PURCHASE AGREEMENT
Timber Lodge Steakhouse - St. Cloud, MN
This AGREEMENT, entered into effective as of the 4 of October,
2000.
l. PARTIES. Seller is AEI Real Estate Fund XVII Limited
Partnership which presently owns an undivided 17.2367% interest
in the fee title to that certain real property legally described
in the attached Exhibit "A" (the "Entire Property") Buyer is The
Xxxxx Family Limited Partnership, a Minnesota limited partnership
("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 15.2418 percentage interest
(hereinafter, simply the "Property") as Tenant in Common in the
Entire Property, and including or excluding the following:
2.1 Seller owns no interest in any personal property on the
Entire Property except an interest in external signage,
which is not being conveyed to Buyer hereunder.
2.2 Leases. Seller's interests as lessor in the lease described
in paragraph 11(a) below.
2.3 Seller owns no interest in any service or maintenance
contracts or equipment leases regarding the Entire Property.
2.4 Seller owns no interest in any permits or licenses affecting
the Entire Property.
2.5 To the extent the same have been assigned or are assignable
to Seller, Seller transfers an undivided 15.2418% interest in
all warranties and guaranties benefiting the Entire Property
regarding the acquisition, construction, design, use, operation,
management, or maintenance of the Entire Property upon closing
of the transactions contemplated hereunder. This provision
shall be self operative upon closing, shall survive closing, and
shall not require any further documentation to effect the foregoing.
3. PURCHASE PRICE. The purchase price for this percentage
interest in the Entire Property is $325,000, 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,
$320,000 (the "Second Payment") into escrow in sufficient
time to allow escrow to close on the closing date.
5. CLOSING DATE. Escrow shall close on or before October 5,
2000.
6. DUE DILIGENCE. Buyer will have until the expiration of the
tenth business day (The "Review Period") after delivery of each
of following items, to be
Buyer Initial: /s/ RRR /s/ CAR
Purchase Agreement for Timber Lodge-St. Cloud, MN
supplied by Seller, to conduct all of its inspections and due
diligence and satisfy itself regarding each item, the Property,
and this transaction. Buyer agrees to indemnify and hold Seller
harmless for any loss or damage to the Entire Property or persons
caused by Buyer or its agents arising out of such physical
inspections of the Entire Property.
(a) The original and one copy of a title insurance
commitment for an Owner's Title insurance policy (see
paragraph 8 below).
(b) A copy of a Certificate of Occupancy or other such
document certifying completion and granting permission to
permanently occupy the improvements on the Entire Property
as are in Seller's possession.
(c) A copy of an "as built" survey of the Entire Property
done concurrent with Seller's acquisition of the Property.
(d) Lease (as further set forth in paragraph 11(a) below) of
the Entire Property showing occupancy date, lease expiration
date, rent, and Guarantys, if any, accompanied by such
tenant financial statements as may have been provided most
recently to Seller by the Tenant and/or Guarantors.
(e) copies of any and all environmental reports affecting
the Entire Property as are in Seller's possession.
It is a contingency upon Seller's obligations hereunder that two
(2) copies of Co-Tenancy Agreement in the form attached hereto
duly executed by Buyer and AEI Real Estate Fund XVII Limited
Partnership and dated on escrow closing date be delivered to the
Seller on the closing date.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under the first paragraph of section 6 of this
agreement. (which will survive), Buyer (after execution of such
documents reasonably requested by Seller to evidence the
termination hereof) shall be returned its First Payment, and
Buyer will have absolutely no rights, claims or interest of any
type in connection with the Property or this transaction,
regardless of any alleged conduct by Seller or anyone else.
Unless this Agreement is canceled by Buyer pursuant to the
terms hereof, and unless Seller is in default under any of the
terms of this Agreement, if Buyer fails to make Second Payment,
Seller shall be entitled to retain the First Payment. Such notice
shall be given as further set forth herein respecting the
delivery of notice. If this Agreement is not cancelled as set
forth above, the First Payment shall be non-refundable unless
Seller shall default hereunder.
If Buyer cancels this Agreement as permitted under this
Section, except for any escrow cancellation fees and any
liabilities under the first paragraph of section 6 of this
agreement (which will survive), Buyer (after execution of such
documents reasonably requested by Seller to evidence the
termination hereof) shall be returned its First Payment, and
Buyer will have absolutely no rights, claims or interest of any
type in connection with the Property or this transaction,
regardless of any alleged conduct by Seller or anyone else.
Unless this Agreement is canceled by Buyer pursuant to the
terms hereof, if Buyer fails to make the Second Payment, Seller
shall be entitled to retain the First Payment and Buyer
irrevocably will be deemed to be in default under this Agreement.
Seller may, at its option, retain the First Payment and declare
this Agreement null and void, in which event Buyer will be deemed
to have canceled this Agreement and relinquish all rights in and
to the Property
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Purchase Agreement for Timber Lodge-St. Cloud, MN
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 agreement of a
reputable title company qualified to do business in Minnesota,
selected by Seller to issue an Owner's policy of title insurance,
dated as of the close of escrow, in an amount equal to the
purchase price, insuring that Buyer will own insurable title to
the Property subject only to: the title company's standard
exceptions; current real property taxes and assessments; survey
exceptions; the rights of parties in possession pursuant to the
lease defined in paragraph 11 below; all matters of public
record; and other items disclosed to Buyer during the Review
Period.
Buyer shall be allowed seven (7) business days after receipt
of said commitment for examination and the making of any
objections to marketability thereto, said objections to be made
in writing or deemed waived. If any objections are so made, the
Seller shall be allowed eighty (80) days to make such title
marketable or in the alternative to obtain a commitment for
insurable title insuring over Buyer's objections. If Seller
shall decide to make no efforts to make title marketable, or is
unable to make title marketable or obtain insurable title, (after
execution by Buyer of such documents reasonably requested by
Seller to evidence the termination hereof) Buyer's First Payment
shall be returned and this Agreement shall be null and void and
of no further force and effect. Seller has no obligation to
spend any funds or make any effort to satisfy Buyer's objections,
if any.
Pending satisfaction of Buyer's objections, the payments
hereunder required shall be postponed, but upon satisfaction of
Buyer's objections and within ten (10) days after written notice
of satisfaction of Buyer's objections to the Buyer, the parties
shall perform this Agreement according to its terms.
9. CLOSING COSTS. Seller will pay one-half of escrow fees, the
cost of the title commitment, state deed tax, 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.
Buyer Initial: /s/ RRR /s/ CAR
Purchase Agreement for Timber Lodge-St. Cloud, MN
10. REAL ESTATE TAXES, SPECIAL ASSESSMENTS AND PRORATIONS.
(a) Because the Entire Property (of which the Property is a
part) is subject to a triple net lease (as further set forth
in paragraph 11(a)(i), the parties acknowledge that there
shall be no need for a real estate tax proration. However,
Seller represents that to the best of its knowledge, all
real estate taxes and installments of special assessments
due and payable in all years prior to the year of Closing
have been paid in full. Unpaid real estate taxes and unpaid
levied and pending special assessments existing on the date
of Closing shall be the responsibility of Buyer and Seller
in proportion to their respective Tenant in Common
interests, pro-rated, however, to the date of closing for
the period prior to closing, if Tenant shall not pay the
same. Seller and Buyer shall likewise pay all taxes due and
payable in the year after Closing and any unpaid
installments of special assessments payable therewith and
thereafter, if such unpaid levied and pending special
assessments and real estate taxes are not paid by any tenant
of the Entire Property.
(b) All income and all operating expenses from the Entire
Property shall be prorated between the parties and adjusted
by them as of the date of Closing. Seller shall be entitled
to all income earned and shall be responsible for all
expenses incurred prior to the date of Closing, and Buyer
shall be entitled to its proportionate share of all income
earned and shall be responsible for its proportionate share
of all operating expenses of the Entire Property incurred on
and after the date of closing.
11. SELLER'S REPRESENTATION AND AGREEMENTS.
(a) Seller representations and warrants.
(i) Seller owns the Entire Property, free and clear of all
encumbrances, except for matters of title as shall be revealed on
the title commitment pursuant to paragraph 8 hereof, and except
for the Lease Agreement in existence between AEI Real Estate Fund
XV Limited Partnership, AEI Real Estate Fund XVII Limited
Partnership, and Institutional Net Lease Fund '93 Limited
Partnership (as "Landlord") and Timber Lodge Steakhouse, Inc.
("Tenant"), dated November 18, 1997. Seller is not aware of any
other leases of the Property. The above referenced lease
agreement has an option to purchase in favor of the Tenant as set
forth in paragraph 33 of said lease agreement. Seller has
delivered to Buyer a correct and complete copy of each lease
agreement and all amendments thereto. Said lease is in full
force and neither Seller nor Lessee is in default under the
lease.
(ii) It is not aware of any pending litigation or
condemnation proceedings against the Property or Seller's
interest in the Property.
(ii) Seller has received no notice of actual or threatened
reduction or curtailment of any utilty service now supplied to
the Entire Property.
Buyer Initial: /s/ RRR /s/ CAR
Purchase Agreement for Timber Lodge-St. Cloud, MN
(iii) Seller has received no notice of actual or threatened
cancellation or suspension of any certificates of occupancy for
any portion of the Entire Property.
(iv) Seller has received no notice of actual or threatened
special assessments or reassessments of the Entire Property.
(v) Seller has made available to Buyer a correct and complete
copy of each permit, or license relating to the Entire Property
including permits relating to Hazardous Substances, and its
amendments, in Seller's possession. To the best of Seller's
knowledge: the permits are in full force, and Seller is not in
default under the Permits. To the best of Seller's knowledge: no
other permits are required from any governmental entity in order
to operate the Entire Property as it is now operated
(vi) To the best of Seller's knowledge:
No toxic or hazardous substances or wastes, pollutants
or contaminants (including without limitation, asbestos,
urea formaldehyde, the group of organic compounds known as
polychlorinated biphenyls, petroleum products including
gasoline, fuel, oil, crude oil and various constituents of
such products, and any hazardous substances as defined in
any Environmental Law (collectively, "Hazardous Substances")
have been generated, treated, stored, transferred from,
released or disposed of, or otherwise placed, deposited in
or located on the Entire Property in violation of any
Environmental Law nor has any activity been undertaken on
the Property that would cause or contribute to the Entire
Property becoming a treatment, storage or disposal facility
within the meaning of any Environmental Law. The term "
Environmental Law" shall mean any and all federal, state and
local laws, statutes, codes, or ordinances, regulations,
rules, policies, consent decrees, judicial orders,
administrative orders or other requirements relating to the
environment or to human health or safety associated with the
environment, all as amended or modified from time to time.
There has been no discharge, release or threatened release
of Hazardous Substances from the Entire Property, and there
are no Hazardous Substances or conditions in or on the
Entire Property that may support a claim or cause of action
under any Environmental Law. The Entire Property is not
now, and to the best of Seller's knowledge, never has been,
listed on any list of sites contaminated with Hazardous
Substances, nor used as landfill, dump, disposal or storage
site for Hazardous Substances. Seller has maintained all
records required to be kept concerning the presence,
location and quantity of asbestos containing materials, and
presumed asbestos containing materials, in the Entire
Property and will deliver the same to Buyer on or before
closing.
(vi) Seller has not entered into any other contracts for the
sale of the Property, nor are there any rights of first
refusal or options to purchase the Property or any other
rights of others that might prevent the consummation of this
Agreement, other than as disclosed herein.
(vii) To the best of Seller's knowledge, Seller is not in
default concerning any of its obligations or liabilities
regarding the Entire Property.
Buyer Initial: /s/ RRR /s/ CAR
Purchase Agreement for Timber Lodge-St. Cloud, MN
(viii) To the best of Seller's knowledge, any operating
statements for the Entire Property that have been supplied
from third parties by Seller to Buyer are correct and
complete. Any such operating statements prepared by and
supplied by Seller are true and correct.
(ix) Seller is not a "foreign person", "foreign
partnership", "foreign trust" or " foreign estate" as those
terms are defined in Section 1445 of the Internal Revenue
Code.
(x) There is no action, litigation, investigation,
condemnation or proceeding of any kind pending or to the
best of Seller's knowledge threatened against Seller or any
portion of the Entire Property.
(xi) To the best knowledge of Seller: the buildings,
structures and improvements included within the Entire
Property are structurally sound and in good repair in first-
class condition, and all mechanical, electrical, heating,
air conditioning, drainage, sewer, water and plumbing
systems are in proper working order.
(xii) The Seller certifies and warrants that the Seller does
not know of any "Xxxxx" on the Entire Property within the
meaning of Minn. Stat. Sect.1031.
(xii) To the best knowledge of Seller: no above ground or
underground tanks, are located in or about the Entire
Property, or have been located under, in or about the Entire
Property and have subsequently been removed or filled.
(xiii) Seller has delivered to Buyer copies of all
environmental reports and studies relating to the Entire
Property which are in the possession of Seller.
(xiv) Solely for purposes of satisfying the requirements of
Minn. Stat. 115.55 Seller represents that to the best of its
knowledge, there is no "individual sewage treatment system"
(within the meaning of that statute) on or serving the
Entire Property.
(xv) Seller is a duly founded limited partnership and is in
good standing under the laws of the State of Minnesota;
Seller is duly qualified to transact business in the state
of Minnesota; Seller has the requisite power and authority
to enter into and perform this agreement; and the
performance of this agreement will not conflict with or
result in a violation of any of Seller's limited partnership
documents, or any judgment, order, or decree of any court.
(xvi)The above representations and warranties will be true
and effective as of the closing date as if Seller had made
the same at closing, and shall survive the closing of this
transaction.
(xvii) In addition to the acts and deeds recited herein and
contemplated to be performed, executed, and delivered by
Seller, Seller 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,
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Purchase Agreement for Timber Lodge-St. Cloud, MN
deeds and assurances as Buyer or the Title Company may
require and be reasonable in order to consummate the
transactions contemplated herein.
(xix) Seller will indemnify Buyer, its successors and
assigns, against, and will hold Buyer, its successors and
assigns, harmless from, any expenses or damages, including
reasonable attorneys' fees, that Buyer incurs because of the
breach of any of the above representations and warranties,
whether such breach is discovered before or after closing.
Wherever herein a representation is made "to the best
knowledge of Seller", such representation is limited to the
(actual) knowledge of the Seller. This obligation of Seller
shall survive closing.
(xx) Except as previously disclosed to Buyer and as
permitted in paragraph (b) below, Seller is not aware of any
contracts Seller has executed that would be binding on Buyer
after the closing date.
(b) Provided that Buyer performs its obligations when
required, Seller agrees that it will not enter into any new
contracts that would materially affect the Property and be
binding on Buyer after the Closing Date without Buyer's
prior consent, which will not be unreasonably withheld.
However, Buyer acknowledges that Seller retains the right
both prior to and after the Closing Date to freely transfer
all or a portion of Seller's remaining undivided interest in
the Entire Property, provided such sale shall not encumber
the Property being purchased by Buyer in violation of the
terms hereof or the contemplated Co-Tenancy Agreement.
12. DISCLOSURES.
(a) Seller has not received any notice of any material,
physical, or mechanical defects of the Entire Property,
including without limitation, the plumbing, heating, air
conditioning, ventilating, electrical system. To the best of
Seller's knowledge without inquiry, all such items are in
good operating condition and repair and in compliance with
all applicable governmental, zoning, and land use laws,
ordinances, regulations and requirements. If Seller shall
receive any notice to the contrary prior to Closing, Seller
will inform Buyer prior to Closing.
(b) Seller has not received any notice that the use and
operation of the Entire Property is not in full compliance
with applicable building codes, safety, fire, zoning, and
land use laws, and other applicable local, state and federal
laws, ordinances, regulations and requirements. If Seller
shall receive any notice to the contrary prior to Closing,
Seller will inform Buyer prior to Closing.
(c) Seller knows of no facts nor has Seller failed to
disclose to Buyer any fact known to Seller which would
prevent the Tenant from using and operating the Entire
Property after the Closing in the manner in which the Entire
Property has been used and operated prior to the date of
this Agreement. If Seller shall receive any notice to the
contrary prior to Closing, Seller will inform Buyer prior to
Closing.
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Purchase Agreement for Timber Lodge-St. Cloud, MN
(d) Seller has not received any notice that the Entire
Property is in violation of any federal, state or local law,
ordinance, or regulations relating to industrial hygiene or
the environmental conditions on, under, or about the Entire
Property, including, but not limited to, soil, and
groundwater conditions. To the best of Seller's knowledge,
there is no proceeding or inquiry by any governmental
authority with respect to the presence of Hazardous
Materials on the Entire Property or the migration of
Hazardous Materials from or to other property. Buyer agrees
that Seller will have no liability of any type to Buyer or
Buyer's successors, assigns, or affiliates in connection
with any Hazardous Materials on or in connection with the
Entire Property either before or after the Closing Date,
except such Hazardous Materials on or in connection with the
Entire Property arising out of Seller's gross negligence or
intentional misconduct. If Seller shall receive any notice
to the contrary prior to Closing, Seller will inform Buyer
prior to Closing.
(e) BUYER AGREES THAT IT SHALL BE PURCHASING THE PROPERTY
IN ITS THEN PRESENT CONDITION, AS IS, WHERE IS, AND SELLER
HAS NO OBLIGATIONS TO CONSTRUCT OR REPAIR ANY IMPROVEMENTS
THEREON OR TO PERFORM ANY OTHER ACT REGARDING THE PROPERTY,
EXCEPT AS EXPRESSLY PROVIDED HEREIN.
(f) BUYER ACKNOWLEDGES THAT, HAVING BEEN GIVEN THE
OPPORTUNITY TO INSPECT THE ENTIRE PROPERTY AND SUCH
FINANCIAL INFORMATION ON THE LESSEE AND GUARANTORS OF THE
LEASE AS BUYER OR ITS ADVISORS SHALL REQUEST, IF IN SELLER'S
POSSESSION, BUYER IS RELYING SOLELY ON ITS OWN INVESTIGATION
OF THE PROPERTY AND NOT ON ANY INFORMATION PROVIDED BY
SELLER OR TO BE PROVIDED EXCEPT AS SET FORTH HEREIN. BUYER
FURTHER ACKNOWLEDGES THAT THE INFORMATION PROVIDED AND TO BE
PROVIDED BY SELLER WITH RESPECT TO THE PROPERTY, THE ENTIRE
PROPERTY AND TO THE LESSEE AND GUARANTORS OF LEASE WAS
OBTAINED FROM A VARIETY OF SOURCES AND SELLER NEITHER (A)
HAS MADE INDEPENDENT INVESTIGATION OR VERIFICATION OF SUCH
INFORMATION TO BE SUPPLIED BY OR PREPARED BY THIRD PARTIES,
OR (B) MAKES ANY REPRESENTATIONS AS TO THE ACCURACY OR
COMPLETENESS OF SUCH INFORMATION SUPPLIED OR PREPARED BY
THIRD PARTIES, EXCEPT AS HEREIN SET FORTH. EXCEPT AS
OTHERWISE PROVIDED HEREIN, THE SALE OF THE PROPERTY AS
PROVIDED FOR HEREIN IS MADE ON AN "AS IS" BASIS, AND BUYER
EXPRESSLY ACKNOWLEDGES THAT, IN CONSIDERATION OF THE
AGREEMENTS OF SELLER HEREIN, EXCEPT AS OTHERWISE SPECIFIED
HEREIN IN PARAGRAPH 11(A) AND (B) ABOVE AND THIS PARAGRAPH
12, SELLER MAKES NO WARRANTY OR REPRESENTATION, EXPRESS OR
IMPLIED, OR ARISING BY OPERATION OF LAW, INCLUDING, BUT NOT
LIMITED TO, ANY WARRANTY OF CONDITION, HABITABILITY,
TENANTABILITY, SUITABILITY FOR COMMERCIAL PURPOSES,
MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE, IN
RESPECT OF THE PROPERTY.
The provisions (d) - (f) above shall survive Closing.
13. CLOSING.
(a) Before the closing date, Seller will deposit into escrow an
executed limited warranty deed warranting title against lawful
claims by, through, or under a conveyance from Seller, but not
further or otherwise, conveying insurable title of the Property
to Buyer, subject to the exceptions contained in paragraph 8
above. At closing, Seller
Buyer Initial: /s/ RRR /s/ CAR
Purchase Agreement for Timber Lodge-St. Cloud, MN
will deliver to Buyer (for Buyer's signature as well)
an executed Assignment and Assumption of Lease
assigning to the Buyer an undivided 15.2418 percentage
interest in Lessor's interest in the Lease (such
Assignment and Assumption to be in a form reasonably
acceptable to Buyer), and if prepared by Buyer or its
counsel, Seller shall execute a Certificate as to the
truth of Seller's Representations and Warranties as of
the closing date, if such Certificate is in a form
reasonably satisfactory to Seller.
(b) On or before the closing date, Buyer will deposit into
escrow: the balance of the purchase price when required
under Section 4; any additional funds required of Buyer,
(pursuant to this agreement or any other agreement executed
by Buyer) to close escrow. Both parties will sign and
deliver to the escrow holder any other documents reasonably
required by the escrow holder to close escrow.
(c) On the closing date, if escrow is in a position to
close, the escrow holder will: record the deed in the
official records of the county where the Property is
located; cause the title company to commit to issue the
title policy; immediately deliver to Seller the portion of
the purchase price deposited into escrow by cashier's check
or wire transfer (less debits and prorations, if any);
deliver to Seller and Buyer a signed counterpart of the
escrow holder's certified closing statement and take all
other actions necessary to close escrow; deliver to Seller
and/or Buyer any other document required by this Agreement.
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 defaults, Buyer will be relieved of all
obligations, will be entitled to the immediate return of its
First Payment, and Buyer shall retain all remedies available to
Buyer at law or equity.
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.
(ii) 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/ RRR /s/ CAR
Purchase Agreement for Timber Lodge-St. Cloud, MN
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
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Purchase Agreement for Timber Lodge-St. Cloud, MN
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 Richfield Bank and Trust
which will act as Accommodator to perfect the 1031 exchange by
preparing an agreement of exchange of Real Property whereby
Richfield Bank and Trust will be an independent third party
purchasing the ownership interest in subject property from Seller
and selling the ownership interest in subject property to Buyer
under the same terms and conditions as documented in this
Purchase Agreement. Buyer asks the Seller, and Seller agrees to
cooperate in the perfection of such an exchange if at no
additional cost or expense to Seller or delay in time. Buyer
hereby indemnifies and holds Seller harmless from any claims
and/or actions resulting from said exchange. Pursuant to the
direction of Richfield Bank and Trust , Seller will deed the
Property to Buyer.
18. CANCELLATION
If any party elects to cancel this Contract because of any
breach by another party or because escrow fails to close by
the agreed date, the party electing to cancel shall deliver
to escrow agent a notice containing the address of the party
in breach and stating that this Contract shall be cancelled
unless the breach is cured within 10 days following the
delivery of the notice to the escrow agent. Within three
days after receipt of such notice, the escrow agent shall
send it by United States Mail to the party in breach at the
address contained in the Notice and no further notice shall
be required. If the breach is not cured within the 10 days
following the delivery of the notice to the escrow agent,
this Contract shall be cancelled.
19. MISCELLANEOUS.
(a) This Agreement may be amended only by written agreement
signed by both Seller and Buyer, and all waivers must be in
writing and signed by the waiving party. Time is of the
essence. This Agreement will not be construed for or
against a party whether or not that party has drafted this
Agreement. If there is any action or proceeding between the
parties relating to this Agreement the prevailing party will
be entitled to recover attorney's fees and costs. This is
an integrated agreement containing all agreements of the
parties about the Property and the other matters described,
and it supersedes any other agreements or understandings.
Exhibits attached to this Agreement are incorporated into
this Agreement.
(b) If this escrow has not closed by October 6, 2000,
through no fault of Seller, Seller may either, at its
election, extend the closing date or exercise any remedy
available to it by law, including terminating this
Agreement.
(c) Funds to be deposited or paid by Buyer must be good and
clear funds in the form of cash, cashier's checks or wire
transfers.
Buyer Initial: /s/ RRR /s/ CAR
Purchase Agreement for Timber Lodge-St. Cloud, MN
(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 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: Xxxxxx X. Xxxxxxx
AEI Real Estate Fund XVII Limited Partnership
1300 Minnesota World Trade Center
00 X. 0xx Xxxxxx
Xx. Xxxx, XX 00000
If to Buyer:
The Xxxxx Family Limited Partnership
0000 Xxxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
20. Contingencies: The obligations of Buyer under this Agreement
are contingent upon each of the following:
(i) REPRESENTATIONS AND WARRANTIES . The
representations and warranties of Seller contained in
this Agreement must be true now and on the Closing Date
as if made on the Closing Date and Seller shall have
delivered to Buyer on the Closing Date a certificate
dated the Closing Date, signed by an authorized
representative of Seller, certifying that such
representations and warranties are true as of the
Closing Date. Buyer or its counsel shall prepare such
certificate
(ii) TITLE. Title shall have been found acceptable, or
been made acceptable, in accordance with the
requirements and terms of this Agreement.
(iii) DOCUMENT REVIEW. On or before 10 business days
after the signing of this Agreement, Seller shall
deliver to Buyer true and complete copies of all
Leases, and other due diligence as required herein for
Buyer's review and analysis. Seller shall allow Buyer
to interview Tenants of the Entire Property. Buyer
shall have determined, on or before the date which is
10 Business days after the last such document is
delivered, that it is satisfied, in its sole judgment,
with its review and analysis of the Leases, title, and
any other due diligence.
(III) ESTOPPEL CERTIFICATES. Buyer shall have received, on
or before the Closing Date, estoppel certificates from all
tenants under Leases, which certificates shall disclose no
facts which are material or contradictory to those facts
previously disclosed in Buyer's prior review of the Leases
or which are material to Buyer's acquisition of the
Property, and shall confirm the rents
Buyer Initial: /s/ RRR /s/ CAR
Purchase Agreement for Timber Lodge-St. Cloud, MN
payable by such tenant. Seller shall use its best
efforts to obtain estoppel certificates from each of
such tenants; provided Seller shall not be required to
expend significant moneys or make significant
concessions in order to obtain such estoppel
certificates. If a tenant shall fail to deliver an
estoppel certificate, Seller may deliver at closing an
estoppel certificate signed by Seller representing the
same facts as such tenant would have represented in the
missing estoppel certificate.
If a contingency which is required to be satisfied on or
before a specified date has not been satisfied on or before that
date, or if a contingency which is required to be satisfied on or
before the Closing Date has not been satisfied on or before the
Closing Date, then in either case this Agreement may be
terminated, at Buyer's option, by written notice from Buyer to
Seller given not more than five days after the said date or on
the Closing Date, as the case may be. Upon such termination, the
First Payment and any interest accrued thereon shall be released
to Buyer and upon such return, neither party will have any
further rights or obligations regarding this Agreement or the
Entire Property except as otherwise permitted in this Agreement.
All the contingencies set forth in this Agreement are
specifically stated and agreed to be for the sole and exclusive
benefit of the Buyer and the Buyer shall have the right to
unilaterally waive any contingency by written notice to Seller.
If Buyer shall fail to give such notice on or before such date
than the contingency shall be deemed to have been satisfied.
Seller shall allow Buyer, and Buyer's agents, access to the
Entire Property without charge and at all reasonable times for
the purpose of Buyer's investigation of the same. Seller shall
make available to Buyer and Buyer's agents without charge all
plans and specifications, records, permits and material
correspondence in Seller's possession relating to the Entire
Property and Hazardous Substances, if any, affecting the
Property. Buyer shall pay all cost and expenses of such
investigation and shall hold Seller and the Entire Property
harmless from all costs and liabilities relating to Buyer's
activities. 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. Buyer shall further repair and restore
any damage to the Entire Property caused by or occurring during
Buyer's testing and return the Entire Property and /or Personal
Property to substantially the same condition as existed prior to
such entry.
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.
This Agreement shall be governed by, and interpreted in
accordance with, the laws of the state of Minnesota.
REMAINDER OF THE PAGE INTENTIONALLY LEFT BLANK
Buyer Initial: /s/ RRR /s/CAR
Purchase Agreement for Timber Lodge-St. Cloud, MN
IN WITNESS WHEREOF, the Seller and Buyer have executed this
Agreement effective as of the day and year above first written.
BUYER: The Xxxxx Family Limited Partnership
By: /s/ Xxxxxx X Xxxxx
Xxxxxx X. Xxxxx, General Partner
By: /s/ Xxxxx X Xxxxx
Xxxxx X. Xxxxx, General Partner
SELLER: AEI Real Estate Fund XVII Limited Partnership
By: AEI Fund Management XVII, Inc., its
corporate general partner
By:/s/ Xxxxxx X Xxxxxxx
Xxxxxx X. Xxxxxxx, President
Buyer Initial: /s/ RRR /s/CAR
Purchase Agreement for Timber Lodge-St. Cloud, MN
EXHIBIT A
That part of Lot Two (2), Block One (1) Xxxxxxx Addition, a duly
recorded plat in the office of the County Recorder/Registrar of
titles in Xxxxxxx County, Minnesota, lying North of a line drawn
parallel with and 327.20 feet Southerly of, as measured at right
angles to, the most Northerly line of said Lot Two (2); together
with the rights of ingress, egress, utilities easements and such
other rights which constitue an interest in real property as
created in that certain Easement and Maintenance Agreement dated
Dec. 10, 1996, filed of record Dec. 13, 1996 as Document Xx.
000000, xxx xx xxxxxxx xx Xxxxxxxx Xx. 00000.
