ TGM /s/ STM
Purchase Agreement for Hollywood Video, Saraland, AL
(d) Lease (as further set forth in paragraph 11(a) below) of
the Entire Property showing occupancy date, lease expiration
date, rent, and Guarantys, if any, accompanied by such
tenant financial statements as may have been provided most
recently to Seller by the Tenant and/or Guarantors.
It is a contingency upon Seller's obligations hereunder that
two (2) copies of Co-Tenancy Agreement in the form attached
hereto duly executed by Buyer and Seller and dated on escrow
closing date be delivered to the Seller on the closing date.
Buyer may cancel this agreement for ANY REASON in its sole
discretion by delivering a cancellation notice, via first class
mail, return receipt requested, to Seller and escrow holder
before the expiration of the Review Period. Such notice shall be
deemed effective only upon receipt by Seller. If this Agreement
is not cancelled as set forth above, the First Payment shall be
non-refundable unless Seller shall default hereunder.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under the first paragraph of sections 6 of this
agreement (which will survive), Buyer (after execution of such
documents reasonably requested by Seller to evidence the
termination hereof) shall be returned its First Payment, and
Buyer will have absolutely no rights, claims or interest of any
type in connection with the Property or this transaction,
regardless of any alleged conduct by Seller or anyone else.
Unless this Agreement is canceled by Buyer pursuant to the
terms hereof, if Buyer fails to make the Second Payment, Seller
shall be entitled to retain the First Payment and Buyer
irrevocably will be deemed to be in default under this Agreement.
Seller may, at its option, retain the First Payment and declare
this Agreement null and void, in which event Buyer will be deemed
to have canceled this Agreement and relinquish all rights in and
to the Property or Seller may exercise its rights under Section
14 hereof. If this Agreement is not canceled and the Second
Payment is made when required, all of Buyer's conditions and
contingencies will be deemed satisfied.
7. ESCROW. Escrow shall be opened by Seller and funds deposited
in escrow upon acceptance of this agreement by both parties. The
escrow holder will be a nationally-recognized escrow company
selected by Seller. A copy of this Agreement will be delivered to
the escrow holder and will serve as escrow instructions together
with the escrow holder's standard instructions and any additional
instructions required by the escrow holder to clarify its rights
and duties (and the parties agree to sign these additional
instructions). If there is any conflict between these other
instructions and this Agreement, this Agreement will control.
8. TITLE. Closing will be conditioned on the commitment of a
title company selected by Seller to issue an Owner's policy of
title insurance, dated as of the close of escrow, in an amount
equal to the purchase price, insuring that Buyer will own
insurable title to the Property subject only to: the title
company's standard exceptions; current real property taxes and
assessments; survey exceptions; the rights of parties in
possession pursuant to the lease defined in paragraph 11 below;
all matters of public record as shown in the title commitment;
and other items disclosed to Buyer during the Review Period.
Buyer Initial: /s/ TGM /s/ STM
Purchase Agreement for Hollywood Video, Saraland, AL
Buyer shall be allowed ten (10) days after receipt of said
commitment for examination and the making of any objections to
marketability thereto, said objections to be made in writing or
deemed waived. If any objections are so made, the Seller shall
be allowed eighty (80) days to make such title marketable or in
the alternative to obtain a commitment for insurable title
insuring over Buyer's objections. If Seller shall decide to make
no efforts to make title marketable, or is unable to make title
marketable or obtain insurable title, (after execution by Buyer
of such documents reasonably requested by Seller to evidence the
termination hereof) Buyer's First Payment shall be returned and
this Agreement shall be null and void and of no further force and
effect. Seller has no obligation to spend any funds or make any
effort to satisfy Buyer's objections if any.
Pending satisfaction of Buyer's objections, the payments
hereunder required shall be postponed, but upon satisfaction of
Buyer's objections and within ten (10) days after written notice
of satisfaction of Buyer's objections to the Buyer, the parties
shall perform this Agreement according to its terms.
9. CLOSING COSTS. Seller will pay one-half of escrow fees, the
cost of the title commitment and any brokerage commissions
payable. The Buyer will pay the cost of issuing a Standard
Owners Title Insurance Policy in the full amount of the purchase
price, if Buyer shall decide to purchase the same. Buyer will
pay all recording fees, one-half of the escrow fees, and the cost
of an update to the Survey in Sellers possession (if an update is
required by Buyer.) Each party will pay its own attorney's fees
and costs to document and close this transaction.
10. REAL ESTATE TAXES, SPECIAL ASSESSMENTS AND PRORATIONS.
(a) Because the Entire Property (of which the Property is a
part) is subject to a triple net lease (as further set forth
in paragraph 11(a)(i), the parties acknowledge that there
shall be no need for a real estate tax proration. However,
Seller represents that to the best of its knowledge, all
real estate taxes and installments of special assessments
due and payable in all years prior to the year of Closing
have been paid in full. Unpaid real estate taxes and unpaid
levied and pending special assessments existing on the date
of Closing shall be the responsibility of Buyer and Seller
in proportion to their respective Tenant in Common
interests, pro-rated, however, to the date of closing for
the period prior to closing, which shall be the
responsibility of Seller if Tenant shall not pay the same.
Seller and Buyer shall likewise pay all taxes due and
payable in the year after Closing and any unpaid
installments of special assessments payable therewith and
thereafter, if such unpaid levied and pending special
assessments and real estate taxes are not paid by any tenant
of the Entire Property.
(b) All income and all operating expenses from the Entire
Property shall be prorated between the parties and adjusted
by them as of the date of Closing. Seller shall be entitled
to all income earned and shall be responsible for all
expenses incurred prior to the date of Closing, and Buyer
shall be entitled to its proportionate share of all income
earned and shall be responsible for its proportionate share
of all operating expenses of the Entire Property incurred on
and after the date of closing.
Buyer Initial: /s/ TGM /s/ STM
Purchase Agreement for Hollywood Video, Saraland, AL
11. SELLER'S REPRESENTATION AND AGREEMents.
(a) Seller represents and warrants as of this date that:
(i) Except for the lease in existence between Centurion
Video, LTD (as "Landlord") and Hollywood Entertainment
Corporation ("as Tenant") dated September 27, 1997 and the
assignment of lease from Centurion Video, LTD ("Centurion",
Assignor") to AEI Income & Growth Fund XXII Limited
Partnership ("AEI", "Assignee") dated January 12, 1999,
Seller is not aware of any leases of the Property.
(ii) It is not aware of any pending litigation or
condemnation proceedings against the Property or Seller's
interest in the Property.
(iii) Except as previously disclosed to Buyer and as
permitted in paragraph (b) below, Seller is not aware of any
contracts Seller has executed that would be binding on Buyer
after the closing date.
(b) Provided that Buyer performs its obligations when
required, Seller agrees that it will not enter into any new
contracts that would materially affect the Property and be
binding on Buyer after the Closing Date without Buyer's
prior consent, which will not be unreasonably withheld.
However, Buyer acknowledges that Seller retains the right
both prior to and after the Closing Date to freely transfer
all or a portion of Seller's remaining undivided interest in
the Entire Property, provided such sale shall not encumber
the Property being purchased by Buyer in violation of the
terms hereof or the contemplated Co-Tenancy Agreement.
12. DISCLOSURES.
(a) Seller has not received any notice of any material,
physical, or mechanical defects of the Entire Property,
including without limitation, the plumbing, heating, air
conditioning, ventilating, electrical system. To the best of
Seller's knowledge without inquiry, all such items are in
good operating condition and repair and in compliance with
all applicable governmental, zoning, and land use laws,
ordinances, regulations and requirements. If Seller shall
receive any notice to the contrary prior to Closing, Seller
will inform Buyer prior to Closing.
(b) Seller has not received any notice that the use and
operation of the Entire Property is not in full compliance
with applicable building codes, safety, fire, zoning, and
land use laws, and other applicable local, state and federal
laws, ordinances, regulations and requirements. If Seller
shall receive any notice to the contrary prior to Closing,
Seller will inform Buyer prior to Closing.
(c) Seller knows of no facts nor has Seller failed to
disclose to Buyer any fact known to Seller which would
prevent the Tenant from using and operating the Entire
Property after the Closing in the manner in which the Entire
Property has been used and operated prior to the date of
this Agreement. If Seller shall receive any notice to the
contrary prior to Closing, Seller will inform Buyer prior to
Closing.
Buyer Initial: /s/ TGM /s/ STM
Purchase Agreement for Hollywood Video, Saraland, AL
(d) Seller has not received any notice that the Entire
Property is in violation of any federal, state or local law,
ordinance, or regulations relating to industrial hygiene or
the environmental conditions on, under, or about the Entire
Property, including, but not limited to, soil, and
groundwater conditions. To the best of Seller's knowledge,
there is no proceeding or inquiry by any governmental
authority with respect to the presence of Hazardous
Materials on the Entire Property or the migration of
Hazardous Materials from or to other property. Buyer agrees
that Seller will have no liability of any type to Buyer or
Buyer's successors, assigns, or affiliates in connection
with any Hazardous Materials on or in connection with the
Entire Property either before or after the Closing Date,
except such Hazardous Materials on or in connection with the
Entire Property arising out of Seller's gross negligence or
intentional misconduct. If Seller shall receive any notice
to the contrary prior to Closing, Seller will inform Buyer
prior to Closing.
(e) BUYER AGREES THAT IT SHALL BE PURCHASING THE PROPERTY
IN ITS THEN PRESENT CONDITION, AS IS, WHERE IS, AND SELLER
HAS NO OBLIGATIONS TO CONSTRUCT OR REPAIR ANY IMPROVEMENTS
THEREON OR TO PERFORM ANY OTHER ACT REGARDING THE PROPERTY,
EXCEPT AS EXPRESSLY PROVIDED HEREIN.
(f) BUYER ACKNOWLEDGES THAT, HAVING BEEN GIVEN THE
OPPORTUNITY TO INSPECT THE ENTIRE PROPERTY AND SUCH
FINANCIAL INFORMATION ON THE LESSEE AND GUARANTORS OF THE
LEASE AS BUYER OR ITS ADVISORS SHALL REQUEST, IF IN SELLER'S
POSSESSION, BUYER IS RELYING SOLELY ON ITS OWN INVESTIGATION
OF THE PROPERTY AND NOT ON ANY INFORMATION PROVIDED BY
SELLER OR TO BE PROVIDED EXCEPT AS SET FORTH HEREIN. BUYER
FURTHER ACKNOWLEDGES THAT THE INFORMATION PROVIDED AND TO BE
PROVIDED BY SELLER WITH RESPECT TO THE PROPERTY, THE ENTIRE
PROPERTY AND TO THE LESSEE AND GUARANTORS OF LEASE WAS
OBTAINED FROM A VARIETY OF SOURCES AND SELLER NEITHER (A)
HAS MADE INDEPENDENT INVESTIGATION OR VERIFICATION OF SUCH
INFORMATION, OR (B) MAKES ANY REPRESENTATIONS AS TO THE
ACCURACY OR COMPLETENESS OF SUCH INFORMATION EXCEPT AS
HEREIN SET FORTH. THE SALE OF THE PROPERTY AS PROVIDED FOR
HEREIN IS MADE ON AN "AS IS" BASIS, AND BUYER EXPRESSLY
ACKNOWLEDGES THAT, IN CONSIDERATION OF THE AGREEMENTS OF
SELLER HEREIN, EXCEPT AS OTHERWISE SPECIFIED HEREIN IN
PARAGRAPH 11(A) AND (B) ABOVE AND THIS PARAGRAPH 12, SELLER
MAKES NO WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, OR
ARISING BY OPERATION OF LAW, INCLUDING, BUT NOT LIMITED TO,
ANY WARRANTY OF CONDITION, HABITABILITY, TENANTABILITY,
SUITABILITY FOR COMMERCIAL PURPOSES, MERCHANTABILITY, OR
FITNESS FOR A PARTICULAR PURPOSE, IN RESPECT OF THE
PROPERTY.
The provisions (d) - (f) above shall survive Closing.
13. CLOSING.
(a) Before the closing date, Seller will deposit into
escrow an executed special warranty deed warranting title
against lawful claims by, through, or under a conveyance
from Seller, but not further or otherwise, conveying
insurable title of the Property to Buyer, subject to the
exceptions contained in paragraph 8 above.
Buyer Initial: /s/ TGM /s/ STM
Purchase Agreement for Hollywood Video, Saraland, AL
(b) On or before the closing date, Buyer will deposit into
escrow: the balance of the purchase price when required
under Section 4; any additional funds required of Buyer,
(pursuant to this agreement or any other agreement executed
by Buyer) to close escrow. Both parties will sign and
deliver to the escrow holder any other documents reasonably
required by the escrow holder to close escrow.
(c) On the closing date, if escrow is in a position to
close, the escrow holder will: record the deed in the
official records of the county where the Property is
located; cause the title company to commit to issue the
title policy; immediately deliver to Seller the portion of
the purchase price deposited into escrow by cashier's check
or wire transfer (less debits and prorations, if any);
deliver to Seller and Buyer a signed counterpart of the
escrow holder's certified closing statement and take all
other actions necessary to close escrow.
14. DEFAULTS. If Buyer defaults, Buyer will forfeit all rights
and claims and Seller will be relieved of all obligations and
will be entitled to retain all monies heretofore paid by the
Buyer. In addition, Seller shall retain all remedies available
to Seller at law or in equity.
If Seller shall default, Buyer irrevocably waives any rights
to file a lis pendens, a specific performance action or any other
claim, action or proceeding of any type in connection with the
Property or this or any other transaction involving the Property,
and will not do anything to affect title to the Property or
hinder, delay or prevent any other sale, lease or other
transaction involving the Property (any and all of which will be
null and void), unless: it has paid the First Payment, deposited
the balance of the Second Payment for the purchase price into
escrow, performed all of its other obligations and satisfied all
conditions under this Agreement, and unconditionally notified
Seller that it stands ready to tender full performance, purchase
the Property and close escrow as per this Agreement, regardless
of any alleged default or misconduct by Seller. Provided,
however, that in no event shall Seller be liable for any actual,
punitive, consequential or speculative damages arising out of any
default by Seller hereunder.
15. BUYER'S REPRESENTATIONS AND WARRANTIES.
a. Buyer represents and warrants to Seller as follows:
(i) In addition to the acts and deeds recited herein and
contemplated to be performed, executed, and delivered by
Buyer, Buyer shall perform, execute and deliver or cause to
be performed, executed, and delivered at the Closing or
after the Closing, any and all further acts, deeds and
assurances as Seller or the Title Company may require and be
reasonable in order to consummate the transactions
contemplated herein.
(ii) Buyer has all requisite power and authority to
consummate the transaction contemplated by this Agreement
and has by proper proceedings duly authorized the execution
and delivery of this Agreement and the consummation of the
transaction contemplated hereby.
Buyer Initial: /s/ TGM /s/ STM
Purchase Agreement for Hollywood Video, Saraland, AL
(iii) To Buyer's knowledge, neither the execution and
delivery of this Agreement nor the consummation of the
transaction contemplated hereby will violate or be in
conflict with (a) any applicable provisions of law, (b) any
order of any court or other agency of government having
jurisdiction hereof, or (c) any agreement or instrument to
which Buyer is a party or by which Buyer is bound.
16. DAMAGES, DESTRUCTION AND EMINENT DOMAIN.
(a) If, prior to closing, the Property or any part thereof
is destroyed or further damaged by fire, the elements, or
any cause, due to events occurring subsequent to the date of
this Agreement to the extent that the cost of repair exceeds
$10,000.00, this Agreement shall become null and void, at
Buyer's option exercised, if at all, by written notice to
Seller within ten (10) days after Buyer has received written
notice from Seller of said destruction or damage. Seller,
however, shall have the right to adjust or settle any
insured loss until (i) all contingencies set forth in
Paragraph 6 hereof have been satisfied, or waived; and (ii)
any ten-day period provided for above in this Subparagraph
16a for Buyer to elect to terminate this Agreement has
expired or Buyer has, by written notice to Seller, waived
Buyer's right to terminate this Agreement. If Buyer elects
to proceed and to consummate the purchase despite said
damage or destruction, there shall be no reduction in or
abatement of the purchase price, and Seller shall assign to
Buyer the Seller's right, title, and interest in and to all
insurance proceeds (pro-rata in relation to the Entire
Property) resulting from said damage or destruction to the
extent that the same are payable with respect to damage to
the Property, subject to rights of any Tenant of the Entire
Property.
If the cost of repair is less than $10,000.00, Buyer shall
be obligated to otherwise perform hereinunder with no
adjustment to the Purchase Price, reduction or abatement,
and Seller shall assign Seller's right, title and interest
in and to all insurance proceeds pro-rata in relation to the
Entire Property, subject to rights of any Tenant of the
Entire Property.
(b) If, prior to closing, the Property, or any part
thereof, is taken by eminent domain, this Agreement shall
become null and void, at Buyer's option. If Buyer elects to
proceed and to consummate the purchase despite said taking,
there shall be no reduction in, or abatement of, the
purchase price, and Seller shall assign to Buyer the
Seller's right, title, and interest in and to any award
made, or to be made, in the condemnation proceeding pro-rata
in relation to the Entire Property, subject to rights of any
Tenant of the Entire Property.
In the event that this Agreement is terminated by Buyer as
provided above in Subparagraph 16a or 16b, the First Payment
shall be immediately returned to Buyer (after execution by Buyer
of such documents reasonably requested by Seller to evidence the
termination hereof).
Buyer Initial: /s/ TGM /s/ STM
Purchase Agreement for Hollywood Video, Saraland, AL
17. BUYER'S 1031 TAX FREE EXCHANGE.
While Seller acknowledges that Buyer is purchasing the
Property as "replacement property" to accomplish a tax free
exchange, Buyer acknowledges that Seller has made no
representations, warranties, or agreements to Buyer or Buyer's
agents that the transaction contemplated by the Agreement will
qualify for such tax treatment, nor has there been any reliance
thereon by Buyer respecting the legal or tax implications of the
transactions contemplated hereby. Buyer further represents that
it has sought and obtained such third party advice and counsel as
it deems necessary in regards to the tax implications of this
transaction.
Buyer wishes to novate/assign the ownership rights and
interest of this Purchase Agreement to Chicago Title Exchange
Accommodator, Inc., which will act as Accommodator to perfect the
1031 exchange by preparing an agreement of exchange of Real
Property whereby Chicago Title Exchange Accommodator, Inc., will
be an independent third party purchasing the ownership interest
in subject property from Seller and selling the ownership
interest in subject property to Buyer under the same terms and
conditions as documented in this Purchase Agreement. Seller
consents to such assignments. Buyer asks the Seller, and Seller
agrees to cooperate in the perfection of such an exchange if at
no additional cost or expense to Seller or delay in time. Buyer
hereby indemnifies and holds Seller harmless from any claims
and/or actions resulting from said exchange. Pursuant to the
direction of Chicago Title Exchange Accommodator, Inc., Seller
will deed the Property directly to Buyer.
18. CANCELLATION
If any party elects to cancel this Contract because of any
breach by another party or because escrow fails to close by
the agreed date, the party electing to cancel shall deliver
to escrow agent a notice containing the address of the party
in breach and stating that this Contract shall be cancelled
unless the breach is cured within 13 days following the
delivery of the notice to the escrow agent. Within three
days after receipt of such notice, the escrow agent shall
send it by United States Mail to the party in breach at the
address contained in the Notice and no further notice shall
be required. If the breach is not cured within the 13 days
following the delivery of the notice to the escrow agent,
this Contract shall be cancelled.
19. MISCELLANEOUS.
(a) This Agreement may be amended only by written agreement
signed by both Seller and Buyer, and all waivers must be in
writing and signed by the waiving party. Time is of the
essence. This Agreement will not be construed for or
against a party whether or not that party has drafted this
Agreement. If there is any action or proceeding between the
parties relating to this Agreement the prevailing party will
be entitled to recover attorney's fees and costs. This is
an integrated agreement containing all agreements of the
parties about the Property and the other matters described,
and it supersedes any other agreements or understandings.
Exhibits attached to this Agreement are incorporated into
this Agreement. This Agreement shall be governed by, and
interpreted in accordance with, the laws of the State of
Alabama.
Buyer Initial: /s/ TGM /s/ STM
Purchase Agreement for Hollywood Video, Saraland, AL
(b) If this escrow has not closed by April 30, 2000,
through no fault of Seller, Seller may either, at its
election, extend the closing date or exercise any remedy
available to it by law, including terminating this
Agreement.
(c) Funds to be deposited or paid by Buyer must be good and
clear funds in the form of cash, cashier's checks or wire
transfers.
(d) All notices from either of the parties hereto to the
other shall be in writing and shall be considered to have
been duly given or served if sent by first class certified
mail, return receipt requested, postage prepaid, or by a
nationally recognized courier service guaranteeing overnight
delivery to the party at his or its address set forth below,
or to such other address as such party may hereafter
designate by written notice to the other party.
If to Seller:
Attention: Robert P. Johnson
AEI Income & Growth Fund XXII Limited Partnership
1300 Minnesota World Trade Center
30 E. 7th Street
St. Paul, MN 55101
If to Buyer:
Wuest Estate Company
1380-C Garnett Avenue
San Diego, CA 92109
When accepted, this offer will be a binding agreement for
valid and sufficient consideration which will bind and benefit
Buyer, Seller and their respective successors and assigns. Buyer
is submitting this offer by signing a copy of this offer and
delivering it to Seller. Seller has five (5) business days from
receipt within which to accept this offer.
REST OF PAGE INTENTIONALLY LEFT BLANK
Buyer Initial: /s/ TGM /s/ STM
Purchase Agreement for Hollywood Video, Saraland, AL
IN WITNESS WHEREOF, the Seller and Buyer have executed this
Agreement effective as of the day and year above first written.
BUYER: Wuest Estate Company, A California Corporation
By:/s/ Thomas G Morton
Thomas G. Morton, Senior Vice President
By:/s/ Steve T Morton
Steven T. Morton, Assistant Secretary
SELLER: AEI Income & Growth Fund XXII Limited Partnership
By: AEI Fund Management XXI, Inc., its corporate
general partner
By:/s/ Robert P Johnson
Robert P. Johnson, President
Buyer Initial: /s/ TGM /s/ STM
Purchase Agreement for Hollywood Video, Saraland, AL
EXHIBIT A
Lot 1, WAL*MART SQUARE, according to the plat thereof
recorded in Map Book 70, Page 25 of the probate Court
Records of Mobile County, Alabama.
PROPERTY CO-TENANCY
OWNERSHIP AGREEMENT
(Hollywood Video, Saraland, AL)
THIS CO-TENANCY AGREEMENT,
Made and entered into as of the 21st day of April, 2000, by and
between Wuest Estate Company, A California Corporation
(hereinafter called "Wuest") and AEI Income & Growth Fund XXII
Limited Partnership (hereinafter called "Fund XXII") (Wuest, Fund
XXII (and any other Owner in Fee where the context so indicates)
being hereinafter sometimes collectively called "Co-Tenants" and
referred to in the neuter gender).
WITNESSETH:
WHEREAS, Fund XXII presently owns an undivided 74.8876% interest
in and to, and Wuest presently owns an undivided 12.5832%
interest in and to, and Carl R. Whittington, Trustee of the Carl
R. Whittington Trust, dated October 16, 1996 presently owns an
undivided 12.5292% interest in and to the land, situated in the
City of Saraland, County of Mobile, and State of AL, (legally
described upon Exhibit A attached hereto and hereby made a part
hereof) and in and to the improvements located thereon
(hereinafter called "Premises");
WHEREAS, The parties hereto wish to provide for the orderly
operation and management of the Premises and Wuest's interest by
Fund XXII; the continued leasing of space within the Premises;
for the distribution of income from and the pro-rata sharing in
expenses of the Premises.
NOW THEREFORE, in consideration of the purchase by Wuest of an
undivided interest in and to the Premises, for at least One
Dollar ($1.00) and other good and valuable consideration by the
parties hereto to one another in hand paid, the receipt and
sufficiency of which are hereby acknowledged, and of the mutual
covenants and agreements herein contained, it is hereby agreed by
and between the parties hereto, as follows:
1. The operation and management of the Premises shall be
delegated to Fund XXII, or its designated agent, successors or
assigns. Provided, however, if Fund XXII shall sell all of its
interest in the Premises, the duties and obligations of Fund XXII
respecting management of the Premises as set forth herein,
including but not limited to paragraphs 2, 3, and 4 hereof, shall
be exercised by the holder or holders of a majority undivided co-
tenancy interest in the Premises. Except as hereinafter expressly
provided to the contrary, each of the parties hereto agrees to be
bound by the decisions of Fund XXII with respect to all
administrative, operational and management matters of the
property comprising the Premises, including but not limited to
the management of the net lease agreement for the Premises.
Wuest hereto hereby designates Fund XXII as its sole and
exclusive agent to deal with, and Fund XXII retains the sole
right to deal with, any property agent or tenant and to negotiate
and enter into, on terms and provisions satisfactory to Fund
XXII, monitor, execute and enforce the terms of leases of space
within the Premises, including but not limited to any amendments,
consents to assignment, sublet, releases or modifications to
leases or guarantees of lease or easements affecting the
Premises, on behalf
Co-Tenant Initial: /s/ TGM /s/ STM
Co-Tenancy Agreement for Hollywood Video, Saraland, AL
of Wuest As long as Fund XXII owns an interest in the
Premises, only Fund XXII may obligate Wuest with respect to
any expense for the Premises.
As further set forth in paragraph 2 hereof, Fund XXII agrees to
require any lessee of the Premises to name Wuest as an insured or
additional insured in all insurance policies provided for, or
contemplated by, any lease on the Premises. Fund XXII shall use
its best efforts to obtain endorsements adding Co-Tenants to said
policies from lessee within 30 days of commencement of this
agreement. In any event, Fund XXII shall distribute any insurance
proceeds it may receive, to the extent consistent with any lease
on the Premises, to the Co-Tenants in proportion to their
respective ownership of the Premises.
2. Income and expenses shall be allocated among the Co-Tenants
in proportion to their respective share(s) of ownership. Shares
of net income shall be pro-rated for any partial calendar years
included within the term of this Agreement. Fund XXII may offset
against, pay to itself and deduct from any payment due to Wuest
under this Agreement, and may pay to itself the amount of Wuest
's share of any reasonable expenses of the Premises which are not
paid by Wuest to Fund XXII or its assigns, within ten (10) days
after demand by Fund XXII. In the event there is insufficient
operating income from which to deduct Wuest's unpaid share of
operating expenses, Fund XXII may pursue any and all legal
remedies for collection.
Operating Expenses shall include all normal operating expense,
including but not limited to: maintenance, utilities, supplies,
labor, management, advertising and promotional expenses, salaries
and wages of rental and management personnel, leasing commissions
to third parties, a monthly accrual to pay insurance premiums,
real estate taxes, installments of special assessments and for
structural repairs and replacements, management fees, legal fees
and accounting fees, but excluding all operating expenses paid by
tenant under terms of any lease agreement of the Premises.
Wuest has no requirement to, but has, nonetheless elected to
retain, and agrees to annually reimburse, Fund XXII in the amount
of $571 for the expenses, direct and indirect, incurred by Fund
XXII in providing Wuest with quarterly accounting and
distributions of Wuest 's share of net income and for tracking,
reporting and assessing the calculation of Wuest 's share of
operating expenses incurred from the Premises. This invoice
amount shall be pro-rated for partial years and Wuest authorizes
Fund XXII to deduct such amount from Wuest's share of revenue
from the Premises. Wuest may terminate this agreement in this
paragraph respecting accounting and distributions at any time and
attempt to collect its share of rental income directly from the
tenant; however, enforcement of all other provisions of the lease
remains the sole right of Fund XXII pursuant to Section 1 hereof.
Fund XXII may terminate its obligation under this paragraph upon
30 days notice to Wuest prior to the end of each anniversary
hereof, unless agreed in writing to the contrary.
3. Full, accurate and complete books of account shall be kept
in accordance with generally accepted accounting principles at
Fund XXII's principal office, and each Co-Tenant shall have
access to such books and may inspect and copy any part thereof
during normal business hours. Within ninety (90) days after the
end of each calendar year during the term hereof, Fund XXII shall
prepare an accurate income statement for the ownership of the
Premises for said calendar
Co-Tenant Initial: /s/ TGM /s/ STM
Co-Tenancy Agreement for Hollywood Video, Saraland, AL
year and shall furnish copies of the same to all Co-Tenants.
Quarterly, as its share, Wuest shall be entitled to receive
12.5832% of all items of income and expense generated by the
Premises. Upon receipt of said accounting, if the payments
received by each Co-Tenant pursuant to this Paragraph 3 do not
equal, in the aggregate, the amounts which each are entitled
to receive proportional to its share of ownership with respect
to said calendar year pursuant to Paragraph 2 hereof, an
appropriate adjustment shall be made so that each Co-Tenant
receives the amount to which it is entitled.
4. If Net Income from the Premises is less than $0.00 (i.e.,
the Premises operates at a loss), or if capital improvements,
repairs, and/or replacements, for which adequate reserves do not
exist, need to be made to the Premises, the Co-Tenants, upon
receipt of a written request therefor from Fund XXII, shall,
within fifteen (15) business days after receipt of notice, make
payment to Fund XXII sufficient to pay said net operating losses
and to provide necessary operating capital for the premises and
to pay for said capital improvements, repairs and/or
replacements, all in proportion to their undivided interests in
and to the Premises.
5. Co-Tenants may, at any time, sell, finance, or otherwise
create a lien upon their interest in the Premises but only upon
their interest and not upon any part of the interest held, or
owned, by any other Co-Tenant. All Co-Tenants reserve the right
to escrow proceeds from a sale of their interests in the Premises
to obtain tax deferral by the purchase of replacement property.
6. If any Co-Tenant shall be in default with respect to any of
its obligations hereunder, and if said default is not corrected
within thirty (30) days after receipt by said defaulting Co-
Tenant of written notice of said default, or within a reasonable
period if said default does not consist solely of a failure to
pay money, the remaining Co-Tenant(s) may resort to any available
remedy to cure said default at law, in equity, or by statute.
7. This Co-Tenancy Agreement shall continue in full force and
effect and shall bind and inure to the benefit of the Co-Tenant
and their respective heirs, executors, administrators, personal
representatives, successors and permitted assigns until January
30, 2033 or upon the sale of the entire Premises in accordance
with the terms hereof and proper disbursement of the proceeds
thereof, whichever shall first occur. Unless specifically
identified as a personal contract right or obligation herein,
this agreement shall run with any interest in the Premises and
with the title thereto. Once any person, party or entity has
ceased to have an interest in fee in any portion of the Premises,
it shall not be bound by, subject to or benefit from the terms
hereof; but its heirs, executors, administrators, personal
representatives, successors or assigns, as the case may be, shall
be substituted for it hereunder.
8. Any notice or election required or permitted to be given or
served by any party hereto to, or upon any other, shall be given
to all known Co-Tenants and deemed given or served in accordance
with the provisions of this Agreement, if said notice or
elections addressed as follows;
Co-Tenant Initial: /s/ TGM /s/ STM
Co-Tenancy Agreement for Hollywood Video, Saraland, AL
If to Fund XXII:
AEI Income and Growth Fund XXII Limited Partnership
1300 Minnesota World Trade Center
30 E. Seventh Street
St. Paul, Minnesota 55101
If to Wuest:
Wuest Estate Company
1380-C Garnett Avenue
San Diego, CA 92109
If to Whittington:
Carl R. Whittington, Trustee
1440 Elm Grove Avenue
Akron, OH 44312
Each mailed notice or election shall be deemed to have been given
to, or served upon, the party to which addressed on the date the
same is deposited in the United States certified mail, return
receipt requested, postage prepaid, or given to a nationally
recognized courier service guaranteeing overnight delivery as
properly addressed in the manner above provided. Any party hereto
may change its address for the service of notice hereunder by
delivering written notice of said change to the other parties
hereunder, in the manner above specified, at least ten (10) days
prior to the effective date of said change.
9. This Agreement shall not create any partnership or joint
venture among or between the Co-Tenants or any of them, and the
only relationship among and between the Co-Tenants hereunder
shall be that of owners of the premises as tenants in common
subject to the terms hereof.
10. The unenforceability or invalidity of any provision or
provisions of this Agreement as to any person or circumstances
shall not render that provision, nor any other provision hereof,
unenforceable or invalid as to any other person or circumstances,
and all provisions hereof, in all other respects, shall remain
valid and enforceable.
11. In the event any litigation arises between the parties
hereto relating to this Agreement, or any of the provisions
hereof, the party prevailing in such action shall be entitled to
receive from the losing party, in addition to all other relief,
remedies and damages to which it is otherwise entitled, all
reasonable costs and expenses, including reasonable attorneys'
fees, incurred by the prevailing party in connection with said
litigation.
REST OF PAGE INTENTIONALLY LEFT BLANK
Co-Tenant Initial: /s/ TGM /s/ STM
Co-Tenancy Agreement for Hollywood Video, Saraland, AL
IN WITNESS WHEREOF, The parties hereto have caused this Agreement
to be executed and delivered, as of the day and year first above
written.
Wuest: Wuest Estate Company, A California Corporation
By:/s/ Thomas G Morton
Thomas G. Morton, Senior Vice President
By: /s/ Steven T Morton
Steven T. Morton, Assistant Secretary
STATE OF CALIFORNIA)
) ss
COUNTY OF SAN DIEGO)
I, a Notary Public in and for the state and county of aforesaid,
hereby certify there appeared before me this 17th day of April,
2000, Thomas G. Morton, Senior Vice President and Steven T.
Morton, Assistant Secretary, who executed the foregoing
instrument in said capacity.
/s/ Angela Ponce DeLeon
Notary Public
[notary seal]
Co-Tenant Initial: /s/ TGM /s/ STM
Co-Tenancy Agreement for Hollywood Video, Saraland, AL
Fund XXII: AEI Income & Growth Fund XXII Limited Partnership
By: AEI Fund Management XXI, Inc., its corporate general
partner
By:/s/ Robert P Johnson
Robert P. Johnson, President
State of Minnesota )
) ss.
County of Ramsey )
I, a Notary Public in and for the state and county of aforesaid,
hereby certify there appeared before me this 21st day of April,
2000, Robert P. Johnson, President of AEI Fund Management XXI,
Inc., corporate general partner of AEI Income & Growth Fund XXII
Limited Partnership, who executed the foregoing instrument in
said capacity and on behalf of the corporation in its capacity as
corporate general partner, on behalf of said limited partnership.
/s/ Linda A Bisdorf
Notary Public
[notary seal]
Co-Tenant Initial: /s/ TGM /s/ STM
Co-Tenancy Agreement for Hollywood Video, Saraland, AL
EXHIBIT A
Lot 1, WAL*MART SQUARE, according to the plat thereof recorded in
Map Book 70, Page 25 of the probate Court Records of Mobile
County, Alabama.
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<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-END> MAR-31-2000
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0
0
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