ASSIGNMENT
OF
PURCHASE AGREEMENT
THIS ASSIGNMENT made and entered into this 2 day of
January, 2004, by and between AEI FUND MANAGEMENT, INC., a
Minnesota corporation, ("Assignor") and AEI INCOME & GROWTH
FUND 23 LLC, a Delaware Limited Liability Company, AEI
INCOME & GROWTH FUND 25 LLC, a Delaware Limited Liability
Company, and AEI ACCREDITED INVESTOR FUND 2002 LIMITED
PARTNERSHIP, a Minnesota Limited Partnership (as tenants in
common, together collectively referred to as "Assignee");
WITNESSETH, that:
WHEREAS, on the 24th day of November, 2003, Assignor
entered into a Purchase Agreement ("the Agreement") for that
certain property located at 000 Xxxx 00 Xxxx Xxxx, Xxxxxxx
Xxxxxxx, XX (the "Property") with TransMadison, L.L.C., as
Seller; and
WHEREAS, Assignor desires to assign to AEI Income &
Growth Fund 23, LLC, an undivided forty-eight percent
(48.0%) as a tenant in common; AEI Income & Growth Fund 25
LLC, an undivided twenty-one percent (21.0%) interest as a
tenant in common; and AEI Accredited Investor Fund 2002
Limited Partnership, an undivided thirty-one percent (31.0%)
interest as a tenant in common, of its rights, title and
interest in, to and under the Agreement as hereinafter
provided;
NOW, THEREFORE, for One Dollar ($1.00) and other good
and valuable consideration, receipt of which is hereby
acknowledged, it is hereby agreed between the parties as
follows:
1. Assignor assigns all of its rights, title and
interest in, to and under the Agreement to Assignee, to
have and to hold the same unto the Assignee, its
successors and assigns;
2. Assignee hereby assumes all rights, promises,
covenants, conditions and obligations under the
Agreement to be performed by the Assignor thereunder,
and agrees to be bound for all of the obligations of
Assignor under the Agreement.
All other terms and conditions of the Agreement shall remain
unchanged and continue in full force and effect.
ASSIGNOR:
AEI FUND MANAGEMENT, INC.
By:/s/ Xxxxxx X Xxxxxxx
Xxxxxx X. Xxxxxxx, its President
ASSIGNEE:
AEI INCOME & GROWTH FUND 23 LLC
BY: AEI FUND MANAGEMENT XXI, INC.
By:/s/ Xxxxxx X Xxxxxxx
Xxxxxx X. Xxxxxxx, its President
AEI INCOME & GROWTH FUND 25 LLC
BY: AEI FUND MANAGEMENT XXI, INC.
By:/s/ Xxxxxx X Xxxxxxx
Xxxxxx X. Xxxxxxx, its President
AEI ACCREDITED INVESTOR FUND 2002
LIMITED PARTNERSHIP
BY: AEI FUND MANAGEMENT XVIII, INC.
By:/s/ Xxxxxx X Xxxxxxx
Xxxxxx X. Xxxxxxx, its President
PURCHASE AGREEMENT AND
ESCROW INSTRUCTIONS
THIS PURCHASE AGREEMENT AND ESCROW INSTRUCTIONS (this
"Agreement") is made and entered into effective as of this 24th
day of November, 2003 (the "Effective Date") by and between
TRANSMADISON, LLC, a Nevada limited liability company ("Seller"),
and AEI FUND MANAGEMENT, INC., a Minnesota corporation, or its
successors or assigns (the "Buyer").
RECITALS:
A. Seller is the owner of that certain parcel of real
property located at 000 Xxxx 00 Xxxx Xxxx, Xxxxxxx Xxxxxxx,
Xxxxxxxx 00000, as more particularly described on Exhibit A
attached hereto (the "Land");
B. Constructed on the Land is a retail jewelry store known
as "Jared-The Galleria of Jewelry" (the "Improvements") which is
leased to Sterling Jewelers LLC, a Delaware limited liability
company ("Sterling") pursuant to that certain lease agreement
between Seller and Sterling dated August 27, 2003, and that
certain Guaranty of Lease (the "Guaranty") executed by Sterling
Jewelers Inc., a Delaware corporation ("Guarantor"), a copiesy of
which will be provided to Buyer within three (3) days after the
Effective Date (the "Lease").
C. Seller desires to sell the Land and the Improvements
(collectively, the "Property") to Buyer and Buyer desires to
purchase the Property from Seller upon the terms and conditions
set forth in this Agreement.
TERMS AND CONDITIONS
1. AGREEMENT FOR PURCHASE AND SALE. Seller hereby agrees
to sell the Property to Buyer, and Buyer hereby agrees to
purchase the Property from Seller, in accordance with and subject
to the terms and conditions of this Agreement.
2. PURCHASE PRICE AND PAYMENT.
2.1 PURCHASE PRICE. The purchase price for the
Property will be Four Million Four Hundred Forty Thousand
Dollars ($4,440,000) (the "Purchase Price").
2.2 PAYMENT. The Purchase Price shall be paid as
follows:
(a) DEPOSIT.
(1) DEPOSIT. Buyer will deposit the
amount of Fifty Thousand Dollars ($50,000) into
escrow with First American Title Company of Nevada
("Escrow Holder") as Buyer's deposit (the
"Deposit") within two (2) business day following
the Effective Date.
(2) RELEASE OF DEPOSIT. Upon Buyer's
acceptance or waiver of Buyer's due diligence
contingencies on or before the expiration of the
Due Diligence Period, the Deposit will be non-
refundable to Buyer except in the event of
Seller's default or except as otherwise set forth
herein and Escrow Holder will release the Deposit
to Seller, without any further written
instructions from Buyer or Seller. Buyer and
Seller agree to indemnify and hold Escrow Holder
harmless from and against any loss (including,
without limitation, reasonable attorneys' fees)
arising out of or incurred in connection with the
release of the Deposit to Seller.
(3) CREDIT AGAINST PURCHASE PRICE. The
amount of the Deposit will be applied to the
Purchase Price at the Close of Escrow, but will be
retained by Seller as its liquidated damages as
provided in Section 12.2 if Escrow fails to close
as a result of Buyer's default.
(b) BALANCE DUE AT CLOSE. Not less than one (1)
business day before the Close of Escrow, Buyer will
deposit into escrow in immediately available Federal
Funds an amount equal to the balance of the Purchase
Price plus an amount sufficient to cover all of Buyer's
closing costs.
4. BUYER'S DUE DILIGENCE.
4.1 DUE DILIGENCE PERIOD. The "Due Diligence Period"
shall commence on the Effective Date and expire thirty (30) days
thereafter, except as otherwise set forth herein respecting
matters of adverse change or materially adverse information
("Supplemental Due Diligence") affecting the Reports (as defined
below), which Supplemental Due Diligence if known to Seller shall
be forwarded to Buyer and Buyer shall have a minimum of five (5)
business days thereafter to review the same; the Due Diligence
Period shall be extended, if necessary, to provide Buyer with
such additional review period of five (5) business days after
receipt of such Supplemental Due Diligence. Seller has, prior to
the execution of this Agreement, without warranty as to accuracy
of content, except as otherwise set forth herein, provided Buyer
with complete copies of all studies, reports, agreements,
documents, plans, permits and entitlements in Seller's possession
concerning the Property, including, but not limited to, all
engineering drawings, soils reports, site history investigations,
toxic or hazardous materials investigations or reports, planning
studies, construction warranties, and title reports in Seller's
possession (collectively the "Reports").
4.2 EXPIRATION OF DUE DILIGENCE PERIOD. Buyer shall
approve or disapprove, in writing, Buyer's due diligence on or
before expiration of the Due Diligence Period. If Buyer
disapproves Buyer's due diligence, in writing, on or before
expiration of the Due Diligence Period, this Agreement shall
terminate and Escrow Holder shall deliver to Buyer the Deposit
and thereafter, neither Seller nor Buyer shall have any further
obligation or liability under this Agreement, except for the
Obligations Surviving Termination (as hereinafter defined).
5. DURATION OF ESCROW AND ESCROW INSTRUCTIONS.
5.1 JOINT ESCROW INSTRUCTIONS AND GENERAL CONDITIONS.
This Agreement shall constitute both agreements between Buyer and
Seller and joint escrow instructions to Escrow Holder. Escrow
Holder's general conditions (the "General Conditions") attached
hereto as Exhibit B are incorporated herein by reference to the
extent they are not inconsistent with the provisions of this
Agreement. If there is any inconsistency between the provisions
of the General Conditions and this Agreement, the provisions of
this Agreement shall control. If any provisions of this
Agreement are unacceptable to Escrow Holder, or if Escrow Holder
requires additional instructions, the Parties agree to make any
deletions, substitutions and additions as counsel for the Parties
shall mutually approve and which do not materially alter the
terms of this Agreement.
5.2 CLOSE OF ESCROW.
(a) CLOSING DATE. Unless the Parties agree
upon an earlier closing date, Escrow shall close ten
(10) days after expiration of the Due Diligence Period
(the "Closing Date").
(b) CLOSE OF ESCROW DEFINED. "Close of Escrow"
will have occurred when Escrow Holder records a special
warranty deed (as defined below) transferring the
Property.
6. TITLE EXAMINATION.
6.1 PROCUREMENT OF TITLE COMMITMENT. As soon as
possible after the Effective Date, Seller shall, at its expense,
provide Buyer with a current title commitment covering the
Property (the "Title Commitment") issued by Escrow Holder, naming
Buyer as proposed insured, in the amount of the Purchase Price,
together with legible copies of all documents described in the
Title Commitment.
6.2 TITLE EXCEPTIONS. On or before expiration of the
Due Diligence Period, Buyer may give written notice to Seller of
any objections Buyer may have with respect to any conditions
affecting the Property or as disclosed by the Title Commitment
(the "Title Objections"). If Buyer fails to give any such notice
with respect to any specific matters disclosed in the Title
Commitment on or before expiration of the Due Diligence Period,
then Buyer shall be deemed to have waived any Title Objections
with respect to all such matters as to which no objection is made
and any such matter shall be deemed a "Permitted Exception". Any
title matters arising subsequent to the date of the provided
Title Commitment may be reviewed by Buyer and Buyer shall have at
least five business days to review the same; if necessary, the
Due Diligence Period shall be extended to provide Buyer with at
least five business days to review any such supplemental matters.
Any such extension of the Due Diligence Period shall also extend,
by like number of days, the Response Period and Title Election
Deadline as defined below.
6.3 FAILURE TO CORRECT TITLE OBJECTIONS. Except as
hereinafter expressly provided in this Section 6.3, Seller shall
have no obligation whatsoever to remove, satisfy, or otherwise
cure, or to incur any expense in connection with the curing of
any valid Title Objections of which Seller is notified by Buyer
in accordance with Section 6.2. Seller shall notify Buyer within
ten (10) days after Seller's receipt of written notice from Buyer
of any Title Objections (the "Response Period") whether or not
Seller agrees to take action to cause such Title Objections to be
cured on or before the Closing Date although Seller shall not
otherwise have any obligation to take any action to cure any
Title Objections other than to release liens evidenced by
mortgages, deeds of trust, financing statements, security
interests and similar security instruments created by Seller
(such instruments are collectively referred to herein as the
"Secured Encumbrances"). Buyer acknowledges that a Title
Objection shall be deemed cured if Escrow Holder agrees to issue
its policy of title insurance with respect to the Property to
Buyer without exception to such Title Objection. If Seller
expressly agrees in writing to take action to cure any of such
Title Objections pursuant to Buyer's notice, then Seller shall
have assumed the obligation to take action to cure only such
Title Objections as expressly set forth by Seller, but not other
Title Objections, on or before the Closing Date. If Seller does
not notify Buyer within the Response Period that it has agreed in
writing to take action to cure Buyer's Title Objections, or if
Seller thereafter fails to take any action to cure on or before
the Closing Date any Title Objections made by Buyer pursuant to
Section 6.2 in accordance with Seller's written agreement to
take such action (which Closing Date shall, at Buyer's election,
be extended for up to fifteen (15) additional days), Buyer may,
as its sole remedy, elect by written notice to Seller on or
before fifteen (15) days after the end of the Response Period
(the "Title Election Deadline"), to do one of the following:
6.3.1 To waive any such Title Objection
(thereby making such Title Objection a "Permitted
Exception") and to close the transaction in accordance
with the terms of this Agreement without reduction of
the Purchase Price; or
6.3.2 To terminate this Agreement, and in the
event of such termination, Escrow Holder shall deliver
to Buyer the Deposit and thereafter, neither Seller nor
Buyer shall have any further obligation or liability
under this Agreement except for Seller's
indemnification obligations under Section 11.2 of this
Agreement (as limited by Section 27 of this Agreement)
and Buyer's Indemnity Obligations under Sections 9.2
and 11.2 (collectively, the "Obligations Surviving
Termination").
If Buyer fails to elect either option under this Section 6.3
on or before the Title Election Deadline, Buyer shall be
deemed to have elected to waive such Title Objection(s) and
to close the transaction in accordance with the terms of
this Agreement as provided in Section 6.3.1 hereof.
7. FINANCING CONTINGENCY. [Intentionally Omitted]
8. REPRESENTATIONS.
8.1 SELLER'S REPRESENTATIONS. As an inducement to
Buyer to enter into this Agreement, Seller warrants, covenants
and represents to Buyer, which representations shall be deemed to
be true and correct as of the Closing unless Seller shall have
notified Buyer to the contrary, and which warranties, covenants
and representations shall survive closing for a period of one (1)
year, as follows:
8.1.1 AUTHORITY. Seller is a limited
liability company duly organized, validly existing
and in good standing under the laws of the State
of Nevada and has the right, power, and authority
to enter into this Agreement and the right, power,
and authority to convey the Property in accordance
with the terms and conditions of this Agreement.
8.1.2 ENVIRONMENTAL. To the best of Seller's
Actual Knowledge (as defined below) as of the date
hereof, based on the Phase I Environmental Site
Assessment Report prepared by Soil and Materials
Engineers, Inc. dated July 16, 2003, the
Geotechnical Investigation Report prepared by Soil
and Materials Engineers, Inc. dated July 21, 2003,
and the Asbestos Assessment prepared by Soil and
Materials Engineers, Inc. dated July 15, 2003
(collectively, the "Environmental Report"), and
except as disclosed in the Environmental Report,
no hazardous materials (as described in such
report) are present on the Property at levels that
require removal, remediation or other corrective
action under applicable laws, ordinances, rules
and regulations in effect and applicable to the
Property on such date. For purposes of this
Agreement, "Seller's Actual Knowledge" shall mean
the actual (as opposed to constructive) knowledge
of Xxx Xxxxxxxx, Xxxx Xxxxxxxxx, Xxxx Xxxxxxxx or
Xxxxx Xxxxxxx. Seller represents that such
individuals are privy to and hold such position
within Seller as to be familiar with the factual
circumstances, if the same might exist, for which
knowledge may be imputed under commercially
reasonable circumstances, upon such matters as
Seller may represent to its actual knowledge in
this Agreement.
8.1.3. PROPERTY AND STERLING MATTERS. To
Seller's Actual Knowledge, the Property is not
under threat of condemnation of eminent domain, is
in substantially good repair and working order,
all real estate taxes are current, and Sterling
has obtained all licenses, permits and
certificates of occupancy necessary to conduct its
business on the Property. To Seller's Actual
Knowledge, Sterling has not declared Seller in
default under any term or provision of the Lease
relating to Landlord's work or construction
responsibilities, matters of zoning, title, or
environmental concern, or any other matter, nor to
the Seller's Actual Knowledge, has any event
occurred that, with the passing of time, would
constitute a default by Seller under the Lease,
nor is Sterling in material default under the
Lease. Furthermore, Guarantor has not declared
Seller in default under any term or provision of
the Lease relating to Landlord's work or
construction responsibilities, matters of zoning,
title, or environmental concern, or any other
matter, nor to the Seller's Actual Knowledge, has
any event occurred that, with the passing of time,
would constitute a default by Seller under the
Guaranty of nor is Guarantor in material default
under the Guaranty.
8.2 BUYER'S REPRESENTATIONS. As an inducement to
Seller to enter into this Agreement, Buyer warrants and
represents to Seller that AEI Fund Management, Inc. is a
corporation duly organized, validly existing and in good standing
under the laws of the State of Minnesota and has the right,
power, and authority to enter into this Agreement and the right,
power, and authority to purchase the Property in accordance with
the terms and conditions of this Agreement. Buyer further
acknowledges, represents and warrants to Seller that Buyer has
the knowledge and experience in financial and business matters to
enable Buyer to evaluate the merits and risks of the transaction
contemplated by this Agreement, and that Buyer is not in a
disparate bargaining position relative to Seller with respect to
this Agreement.
8.3 NO FURTHER REPRESENTATIONS OR WARRANTIES. Buyer
agrees that Buyer's election not to terminate this Agreement
pursuant to Section 9.4 below shall constitute a representation
by Buyer to Seller that Buyer has fully inspected the Property
and agrees to purchase the Property wholly "as is, where is, with
all faults", subject to Seller's representations in Sections 8.1
and 11.2 hereof. Buyer acknowledges that Seller has made no
warranties or representations whatsoever pertaining to the
Property, the condition thereof, the value thereof, or any other
matter with respect to the Property that will survive the
Closing, other than as may be contained in the documents to be
delivered at Closing as provided in Section 10.1.1, the brokerage
representation and indemnity set forth in Section 11.2, and the
representations set forth in Section 8.1 above.
9. INSPECTIONS.
9.1 ACCESS. From the Effective Date through and
including expiration of the Due Diligence Period, Buyer and its
agents, shall have the right to enter upon the Property to
inspect, examine, and study the physical integrity of the
Property, which, in the opinion of Buyer, are necessary to
determine the physical condition of the Property. Seller hereby
agrees to cooperate with Buyer and its agents, in connection with
such inspections.
9.2 INSURANCE AND INDEMNIFICATION. Buyer agrees that,
in making any inspections of the Property, Buyer or Buyer's
agents will (i) carry not less than One Million Dollars
($1,000,000.00) commercial general liability insurance with
contractual liability endorsement naming Seller as an additional
insured thereunder and insuring Buyer's Indemnity Obligations (as
hereinafter defined) and, prior to the entering upon the Property
to make such inspection, will provide Seller with written
evidence of same, (ii) will not reveal to any third party not
approved by Seller (other than Buyer's agents, employees,
contractors, design professionals, and lenders) the results of
its inspections, and (iii) will restore promptly any physical
damage caused by the inspections. Buyer shall give Seller
reasonable prior notice of its intention to conduct any
inspections, and Seller reserves the right to have a
representative present at such inspections. Buyer agrees to
provide Seller with a copy of any inspection report upon Seller's
written request. Buyer agrees to indemnify, defend, and hold
Seller free and harmless from any loss, injury, damage, claim,
lien, allegation, cost or expense, including attorneys' fees,
arising out of a breach of the foregoing agreements by Buyer in
connection with the inspection of the Property, or otherwise from
the exercise by Buyer or its agents or representatives of the
right of access under Section 9.1 (collectively, the "Buyer's
Indemnity Obligations"). Any inspections shall be at Buyer's
sole cost and expense. The provisions of this Section 9.2 shall
survive Closing.
9.3 REPORTS. Within five (5) business days after the
Effective Date, Seller will provide, if not previously provided,
to Buyer all of the following (but only as such may be in the
Seller's or Seller's agents' or representatives' possession or
control or are otherwise readily obtainable):
9.3.1 A preliminary title commitment and
copies of all underlying documents covering the
Property as set forth in Section 6 above, and in
addition, including an ALTA survey of the
Property;
9.3.2 All existing contracts, construction
warranties, or other agreements affecting the
Property that shall survive Closing;
9.3.3 Copies of the Environmental Report with
respect to the Property.
Seller makes no representations or warranties as to the
truth, accuracy or completeness of any materials, data or other
information supplied to Buyer in connection with Buyer's
inspection of the Property (e.g., that such materials are
complete, accurate or the final version thereof, or that all such
materials are in Seller's possession). To Seller's Actual
Knowledge, such materials are not inaccurate. It is the parties'
express understanding and agreement that such materials are
provided only for Buyer's convenience in making its own
examination of the Property, and, in doing so, Buyer shall rely
exclusively on its own independent investigation and evaluation
of every aspect of the Property and not on any materials supplied
by Seller. Buyer expressly disclaims any intent to rely on any
such materials provided to it by Seller in connection with its
inspection, except to the extent otherwise represented, warranted
and covenanted herein by Seller, and agrees that it shall rely
solely on its own independently developed or verified
information.
9.4 RIGHT TO TERMINATE. If, in the sole and absolute
opinion of Buyer, the Property is not suitable or acceptable to
Buyer for any reason or no reason, Buyer shall have the right at
any time prior to 5:00 p.m. Pacific Time on the date which the
Due Diligence Period expires, to terminate this Agreement by
sending written notice of termination to Seller. In the event of
termination pursuant to this Section 9.4, Escrow Holder shall,
within two (2) business days after such written notice of
termination, return the Deposit to Buyer, less one-half of the
Escrow Holder's cancellation fees, and thereafter, neither Seller
nor Buyer shall have any further obligation or liability under
this Agreement except for Obligations Surviving Termination. If
Buyer does not elect to terminate this Agreement as provided in
this Section 9.4, Buyer shall be deemed to have waived its right
to terminate this Agreement under this Section 9.4, and the
Deposit shall be fully earned by Seller and non-refundable to
Buyer, except as otherwise expressly provided in this Agreement.
10. THE CLOSING.
10.1 DELIVERIES AT CLOSING. The Closing shall occur as
follows, subject to satisfaction of all of the terms and
conditions of this Agreement:
10.1.1 Seller shall convey its interest in and
to the Property to Buyer by depositing into Escrow
a special warranty deed (the "Deed"), which Deed
shall convey fee simple title to the Property to
Buyer, subject to the Permitted Exceptions. The
Deed shall be expressly accepted by and binding
upon Buyer, its successors and assigns and the
Property from and after the Closing Date.
10.1.1.1 Such assignment, documents and
other instruments and agreements, executed,
witnessed and acknowledged in recordable
form, as shall be reasonably required by
Escrow Holder to release of record the
Property from the Secured Encumbrances and
all Title Objections which Seller has agreed
to remove in accordance with the provisions
of Section 6 above;
10.1.1.2 Such other documents, instruments,
and agreements as are customarily executed
and delivered at closing by sellers of real
property in Oakland County, Michigan,
including but not limited to a standard
Seller's affidavit respecting mechanic's
liens, and a FIRPTA Affidavit.
10.1.1.3 An Assignment and Assumption of
Lease and the Guaranty document providing,
inter alia, that Seller has good and
indefeasible title to the Lease free and
clear of all liens and encumbrances except
the Permitted Exceptions, and a mutual
indemnification of Buyer and Seller,
respectively, for lessor obligations under
the Lease, pre and post closing,
respectively. The form of said Assignment
and Assumption Agreement shall be negotiated
in good faith between the parties during the
Due Diligence Period, and failure to agree on
the form of the same shall be grounds for
either party to terminate this Agreement.
10.1.1.4 An estoppel from Sterling and
Guarantor in the form attached hereto as
Exhibit C, dated no more than ten (10) days
prior to the closing.
10.2 CLOSING COSTS. Seller and Buyer shall
respectively pay the following costs and expenses:
10.2.1 Seller shall pay (i) the fees and
expenses of Seller's attorneys, (ii) the transfer
tax due with respect to the Deed by which the
Property is conveyed to Buyer, (iii) such
recording fees and filing fees for all recordable
instruments necessary to clear title to the
Property of any Secured Encumbrances and any other
Title Objections that Seller has agreed to remove,
(iv) one-half of any escrow fees charged by Escrow
Holder, (v) prorated taxes and assessments and
other charges as may be applicable to the
Property; (vi) the cost of providing a standard
ATA Owner's Policy of Title Insurance to Buyer,
(vii) real estate commissions payable to Brokers,
as set forth in Section 11.1 of this Agreement,
and (viii) any other amounts sufficient to cover
costs which are customarily borne by sellers of
real property in the Oakland County, Michigan.
10.2.2 Buyer shall pay (i) the fees and
expenses of Buyer's attorneys, (ii) the cost of
recording the Deed, (iii) any other charges
relating to Buyer's inspection of the Property,
(iv) one-half of any escrow fees charged by Escrow
Holder, (v) prorated taxes and assessments and
other charges as may be applicable to the
Property, except to the extent payable by
Sterling; (vi) real estate commissions payable to
Brokers, as set forth in Section 10.1 of this
Agreement, and (vii) any other amounts sufficient
to cover costs which are customarily borne by
buyers of real property in Oakland County,
Michigan.
11. REAL ESTATE BROKERS.
11.1 COMMISSION. Seller shall pay at Closing real
estate commissions in the total amount of three and one-half
percent (3.5%) of the Purchase Price paid to Marcus &
Millichap (the "Seller's Broker")
11.2 REPRESENTATIONS AND INDEMNITY REGARDING BROKERS.
Except as specifically set forth in Section 11.1, Seller and
Buyer each represent and warrant to the other that neither
has employed, retained, or consulted any broker, agent, or
finder in carrying on the negotiations in connection with
this Agreement or the purchase and sale referred to herein.
Seller hereby indemnifies Buyer and agrees to hold Buyer
harmless from and against any and all claims (and all
expenses, including attorneys' fees incurred in defending
any such claim or in enforcing this indemnity) for real
estate commissions (including, without limitation, the said
commission payable by Seller to Broker) or similar fees if
such claims are made by an agent or broker claiming to have
dealt with Seller. Buyer hereby indemnifies Seller and
agrees to hold Seller harmless from and against any and all
claims (and all expenses, including attorneys' fees incurred
in defending any such claim or in enforcing this indemnity)
for real estate commissions or similar fees if such claims
are made by an agent or broker claiming to have dealt with
Buyer. The indemnities contained in this Section 11.2 shall
survive the Closing or any termination of this Agreement.
11.3 FAILURE TO CLOSE. Neither Seller nor Buyer shall
have any liability to Brokers in the event the sale of the
Property should fail to close for any reason whatsoever,
including, without limitation, a default by Seller or Buyer.
12. DEFAULT.
12.1 SELLER'S DEFAULT. If the sale and purchase of the
Property contemplated by this Agreement is not consummated
on account of Seller's default, then Buyer shall be
entitled, as Buyer's sole and exclusive remedies, (i) to
terminate this Agreement, receive the Deposit and receive
reimbursement of Buyer's due diligence costs up to the date
of Seller's breach or (ii) to seek specific performance of
this Agreement against Seller. Notwithstanding anything in
this Section 12.1 to the contrary, in the event of any
default by Seller hereunder other than in Seller's
obligations to sell the Property, there shall be no
limitation on remedy with respect to such default, and Buyer
shall have all of its rights and remedies available at law
or in equity with respect to such default.
12.2 BUYER'S DEFAULT. If the sale and purchase of the
Property as contemplated by this Agreement is not
consummated because of Buyer's default, then Seller shall be
entitled, as Seller's sole and exclusive remedy with respect
thereto, to unilaterally direct Escrow Holder in writing
(with a copy to Buyer), to pay the Deposit to Seller as full
liquidated damages for such default of Buyer. Buyer and
Seller agree to indemnify and hold Escrow Holder harmless
from and against any loss (including, without limitation,
attorneys' fees) arising out of or incurred in connection
with the release of the Deposit to Seller. The parties
hereto expressly acknowledge that it is impossible to
estimate more precisely the damages to be suffered by Seller
upon Buyer's default in its obligation to purchase the
Property, and that retention of the Deposit is intended not
as a penalty, but as full liquidated damages. The parties
further acknowledge that the amount of the Deposit is a
reasonable estimate by the parties of the amount of probable
loss that Seller should be expected to suffer in the event
the sale and purchase of the Property is not closed because
of Buyer's default. Seller's right to retain the Deposit as
full liquidated damages is Seller's sole and exclusive
remedy in the event of default hereunder by Buyer with
respect to its obligation to purchase the Property, and
Seller hereby waives and releases any right to (and hereby
covenants that it shall not) xxx Buyer (i) for specific
performance of this Agreement or (ii) to prove that Seller's
actual damages resulting from such default exceed the
Deposit which is hereby provided Seller as full liquidated
damages. In the event the purchase and sale contemplated in
this Agreement is not consummated because of Buyer's
default, Buyer hereby waives and releases any right to xxx
(and hereby covenants that it shall not xxx) Seller or
Escrow Holder to recover the Deposit or any part thereof on
the grounds that it is unreasonable in amount or that its
retention by Seller is a penalty and not agreed upon and
reasonable liquidated damages. Notwithstanding anything in
this Section 12.2 to the contrary, in the event of any
default by Buyer hereunder other than in Buyer's obligations
to purchase the Property, there shall be no liquidated
damages with respect to such default, and Seller shall have
all of its rights and remedies available at law or in equity
with respect to such default.
13. NO RECORDING. The parties acknowledge that this
Agreement is not in recordable form and agree not to record this
Agreement.
14. DATE OF PERFORMANCE. If the time period or date by
which any right, option, or election provided under this
Agreement must be exercised, or by which any act required
hereunder must be performed, or by which the Closing must be
held, expires or occurs on a Saturday, Sunday, or legal or bank
holiday, then such time period or date shall be automatically
extended through the close of business on the next regularly
scheduled business day.
15. GOVERNING LAW. This Agreement shall be construed,
interpreted, and enforced in accordance with the internal laws of
the State of Michigan, without regard to the principles of
conflicts of law.
16. NOTICES. Any notices, requests, or other
communications required or permitted to be given hereunder shall
be in writing and shall be delivered by hand or courier without
limitations (including an overnight courier service such as
FedEx) or mailed by United States certified mail, return receipt
requested, postage prepaid and addressed to each party at the
address set forth below, or transmitted by facsimile to the
facsimile number set forth below with confirmed receipt and hard
copy sent within three (3) days thereof by one of the other
approved methods of delivery. Any such notice, request, or other
communication shall be considered given, delivered or received,
as the case may be, on the date of hand or courier delivery or
facsimile transmission or on the third (3rd) day following
deposit in the United States mail as provided above. Rejection
or other refusal to accept or inability to deliver because of
changed address of which no notice was given shall be deemed to
be receipt of the notice, request, or other communication. By
giving at least five (5) days' prior written notice thereof, any
party may from time to time and at any time change its mailing
address or facsimile number hereunder.
To Seller: TransMadison, LLC
0000 Xxxx Xxx Xxxxx Xxxxxxx
Xxxxxxxxx, Xxxxxx 00000
Attention: Xxxx X. Xxxxxxxx, Xx.
Fax: (000) 000-0000
with a copy to: TransMadison, LLC
0000 Xxxx Xxx Xxxxx Xxxxxxx
Xxxxxxxxx, Xxxxxx 00000
Attention: General Counsel
Fax: (000) 000-0000
To Buyer: AEI Fund Management, Inc.
0000 Xxxxx Xxxxx Xxxxx
00 Xxxxxxx Xxxxxx Xxxx
Xx. Xxxx, Xxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxx
Fax (000) 000-0000
with a copy to: Xxxxxxx X. Xxxxxxxxxx, Esq.
0000 Xxxxx Xxxxx Xxxxx
00 Xxxxxxx Xxxxxx Xxxx
Xx. Xxxx, Xxxxxxxxx 00000
Fax (000) 000-0000
Phone (000) 000-0000
To Escrow Holder: First American Title Company of
Nevada
000 Xx. Xxxxxxxx Xxxxxx Xxxxx, #000
Xxx Xxxxx, Xxxxxx 00000
Attention: Xxxxxx Xxxxxxxxxx
Fax: (000) 000-0000
Phone: (000) 000-0000
17. ENTIRE AGREEMENT; MODIFICATION. This Agreement
supersedes all prior discussions and agreements between Seller
and Buyer with respect to the Property and contains the sole and
entire understanding between Seller and Buyer with respect
thereto. All promises, inducements, offers, letters of intent,
solicitations, agreements, commitments, representation, and
warranties heretofore made between such parties with respect to
the Property are merged into this Agreement. This Agreement
shall not be modified or amended in any respect except by a
written instrument executed by or on behalf of each of Buyer and
Seller.
18. SURVIVAL OF COVENANTS. All covenants, representations,
warranties, obligations and agreements contained in this
Agreement shall survive the Close of Escrow and the delivery and
recordation of all documents or instruments in connection
therewith. Notwithstanding the foregoing, however, a Party's
obligation to perform a certain act or take a certain action as
required hereunder shall cease upon that Party's timely and
proper performance thereof.
19. EXHIBITS. Each and every exhibit referred to or
otherwise mentioned in this Agreement is attached to this
Agreement and shall be construed to be made a part of this
Agreement by such reference or other mention at each point at
which such reference or other mention occurs, in the same manner
and with the same effect as if each exhibit were set forth in
full and at length every time it is referred to or otherwise
mentioned.
20. CAPTIONS. All captions, headings, section and
subsection numbers and letters, and other reference numbers or
letters are solely for the purpose of convenience and shall not
be deemed to supplement or limit the subject of such Sections or
to be considered in their construction.
21. COUNTERPARTS. This Agreement may be executed in
multiple counterparts, each of which shall constitute an original
and all of which when taken together shall constitute one and the
same instrument.
22. WAIVER. Any condition or right of termination,
cancellation, or rescission granted by this Agreement to Buyer or
Seller may be waived by such party; provided, however, that no
waiver shall be binding on a party hereto unless made expressly
and in writing.
23. RIGHTS CUMULATIVE. Except as expressly limited by the
terms of this Agreement, all rights, powers, and privileges
conferred hereunder shall be cumulative and not restrictive of
those given by law.
24. SUCCESSORS AND ASSIGNS. This Agreement shall be
binding upon and inure of the benefit of the parties hereto and
their respective heirs, successors, and assigns.
25. ASSIGNMENT. Without the prior written consent of
Seller, Buyer shall not assign, mortgage, pledge, or in any other
way encumber or transfer any of Buyer's rights hereunder or any
part thereof to any person, firm, partnership, corporation, or
other entity by operation of law or otherwise; provided, however,
Buyer may assign its rights hereunder to any person, corporation,
partnership, limited liability company, or other entity, if the
same controls Buyer, is controlled by Buyer or is under common
control with Buyer. In the event of such permitted assignment,
Buyer shall remain liable for Buyer's obligations under this
Agreement.
26. TIME OF ESSENCE. Time is of the essence in the
performance of each provision of this Agreement.
27. LIMITATION OF LIABILITY. Buyer (on behalf of itself,
its direct and indirect partners, all persons or entities
controlling, controlled by, or under common control with Buyer,
and all officers, directors, employees, trustees, advisors,
agents, shareholders, or contractors of any of the foregoing)
agrees and acknowledges that the obligations of Seller under this
Agreement do not constitute personal obligations of Seller, the
direct or indirect partners of Seller or the members of Seller or
their respective officers, directors, trustees, advisors,
members, agents, shareholders, employees, or contractors, and
that Buyer agrees that it will look solely to the interest of
Seller in the Property and the proceeds thereof (including,
without limitation, the Purchase Price) for satisfaction of any
liability of Seller with respect to this Agreement, and will not
seek recourse against any other assets of Seller, or the members
of Seller, or their respective officers, directors, trustees,
advisors, members, agents, shareholders, employees or
contractors, or any of their personal assets, for such
satisfaction. In addition, the obligations of the members of
Seller to make capital contributions to Seller shall not
constitute assets of Seller against which recourse may be sought
for purposes hereof.
Seller (on behalf of itself, its direct and indirect
partners, all persons or entities controlling, controlled by, or
under common control with Seller, and all officers, directors,
employees, trustees, advisors, agents, shareholders, or
contractors of any of the foregoing) agrees and acknowledges that
the obligations of Buyer under this Agreement do not constitute
personal obligations of the direct or indirect partners of Buyer
or the members of Buyer or their respective officers, directors,
trustees, advisors, members, agents, shareholders, employees, or
contractors, and that Seller agrees that it will look solely to
the interest of Buyer in the Property and the proceeds thereof
and Buyer's assets for satisfaction of any liability of Buyer
with respect to this Agreement, and will not seek recourse
against any members of Buyer, or their respective officers,
directors, trustees, advisors, members, agents, shareholders,
employees or contractors, or any of their personal assets, for
such satisfaction. In addition, the obligations of the members of
Buyer to make capital contributions to Buyer shall not constitute
assets of Buyer against which recourse may be sought for purposes
hereof. The provisions of this Section 27 shall survive Closing.
28. SEVERABILITY. If any portion of this Agreement becomes
illegal, null, void or against public policy, for any reason, or
is held by any court of competent jurisdiction to be illegal,
null, void or against public policy, the remaining portions of
this Agreement shall not be affected thereby and shall remain in
effect to the fullest extent permitted by law.
29. INTERPRETATION. No provision of this Agreement shall
be construed against or interpreted to the disadvantage of any
party hereto by any court or other governmental or judicial
authority by reason of such party having or being deemed to have
structured, drafted or dictated such provision.
30. ATTORNEY'S FEES. If Seller or Buyer shall engage an
attorney in connection with any action or proceeding to enforce
this Agreement, the prevailing party in such action or proceeding
shall be entitled to recover its court costs including reasonable
attorneys' fees, to the extent permitted by law. If different
parties are the prevailing parties on different issues, the
respective court costs and related attorneys' fees shall be
apportioned in proportion to the value of the issues decided for
or against the parties.
31. SECTION 1031 EXCHANGE. Seller agrees that it will
cooperate, without cost or expense to Seller, with Buyer in
effectuating an Internal Revenue Service Section 1031 Exchange
with this Property, provided (a) Seller will not be required to
take title to any exchange property and (b) the exchange does not
delay Closing.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, the parties hereto have duly signed,
sealed and delivered this Agreement as of the date first written
above.
SELLER:
TRANSMADISON, LLC,
a Nevada limited liability company
By: TransMadison Management
Corporation,
a Nevada corporation, its Managing
Member
By: /s/ Xxxxx X Xxxxxxxx
Name: Xxxxx X Xxxxxxxx
Title: Treasurer
Date of Execution:November 24, 2003
BUYER:
AEI FUND MANAGEMENT, INC.,
a Minnesota corporation
By: /s/ Xxxxxx X Xxxxxxx
Name: Xxxxxx X Xxxxxxx
Title: President
Date of Execution: November 21, 2003
CONSENT OF ESCROW HOLDER
Escrow Holder hereby agrees to be bound by and perform its
duties in accordance with the foregoing instructions.
FIRST AMERICAN TITLE
COMPANY OF NEVADA
Date: December 1, 2003 By: /s/ Xxxxxx Xxxxxxxxxx
Name: Xxxxxx Xxxxxxxxxx
Title: Commercial Escrow Officer
EXHIBIT A
Legal Description of Property
Land in the City of Madison Heights, Oakland County, Michigan
Lots 1, 2, 3, 4 and 5 except the Northerly 15 feet thereof, and
one-half vacated alley adjoining said Lots, and Lots 264, 265,
266, 267, 268, 269, 270 and 271 and half vacated alley adjoining
Lot 271, XXXX X. XXXXXXX SUBDIVISION, of the Northeast one-
quarter of the Northeast one-quarter of Section 2, Town 1 North,
Range 11 East, according to the plat thereof as recorded in Liber
35, Page 13 of Plats, Oakland County Records.
