PROPERTY CO-TENANCY
OWNERSHIP AGREEMENT
(Children's World-Golden, Colorado)
THIS CO-TENANCY AGREEMENT,
Made and entered into as of the 12th day of March, 2001, by and
between Xxxxx X. Xxx and xxxx X. Xxx AKA Xxxx Xxxxxxxx Xxx,
married as joint tenants (hereinafter called "Rea"), and AEI
Income & Growth Fund XXII Limited Partnership (hereinafter called
"Co-Tenancy Manager") (Rea, Co-Tenancy Manager (and any other
Owner in Fee where the context so indicates) being hereinafter
sometimes collectively called "Co-Tenants" and referred to in the
neuter gender).
WITNESSETH:
WHEREAS, Fund XXII presently owns an undivided 29.2153% interest
in and to, and AEI Private Net Lease Fund 1998 Limited
Partnership presently owns an undivided 42.000% interest in and
to, and AEI Private Net Lease Millennium Fund Limited
Partnership presently owns an undivided 18.000% interest in and
to, and Rea presently owns an undivided 10.7847 % interest in and
to, and the land, situated in the City of Golden, County of
Jefferson, and State of Colorado, (legally described upon Exhibit
A attached hereto and hereby made a part hereof) and in and to
the improvements located thereon (hereinafter called "Premises");
WHEREAS, The parties hereto wish to provide for: the orderly
monitoring of performance by the present tenant of the Premises
under the triple net lease agreement for the Premises; if
necessary, upon a vacancy in the Premises, the operation and
management of the Premises; the continued leasing of space within
the Premises; and, the distribution of income from and the pro-
rata sharing in expenses of the Premises by Co-Tenancy Manager in
connection with Rea's interest in the Premises.
NOW THEREFORE, in consideration of the purchase by Rea of an
undivided interest in and to the Premises, for at least One
Dollar ($1.00) and other good and valuable consideration by the
parties hereto to one another in hand paid, the receipt and
sufficiency of which are hereby acknowledged, and of the mutual
covenants and agreements herein contained, it is hereby agreed by
and between the parties hereto, as follows:
1. Rea, subject to the limitations and power of revocation
herein expressed, hereby designates Co-Tenancy Manager as its
sole and exclusive agent and delegates to Co-Tenancy Manager the
sole right to monitor and enforce on behalf of Fund XXII the
terms of the present lease of the Premises, including but not
limited to any amendments, consents to assignment, sublet,
releases or modifications to the lease or guarantees of lease and
to deal with any property agent or tenant. Should the Premises
Co-Tenant Initial: /s/ JDR /s/ MMR
Co-Tenancy Agreement for Children's World Learning Center-Golden, Colorado
become vacant, the operation and management of the Premises, is
delegated by the Co-Tenants, subject to revocation on an
individual basis by an individual Co-Tenant as otherwise set
forth herein, to Co-Tenancy Manager, or its designated agent,
successors or assigns. Provided, however, if Co-Tenancy Manager
shall sell all of its interest in the Premises, (or shall no
longer be delegated the operation and management of the
Premises), the duties and obligations of Co-Tenancy Manager
respecting management of the Premises as set forth herein,
including but not limited to its duties and obligations
respecting paragraphs 2, 3, and 4 hereof, shall be exercised by
the holder or holders of a majority undivided co-tenancy
interests in the Premises. Subject to the approval of all Co-
Tenants evidenced by their written consent, Co-Tenancy Manager
shall negotiate and execute re-leases of the Premises upon
termination of the present lease of the Premises or negotiate and
execute easements affecting the Premises, may incur ordinary and
necessary operating expenses in connection with the management of
the Premises, and propose extraordinary or capital expenditures
to the Premises. Until Rea shall revoke such authority as
provided herein, Co-Tenancy Manager or Rea itself may obligate
Rea with respect to any ordinary and necessary operating expense
for the Premises. However, Co-Tenancy Manager has no right to
obtain a loan for which any other Co-Tenant would be liable, nor
may Co-Tenancy Manager finance or refinance the Premises by
secured by any lien or any pledge of the Premises. Rea agrees to
execute and deliver to Co-Tenancy Manager such written approval
of documents approved by Rea, such approval to take such form as
may be reasonably required by Co-Tenancy Manager to evidence its
authority to sign approved documents on behalf of Rea.
As further set forth in paragraph 2 hereof, Co-Tenancy Manager
agrees to require any lessee of the Premises to name Rea as an
insured or additional insured in all insurance policies provided
for, or contemplated by, any lease on the Premises. Co-Tenancy
Manager shall use its best efforts to obtain endorsements adding
Co-Tenants to said policies from lessee within 30 days of
commencement of this agreement. In any event, Co-Tenancy Manager
shall distribute any insurance proceeds it may receive, to the
extent consistent with any lease on the Premises, to the Co-
Tenants in proportion to their respective ownership of the
Premises.
2. Income and expenses shall be allocated among the Co-Tenants
in proportion to their respective share(s) of ownership. Shares
of net income shall be pro-rated for any partial calendar years
included within the term of this Agreement. Co-Tenancy Manager
may offset against, pay to itself and deduct from any payment due
to Co-Tenancy Manager under this Agreement, and may pay to itself
the amount of Rea's share of any reasonable expenses of the
Premises which are not paid by Rea to Co-Tenancy Manager or its
assigns, within ten (10) days after demand by Rea. In the event
there is insufficient operating income from which to deduct Rea's
unpaid share of operating expenses, Co-Tenancy Manager may pursue
any and all legal remedies for collection.
Operating Expenses shall include all normal operating expense,
including but not limited to: maintenance, utilities, supplies,
labor, management, advertising and promotional expenses, salaries
and wages of rental and management personnel, leasing commissions
to third parties, a monthly accrual to pay insurance premiums,
real estate taxes, installments of special assessments and for
structural repairs and replacements, management fees, legal fees
and accounting fees, but excluding all operating expenses paid by
Co-Tenant Initial: /s/ JDR /s/ MMR
Co-Tenancy Agreement for Children's World Learning Center-Golden, Colorado
tenant under terms of any lease agreement of the Premises.
Rea has no requirement to, but has, nonetheless elected to
retain, and agrees to annually compensate, Co-Tenancy Manager in
the amount of $ 626.00 for the expenses, direct and indirect,
incurred by Co-Tenancy Manager in providing Rea with quarterly
accounting and distributions of Rea's share of net income and for
tracking, reporting and assessing the calculation of Rea's share
of operating expenses incurred from the Premises. This invoice
amount shall be pro-rated for partial years and Rea authorizes Co-
Tenancy Manager to deduct such amount from Rea's share of revenue
from the Premises. Rea may terminate this agreement in this
paragraph respecting accounting and distributions at any time and
attempt to collect its share of rental income directly from the
tenant; Co-Tenancy Manager may terminate its obligation under
this paragraph upon 30 days written notice to Rea prior to the
end of each anniversary hereof, unless agreed in writing to the
contrary.
3. Full, accurate and complete books of account shall be kept
in accordance with generally accepted accounting principles at Co-
Tenancy Manager 's principal office, and each Co-Tenant shall
have access to such books and may inspect and copy any part
thereof during normal business hours. Within ninety (90) days
after the end of each calendar year during the term hereof, Co-
Tenancy Manager shall prepare an accurate income statement for
the ownership of the Premises for said calendar year and shall
furnish copies of the same to all Co-Tenants. Quarterly, as its
share, Rea shall be entitled to receive 10.7847% of all items of
income and expense generated by the Premises. Upon receipt of
said accounting, if the payments received by each Co-Tenant
pursuant to this Paragraph 3 do not equal, in the aggregate, the
amounts which each are entitled to receive proportional to its
share of ownership with respect to said calendar year pursuant to
Paragraph 2 hereof, an appropriate adjustment shall be made so
that each Co-Tenant receives the amount to which it is entitled.
4. If Net Income from the Premises is less than $0.00 (i.e.,
the Premises operates at a loss), or if capital improvements,
repairs, and/or replacements, for which adequate reserves do not
exist, need to be made to the Premises, the Co-Tenants, upon
receipt of a written request therefore from Co-Tenancy Manager
shall, within fifteen (15) business days after receipt of notice,
make payment to Co-Tenancy Manager sufficient to pay said net
operating losses and to provide necessary operating capital for
the premises and to pay for said capital improvements, repairs
and/or replacements, all in proportion to their undivided
interests in and to the Premises. All Co-Tenants shall have the
right to review all contracts that will have a material effect on
the Premises. All Co-Tenants shall have the right to approve
budgets and major capital expenditures affecting the Premises.
While Co-Tenancy Manager shall own an interest in the Premises,
Co-Tenants agree to delegate the determination of such budgets
and need for capital expenditures to Co-Tenancy Manager subject
to the power of any Co-Tenant to revoke such delegation in
accordance with the provisions hereof.
5. Co-Tenants may, at any time, sell, finance, or otherwise
create a lien upon their interest in the Premises but only upon
their interest and not upon any part of the interest held, or
owned, by any other Co-Tenant, and shall not create any lien upon
their individual interest if by operation of law such lien shall
Co-Tenant Initial: /s/ JDR /s/ MMR
Co-Tenancy Agreement for Children's World Learning Center-Golden, Colorado
by law extend to the interest of any other Co-Tenant. All Co-
Tenants reserve the right to escrow proceeds from a sale of their
interests in the Premises to obtain tax deferral by the purchase
of replacement property.
6. If any Co-Tenant shall be in default with respect to any of
its obligations hereunder, and if said default is not corrected
within thirty (30) days after receipt by said defaulting Co-
Tenant of written notice of said default, or within a reasonable
period if said default does not consist solely of a failure to
pay money, the remaining Co-Tenant(s) may resort to any available
remedy to cure said default at law, in equity, or by statute.
7. This Co-Tenancy agreement shall continue in full force and
effect and shall bind and inure to the benefit of the Co-Tenant
and their respective heirs, executors, administrators, personal
representatives, successors and permitted assigns until September
28, 2015 or upon the sale of the entire Premises in accordance
with the terms hereof and proper disbursement of the proceeds
thereof, whichever shall first occur. Unless specifically
identified as a personal contract right or obligation herein,
this agreement shall run with any interest in the Property and
with the title thereto. Once any person, party or entity has
ceased to have an interest in fee in any portion of the Entire
Property, it shall not be bound by, subject to or benefit from
the terms hereof; but its heirs, executors, administrators,
personal representatives, successors or assigns, as the case may
be, shall be substituted for it hereunder. Any Co-Tenant may,
at any time effective upon written notice to Co-Tenancy Manager
revoke the designation of Co-Tenancy Manager as such Co-Tenant's
agent for the purposes as set forth herein. Any Co-Tenant
revoking such designation of Co-Tenancy Manager's agency shall
notify Co-Tenancy Manager in writing in accordance with the terms
hereof and such revocation shall be effective upon Co-Tenancy
Manager's receipt of such written revocation.
8. Any notice or election required or permitted to be given or
served by any party hereto to, or upon any other, shall be given
to all known Co-Tenants and deemed given or served in accordance
with the provisions of this Agreement, if said notice or
elections addressed as follows;
If to Fund XXII:
AEI Income & Growth Fund XXII Limited Partnership,
AEI Private Net Lease Fund 1998 Limited Partnership,
AEI Private Net Lease Millennium Fund Limited Partnership
00 Xxxxxxx Xxxxxx Xxxx, Xxxxx 0000
Xx. Xxxx, XX 00000-0000
If to Rea:
Xxxxx X. Xxx and Xxxx X. Xxx
AKA Xxxx Xxxxxxxx
00000 X Xxxx Xx
Xxxxxxxxxx, XX 00000
Co-Tenant Initial: /s/ JDR /s/ MMR
Co-Tenancy Agreement for Children's World Learning Center-Golden, Colorado
Each mailed notice or election shall be deemed to have been given
to, or served upon, the party to which addressed on the date the
same is deposited in the United States certified mail, return
receipt requested, postage prepaid, or given to a nationally
recognized courier service guaranteeing overnight delivery as
properly addressed in the manner above provided. Any party hereto
may change its address for the service of notice hereunder by
delivering written notice of said change to the other parties
hereunder, in the manner above specified, at least ten (10) days
prior to the effective date of said change. Any Co-Tenant
selling or transferring all or a portion of its interest in the
Premises shall provide, within a reasonable time after the
completion of such sale or transfer, written notice to all other
Co-Tenants of the name and address of such new Co-Tenant and the
interest held by such new Co-Tenant.
9. This Agreement shall not create any partnership or joint
venture among or between the Co-Tenants or any of them; no Co-
Tenant shall file any partnership tax returns nor otherwise take
any action respecting nor represent the relationship among the Co-
Tenants as other than co-tenants of undivided interests in real
property. The only relationship among and between the Co-Tenants
hereunder shall be that of owners of the Premises as tenants in
common subject to the terms hereof.
10. The unenforceability or invalidity of any provision or
provisions of this Agreement as to any person or circumstances
shall not render that provision, nor any other provision hereof,
unenforceable or invalid as to any other person or circumstances,
and all provisions hereof, in all other respects, shall remain
valid and enforceable.
11. In the event any litigation arises between the parties
hereto relating to this Agreement, or any of the provisions
hereof, the party prevailing in such action shall be entitled to
receive from the losing party, in addition to all other relief,
remedies and damages to which it is otherwise entitled, all
reasonable costs and expenses, including reasonable attorneys'
fees, incurred by the prevailing party in connection with said
litigation.
12. To the extent that this agreement binds all Co-Tenants of
the Premises, such covenants are deemed to run with the land and
shall be evidenced in a Co-Tenancy Agreement entered into by any
Co-Tenant with any purchaser of all or any portion of its
interest in the Premises. Except as otherwise provided or
modified herein, Co-Tenants retain all rights otherwise available
under law to any Co-Tenant of an interest in Real Property.
13. Every Co-Tenant shall have a right of first refusal to
purchase the interest of any other Co-Tenant in the Premises,
upon the following limited terms and conditions. If and only
when a Co-Tenant shall give written notice to another Co-Tenant
(and only as to such Co-Tenant receiving such notice) of a desire
to be notified of any proposed sale "Notice of Desire to
Purchase"), Co-Tenants desiring notice of proposed sales of Co-
Tenancy interests shall receive notice of proposed sales of the
interest of the Co-Tenant who has received a Notice of Desire to
Purchase. Any Co-Tenant offering its interest or any portion
thereof for sale ("Selling Co-Tenant") shall first notify all Co-
Tenants who have provided a Notice of Desire to Purchase. Such
Co-Tenant Initial: /s/ JDR /s/ MMR
Co-Tenancy Agreement for Children's World Learning Center-Golden, Colorado
notice ("Selling Co-Tenant's Notice") shall give Selling Co-
Tenant's name and address and state a price at which Selling Co-
Tenant intends to sell and will sell a specified portion or all
of its interest in the fee simple to the Leased Premises.
If a Co-Tenant shall fail to exercise its Right of First Refusal
as set forth herein, those Co-Tenant's exercising their Right of
First Refusal shall buy all, but not less than all, of the
interest in the Premises offered for sale by the Selling Co-
Tenant, purchasing prorata in proportion that the purchasing Co-
Tenant's interests in the Premises shall bear to one another.
For ten (10) business days (the "Right of First Refusal Period")
following the giving of such notice, a Co-Tenant shall have the
option to purchase such portion of the fee interest of the
Selling Co-Tenant as set forth in Selling Co-Tenant's Notice at
the price in cash stated in the Selling Co-Tenant's Notice. A
written notice addressed to Selling Co-Tenant and signed by the
purchasing Co-Tenant shall be given, in accordance with the
provisions hereof respecting the giving of notice, within the
period set forth above for exercising the Right of First Refusal.
If no Co-Tenant shall exercise its Right of First Refusal,
Selling Co-Tenant shall be free to market its interest in the
Premises after expiration of the Right of First Refusal Period
and shall be free to sell all or any portion of its interest in
the Premises at a price prorata greater than, or equal to, that
which is set forth in the Selling Co-Tenant's Notice.
The above provisions shall not apply to the sale or transfer of a
Co-Tenant's interest in the Premises if such sale or transfer
shall be to an affiliate of the selling or transferring Co-Tenant
or to a trust established by such Co-Tenant for estate planning
purposes.
IN WITNESS WHEREOF, The parties hereto have caused this Agreement
to be executed and delivered, as of the day and year first above
written.
(REMAINDER OF PAGE INTENTIONALLY LEFT BLANK)
Co-Tenant Initial: /s/ JDR /s/ MMR
Co-Tenancy Agreement for Children's World Learning Center-Golden, Colorado
Xxx Xxxxx X. Xxx and Xxxx X. Xxx AKA Xxxx Xxxxxxxx Xxx
By: /s/ Xxxxx X Xxx
Xxxxx X. Xxx
By: /s/ Xxxx X Xxx
Xxxx X. Xxx AKA Xxxx Xxxxxxxx Xxx
WITNESS:
(Both signers)
/s/ Xxxxxxx X X'Xxxxxxxxx
/s/ Xxxxx Starkgman
(Print Name)
STATE OF MICHIGAN)
) ss
COUNTY OF OAKLAND)
I, a Notary Public in and for the state and county of aforesaid,
hereby certify there appeared before me this 5th day of March,
2001, Xxxxx X. Xxx and Xxxx X. Xxx AKA Xxxx Xxxxxxxx Xxx, married
as joint tenants, who executed the foregoing instrument in said
capacity.
/s/ Xxxxxxx X X'Xxxxxxxxx
Notary Public
[notary seal]
Fund XXII AEI Income & Growth Fund XXII Limited Partnership
By: AEI Fund Management XXI, Inc, its corporate general partner
By: /s/ Xxxxxx X Xxxxxxx
Xxxxxx X. Xxxxxxx, President
WITNESS:
/s/ Xxxxx X Xxxxxx
Xxxxx X Xxxxxx
(Print Name)
State of Minnesota )
) ss.
County of Xxxxxx )
I, a Notary Public in and for the state and county of aforesaid,
hereby certify there appeared before me this 9th day of March,
2001, Xxxxxx X. Xxxxxxx, President, who executed the foregoing
instrument in said capacity and on behalf of the corporation.
/s/ Xxxxxxx X Xxxxxx
Notary Public
[notary seal]
Exhibit A Legal Description
Xxx 0X, Xxxxx Xxxxx Xxxxxx, Xxxxxx Xx. 0, Xxxxx 2, Xxx 0 Xxxxxx,
Xxxxxx xx Xxxxxxxxx, Xxxxx xx Xxxxxxxx.
