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: September 30, 1996
Commission file number: 0-18289
AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
(Exact Name of Small Business Issuer as Specified in its Charter)
State of Minnesota 41-1622463
(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)
(612) 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 REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
INDEX
PART I. Financial Information
Item 1. Balance Sheet as of September 30, 1996 and December 31, 1995
Statements for the Periods ended September 30, 1996 and 1995:
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 REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
BALANCE SHEET
SEPTEMBER 30, 1996 AND DECEMBER 31, 1995
(Unaudited)
ASSETS
1996 1995
CURRENT ASSETS:
Cash and Cash Equivalents $ 1,693,243 $ 2,332,974
Receivables 22,325 43,389
----------- -----------
Total Current Assets 1,715,568 2,376,363
----------- -----------
INVESTMENTS IN REAL ESTATE:
Land 5,823,496 5,370,160
Buildings and Equipment 11,939,200 11,065,109
Property Acquisition Costs 0 8,798
Accumulated Depreciation (2,163,523) (1,932,655)
----------- -----------
Net Investments in Real Estate 15,599,173 14,511,412
----------- -----------
Total Assets $17,314,741 $16,887,775
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Payable to AEI Fund Management, Inc. $ 42,960 $ 49,968
Distributions Payable 323,827 406,381
Security Deposit 31,010 0
Unearned Rent 50,160 5,000
----------- -----------
Total Current Liabilities 447,957 461,349
----------- -----------
MINORITY INTEREST 525,472 76,319
PARTNERS' CAPITAL (DEFICIT):
General Partners (30,059) (29,971)
Limited Partners, $1,000 Unit value;
30,000 Units authorized; 22,783 issued;
22,078 Units outstanding 16,371,371 16,380,078
----------- -----------
Total Partners' Capital 16,341,312 16,350,107
----------- -----------
Total Liabilities and Partners' Capital $17,314,741 $16,887,775
=========== ===========
The accompanying Notes to Financial Statements are an integral
part of this statement.
</PAGE>
<PAGE>
AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
STATEMENT OF INCOME
FOR THE PERIODS ENDED SEPTEMBER 30
(Unaudited)
Three Months Ended Nine Months Ended
9/30/96 9/30/95 9/30/96 9/30/95
INCOME:
Rent $ 419,358 $ 407,631 $1,233,721 $1,381,664
Investment Income 25,781 21,072 79,671 22,567
--------- --------- ---------- ---------
Total Income 445,139 428,703 1,313,392 1,404,231
--------- --------- ---------- ---------
EXPENSES:
Partnership Administration -
Affiliates 63,639 61,155 184,882 189,630
Partnership Administration
and Property Management -
Unrelated Parties 40,749 25,254 140,096 69,123
Interest 0 0 0 6,115
Depreciation 108,398 107,670 319,797 342,051
--------- --------- --------- ---------
Total Expenses 212,786 194,079 644,775 606,919
--------- --------- --------- ---------
OPERATING INCOME 232,353 234,624 668,617 797,312
GAIN ON SALE OF REAL ESTATE 90,156 570,853 344,461 570,853
MINORITY INTEREST IN NET
INCOME (13,081) (2,007) (20,795) (6,020)
--------- --------- --------- ---------
NET INCOME $ 309,428 $ 803,470 $ 992,283 $1,362,145
========= ========= ========= =========
NET INCOME ALLOCATED:
General Partners $ 3,094 $ 8,035 $ 9,923 $ 13,621
Limited Partners 306,334 795,435 982,360 1,348,524
--------- --------- --------- ---------
$ 309,428 $ 803,470 $ 992,283 $1,362,145
========= ========= ========= =========
NET INCOME PER
LIMITED PARTNERSHIP UNIT
(22,078 and 22,234 weighted average
Units outstanding in 1996
and 1995 respectively) $ 13.87 $ 35.77 $ 44.49 $ 60.65
========= ========= ========= =========
The accompanying Notes to Financial Statements are an integral
part of this statement.
</PAGE>
<PAGE>
AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
STATEMENT OF CASH FLOWS
FOR THE PERIODS ENDED SEPTEMBER 30
(Unaudited)
1996 1995
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 992,283 $ 1,362,145
Adjustments to Reconcile Net Income to Net Cash
Provided by Operating Activities:
Depreciation 319,797 342,051
Gain on Sale of Real Estate (344,461) (570,853)
Decrease in Receivables 21,064 19,949
Decrease in Payable to
AEI Fund Management, Inc. (7,008) (18,931)
Increase (Decrease) in Security Deposit 31,010 (50,000)
Increase in Unearned Rent 45,160 44,233
Minority Interest (5,795) (1,293)
----------- -----------
Total Adjustments 59,767 (234,844)
----------- -----------
Net Cash Provided By
Operating Activities 1,052,050 1,127,301
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Investments in Real Estate (1,911,639) 0
Proceeds from Sale of Real Estate - Net of
Minority Interest 1,303,490 2,704,142
----------- -----------
Net Cash Provided By (Used For)
Investing Activities (608,149) 2,704,142
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Increase (Decrease) in Distributions Payable (82,554) 59,272
Distributions to Partners (1,001,078) (1,380,780)
----------- -----------
Net Cash Used For
Financing Activities (1,083,632) (1,321,508)
----------- -----------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS (639,731) 2,509,935
CASH AND CASH EQUIVALENTS, beginning of period 2,332,974 103,469
----------- -----------
CASH AND CASH EQUIVALENTS, end of period $ 1,693,243 $ 2,613,404
=========== ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest Paid During the Period $ 0 $ 6,115
=========== ============
The accompanying Notes to Financial Statements are an integral
part of this statement.
</PAGE>
<PAGE>
AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
STATEMENT OF CHANGES IN PARTNERS' CAPITAL
FOR THE PERIODS ENDED SEPTEMBER 30
(Unaudited)
Limited
Partnership
General Limited Units
Partners Partners Total Outstanding
BALANCE, December 31, 1994 $ (27,119) $16,662,415 $16,635,296 22,233.80
Distributions (13,808) (1,366,972) (1,380,780)
Net Income 13,621 1,348,524 1,362,145
--------- ----------- ----------- -----------
BALANCE, September 30, 1995 $ (27,306) $16,643,967 $16,616,661 22,233.80
========= =========== =========== ===========
BALANCE, December 31, 1995 $ (29,971) $16,380,078 $16,350,107 22,077.80
Distributions (10,011) (991,067) (1,001,078)
Net Income 9,923 982,360 992,283
--------- ----------- ----------- -----------
BALANCE, September 30, 1996 $ (30,059) $16,371,371 $16,341,312 22,077.80
========= =========== =========== ===========
The accompanying Notes to Financial Statements are an integral
part of this statement.
</PAGE>
AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
(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 Real Estate Fund XVIII Limited Partnership (Partnership)
was formed to acquire and lease commercial properties to
operating tenants. The Partnership's operations are managed
by AEI Fund Management XVIII, Inc. (AFM), the Managing
General Partner of the Partnership. Robert P. Johnson, the
President and sole shareholder of AFM, serves as the
Individual General Partner of the Partnership. An affiliate
of AFM, AEI Fund Management, Inc., 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 February 15, 1989 when minimum
subscriptions of 1,500 Limited Partnership Units
($1,500,000) were accepted. The Partnership's offering
terminated December 4, 1990 when the extended offering
period expired. The Partnership received subscriptions for
22,783.05 Limited Partnership Units ($22,783,050).
Under the terms of the Limited Partnership Agreement, the
Limited Partners and General Partners contributed funds of
$22,783,050, and $1,000, respectively. During the operation
of the Partnership, any Net Cash Flow, as defined, which the
General Partners determine to distribute will be distributed
90% to the Limited Partners and 10% to the General Partners;
provided, however, that such distributions to the General
Partners will be subordinated to the Limited Partners first
receiving an annual, noncumulative distribution of Net Cash
Flow equal to 10% of their Adjusted Capital Contribution, as
defined, and, provided further, that in no event will the
General Partners receive less than 1% of such Net Cash Flow
per annum. Distributions to Limited Partners will be made
pro rata by Units.
AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(2) Organization - (Continued)
Any Net Proceeds of Sale, as defined, from the sale or
financing of the Partnership's 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 6% of their Adjusted Capital Contribution
per annum, cumulative but not compounded, to the extent not
previously distributed from Net Cash Flow; (ii) next, 99% to
the Limited Partners and 1% to the General Partners until
the Limited Partners receive an amount equal to 14% of their
Adjusted Capital Contribution per annum, cumulative but not
compounded, to the extent not previously distributed; (iii)
next, to the General Partners until cumulative distributions
to the General Partners under Items (ii) and (iii) equal 15%
of cumulative distributions to all Partners under Items (ii)
and (iii). Any remaining balance will be distributed 85% to
the Limited Partners and 15% to the General Partners.
Distributions to the Limited Partners will be made pro rata
by Units.
For tax purposes, profits from operations, other than
profits attributable to the sale, exchange, financing,
refinancing or other disposition of the Partnership's
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 90% to the Limited Partners and 10% to the General
Partners. In the event no Net Cash Flow is distributed to
the Limited Partners, 90% of each item of Partnership
income, gain or credit for each respective year shall be
allocated to the Limited Partners, and 10% of each such item
shall be allocated to the General Partners. Net losses from
operations will be allocated 98% to the Limited Partners and
2% to the General Partners.
For tax purposes, profits arising from the sale, financing,
or other disposition of the Partnership's 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 14% of their Adjusted Capital
Contributions per annum, cumulative but not compounded, to
the extent not previously allocated; (iii) third, to the
General Partners until cumulative allocations to the General
Partners equal 15% of cumulative allocations. Any remaining
balance will be allocated 85% to the Limited Partners and
15% 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.
AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(3) Investments in Real Estate -
In 1995, the Partnership elected early adoption of the
Statement of Financial Accounting Standards No. 121,
"Accounting for Impairment of Long-Lived Assets and for Long-
Lived Assets to be Disposed Of." This standard requires the
Partnership to compare the carrying amount of its properties
to the estimated future cash flows expected to result from
the property and its eventual disposition. If the sum of
the expected future cash flows is less than the carrying
amount of the property, the Statement requires the
Partnership to recognize an impairment loss by the amount by
which the carrying amount of the property exceeds the fair
value of the property. Adoption of this Statement is not
expected to have a material effect on the Partnership's
financial statements.
The Partnership owns a 4.1022% interest in a Sizzler
restaurant in Cincinnati, Ohio, a 93.2478% interest in a
Sizzler restaurant in Springboro, Ohio, and a 100% interest
in a Sizzler restaurant in Fairfield, Ohio. In January,
1994 and June, 1994, the Partnership closed the restaurants
in Cincinnati and Springboro, respectively, and listed them
for sale or lease. While the properties are being re-leased
or sold, the Partnership is responsible for the real estate
taxes and other costs required to maintain the properties.
On July 15, 1994, the Partnership re-leased the Sizzler in
Fairfield to Fairfield Foods, Inc. (Fairfield) under a Lease
Agreement with a primary term of 20 years and annual rental
payments based on a percentage of sales. Fairfield was not
able to profitably operate the restaurant and closed the
restaurant. The Partnership is reviewing the available
options, which include selling or re-leasing the property.
No rents were collected from the Sizzler restaurants in the
first nine months of 1996 and 1995. The total amount of
rent not collected in 1996 and 1995 was $296,145 and
$287,519, respectively, for the three properties. These
amounts were not accrued for financial reporting purposes.
In August, 1995, the lessee of the two Rally's properties
filed for reorganization. After reviewing the operating
results of the lessee, the Partnership agreed to amend the
Leases of the two properties. Effective December 1, 1995,
the Partnership amended the Leases to reduce the base rent
from the current annual rent of $47,498 and $48,392 to
$15,000 for each property. The Partnership could receive
additional rent in the future equal to 6.5% of the amount by
which gross receipts exceed $275,000. The lessee has agreed
to pay all post-petition rents due and the Partnership's
related administrative and legal expenses. The Partnership
is owed $29,128 of pre-petition rent, which was not accrued
for financial reporting purposes due to the uncertainty of
collection.
On July 6, 1995, the Partnership sold the Cheddar's
restaurant in Columbus, Ohio, to the lessee. The
Partnership received net sale proceeds of $1,259,320, which
resulted in a net gain of $105,291. At the time of sale,
the cost and related accumulated depreciation was $1,306,191
and $152,162, respectively.
On September 1, 1995, the Partnership sold the Applebee's
restaurant in Memphis, Tennessee, to the lessee. The
Partnership received net sale proceeds of $1,444,822, which
resulted in a net gain of $465,562. At the time of sale,
the cost and related accumulated depreciation was $1,126,919
and $147,659, respectively.
AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(3) Investments in Real Estate - (Continued)
During the first nine months of 1996 and the year 1995, the
Partnership distributed $123,465 and $691,021 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 $5.53 and $30.90 per Limited
Partnership Unit, respectively. The majority of the
remaining net proceeds were reinvested in additional
properties.
On April 10, 1996, the Partnership purchased an 85.0%
interest in a Tractor Supply Company store in Bristol,
Virginia for $1,094,367. The property is leased to Tractor
Supply Company under a Lease Agreement with a primary term
of 14 years and annual rental payments of $116,686. The
remaining interest in the property was purchased by the
Individual General Partner of the Partnership.
On August 29, 1996, the Partnership purchased a 32.2%
interest in a Champp's Americana restaurant in Columbus,
Ohio for $826,070. The property is leased to Americana
Dining Corporation under a Lease Agreement with a primary
term of 20 years and annual rental payments of $90,834. The
remaining interest in the property was purchased by AEI
Income & Growth Fund XXI Limited Partnership, an affiliate
of the Partnership.
On May 10, 1996, the Partnership sold the Taco Cabana
restaurant in New Braunfels, Texas to an unrelated third
party. The Partnership received net sale proceeds of
$962,297, which resulted in a net gain of $254,305. At the
time of sale, the cost and related accumulated depreciation
of the property was $784,044 and $76,052, respectively.
On August 5, 1996, the Partnership sold a 13.7546% interest
in a Taco Cabana restaurant in San Antonio, Texas to an
unrelated third party. The Partnership received net sale
proceeds of $217,260 which resulted in a net gain of
$70,396. The cost and related accumulated depreciation of
the interest sold was $158,441 and $11,577, respectively.
On September 12, 1996, the Partnership sold an 8.4209%
interest in the Tractor Supply store in Bristol, Virginia to
an unrelated third party. The Partnership received net sale
proceeds of $123,933 which resulted in a net gain of
$16,621. The cost and related accumulated depreciation of
the interest sold was $108,418 and $1,106, respectively.
On October 15, 1996, the Partnership sold an additional
10.6316% interest in the Taco Cabana restaurant in San
Antonio, Texas to an unrelated third party. The Partnership
received net sale proceeds of approximately $177,000 which
resulted in a net gain of approximately $64,000.
On October 15, 1996, the Partnership sold an additional
9.9069% interest in the Tractor Supply store in Bristol,
Virginia to an unrelated third party. The Partnership
received net sale proceeds of approximately $151,000 which
resulted in a net gain of approximately $25,000.
AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(3) Investments in Real Estate - (Continued)
The Partnership owns the above properties and the Applebee's
restaurant in Destin, Florida, as tenants-in-common with
unrelated third parties. The management of the properties
is governed by co-tenancy agreements between the Partnership
and the unrelated third parties, which grant the Partnership
the authority to control the management of the properties.
For properties owned as tenants-in-common with third
parties, other than affiliated partnerships, the Partnership
accounts for its interest under the full consolidation
method whereby the unrelated third parties' interests in the
properties are reflected in the Partnership's financial
statements as a minority interest.
Pursuant to the Partnership Agreement, net sale proceeds may
be reinvested in additional properties until a date five
years after the date on which the offer and sale of Units is
terminated. This period expired on December 4, 1995. As a
result, the Managing General Partner is in the process of
preparing a proxy statement to propose an amendment to the
Limited Partnership Agreement that would allow the
Partnership to reinvest the majority of the sale proceeds
from the sales of the Taco Cabana restaurants and Tractor
Supply Store in additional properties.
(4) Payable to AEI Fund Management -
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.
(5) Security Deposit -
In February, 1996, the Partnership called a letter of credit
for $109,393 related to the Taco Cabana restaurant in
Brownsville, Texas. The Partnership applied a portion of
the funds to satisfy rents and real estate taxes due. As of
September 30, 1996, the Partnership was holding $31,010 as a
security deposit until the lessee renews the letter of
credit.
(6) Line of Credit -
In September, 1994, the Partnership established a $150,000
unsecured line of credit at Fidelity Bank of Edina,
Minnesota. On January 5, 1995, the line of credit was
increased to $300,000. The line of credit bears interest at
the prime rate plus one percent on the outstanding balance,
which is due on demand, but in any event no later than
January 5, 1996. The line of credit was established to
provide short-term financing to cover any temporary cash
deficits. In January, 1996, the line of credit expired. In
the first nine months of 1995, interest expense related to
the line of credit was $6,115.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
Results of Operations
For the nine months ended September 30, 1996 and 1995, the
Partnership recognized rental income of $1,233,721 and
$1,381,664, respectively. During the same periods, the
Partnership earned investment income of $79,671 and $22,567,
respectively. In 1996, rental income decreased mainly as a
result of the property sales and Rally's situation discussed
below. The decrease in rental income was partially offset by
rental income received from two subsequent property acquisitions,
rent increases on fourteen properties and additional investment
income earned on the net proceeds from the property sales.
The Partnership owns a 4.1022% interest in a Sizzler
restaurant in Cincinnati, Ohio, a 93.2478% interest in a Sizzler
restaurant in Springboro, Ohio, and a 100% interest in a Sizzler
restaurant in Fairfield, Ohio. In January, 1994 and June, 1994,
the Partnership closed the restaurants in Cincinnati and
Springboro, respectively, and listed them for sale or lease.
While the properties are being re-leased or sold, the Partnership
is responsible for the real estate taxes and other costs required
to maintain the properties.
On July 15, 1994, the Partnership re-leased the Sizzler in
Fairfield to Fairfield Foods, Inc. (Fairfield) under a Lease
Agreement with a primary term of 20 years and annual rental
payments based on a percentage of sales. Fairfield was not able
to profitably operate the restaurant and closed the restaurant.
The Partnership is reviewing the available options, which include
selling or re-leasing the property.
No rents were collected from the Sizzler restaurants in
the first nine months of 1996 and 1995. The total amount of rent
not collected in 1996 and 1995 was $296,145 and $287,519,
respectively, for the three properties. These amounts were not
accrued for financial reporting purposes.
In August, 1995, the lessee of the two Rally's properties
filed for reorganization. After reviewing the operating results
of the lessee, the Partnership agreed to amend the Leases of the
two properties. Effective December 1, 1995, the Partnership
amended the Leases to reduce the base rent from the current
annual rent of $47,498 and $48,392 to $15,000 for each property.
The Partnership could receive additional rent in the future equal
to 6.5% of the amount by which gross receipts exceed $275,000.
The lessee has agreed to pay all post-petition rents due and the
Partnership's related administrative and legal expenses. The
Partnership is owed $29,128 of pre-petition rent, which was not
accrued for financial reporting purposes due to the uncertainty
of collection.
In February, 1996, the Partnership called a letter of
credit for $109,393 related to the Taco Cabana restaurant in
Brownsville, Texas. The Partnership applied a portion of the
funds to satisfy rents and real estate taxes due. As of
September 30, 1996, the Partnership was holding $31,010 as a
security deposit until the lessee renews the letter of credit.
During the nine months ended September 30, 1996 and 1995,
the Partnership paid Partnership administration expenses to
affiliated parties of $184,882 and $189,630, 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 periods, the Partnership incurred Partnership
administration and property management expenses from unrelated
parties of $140,096 and $69,123, 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. The increase
in these expenses in 1996, when compared to the same period in
1995, is the result of expenses incurred in 1996 related to the
Sizzler situation discussed above.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued)
As of September 30, 1996, the Partnership's annualized
cash distribution rate was 6.0%, based on the Adjusted Capital
Contribution. Distributions of Net Cash Flow to the General
Partners were subordinated to the Limited Partners as required in
the Partnership Agreement. As a result, 99% of distributions and
income were allocated to Limited Partners and 1% to the General
Partners.
Inflation has had a minimal effect on income from
operations. It is expected that increases in sales volumes of
the tenants due to inflation and real sales growth, 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 nine months ended September 30, 1996, the
Partnership's cash balances decreased $639,731 mainly as the
result of investing activities. Net income before depreciation
and gain on sale decreased by approximately $166,000 in the
first nine months of 1996, when compared to the same period in
1995. This was due to a decrease in revenues as a result of the
property sales discussed below and an increase in expenses in
1996. This decrease was partially offset by net timing
differences in the collection of payments from the lessees and
the payment of expenses so that net cash provided by operating
activities decreased by only $75,251 from 1995 to 1996.
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. In the nine months ended September
30, 1996, the Partnership generated cash flow from the sale of
real estate, as discussed below, of $1,303,490. During the same
period, the Partnership expended $1,911,639 to invest in real
properties (inclusive of acquisition expenses) as the Partnership
reinvested the cash generated from the property sales.
On July 6, 1995, the Partnership sold the Cheddar's
restaurant in Columbus, Ohio, to the lessee. The Partnership
received net sale proceeds of $1,259,320, which resulted in a net
gain of $105,291. At the time of sale, the cost and related
accumulated depreciation was $1,306,191 and $152,162,
respectively.
On September 1, 1995, the Partnership sold the Applebee's
restaurant in Memphis, Tennessee, to the lessee. The Partnership
received net sale proceeds of $1,444,822, which resulted in a net
gain of $465,562. At the time of sale, the cost and related
accumulated depreciation was $1,126,919 and $147,659,
respectively.
During the first nine months of 1996 and the year 1995,
the Partnership distributed $123,465 and $691,021 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 $5.53 and $30.90 per Limited Partnership Unit,
respectively. The majority of the remaining net proceeds were
reinvested in additional properties.
On April 10, 1996, the Partnership purchased an 85.0%
interest in a Tractor Supply Company store in Bristol, Virginia
for $1,094,367. The property is leased to Tractor Supply Company
under a Lease Agreement with a primary term of 14 years and
annual rental payments of $116,686. The remaining interest in
the property was purchased by the Individual General Partner of
the Partnership.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued)
On August 29, 1996, the Partnership purchased a 32.2%
interest in a Champp's Americana restaurant in Columbus, Ohio for
$826,070. The property is leased to Americana Dining Corporation
under a Lease Agreement with a primary term of 20 years and
annual rental payments of $90,834. The remaining interest in the
property was purchased by AEI Income & Growth Fund XXI Limited
Partnership, an affiliate of the Partnership.
On May 10, 1996, the Partnership sold the Taco Cabana
restaurant in New Braunfels, Texas to an unrelated third party.
The Partnership received net sale proceeds of $962,297, which
resulted in a net gain of $254,305. At the time of sale, the
cost and related accumulated depreciation of the property was
$784,044 and $76,052, respectively.
On August 5, 1996, the Partnership sold a 13.7546%
interest in a Taco Cabana restaurant in San Antonio, Texas to an
unrelated third party. The Partnership received net sale
proceeds of $217,260 which resulted in a net gain of $70,396.
The cost and related accumulated depreciation of the interest
sold was $158,441 and $11,577, respectively.
On September 12, 1996, the Partnership sold an 8.4209%
interest in the Tractor Supply store in Bristol, Virginia to an
unrelated third party. The Partnership received net sale
proceeds of $123,933 which resulted in a net gain of $16,621.
The cost and related accumulated depreciation of the interest
sold was $108,418 and $1,106, respectively.
On October 15, 1996, the Partnership sold an additional
10.6316% interest in the Taco Cabana restaurant in San Antonio,
Texas to an unrelated third party. The Partnership received net
sale proceeds of approximately $177,000 which resulted in a net
gain of approximately $64,000.
On October 15, 1996, the Partnership sold an additional
9.9069% interest in the Tractor Supply store in Bristol, Virginia
to an unrelated third party. The Partnership received net sale
proceeds of approximately $151,000 which resulted in a net gain
of approximately $25,000.
The Partnership owns the above properties and the
Applebee's restaurant in Destin, Florida, as tenants-in-common
with unrelated third parties. The management of the properties
is governed by co-tenancy agreements between the Partnership and
the unrelated third parties, which grant the Partnership the
authority to control the management of the properties. For
properties owned as tenants-in-common with third parties, other
than affiliated partnerships, the Partnership accounts for its
interest under the full consolidation method whereby the
unrelated third parties' interests in the properties are
reflected in the Partnership's financial statements as a minority
interest.
Pursuant to the Partnership Agreement, net sale proceeds
may be reinvested in additional properties until a date five
years after the date on which the offer and sale of Units is
terminated. This period expired on December 4, 1995. As a
result, the Managing General Partner is in the process of
preparing a proxy statement to propose an amendment to the
Limited Partnership Agreement that would allow the Partnership to
reinvest the majority of the sale proceeds from the sales of the
Taco Cabana restaurants and Tractor Supply Store in additional
properties.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued)
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 in the fourth quarter of each
year. The redemption payments generally are funded with cash
that would normally be paid as part of the regular quarterly
distributions. As a result, total distributions and
distributions payable have fluctuated from year to year due to
cash used to fund redemption payments. In the first nine months
of 1995, the Partnership made distributions at an 8.0% rate which
resulted in distributions to the Partners of $1,380,780.
Effective January 1, 1996, the distribution rate was reduced to
6.0% which resulted in distributions of $1,001,078 to the
Partners for the first nine months of 1996.
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 October 1, 1996, fifteen Limited Partners redeemed a
total of 313.42 Partnership Units for $233,227 in accordance with
the Partnership Agreement. The Partnership acquired these Units
using Net Cash Flow from operations. In prior years, a total of
forty-six Limited Partners redeemed 705 Partnership Units for
$602,632. The redemptions increase the remaining Limited
Partners' ownership interest in the Partnership.
In September, 1994, the Partnership established a $150,000
unsecured line of credit at Fidelity Bank of Edina, Minnesota.
On January 5, 1995, the line of credit was increased to $300,000.
The line of credit bears interest at the prime rate plus one
percent on the outstanding balance, which is due on demand, but
in any event no later than January 5, 1996. The line of credit
was established to provide short-term financing to cover any
temporary cash deficits. In January, 1996, the line of credit
expired. In the first nine months of 1995, interest expense
related to the line of credit was $6,115.
The continuing rent payments from the properties, together
with cash generated from the property sales, should be adequate
to fund continuing distributions and meet other Partnership
obligations on both a short-term and long-term basis.
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.
PART II - OTHER INFORMATION
(Continued)
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits -
Description
10.1 Purchase Agreement dated
July 23, 1996 between the Partnership and
Carolyn W. Davidson relating to the
property at 6867 Highway 90 West, San
Antonio, Texas.
10.2 Property Co-tenancy
Ownership Agreement dated August 5, 1996
between the Partnership and Carolyn W.
Davidson relating to the property at 6867
Highway 90 West, San Antonio, Texas.
10.3 Purchase Agreement dated
August 23, 1996 between the Partnership,
Robert P. Johnson, and Joyce R. Scott
relating to the property at Old Airport
Road and I-81, Bristol, Virginia.
10.4 Property Co-tenancy
Ownership Agreement dated September 12,
1996 between the Partnership, Robert P.
Johnson, and Joyce R. Scott relating to
the property at Old Airport Road and I-
81, Bristol, Virginia.
10.5 Purchase Agreement dated
October 9, 1996 between the Partnership,
Robert P. Johnson, and Arel D. and Louise
B. Middleton relating to the property at
Old Airport Road and I-81, Bristol,
Virginia.
10.6 Purchase Agreement dated
October 9, 1996 between the Partnership
and Arel D. and Louise B. Middleton
relating to the property at 6867 Highway
90 West, San Antonio, Texas.
10.7 Property Co-tenancy
Ownership Agreement dated October 15,
1996 between the Partnership, Robert P.
Johnson, and Arel D. and Louise B.
Middleton relating to the property at Old
Airport Road and I-81, Bristol, Virginia.
10.8 Property Co-tenancy
Ownership Agreement dated October 15,
1996 between the Partnership and Arel D.
and Louise B. Middleton relating to the
property at 6867 Highway 90 West, San
Antonio, Texas.
27 Financial Data Schedule
for period ended September 30, 1996.
PART II - OTHER INFORMATION
(Continued)
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (Continued)
b. Reports filed on Form 8-K -
During the quarter ended September
30, 1996, the Partnership filed a
Form 8-K, dated September 12, 1996,
reporting the acquisition of the
Champp's restaurant in Columbus,
Ohio.
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: November 14, 1996 AEI Real Estate Fund XVIII
Limited Partnership
By: AEI Fund Management XVIII, 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
Taco Cabana, San Antonio, TX
This AGREEMENT, entered into effective as of the 23rd of July,
1996 .
l. Parties. Seller is AEI Real Estate Fund XVIII Limited
Partnership ("Seller"), Seller presently holds 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 the Carolyn W. Davidson ("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 13.7546% percentage interest
(hereinafter, simply the "Property") as Tenant in Common and in
all improvements located on the Entire Property.
3. Purchase Price . The purchase price for this percentage
interest in the Property is $250,000 all cash.
4. Terms. The purchase price for the Property will be paid by
Buyer as follows:
Buyer will deposit the purchase price, $250,000, into escrow
in sufficient time to allow escrow to close on the closing
date.
5 Closing Date. Escrow shall close on or before August 2, 1996.
6 . Due Diligence. Buyer will have until the expiration of the
fifth business day 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.
(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 Property done
concurrent with Seller's acquisition of the Property.
(d) Lease 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 Initial: /s/ CWD
Purchase Agreement for Taco Cabana - San Antonio, TX
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
any review period or inspection period. Such notice shall be
deemed effective only upon receipt by Seller.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under sections 15(a) 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.
Buyer irrevocably will be deemed to have canceled this
Agreement and relinquish all rights in and to the Property unless
Buyer makes the Second Payment when required. 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; and other items of record
disclosed to Buyer during the contingency 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
Buyer Initial: /s/ CWD
Purchase Agreement for Taco Cabana - San Antonio, TX
pay the cost of issuing a Standard Owners Title Insurance Policy
in the full amount of the purchase price. 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 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. 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 therafter, 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 shall
of all operating expenses of the 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 lease in existence between Seller and
Taco Cabana, Inc., dated July 19, 1991 which was assigned to
Texas Taco Cabana LP pursuant to the General Assignment and
Assumption of Leases between Taco Cabana, Inc. and TC Lease
Holdings III, V and VI, Inc. dated October 31, 1993 and
pursuant to the General Assignment and Assumption of Leases
between TC Lease Holding III V and VI, Inc. and Texas Taco
Cabana LP dated October 31, 1993 and pursuant to the
Consents and Acknowledgments Concerning Net Lease Agreements
between Taco Cabana, Inc. and AEI Real Estate Fund XVIII
Limited Partnership dated June 2, 1994, Seller is not aware
of any leases of the Property. A copy of the above
referenced documents is incorporated herein as "Exhibit "B".
(ii) It is not aware of any pending litigation or
condemnation proceedings against the Property or Seller's
interest in the Property.
Buyer Initial: /s/ CWD
Purchase Agreement for Taco Cabana - San Antonio, TX
(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.
(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 such Hazardous Materials on or in connection with the
Property arising out of Seller's negligence or intentional
misconduct in violation of applicable state or federal law
or regulation.
(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
Buyer Initial: /s/ CWD
Purchase Agreement for Taco Cabana - San Antonio, TX
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.
13. Closing.
(a) Before the closing date, Seller will deposit into
escrow an executed warranty deed conveying insurable title
of the Property to Buyer.
(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. 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
Buyer Initial: /s/ CWD
Purchase Agreement for Taco Cabana - San Antonio, TX
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.
(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
be 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 five-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.
Buyer Initial: /s/ CWD
Purchase Agreement for Taco Cabana - San Antonio, TX
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 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 JOHN HARRIS who will act
as Facilitator to perfect the 1031 exchange by preparing an
agreement of exchange of Real Property whereby JOHN HARRIS 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 to cooperate in the perfection of such an exchange at
no additional cost or expense 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 JOHN HARRIS, 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 13 days following the
delivery of the notice to the escrow agent. Within three
Buyer Initial: /s/ CWD
Purchase Agreement for Taco Cabana - San Antonio, TX
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.
(b) If this escrow has not closed by August 2, 1996 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 Real Estate Fund XVIII Limited Partnership
1300 Minnesota World Trade Center
30 E. 7th Street
St. Paul, MN 55101
If to Buyer:
Carolyn W. Davidson
4407 Ortega Forest Drive
Jacksonville, FL 32210
Buyer Initial: /s/ CWD
Purchase Agreement for Taco Cabana - San Antonio, TX
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.
IN WITNESS WHEREOF, the Seller and Buyer have executed this
Agreement effective as of the day and year above first written.
BUYER: Carolyn W. Davidson
By: /s/ Carolyn W. Davidson
Carolyn W. Davidson
SELLER: AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP, a
Minnesota limited partnership.
By: AEI Fund Management XVIII, Inc., its corporate general partner
By: /s/ Robert P. Johnson
Robert P. Johnson, President
Buyer Initial: /s/ CWD
Purchase Agreement for Taco Cabana - San Antonio, TX
EXHIBIT A
Legal Description
Lot 31, Block 1, New City Block 15600, CKE Subdivision, Unit
3, an addition to the City of San Antonio, Bexar County,
Texas, according to the map or plat thereof, recorded in
Volume 9504, Page 182, Deed and Plat Records of Bexar
County, Texas.
PROPERTY CO-TENANCY
OWNERSHIP AGREEMENT
(Taco Cabana - San Antonio, TX)
THIS CO-TENANCY AGREEMENT,
Made and entered into as of the 5th day of Aug, 1996, by and
between The Carolyn W. Davidson (hereinafter called "Davidson"),
and AEI Real Estate Fund XVIII Limited Partnership (hereinafter
called "Fund XVIII") (Davidson, Fund XVIII (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 XVIII presently owns an undivided 86.2454% interest
in and to, and Davidson presently owns and undivided 13.7546%
interest in and to the land, situated in the City of San Antonio,
County of Bexar, and State of Texas, (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 Davidson's interest
by Fund XVIII; 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 Davidson 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 XVIII, or its designated agent, successors or
assigns. Provided, however, if Fund XVIII shall sell all of its
interest in the Premises, the duties and obligations of Fund
XVIII 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 XVIII 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 XVIII as their sole and
exclusive agent to deal with any property agent and to execute
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 of all present or future Co-
Tenants. Only Fund XVIII may obligate any Co-Tenant with respect
to any expense for the Premises.
As further set forth in paragraph 2 hereof, Fund XVIII agrees to
require any lessee of the Premises to name Davidson as an insured
or additional insured in all insurance policies provided for, or
contemplated by, any lease on the Premises. Fund XVIII 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 XVIII 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.
Co-Tenant Initial: /s/ CWD
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
2. Income, expenses and any net proceeds from a sale of the
Premises 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 XVIII may offset against, pay to
itself and deduct from any payment due to Davidson under this
Agreement, and may pay to itself the amount of Davidson's share
of any legitimate expenses of the Premises which are not paid by
Davidson to Fund XVIII or its assigns, within ten (10) days after
demand by Fund XVIII. In the event there is insufficient
operating income from which to deduct Davidson's unpaid share of
operating expenses, Fund XVIII 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
Lessee under terms of any triple net lease agreement initiated
concurrently with, or subsequent to, this agreement.
Davidson has elected to retain, and agrees to annually reimburse,
Fund XVIII in the amount of $744 for the expenses, direct and
indirect, incurred by Fund XVIII in providing quarterly
accounting and distributions of Davidson's share of net income
and for tracking, reporting and assessing the calculation of
Davidson's share of operating expenses incurred from the
Premises. This invoice amount shall be pro-rated for partial
years and Davidson authorizes Fund XVIII to deduct such amount
from Davidson's share of revenue. Davidson may terminate this
agreement at any time and collect it's share of rental stream
directly from the tenant.
3. Full, accurate and complete books of account shall be kept
in accordance with generally accepted accounting principles at
Fund XVIII'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 XVIII
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, Davidson
shall be entitled to receive 13.7546% of all items of income and
expense generated by the Premises, and Fund XVIII shall be
entitled to receive 86.2454% as its share. 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 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 XVIII, shall,
within fifteen (15) business days after receipt of notice, make
payment to Fund XVIII 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.
Co-Tenant Initial: /s/ CWD
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
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
the expiration date plus extensions of the net lease agreement
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 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 deemed
given or served in accordance with the provisions of this
Agreement, if said notice or elections addressed as follows;
If to Fund XVIII:
AEI Real Estate Fund XVIII Limited Partnership
1300 Minnesota World Trade Center
30 E. Seventh Street
St. Paul, Minnesota 55101
If to Davidson:
Carolyn W. Davidson
4407 Ortega Forest Drive
Jacksonville, FL 32210
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.
10. 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.
11. 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.
Co-Tenant Initial: /s/ CWD
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
12. 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.
IN WITNESS WHEREOF, The parties hereto have caused this Agreement
to be executed and delivered, as of the day and year first above
written.
Davidson Carolyn W. Davidson
By: /s/ Carolyn W. Davidson
Carolyn W. Davidson
Witness By: /s/ Paul E. Davidson Jr
STATE OF )
) ss [notary seal]
COUNTY OF )
The foregoing instrument was acknowledged before me, a
Notary Public in and for the County and State aforesaid,
this 23rd day of July ,1996, by John B. Linge, Jr, Notary
Public. /s/ John B. Linge Jr.
Fund XVIII AEI Real Estate Fund XVIII Limited Partnership
By: AEI Fund Management XVIII, Inc.,
its corporate general partner
By: /s/ Robert P. Johnson
Robert P. Johnson, President
Witness By: /s/ Laura M. Steidl
Witness By: /s/ Gertrude L. Ornberg
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 5th day of August,
1996, Robert P. Johnson, President of AEI Fund Management XVIII,
Inc., corporate general partner of AEI Real Estate Fund XVIII
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/ CWD
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
Exhibit A
Legal Description
Lot 31, Block 1, New City Block 15600, CKE Subdivision, Unit 3,
an addition to the City of San Antonio, Bexar County, Texas,
according to the map or plat thereof, recorded in Volume 9504,,
Page 182, Deed and Plat Records of Bexar County, Texas.
PURCHASE AGREEMENT
Tractor Supply Company Store - Bristol, VA
This AGREEMENT, entered into effective as of the 23 of August,
1996 .
l. Parties. Seller is AEI Real Estate Fund XVIII Limited
Partnership which currently owns an undivided 85.00% interest in
the fee title to that certain real property legally described in
the attached Exhibit "A" (the "Entire Property") and Robert P.
Johnson which currently owns an undivided 15.00% interest in the
Entire Property (also referred to herein as "Seller"), Buyer is
Joyce R. Scott ("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 9.9069 (Fund XVIII selling 8.4209%
interest and Robert P. Johnson selling 1.4860% interest)
percentage interest (hereinafter, simply the "Property") as
Tenant in Common and in all improvements located on the Entire
Property.
3. Purchase Price . The purchase price for this percentage
interest in the Property is $170,000, all cash. $144,500 payable
to AEI Real Estate Fund XVIII Limited Partnership and $25,500
payable to Robert P. Johnson.
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 (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,
$165,000 (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 September 12,
1996.
6 . Due Diligence. Buyer will have until the expiration of the
fifth business day 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.
(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 Property done
concurrent with Seller's acquisition of the Property.
(d) Lease 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.
Buyer Initial: /s/ JS
Purchase Agreement for Tractor Supply - Bristol, VA
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
any review period or inspection period. Such notice shall be
deemed effective only upon receipt by Seller.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under sections 15(a) 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.
Buyer irrevocably will be deemed to have canceled this
Agreement and relinquish all rights in and to the Property unless
Buyer makes the Second Payment when required. 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; and other items of record
disclosed to Buyer during the contingency 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.
Buyer Initial: /s/ JS
Purchase Agreement for Tractor Supply - Bristol, VA
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. 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 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. 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 therafter, 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 shall
of all operating expenses of the 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 lease in existence between Rober P.
Johnson and AEI Real Estate Fund XVIII Limited Partnership
and Tractor Supply Company, dated April 10th, 1996, 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.
Buyer Initial: /s/ JS
Purchase Agreement for Tractor Supply - Bristol, VA
(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.
(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 such Hazardous Materials on or in connection with the
Property arising out of Seller's negligence or intentional
misconduct in violation of applicable state or federal law
or regulation.
(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.
Buyer Initial: /s/ JS
Purchase Agreement for Tractor Supply - Bristol, VA
(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.
13. Closing.
(a) Before the closing date, Seller will deposit into
escrow an executed warranty deed conveying insurable title
of the Property to Buyer.
(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. 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
Buyer Initial: /s/ JS
Purchase Agreement for Tractor Supply - Bristol, VA
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.
(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
be 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 five-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
Buyer Initial: /s/ JS
Purchase Agreement for Tractor Supply - Bristol, VA
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 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 Starker Services, Inc. who
will act as Facilitator to perfect the 1031 exchange by preparing
an agreement of exchange of Real Property whereby Starker
Services, 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. Buyer asks the Seller to cooperate in the perfection
of such an exchange at no additional cost or expense 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 Starker Services, Inc., 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 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
Buyer Initial: /s/ JS
Purchase Agreement for Tractor Supply - Bristol, VA
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.
(b) If this escrow has not closed by September 12, 1996
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 Real Estate Fund XVIII Limited Partnership
1300 Minnesota World Trade Center
30 E. 7th Street
St. Paul, MN 55101
If to Buyer:
Joyce R. Scott
1562 Rainbow Drive
Santa Ana, CA 92705
Buyer Initial: /s/ JS
Purchase Agreement for Tractor Supply - Bristol, VA
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.
IN WITNESS WHEREOF, the Seller and Buyer have executed this
Agreement effective as of the day and year above first written.
BUYER: Joyce R. Scott
By: /s/ Joyce R. Scott
Joyce R. Scott
SELLER: AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP, a
Minnesota limited partnership.
By: AEI Fund Management XVIII, Inc.,
its corporate general partner
By: /s/ Robert P. Johnson
Robert P. Johnson, President
SELLER: ROBERT P. JOHNSON
By: /s/ Robert P. Johnson
Robert P. Johnson
Buyer Initial:
Purchase Agreement for Tractor Supply - Bristol, VA
EXHIBIT A
A certain tract of land, containing 2.74 acres, more or
less, situated, lying, and being in the City of Bristol and
in the County of Washington, State of Virginia, as described
by metes and bounds as follows:
Located in Washington County and the City of Bristol,
Virginia within the Wal-mart Shopping Center Development;
being a portion of Tract No. 8 (Wal-Mart Stores, Inc.) as
shown on Plat of Record in Plat Book 4, Page 63k, in the
recorders office for Washington County, Virginia; being more
particularly described as follows:
BEGINNING at an iron pin corner to Walnut Grove Church
and Tract 5 of the Wal-Mart Development, thence proceeding
with the line of Walnut Grove Church North 86 degrees 02
minutes 35 seconds West for a distance of 337.57 feet to an
iron pin set this survey; thence leaving the line of Walnut
Grove Church and proceeding with a new line North 46 degrees
10 minutes 34 seconds East for a distance of 591.56 feet ot
an iron pin set this survey in the line of Tract 7; said
iron pin being on the south side of said road South 43
degrees 49 minutes 26 seconds East for a distance of 250.00
feet to an iron pin set this survey and corner to Tract 5;
thence with the line of Tract 5 South 46 degrees 10 minutes
34 seconds West for a distance of 364.723 feet to the
BEGINNING, containing 2.74 acres more or less as surveyed by
Frizzell Engineering July, 1995.
A part of, buy NOT all of Tract No. 8 of the subdivision of
the Wal-Mart Shopping Center as shown on a plat dated April
20, 1993 which plat is of record in the Office of the Clerk
of the Circuit Court of Washington County, Virginia in Plat
Book 28, pages 42 through 45, and in records of the City of
Bristol in Plat Book 4, pages 60 through 63, to which plat
reference is hereto made for a more particular description.
TOGETHER WITH a non-exclusive easement for the use of the
drive lanes, as set forth in Easements With covenants And
Restrictions Affecting Land ("ECR") by and between Wal-Mart
Stores, Inc., a Delaware corporation and Lowe's Home Center,
Inc., a North Carolina corporation, dated November 16, 1993,
recorded in the Clerk's Office, Circuit Court, County of
Washington, Virginia, in Deed Book 888, page 345.
BEING a portion of the same real estate conveyed to Tractor
Supply Company, a Tennessee corporation by deed from Wal-
Mart Stores, Inc., a Delaware corporation, dated October 2,
1995, recorded November 29, 1995, recorded in the Clerk's
Office, Circuit Court, County of Washington, Virginia, in
Deed Book 931, page 231, and in the Clerk's Office, Circuit
Court, City of Bristol, Virginia, in Deed Book 329, page 19.
PROPERTY CO-TENANCY
OWNERSHIP AGREEMENT
(Tractor Supply Company Store - Bristol, VA)
THIS CO-TENANCY AGREEMENT,
Made and entered into as of the 12th day of Sept, 1996, by and
between Joyce R. Scott, (hereinafter called "Scott"), and AEI
Real Estate Fund XVIII Limited Partnership (hereinafter called
"Fund XVIII") (Scott, Fund XVIII (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 XVIII presently owns an undivided 76.5791% interest
in and to, and Scott presently owns and undivided 9.9069%
interest in and to, and Robert P. Johnson presently owns an
undivided 13.5140% interest in and to the land, situated in the
City of Bristol, County of Washington, and State of VA, (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 Scott's interest by
Fund XVIII; 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 Scott 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 XVIII, or its designated agent, successors or
assigns. Provided, however, if Fund XVIII shall sell all of its
interest in the Premises, the duties and obligations of Fund
XVIII 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 XVIII 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 XVIII as their sole and
exclusive agent to deal with any property agent and to execute
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 of all present or future Co-
Tenants. Only Fund XVIII may obligate any Co-Tenant with respect
to any expense for the Premises.
As further set forth in paragraph 2 hereof, Fund XVIII agrees to
require any lessee of the Premises to name Scott as an insured or
additional insured in all insurance policies provided for, or
contemplated by, any lease on the Premises. Fund XVIII 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 XVIII 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.
Co-Tenant Initial: /s/ JS
Co-Tenancy Agreement for Tractor Supply - Bristol, VA
2. Income, expenses and any net proceeds from a sale of the
Premises 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 XVIII may offset against, pay to
itself and deduct from any payment due to Scott under this
Agreement, and may pay to itself the amount of Scott's share of
any legitimate expenses of the Premises which are not paid by
Scott to Fund XVIII or its assigns, within ten (10) days after
demand by Fund XVIII. In the event there is insufficient
operating income from which to deduct Scott's unpaid share of
operating expenses, Fund XVIII 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
Lessee under terms of any triple net lease agreement initiated
concurrently with, or subsequent to, this agreement.
Scott has elected to retain, and agrees to annually reimburse,
Fund XVIII in the amount of $475 for the expenses, direct and
indirect, incurred by Fund XVIII in providing quarterly
accounting and distributions of Scott's share of net income and
for tracking, reporting and assessing the calculation of Scott's
share of operating expenses incurred from the Premises. This
invoice amount shall be pro-rated for partial years and Scott
authorizes Fund XVIII to deduct such amount from Scott's share of
revenue. Scott may terminate this agreement at any time and
collect it's share of rental stream directly from the tenant.
3. Full, accurate and complete books of account shall be kept
in accordance with generally accepted accounting principles at
Fund XVIII'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 XVIII
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, Scott shall
be entitled to receive 9.9069% of all items of income and expense
generated by the Premises, and Fund XVIII shall be entitled to
receive 76.5791% as its share. 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 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 XVIII, shall,
within fifteen (15) business days after receipt of notice, make
payment to Fund XVIII 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.
Co-Tenanat Initial: /s/ JS
Co-Tenancy Agreement for Tractor Supply - Bristol, VA
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
the expiration date plus extensions of the net lease agreement
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 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 deemed
given or served in accordance with the provisions of this
Agreement, if said notice or elections addressed as follows;
If to Fund XVIII:
AEI Real Estate Fund XVIII Limited Partnership
1300 Minnesota World Trade Center
30 E. Seventh Street
St. Paul, Minnesota 55101
If to Scott:
Joyce R. Scott
1562 Rainbow Drive
Santa Ana, CA 92705
If to Middleton:
Arel D. Louise B. Middleton
P.O. Box 283
Wasco, OR 97065-0283
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.
Co-Tenant Initial: /s/ JS
Co-Tenancy Agreement for Tractor Supply - Bristol, VA
10. 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.
11. 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.
12. 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.
IN WITNESS WHEREOF, The parties hereto have caused this Agreement
to be executed and delivered, as of the day and year first above
written.
Scott Joyce R. Scott
By: /s/ Joyce R. Scott
Joyce R. Scott
STATE OF )
) ss [notary seal]
COUNTY OF )
The foregoing instrument was acknowledged before me, a
Notary Public in and for the County and State aforesaid,
this 23 day of August, 1996, by Lilly Klein, Notary
Public. /s/ Lilly Klein
Fund XVIII AEI Real Estate Fund XVIII Limited Partnership
By: AEI Fund Management XVIII, Inc., its corporate
general partner
By: /s/ Robert P. Johnson
Robert P. Johnson, President
Witness By: /s/ Laura M. Steidl
Witness By: /s/ Kelly Kae Schueller
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 12th day of
September, 1996, Robert P. Johnson, President of AEI Fund
Management XVIII, Inc., corporate general partner of AEI Real
Estate Fund XVIII 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/ JS
Co-Tenancy Agreement for Tractor Supply - Bristol, VA
EXHIBIT A LEGAL DESCRIPTION
A certain tract of land, containing 2.74 acres, more or less,
situated, lying, and being in the City of Bristol and in the
County of Washington, State of Virginia, as described by metes
and bounds as follows:
Located in Washington County and the City of Bristol,
Virginia within the Wal-mart Shopping Center Development; being a
portion of Tract No. 8 (Wal-Mart Stores, Inc.) as shown on Plat
of Record in Plat Book 4, Page 63, in the recorders office for
Washington County, Virginia; being more particularly described as
follows:
BEGINNING at an iron pin corner to Walnut Grove Church and
Tract 5 of the Wal-Mart Development, thence proceeding with the
line of Walnut Grove Church North 86 degrees 02 minutes 35
seconds West for a distance of 337.57 feet to an iron pin set
this survey; thence leaving the line of Walnut Grove Church and
proceeding with a new line North 46 degrees 10 minutes 34 seconds
East for a distance of 591.56 feet to an iron pin set this survey
in the line of Tract 7; said iron pin being on the south side of
said road South 43 degrees 49 minutes 26 seconds East for a
distance of 250.00 feet to an iron pin set this survey and corner
to Tract 5; thence with the line of Tract 5 South 46 degrees 10
minutes 34 seconds West for a distance of 364.723 feet to the
Beginning, containing 2.74 acres more or less as surveyed by
Frizzell Engineering July, 1995.
A part of, by NOT all of Tract No. 8 of the subdivision of the
Wal-Mart Shopping Center as shown on a plat dated April 20, 1993
which plat is of record in the Office of the Clerk of The Circuit
court of Washington County, Virginia in Plat Book 28, pages 42
through 45, and in records of the City of Bristol I plat Book 4,
pages 60 through 63, to which plat reference is hereto made for a
more particular description.
TOGETHER WITH a non-exclusive easement for the use of the drive
lanes, as set forth in Easements With Covenants And Restrictions
Affecting Land ("ECR") by and between Wal-Mart Stores, Inc., a
Delaware corporation and Lowe's Home Center, Inc., a North
Carolina corporation, dated November 16, 1993, recorded in the
Clerk's Office, Circuit Court, County of Washington, Virginia, in
Deed Book 888, page 345.
BEING a portion of the same real estate conveyed to Tractor
Supply Company, a Tennessee corporation by deed from Wal-Mart
Stores, Inc., a Delaware corporation, dated October 2, 1995,
recorded November 29, 1995, recorded in the Clerk's Office,
Circuit Court, County of Washington, Virginia, in Deed Book 931,
page 231, and in the Clerk's Office, Circuit Court, City of
Bristol, Virginia, in Deed Book 329, page 19.
PURCHASE AGREEMENT
Tractor Supply Company Store - Bristol, VA
This AGREEMENT, entered into effective as of the 9th of Oct, 1996.
l. Parties. Seller is AEI Real Estate Fund XVIII Limited
Partnership which currently owns an undivided 76.5791% interest
in the fee title to that certain real property legally descrbed
in the attached Exhibit "A" (the "Entire Property") and Robert P.
Johnson which currently owns an undivided 13.5140% interest in
the Entire Property (also referred to herein as "Seller"). Buyer
is Arel D. and Louise B. Middleton, married with rights of
survivorship ("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 11.6552% (Fund XVIII selling 9.9069% and
Robert Johnson selling 1.7483%) percentage interest (hereinafter,
simply the "Property") as Tenant in Common in the Property.
3. Purchase Price . The purchase price for this percentage
interest in the Property is $200,000 all cash. $170,000 payable
to Fund XVIII and $30,000 payable to Robert P. Johnson.
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 (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,
$195,000 (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 October 15,
1996.
6 . Due Diligence. Buyer will have until the expiration of the
fifth business day 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.
(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 Property done
concurrent with Seller's acquisition of the Property.
Buyer Initial: /s/ ADM /s/ L.B.M.
Purchase Agreement for Tractor Supply - Bristol, VA
(d) Lease 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
any review period or inspection period. Such notice shall be
deemed effective only upon receipt by Seller.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under sections 15(a) 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.
Buyer irrevocably will be deemed to have canceled this
Agreement and relinquish all rights in and to the Property unless
Buyer makes the Second Payment when required. 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; and other items of record
disclosed to Buyer during the contingency 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
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Tractor Supply - Bristol, VA
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. 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 isrequired 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 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. 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 therafter, 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 shall
of all operating expenses of the 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 lease in existence between Seller and
Tractor Supply Company, dated April 10th, 1996, 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.
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Tractor Supply - Bristol, VA
(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.
(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 such Hazardous Materials on or in connection with the
Property arising out of Seller's negligence or intentional
misconduct in violation of applicable state or federal law
or regulation.
(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
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Tractor Supply - Bristol, VA
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.
13. Closing.
(a) Before the closing date, Seller will deposit into
escrow an executed warranty deed conveying insurable title
of the Property to Buyer.
(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. 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
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Tractor Supply - Bristol, VA
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.
(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
be 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 five-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.
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Tractor Supply - Bristol, VA
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 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 who will
act as Facilitator to perfect the 1031 exchange by preparing an
agreement of exchange of Real Property whereby
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 to cooperate in the perfection of such an
exchange at no additional cost or expense 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 , 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 13 days following the
delivery of the notice to the escrow agent. Within three
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Tractor Supply - Bristol, VA
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.
(b) If this escrow has not closed by October 15, 1996
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 Real Estate Fund XVIII Limited Partnership
1300 Minnesota World Trade Center
30 E. 7th Street
St. Paul, MN 55101
If to Buyer:
Arel D. and Louise B. Middleton
P.O. Box 283
Wasco, OR 97065-0283
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Tractor Supply - Bristol, VA
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.
IN WITNESS WHEREOF, the Seller and Buyer have executed this
Agreement effective as of the day and year above first written.
BUYER: Arel D. and Louise B. Middleton
By: /s/ Arel D. Middleton
Arel D. Middleton
By: /s/ Louise B. Middleton
Louise B. Middleton
SELLER: AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP, a
Minnesota limited partnership.
By: AEI Fund Management XVIII, Inc.,
its corporate general partner
By: /s/ Robert P. Johnson
Robert P. Johnson, President
SELLER: ROBERT P. JOHNSON
By: /s/ Robert P. Johnson
Robert P. Johnson
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Tractor Supply - Bristol, VA
EXHIBIT A LEGAL DESCRIPTION
A certain tract of land, containing 2.74 acres, more or less,
situated, lying, and being in the City of Bristol and in the
County of Washington, State of Virginia, as described by metes
and bounds as follows:
Located in Washington County and the City of Bristol,
Virginia within the Wal-mart Shopping Center Development; being a
portion of Tract No. 8 (Wal-Mart Stores, Inc.) as shown on Plat
of Record in Plat Book 4, Page 63, in the recorders office for
Washington County, Virginia; being more particularly described as
follows:
BEGINNING at an iron pin corner to Walnut Grove Church and
Tract 5 of the Wal-Mart Development, thence proceeding with the
line of Walnut Grove church North 86 degrees 02 minutes 35
seconds West for a distance of 337.57 feet to an iron pin set
this survey; thence leaving the line of Walnut Grove Church and
proceeding with a new line North 46 degrees 10 minutes 34 seconds
East for a distance of 591.56 feet to an iron pin set this survey
in the line of Tract 7; said iron pin being on the south side of
said road South 43 degrees 49 minutes 26 seconds East for a
distance of 250.00 feet to an iron pin set this survey and corner
to Tract 5; thence with the line of Tract 5 South 46 degrees 10
minutes 34 seconds West for a distance of 364.723 feet to the
BEGINNING, containing 2.74 acres more or less as surveyed by
Frizzell Engineering July, 1995.
A part of, but NOT all of Tract No. 8 of the subdivision of the
Wal-Mart Shopping Center as shown on a plat dated April 20, 1993
which plat is of record in the Office of the Clerk of the Circuit
Court of Washington County, Virginia in Plat Book 28, pages 42
through 45 and in records of the City of Bristol in Plat Book 4,
pages 60 through 63, to which plat reference is hereto made for a
more particular description.
TOGETHER WITH a non-exclusive easement for the use of the drive
lanes, as set forth in Easements With Covenants And Restrictions
Affecting Land ("ECR") by and between Wal-Mart Stores, Inc., a
Delaware corporation and Lowe's Home Center, Inc., a North
Carolina corporation, dated November 16, 1993, recorded in the
Clerk's Office,, Circuit Court, County of Washington, Virginia,
in Deed Book 888, page 345.
BEING a portion of the same real estate conveyed to Tractor
Supply Company, a Tennessee corporation by deed from Wal-Mart
Stores, Inc., a Delaware corporation, dated October 2, 1995,
recorded November 29, 1995, recorded in the Clerk's Office,
Circuit Court, County of Washington, Virginia, in Deed book 931,
page 231, and in the Clerk's Office, Circuit Court, City of
Bristol, Virginia, in Deed Book 329, page 19.
PURCHASE AGREEMENT
Taco Cabana, San Antonio, TX
This AGREEMENT, entered into effective as of the 9th of Oct, 1996.
l. Parties. Seller is AEI Real Estate Fund XVIII Limited
Partnership ("Seller"), Seller presently holds 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 Arel D. and Louise B. Middleton ("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 10.6316% percentage interest
(hereinafter, simply the "Property") as Tenant in Common and in
all improvements located on the Entire Property.
3. Purchase Price . The purchase price for this percentage
interest in the Property is $200,000 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 (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,
$195,000 (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 October 15,
1996.
6 . Due Diligence. Buyer will have until the expiration of the
fifth business day 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.
(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 Property done
concurrent with Seller's acquisition of the Property.
(d) Lease 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.
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Taco Cabana - San Antonio, TX
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
any review period or inspection period. Such notice shall be
deemed effective only upon receipt by Seller.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under sections 15(a) 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.
Buyer irrevocably will be deemed to have canceled this
Agreement and relinquish all rights in and to the Property unless
Buyer makes the Second Payment when required. 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; and other items of record
disclosed to Buyer during the contingency 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.
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Taco Cabana - San Antonio, TX
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. 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 isrequired 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 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. 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 therafter, 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 shall
of all operating expenses of the 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 lease in existence between Seller and
Taco Cabana, Inc., dated July 19, 1991 which was assigned to
Texas Taco Cabana LP pursuant to the General Assignment and
Assumption of Leases between Taco Cabana, Inc. and TC Lease
Holdings III, V and VI, Inc. dated October 31, 1993 and
pursuant to the General Assignment and Assumption of Leases
between TC Lease Holding III V and VI, Inc. and Texas Taco
Cabana LP dated October 31, 1993 and pursuant to the
Consents and Acknowledgments Concerning Net Lease Agreements
between Taco Cabana, Inc. and AEI Real Estate Fund XVIII
Limited Partnership dated June 2, 1994, Seller is not aware
of any leases of the Property. A copy of the above
referenced documents is incorporated herein as "Exhibit "B".
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Taco Cabana - San Anotnio, TX
(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.
(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 such Hazardous Materials on or in connection with the
Property arising out of Seller's negligence or intentional
misconduct in violation of applicable state or federal law
or regulation.
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Taco Cabana - San Antonio, TX
(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.
13. Closing.
(a) Before the closing date, Seller will deposit into
escrow an executed warranty deed conveying insurable title
of the Property to Buyer.
(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. 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
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Taco Cabana - San Antonio, TX
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.
(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
be 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 five-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
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Taco Cabana - San Antonio, Tx
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 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 who will
act as Facilitator to perfect the 1031 exchange by preparing an
agreement of exchange of Real Property whereby 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 to cooperate in the perfection of such an exchange at
no additional cost or expense 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 , 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
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Taco Cabana - San Antonio, TX
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.
(b) If this escrow has not closed by October 15, 1996
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 Real Estate Fund XVIII Limited Partnership
1300 Minnesota World Trade Center
30 E. 7th Street
St. Paul, MN 55101
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Taco Cabana - San Antonio, TX
If to Buyer:
Arel D. and Louis B. Middleton
P.O. Box 283
Wasco, OR 97065-0283
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.
IN WITNESS WHEREOF, the Seller and Buyer have executed this
Agreement effective as of the day and year above first written.
BUYER: AREL D. AND LOUISE B. MIDDLETON
By: /s/ Arel D. Middleton
Arel D. Middleton
By: /s/ Louise B. Middleton
Louise B. Middleton
SELLER: AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP, a
Minnesota limited partnership.
By: AEI Fund Management XVIII, Inc.,
its corporate general partner
By: /s/ Robert P. Johnson
Robert P. Johnson, President
Buyer Initial: /s/ ADM /s/ LBM
Purchase Agreement for Taco Cabana - San Antonio, TX
Exhibit A
Legal Description
Lot 31, Block 1, New City Block 15600, CKE Subdivision,, Unit 3,
an addition to the City of San Antonio, Bexar County, Texas,
according to the map or plat thereof, recorded in Volume 9504,
Page 182, Deed and Plat Records of Bexar County, Texas.
PROPERTY CO-TENANCY
OWNERSHIP AGREEMENT
(Tractor Supply Company Store - Bristol, VA)
THIS CO-TENANCY AGREEMENT,
Made and entered into as of the 15th day of Oct, 1996, by and
between Arel D. and Louise B. Middleton, (hereinafter called
"Middleton"), and AEI Real Estate Fund XVIII Limited Partnership
(hereinafter called "Fund XVIII") (Middleton, Fund XVIII (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 XVIII presently owns an undivided 66.6722% interest
in and to, and Middleton presently owns and undivided 11.6552%
interest in and to, and Joyce R. Scott presently owns an
undivided 9.9069% interest (also referred to herein as Co-Tenant)
in and to, and Robert P. Johnson presently owns an undivided
11.7657% interest (also referred to herein as Co-Tenant) in and
to the land, situated in the City of Bristol, County of
Washington, and State of VA, (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 Middleton's interest
by Fund XVIII; 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 Middleton 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 XVIII, or its designated agent, successors or
assigns. Provided, however, if Fund XVIII shall sell all of its
interest in the Premises, the duties and obligations of Fund
XVIII 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 XVIII 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 XVIII as their sole and
exclusive agent to deal with any property agent and to execute
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 of all present or future Co-
Tenants. Only Fund XVIII may obligate any Co-Tenant with respect
to any expense for the Premises.
As further set forth in paragraph 2 hereof, Fund XVIII agrees to
require any lessee of the Premises to name Middleton as an
insured or additional insured in all insurance policies provided
for, or contemplated by, any lease on the Premises. Fund XVIII
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 XVIII shall
distribute any insurance proceeds it
Co-Tenant Initial: /s/ ADM /s/ LBM
Co-Tenancy Agreement for Tractor Supply - Bristol, VA
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, expenses and any net proceeds from a sale of the
Premises 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 XVIII may offset against, pay to
itself and deduct from any payment due to Middleton under this
Agreement, and may pay to itself the amount of Middleton's share
of any legitimate expenses of the Premises which are not paid by
Middleton to Fund XVIII or its assigns, within ten (10) days
after demand by Fund XVIII. In the event there is insufficient
operating income from which to deduct Middleton's unpaid share of
operating expenses, Fund XVIII 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
Lessee under terms of any triple net lease agreement initiated
concurrently with, or subsequent to, this agreement.
Middleton has elected to retain, and agrees to annually
reimburse, Fund XVIII in the amount of $595 for the expenses,
direct and indirect, incurred by Fund XVIII in providing
quarterly accounting and distributions of Middleton's share of
net income and for tracking, reporting and assessing the
calculation of Middleton's share of operating expenses incurred
from the Premises. This invoice amount shall be pro-rated for
partial years and Middleton authorizes Fund XVIII to deduct such
amount from Middleton's share of revenue. Middleton may terminate
this agreement at any time and collect it's share of rental
stream directly from the tenant.
3. Full, accurate and complete books of account shall be kept
in accordance with generally accepted accounting principles at
Fund XVIII'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 XVIII
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, Middleton
shall be entitled to receive 11.6552% of all items of income and
expense generated by the Premises, and Fund XVIII shall be
entitled to receive 66.6722% as its share. 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 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 XVIII, shall,
within fifteen (15) business days after receipt of notice, make
payment to Fund XVIII 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-
Co-Tenant Initial: /s/ ADM /s/ LBM
Co-Tenancy Agreement for Tractor Supply - Bristol, VA
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
the expiration date plus extensions of the net lease agreement
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 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 deemed
given or served in accordance with the provisions of this
Agreement, if said notice or elections addressed as follows;
If to Fund XVIII:
AEI Real Estate Fund XVIII Limited Partnership
1300 Minnesota World Trade Center
30 E. Seventh Street
St. Paul, Minnesota 55101
If to Middleton:
Arel D. and Louise B. Middleton
P.O. Box 283
Wasco, OR 97065-0283
If to Scott:
Joyce R. Scott
1562 Rainbow Drive
Santa Ana, CA 92705
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.
Co-Tenant Initial: /s/ ADM /s/ LBM
Co-Tenancy Agreement for Tractor Supply - Bristol, VA
10. 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.
11. 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.
12. 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/ ADM /s/ LBM
Co-Tenancy Agreement for Tractor Supply - Bristol, VA
IN WITNESS WHEREOF, The parties hereto have caused this Agreement
to be executed and delivered, as of the day and year first above
written.
Middleton Arel D. and Louis B. Middleton
By: /s/ Arel D. Middleton /s/ Arel D. Middleton
Arel D. Middleton
By: /s/ Louise B. Middleton /s/ Louise B. Middleton
Louise B. Middleton
STATE OF )
) ss
COUNTY OF ) [notary seal]
The foregoing instrument was acknowledged before me, a
Notary Public in and for the County and State aforesaid,
this 12 day of October, 1996, by /s/ Linda Cornie, Notary
Public.
Fund XVIII AEI Real Estate Fund XVIII Limited Partnership
By: AEI Fund Management XVIII, Inc.,
its corporate general partner
By: /s/ Robert P. Johnson
Robert P. Johnson, President
Witness By: /s/ Laura Steidl
Witness By: /s/ Kelly Schueller
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 15th day of October,
1996, Robert P. Johnson, President of AEI Fund Management XVIII,
Inc., corporate general partner of AEI Real Estate Fund XVIII
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/ Catherine A. Davis [notary seal]
Notary Public
Co-Tenant Initial: /s/ ADM /s/ LBM
Co-Tenancy Agreement for Tractor Supply - Bristol, VA
EXHIBIT A LEGAL DESCRIPTION
A certain tract of land, containing 2.74 acres, more or less,
situated, lying, and being in the City of Bristol and in the
County of Washington, State of Virginia, as described by metes
and bounds as follows:
Located in Washington County and the City of Bristol,
Virginia within the Wal-Mart Shopping Center Development; being a
portion of Tract No. 8 (Wal-Mart Stores, Inc.) as shown on Plat
of Record in Plat Book 4, Page 63, in the recorders office for
Washington County, Virginia; being more particularly described as
follows:
BEGINNING at an iron pin corner to Walnut Grove Church and
Tract 5 of the Wal-Mart Development, thence proceeding with the
line of Walnut Grove church North 86 degrees 02 minutes 35
seconds West for a distance of 337.57 feet to an iron pin set
this survey; thence leaving the line of Walnut Grove Church and
proceeding with a new line North 46 degrees 10 minutes 34 seconds
East for a distance of 591.56 feet to an iron pin set this survey
in the line of Tract 7; said iron pin being on the south side of
said road South 43 degrees 49 minutes 26 seconds East for a
distance of 250.00 feet to an iron pin set this survey and corner
to Tract 5; thence with the line of Tract 5 South 46 degrees 10
minutes 34 seconds West for a distance of 364.723 feet to the
BEGINNING, containing 2.74 acres more or less as surveyed by
Frizzell Engineering July, 1995.
A part of, but NOT all of Tract No. 8 of the subdivision of the
Wal-Mart Shopping Center as shown on a plat dated April 20, 1993
which plat is of record in the Office of the Clerk of the Circuit
Court of Washington County, Virginia in Plat Book 28, pages 42
through 45 and in records of the City of Bristol in Plat Book 4,
pages 60 through 63, to which plat reference is hereto made for a
more particular description.
TOGETHER WITH a non-exclusive easement for the use of the drive
lanes, as set forth in Easements With Covenants And Restrictions
Affecting Land ("ECR") by and between Wal-Mart Stores, Inc., a
Delaware corporation and Lowe's Home Center, Inc., a North
Carolina corporation, dated November 16, 1993, recorded in the
Clerk's Office,, Circuit Court, County of Washington, Virginia,
in Deed Book 888, page 345.
BEING a portion of the same real estate conveyed to Tractor
Supply Company, a Tennessee corporation by deed from Wal-Mart
Stores, Inc., a Delaware corporation, dated October 2, 1995,
recorded November 29, 1995, recorded in the Clerk's Office,
Circuit Court, County of Washington, Virginia, in Deed book 931,
page 231, and in the Clerk's Office, Circuit Court, City of
Bristol, Virginia, in Deed Book 329, page 19.
PROPERTY CO-TENANCY
OWNERSHIP AGREEMENT
(Taco Cabana - San Antonio, TX)
THIS CO-TENANCY AGREEMENT,
Made and entered into as of the 15th day of Oct, 1996, by and
between Arel D. and Louise B. Middleton (hereinafter called
"Middleton"), and AEI Real Estate Fund XVIII Limited Partnership
(hereinafter called "Fund XVIII") (Middleton, Fund XVIII (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 XVIII presently owns an undivided 75.6138% interest
in and to, and Middleton presently owns and undivided 10.6316%
interest in and to, and Carolyn W. Davidson presently owns an
undivided 13.7546% interest (also referred to herein as Co-
Tenant) in and to the land, situated in the City of San Antonio,
County of Bexar, and State of Texas, (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 Middleton's interest
by Fund XVIII; 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 Middleton 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 XVIII, or its designated agent, successors or
assigns. Provided, however, if Fund XVIII shall sell all of its
interest in the Premises, the duties and obligations of Fund
XVIII 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 XVIII 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 XVIII as their sole and
exclusive agent to deal with any property agent and to execute
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 of all present or future Co-
Tenants. Only Fund XVIII may obligate any Co-Tenant with respect
to any expense for the Premises.
As further set forth in paragraph 2 hereof, Fund XVIII agrees to
require any lessee of the Premises to name Middleton as an
insured or additional insured in all insurance policies provided
for, or contemplated by, any lease on the Premises. Fund XVIII
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 XVIII shall
distribute any insurance proceeds it
Co-Tenant Initial: /s/ ADM /s/ LBM
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
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, expenses and any net proceeds from a sale of the
Premises 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 XVIII may offset against, pay to
itself and deduct from any payment due to Middleton under this
Agreement, and may pay to itself the amount of Middleton's share
of any legitimate expenses of the Premises which are not paid by
Middleton to Fund XVIII or its assigns, within ten (10) days
after demand by Fund XVIII. In the event there is insufficient
operating income from which to deduct Middleton's unpaid share of
operating expenses, Fund XVIII 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
Lessee under terms of any triple net lease agreement initiated
concurrently with, or subsequent to, this agreement.
Middleton has elected to retain, and agrees to annually
reimburse, Fund XVIII in the amount of $595 for the expenses,
direct and indirect, incurred by Fund XVIII in providing
quarterly accounting and distributions of Middleton's share of
net income and for tracking, reporting and assessing the
calculation of Middleton's share of operating expenses incurred
from the Premises. This invoice amount shall be pro-rated for
partial years and Middleton authorizes Fund XVIII to deduct such
amount from Middleton's share of revenue. Middleton may terminate
this agreement at any time and collect it's share of rental
stream directly from the tenant.
3. Full, accurate and complete books of account shall be kept
in accordance with generally accepted accounting principles at
Fund XVIII'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 XVIII
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, Middleton
shall be entitled to receive 10.6316% of all items of income and
expense generated by the Premises, and Fund XVIII shall be
entitled to receive 75.6138% as its share. 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 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 XVIII, shall,
within fifteen (15) business days after receipt of notice, make
payment to Fund XVIII 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-
Co-Tenant Initial: /s/ ADM /s/ LBM
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
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, including Co-Tenant Carolyn W. Davidson
which currently owns an undivided 13.7546% interest in the
Property subject to a co-tenancy agreement with Fund XVIII dated
August 5, 1996, 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
the expiration date plus extensions of the net lease agreement
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 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 deemed
given or served in accordance with the provisions of this
Agreement, if said notice or elections addressed as follows;
If to Fund XVIII:
AEI Real Estate Fund XVIII Limited Partnership
1300 Minnesota World Trade Center
30 E. Seventh Street
St. Paul, Minnesota 55101
If to Davidson:
Carolyn W. Davidson
4407 Ortega Forest Drive
Jacksonville, FL 32210
If to Middleton:
Arel D. and Louise B. Middleton
P.O. Box 283
Wasco, OR 97065-0283
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.
Co-Tenant Initial: /s/ ADM /s/ LBM
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
10. 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.
11. 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.
12. 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/ ADM /s/ LBM
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
IN WITNESS WHEREOF, The parties hereto have caused this Agreement
to be executed and delivered, as of the day and year first above
written.
Middleton Arel D. and Louis B. Middleton
By: /s/ Arel D. Middleton /s/ Arel D. Middleton
Arel D. Middleton
By: /s/ Louise B. Middleton /s/ Louise B. Middleton
Louise B. Middleton
Witness By: /s/ Terry O'Doherty
STATE OF )
) ss
COUNTY OF ) [notary seal]
The foregoing instrument was acknowledged before me, a
Notary Public in and for the County and State aforesaid,
this 12 day of October, 1996, by /s/ Linda Cornie, Notary
Public.
Fund XVIII AEI Real Estate Fund XVIII Limited Partnership
By: AEI Fund Management XVIII, Inc.,
its corporate general partner
By: /s/ Robert P. Johnson
Robert P. Johnson, President
Witness By: /s/ Laura Steidl
Witness By: /s/ Kelly Schueller
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 15th day of October,
1996, Robert P. Johnson, President of AEI Fund Management XVIII,
Inc., corporate general partner of AEI Real Estate Fund XVIII
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/ Catherine A. Davis [notary seal]
Notary Public
Co-Tenant Initial: /s/ ADM /s/ LBM
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
Exhibit A
Legal Description
Lot 31, Block 1, New City Block 15600, CKE Subdivision, Unit 3,
an addition to the City of San Antonio, Bexar County, Texas,
according to the map or plat thereof, recorded in Volume 9504,
Page 182, Deed and Plat Records of Bexar County, Texas.
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000840459
<NAME> AEI REAL ESTATE FUND XVIII LIMITED PARTNERHIP
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 1,693,243
<SECURITIES> 0
<RECEIVABLES> 22,325
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,715,568
<PP&E> 17,762,696
<DEPRECIATION> (2,163,523)
<TOTAL-ASSETS> 17,314,741
<CURRENT-LIABILITIES> 447,957
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 16,341,312
<TOTAL-LIABILITY-AND-EQUITY> 17,314,741
<SALES> 0
<TOTAL-REVENUES> 1,313,392
<CGS> 0
<TOTAL-COSTS> 644,775
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 992,283
<INCOME-TAX> 0
<INCOME-CONTINUING> 992,283
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 992,283
<EPS-PRIMARY> 44.49
<EPS-DILUTED> 44.49
</TABLE>
