PURCHASE AGREEMENT
Champps, 00000 Xxxxxxxxxx Xxxx, Xxxxxxx, Xxxxx
This AGREEMENT, entered into effective as of the 3rd of May,
2006.
l. PARTIES. Seller is AEI Income & Growth Fund 24 LLC which owns
an undivided 100% interest in the fee title to that certain real
property legally described in the attached Exhibit "A" (the
"Property"), commonly known as 00000 Xxxxxxxxxx Xxxx, Xxxxxxx,
Xxxxx. Buyer is Champps Operating Corporation, a Minnesota
corporation, the parent of the current lessee of the property,
Champps Entertainment of Texas, Inc ("Lessee"). Seller wishes to
sell and Buyer wishes to buy the Property.
2. PROPERTY. The Property to be sold to Buyer in this transaction
consists of an undivided 100% interest in the Property. Seller
owns no interest in any personalty in connection with the
Property.
3. PURCHASE PRICE. The purchase price for this Property is
$3,150,100 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 $5,100.00 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. One Hundred Dollars of the First Payment
shall be considered non-refundable, binding Option Consideration
as required under Texas law.
(b) Buyer will deposit the balance of the purchase price,
$3,145,000 (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 June 15, 2006.
6. DUE DILIGENCE. Buyer or Lessee has been in continuous
possession and control of the property since April 8, 2002, and
as such, has had ample opportunity to conduct such due diligence
on the Property as it deems appropriate.
Buyer shall order at its own expense such title, survey, and
any other due diligence information as Buyer shall deem
necessary. Buyer may only object to those matters of title or
survey encumbering the Property and caused by Seller without
Buyer's or Lessee's knowledge and written consent.
7. ESCROW. Escrow shall be opened by Seller and the First Payment
deposited in escrow with a closing agent as selected by Buyer in
Houston, Texas, for LandAmerica Partners Title Company, or other
such agent as may be mutually agreeable to the parties, upon
acceptance of this Agreement by both parties. 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. If there is any
conflict between these other instructions and this Agreement,
this Agreement will control.
8. CLOSING COSTS. Seller shall pay no closing costs in
connection with the transaction contemplated herein, except its
own legal fees. Each party will pay its own attorney's fees
and costs to document this transaction.
9. REAL ESTATE TAXES, SPECIAL ASSESSMENTS AND PRORATIONS.
(a) Because the Property is subject to a triple net lease (as
further set forth in paragraph 10(a)(i), the parties acknowledge
that there shall be no need for a real estate tax proration.
(b) All income and all operating expenses including rent from
the 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 prior to the date of Closing, Buyer shall be
responsible for all operating expenses of the Property prior to
Closing, and Buyer shall be entitled to all income earned and
shall be responsible for all operating expenses of the Property
incurred on and after the date of Closing.
(c) These provisions shall survive Closing.
10. SELLER'S REPRESENTATION AND AGREEMENTS.
(a) Seller represents and warrants as of this date that:
(i) Except for the Lease Agreement dated April 8, 2002, in
existence between Seller (as Lessor) and Champps Entertainment or
Texas, Inc. (as Tenant or Lessee), (the "Lease"), Seller is not
aware of any leases of the Property.
(ii) It is not aware of any pending litigation or condemnation
proceedings against the Property or Seller's interest in the
Property.
(iii) Except as previously disclosed to Buyer and as
permitted in paragraph (b) below, Seller is not aware of any
contracts Seller has executed that would be binding on Buyer
after the closing date.
(iv) Seller is not now, nor at the Closing shall Seller be, a non-
resident alien or a foreign person, corporation, partnership,
trust, estate or entity, in each case within the purview of
Section 1445 of the Internal Revenue Code. Seller agrees to
comply with Section 1445 of the Internal Revenue Code and at the
Closing will complete and submit to Buyer such instruments in
connection therewith as Buyer and/or the Title Company may
require.
(v) Seller 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.
(vi) 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, deeds and assurances as Buyer
or the Title Company may require and be reasonable in order to
consummate the transactions contemplated herein.
(vii) To Seller'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 Seller is a party or
by which Seller is bound.
(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.
11. DISCLOSURES.
(a) Seller has not received any notice of any material,
physical, or mechanical defects of the Property, including
without limitation, the plumbing, heating, air conditioning,
ventilating, and electrical systems. 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 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 Property
after the Closing in the manner in which the 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.
(d) Seller has not received any notice that the 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 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. To the best of Seller's knowledge,
without inquiry: the Property is not, and at the time of the
Closing shall not have been, used for the generation, storage,
transport or disposal of, or contaminated or threatened with
contamination from outside sources by, any oil, hazardous waste
(as defined in the Resource Conversation and Recovery Act, as
amended, 42 U.S.C. Section 6291 et seq.), hazardous substances
(as defined in the Comprehensive Environmental Response,
Compensation and Liability Act, as amended, 42 U.S.C. Section
9601 et seq.), or hazardous materials (as defined in the
Hazardous Material Transportation Act, 49 U.S.C. Section 1801 et.
seq.) (or as any of the foregoing are defined in any other
federal law, in any applicable state or local law or in any
regulations adopted pursuant to any of the foregoing statutes or
other laws), and the Property has never been used as, nor at the
time of the Closing shall the Property ever have been used as, a
land fill or dump site. 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. 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 OR AS CAUSED BY SELLER'S
GROSS NEGLIGENCE OR INTENTIONAL MISCONDUCT.
(f) BUYER ACKNOWLEDGES THAT, ITS WHOLLY OWNED SUBSIDIARY,
LESSEE, HAVING BEEN IN POSSESSION OF THE PROPERTY AND SUCH
FINANCIAL INFORMATION ON THE LESSEE AND GUARANTORS OF THE
LEASE AS BUYER OR ITS ADVISORS SHALL REQUIRE, 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, IF ANY, TO BE PROVIDED BY SELLER WITH
RESPECT TO THE PROPERTY, TO THE LESSEE, AND TO THE
GUARANTORS OF LEASE, WAS OBTAINED FROM A VARIETY OF SOURCES
AND SELLER NEITHER (A) HAS MADE INDEPENDENT INVESTIGATION OR
VERIFICATION OF SUCH INFORMATION, OR (B) MAKES ANY
REPRESENTATIONS AS TO THE ACCURACY OR COMPLETENESS OF SUCH
INFORMATION EXCEPT AS HEREIN SET FORTH. THE SALE OF THE
PROPERTY AS PROVIDED FOR HEREIN IS MADE ON AN "AS IS" BASIS,
AND BUYER EXPRESSLY ACKNOWLEDGES THAT, IN CONSIDERATION OF
THE AGREEMENTS OF SELLER HEREIN, EXCEPT AS OTHERWISE
SPECIFIED HEREIN IN PARAGRAPH 11(A) AND (B) ABOVE AND THIS
PARAGRAPH 12, SELLER MAKES NO WARRANTY OR REPRESENTATION,
EXPRESS OR IMPLIED, OR ARISING BY OPERATION OF LAW,
INCLUDING, BUT NOT LIMITED TO, ANY WARRANTY OF CONDITION,
HABITABILITY, TENANTABILITY, SUITABILITY FOR COMMERCIAL
PURPOSES, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR
PURPOSE, IN RESPECT OF THE PROPERTY.
The provisions of (a)-(c) above shall survive the closing
for a period of six (6) months. The provisions (d) - (f)
above shall survive Closing.
12. CLOSING.
(a) Before the closing date, Seller will deposit into
escrow an executed special warranty deed warranting title against
lawful claims by, through, or under a conveyance from Seller, but
not further or otherwise, conveying insurable title of the
Property to Buyer, subject to all exceptions of record except
those encumbering the Property and caused by Seller without
Buyer's or Lessee's knowledge and written consent. On or before
the closing date, Seller shall also deposit into escrow and
executed Assignment of Lease assigning all of Seller's rights,
title and interest in the Lease as Landlord to the Buyer, and the
written consent of Lessee and waiver of Lessee's Right of First
Refusal as set forth in the Lease.
(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 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.
13. 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. Provided, however, that in no event
shall Buyer be liable for any, punitive, consequential or
speculative damages arising out of any default by Buyer
hereunder.
If Seller shall default, Buyer may, at its option, in
addition to any other remedies provided herein, (1) terminate
this agreement and recover all xxxxxxx money and other amounts
paid hereunder, together with all expenses paid or incurred by
Buyer (including reasonable attorneys' fees) in contemplation of
Seller's performance hereunder, in which event this agreement
will be null and void and without recourse to any party in law or
in equity, (2) proceed with this agreement and purchase the
Property subject to an abatement in the Purchase Price
satisfactory to the parties, or (3) pursue any other legal or
equitable remedy, including without limitation, specific
performance. Provided, however, that in no event shall Seller be
liable for any, punitive, consequential or speculative damages
arising out of any default by Seller hereunder.
14. 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.
15. 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 June 30, 2006 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:
AEI Income & Growth Fund 24 LLC
Attention: Xxxxxx X. Xxxxxxx and Xxxxxx Xxxxx
0000 Xxxxx Xxxxx Xxxxx
00 Xxxx Xxxxxxx Xxxxxx
Xx. Xxxx, XX 00000
If to Buyer:
Champps Entertainment of Texas, Inc.
Attention: Xxxx Xxxxxx and Xxxxx Xxxxxxx
00000 Xxxx Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000-00000
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 Texas.
IN WITNESS WHEREOF, the Seller and Buyer have executed this
Agreement effective as of the day and year above first written.
BUYER: Champps Operating Corporation
By: /s/ Xxxxx Xxxxxx
Its: CFO
SELLER: AEI INCOME & GROWTH FUND 24 LLC
By: AEI Fund Management XXI, Inc., a Minnesota corporation
By: /s/ Xxxxxx X Xxxxxxx
Xxxxxx X. Xxxxxxx, its President
(THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK)
EXHIBIT "A"
LEGAL DESCRIPTION
All that certain 1.538 acres of land, out of Camden Park at
Royal Oaks, Sec. 3, according to the plat thereof recorded
under Film code No. 470101, in the Map Records of Xxxxxx
County, Texas, in the Xxxxx Xxxxxxxx Survey, A-844, Xxxxxx
County, Texas, and more particularly described by metes and
bounds as follows: (All bearings based on the Texas State
Plane Coordinate System, South Central Zone)
BEGINNING at a 5/8" iron rod found for the northeast corner
of said Camden Park at Royal Oaks, Sec. 3, common to the
northwest corner of Westchase Subdivision, Section Eighteen,
according to the plat thereof recorded under Volume 291,
Page 49, in the Map Records of Xxxxxx County, Texas, and
common to the northeast corner of the herein described
tract, in the south right-of-way line of Westheimer Road
(120' R.O.W.);
THENCE S 02 30' 21" E - 263.09', along the east line of said
Camden Park at Royal Oaks, Sec. 3, common to the west line
of said Westchase Subdivision, Section Eighteen, to a 3/4"
iron rod set for the southeast corner of the herein
described tract;
THENCE S 87 18' 52" W - 254.63', departing said common line,
to a P-K nail set in concrete for the southwest corner of
herein described tract;
THENCE N 02 30' 21" W - 263.09' to a 3/4" iron rod set for
the northwest corner of the herein described tract, in the
north line of the aforesaid Camden Park at Royal Oaks, Sec.
3, in the south right-of-way line of the aforesaid
Westheimer Road, from which a 3/4 " iron rod found for the
most northerly northwest corner of said Camden Park at Royal
Oaks, Sec. 3, common to the east corner of Restricted
Reserve "B", Kirkwood Drive, Meadowglen Lane, Royal Oaks
Club Drive and Westpark Drive, according to the plat thereof
recorded under Film Code No. 439077, in the Map Records of
Xxxxxx County, Texas, bears S 87 18' 52" W - 496.39;
THENCE N 87 18' 52" E - 254.63' along the north line of said
Camden Park at Royal Oaks, Sec. 3, common to the south line
of said Westheimer Road, to the POINT OF BEGINNING of the
herein described tract and containing 1.538 acres of land.
