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, 1997
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, 1997 and December 31, 1996
Statements for the Periods ended September 30, 1997 and 1996:
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, 1997 AND DECEMBER 31, 1996
(Unaudited)
ASSETS
1997 1996
CURRENT ASSETS:
Cash and Cash Equivalents $ 3,996,690 $ 2,359,926
Receivables 2,348 12,870
----------- -----------
Total Current Assets 3,999,038 2,372,796
----------- -----------
INVESTMENTS IN REAL ESTATE:
Land 3,958,287 4,374,569
Buildings and Equipment 8,924,928 9,198,045
Property Acquisition Costs 69,871 0
Accumulated Depreciation (1,817,861) (1,706,567)
----------- -----------
11,135,225 11,866,047
Real Estate Held for Sale 372,980 792,877
----------- -----------
Net Investments in Real Estate 11,508,205 12,658,924
----------- -----------
Total Assets $15,507,243 $15,031,720
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
CURRENT LIABILITIES:
Payable to AEI Fund Management, Inc. $ 55,016 $ 121,697
Distributions Payable 323,389 323,784
Security Deposit 0 665
Unearned Rent 52,266 5,000
----------- -----------
Total Current Liabilities 430,671 451,146
----------- -----------
PARTNERS' CAPITAL (DEFICIT):
General Partners (44,698) (49,658)
Limited Partners, $1,000 Unit Value;
30,000 Units authorized; 22,783 Issued;
21,764 Units outstanding 15,121,270 14,630,232
----------- -----------
Total Partners' Capital 15,076,572 14,580,574
----------- -----------
Total Liabilities and Partners' Capital $15,507,243 $15,031,720
=========== ===========
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
9/30/97 9/30/96 9/30/97 9/30/96
INCOME:
Rent $ 354,720 $ 419,358 $ 1,058,808 $ 1,233,721
Investment Income 42,784 25,781 129,390 79,671
--------- --------- ---------- ----------
Total Income 397,504 445,139 1,188,198 1,313,392
--------- --------- ---------- ----------
EXPENSES:
Partnership Administration -
Affiliates 61,897 63,639 195,928 184,882
Partnership Administration
and Property Management -
Unrelated Parties 46,728 40,749 96,475 140,096
Depreciation 83,649 108,398 244,188 319,797
--------- --------- ---------- ----------
Total Expenses 192,274 212,786 536,591 644,775
--------- --------- ---------- ----------
OPERATING INCOME 205,230 232,353 651,607 668,617
GAIN ON SALE OF REAL ESTATE 468,544 90,156 845,006 344,461
MINORITY INTEREST IN NET INCOME 0 (13,081) 0 (20,795)
--------- --------- ---------- ----------
NET INCOME $ 673,774 $ 309,428 $ 1,496,613 $ 992,283
========= ========= ========== ==========
NET INCOME ALLOCATED:
General Partners $ 6,738 $ 3,094 $ 14,966 $ 9,923
Limited Partners 667,036 306,334 1,481,647 982,360
--------- --------- ---------- ----------
$ 673,774 $ 309,428 $ 1,496,613 $ 992,283
========= ========= ========== ==========
NET INCOME PER
LIMITED PARTNERSHIP UNIT
(21,764 and 22,078 weighted average
Units outstanding in 1997
and 1996, respectively) $ 30.65 $ 13.87 $ 68.08 $ 44.49
========= ========= ========== ==========
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)
1997 1996
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 1,496,613 $ 992,283
Adjustments to Reconcile Net Income to Net Cash
Provided by Operating Activities:
Depreciation 244,188 319,797
Gain on Sale of Real Estate (845,006) (344,461)
Decrease in Receivables 10,522 21,064
Decrease in Payable to
AEI Fund Management, Inc. (66,681) (7,008)
Increase (Decrease) in Security Deposit (665) 31,010
Increase in Unearned Rent 47,266 45,160
Minority Interest 0 (5,795)
----------- -----------
Total Adjustments (610,376) 59,767
----------- -----------
Net Cash Provided By
Operating Activities 886,237 1,052,050
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Investments in Real Estate (1,445,445) (1,911,639)
Proceeds from Sale of Real Estate - Net of
Minority Interest 3,196,982 1,303,490
----------- -----------
Net Cash Provided By (Used For)
Investing Activities 1,751,537 (608,149)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Decrease in Distributions Payable (395) (82,554)
Distributions to Partners (1,000,615) (1,001,078)
----------- -----------
Net Cash Used For
Financing Activities (1,001,010) (1,083,632)
----------- -----------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 1,636,764 (639,731)
CASH AND CASH EQUIVALENTS, beginning of period 2,359,926 2,332,974
----------- -----------
CASH AND CASH EQUIVALENTS, end of period $ 3,996,690 $ 1,693,243
=========== ===========
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, 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
========= =========== =========== ==========
BALANCE, December 31, 1996 $ (49,658) $14,630,232 $14,580,574 21,764.38
Distributions (10,006) (990,609) (1,000,615)
Net Income 14,966 1,481,647 1,496,613
--------- ----------- ----------- ----------
BALANCE, September 30, 1997 $ (44,698) $15,121,270 $15,076,572 21,764.38
========= =========== =========== ==========
The accompanying Notes to Financial Statements are an integral
part of this statement.
</PAGE>
<PAGE>
AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1997
(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 -
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 November,
1993, after reviewing the lessee's operating results, the
Partnership determined that the lessee would be unable to
operate the restaurants in a manner capable of maximizing
the restaurants' sales. Consequently, at the direction of
the Partnership, a multi-unit restaurant operator assumed
operation of the restaurants while the Partnership reviewed
the available options. 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 vacant, 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.
No rents were collected from the Sizzler restaurants in the
first nine months of 1997 and 1996. The total amount of
rent not collected in 1997 and 1996 was $293,173 and
$296,145, respectively, for the three properties. These
amounts were not accrued for financial reporting purposes.
On January 23, 1997, the Partnership sold its interest in
the Cincinnati restaurant to an unrelated third party. The
Partnership received net sales proceeds of $19,867, which
resulted in a net loss of $31,700, which was recognized as a
real estate impairment in the fourth quarter of 1996.
In December, 1996, the Partnership, in order to avoid
additional property management expenses, decided to sell the
Sizzler properties in Springboro and Fairfield rather than
to continue to attempt to re-lease the properties. As a
result, the properties were reclassified on the balance
sheet to Real Estate Held for Sale. In addition, based on
an analysis of market conditions in the area, it was
determined that a sale of the properties would result in net
proceeds of approximately $800,000. The Partnership's share
of the proceeds would be approximately $773,000. A charge
to operations for real estate impairment of $1,654,600
($693,500 for the Springboro Sizzler, and $961,100 for the
Fairfield Sizzler) was recognized in the fourth quarter of
1996, which is the difference between book value at
December 31, 1996 of $2,427,600 ($1,066,500 for the
Springboro Sizzler and $1,361,100 for the Fairfield Sizzler)
and the estimated market value of $773,000 ($373,000 for the
Springboro Sizzler and $400,000 for the Fairfield Sizzler).
The charge was recorded against the cost of the land,
building and equipment.
On September 22, 1997, the Partnership sold the Sizzler
restaurant in Fairfield, Ohio to an unrelated third party.
The Partnership received net sale proceeds of $528,476,
which is in excess of the book value of the property after
the recognition of the real estate impairment. As a result,
the Partnership recognized a net gain of $128,498.
AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(3) Investments in Real Estate - (Continued)
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 annual base
rent from $47,498 and $48,392 to $15,000 for each property.
The Partnership could receive additional rent in the future
equal to 6.75% of the amount by which gross receipts exceed
$275,000. In 1997, the Leases, as amended, were confirmed
as part of the reorganization plan. The lessee has agreed
to pay all pre-petition and post-petition rents due of
$74,525 and the Partnership's related administrative and
legal expenses. However, due to the uncertainty of
collection, the Partnership has not accrued any of these
amounts for financial reporting purposes.
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 the funds to
satisfy rents and real estate taxes due. In 1997, the
Partnership took possession of the property and listed it
for sale or re-lease. While the property is being sold or
re-leased, the Partnership is responsible for real estate
taxes and other costs required to maintain the property.
The Partnership used the majority of the proceeds from two
property sales in 1995 to purchase two properties in 1996,
as discussed below. The remainder of the proceeds from
these sales were distributed to the Partners in 1995 and
1996.
On April 10, 1996, the Partnership purchased an 85.0%
interest in a Tractor Supply Company 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 Champps 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
$962,298, which resulted in a net gain of $254,305. At the
time of sale, the cost and related accumulated depreciation
of the property was $784,045 and $76,052, respectively.
Through September 30, 1997, the Partnership sold 94.1709% of
the Applebee's restaurant in Destin, Florida in seven
separate transactions to unrelated third parties. The
Partnership received total net sale proceeds of $1,413,627
which resulted in a total net gain of $481,379. The total
cost and related accumulated depreciation of the interests
sold was $1,053,565 and $121,317, respectively. For the
nine months ended September 30, 1997, the net gain was
$320,171.
AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(3) Investments in Real Estate - (Continued)
Through September 30, 1997, the Partnership sold 64.9377% of
a Taco Cabana restaurant in San Antonio, Texas in five
separate transactions to unrelated third parties. The
Partnership received total net sale proceeds of $1,067,551
which resulted in a total net gain of $379,348. The total
cost and related accumulated depreciation of the interests
sold was $748,028 and $59,825, respectively. For the nine
months ended September 30, 1997 and 1996, the net gain was
$172,591 and $70,396, respectively.
Through September 30, 1997, the Partnership sold 47.3553% of
the Tractor Supply Company in Bristol, Virginia in five
separate transactions to unrelated third parties. The
Partnership received total net sale proceeds of $709,795
which resulted in a total net gain of $110,391. The total
cost and related accumulated depreciation of the interests
sold was $609,695 and $10,291, respectively. For the nine
months ended September 30, 1997 and 1996, the net gain was
$72,607 and $16,621, respectively.
Through September 30, 1997, the Partnership sold 26.0312% of
the Champps Americana restaurant in Columbus, Ohio in three
separate transactions to unrelated third parties. The
Partnership received total net sale proceeds of $807,777
which resulted in a total net gain of $151,139. The total
cost and related accumulated depreciation of the interests
sold was $667,813 and $11,175, respectively. For the nine
months ended September 30, 1997, the net gain was $151,139.
In October, 1997, the Partnership sold an additional
25.6924% of the Taco Cabana restaurant in San Antonio,
Texas, in two separate transactions, to unrelated third
parties. The Partnership received net sale proceeds of
approximately $440,000, which resulted in a net gain of
approximately $171,000.
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. In
December, 1996, the Managing General Partner filed 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 Taco Cabana
restaurants, Tractor Supply Company and subsequent property
sales in additional properties. The Amendment passed with a
majority of Units voting in favor of the Amendment.
On July 30, 1997, the Partnership purchased a Fuddrucker's
restaurant in Thornton, Colorado for $1,375,573. The
property is leased to Fuddrucker's, Inc. under a Lease
Agreement with a primary term of 20 years and annual rental
payments of $148,387.
During the first nine months of 1997 and the year 1996, the
Partnership distributed $104,820 and $372,366 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 $4.77 and $16.85 per Limited
Partnership Unit, respectively.
AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Continued)
(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.
ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS
Results of Operations
For the nine months ended September 30, 1997 and 1996, the
Partnership recognized rental income of $1,058,808 and
$1,233,721, respectively. During the same periods, the
Partnership earned investment income of $129,390 and $79,671,
respectively. In 1997, rental income decreased mainly as a
result of the property sales and the Brownsville Taco Cabana
situation discussed below. The decrease in rental income was
partially offset by rental income received from three subsequent
property acquisitions, rent increases on eleven 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 November, 1993, after
reviewing the lessee's operating results, the Partnership
determined that the lessee would be unable to operate the
restaurants in a manner capable of maximizing the restaurants'
sales. Consequently, at the direction of the Partnership, a
multi-unit restaurant operator assumed operation of the
restaurants while the Partnership reviewed the available options.
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 vacant,
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.
No rents were collected from the Sizzler restaurants in
the first nine months of 1997 and 1996. The total amount of rent
not collected in 1997 and 1996 was $293,173 and $296,145,
respectively, for the three properties. These amounts were not
accrued for financial reporting purposes.
On January 23, 1997, the Partnership sold its interest in
the Cincinnati restaurant to an unrelated third party. The
Partnership received net sales proceeds of $19,867, which
resulted in a net loss of $31,700, which was recognized as a real
estate impairment in the fourth quarter of 1996.
ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued)
In December, 1996, the Partnership, in order to avoid
additional property management expenses, decided to sell the
Sizzler properties in Springboro and Fairfield rather than to
continue to attempt to re-lease the properties. As a result, the
properties were reclassified on the balance sheet to Real Estate
Held for Sale. In addition, based on an analysis of market
conditions in the area, it was determined that a sale of the
properties would result in net proceeds of approximately
$800,000. The Partnership's share of the proceeds would be
approximately $773,000. A charge to operations for real estate
impairment of $1,654,600 ($693,500 for the Springboro Sizzler,
and $961,100 for the Fairfield Sizzler) was recognized in the
fourth quarter of 1996, which is the difference between book
value at December31, 1996 of $2,427,600 ($1,066,500 for the
Springboro Sizzler and $1,361,100 for the Fairfield Sizzler) and
the estimated market value of $773,000 ($373,000 for the
Springboro Sizzler and $400,000 for the Fairfield Sizzler). The
charge was recorded against the cost of the land, building and
equipment.
On September 22, 1997, the Partnership sold the Sizzler
restaurant in Fairfield, Ohio to an unrelated third party. The
Partnership received net sale proceeds of $528,476, which is in
excess of the book value of the property after the recognition of
the real estate impairment. As a result, the Partnership
recognized a net gain of $128,498.
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 annual base rent from $47,498
and $48,392 to $15,000 for each property. The Partnership could
receive additional rent in the future equal to 6.75% of the
amount by which gross receipts exceed $275,000. In 1997, the
Leases, as amended, were confirmed as part of the reorganization
plan. The lessee has agreed to pay all pre-petition and post-
petition rents due of $74,525 and the Partnership's related
administrative and legal expenses. However, due to the
uncertainty of collection, the Partnership has not accrued any of
these amounts for financial reporting purposes.
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 the funds to satisfy
rents and real estate taxes due. In 1997, the Partnership took
possession of the property and listed it for sale or re-lease.
While the property is being sold or re-leased, the Partnership is
responsible for real estate taxes and other costs required to
maintain the property.
During the nine months ended September 30, 1997 and 1996,
the Partnership paid Partnership administration expenses to
affiliated parties of $195,928 and $184,882, 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 $96,475 and $140,096, 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 decrease
in these expenses in 1997, when compared to the same period in
1996, is the result of expenses incurred in 1996 related to the
Sizzler situation discussed above.
As of September 30, 1997, the Partnership's annualized
cash distribution rate was 6.1%, 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.
ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued)
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, 1997, the
Partnership's cash balances increased $1,636,764 mainly as the
result of the sale of properties discussed below. Net cash
provided by operating activities decreased from $1,052,050 in
1996 to $886,237 in 1997 mainly as a result of a decrease in
income in 1997, when compared to 1996, and net timing differences
in the collection of payments from the lessees and the payment of
expenses.
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. For the nine months ended
September 30, 1997 and 1996, the Partnership generated cash flow
from the sale of real estate, as discussed below, of $3,196,982
and $1,303,490, respectively. During the same periods, the
Partnership expended $1,445,445 and $1,911,639, respectively, to
invest in real properties (inclusive of acquisition expenses) as
the Partnership reinvested the cash generated from the property
sales.
The Partnership used the majority of the proceeds from two
property sales in 1995 to purchase two properties in 1996, as
discussed below. The remainder of the proceeds from these sales
were distributed to the Partners in 1995 and 1996.
On April 10, 1996, the Partnership purchased an 85.0%
interest in a Tractor Supply Company 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 Champps 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 $962,298, which
resulted in a net gain of $254,305. At the time of sale, the
cost and related accumulated depreciation of the property was
$784,045 and $76,052, respectively.
Through September 30, 1997, the Partnership sold 94.1709%
of the Applebee's restaurant in Destin, Florida in seven separate
transactions to unrelated third parties. The Partnership
received total net sale proceeds of $1,413,627 which resulted in
a total net gain of $481,379. The total cost and related
accumulated depreciation of the interests sold was $1,053,565 and
$121,317, respectively. For the nine months ended September 30,
1997, the net gain was $320,171.
ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued)
Through September 30, 1997, the Partnership sold 64.9377%
of a Taco Cabana restaurant in San Antonio, Texas in five
separate transactions to unrelated third parties. The
Partnership received total net sale proceeds of $1,067,551 which
resulted in a total net gain of $379,348. The total cost and
related accumulated depreciation of the interests sold was
$748,028 and $59,825, respectively. For the nine months ended
September 30, 1997 and 1996, the net gain was $172,591 and
$70,396, respectively.
Through September 30, 1997, the Partnership sold 47.3553%
of the Tractor Supply Company in Bristol, Virginia in five
separate transactions to unrelated third parties. The
Partnership received total net sale proceeds of $709,795 which
resulted in a total net gain of $110,391. The total cost and
related accumulated depreciation of the interests sold was
$609,695 and $10,291, respectively. For the nine months ended
September 30, 1997 and 1996, the net gain was $72,607 and
$16,621, respectively.
Through September 30, 1997, the Partnership sold 26.0312%
of the Champps Americana restaurant in Columbus, Ohio in three
separate transactions to unrelated third parties. The
Partnership received total net sale proceeds of $807,777 which
resulted in a total net gain of $151,139. The total cost and
related accumulated depreciation of the interests sold was
$667,813 and $11,175, respectively. For the nine months ended
September 30, 1997, the net gain was $151,139.
In October, 1997, the Partnership sold an additional
25.6924% of the Taco Cabana restaurant in San Antonio, Texas, in
two separate transactions, to unrelated third parties. The
Partnership received net sale proceeds of approximately $440,000,
which resulted in a net gain of approximately $171,000.
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. In
December, 1996, the Managing General Partner filed 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 Taco Cabana restaurants,
Tractor Supply Company and subsequent property sales in
additional properties. The Amendment passed with a majority of
Units voting in favor of the Amendment.
On July 30, 1997, the Partnership purchased a Fuddrucker's
restaurant in Thornton, Colorado for $1,375,573. The property is
leased to Fuddrucker's, Inc. under a Lease Agreement with a
primary term of 20 years and annual rental payments of $148,387.
During the first nine months of 1997 and the year 1996,
the Partnership distributed $104,820 and $372,366 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 $4.77 and $16.85 per Limited Partnership Unit,
respectively.
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.
ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued)
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, 1997, seventeen Limited Partners redeemed a
total of 277.1 Partnership Units for $193,337 in accordance with
the Partnership Agreement. The Partnership acquired these Units
using Net Cash Flow from operations. In prior years, a total of
sixty-one Limited Partners redeemed 1,018.42 Partnership Units
for $835,859. The redemptions increase the remaining Limited
PartnersO ownership interest in the Partnership.
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.
ITEM 4.SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
In September, 1997, the Managing General Partner solicited
by mail a proxy statement to propose an Amendment to the
Limited Partnership Agreement. The Amendment made changes to
the PartnershipOs Unit repurchase provisions. In order for a
proposed Amendment to be adopted, a majority of the Units must
be voted in favor of the Amendment. Of the 21,764 outstanding
Units, 11,694 voted for the Amendment, 442 voted against and
262 abstained. As a result, the Amendment was adopted.
ITEM 5.OTHER INFORMATION
None.
PART II - OTHER INFORMATION
(Continued)
ITEM 6.EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits -
Description
10.1 Purchase Agreement dated July 16,
1997 between the Partnership and Stanley
E. LaCorte relating to the property at
5701 Emerald Coast Parkway, Destin,
Florida.
10.2 Purchase Agreement dated August 19,
1997 between the Partnership and Truong
Hoang, Trustee and Thanh Do, Trustee of
the Hoang-Do Family Living Trust relating
to the property at 5701 Emerald Coast
Parkway, Destin, Florida.
10.3 Property Co-tenancy Ownership
Agreement dated September9, 1997 between
the Partnership and Truong Hoang, Trustee
and Thanh Do, Trustee of the Hoang-Do
Family Living Trust relating to the
property at 5701 Emerald Coast Parkway,
Destin, Florida.
10.4 Purchase Agreement dated September
9, 1997 between the Partnership and Nick
DeVito, Inc. relating to the property at
6867 Highway 90 West, San Antonio, Texas.
10.5 Property Co-tenancy Ownership
Agreement dated September22, 1997 between
the Partnership and Stanley E. LaCorte
relating to the property at 5701 Emerald
Coast Parkway, Destin, Florida.
10.6 Property Co-tenancy Ownership
Agreement dated September25, 1997 between
the Partnership and Nick DeVito, Inc.
relating to the property at 6867 Highway
90 West, San Antonio, Texas.
10.7 Purchase Agreement dated September
30, 1997 between the Partnership and
Reginald O. Hill, Trustee of the Reginald
O. Hill Trust dated 5/25/95 and Donna
Jean Hill, Trustee of the Donna Jean Hill
Trust dated 5/25/95 relating to the
property at 6867 Highway 90 West, San
Antonio, Texas.
10.8 Purchase Agreement dated October 5,
1997 between the Partnership and Anthony
Drago, Trustee, U/A DTD 8/19/80, FBO
Anthony and Sydelle Drago Family Trust
relating to the property at 6867 Highway
90 West, San Antonio, Texas.
10.9 Property Co-tenancy Ownership
Agreement dated October 9, 1997 between
the Partnership and Reginald O. Hill,
Trustee of the Reginald O. Hill Trust
dated 5/25/95 and Donna Jean Hill,
Trustee of the Donna Jean Hill Trust
dated 5/25/95 relating to the property at
6867 Highway 90 West, San Antonio, Texas.
PART II - OTHER INFORMATION
(Continued)
ITEM 6.EXHIBITS AND REPORTS ON FORM 8-K (Continued)
a. Exhibits -
Description
10.10 Property Co-tenancy Ownership
Agreement dated October 24, 1997 between
the Partnership and Anthony Drago,
Trustee, U/A DTD 8/19/80, FBO Anthony and
Sydelle Drago Family Trust relating to
the property at 6867 Highway 90 West, San
Antonio, Texas.
27 Financial Data Schedule for period
ended September 30, 1997.
b. Reports filed on Form 8-K - None.
SIGNATURES
In accordance with the requirements of the Exchange Act, the
Registrant has caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
Dated: November 4, 1997 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
Applebee's Restaurant - Destin, FL
This AGREEMENT, entered into effective as of the 16th of July,
1997 .
l. Parties. Seller is AEI Real Estate Fund XVIII Limited
Partnership which owns an undivided 37.9481% interest in the fee
title to that certain real property legally described in the
attached Exhibit "A" (the "Entire Property") Buyer is Stanley E.
La Corte, ("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 17.7781 percentage interest
(hereinafter, simply the "Property") as Tenant in Common in the
Entire Property.
3. Purchase Price . The purchase price for this percentage
interest in the Entire Property is $300,000, all cash.
4. Terms. The purchase price for the Property will be paid by
Buyer as follows:
(a) When this agreement is executed, Buyer will pay $5,000
to Seller (which shall be deposited into escrow according to
the terms hereof) (the "First Payment"). The First Payment
will be credited against the purchase price when and if
escrow closes and the sale is completed.
(b) Buyer will deposit the balance of the purchase price,
$295,000 (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 August 14,
1997.
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. Buyer agrees to indemnify and hold Seller
harmless for any loss or damage to the Entire Property or persons
caused by Buyer or its agents arising out of such physical
inspections of the Entire Property. (The "Review Period")
(a) The original and one copy of a title insurance
commitment for an Owner's Title insurance policy (see
paragraph 8 below).
(b) Copies of a Certificate of Occupancy or other such
document certifying completion and granting permission to
permanently occupy the improvements on the Entire Property
as are in Seller's possession.
(c) Copies of an "as built" survey of the Entire Property
done concurrent with Seller's acquisition of the Property.
(d) Lease (as set forth in paragraph 11(a) below) of the
Entire Property showing occupancy date, lease expiration
date, rent, and Guarantys, if any, accompanied by such
tenant financial statements as may have been provided most
recently to Seller by the Tenant and/or Guarantors.
It is a contingency upon Seller's obligations hereunder that
two (2) copies of Co-Tenancy Agreement in the form attached
hereto duly executed by Buyer and Seller and dated on escrow
closing date be delivered to the Seller on the closing date.
Buyer Initial:
Purchase Agreement for Applebee's - Destin, FL
Buyer may cancel this agreement for ANY REASON in its sole
discretion by delivering a cancellation notice, return receipt
requested, to Seller and escrow holder before the expiration of
the Review Period. Such notice shall be deemed effective only
upon receipt by Seller. If this Agreement is not cancelled as
set forth above, the First Payment shall be non-refundable unless
Seller shall default hereunder.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under 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.
Unless this Agreement is canceled by Buyer pursuant to the
terms hereof, if Buyer fails to make the Second Payment, Seller
shall be entitled to retain the First Payment and Buyer
irrevocably will be deemed to 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; the rights of parties in
possession pursuant to the Lease defined in paragraph 11 below;
and other items of record disclosed to Buyer during the Review
Period.
Buyer shall be allowed five (5) days after receipt of said
commitment for examination and the making of any objections to
marketability thereto, said objections to be made in writing or
deemed waived. If any objections are so made, the Seller shall
be allowed eighty (80) days to make such title marketable or in
the alternative to obtain a commitment for insurable title
insuring over Buyer's objections. If Seller shall decide to make
no efforts to make title marketable, or is unable to make title
marketable or obtain insurable title, (after execution by Buyer
of such documents reasonably requested by Seller to evidence the
termination hereof) Buyer's First Payment shall be returned and
this Agreement shall be null and void and of no further force and
effect.
Pending correction of title, the payments hereunder required
shall be postponed, but upon correction of title and within ten
(10) days after written notice of correction to the Buyer, the
parties shall perform this Agreement according to its terms.
Buyer Initial: /s/ SEL
Purchase Agreement for Applebee' - Destin, FL
9. Closing Costs. Seller will pay one-half of escrow fees, the
cost of the title commitment and any brokerage commissions
payable. The Buyer will pay the cost of issuing a standard
Owners Title Insurance Policy in the full amount of the purchase
price, if Buyer shall decide to purchase the same. Buyer will
pay all recording fees, one-half of the escrow fees, and the cost
of an update to the Survey in Sellers possession (if an update is
required by Buyer.) Each party will pay its own attorney's fees
and costs to document and close this transaction.
10. Real Estate Taxes, Special Assessments and Prorations.
(a) Because the Entire Property (of which the Property is a
part) is subject to a triple net lease (as further set forth
in paragraph 11(a)(i)), the parties acknowledge that there
shall be no need for a real estate tax proration. However,
Seller represents that to the best of its knowledge, all
real estate taxes and installments of special assessments
due and payable in all years prior to the year of Closing
have been paid in full. Unpaid 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 thereafter, if such unpaid
levied and pending special assessments and real estate taxes
are not paid by any tenant of the Entire Property.
(b) All income and all operating expenses from the Entire
Property shall be prorated between the parties and adjusted
by them as of the date of Closing. Seller shall be entitled
to all income earned and shall be responsible for all
expenses incurred prior to the date of Closing, and Buyer
shall be entitled to its proportionate share of all income
earned and shall be responsible for its proportionate shall
of all operating expenses of the Entire Property incurred on
and after the date of Closing.
11. Seller's Representation and Agreements.
(a) Seller represents and warrants as of this date that:
(i) Except for the lease in existence between AEI Real
Estate Fund XVIII Limited Partnership and T.S.S.O.,
Inc.("Tenant"), dated October 31, 1991 (as amended by letter
agreement dated September 21, 1995 between AEI and Tenant),
Seller is not aware of any leases of the Property. The
above referenced lease agreement has an option to purchase
in favor of the Tenant as set forth in article 35 of said
lease agreement.
(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 prior to the Closing Date 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.
Buyer Initial: /s/ SEL
Purchase Agreement for Applebee' - Destin, FL
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 the use and operation of 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.
(f) Buyer acknowledges that, having been given the
opportunity to inspect the Property and such financial
information on the Tenant 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 Tenant and Guarantors of
Lease was obtained from a variety of sources and Seller
neither (a) has made independent investigation or
verification of such information, or (b) makes any
representations as to the accuracy or completeness of such
information. The sale of the Property as provided for
herein is made on an "AS IS" basis, and Buyer expressly
acknowledges that, in consideration of the agreements of
Seller herein, except as otherwise specified herein, Seller
makes no warranty or representation, express or implied, or
arising by operation of law, including, but not limited to,
any warranty or condition, habitability, tenantability,
suitability for commercial purposes, merchantability, or
fitness for a particular purpose, in respect of the
Property.
The provisions (d) - (f) above shall survive closing.
Buyer Initial: /s/ SEL
Purchase Agreement for Applebee' - Destin, FL
13. Closing.
(a) Before the closing date, Seller will deposit into
escrow an executed limited warranty deed conveying insurable
title of the Property to Buyer, subject to the encumbrances
contained in paragraph 8 above.
(b) On or before the closing date, Buyer will deposit into
escrow: the balance of the purchase price when required
under Section 4; any additional funds required of Buyer,
(pursuant to this agreement or any other agreement executed
by Buyer) to close escrow. Both parties will sign the Co-
Tenancy Agreement, 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 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
Buyer Initial: /s/ SEL
Purchase Agreement for Applebee' - Destin, FL
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 ten-day period provided for above in this Subparagraph
16a for Buyer to elect to terminate this Agreement has
expired or Buyer has, by written notice to Seller, waived
Buyer's right to terminate this Agreement. If Buyer elects
to proceed and to consummate the purchase despite said
damage or destruction, there shall be no reduction in or
abatement of the purchase price, and Seller shall assign to
Buyer the Seller's right, title, and interest in and to all
insurance proceeds (pro-rata in relation to the Entire
Property) resulting from said damage or destruction to the
extent that the same are payable with respect to damage to
the Property, subject to rights of any Tenant of the Entire
Property.
If the cost of repair is less than $10,000.00, Buyer shall
be obligated to otherwise perform hereinunder with no
adjustment to the Purchase Price, reduction or abatement,
and Seller shall assign Seller's right, title and interest
in and to all insurance proceeds pro-rata in relation to the
Entire Property, subject to rights of any Tenant of the
Entire Property.
(b) If, prior to closing, the Property, or any part
thereof, is taken by eminent domain, this Agreement shall
become null and void, at Buyer's option. If Buyer elects to
proceed and to consummate the purchase despite said taking,
there shall be no reduction in, or abatement of, the
purchase price, and Seller shall assign to Buyer the
Seller's right, title, and interest in and to any award
made, or to be made, in the condemnation proceeding pro-rata
in relation to the Entire Property, subject to rights of any
Tenant of the Entire Property.
In the event that this Agreement is terminated by Buyer as
provided above in Subparagraph 16a or 16b, the First Payment
shall be immediately returned to Buyer (after execution by Buyer
of such documents reasonably requested by Seller to evidence the
termination hereof).
17. Buyer's 1031 Tax Free Exchange.
While Seller acknowledges that Buyer is purchasing the
Property as "replacement property" to accomplish a tax free
exchange, Buyer acknowledges that Seller has made no
representations, warranties, or agreements to Buyer or Buyer's
agents that the transaction contemplated by the Agreement will
qualify for such tax treatment, nor has there been any reliance
thereon by Buyer respecting the legal or tax implications of the
transactions 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 intends that this transaction qualify as an exchange
under Section 1031 of the Internal Revenue Code of 1986 and
regulations thereunder. Buyer intends to perfect the 1031
exchange by way of a simultaneous exchange of properties through
concurrently conditional closing escrows conducted under escrow
instruction that will qualify the transaction under Section 1031.
Buyer Initial: /s/ SEL
Purchase Agreement for Applebee' - Destin, FL
18. Cancellation
If any party elects to cancel this Contract because of any
breach by another party, the party electing to cancel shall
deliver to escrow agent a notice containing the address of
the party in breach and stating that this Contract shall be
cancelled unless the breach is cured within 13 days
following the delivery of the notice to the escrow agent.
Within three days after receipt of such notice, the escrow
agent shall send it by United States Mail to the party in
breach at the address contained in the Notice and no further
notice shall be required. If the breach is not cured within
the 13 days following the delivery of the notice to the
escrow agent, this Contract shall be cancelled.
19. Miscellaneous.
(a) This Agreement may be amended only by written agreement
signed by both Seller and Buyer, and all waivers must be in
writing and signed by the waiving party. Time is of the
essence. This Agreement will not be construed for or
against a party whether or not that party has drafted this
Agreement. If there is any action or proceeding between the
parties relating to this Agreement the prevailing party will
be entitled to recover attorney's fees and costs. This is
an integrated agreement containing all agreements of the
parties about the Property and the other matters described,
and it supersedes any other agreements or understandings.
Exhibits attached to this Agreement are incorporated into
this Agreement.
(b) If this escrow has not closed by August 14, 1997
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:
Stanley E. La Corte
400 East Colonial drive
Suite 609
Orlando, FL 32803
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
Buyer Initial: /s/ SEL
Purchase Agreement for Applebee' - Destin, FL
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: Stanley E. La Corte
By: /s/ Stanley E. LaCorte
WITNESS:
/s/ Edward A Kerber
Edward A Kerber
(Print Name)
WITNESS:
/s/ Lavonne Harmon
Lavonne Harmon
(Print Name)
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
WITNESS:
/s/ Laura M Steidl
Laura M Steidl
(Print Name)
WITNESS:
/s/ Kelly Kae Schuller
Kelly Kae Schuller
(Print Name)
Buyer Initial: /s/ SEL
Purchase Agreement for Applebee' - Destin, FL
EXHIBIT A
Legal Description
Premises: APPLEBEE'S NEIGHBORHOOD GRILL & BAR
A portion of Section 26, Township 2 South. Range 21 West,
Walton County, Florida, being more particularly described as
follows:
Commence at the intersection with the East line of the
aforesaid Section 26 and the North Right-of-way Line of
State Road 30 (U.S. 98. 100' R/W); thence go North 77
degrees 09 minutes 03 seconds West along the aforesaid Right-
of-way line, a distance of 1233.51 feet to a point of
curvature: thence go along a curve to the left, having a
radius of 5779.65 feet, an arc distance of 1060.26 feet (CH.
= 1058.78', CH. BRG. = North 82 degrees 24 minutes 26
seconds West); thence departing the aforesaid North Right-of-
way line, go North 02 degrees 59 seconds 27 minutes East, a
distance of 10.00 feet to a point on a curve, being concave
southerly and having a radius of 5789.65 feet and the Point
of Beginning: thence go northwesterly along the aforesaid
curve, an arc distance of 180.00 feet (CH. = 179.99', CH.
BRG. = North 88 degrees 33 minutes 11 seconds West): thence
go North 02 degrees 59 minutes 27 seconds East, a distance
of 215.00 feet: thence go South 88 degrees 38 minutes 25
seconds East, a distance of 178.79 feet to a Point on a
curve, being concave southwesterly and having a radius of
44.90 feet: thence go Southeasterly along the aforesaid
curve, an arc distance of 10.44 feet (CHI. = 10.42'. CHI.
BRAG. = South 03 degrees 39 minutes 46 seconds East) to the
Point of Tangency: thence go South 02 degrees 59 minutes 27
seconds East, a distance of 204.89 feet to the Point of
Beginning.
EXCEPTING THEREFROM THAT PORTION
lying Northerly of and within 66 feet of the centerline of
survey of State Road 30 (US 98) Section 60020, Westerly of
Station 248+00 and lying Northerly of and within 67 feet of
said centerline of survey, between Station 248+00 and
Station 256+51 and lying Northerly of said centerline of
survey and within a transition from 67 feet at Station
256+51 to 87 feet at Station 256+76; and lying Northerly of
and within 110 feet of said centerline of survey, between
Station 256+76 and Station 257+36; and lying Northerly of
said centerline of survey and within a transition from 87
feet at Station 257+36 to 67 feet at Station 257+61; and
lying Northerly of and within 67 feet of said centerline of
survey Easterly of Station 257+611; said centerline to be
described and said Stations to be located as follows:
Commence on a capped rod (RLS # 1835) at the Southeast
corner of Sandestin Estates Subdivision, as per plat
recorded in Plat Book 4, Page 25 of the Public Records of
Walton County, Florida; thence South 44 16' 49" East 101.64
feet; thence North 83 48' 54" East 3476.74 feet (crossing
the East line of Section 27, Township 2 South, Range 21 West
and the West line of Section 26, Township 2 South 2 South,
Range 21 West) to the POINT OF BEGINNING of centerline of
survey to be described herein, said point being the
beginning of a curve, concave Southerly, having a radius of
5729.58 feet; thence run Northeasterly, Easterly and
Southeasterly 1302.52 feet along said curve, thru a central
angle of 13 o1' 31" to Station 248+00; thence continue
Southeasterly 695.62 feet along said curve, thru a central
angle of 6 57' 22" to the end of curve; thence South 76 12'
14" East 155.38 feet to Station 256+51; thence continue
South 76 12' 14" East 25.0 feet to Station 256+76; thence
continue South 76 12' 14" East 60.00 feet to Station 257+36;
thence continue South 76 12'14" East 25.0 feet to Station
257+61; thence continue South 76 12' 14" East 977.87 feet to
the East line of said Section 26 (West line of Section 25,
Township 2 South Range 21 West) at a point 4561.50 feet
South 1 50' 37" West of a four inch by four inch concrete
monument on the Northeast corner of said Section 26
(Northwest corner of said Section 25); thence continue South
76 12' 14" East 1359.55 feet to a point of intersection with
the Southerly extension of the Easterly line of Parcel A of
Tract 308 of said Section 25; and end of centerline of
survey herein described; said point being 518.40 feet South
2 00' 23" West of a capped rod (RLS # 2535) on the Northeast
corner of said partial A; containing 1080 square feet, more
or less.
PURCHASE AGREEMENT
Applebee's Restaurant - Destin, FL
This AGREEMENT, entered into effective as of the 19 of August,
1997 .
l. Parties. Seller is AEI Real Estate Fund XVIII Limited
Partnership which owns an undivided 37.9481% interest in the fee
title to that certain real property legally described in the
attached Exhibit "A" (the "Entire Property") Buyer is Truong
Hoang, Trustee and Thanh Do, Trustee of the Hoang-Do Family
Living Trust, dated 8/19/97, ("Buyer"). Seller wishes to sell and
Buyer wishes to buy a portion as Tenant in Common of Seller's
interest in the Entire Property.
2. Property. The Property to be sold to Buyer in this transaction
consists of an undivided 14.3409 percentage interest
(hereinafter, simply the "Property") as Tenant in Common in the
Entire Property.
3. Purchase Price . The purchase price for this percentage
interest in the Entire Property is $242,000, all cash.
4. Terms. The purchase price for the Property will be paid by
Buyer as follows:
(a) When this agreement is executed, Buyer will pay $5,000
to Seller (which shall be deposited into escrow according to
the terms hereof) (the "First Payment"). The First Payment
will be credited against the purchase price when and if
escrow closes and the sale is completed.
(b) Buyer will deposit the balance of the purchase price,
$237,000 (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 30,
1997.
6. Due Diligence. Buyer will have until the expiration of the
fifteenth 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. Buyer agrees to indemnify and
hold Seller harmless for any loss or damage to the Entire
Property or persons caused by Buyer or its agents arising out of
such physical inspections of the Entire Property. (The "Review
Period")
(a) The original and one copy of a title insurance
commitment for an Owner's Title insurance policy (see
paragraph 8 below).
(b) Copies of a Certificate of Occupancy or other such
document certifying completion and granting permission to
permanently occupy the improvements on the Entire Property
as are in Seller's possession.
(c) Copies of an "as built" survey of the Entire Property
done concurrent with Seller's acquisition of the Property.
(d) Lease (as set forth in paragraph 11(a) below) of the
Entire Property showing occupancy date, lease expiration
date, rent, and Guarantys, if any, accompanied by such
tenant financial statements as may have been provided most
recently to Seller by the Tenant and/or Guarantors.
(e) Phase 1 Environmental Report.
Buyer Initial: /s/ T.D. /s/ TH
Purchase Agreement for Applebee's - Destin,FL
It is a contingency upon Seller's obligations hereunder that
two (2) copies of Co-Tenancy Agreement in the form attached
hereto duly executed by Buyer and Seller and dated on escrow
closing date be delivered to the Seller on the closing date.
Buyer may cancel this agreement for ANY REASON in its sole
discretion by delivering a cancellation notice, return receipt
requested, to Seller and escrow holder before the expiration of
the Review Period. Such notice shall be deemed effective only
upon receipt by Seller. If this Agreement is not cancelled as
set forth above, the First Payment shall be non-refundable unless
Seller shall default hereunder.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under 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.
Unless this Agreement is canceled by Buyer pursuant to the
terms hereof, if Buyer fails to make the Second Payment, Seller
shall be entitled to retain the First Payment and Buyer
irrevocably will be deemed to 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; the rights of parties in
possession pursuant to the Lease defined in paragraph 11 below;
and other items of record disclosed to Buyer during the Review
Period.
Buyer shall be allowed fifteen (15) 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.
Buyer Initial: /s/ T.D. /s/ TH
Purchase Agreement for Applebee's - Destin,FL
9. Closing Costs. Seller will pay one-half of escrow fees, the
cost of the title commitment, one half of the cost of issuing a
standard Owners Title Insurance Policy in the full amount of the
purchase price, and any brokerage commissions payable. The Buyer
will pay for one half of the cost of issuing a standard Owners
Title Insurance Policy in the full amount of the purchase price,
if Buyer shall decide to purchase the same. Buyer will pay all
recording fees, one-half of the escrow fees, and the cost of an
update to the Survey in Sellers possession (if an update is
required by Buyer.) Each party will pay its own attorney's fees
and costs to document and close this transaction.
10. Real Estate Taxes, Special Assessments and Prorations.
(a) Because the Entire Property (of which the Property is a
part) is subject to a triple net lease (as further set forth
in paragraph 11(a)(i)), the parties acknowledge that there
shall be no need for a real estate tax proration. However,
Seller represents that to the best of its knowledge, all
real estate taxes and installments of special assessments
due and payable in all years prior to the year of Closing
have been paid in full. Unpaid 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 thereafter, if such unpaid
levied and pending special assessments and real estate taxes
are not paid by any tenant of the Entire Property.
(b) All income and all operating expenses from the Entire
Property shall be prorated between the parties and adjusted
by them as of the date of Closing. Seller shall be entitled
to all income earned and shall be responsible for all
expenses incurred prior to the date of Closing, and Buyer
shall be entitled to its proportionate share of all income
earned and shall be responsible for its proportionate shall
of all operating expenses of the Entire Property incurred on
and after the date of Closing.
11. Seller's Representation and Agreements.
(a) Seller represents and warrants as of this date that:
(i) Except for the lease in existence between AEI Real
Estate Fund XVIII Limited Partnership and T.S.S.O.,
Inc.("Tenant"), dated October 31, 1991 (as amended by letter
agreement dated September 21, 1995 between AEI and Tenant),
Seller is not aware of any leases of the Property. The
above referenced lease agreement has an option to purchase
in favor of the Tenant as set forth in article 35 of said
lease agreement.
(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 disclosed to Buyer in this Agreement,
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 prior to the Closing Date 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.
Buyer Initial: /s/ T.D. /s/ TH
Purchase Agreement for Applebee's - Destin,FL
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 the use and operation of 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 as provided under 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.
(f) Buyer acknowledges that, having been given the
opportunity to inspect the Property and such financial
information on the Tenant 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 Tenant and Guarantors of
Lease was obtained from a variety of sources and Seller
neither (a) has made independent investigation or
verification of such information, or (b) makes any
representations as to the accuracy or completeness of such
information. The sale of the Property as provided for
herein is made on an "AS IS" basis, and Buyer expressly
acknowledges that, in consideration of the agreements of
Seller herein, except as otherwise specified herein, Seller
makes no warranty or representation, express or implied, or
arising by operation of law, including, but not limited to,
any warranty or condition, habitability, tenantability,
suitability for commercial purposes, merchantability, or
fitness for a particular purpose, in respect of the
Property.
The provisions (d) - (f) above shall survive closing.
Buyer Initial: /s/ T.D. /s/ TH
Purchase Agreement for Applebee's - Destin,FL
13. Closing.
(a) Before the closing date, Seller will deposit into
escrow an executed limited warranty deed conveying insurable
title of the Property to Buyer, subject to the encumbrances
contained in paragraph 8 above.
(b) On or before the closing date, Buyer will deposit into
escrow: the balance of the purchase price when required
under Section 4; any additional funds required of Buyer,
(pursuant to this agreement or any other agreement executed
by Buyer) to close escrow. Both parties will sign the Co-
Tenancy Agreement, 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 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
Buyer Initial: /s/ T.D. /s/ TH
Purchase Agreement for Applebee's - Destin,FL
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 ten-day period provided for above in this Subparagraph
16a for Buyer to elect to terminate this Agreement has
expired or Buyer has, by written notice to Seller, waived
Buyer's right to terminate this Agreement. If Buyer elects
to proceed and to consummate the purchase despite said
damage or destruction, there shall be no reduction in or
abatement of the purchase price, and Seller shall assign to
Buyer the Seller's right, title, and interest in and to all
insurance proceeds (pro-rata in relation to the Entire
Property) resulting from said damage or destruction to the
extent that the same are payable with respect to damage to
the Property, subject to rights of any Tenant of the Entire
Property.
If the cost of repair is less than $10,000.00, Buyer shall
be obligated to otherwise perform hereinunder with no
adjustment to the Purchase Price, reduction or abatement,
and Seller shall assign Seller's right, title and interest
in and to all insurance proceeds pro-rata in relation to the
Entire Property, subject to rights of any Tenant of the
Entire Property.
(b) If, prior to closing, the Property, or any part
thereof, is taken by eminent domain, this Agreement shall
become null and void, at Buyer's option. If Buyer elects to
proceed and to consummate the purchase despite said taking,
there shall be no reduction in, or abatement of, the
purchase price, and Seller shall assign to Buyer the
Seller's right, title, and interest in and to any award
made, or to be made, in the condemnation proceeding pro-rata
in relation to the Entire Property, subject to rights of any
Tenant of the Entire Property.
In the event that this Agreement is terminated by Buyer as
provided above in Subparagraph 16a or 16b, the First Payment
shall be immediately returned to Buyer (after execution by Buyer
of such documents reasonably requested by Seller to evidence the
termination hereof).
17. Cancellation
If any party elects to cancel this Contract because of any
breach by another party, the party electing to cancel shall
deliver to escrow agent a notice containing the address of
the party in breach and stating that this Contract shall be
cancelled unless the breach is cured within 13 days
following the delivery of the notice to the escrow agent.
Within three days after receipt of such notice, the escrow
agent shall send it by United States Mail to the party in
breach at the address contained in the Notice and no further
notice shall be required. If the breach is not cured within
the 13 days following the delivery of the notice to the
escrow agent, this Contract shall be cancelled.
Buyer Initial: /s/ T.D. /s/ TH
Purchase Agreement for Applebee's - Destin,FL
18. 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 30, 1997
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:
Hoang-Do Family Living Trust
Truong Hoang, Trustee
Thanh Do, Trustee
3420 Kings Cove Ln
Chattanooga TN 37416
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.
Buyer Initial: /s/ T.D. /s/ TH
Purchase Agreement for Applebee's - Destin,FL
IN WITNESS WHEREOF, the Seller and Buyer have executed this
Agreement effective as of the day and year above first written.
BUYER: Hoang-Do Family Living Trust, dated
By: /s/ Truong Hoang
Truong Hoang, Trustee
WITNESS:
/s/ Michael Do
Michael Do
(Print Name)
WITNESS:
/s/ Mai Ha
Mai Ha
(Print Name)
By: /s/ Thanh Do
Thanh Do, Trustee
WITNESS:
/s/ Michael Do
Michael Do
(Print Name)
WITNESS:
/s/ Mai Ha
Mai Ha
(Print Name)
Buyer Initial: /s/ T.D. /s/ TH
Purchase Agreement for Applebee's - Destin,FL
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
WITNESS:
/s/ Dawn E Campbell
Dawn E Campbell
(Print Name)
WITNESS:
/s/ Jeni K Henrickson
Jeni K Henrickson
(Print Name)
Buyer Initial: /s/ T.D. /s/ TH
Purchase Agreement for Applebee's - Destin,FL
EXHIBIT A
Legal Description
Premises: APPLEBEE'S NEIGHBORHOOD GRILL & BAR
A portion of Section 26, Township 2 South. Range 21 West,
Walton County, Florida, being more particularly described as
follows:
Commence at the intersection with the East line of the
aforesaid Section 26 and the North Right-of-way Line of
State Road 30 (U.S. 98. 100' R/W); thence go North 77
degrees 09 minutes 03 seconds West along the aforesaid Right-
of-way line, a distance of 1233.51 feet to a point of
curvature: thence go along a curve to the left, having a
radius of 5779.65 feet, an arc distance of 1060.26 feet (CH.
= 1058.78', CH. BRG. = North 82 degrees 24 minutes 26
seconds West); thence departing the aforesaid North Right-of-
way line, go North 02 degrees 59 seconds 27 minutes East, a
distance of 10.00 feet to a point on a curve, being concave
southerly and having a radius of 5789.65 feet and the Point
of Beginning: thence go northwesterly along the aforesaid
curve, an arc distance of 180.00 feet (CH. = 179.99', CH.
BRG. = North 88 degrees 33 minutes 11 seconds West): thence
go North 02 degrees 59 minutes 27 seconds East, a distance
of 215.00 feet: thence go South 88 degrees 38 minutes 25
seconds East, a distance of 178.79 feet to a Point on a
curve, being concave southwesterly and having a radius of
44.90 feet: thence go Southeasterly along the aforesaid
curve, an arc distance of 10.44 feet (CHI. = 10.42'. CHI.
BRAG. = South 03 degrees 39 minutes 46 seconds East) to the
Point of Tangency: thence go South 02 degrees 59 minutes 27
seconds East, a distance of 204.89 feet to the Point of
Beginning.
EXCEPTING THEREFROM THAT PORTION
lying Northerly of and within 66 feet of the centerline of
survey of State Road 30 (US 98) Section 60020, Westerly of
Station 248+00 and lying Northerly of and within 67 feet of
said centerline of survey, between Station 248+00 and
Station 256+51 and lying Northerly of said centerline of
survey and within a transition from 67 feet at Station
256+51 to 87 feet at Station 256+76; and lying Northerly of
and within 110 feet of said centerline of survey, between
Station 256+76 and Station 257+36; and lying Northerly of
said centerline of survey and within a transition from 87
feet at Station 257+36 to 67 feet at Station 257+61; and
lying Northerly of and within 67 feet of said centerline of
survey Easterly of Station 257+611; said centerline to be
described and said Stations to be located as follows:
Commence on a capped rod (RLS # 1835) at the Southeast
corner of Sandestin Estates Subdivision, as per plat
recorded in Plat Book 4, Page 25 of the Public Records of
Walton County, Florida; thence South 44 16' 49" East 101.64
feet; thence North 83 48' 54" East 3476.74 feet (crossing
the East line of Section 27, Township 2 South, Range 21 West
and the West line of Section 26, Township 2 South 2 South,
Range 21 West) to the POINT OF BEGINNING of centerline of
survey to be described herein, said point being the
beginning of a curve, concave Southerly, having a radius of
5729.58 feet; thence run Northeasterly, Easterly and
Southeasterly 1302.52 feet along said curve, thru a central
angle of 13 o1' 31" to Station 248+00; thence continue
Southeasterly 695.62 feet along said curve, thru a central
angle of 6 57' 22" to the end of curve; thence South 76 12'
14" East 155.38 feet to Station 256+51; thence continue
South 76 12' 14" East 25.0 feet to Station 256+76; thence
continue South 76 12' 14" East 60.00 feet to Station 257+36;
thence continue South 76 12'14" East 25.0 feet to Station
257+61; thence continue South 76 12' 14" East 977.87 feet to
the East line of said Section 26 (West line of Section 25,
Township 2 South Range 21 West) at a point 4561.50 feet
South 1 50' 37" West of a four inch by four inch concrete
monument on the Northeast corner of said Section 26
(Northwest corner of said Section 25); thence continue South
76 12' 14" East 1359.55 feet to a point of intersection with
the Southerly extension of the Easterly line of Parcel A of
Tract 308 of said Section 25; and end of centerline of
survey herein described; said point being 518.40 feet South
2 00' 23" West of a capped rod (RLS # 2535) on the Northeast
corner of said partial A; containing 1080 square feet, more
or less.
PROPERTY CO-TENANCY
OWNERSHIP AGREEMENT
(Applebee's Restaurant - Destin, FL)
THIS CO-TENANCY AGREEMENT,
Made and entered into as of the 9th day of September, 1997, by
and between Truong Hoang, Trustee and Thanh Do, Trustee of the
Hoang-Do Family Living Trust, dated 8/19/97, (hereinafter called
"Hoang-Do"), and AEI Real Estate Fund XVIII Limited Partnership
(hereinafter called "Fund XVIII") (Hoang-Do, 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 23.6072% interest
in and to, and Hoang-Do presently owns an undivided 14.3409%
interest in and to, and Adamson Family Limited Partnership
presently owns an undivided 31.2892% interest in and to,and Kent
T. Wood and Kimberly Pasini Wood presently own an undivided
11.0814% interest in and to, and The John Pasini and Elvia Pasini
Trust presently own an undivided 12.6222% interest in and to; and
Joseph Nicoletta presently owns an undivided 7.0591% interest in
and to the land, situated in the City of Destin, County of
Walton, and State of Florida, (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 Hoang-Do'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 Hoang-Do 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, and Fund XVIII retains the sole
right to deal with, any property agent or tenant and to monitor,
execute and enforce the terms of leases of space within the
Premises, including but not limited to any amendments, consents
to assignment, sublet, releases or modifications to leases or
guarantees of lease or easements affecting the Premises, on
behalf of Hoang-Do. Only Fund XVIII may obligate Hoang-Do with
respect to any expense for the Premises.
Co-Tenant Initial:
Co-Tenancy Agreement for Applebee's Restaurant - Destin, FL
As further set forth in paragraph 2 hereof, Fund XVIII
agrees to require any Tenant of the Premises to name Hoang-Do 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 Tenant 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.
2. Income and expenses shall be allocated among the Co-Tenants
in proportion to their respective share(s) of ownership. Shares
of net income shall be pro-rated for any partial calendar years
included within the term of this Agreement. Fund XVIII may offset
against, pay to itself and deduct from any payment due to Hoang-
Do under this Agreement, and may pay to itself the amount of
Hoang-Do's share of any legitimate expenses of the Premises which
are not paid by Hoang-Do 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 Hoang-Do'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
Tenant under terms of any lease agreement of the Premises.
Hoang-Do has no requirement to, but has, nonetheless, elected to
retain, and agrees to annually reimburse, Fund XVIII in the
amount of $720 for the expenses, direct and indirect, incurred by
Fund XVIII in providing Hoang-Do with quarterly accounting and
distributions of Hoang-Do's share of net income and for tracking,
reporting and assessing the calculation of Hoang-Do's share of
operating expenses incurred from the Premises. This invoice
amount shall be pro-rated for partial years and Hoang-Do
authorizes Fund XVIII to deduct such amount from Hoang-Do's share
of revenue from the Premises. Hoang-Do may terminate this
agreement in this paragraph respecting accounting and
distributions at any time and seek to collect its share of rental
income directly from the tenant; however, enforcement of all
other provisions of the lease remains the sole right of Fund
XVIII pursuant to Section 1 hereof. Fund XVIII may terminate its
obligation under this paragraph upon 30 days notice to Hoang-Do
prior to the end of each anniversary hereof, unless agreed in
writing to the contrary.
3. Full, accurate and complete books of account shall be kept
in accordance with generally accepted accounting principles at
Fund 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, Hoang-Do
shall be entitled to receive 14.3409% of all items of income and
expense generated by the Premises. Upon receipt of said
accounting, if the payments received by each Co-Tenant pursuant
to this Paragraph 3 do not equal, in the aggregate, the amounts
which each are entitled to receive proportional to its share of
ownership with respect to said calendar year pursuant to
Paragraph 2 hereof, an appropriate adjustment shall be made so
that each Co-Tenant receives the amount to which it is entitled.
4. If Net Income from the Premises is less than $0.00 (i.e.,
the Premises operates at a loss), or if capital improvements,
repairs, and/or replacements, for which adequate reserves do not
exist, need to be made to the Premises, the
Co-Tenant Initial: /s/ TH /s/ TD
Co-Tenancy Agreement for Applebee's Restaurant - Destin, FL
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.
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
October 31, 2021 or upon the sale of the entire Premises in
accordance with the terms hereof and proper disbursement of the
proceeds thereof, whichever shall first occur. Unless
specifically identified as a personal contract right or
obligation herein, this agreement shall run with any interest in
the Property and with the title thereto. Once any person, party
or entity has ceased to have an interest in fee in any portion of
the Entire Property, it shall not be bound by, subject to or
benefit from the terms hereof; but its heirs, executors,
administrators, personal representatives, successors or assigns,
as the case may be, shall be substituted for it hereunder.
8. Any notice or election required or permitted to be given or
served by any party hereto to, or upon any other, shall be deemed
given or served in accordance with the provisions of this
Agreement, if said notice or elections addressed as follows;
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 Hoang-Do Family Living Trust:
Truong Hoang, Trustee
Thanh Do, Trustee
3420 Kings Cove Ln
Chattanooga, Tenn 37446
Co-Tenant Initial: /s/ TH /s/ TD
Co-Tenancy Agreement for Applebee's Restaurant - Destin, FL
If to Adamson:
The Thomas W. Adamson Family Limited Partnership
Gerald Adamson
206 Palm Avenue
Bullhead City, AZ 86430
Wayne Adamson
1400 W. Walnut
Marion, IL 62959
If to Wood:
Kent T. Wood and Kimberly Pasini Wood
1550 Monte Vista Drive
Reno, NV 89509
If to Pasini:
John Pasini and Elvia Pasini, Trustees
4000 Bitter Creek Court
Reno, NV 89509
If to Nicoletta:
Joseph Nicoletta
5727 Camellia
North Hollywood, CA 91601
Each mailed notice or election shall be deemed to have been given
to, or served upon, the party to which addressed on the date the
same is deposited in the United States certified mail, return
receipt requested, postage prepaid, or given to a nationally
recognized courier service guaranteeing overnight delivery as
properly addressed in the manner above provided. Any party hereto
may change its address for the service of notice hereunder by
delivering written notice of said change to the other parties
hereunder, in the manner above specified, at least ten (10) days
prior to the effective date of said change.
9. This Agreement shall not create any partnership or joint
venture among or between the Co-Tenants or any of them, and the
only relationship among and between the Co-Tenants hereunder
shall be that of owners of the premises as tenants in common
subject to the terms hereof.
10. The unenforceability or invalidity of any provision or
provisions of this Agreement as to any person or circumstances
shall not render that provision, nor any other provision hereof,
unenforceable or invalid as to any other person or circumstances,
and all provisions hereof, in all other respects, shall remain
valid and enforceable.
11. In the event any litigation arises between the parties
hereto relating to this Agreement, or any of the provisions
hereof, the party prevailing in such action shall be entitled to
receive from the losing party, in addition to all other relief,
remedies and damages to which it is otherwise entitled, all
reasonable costs and expenses, including reasonable attorneys'
fees, incurred by the prevailing party in connection with said
litigation.
Co-Tenant Initial: /s/ TH /s/ TD
Co-Tenancy Agreement for Applebee's Restaurant - Destin, FL
IN WITNESS WHEREOF, The parties hereto have caused this Agreement
to be executed and delivered, as of the day and year first above
written.
Hoang-Do Hoang-Do Family Living Trust, dated
By: /s/ Truong Hoang
Truong Hoang, Trustee
WITNESS:
/s/ Monica Jefferson
Monica Jefferson
(Print Name)
WITNESS:
/s/ Michelle Eaton
Michelle Eaton
(Print Name)
State of Tennessee )
) ss.
County of Hamelton )
The foregoing instrument was acknowledged before me, a
Notary Public in and for the County and State aforesaid,
this 19th day of August,1997, by Monica Jefferson, Notary
Public.
/s/ Monica Jefferson
Notary Public
exp 10-11-97
The remainder of this page intentionally left blank.
Co-Tenant Initial: /s/ TH /s/ TD
Co-Tenancy Agreement for Applebee's Restaurant - Destin, FL
By: /s/ Thanh Do
Thanh Do, Trustee
WITNESS:
/s/ Monica Jefferson
Monica Jefferson
(Print Name)
WITNESS:
/s/ Michelle Eaton
Michelle Eaton
(Print Name)
State of Tennessee )
) ss.
County of Hamilton )
The foregoing instrument was acknowledged before me, a
Notary Public in and for the County and State aforesaid,
this 19th day of August, 1997, by Monica Jefferson, Notary
Public.
/s/ Monica Jefferson
Notary Public
exp 10-11-97
The remainder of this page intentionally left blank.
Co-Tenant Initial: /s/ TH /s/ TD
Co-Tenancy Agreement for Applebee's Restaurant - Destin, FL
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:
/s/ Dawn E Campbell
Dawn E Campbell
(Print Name)
WITNESS:
/s/ Brian K Schulz
Brian K Schulz
(Print Name)
State of Minnesota )
) ss.
County of Ramsey )
I, a Notary Public in and for the state and county of aforesaid,
hereby certify there appeared before me this 9th day of
September, 1997, Robert P. Johnson, President of AEI Fund
Management XVIII, Inc., corporate general partner of AEI Real
Estate Fund XVIIII 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/ Laura M Steidl
Notary Public
[notary seal]
Co-Tenant Initial: /s/ TH /s/ TD
Co-Tenancy Agreement for Applebee's Restaurant - Destin, FL
EXHIBIT A
Legal Description
Premises: APPLEBEE'S NEIGHBORHOOD GRILL & BAR
A portion of Section 26, Township 2 South. Range 21 West,
Walton County, Florida, being more particularly described as
follows:
Commence at the intersection with the East line of the
aforesaid Section 26 and the North Right-of-way Line of
State Road 30 (U.S. 98. 100' R/W); thence go North 77
degrees 09 minutes 03 seconds West along the aforesaid Right-
of-way line, a distance of 1233.51 feet to a point of
curvature: thence go along a curve to the left, having a
radius of 5779.65 feet, an arc distance of 1060.26 feet (CH.
= 1058.78', CH. BRG. = North 82 degrees 24 minutes 26
seconds West); thence departing the aforesaid North Right-of-
way line, go North 02 degrees 59 seconds 27 minutes East, a
distance of 10.00 feet to a point on a curve, being concave
southerly and having a radius of 5789.65 feet and the Point
of Beginning: thence go northwesterly along the aforesaid
curve, an arc distance of 180.00 feet (CH. = 179.99', CH.
BRG. = North 88 degrees 33 minutes 11 seconds West): thence
go North 02 degrees 59 minutes 27 seconds East, a distance
of 215.00 feet: thence go South 88 degrees 38 minutes 25
seconds East, a distance of 178.79 feet to a Point on a
curve, being concave southwesterly and having a radius of
44.90 feet: thence go Southeasterly along the aforesaid
curve, an arc distance of 10.44 feet (CHI. = 10.42'. CHI.
BRAG. = South 03 degrees 39 minutes 46 seconds East) to the
Point of Tangency: thence go South 02 degrees 59 minutes 27
seconds East, a distance of 204.89 feet to the Point of
Beginning.
EXCEPTING THEREFROM THAT PORTION
lying Northerly of and within 66 feet of the centerline of
survey of State Road 30 (US 98) Section 60020, Westerly of
Station 248+00 and lying Northerly of and within 67 feet of
said centerline of survey, between Station 248+00 and
Station 256+51 and lying Northerly of said centerline of
survey and within a transition from 67 feet at Station
256+51 to 87 feet at Station 256+76; and lying Northerly of
and within 110 feet of said centerline of survey, between
Station 256+76 and Station 257+36; and lying Northerly of
said centerline of survey and within a transition from 87
feet at Station 257+36 to 67 feet at Station 257+61; and
lying Northerly of and within 67 feet of said centerline of
survey Easterly of Station 257+611; said centerline to be
described and said Stations to be located as follows:
Commence on a capped rod (RLS # 1835) at the Southeast
corner of Sandestin Estates Subdivision, as per plat
recorded in Plat Book 4, Page 25 of the Public Records of
Walton County, Florida; thence South 44 16' 49" East 101.64
feet; thence North 83 48' 54" East 3476.74 feet (crossing
the East line of Section 27, Township 2 South, Range 21 West
and the West line of Section 26, Township 2 South 2 South,
Range 21 West) to the POINT OF BEGINNING of centerline of
survey to be described herein, said point being the
beginning of a curve, concave Southerly, having a radius of
5729.58 feet; thence run Northeasterly, Easterly and
Southeasterly 1302.52 feet along said curve, thru a central
angle of 13 o1' 31" to Station 248+00; thence continue
Southeasterly 695.62 feet along said curve, thru a central
angle of 6 57' 22" to the end of curve; thence South 76 12'
14" East 155.38 feet to Station 256+51; thence continue
South 76 12' 14" East 25.0 feet to Station 256+76; thence
continue South 76 12' 14" East 60.00 feet to Station 257+36;
thence continue South 76 12'14" East 25.0 feet to Station
257+61; thence continue South 76 12' 14" East 977.87 feet to
the East line of said Section 26 (West line of Section 25,
Township 2 South Range 21 West) at a point 4561.50 feet
South 1 50' 37" West of a four inch by four inch concrete
monument on the Northeast corner of said Section 26
(Northwest corner of said Section 25); thence continue South
76 12' 14" East 1359.55 feet to a point of intersection with
the Southerly extension of the Easterly line of Parcel A of
Tract 308 of said Section 25; and end of centerline of
survey herein described; said point being 518.40 feet South
2 00' 23" West of a capped rod (RLS # 2535) on the Northeast
corner of said partial A; containing 1080 square feet, more
or less.
PURCHASE AGREEMENT
Taco Cabana, San Antonio, TX
This AGREEMENT, entered into effective as of the 9 of September,
1997 .
l. Parties. Seller is AEI Real Estate Fund XVIII Limited
Partnership ("Seller"), which presently holds an undivided
50.7347% interest in the fee title to that certain real property
legally described in the attached Exhibit "A". (the "Entire
Property") Buyer is Nick DeVito, Inc., a California Corporation
("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 15.6724% percentage interest
(hereinafter, simply the "Property") as Tenant in Common in the
Entire Property. To the best of Seller's knowledge, the purchase
of the Property is the purchase of an interest in real property
under Texas law.
3. Purchase Price . The purchase price for this percentage
interest in the Property is $305,000 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, or otherwise dispersed
pursuant to the terms of this Agreement.
(b) Buyer will deposit the balance of the purchase price,
$300,000 (the "Second Payment") into escrow in sufficient
time to allow escrow to close on the Closing Date.
(c) Seller hereby acknowledges receipt of the sum of $50.00
cash (the "Option Consideration") from Buyer, as
consideration for execution of this Agreement by Seller. If
the purchase and sale of the Property is consummated
pursuant to this Agreement, the Option Consideration shall
be applied toward the purchase price paid by Buyer. If this
Agreement is terminated pursuant to a default by Seller
hereunder, the Option Consideration shall be immediately
returned by Seller to Buyer. If this Agreement is
terminated for any reason other than a default by Seller
hereunder, Seller shall be entitled to retain the Option
Consideration.
5. Closing Date. Escrow shall close on or before September 30,
1997.
6. Due Diligence. Buyer will have until the expiration of the
fifth business day (The "Review Period") after delivery of each
of following items, to be supplied by Seller, to conduct all of
its inspections and due diligence and satisfy itself regarding
each item, the Property, and this transaction. Buyer agrees to
indemnify and hold Seller harmless for any loss or damage to the
Leased Premises or persons caused by Buyer or its agents arising
out of such physical inspections of the Entire Property.
(a) The original and one copy of a title insurance
commitment for an Owner's Title insurance policy (see
paragraph 8 below).
(b) Copies of a Certificate of Occupancy or other such
document certifying completion and granting permission to
permanently occupy the improvements on the Entire Property
as are in Seller's possession.
Buyer Initial: /s/ V.D.F
Purchase Agreement for Taco Cabana - San Antonio, TX
(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 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. Such notice shall be deemed effective only
upon receipt by Seller. If this Agreement is not canceled as set
forth above, the First Payment shall be non-refundable unless
Seller shall default hereunder.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under 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.
Unless this Agreement is canceled by Buyer pursuant to the
terms hereof, if Buyer fails to make the Second Payment, Seller
shall be entitled to retain the First Payment and Buyer
irrevocably will be deemed to have canceled this Agreement and
relinquish all rights in and to the Property. If this Agreement
is not canceled and the Second Payment is made when required, all
of Buyer's conditions and contingencies will be deemed satisfied.
7. Escrow. Escrow shall be opened by Seller and funds deposited
in escrow upon acceptance of this Agreement by both parties. The
escrow holder will be a nationally-recognized escrow company
selected by Seller. A copy of this Agreement will be delivered to
the escrow holder and will serve as escrow instructions together
with the escrow holder's standard instructions and any additional
instructions required by the escrow holder to clarify its rights
and duties (and the parties agree to sign these additional
instructions). If there is any conflict between these other
instructions and this Agreement, this Agreement will control.
8. Title. Closing will be conditioned on the commitment of a
title company selected by Seller to issue an Owner's policy of
title insurance, dated as of the close of escrow, in an amount
equal to the purchase price, insuring that Buyer will own
insurable title to the Property subject only to: the title
company's standard exceptions; current real property taxes and
assessments; survey exceptions; the rights of parties in
possession pursuant to the lease defined in paragraph 11 below;
and other items of record disclosed to Buyer during the Review
Period.
Buyer shall be allowed five (5) days after receipt of said
commitment for examination and the making of any objections to
marketability thereto, said objections to be made in writing or
deemed waived. If any objections are so made, the Seller shall
be allowed eighty (80) days to make such title marketable or in
the alternative to obtain a commitment for insurable title
insuring over Buyer's objections. If Seller shall decide to make
no efforts to make title marketable, or is unable to make title
marketable or obtain insurable title, (after execution by Buyer
of such documents reasonably requested by Seller to evidence the
termination hereof) Buyer's First Payment shall be returned and
this Agreement shall be null and void and of no further force and
effect.
Buyer Initial: /s/ V.D.F
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 except those brokerage commissions incurred by Buyer.
The buyer will pay the cost of issuing a Standard Owners Title
Insurance Policy in the full amount of the purchase price if
Buyer desires to purchase the same. Buyer will pay all recording
fees, one-half of the escrow fees, and the cost of an update to
the Survey in Sellers possession (if an update is required by
Buyer.) Each party will pay its own attorney's fees and costs to
document and close this transaction.
10. Real Estate Taxes, Special Assessments and Prorations.
(a) Because the Entire Property (of which the Property is a
part) is subject to a triple net lease (as further set forth
in paragraph 11(a)(i), the parties acknowledge that there
shall be no need for a real estate tax proration. However,
Seller represents that to the best of its knowledge, all
real estate taxes and installments of special assessments
due and payable in all years prior to the year of Closing
have been paid in full. Unpaid levied and pending special
assessments existing on the date of Closing shall be the
responsibility of Buyer and Seller in proportion to their
respective Tenant in Common interests, pro-rated, however,
to the date of closing; for the period prior to closing,
such taxes and asessments shall be the responsibility of
Seller, if Tenant shall not pay the same. Seller and Buyer
shall likewise pay in proportion to their ownership
interests all taxes due and payable in the year after
Closing and any unpaid installments of special assessments
payable therewith and thereafter, if such unpaid levied and
pending special assessments and real estate taxes are not
paid by any tenant of the Entire Property.
(b) All income and all operating expenses from the Entire
Property shall be prorated between the parties and adjusted
by them as of the date of Closing. Seller shall be entitled
to all income earned and shall be responsible for all
expenses incurred prior to the date of Closing, and Buyer
shall be entitled to its proportionate share of all income
earned and shall be responsible for its proportionate share
of all operating expenses of the Property incurred on and
after the date of closing, if the same are not paid by any
tenant of the Entire Property.
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. ("Lessee"), 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". The above referenced lease agreement has an
option to purchase in favor of the Lessee as set forth in
article 34 of said lease agreement.
(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/ V.D.F
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 prior to the Closing Date 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 the use and operation of 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 gross negligence or
intentional misconduct.
(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
Buyer Initial: /s/ V.D.F
Purchase Agreement for Taco Cabana - San Antonio, TX
information provided by Seller or to be provided except as
set forth herein. Buyer further acknowledges that the
information provided and to be provided by Seller with
respect to the Property and to the Lessee and Guarantors of
Lease was obtained from a variety of sources and Seller
neither (a) has made independent investigation or
verification of such information, or (b) makes any
representations as to the accuracy or completeness of such
information. The sale of the Property as provided for
herein is made on an "AS IS" basis, and Buyer expressly
acknowledges that, in consideration of the agreements of
Seller herein, except as otherwise specified herein, Seller
makes no warranty or representation, express or implied, or
arising by operation of law, including, but not limited to,
any warranty or condition, habitability, tenantability,
suitability for commercial purposes, merchantability, or
fitness for a particular purpose, in respect of the
Property.
The provisions (d) - (f) above shall survive closing.
13. Closing.
(a) Before the Closing Date, Seller will deposit into
escrow an executed special warranty deed conveying insurable
title of the Property to Buyer, subject to the encumbrances
contained in paragraph 8 above.
(b) On or before the Closing Date, Buyer will deposit into
escrow: the balance of the purchase price when required
under Section 4; any additional funds required of Buyer,
(pursuant to this agreement or any other agreement executed
by Buyer) to close escrow. Both parties will sign the Co-
Tenancy Agreement, 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
owners title policy purchase by Buyer; 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 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,
Buyer Initial: /s/ V.D.F
Purchase Agreement for Taco Cabana - San Antonio, TX
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 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
Buyer Initial: /s/ V.D.F
Purchase Agreement for Taco Cabana - San Antonio, TX
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 Exodus Exchange, Inc. who
will act as Facilitator to perfect the 1031 exchange by preparing
an agreement of exchange of Real Property whereby Exodus
Exchange, 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 Exodus Exchange, 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, 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
canceled 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 canceled.
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 30, 1997
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.
Buyer Initial: /s/ V.D.F
Purchase Agreement for Taco Cabana - San Antonio, TX
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:
Vito DeVito Francesco, Secretary/Treasurer
P.O. Box 591
Ontario, CA 91762
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: NICK DEVITO, INC.
By:/s/ Vito DeVito Francesco
Vito DeVito Francesco, Secretary/Treasurer
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/ V.D.F
Purchase Agreement for Taco Cabana - San Antonio, TX
Exhibit A
Legal Description
Lot 31, Blck 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.
EXHIBIT B
CONSENTS AND ACKNOWLEDGMENTS CONCERNING
NET LEASE AGREEMENT
This Consents and Acknowledgments Concerning Net Lease
Agreement (the "Consent") is executed this 2nd day of June,
1994, by and between AEI Real Estate Fund XVIII Limited
Parntership (the "Landlord"), Taco Cabana, Inc. ("TC") and
Felix L. Stehling and Billie Jo Stehling (the "Guarantor").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Net Lease Agreement
dated July 19, 1991 (the "Lease"), Landlord leased to TC
those certain restaurant premises, located at 6867 New
Highway 90 West, San Antonio, Texas (the "Premises"); and
WHEREAS, pursuant to that certain General Assignment
and Assumption of Leases, Contracts and Rights (the "First
Assignment") dated October 31, 1993, TC assigned all of its
right, title and interest in and to the Lease to TC Lease
Holdings III, V and VI, Inc.; and
WHEREAS, pursuant to that certain General Assignment
and Assumption of Leases Contracts and Rights (the "Second
Assignment") dated October 31, 1993, TC Lease Holding II, V
and VI, Inc. assigned all of its right, title and interest
in and to the Lease to Texas Taco Cabana, L.P. ("Taco
L.P."); and
WHEREAS, the parties hereto desire to consent to the
aforesaid assignments and to acknowledge their continuing
liability under the Lease.
NOW, THEREFORE, the parties hereto agree as follows:
1. Landlord hereby expressly consents to the
assignments of the Lease pursuant to the terms of the First
Assignment and the Second Assignment. Landlord acknowledges
and agrees that such assignments do not constitue any type
of breach or default under the Lease and that the Taco L.P.
shall be entitled to all of the rights and obligations of
the "Tenant" under the Lease.
2. TC herby expressly consents to the assignments of
the Lease pursuant to the terms of the First Assignment and
the Second Assignment. TC acknowledges and agrees that is
shall remain fully liable for all of the obligations of the
"Tenant" under the Lease.
3. Guarantor herby expressly consents to the
assignments of the Lease pursuant to the terms of the First
Assignment and the Second Assignment. Grantor acknowledges
and agrees that he shall remain fully liable for all of the
obligations of the "Guarantor" under that certain Guarantee
of Lease dated July 19, 1991, executed in connection with
the Lease.
4. This Agreement and each and every covenant,
agreement, and other provision hereof shall be binding upon
and shall inure to the benefit of, the parties hereto and
their respective heirs, administrators, representatives,
successors and assigns.
EXECUTED the day and year first written above.
AEI REAL ESTATE FUND XVIII TACO CABANA, INC.
LIMITED PARTNERSHIP
BY: AEI Fund Management XVIII, BY: /s/ James A Eliasberg
Inc., General Partner NAME: James A Eliasberg
TITLE: Senior Vice President,
General Counsel
BY: /s/ Robert P Johnson
NAME: Robert P Johnson /s/ Felix L Stehling
TITLE: Pres Felix L Stehling
/s/ Billie Jo Stehling
Billie Jo Stehling
THE STATE OF MINNESOTA
COUNTY OF RAMSEY
The foregoing instrument was acknowledged before me
this 2nd day of June, 1994, by Robert P Johnson, President
of AEI Fund Management XVIII, Inc., General Partner of AEI
Real Estate Fund XVIII Limited Partnership on behalf of said
limited partnership.
/s/ Michael B Daugherty
[notary seal] Notary Public in and for
The State of Minnesota
THE STATE OF TEXAS
COUNTY OF BEXAR
The foregoing instrument was acknowledged before me
this 27th day of May, 1994, by James A Eliasberg, Senior
Vice Presidetn, General Counsel of Taco Cabana, Inc., a
Delaware corporation, on behalf of the corporation.
/s/ Michelle Rocher
Notary Public in and for The
State of Texas
THE STATE OF TEXAS
COUNTY OF BEXAR
This instrument was acknowledged before me on the 26th
day of May, 1994, by Felix L. Stehling and Billie Jo
Stehling.
/s/ Diane L. Troy
Notary Public in and for
The State of Texas
GENERAL ASSIGNMENT AND ASSUMPTION OF LEASES,
CONTRACTS AND RIGHTS
THE STATE OF TEXAS
COUNTY OF BEXAR
KNOW ALL MEN BY THESE PRESENTS:
That TACO CABANA, INC., a Delaware corporation
(hereinafter referred to as "Assignor"), whose address is
262 Losoya, Suite 330, San Antonio, Bexar County, Texas
78205, for and in consideration of the sum of Ten Dollars
and No/100 Dollars ($10.00), cash, and other good and
valuable consideration to it paid by TC LEASE HOLDINGS III,
V and VI, INC., a Texas corporation, whose business address
is 262 Losoya, Suite 330 San Antonio, Bexar County, Texas
78205, (hereinafter referred to as "Assignee"), has
ASSIGNED, SOLD and TRANSFERRED, and by these presents does
ASSIGN, SELL and TRANSFER, unto Assignee all of the
following:
(a) All right, titles, and interest of Assignor, as a
tenant or lessee, as the case may be, under all leases with
a landlord or lessor, as the case may be, for the operation
of "Taco Cabana" restaurants located in the State of Texas
(all said leases being listed on Exhibit A hereto and being
hereinafter referred to collectively as the "Leases"),
together with all contractual rights and benefits accruing
to tenant or lessee, as the case may be, pursuant to said
Leases on and after the date of delivery of this instrument;
and
(b) All of Assignor's rights and interests, if any, to
the extent assignable, under all warranties and guaranties
relating to the property and rights that are the subject of
the Leases (all said rights and interests being hereinafter
referred to collectively as the "Rights"); and
(c) All of Assignor's right, title, and interest, if
any, to the extent assignable, in maintenance, management,
service and other contracts and agrrments relating to the
property and rights that are the subject of the Leases (all
said contracts and agreements being hereinafter referred to
collectively as the "Service Agreements").
But, with respect to any particular Lease, and the
Rights and Services Agreements related thereto, if any, this
assignment, sale and transfer is made by Assignor and
accepted by Assignee subject to the consent of the landlord
or lessor, as the case may be, under such Lease (hereafter,
the Landlord"), and of the contracting parties other than
Assignor under any such related Rights and Services
Agreement, to the extent such consent is required in order
to effect the transfers contemplated herein.
Taco Cabana, Inc.
(DEL)
A. T.C. Management, Inc. B. TC Lease Holdings C. Taco Cabana
(DEL) III, V and VI, Inc. (TX)Investments,Inc.
(DEL)
D. Taco Cabana Management, Inc E. Get Real, Inc.
(TX) General Partner (DEL) Limited Partner
F. Texas Taco Cabana, L.P.
(TX)
TO HAVE AND TO HOLD said Leases, Rights and Service
Agreements, together with all and singular the rights and
appurrenances thereto in anywise belonging unto the said
Assignee, his heirs and assigns, forever, without warranty.
As a further part of the consideration to Asignor for
the sale, transfer and assignment of said Leases, Rights and
Service Agreements, Assignee, by acceptance hereof, hereby
assumes and agrees to perform all of the responsibilities
and obligations of Assignor under said Leases, Rights and
Service Agreements arising and accruing from and after the
effective date of this instrument; provided that, to the
extent that prior to such effective date Assignor was
obligated to perform such responsibilities and obligations
pursuant to said Leases, Rights and Service Agreements,
Assignor shall from and after the effective date remain
obligated to perform such responsibilites and obligations,
if Assignee fails to perform such responsibilities and
obligations.
Assignee acknowledges receipt from Assignor of all
Assignor's interests, if any, in security deposits Assignor
has paid to or deposited with any Landlord pursuant to the
Leases.
This Assignment of Leases, Rights and Service
Agreements may be executed in one or more counterparts, and
each such counterpart, when so executed and delivered, shall
constitute but one and the same instrument.
A facsimile of an executed couterpart of this
instrument shall be deemed to be an original executed
couterpart.
EXECUTED on the dates set forth below to be effective
as of the 31st day of October, 1993.
ASSIGNOR: ASSINGEE
TACO CABANA, INC. TC LEASE HOLDINGS III, V and VI,
a Delaware Corporation INC., a Texas corporation
By: /s/ Richard Cervera By: /s/ Richard Cervera
Printed Name: Richard Cervera Printed Name: Richard Cervera
Title: President Title: President
THE STATE OF TEXAS
COUNTY OF BEXAR
Before me, the undersigned authority, on this day
personally appeared Richard Cervera, President of TACA
CABANA, INC., a Delaware corporation, known to me to be the
person and officer whose name is subscribed to the foregoing
instrument, and acknowledged to me that he executed the same
for the purposes and consideration therein expressed, in the
capacity therein stated and as the act and deed of said
coporation.
Given under my hand and seal of office this 28th day of
October, 1993.
By: /s/ J. Gayle Gawlik
Printed Name: Gayle Gawlik
Notary Publice in and for
Bexar County, Texas
My commission expires:
06-09-97 [notary seal]
THE STATE OF TEXAS
COUNTY OF BEXAR
Before me, the undersigned authority, on this day
personally appeared Richard Cervera, President of TC LEASE
HOLDINGS III, V and VI, INC., a Texas corporation, known to
me to be ther person and officer whose name is subscribed to
the foregoing instrument, and acknowledged to me that he
executed the same for the purposes and consideration therein
expressed, in the capacity therein stated and as the act and
deed of said corporation.
Given under my hand and seal of office this 28th day of
October, 1993.
By: /s/ J Gayle Gawlik
Printed Name: J. Gayle Gawlik
Notary Publice in and for
Bexar County, Texas
My commission expires:
06-09-97
[notary seal]
Taco Cabana, Inc.
(DEL)
A. T.C. Management, Inc. B. TC Lease Holdings C. Taco Cabana
(DEL) III, V and VI, Inc. (TX)Investments,Inc.
(DEL)
D. Taco Cabana Management, Inc E. Get Real, Inc.
(TX) General Partner (DEL) Limited Partner
F. Texas Taco Cabana, L.P.
(TX)
GENERAL ASSIGNMENT AND ASSUMPTION OF LEASES,
CONTRACTS AND RIGHTS
THE STATE OF TEXAS
COUNTY OF BEXAR
KNOW ALL MEN BY THESE PRESENTS:
That TC LEASE HOLDINGS III, V and VI, INC., a Texas
corporation (hereinafter referred to as "Assignor"), whose
address is 262 Losoya, Suite 330, San Antonio, Bexar County,
Texas 78205, for and in consideration of the sum of Ten
Dollars and No/100 Dollars ($10.00), cash, and other good
and valuable consideration to it paid by TEXAS TACO CABANA,
L.P., a Texas limited partnership, whose addres is 262
Losoya, Suited 330, San Antonio, Bexar County, Texas 78205,
(hereinafter referred to as "Assignee"), has ASSIGNED SOLD
and TRANSFERRED, and by these presents does ASSIGN, SELL and
TRANSFER, unto Assignee all of the following:
(a) All right, title, and interest of Assignor, as a
tenant or lessee, as the case may be, under all leases with
a landlord or lessor, as the case may be, for the operation
of "Taco Cabana" restaurants located in the State of Texas,
which leases were assigned to Assignor by Taco Cabana, Inc.
(a Delaware corporation) on the same date of but immediately
preceding this assignment (all said leases being listed on
Exhibit A hereto and being together with all contractual
rights and benefits accruing to tenant or lessee, as the
case may be, pursuant to said Leases on and after the date
of delivery of this instrument; and
(b) All of Assignor's rights and interests, if any,j
to the extent assignable, under all warranties and
guaranties relating to the property and rights that are the
subject of the Leases (all said rights and interests being
hereinafter referred to collectively as the "Rights"); and
(c) All of Assignor's right, title, and interest, if
any, to the extent assignable, in maintenance, management,
service and other contracts and agreements relating to the
property and rights that are the subject of the Leases (all
said contracts and agreements being hereinafter referred to
collectively as the "Service Agreements").
But, with respect to any particular Lease, and the
Rights and Services Agreements related thereto, if any, this
assignment, sale and transfer is made by Assignor and
accepted by Assignee subject to the consent of the landlord
or lessor, as the case may be, under such Lease (hereafter,
the Landlord"), and of the contracting parties other than
Assignor under any such related Rights and Services
Agreements, to the extent such consent is required in order
to effect the transfers contemplated herein.
TO HAVE AND TO HOLD said Leases, Rights and Service
Agreements, together with all and singular the rights and
appurtenances thereto in anywise beloinging unto the said
Assignee, his heirs and assigns, forever, without warranty.
As a further part of the consideration to Assignor for
the sale, transfer and assignment of said Leases, Rights and
Service Agreements, Assignee, by acceptance hereof, hereby
assumes and agrees to perform all of the responsibilities
and obligations of Assignor under said Leases, Rights and
Service Agreements arising and accruing from and after the
effective date of delivery of this instrument; provided
that, to the extent that prior to such effective date
Assignor was obligated to perform such responsibilities and
obligations pursuant to said Leases, Rights and Service
Agreement, Assignor shall from and after the effective date
reamin obligated to perform such responsibilities and
obligations, if Assignee fails to perform such
responsibilities and obligations.
Assignee acknowledges receipt from Assignor of all
Assignor's interests, if any, in security deposits Assignor
has paid to or deposited with any Landlord pursuant to the
Leases.
This Assignment of Leases, Rights and Service
Agreements may be executed in one or more counterparts, and
each such conuterjpart, when so executed and delivered,
shall constitute an original instrument, ans all such
separate counterparts shall constitute but one and the same
instrument.
A facsimile of an executed counterpart of this
instrument shall be deemed to be an original executed
counterpart.
EXECUTED on the dates set forth below to be effective
as of the 31st day of October, 1993.
ASSIGNOR: ASSINGEE:
TC LEASE HOLDINGS III, V AND VI, TEXAS TACO CABANA, L.P. A
INC., a Texas corporation Texas limited partnership
By: /s/ Richard Cervera By: /s/ Richard Cervera
Printed Name: Richard Cervera Printed Name: Richard Cervera
Title: President Title: President
THE STATE OF TEXAS
COUNTY OF BEXAR
Before me, the undersigned authority, on this day
personally appeared Richard Cervera, President of TC LEASE
HOLDINGS III, V and VI, INC., a Texas corporation, known to
me to be the person and officer whose name is subscribed to
the foregoing instrument, and acknowledged to me that he
executed the same for the purposes and consideration therein
expressed, in the capacity therein stated and as the act and
deed of said corporation.
Given under my hand and seal of office this 28 day of
October, 1993.
By: /s/ J. Gayle Gawlik
Printed Name: J. Gayle Gawlik
Notary Publice in and for
Bexar County, Texas
My commission expires:
06-09-97 [notary seal]
THE STATE OF TEXAS
COUNTY OF BEXAR
Before me, the undersigned authority, on this day
personally appeared Richard Cervera, President of TACO
CABANA MANAGEMENT, INC., a Texas corporation, the general
partner of TEXAS TACO CABANA, L.P., a Texas limited
partnership, known to me to be the preson and officer whose
name is subscribed to the foregoing instrument, and
acknowledged to me that he executed the same for the
purposes and consideration therein expressed, in the
capacity therein stated, and as the act and deed of said
corporation acting as said general partner.
Given under my hand and seal of office this 28 day of
October, 1993.
By: /s/ J. Gayle Gawlik
Printe Name: J. Gayle Gawlik
Notary Public in and for
Bexar County, Texas
My commission expires:
06-09-97 [notary seal]
PROPERTY CO-TENANCY
OWNERSHIP AGREEMENT
(Applebee's Restaurant - Destin, FL)
THIS CO-TENANCY AGREEMENT,
Made and entered into as of the 22nd day of September, 1997, by
and between Stanley E. La Corte, (hereinafter called "La Corte"),
and AEI Real Estate Fund XVIII Limited Partnership (hereinafter
called "Fund XVIII") (La Corte, 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 20.17% interest
in and to, and La Corte presently owns an undivided 17.7781%
interest in and to, and Adamson presently owns an undivided
31.2892% interest in and to,and Kent T. Wood and Kimberly Pasini
Wood presently own an undivided 11.0814% interest in and to, and
The John Pasini and Elvia Pasini Trust presently own an undivided
12.6222% interest in and to; and Joseph Nicoletta presently owns
an undivided 7.0591% interest in and to the land, situated in the
City of Destin, County of Walton, and State of Florida, (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 La Corte'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 La Corte 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, and Fund XVIII retains the sole
right to deal with, any property agent or tenant and to monitor,
execute and enforce the terms of leases of space within the
Premises, including but not limited to any amendments, consents
to assignment, sublet, releases or modifications to leases or
guarantees of lease or easements affecting the Premises, on
behalf of La Corte. Only Fund XVIII may obligate La Corte with
respect to any expense for the Premises.
As further set forth in paragraph 2 hereof, Fund XVIII
agrees to require any Tenant of the Premises to name La Corte 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
Co-Tenant Initial: /s/ SEL
Co-Tenancy Agreement for Applebee's Restaurant - Destin, FL
adding Co-Tenants to said policies from Tenant 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.
2. Income and expenses shall be allocated among the Co-Tenants
in proportion to their respective share(s) of ownership. Shares
of net income shall be pro-rated for any partial calendar years
included within the term of this Agreement. Fund XVIII may offset
against, pay to itself and deduct from any payment due to La
Corte under this Agreement, and may pay to itself the amount of
La Corte's share of any legitimate expenses of the Premises which
are not paid by La Corte 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 La Corte'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
Tenant under terms of any lease agreement of the Premises.
La Corte has no requirement to, but has, nonetheless, elected to
retain, and agrees to annually reimburse, Fund XVIII in the
amount of $892 for the expenses, direct and indirect, incurred by
Fund XVIII in providing La Corte with quarterly accounting and
distributions of La Corte's share of net income and for tracking,
reporting and assessing the calculation of La Corte's share of
operating expenses incurred from the Premises. This invoice
amount shall be pro-rated for partial years and La Corte
authorizes Fund XVIII to deduct such amount from La Corte's share
of revenue from the Premises. La Corte may terminate this
agreement in this paragraph respecting accounting and
distributions at any time and seek to collect its share of rental
income directly from the tenant; however, enforcement of all
other provisions of the lease remains the sole right of Fund
XVIII pursuant to Section 1 hereof.
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, La Corte
shall be entitled to receive 17.7781% of all items of income and
expense generated by the Premises. Upon receipt of said
accounting, if the payments received by each Co-Tenant pursuant
to this Paragraph 3 do not equal, in the aggregate, the amounts
which each are entitled to receive proportional to its share of
ownership with respect to said calendar year pursuant to
Paragraph 2 hereof, an appropriate adjustment shall be made so
that each Co-Tenant receives the amount to which it is entitled.
4. If Net Income from the Premises is less than $0.00 (i.e.,
the Premises operates at a loss), or if capital improvements,
repairs, and/or replacements, for which adequate reserves do not
exist, need to be made to the Premises, the Co-Tenants, upon
receipt of a written request therefor from Fund 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.
Co-Tenant Initial: /s/ SEL
Co-Tenancy Agreement for Applebee's Restaurant - Destin, FL
5. Co-Tenants may, at any time, sell, finance, or otherwise
create a lien upon their interest in the Premises but only upon
their interest and not upon any part of the interest held, or
owned, by any other Co-Tenant. All Co-Tenants reserve the right
to escrow proceeds from a sale of their interests in the Premises
to obtain tax deferral by the purchase of replacement property.
6. If any Co-Tenant shall be in default with respect to any of
its obligations hereunder, and if said default is not corrected
within thirty (30) days after receipt by said defaulting Co-
Tenant of written notice of said default, or within a reasonable
period if said default does not consist solely of a failure to
pay money, the remaining Co-Tenant(s) may resort to any available
remedy to cure said default at law, in equity, or by statute.
7. This property management agreement shall continue in full
force and effect and shall bind and inure to the benefit of the
Co-Tenant and their respective heirs, executors, administrators,
personal representatives, successors and permitted assigns until
October 31, 2021 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 La Corte:
400 East Colonial Drive
Suite 609
Orlando, FL 32803
If to Wood:
Kent T. Wood and Kimberly Pasini Wood
1550 Monte Vista Drive
Reno, NV 89509
If to Pasini:
John Pasini and Elvia Pasini, Trustees
4000 Bitter Creek Court
Reno, NV 89509
Co-Tenant Initial: /s/ SEL
Co-Tenancy Agreement for Applebee's Restaurant - Destin, FL
If to Nicoletta:
Joseph Nicoletta
5727 Camellia
North Hollywood, CA 91601
Each mailed notice or election shall be deemed to have been given
to, or served upon, the party to which addressed on the date the
same is deposited in the United States certified mail, return
receipt requested, postage prepaid, or given to a nationally
recognized courier service guaranteeing overnight delivery as
properly addressed in the manner above provided. Any party hereto
may change its address for the service of notice hereunder by
delivering written notice of said change to the other parties
hereunder, in the manner above specified, at least ten (10) days
prior to the effective date of said change.
9. This Agreement shall not create any partnership or joint
venture among or between the Co-Tenants or any of them, and the
only relationship among and between the Co-Tenants hereunder
shall be that of owners of the premises as tenants in common
subject to the terms hereof.
10. The unenforceability or invalidity of any provision or
provisions of this Agreement as to any person or circumstances
shall not render that provision, nor any other provision hereof,
unenforceable or invalid as to any other person or circumstances,
and all provisions hereof, in all other respects, shall remain
valid and enforceable.
11. In the event any litigation arises between the parties
hereto relating to this Agreement, or any of the provisions
hereof, the party prevailing in such action shall be entitled to
receive from the losing party, in addition to all other relief,
remedies and damages to which it is otherwise entitled, all
reasonable costs and expenses, including reasonable attorneys'
fees, incurred by the prevailing party in connection with said
litigation.
The remainder of this page intentionally left blank.
Co-Tenant Initial: /s/ SEL
Co-Tenancy Agreement for Applebee's Restaurant - Destin, FL
IN WITNESS WHEREOF, The parties hereto have caused this Agreement
to be executed and delivered, as of the day and year first above
written.
La Corte Stanley E. La Corte
By: /s/ Stanley E LaCorte
WITNESS:
/s/ Edward A Kerber
Edward A Kerber
(Print Name)
WITNESS:
/s/ Lavonne Harmon
Lavonne Harmon
(Print Name)
State of Florida )
) ss.
County of Orange )
The foregoing instrument was acknowledged before me, a
Notary Public in and for the County and State aforesaid,
this 16th day of July, 1997, by Stan Lacorte, Notary
Public.
/s/ Lavone Harmon
Notary Public
[notary seal]
Co-Tenant Initial: /s/ SEL
Co-Tenancy Agreement for Applebee's Restaurant - Destin, FL
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:
/s/ Dawn E Campbell
Dawn E Campbell
(Print Name)
WITNESS:
/s/ Jennifer Seck
Jennifer Seck
(Print Name)
State of Minnesota )
) ss.
County of Ramsey )
I, a Notary Public in and for the state and county of aforesaid,
hereby certify there appeared before me this 22nd day of
September, 1997, Robert P. Johnson, President of AEI Fund
Management XVIII, Inc., corporate general partner of AEI Real
Estate Fund XVIIII 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:
Co-Tenancy Agreement for Applebee's Restaurant - Destin, FL
EXHIBIT A
Legal Description
Premises: APPLEBEE'S NEIGHBORHOOD GRILL & BAR
A portion of Section 26, Township 2 South. Range 21 West,
Walton County, Florida, being more particularly described as
follows:
Commence at the intersection with the East line of the
aforesaid Section 26 and the North Right-of-way Line of
State Road 30 (U.S. 98. 100' R/W); thence go North 77
degrees 09 minutes 03 seconds West along the aforesaid Right-
of-way line, a distance of 1233.51 feet to a point of
curvature: thence go along a curve to the left, having a
radius of 5779.65 feet, an arc distance of 1060.26 feet (CH.
= 1058.78', CH. BRG. = North 82 degrees 24 minutes 26
seconds West); thence departing the aforesaid North Right-of-
way line, go North 02 degrees 59 seconds 27 minutes East, a
distance of 10.00 feet to a point on a curve, being concave
southerly and having a radius of 5789.65 feet and the Point
of Beginning: thence go northwesterly along the aforesaid
curve, an arc distance of 180.00 feet (CH. = 179.99', CH.
BRG. = North 88 degrees 33 minutes 11 seconds West): thence
go North 02 degrees 59 minutes 27 seconds East, a distance
of 215.00 feet: thence go South 88 degrees 38 minutes 25
seconds East, a distance of 178.79 feet to a Point on a
curve, being concave southwesterly and having a radius of
44.90 feet: thence go Southeasterly along the aforesaid
curve, an arc distance of 10.44 feet (CHI. = 10.42'. CHI.
BRAG. = South 03 degrees 39 minutes 46 seconds East) to the
Point of Tangency: thence go South 02 degrees 59 minutes 27
seconds East, a distance of 204.89 feet to the Point of
Beginning.
EXCEPTING THEREFROM THAT PORTION
lying Northerly of and within 66 feet of the centerline of
survey of State Road 30 (US 98) Section 60020, Westerly of
Station 248+00 and lying Northerly of and within 67 feet of
said centerline of survey, between Station 248+00 and
Station 256+51 and lying Northerly of said centerline of
survey and within a transition from 67 feet at Station
256+51 to 87 feet at Station 256+76; and lying Northerly of
and within 110 feet of said centerline of survey, between
Station 256+76 and Station 257+36; and lying Northerly of
said centerline of survey and within a transition from 87
feet at Station 257+36 to 67 feet at Station 257+61; and
lying Northerly of and within 67 feet of said centerline of
survey Easterly of Station 257+611; said centerline to be
described and said Stations to be located as follows:
Commence on a capped rod (RLS # 1835) at the Southeast
corner of Sandestin Estates Subdivision, as per plat
recorded in Plat Book 4, Page 25 of the Public Records of
Walton County, Florida; thence South 44 16' 49" East 101.64
feet; thence North 83 48' 54" East 3476.74 feet (crossing
the East line of Section 27, Township 2 South, Range 21 West
and the West line of Section 26, Township 2 South 2 South,
Range 21 West) to the POINT OF BEGINNING of centerline of
survey to be described herein, said point being the
beginning of a curve, concave Southerly, having a radius of
5729.58 feet; thence run Northeasterly, Easterly and
Southeasterly 1302.52 feet along said curve, thru a central
angle of 13 o1' 31" to Station 248+00; thence continue
Southeasterly 695.62 feet along said curve, thru a central
angle of 6 57' 22" to the end of curve; thence South 76 12'
14" East 155.38 feet to Station 256+51; thence continue
South 76 12' 14" East 25.0 feet to Station 256+76; thence
continue South 76 12' 14" East 60.00 feet to Station 257+36;
thence continue South 76 12'14" East 25.0 feet to Station
257+61; thence continue South 76 12' 14" East 977.87 feet to
the East line of said Section 26 (West line of Section 25,
Township 2 South Range 21 West) at a point 4561.50 feet
South 1 50' 37" West of a four inch by four inch concrete
monument on the Northeast corner of said Section 26
(Northwest corner of said Section 25); thence continue South
76 12' 14" East 1359.55 feet to a point of intersection with
the Southerly extension of the Easterly line of Parcel A of
Tract 308 of said Section 25; and end of centerline of
survey herein described; said point being 518.40 feet South
2 00' 23" West of a capped rod (RLS # 2535) on the Northeast
corner of said partial A; containing 1080 square feet, more
or less.
PROPERTY CO-TENANCY
OWNERSHIP AGREEMENT
(Taco Cabana - San Antonio, TX)
THIS CO-TENANCY AGREEMENT,
Made and entered into as of the 25th day of September, 1997, by
and between Nick DeVito, Inc., a California Corporation,
(hereinafter called "DeVito"), and AEI Real Estate Fund XVIII
Limited Partnership (hereinafter called "Fund XVIII") (DeVito,
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 35.0623% interest
in and to, and DeVito presently owns an undivided 15.6724%
interest in and to, and Anton Kuster presently owns an undivided
11.5896% interest in and to, and The Hesson Family Trust
presently owns an undivided 13.2895% interest in and to, and Arel
D. and Louise B. Middleton presently owns and undivided 10.6316%
interest (also referred to herein as Co-Tenant) 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 DeVito'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 DeVito 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 DeVito 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 DeVito 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-Tenant Initial: /s/ V.D.F
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
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.
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 DeVito under this
Agreement, and may pay to itself the amount of DeVito's share of
any legitimate expenses of the Premises which are not paid by
DeVito 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 DeVito'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
Tenant under terms of any lease agreement of the Premises.
DeVito has no requirement to, but has, nonetheless elected to
retain, and agrees to annually reimburse, Fund XVIII in the
amount of $900 for the expenses, direct and indirect, incurred by
Fund XVIII in providing monthly accounting and distributions of
DeVito's share of net income and for tracking, reporting and
assessing the calculation of DeVito's share of operating expenses
incurred from the Premises. This invoice amount shall be pro-
rated for partial years and DeVito authorizes Fund XVIII to
deduct such amount from DeVito's share of revenue from the
Premises. DeVito may terminate this agreement in this paragraph
respecting accounting and distributions at any time and attempt
to collect its share of rental income directly from the tenant;
however, enforcement of all other provisions of the lease remains
the sole right of Fund XVIII pursuant to Section 1 hereof. Fund
XVIII may terminate its obligation under this paragraph upon 30
days notice to DeVito prior to the end of each anniversary
hereof, unless agreed in writing to the contrary.
3. Full, accurate and complete books of account shall be kept
in accordance with generally accepted accounting principles at
Fund 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, DeVito shall
be entitled to receive 15.6724% of all items of income and
expense generated by the Premises. Upon receipt of said
accounting, if the payments received by each Co-Tenant pursuant
to this Paragraph 3 do not equal, in the aggregate, the amounts
which each are entitled to receive proportional to its share of
ownership with respect to said calendar year pursuant to
Paragraph 2 hereof, an appropriate adjustment shall be made so
that each Co-Tenant receives the amount to which it is entitled.
4. If Net Income from the Premises is less than $0.00 (i.e.,
the Premises operates at a loss), or if capital improvements,
repairs, and/or replacements, for which adequate reserves do not
exist, need to be made to the Premises, the Co-Tenants, upon
receipt of a written request therefor from Fund XVIII, shall,
within fifteen (15) business days after receipt of notice, make
payment to
Co-Tenant Initial: /s/ V.D.F
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
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. Subject to the rights of any Tenant under a lease of the
Premises, Co-Tenants may, at any time, sell, finance, or
otherwise create a lien upon their interest in the Premises but
only upon their interest and not upon any part of the interest
held, or owned, by any other Co-Tenant. All Co-Tenants reserve
the right to escrow proceeds from a sale of their interests in
the Premises to obtain tax deferral by the purchase of
replacement property.
6. If any Co-Tenant, shall be in default with respect to any of
its obligations hereunder, and if said default is not corrected
within thirty (30) days after receipt by said defaulting Co-
Tenant of written notice of said default, or within a reasonable
period if said default does not consist solely of a failure to
pay money, the remaining Co-Tenant(s) may resort to any available
remedy to cure said default at law, in equity, or by statute.
7. This property management agreement shall continue in full
force and effect and shall bind and inure to the benefit of the
Co-Tenant and their respective heirs, executors, administrators,
personal representatives, successors and permitted assigns until
July 19, 2016 or upon the sale of the entire Premises in
accordance with the terms hereof and proper disbursement of the
proceeds thereof, whichever shall first occur. Unless
specifically identified as a personal contract right or
obligation herein, this agreement shall run with any interest in
the Premises and with the title thereto. Once any person, party
or entity has ceased to have an interest in fee in any portion of
the Premises, it shall not be bound by, subject to or benefit
from the terms hereof; but its heirs, executors, administrators,
personal representatives, successors or assigns, as the case may
be, shall be substituted for it hereunder.
8. Any notice or election required or permitted to be given or
served by any party hereto to, or upon any other, shall be 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
Co-Tenant Initial: /s/ V.D.F
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
If to Hesson:
Ivan Hesson, Trustee
3864 Via Lasbrisas
Santa Barbera, CA 93110
If to Kuster:
Tony Kuster
4214 Danbury
Amarillo, TX 79109
If to DeVito
Vito DeVito Francesco, Secretary/Treasurer
P.O, Box 591
Ontario, CA 91762
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.
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/ V.D.F
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.
DeVito Nick DeVito, Inc., a California Corporation
By: /s/ Vito DeVito Francesco
Vito DeVito Francesco, Secretary/Treasurer
Witness By:/s/ Warren Stewart
Witness By:/s/ Sharon Rose
STATE OF )
) ss
COUNTY OF )
The foregoing instrument was acknowledged before me, a
Notary Public in and for the County and State aforesaid,
this day of ,1997, by ,
Notary Public.
Co-Tenant Initial: /s/ V.D.F
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
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/ Dawn E Campbell
Witness By:/s/ Jennifer Seck
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 25th day of
September, 1997, 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
Co-Tenant Initial: /s/ V.D.F
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 or Bexar County, Texas.
PURCHASE AGREEMENT
Taco Cabana, San Antonio, TX
This AGREEMENT, entered into effective as of the 30th of
September, 1997 .
l. Parties. Seller is AEI Real Estate Fund XVIII Limited
Partnership ("Seller"), which presently holds an undivided
50.7347% interest in the fee title to that certain real property
legally described in the attached Exhibit "A". (the "Entire
Property") Buyer is Reginald O. Hill, trustee of the Reginald
O. Hill Trust dated 5/25/95 and Donna Jean Hill, trustee of the
Donna Jean Hill Trust dated 5/25/95 ("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 12.8462% percentage interest
(hereinafter, simply the "Property") as Tenant in Common in the
Entire Property. To the best of Seller's knowledge, the purchase
of the Property is the purchase of an interest in real property
under Texas law.
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:
(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, or otherwise dispersed
pursuant to the terms of this Agreement.
(b) Buyer will deposit the balance of the purchase price,
$245,000 (the "Second Payment") into escrow in sufficient
time to allow escrow to close on the Closing Date.
(c) Seller hereby acknowledges receipt of the sum of $50.00
cash (the "Option Consideration") from Buyer, as
consideration for execution of this Agreement by Seller. If
the purchase and sale of the Property is consummated
pursuant to this Agreement, the Option Consideration shall
be applied toward the purchase price paid by Buyer. If this
Agreement is terminated pursuant to a default by Seller
hereunder, the Option Consideration shall be immediately
returned by Seller to Buyer. If this Agreement is
terminated for any reason other than a default by Seller
hereunder, Seller shall be entitled to retain the Option
Consideration.
5. Closing Date. Escrow shall close on or before October 3,
1997.
6. Due Diligence. Buyer will have until the expiration of the
fifth business day (The "Review Period") after delivery of each
of following items, to be supplied by Seller, to conduct all of
its inspections and due diligence and satisfy itself regarding
each item, the Property, and this transaction. Buyer agrees to
indemnify and hold Seller harmless for any loss or damage to the
Leased Premises or persons caused by Buyer or its agents arising
out of such physical inspections of the Entire Property.
(a) The original and one copy of a title insurance
commitment for an Owner's Title insurance policy (see
paragraph 8 below).
(b) Copies of a Certificate of Occupancy or other such
document certifying completion and granting permission to
permanently occupy the improvements on the Entire Property
as are in Seller's possession.
Buyer Initial: /s/ DH /s/ RH
Purchase Agreement for Taco Cabana - San Antonio, TX
(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 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. Such notice shall be deemed effective only
upon receipt by Seller. If this Agreement is not canceled as set
forth above, the First Payment shall be non-refundable unless
Seller shall default hereunder.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under 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.
Unless this Agreement is canceled by Buyer pursuant to the
terms hereof, if Buyer fails to make the Second Payment, Seller
shall be entitled to retain the First Payment and Buyer
irrevocably will be deemed to be in default under this Agreement.
Seller may, at its option, retain the First Payment and declare
this Agreement null and void, in which event Buyer will be deemed
to have canceled this Agreement and relinquish all rights in and
to the Property or Seller may exercise its rights under Section
14 hereof. If this Agreement is not canceled and the Second
Payment is made when required, all of Buyer's conditions and
contingencies will be deemed satisfied.
7. Escrow. Escrow shall be opened by Seller and funds deposited
in escrow upon acceptance of this Agreement by both parties. The
escrow holder will be a nationally-recognized escrow company
selected by Seller. A copy of this Agreement will be delivered to
the escrow holder and will serve as escrow instructions together
with the escrow holder's standard instructions and any additional
instructions required by the escrow holder to clarify its rights
and duties (and the parties agree to sign these additional
instructions). If there is any conflict between these other
instructions and this Agreement, this Agreement will control.
8. Title. Closing will be conditioned on the commitment of a
title company selected by Seller to issue an Owner's policy of
title insurance, dated as of the close of escrow, in an amount
equal to the purchase price, insuring that Buyer will own
insurable title to the Property subject only to: the title
company's standard exceptions; current real property taxes and
assessments; survey exceptions; the rights of parties in
possession pursuant to the lease defined in paragraph 11 below;
and other items of record disclosed to Buyer during the Review
Period.
Buyer shall be allowed five (5) days after receipt of said
commitment for examination and the making of any objections to
marketability thereto, said objections to be made in writing or
deemed waived. If any objections are so made, the Seller shall
be allowed eighty (80) days to make such title marketable or in
the alternative to obtain a commitment for insurable title
insuring over Buyer's objections. If Seller shall decide to make
no efforts to make title marketable, or is unable to make title
marketable or obtain insurable title, (after execution by Buyer
of such documents reasonably requested by Seller to evidence the
termination hereof) Buyer's First Payment
Buyer Initial: /s/ DH /s/ RH
Purchase Agreement for Taco Cabana - San Antonio, TX
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 except those brokerage commissions incurred by Buyer.
The buyer will pay the cost of issuing a Standard Owners Title
Insurance Policy in the full amount of the purchase price, if
Buyer desires to purchase the same. Buyer will pay all recording
fees, one-half of the escrow fees, and the cost of an update to
the Survey in Sellers possession (if an update is required by
Buyer.) Each party will pay its own attorney's fees and costs to
document and close this transaction.
10. Real Estate Taxes, Special Assessments and Prorations.
(a) Because the Entire Property (of which the Property is a
part) is subject to a triple net lease (as further set forth
in paragraph 11(a)(i), the parties acknowledge that there
shall be no need for a real estate tax proration. However,
Seller represents that to the best of its knowledge, all
real estate taxes and installments of special assessments
due and payable in all years prior to the year of Closing
have been paid in full. Unpaid levied and pending special
assessments existing on the date of Closing shall be the
responsibility of Buyer and Seller in proportion to their
respective Tenant in Common interests, pro-rated, however,
to the date of closing; for the period prior to closing,
such taxes and asessments shall be the responsibility of
Seller, if Tenant shall not pay the same. Seller and Buyer
shall likewise pay in proportion to their ownership
interests all taxes due and payable in the year after
Closing and any unpaid installments of special assessments
payable therewith and thereafter, if such unpaid levied and
pending special assessments and real estate taxes are not
paid by any tenant of the Entire Property.
(b) All income and all operating expenses from the Entire
Property shall be prorated between the parties and adjusted
by them as of the date of Closing. Seller shall be entitled
to all income earned and shall be responsible for all
expenses incurred prior to the date of Closing, and Buyer
shall be entitled to its proportionate share of all income
earned and shall be responsible for its proportionate share
of all operating expenses of the Property incurred on and
after the date of closing, if the same are not paid by any
tenant of the Entire Property.
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. ("Lessee"), 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". The above referenced lease agreement has an
option to purchase in favor of the Lessee as set forth in
article 34 of said lease agreement.
Buyer Initial: /s/ DH /s/ RH
Purchase Agreement for Taco Cabana - San Antonio, 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 prior to the Closing Date 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 the use and operation of 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 gross negligence or
intentional misconduct.
(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
Buyer Initial: /s/ DH /s/ RH
Purchase Agreement for Taco Cabana - San Antonio, TX
information provided by Seller or to be provided except as
set forth herein. Buyer further acknowledges that the
information provided and to be provided by Seller with
respect to the Property and to the Lessee and Guarantors of
Lease was obtained from a variety of sources and Seller
neither (a) has made independent investigation or
verification of such information, or (b) makes any
representations as to the accuracy or completeness of such
information. The sale of the Property as provided for
herein is made on an "AS IS" basis, and Buyer expressly
acknowledges that, in consideration of the agreements of
Seller herein, except as otherwise specified herein, Seller
makes no warranty or representation, express or implied, or
arising by operation of law, including, but not limited to,
any warranty or condition, habitability, tenantability,
suitability for commercial purposes, merchantability, or
fitness for a particular purpose, in respect of the
Property.
The provisions (d) - (f) above shall survive closing.
13. Closing.
(a) Before the Closing Date, Seller will deposit into
escrow an executed special warranty deed conveying insurable
title of the Property to Buyer, subject to the encumbrances
contained in paragraph 8 above.
(b) On or before the Closing Date, Buyer will deposit into
escrow: the balance of the purchase price when required
under Section 4; any additional funds required of Buyer,
(pursuant to this agreement or any other agreement executed
by Buyer) to close escrow. Both parties will sign the Co-
Tenancy Agreement, 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
owners title policy purchase by Buyer; immediately deliver
to Seller the portion of the purchase price deposited into
escrow by cashier's check or wire transfer (less debits and
prorations, if any); deliver to Seller and Buyer a signed
counterpart of the escrow holder's certified closing
statement and take all other actions necessary to close
escrow.
14. Defaults. If Buyer defaults, Buyer will forfeit all rights
and claims and Seller will be relieved of all obligations and
will be entitled to retain all monies heretofore paid by the
Buyer. In addition, Seller shall retain all remedies available
to Seller at law or in equity.
If Seller shall default, Buyer irrevocably waives any rights
to file a lis pendens, a specific performance action or any other
claim, action or proceeding of any type in connection with the
Property or this or any other transaction involving the Property,
and will not do anything to affect title to the Property or
hinder, delay or prevent any other sale, lease or other
transaction involving the Property (any and all of which will be
null and void), unless: it has paid the First Payment, deposited
the balance of the second payment for the purchase price into
escrow, performed all of its other obligations and satisfied all
conditions under this Agreement, and unconditionally notified
Seller that it stands ready to tender full performance, purchase
the Property and close escrow as per this Agreement, regardless
of any alleged default or misconduct by Seller. Provided,
however, that in no event shall Seller be liable for any actual,
punitive, consequential or speculative damages arising out of any
default by Seller hereunder.
15. Buyer's Representations and Warranties.
a. Buyer represents and warrants to Seller as follows:
Buyer Initial: /s/ DH /s/ RH
Purchase Agreement for Taco Cabana - San Antonio, TX
(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 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.
Buyer Initial: /s/ DH /s/ RH
Purchase Agreement for Taco Cabana - San Antonio, TX
While Seller acknowledges that Buyer is purchasing the
Property as "replacement property" to accomplish a tax free
exchange, Buyer acknowledges that Seller has made no
representations, warranties, or agreements to Buyer or Buyer's
agents that the transaction contemplated by the Agreement will
qualify for such tax treatment, nor has there been any reliance
thereon by Buyer respecting the legal or tax implications of the
transactions contemplated hereby. Buyer further represents that
it has sought and obtained such third party advice and counsel as
it deems necessary in regards to the tax implications of this
transaction.
Buyer wishes to novate/assign the ownership rights and
interest of this Purchase Agreement to Chicago Deferred Exchange
who will act as Facilitator to perfect the 1031 exchange by
preparing an agreement of exchange of Real Property whereby
Chicago Deferred Exchange will be an independent third party
purchasing the ownership interest in subject property from Seller
and selling the ownership interest in subject property to Buyer
under the same terms and conditions as documented in this
Purchase Agreement. Buyer asks the Seller 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 Chicago Deferred
Exchange, Seller will deed the Property to Buyer.
18. Cancellation
If any party elects to cancel this Contract because of any
breach by another party, 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
canceled 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 canceled.
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 3, 1997
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.
Buyer Initial: /s/ DH /s/ RH
Purchase Agreement for Taco Cabana - San Antonio, TX
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:
Reginald Hill
Donna Hill
1912 Lakeside Lane
Indianapolis, IN 46229
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: THE REGINALD O. HILL TRUST DATED 5/25/95
By: /s/ Reginald O Hill, Trustee
Reginald O. Hill, Trustee
THE DONNA JEAN HILL TRUST DATED 5/25/95
By: /s/ Donna Jean Hill, Trustee
Donna Jean Hill, Trustee
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/ DH /s/ RH
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 or Bexar County, Texas.
PURCHASE AGREEMENT
Taco Cabana, San Antonio, TX
This AGREEMENT, entered into effective as of the 5 of Oct, 1997 .
l. Parties. Seller is AEI Real Estate Fund XVIII Limited
Partnership ("Seller"), which presently holds an undivided
50.7347% interest in the fee title to that certain real property
legally described in the attached Exhibit "A". (the "Entire
Property") Buyer is Anthony Drago, Trustee, U/A DTD 8/19/80,
FBO Anthony and Sydelle Drago Family Trust ("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 12.8462% percentage interest
(hereinafter, simply the "Property") as Tenant in Common in the
Entire Property. To the best of Seller's knowledge, the purchase
of the Property is the purchase of an interest in real property
under Texas law.
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:
(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, or otherwise dispersed
pursuant to the terms of this Agreement.
(b) Buyer will deposit the balance of the purchase price,
$245,000 (the "Second Payment") into escrow in sufficient
time to allow escrow to close on the Closing Date.
(c) Seller hereby acknowledges receipt of the sum of $50.00
cash (the "Option Consideration") from Buyer, as
consideration for execution of this Agreement by Seller. If
the purchase and sale of the Property is consummated
pursuant to this Agreement, the Option Consideration shall
be applied toward the purchase price paid by Buyer. If this
Agreement is terminated pursuant to a default by Seller
hereunder, the Option Consideration shall be immediately
returned by Seller to Buyer. If this Agreement is
terminated for any reason other than a default by Seller
hereunder, Seller shall be entitled to retain the Option
Consideration.
5. Closing Date. Escrow shall close on or before October 30,
1997.
6. Due Diligence. Buyer will have until the expiration of the
fifth business day (The "Review Period") after delivery of each
of following items, to be supplied by Seller, to conduct all of
its inspections and due diligence and satisfy itself regarding
each item, the Property, and this transaction. Buyer agrees to
indemnify and hold Seller harmless for any loss or damage to the
Leased Premises or persons caused by Buyer or its agents arising
out of such physical inspections of the Entire Property.
(a) The original and one copy of a title insurance
commitment for an Owner's Title insurance policy (see
paragraph 8 below).
(b) Copies of a Certificate of Occupancy or other such
document certifying completion and granting permission to
permanently occupy the improvements on the Entire Property
as are in Seller's possession.
Buyer Initieal: /s/ A. D
Purchase Agreement for Taco Cabana - San Antonio, TX
(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 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. Such notice shall be deemed effective only
upon receipt by Seller. If this Agreement is not canceled as set
forth above, the First Payment shall be non-refundable unless
Seller shall default hereunder.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under 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.
Unless this Agreement is canceled by Buyer pursuant to the
terms hereof, if Buyer fails to make the Second Payment, Seller
shall be entitled to retain the First Payment and Buyer
irrevocably will be deemed to be in default under this Agreement.
Seller may, at its option, retain the First Payment and declare
this Agreement null and void, in which event Buyer will be deemed
to have canceled this Agreement and relinquish all rights in and
to the Property or Seller may exercise its rights under Section
14 hereof. If this Agreement is not canceled and the Second
Payment is made when required, all of Buyer's conditions and
contingencies will be deemed satisfied.
7. Escrow. Escrow shall be opened by Seller and funds deposited
in escrow upon acceptance of this Agreement by both parties. The
escrow holder will be a nationally-recognized escrow company
selected by Seller. A copy of this Agreement will be delivered to
the escrow holder and will serve as escrow instructions together
with the escrow holder's standard instructions and any additional
instructions required by the escrow holder to clarify its rights
and duties (and the parties agree to sign these additional
instructions). If there is any conflict between these other
instructions and this Agreement, this Agreement will control.
8. Title. Closing will be conditioned on the commitment of a
title company selected by Seller to issue an Owner's policy of
title insurance, dated as of the close of escrow, in an amount
equal to the purchase price, insuring that Buyer will own
insurable title to the Property subject only to: the title
company's standard exceptions; current real property taxes and
assessments; survey exceptions; the rights of parties in
possession pursuant to the lease defined in paragraph 11 below;
and other items of record disclosed to Buyer during the Review
Period.
Buyer shall be allowed five (5) days after receipt of said
commitment for examination and the making of any objections to
marketability thereto, said objections to be made in writing or
deemed waived. If any objections are so made, the Seller shall
be allowed eighty (80) days to make such title marketable or in
the alternative to obtain a commitment for insurable title
insuring over Buyer's objections. If Seller shall decide to make
no efforts to make title marketable, or is unable to make title
marketable or obtain insurable title, (after execution by Buyer
of such documents reasonably
Buyer Initieal: /s/ A. D
Purchase Agreement for Taco Cabana - San Antonio, TX
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 except those brokerage commissions incurred by Buyer.
The buyer will pay the cost of issuing a Standard Owners Title
Insurance Policy in the full amount of the purchase price, if
Buyer desires to purchase the same. Buyer will pay all recording
fees, one-half of the escrow fees, and the cost of an update to
the Survey in Sellers possession (if an update is required by
Buyer.) Each party will pay its own attorney's fees and costs to
document and close this transaction.
10. Real Estate Taxes, Special Assessments and Prorations.
(a) Because the Entire Property (of which the Property is a
part) is subject to a triple net lease (as further set forth
in paragraph 11(a)(i), the parties acknowledge that there
shall be no need for a real estate tax proration. However,
Seller represents that to the best of its knowledge, all
real estate taxes and installments of special assessments
due and payable in all years prior to the year of Closing
have been paid in full. Unpaid levied and pending special
assessments existing on the date of Closing shall be the
responsibility of Buyer and Seller in proportion to their
respective Tenant in Common interests, pro-rated, however,
to the date of closing; for the period prior to closing,
such taxes and asessments shall be the responsibility of
Seller, if Tenant shall not pay the same. Seller and Buyer
shall likewise pay in proportion to their ownership
interests all taxes due and payable in the year after
Closing and any unpaid installments of special assessments
payable therewith and thereafter, if such unpaid levied and
pending special assessments and real estate taxes are not
paid by any tenant of the Entire Property.
(b) All income and all operating expenses from the Entire
Property shall be prorated between the parties and adjusted
by them as of the date of Closing. Seller shall be entitled
to all income earned and shall be responsible for all
expenses incurred prior to the date of Closing, and Buyer
shall be entitled to its proportionate share of all income
earned and shall be responsible for its proportionate share
of all operating expenses of the Property incurred on and
after the date of closing, if the same are not paid by any
tenant of the Entire Property.
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. ("Lessee"), 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". The
Buyer Initieal: /s/ A. D
Purchase Agreement for Taco Cabana - San Antonio, TX
above referenced lease agreement has an option to purchase
in favor of the Lessee as set forth in article 34 of said
lease agreement.
(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 prior to the Closing Date 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 the use and operation of 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 gross negligence or
intentional misconduct.
(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 Initieal: /s/ A. D
Purchase Agreement for Taco Cabana - San Antonio, TX
(f) Buyer acknowledges that, having been given the
opportunity to inspect the Property and such financial
information on the Lessee and Guarantors of the Lease as
Buyer or its advisors shall request, Buyer is relying solely
on its own investigation of the Property and not on any
information provided by Seller or to be provided except as
set forth herein. Buyer further acknowledges that the
information provided and to be provided by Seller with
respect to the Property and to the Lessee and Guarantors of
Lease was obtained from a variety of sources and Seller
neither (a) has made independent investigation or
verification of such information, or (b) makes any
representations as to the accuracy or completeness of such
information. The sale of the Property as provided for
herein is made on an "AS IS" basis, and Buyer expressly
acknowledges that, in consideration of the agreements of
Seller herein, except as otherwise specified herein, Seller
makes no warranty or representation, express or implied, or
arising by operation of law, including, but not limited to,
any warranty or condition, habitability, tenantability,
suitability for commercial purposes, merchantability, or
fitness for a particular purpose, in respect of the
Property.
The provisions (d) - (f) above shall survive closing.
13. Closing.
(a) Before the Closing Date, Seller will deposit into
escrow an executed special warranty deed conveying insurable
title of the Property to Buyer, subject to the encumbrances
contained in paragraph 8 above.
(b) On or before the Closing Date, Buyer will deposit into
escrow: the balance of the purchase price when required
under Section 4; any additional funds required of Buyer,
(pursuant to this agreement or any other agreement executed
by Buyer) to close escrow. Both parties will sign the Co-
Tenancy Agreement, 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
owners title policy purchase by Buyer; immediately deliver
to Seller the portion of the purchase price deposited into
escrow by cashier's check or wire transfer (less debits and
prorations, if any); deliver to Seller and Buyer a signed
counterpart of the escrow holder's certified closing
statement and take all other actions necessary to close
escrow.
14. Defaults. If Buyer defaults, Buyer will forfeit all rights
and claims and Seller will be relieved of all obligations and
will be entitled to retain all monies heretofore paid by the
Buyer. In addition, Seller shall retain all remedies available
to Seller at law or in equity.
If Seller shall default, Buyer irrevocably waives any rights
to file a lis pendens, a specific performance action or any other
claim, action or proceeding of any type in connection with the
Property or this or any other transaction involving the Property,
and will not do anything to affect title to the Property or
hinder, delay or prevent any other sale, lease or other
transaction involving the Property (any and all of which will be
null and void), unless: it has paid the First Payment, deposited
the balance of the second payment for the purchase price into
escrow, performed all of its other obligations and satisfied all
conditions under this Agreement, and unconditionally notified
Seller that it stands ready to tender full performance, purchase
the Property and close escrow as per this Agreement, regardless
of any alleged default or misconduct by Seller. Provided,
however, that in no event shall Seller be liable for any actual,
punitive, consequential or speculative damages arising out of any
default by Seller hereunder.
Buyer Initieal: /s/ A. D
Purchase Agreement for Taco Cabana - San Antonio, TX
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 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.
Buyer Initieal: /s/ A. D
Purchase Agreement for Taco Cabana - San Antonio, TX
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 Western American Exchange
who will act as Facilitator to perfect the 1031 exchange by
preparing an agreement of exchange of Real Property whereby
Western American Exchange will be an independent third party
purchasing the ownership interest in subject property from Seller
and selling the ownership interest in subject property to Buyer
under the same terms and conditions as documented in this
Purchase Agreement. Buyer asks the Seller 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 Western American
Exchange, Seller will deed the Property to Buyer.
18. Cancellation
If any party elects to cancel this Contract because of any
breach by another party, 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
canceled 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 canceled.
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 30, 1997
through no fault of Seller, Seller may either, at its
election, extend the Closing Date or exercise any remedy
available to it by law, including terminating this
Agreement.
(c) Funds to be deposited or paid by Buyer must be good and
clear funds in the form of cash, cashier's checks or wire
transfers.
Buyer Initieal: /s/ A. D
Purchase Agreement for Taco Cabana - San Antonio, TX
(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:
Anthony Drago
17719 Royce Dr W
Encino, CA 91316
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: ANTHONY AND SYDELLE DRAGO FAMILY TRUST
By: /s/ Anthony Drago TTEE
Anthony Drago, Trustee
WITNESS:
/s/ Gary Benson
Gary Benson
(Print Name)
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 Initieal: /s/ A. D
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 or Bexar County, Texas.
PROPERTY CO-TENANCY
OWNERSHIP AGREEMENT
(Taco Cabana - San Antonio, TX)
THIS CO-TENANCY AGREEMENT,
Made and entered into as of the 9th day of October, 1997, by and
between Reginald O. Hill, trustee of the Reginald O. Hill Trust
dated 5/25/95 and Donna Jean Hill, trustee of the Donna Jean Hill
Trust dated 5/25/95 (hereinafter called "Hill"), and AEI Real
Estate Fund XVIII Limited Partnership (hereinafter called "Fund
XVIII") (Hill, 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 22.2161% interest
in and to, and Hill presently owns an undivided 12.8462% interest
in and to, and Nick DeVito, Inc. presently owns an undivided
15.6724% interest in and to, and Anton Kuster presently owns an
undivided 11.5896% interest in and to, and The Hesson Family
Trust presently owns an undivided 13.2895% interest in and to,
and Arel D. and Louise B. Middleton presently owns and undivided
10.6316% interest (also referred to herein as Co-Tenant) 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 Hill'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 Hill 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 Hill with respect to any
expense for the Premises.
Co-Tenant Initial: /s/ RH /s/ DH
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
As further set forth in paragraph 2 hereof, Fund XVIII agrees to
require any lessee of the Premises to name Hill 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.
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 Hill under this
Agreement, and may pay to itself the amount of Hill's share of
any legitimate expenses of the Premises which are not paid by
Hill 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 Hill'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
Tenant under terms of any lease agreement of the Premises.
Hill has no requirement to, but has, nonetheless elected to
retain, and agrees to annually reimburse, Fund XVIII in the
amount of $740 for the expenses, direct and indirect, incurred by
Fund XVIII in providing quarterly accounting and distributions of
Hill's share of net income and for tracking, reporting and
assessing the calculation of Hill's share of operating expenses
incurred from the Premises. This invoice amount shall be pro-
rated for partial years and Hill authorizes Fund XVIII to deduct
such amount from Hill's share of revenue from the Premises. Hill
may terminate this agreement in this paragraph respecting
accounting and distributions at any time and attempt to collect
its share of rental income directly from the tenant; however,
enforcement of all other provisions of the lease remains the sole
right of Fund XVIII pursuant to Section 1 hereof. Fund XVIII may
terminate its obligation under this paragraph upon 30 days notice
to Hill prior to the end of each anniversary hereof, unless
agreed in writing to the contrary.
3. Full, accurate and complete books of account shall be kept
in accordance with generally accepted accounting principles at
Fund 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, Hill shall
be entitled to receive 12.8462% of all items of income and
expense generated by the Premises. Upon receipt of said
accounting, if the payments received by each Co-Tenant pursuant
to this Paragraph 3 do not equal, in the aggregate, the amounts
which each are entitled to receive proportional to its share of
ownership with respect to said calendar year pursuant to
Paragraph 2 hereof, an appropriate adjustment shall be made so
that each Co-Tenant receives the amount to which it is entitled.
4. If Net Income from the Premises is less than $0.00 (i.e.,
the Premises operates at a loss), or if capital improvements,
repairs, and/or replacements, for which adequate reserves do not
exist, need to be made to the Premises, the Co-Tenants, upon
receipt of a written request therefor from Fund 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
Co-Tenant Initial: /s/ RH /s/ DH
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
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. Subject to the rights of any Tenant under a lease of the
Premises, Co-Tenants may, at any time, sell, finance, or
otherwise create a lien upon their interest in the Premises but
only upon their interest and not upon any part of the interest
held, or owned, by any other Co-Tenant. All Co-Tenants reserve
the right to escrow proceeds from a sale of their interests in
the Premises to obtain tax deferral by the purchase of
replacement property.
6. If any Co-Tenant, shall be in default with respect to any of
its obligations hereunder, and if said default is not corrected
within thirty (30) days after receipt by said defaulting Co-
Tenant of written notice of said default, or within a reasonable
period if said default does not consist solely of a failure to
pay money, the remaining Co-Tenant(s) may resort to any available
remedy to cure said default at law, in equity, or by statute.
7. This property management agreement shall continue in full
force and effect and shall bind and inure to the benefit of the
Co-Tenant and their respective heirs, executors, administrators,
personal representatives, successors and permitted assigns until
July 19, 2016 or upon the sale of the entire Premises in
accordance with the terms hereof and proper disbursement of the
proceeds thereof, whichever shall first occur. Unless
specifically identified as a personal contract right or
obligation herein, this agreement shall run with any interest in
the Premises and with the title thereto. Once any person, party
or entity has ceased to have an interest in fee in any portion of
the Premises, it shall not be bound by, subject to or benefit
from the terms hereof; but its heirs, executors, administrators,
personal representatives, successors or assigns, as the case may
be, shall be substituted for it hereunder. Hill agrees to notify
Fund XVIII upon the appointment of any successor trustee, or any
amendment of the Reginald O. Hill Trust or the Donna Jean Hill
Trust affecting the powers of the Trustees to manage or dispose
of the Hill Trust's interest in the Premises.
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
Co-Tenant Initial: /s/ RH /s/ DH
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
If to Hesson:
Ivan Hesson, Trustee
3864 Via Lasbrisas
Santa Barbera, CA 93110
If to Kuster:
Tony Kuster
4214 Danbury
Amarillo, TX 79109
If to DeVito:
Vito DeVito Francesco, Secretary/Treasurer
P.O, Box 591
Ontario, CA 91762
If to Hill:
Reginald Hill
Donna Hill
1912 Lakeside Lane
Indianapolis, IN 46229
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.
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/ RH /s/ DH
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.
Hill Reginald O. Hill Trust dated 5/25/95 and the Donna Jean
Hill Trust dated 5/25/95
By: /s/ Reginald O Hill, Trustee
Reginald O. Hill, Trustee
Witness By: /s/ Thomas E Crawford
Witness By:/s/ Judith L. Crawford
STATE OF Indiana)
) ss
COUNTY OF Koseiusku)
The foregoing instrument was acknowledged before me, a
Notary Public in and for the County and State aforesaid,
this 18th day of September,1997, by Janet A Miller, Notary
Public.
/s/ Janet A Miller
My commission expires 3/2/98
By:/s/ Donna Jean Hill
Donna Jean Hill, Trustee
Witness By: /s/ Thomas E Crawford
Witness By:/s/ Judith L Crawford
STATE OF Indiana)
) ss
COUNTY OF Koseiusku)
The foregoing instrument was acknowledged before me, a
Notary Public in and for the County and State aforesaid,
this 18th day of September, 1997, by Janet A Miller,
Notary Public.
/s/ Janet A Miller
My commission expires 3/2/98
Co-Tenant Initial: /s/ RH /s/ DH
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
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/ Dawn E Campbell
Witness By: /s/ Jennifer Seck
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 9th day of October,
1997, 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/ Brian K Schulz
Notary Public
[notary seal]
Co-Tenant Initial: /s/ RH /s/ DH
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 or Bexar County, Texas.
PROPERTY CO-TENANCY
OWNERSHIP AGREEMENT
(Taco Cabana - San Antonio, TX)
THIS CO-TENANCY AGREEMENT,
Made and entered into as of the 24th day of October, 1997, by and
between Anthony Drago, Trustee, U/A DTD 8/19/80, FBO Anthony and
Sydelle Drago Family Trust (hereinafter called "Drago"), and AEI
Real Estate Fund XVIII Limited Partnership (hereinafter called
"Fund XVIII") (Drago, 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 9.3699% interest
in and to, and Drago presently owns an undivided 12.8462%
interest in and to, and The Reginald O. Hill Trust and Donna Jean
Hill Trust presently owns an undivided 12.8462% interest in and
to, and Nick DeVito, Inc. presently owns an undivided 15.6724%
interest in and to, and Anton Kuster presently owns an undivided
11.5896% interest in and to, and The Hesson Family Trust
presently owns an undivided 13.2895% interest in and to, and Arel
D. and Louise B. Middleton presently owns and undivided 10.6316%
interest (also referred to herein as Co-Tenant) 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 Drago'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 Drago 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 Drago with respect to any
expense for the Premises.
Co-Tenant Initial: /s/ AD
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
As further set forth in paragraph 2 hereof, Fund XVIII agrees to
require any lessee of the Premises to name Drago 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.
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 Drago under this
Agreement, and may pay to itself the amount of Drago's share of
any legitimate expenses of the Premises which are not paid by
Drago 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 Drago'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
Tenant under terms of any lease agreement of the Premises.
Drago has no requirement to, but has, nonetheless elected to
retain, and agrees to annually reimburse, Fund XVIII in the
amount of $740 for the expenses, direct and indirect, incurred by
Fund XVIII in providing quarterly accounting and distributions of
Drago's share of net income and for tracking, reporting and
assessing the calculation of Drago's share of operating expenses
incurred from the Premises. This invoice amount shall be pro-
rated for partial years and Drago authorizes Fund XVIII to deduct
such amount from Drago's share of revenue from the Premises.
Drago may terminate this agreement in this paragraph respecting
accounting and distributions at any time and attempt to collect
its share of rental income directly from the tenant; however,
enforcement of all other provisions of the lease remains the sole
right of Fund XVIII pursuant to Section 1 hereof. Fund XVIII may
terminate its obligation under this paragraph upon 30 days notice
to Drago prior to the end of each anniversary hereof, unless
agreed in writing to the contrary.
3. Full, accurate and complete books of account shall be kept
in accordance with generally accepted accounting principles at
Fund 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, Drago shall
be entitled to receive 12.8462% of all items of income and
expense generated by the Premises. Upon receipt of said
accounting, if the payments received by each Co-Tenant pursuant
to this Paragraph 3 do not equal, in the aggregate, the amounts
which each are entitled to receive proportional to its share of
ownership with respect to said calendar year pursuant to
Paragraph 2 hereof, an appropriate adjustment shall be made so
that each Co-Tenant receives the amount to which it is entitled.
Co-Tenant Initial: /s/ AD
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
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. Subject to the rights of any Tenant under a lease of the
Premises, Co-Tenants may, at any time, sell, finance, or
otherwise create a lien upon their interest in the Premises but
only upon their interest and not upon any part of the interest
held, or owned, by any other Co-Tenant. All Co-Tenants reserve
the right to escrow proceeds from a sale of their interests in
the Premises to obtain tax deferral by the purchase of
replacement property.
6. If any Co-Tenant, shall be in default with respect to any of
its obligations hereunder, and if said default is not corrected
within thirty (30) days after receipt by said defaulting Co-
Tenant of written notice of said default, or within a reasonable
period if said default does not consist solely of a failure to
pay money, the remaining Co-Tenant(s) may resort to any available
remedy to cure said default at law, in equity, or by statute.
7. This property management agreement shall continue in full
force and effect and shall bind and inure to the benefit of the
Co-Tenant and their respective heirs, executors, administrators,
personal representatives, successors and permitted assigns until
July 19, 2016 or upon the sale of the entire Premises in
accordance with the terms hereof and proper disbursement of the
proceeds thereof, whichever shall first occur. Unless
specifically identified as a personal contract right or
obligation herein, this agreement shall run with any interest in
the Premises and with the title thereto. Once any person, party
or entity has ceased to have an interest in fee in any portion of
the Premises, it shall not be bound by, subject to or benefit
from the terms hereof; but its heirs, executors, administrators,
personal representatives, successors or assigns, as the case may
be, shall be substituted for it hereunder. Drago agrees to
notify Fund XVIII upon the appointment of any successor trustee,
or any amendment of the Reginald O. Drago Trust or the Donna Jean
Drago Trust affecting the powers of the Trustees to manage or
dispose of the Drago Trust's interest in the Premises.
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:
Co-Tenant Initial: /s/ AD
Co-Tenancy Agreement for Taco Cabana - San Antonio, TX
Arel D. and Louise B. Middleton
P.O. Box 283
Wasco, OR 97065-0283
If to Hesson:
Ivan Hesson, Trustee
3864 Via Lasbrisas
Santa Barbera, CA 93110
If to Kuster:
Tony Kuster
4214 Danbury
Amarillo, TX 79109
If to DeVito:
Vito DeVito Francesco, Secretary/Treasurer
P.O, Box 591
Ontario, CA 91762
If to Hill:
Reginald Hill
Donna Hill
1912 Lakeside Lane
Indianapolis, IN 46229
If to Drago:
Anthony Drago, TTEE
17719 Royce Dr. W
Encino, CA 91316
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/ AD
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.
Drago Anthony and Sydelle Drago Family Trust
By: /s/ Anthony Drago
Anthony Drago, Trustee
WITNESS:
/s/ Gary Benson
Gary Benson
(Print Name)
STATE OF )
) ss
COUNTY OF )
The foregoing instrument was acknowledged before me, a
Notary Public in and for the County and State aforesaid,
this day of ,1997, by , 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:
/s/ Dawn E Campbell
Dawn E Campbell
(Print Name)
State of Minnesota )
) ss.
County of Ramsey )
I, a Notary Public in and for the state and county of aforesaid,
hereby certify there appeared before me this 24th day of October,
1997, 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/ Laura M Steidl
Notary Public
[notary seal]
Co-Tenant Initial: /s/ AD
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 or Bexar County, Texas.
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000840459
<NAME> AEI REAL ESTATE FUND XVIII LTD PARTNERSHIP
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<CASH> 3,996,690
<SECURITIES> 0
<RECEIVABLES> 2,348
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3,999,038
<PP&E> 13,570,148
<DEPRECIATION> (2,061,943)
<TOTAL-ASSETS> 15,507,243
<CURRENT-LIABILITIES> 430,671
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 15,076,572
<TOTAL-LIABILITY-AND-EQUITY> 15,507,243
<SALES> 0
<TOTAL-REVENUES> 1,188,198
<CGS> 0
<TOTAL-COSTS> 536,591
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 1,496,613
<INCOME-TAX> 0
<INCOME-CONTINUING> 1,496,613
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,496,613
<EPS-PRIMARY> 68.08
<EPS-DILUTED> 68.08
</TABLE>
