SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES AND EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported) April 24, 1996
AEI REAL ESTATE FUND 86-A LIMITED PARTNERSHIP
(Exact Name of Registrant as Specified in its Charter)
State of Delaware
(State or other Jurisdiction of Incorporation or
Organization)
0-14090 41-6273958
(Commission File Number) (I.R.S. Employer
Identification No.)
1300 Minnesota World Trade Center, St. Paul, Minnesota 55101
(Address of Principal Executive Offices)
(612) 227-7333
(Registrant's telephone number, including area code)
(Former name or former address, if changed since last report)
Item 1. Changes in Control of Registrant.
Not Applicable.
Item 2. Acquisition or Disposition of Assets.
On April 24, 1996, the Partnership sold its office
building in Kearney, Nebraska to Sports West, L.L.C. Sports
West, L.L.C. is not affiliated with the Partnership. The
total cash sales price was $350,000.
The Partnership received net proceeds of approximately
$330,500 for the property and recognized a net gain of
approximately $19,000.
Item 3. Bankruptcy or Receivership.
Not Applicable.
Item 4. Changes in Registrant's Certifying Accountant.
Not Applicable.
Item 5. Other Events.
None.
Item 6. Resignation of Registrant's Directors.
Not Applicable.
Item 7. Financial Statements and Exhibits.
(a) A limited number of proforma adjustments are
required to illustrate the effects of the
transaction on the balance sheet and income
statement. The following narrative
description is furnished in lieu of the
proforma statements:
Assuming the Partnership had sold the property
on December31, 1995, the Partnership's
Investments in Real Estate and Accumulated
Depreciation would have been reduced by
$434,623 and $118,736, respectively, and its
Current Assets (cash) would have been
increased by $330,500. The Partnership would
have recognized a net gain of approximately
$14,415. The difference between this gain and
the actual gain of approximately $19,000 is
depreciation for the first quarter of 1996.
(c) Exhibits
Exhibit 10.1 - Purchase Agreement dated
March 20, 1996 between the
Partnership, Mark H. Meyer and
David L. Meyer relating to the
property at 2501 30th Avenue,
Kearney, Nebraska.
Exhibit 10.2 - Assignment of Purchaser's
interest in Purchase
Agreement dated April 23, 1996
between Mark H. Meyer, David L.
Meyer and Sports West, L.L.C.
relating to the property at 2501
30th Avenue, Kearney, Nebraska.
SIGNATURES
Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly
authorized.
AEI REAL ESTATE FUND 86-A
LIMITED PARTNERSHIP
By: AEI Fund Management 86-A, Inc.
Its: Managing General Partner
Date: May 6, 1996 /s/ Mark E. Larson
By: Mark E. Larson
Its Chief Financial Officer
[COLDWELL BANKER SIGN] [REALTOR SYMBOL]
[EQUAL HOUSING
OPPORTUNITY SYMBOL]
THIS IS A LEGALLY BINDING AGREEMENT
IF NOT UNDERSTOOD, SEEK LEGAL ADV.
The REALTOR negotiating this agreement is a member of the
Nebraska REALTORS Association and as such is governed by its
Code of Ethics and Rules and Regulations.
PURCHASE AGREEMENT
COLDWELL BANKER TOWN & COUNTRY REALTY, 4503 2nd Avenue,
Kearney, Nebraska, 68847 Date 3-20-96
The undersigned, as Buyer, agrees to purchase the following
Property: Address: 2501 30th Ave. Kearney, Ne.
Legal Description. See Legal Description Attached
including all fixtures and equipment permanently attached to
the Property provided Seller has a marketable title in fee
simple. The only personal property is included as follows:
ALL PERSONAL PROPERTY PERTAINING TO THE BUILDING TO REMAIN WITH
THE SALE Seller agrees to furnish a title insurance policy
insuring marketability and Buyer shall be furnished a current
title insurance commitment by Seller prior to closing. The
cost of title insurance issued for this sale, if any, 1/2-Buyer
and 1/2-Seller
Buyer has option of selecting, or approving as selected by the
Seller, the title insurance company. However, if Buyer and
Seller agree, Seller may furnish an abstract of title certified
to date in lieu of title insurance. If any defects in title
are found in the abstract Buyer agrees to furnish a copy of a
written title opinion from Buyer's attorney showing the
defects. Buyer agrees that should a valid title defect exist,
Seller has a reasonable time to correct said defect. **If the
title defects are not cured within a reasonable time period,
the Buyer may declare this Agreement null and void, and be
entitled to full return of earnest money. Seller agrees to
convey the subject Property to Buyer by warranty deed or NO
EXCEPTIONS free and clear of all liens, encumbrances, special
assessments levied or assessed, except NO EXCEPTIONS
and subject to all easements and restrictions or covenants of
record. Seller agrees to pay any assessments for items such as
paving, curbing, sidewalk or utilities previously constructed,
now under construction, or ordered to be constructed by public
authority not yet assessed. The documentary stamp tax shall be
paid by the Seller.
Buyer agrees to pay 350,000.00 DOLLARS, on the following
terms: an earnest money deposit of $ 5,000.00 at this time as
shown by the receipt herein. If paid by check, it will be cashed.
The earnest money deposit will be transferred to the listing
broker on acceptance, if the selling broker is other than the
listing broker. All monies shall be deposited in a trust
account, to be held until the time of closing or until
transferred to an escrow agent by agreement of Buyer and
Seller; balance to be paid as shown in Paragraph(s) #
following:
#1. ALL CASH: Balance of $ shall be paid in
cash, or be certified or cashier's check at time of delivery of
deed, no financing being required.
#2. CONDITIONAL UPON LOAN: Balance of $ 345,000.00 shall
be paid in cash, or be certified or cashier's check at time of
delivery of deed, contingent upon Buyer's ability to obtain a
loan, to be secured by first mortgage or deed of trust, on
above described Property in the amount of $ 350,00.00 . The
loan shall be BANK FINANCING WITH TERMS ACCEPTABLE TO THE
BUYERS. SAID FINANCING CONTINGENCY MUST BE ASSERTED OR DEEMED
WAIVED ON OR BEFORE APRIL 5, 1996. SELLER SHALL BEAR NO COSTS
ASSOCIATED WITH SUCH LOAN.
#3. OTHER PROVISIONS: THIS OFFER IS BASED ON CITY OF
KEARNEY APPROVAL OF USEAGE AND CURRENT OFF STREET PARKING ON
SITE. BUYER SHALL ALSO HAVE THE RIGHT TO OBTAIN A BUILDING
INSPECTION AT BUYERS COST IF THE INSPECTION IS NOT SATISFACTORY
IN BUYERS OPINION, BUYER MAY VOID THIS AGREEMENT AND HAVE
EARNEST DEPOSIT RETURNED IN FULL TO BUYER.**
#4. ADDENDUM: The attached addenda shall be made a part
of the Purchase Agreement. (please initial) Seller /s/ ML
Buyer /s/MHM /s/DLM (List Addenda) Dual Agency Addendum and
Purchase Agreement Addendum
Seller's total liability for any costs for replacement
and /or repairs requested in any items listed in paragraphs 3
or 4 above shall not exceed $ . Should replacement and/or
repairs exceed this amount and seller does not elect to pay the
cost in excess of such amount, Buyer shall have the option of
declaring this Agreement null and void and be entitled to full
return of the earnest money.
Seller shall pay all taxes to and including 1995. Taxes
for the calendar year 1996, together with interest and rents
and homeowners association dues, if any shall be prorated to
date of possession [ ], closing [X], or Taxes shall be
prorated on the basis of the prior year's taxes unless the
current tax rate is available in which case taxes shall be
prorated on the basis of the current valuation and tax rate.
The closing of the sale shall be on or before the 15TH day
of April, 1996. Possession of Property to be DAY OF CLOSING.
Buyer requests a termite and wood destroying insect
inspection of the building(s) at Buyer's expense (except should
Buyer obtain VA loan, the expense shall be paid by Seller).
Should evidence of termites or wood destroying insects be
found, the building(s) shall be treated at Seller's expense.
Buyer agrees to accept the treated Property. If visible
evidence of previously treated infestation which is now
inactive is found, treatment shall not be required. Should damage
from such insects be found, the damage shall be corrected at
Seller's expense. However, if the cost required for repairs
exceeds 1% of the purchase price, and Seller does not elect to
pay the cost in excess of such amount, Buyer shall have the
option of declaring this Agreement null and void and be
entitled to full return of the earnest money.
This offer is based upon Buyer's personal inspection or
investigation of the Property. Buyer agrees to accept the
Property in its present condition, except as provided herein.
Seller agrees to maintain the lawn, removal of snow from
sidewalks and driveways, heating, air conditioning,
waterheater, sewer, plumbing, electrical system, any built-in
appliances in their present condition until delivery of
possession. Seller represents that there are no latent defects
in the Propert of which the Seller is aware except those that
are set forth in "Seller's Description of Property."
This agreement shall in no manner be construed to convey
the Property or to give any right of possession. Risk of loss
or damage to the Property, prior to closing date, shall be the
responsibility of the Seller. If, prior to closing, the
structures on the Property are materially damaged by fire,
explosion or any other cause, Buyer shall have the right to
rescind this Agreement, and be entitled to full return on the
earnest money.
If Buyer fails to consumate this purchase according to the
terms of this Agreement, Seller may, at Seller's option, retain
the earnest money as liquidated damages for such failure, or
utilize such other legal remedies as are available to Seller by
reason of such failure.
Buyer understands that this Property is located within
Sanitary Improvement District (S.I.D) # NA (Buyer should
initial if applicable.)
Buyer and Seller acknowledge and understand that the
closing of the sale may be handled by an escrow agent and that
the listing broker, COLDWELL BANKER/T&C, is authorized to
transfer the earnest money or any other funds received to the
escrow agent. After the transfer, broker shall have no
further responsibility or liability to Buyer or Seller to
account for the funds. Escrow agent's charges shall then be
equally divided between Buyer and Seller. If Buyer's loan is a
government-regulated loan which prohibits Buyer form paying
such charges, then they shall be paid by Seller.
This offer is null and void if not accepted by the Seller
on or before 3-21-96 by Fax 3-30-96 Written
**SEE ATTACHED ADDENDUM
AGENCY CONFIRMATION-. The following agency relationships are
hereby confirmed for this transaction:
Listing Agent Steve McCormick is an agent of (check one):
the Seller exclusively [ ] or both the Buyer and Seller [ ]
Selling Agent: Steve McCormick (if not the same as Listing
Agent) is the agent of (check one): the Buyer exclusively [ ]
or the Seller exclusively [ ] or both the Buyer and Seller [ ].
Buyer acknowledges receipt of a copy of this offer, which
has not yet been signed by Seller.
BUYER /s/ Mark H. Meyer DATE /s/ 3/20/96 SS#FedID#
BUYER /s/ David L. Meyer DATE SS#FedID#
ADDRESS ZIP PHONE
NAMES FOR DEED: /s/ M&D Enterprises, L.L.C.
RECEIPT FOR EARNEST MONEY
RECEIVED FROM: M&D Enterprises
the sum of $5,000.00 DOLLARS (check) to apply to the purchase
price of the Property on terms and conditions as stated. In
the event this offer is not accepted by the Seller of the
Property within the time specified, or in the event there are
any defects in the title which cannot be cured as specified
above, the Deposit shall be refunded.
Coldwell Banker Town & Country REALTORS By /s/ Betty J. Warren
ACCEPTANCE
Dated:
Seller accepts the foregoing proposition on the terms stated
and agrees to convey title to the Property, deliver possession,
and perform all the terms and conditions set forth. Seller
appoints Coldwell Banker T & C to close the sale in accordance
with the terms of this contract and in so doing to receive and
pay out money and deliver the deed to the Property at the time
of closing.
SELLER /s/ AEI Real Estate Fund 86-A Ltd SS#/FedID# /s/ 41-6273958
Partnership
BY AEI Fund Management 86-A Inc
Its Managing General Partner
BY Mark E. Larson its CFO
SELLER SS#/FedID#
STATE OF STATE OF
)Ss )Ss
COUNTY OF COUNTY OF
The foregoing Purchase Agreement was acknowledged before me on The
foregoing Purchase Agreement was acknowledged before me on, 19,
by ,19, by
Notary Public Notary Public
Commission expires Commission expires
(seal) (seal)
RECEIPTS FOR FULLY EXECUTED PURCHASE AGREEMENT
Buyer acknowledges receipt of executed copy of this Agreement
and the SID statement required by Neb.Rev.Stat. 31-727.03, if
applicable
Date Date
(Buyer) (Buyer)
Seller acknowledges receipt of executed copy of this Agreement.
/s/ Mark E. Larson Date /s/ 3/27/96 Date
(Seller) (Seller)
/s/ CFO
AMENDMENT TO UNIFORM PURCHASE AGREEMENT
Dated ,19 on
Property located at
FEDERAL HOUSING ADMINISTRATION (FHA)/VETERANS ADMINISTRATION
(VA) ESCAPE CLAUSE
"It is expressly agreed that notwithstanding any other
provisions of this contract, the purchaser shall not be
obligated to complete the purchase of the property described
herein or to incur any penalty in forfeiture of earnest money
deposit or otherwise unless the purchaser has been given in
accordance with HUD/FHA or VA requirements a written statement
by the Federal Housing Commissioner, Veterans Administration,
or a Direct Endorsement lender setting forth the appraised
value of the property of not less than $ . The
purchaser shall have the privilege and option of proceeding
with consummation of the contract without regard to the amount
of the appraised valuation. The appraised valuation is arrived
to determine the maximum mortgage the Department of Housing and
Urban Development will insure. HUD does not warrant the value
nor the condition of the property, The purchaser should satisfy
himself/herself that the price and condition of the property
are acceptable.
Seller Buyer
(Date) (Date)
Seller Buyer
(Date) (Date)
ACKNOWLEDGMENT OF RECEIPT OF LEAD-BASED PAINT NOTICE
The undersigned Buyer acknowledges that the lead-based paint
notice has been read and a copy has been received before
signing the Purchase Agreement.
Buyer Buyer
(Date) (Date)
BUYER PLEASE NOTE
At closing Buyer is required to have cash or certified cashier's
check for the balance of his payments.
SELLER PLEASE NOTE
Upon termination of Seller's insurance at closing, Seller should
insure all personal property remaining on the premises prior to
delivery of possession.
Purchase Agreement Addendum
Notwithstanding anything in the Purchase Agreement to the
contrary, Buyer shall be allowed ten (10) days after receipt of
said commitment for examination and the making of any
objections thereto, said objections to be made in writing or
deemed waived. If any objections are so made, the Seller shall
be allowed one hundred twenty (120) days to make such title
marketable or in the alternative to obtain a commitment for
insurable title notwithstanding 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. Seller shall pay for the cost of issuing the title
commitment and Buyer shall pay the owner's title insurance
premium for an Owner's policy.
Seller shall provide Buyer access to the Property from
time to time for the purpose of conducting inspections thereof
including mechanical, structural, electrical and other physical
inspections. Buyer has until April 5, 1996 to complete such
physical inspection.
Buyer shall indemnify Seller from and against any and all
losses, claims, causes of action, liabilities, and costs to the
extent caused by the actions of Buyer, its agents, employees,
contractors, or invitees, during any such entry upon the
Property. The foregoing duty of indemnification shall include
the duty to pay all reasonable attorney's fees incurred by the
Seller in responding to or defending any such claims or
proceedings.
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 inspection period. Such notice shall be deemed effective
only upon receipt by Seller.
DISCLAIMER. Seller and Buyer acknowledge and agree that
Seller acquired the Property through a sale/leaseback with a
former tenant. Seller has been an absentee landlord.
Consequently, Seller has little, if any, knowledge of the
physical characteristics of the Property.
Accordingly, except as otherwise specifically stated in
this Agreement, Seller hereby specifically disclaims any
warranty, guaranty, or representation, oral or written, past,
present, or future of, as to, or concerning (i) the nature and
condition of the Property, including, without limitation, the
water, soil, and geology, and the suitability thereof and of
the Property for any and all activities and uses which Buyer
may elect to conduct thereon; (ii) except for the warranty of
title contained in the Deed to be delivered by Seller at the
Closing, the nature and extent of any right of way, Lease,
possession, lien, encumbrance, license, reservation, condition,
or otherwise, and (iii) the compliance of the Property or its
operation with any laws, ordinances, or regulations of any
government or other body.
Buyer acknowledges that having been given the opportunity
to inspect the Property, Buyer is relying solely on its own
investigation of the Property and not on any information
provided or to be provided by Seller except as set forth
herein. Buyer further acknowledges that the information
provided and to be provided with respect to the Property by
Seller 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.
BUYER AGREES THAT IT SHALL BE PURCHASING THE PROPERTY IN
ITS THEN PRESENT CONDITION, AS IS, WHERE IS, AND SELLER HAS NO
OBLIGATION TO CONSTRUCT OR REPAIR ANY IMPROVEMENTS THEREON, OR
TO PERFORM ANY OTHER ACT REGARDING THE PROPERTY. WITHOUT
LIMITING THE GENERALITY OF THE FOREGOING, BUYER ALSO AGREES
THAT SELLER WILL HAVE NO LIABILITY OF ANY TYPE, DIRECT OR
INDIRECT, TO BUYER OR BUYER'S SUCCESSORS, ASSIGNS, LENDERS OR
AFFILIATES IN CONNECTION WITH ANY HAZARDOUS, TOXIC, DANGEROUS,
FLAMMABLE, EXPLOSIVE OR CHEMICAL SUBSTANCE OF ANY TYPE (WHETHER
OR NOT DEFINED AS SUCH UNDER ANY APPLICABLE LAWS) ON OR IN
CONNECTION WITH THE PROPERTY EITHER BEFORE OR AFTER THE CLOSING
DATE.
SELLER: AEI REAL ESTATE FUND 86-A LIMITED PARTNERSHIP,
By: AEI Fund Management 86-A, Inc., its corporate
general partner
By: /s/ Mark E. Larson
(Robert P. Johnson, President signed by different
/s/ Its CFO coporate officer text has
a line through it)
BUYER:
By: /s/ Mark H. Meyer
/s/ David L. Meyer
ASSIGNMENT
OF
PURCHASER'S INTEREST IN PURCHASE AGREEMENT
THIS ASSIGNMENT made and entered into this 23rd day of
April, 1996, by and between Mark H. Meyer and David L. Meyer
(collectively "Assignor") and Sports West, LLC, a Nebraska
limited liability company, ("Assignee");
WITNESSETH, that:
WHEREAS, on the 20th day of March, 1996, Assignor entered
into a Purchase Agreement, as amended by Amendment to
Purchase Agreement dated April 10, 1996 (the "Purchase
Agreement") for that certain property located at 2501-30th
Avenue located in Kearney, Nebraska (the "Property") with
AEI Real Estate Fund 86-A Limited Partnership, a Minnesota
limited partnership, as Seller/Lessee; and
WHEREAS, Assignor desires to assign all of its rights, title
and interest in, to and under the Purchase Agreement to
Assignee as hereinafter provided;
NOW, THEREFORE, for One Dollar ($1.00) and other good and
valuable consideration, receipt of which is hereby
acknowledged, it is hereby agreed between the parties as
follows:
1. Assignor assigns all of its rights, title and
interest in, to and under the Purchase Agreement to
Assignee, to have and to hold the same unto the Assignee,
its successors and assigns;
2. Assignee hereby assumes all rights, promises,
covenants, conditions and obligations under the Purchase
Agreement to be performed by the Assignor thereunder, and
agrees to be bound for all of the obligations of Assignor
under the Commitment.
All other terms and conditions of the Purchase Agreement
shall remain unchanged and continue in full force and
effect.
"ASSIGNOR"
/s/ M H Meyer
Mark H. Meyer
/s/ David L Meyer
David L. Meyer
"ASSIGNEE"
SPORTS WEST, LLC
By: /s/ M H Meyer
Its: /s/ Pres
