PURCHASE AGREEMENT
0000 Xxxx Xxxxxxxx Xxxxxxxxx
Xxxx Xxxxxx, XX
This AGREEMENT, entered into effective as of the 31 of October,
2002.
l. Parties. Seller is AEI Real Estate Fund XVII Limited
Partnership ("Seller"). Seller holds an undivided 100% interest
in the fee title to that certain real property legally described
in the attached Exhibit "A" (the "Property"). Buyer is GB Land
L.L.C. and/or its assigns ("Buyer"). Seller wishes to sell and
Buyer wishes to buy the Property.
2. Property. The Property to be sold to Buyer in this transaction
is legally described on Exhibit A attached hereto.
3. Purchase Price. The purchase price for this Property is
$1,100,000 cash, based on the following terms:
4. Terms. The purchase price for the Property will be paid by
Buyer as follows:
(a) When this agreement is executed, Buyer will pay $10,000
in cash or good funds (the "First Payment") to Land America,
Attn: Xxxxxx Xxxxxxx, 0000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 000,
Xxxxxxx, XX 00000 ("Escrowee"). The First Payment will be
credited against the purchase price when and if escrow
closes and the sale is completed, or otherwise disbursed
pursuant to the terms of this Agreement. The First Payment
held for the account of Seller shall be non-refundable
unless Seller shall default hereunder or if Seller is
unwilling or unable to cure any title, survey or
environmental defects.
(b) Buyer will pay the balance of purchase price for the
Property, $1,090,000 in cash or good funds (the "Second
Payment"), at closing to the Escrowee who shall close the
transaction according to the terms hereof.
5. Closing Date. Escrow shall close on or before the thirtieth
day after the Effective Date of this Agreement.
6. Due Diligence. Buyer will have until the expiration of the
15th day after the Effective Date of this Agreement (the
"Inspection and Feasibility Study Period"), to conduct all of its
inspections and due diligence and satisfy itself regarding title
to the Property, and to inspect the Property at Buyer's sole
expense. Buyer agrees to indemnify and hold Seller harmless for
any loss or damage to the Property or persons caused by Buyer or
its agents arising out of such physical inspections of the
Property. Buyer expressly acknowledges that the sale of the
Property as provided for herein is made on an "AS IS" basis, and
such provision shall survive closing.
Buyer may cancel this Agreement for any reason in its sole
discretion by delivering a cancellation notice by certified mail,
return receipt requested, or by personal delivery to Seller and
escrow holder before the expiration of the Inspection and
Feasibility Study Period. The First Payment shall be non-
refundable unless contingencies in section 20 have not been met
or Seller shall default hereunder or if Seller is unwilling or
unable to cure any title, survey or environmental defects.
If Buyer cancels this Agreement as permitted under this
Section or Sections 16 or 17, except for any liabilities under
sections 15(a)(iii) and 16(b) of this Agreement (which will
survive), (after execution of such documents reasonably requested
by Seller to evidence the termination hereof), 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 Seller shall be in default of any obligation
hereunder, or this Agreement is canceled by Buyer pursuant to the
terms hereof, if Buyer fails to make the Second Payment, Seller
shall be entitled to retain the First Payment and Buyer
irrevocably will be deemed to have canceled this Agreement and
relinquished all rights in and to the Property. If this Agreement
is not canceled and the Second Payment is made when required, all
of Buyer's conditions and contingencies will be deemed satisfied.
7. Escrow. Escrow shall be opened by Buyer and the First Payment
shall be deposited by Buyer with Escrowee. 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. The parties
agree to sign these additional instructions of the Escrowee, if
any. If there is any conflict between these other instructions
and this Agreement, this Agreement will control. Seller shall
notify Escrowee upon Seller's acceptance of this Agreement.
8. Title. Closing will be conditioned on the commitment of
Escrowee 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 marketable and insurable fee simple
title to the Property subject only to: the exceptions reflected
in the title commitment reasonably acceptable to Buyer (the
"Permitted Exceptions"), current real property taxes and
assessments; and survey exceptions. Buyer shall have a Title
Commitment issued and tendered to Buyer, with a copy to Seller,
within ten (10) days of the date this Purchase Agreement is
delivered to Escrowee.
Buyer shall be allowed until the expiration of the
"Inspection and Feasibility Study Period" for examination and the
making of any objections to the survey and to any exception
contained in the Title Commitment, said objections to be made in
writing or deemed waived. If any objections are so made, the
Seller shall be allowed thirty (30) days to cure Buyer's
objections, or in the alternative to obtain a commitment for
insurable title insuring over Buyer's objections. If within such
30-day period Seller fails to cure Buyer's objections, or is
unable to obtain insurable title to Buyer's reasonable
satisfaction, Buyer may elect to cancel this Agreement and (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.
If Buyer shall make no written objection to Seller within
the Review Period setting forth Buyer's objections to the status
of title, Buyer shall have been deemed to have waived any such
objections.
9. Closing Costs. Buyer will pay the transfer taxes, if any, and
all escrow fees attributable to the closing services for this
transaction. Buyer will pay the cost of issuing the title
commitment and the cost of the title insurance premium for an
Owner's policy. Buyer will pay the mortgage registration tax,
the costs of a new survey or an update to the Survey in Seller's
possession (if an update is required by Buyer). Buyer will pay
broker commissions, if any. All other closing costs shall be
paid by Buyer. Each party will pay its own attorneys' fees and
costs to document and close this transaction.
10. Real Estate Taxes, Special Assessments and Prorations. BUYER
UNDERSTANDS THAT THERE ARE UNPAID REAL ESTATE TAXES AND AGREES TO
ASSUME FULL RESPONSIBILITY FOR PAYMENT OF THOSE TAXES OWED.
RESPONSIBILITY FOR REAL ESTATE TAXES AND SPECIAL ASSESSMENTS
SHALL NOT BE PRORATED AS OF THE DATE OF CLOSING AS THE BUYER IS
RESPONSIBLE FOR PAYMENT IN FULL. ALL REAL ESTATE TAXES AND
SPECIAL ASSESSMENTS DUE AND PAYABLE IN THE YEARS FOLLOWING THE
YEAR IN WHICH CLOSING OCCURS SHALL OTHERWISE BE THE
RESPONSIBILITY OF BUYER. THE PARTIES ACKNOWLEDGE AND AGREE THAT
THE TENANT OF THE PROPERTY IS RESPONSIBLE FOR PAYMENT OF TAXES
AND THUS NO ACTUAL PRORATION OF FUNDS AT CLOSING SHALL OCCUR.
11. Seller's Representation and Agreements.
Seller represents and warrants as of this date that:
(i) It is not aware of any pending litigation or
condemnation proceedings against the Property or Seller's
interest in the Property.
(ii) It is not aware of any contracts affecting this
Property and potentially or actually binding on Buyer after
the closing date except (a.) that certain Waiver signed
September 30, 1997 by Seller in favor of the Franchise
Finance Division of Green Tree Financial Servicing
Corporation ("Green Tree") and (b.) the Net Lease Agreement
effective March 1, 1989 between Huntington Restaurants
Group, Inc. and AEI Real Estate Fund XVII Limited
Partnership as may have been amended in writing from time to
time.
(iii) 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.
12. Disclosures.
(a) Seller has been an absentee landlord. Consequently,
Seller has little, if any, knowledge of the physical
characteristics of the Property.
Accordingly, except as otherwise specifically stated in the
Agreement, Seller hereby specifically disclaims any
warranty, guaranty, or representation, oral or written,
past, present, or future of, as to, or concerning (i) the
nature and condition of the Property, including, without
limitation, the water, soil, and geology, and the
suitability thereof and of the Property for any and all
activities and uses which Buyer may elect to conduct
thereon; (ii) except for the warranty of title contained in
the Deed to be delivered by Seller at the closing, the
nature and extent of any right of way, lease, possession,
lien, encumbrance, license, reservation, condition, or
otherwise, and (iii) the compliance of the Property or its
operation with any laws, ordinances, or regulations of any
government or other body.
(b) Buyer acknowledges and agrees that Buyer is not relying
upon any representation or warranties made by Seller or
Seller's Agent except those provided herein.
(c) Buyer acknowledges that, having been given the
opportunity to inspect the Property, 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 expressly acknowledges that, in
consideration of the agreements of the Seller herein, except
as otherwise specified herein, Seller makes no Warranty or
representation, express or implied, or arising by operation
of law, including, but not limited to, any warranty of
condition, habitability, tenantability, suitability for
commercial purposes, merchantability, profitability, or
fitness for a particular purpose, in respect of the
Property.
(d) BUYER AGREES THAT IT SHALL BE PURCHASING THE PROPERTY IN
ITS THEN PRESENT CONDITION, AS IS, WHERE IS, AND SELLER HAS
NO OBLIGATION TO CONSTRUCT OR REPAIR ANY IMPROVEMENTS
THEREON, OR TO PERFORM ANY OTHER ACT REGARDING THE PROPERTY.
WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, BUYER ALSO
AGREES THAT SELLER WILL HAVE NO LIABILITY OF ANY TYPE,
DIRECT OR INDIRECT, TO BUYER OR BUYER'S SUCCESSORS, ASSIGNS,
LENDERS OR AFFILIATES IN CONNECTION WITH ANY HAZARDOUS,
TOXIC, DANGEROUS, FLAMMABLE, EXPLOSIVE OR CHEMICAL
SUBSTANCES OF ANY TYPE (WHETHER OR NOT DEFINED AS SUCH UNDER
ANY APPLICABLE LAWS) ON OR IN CONNECTION WITH THE PROPERTY
EITHER BEFORE OR AFTER THE CLOSING DATE.
(e) Buyer acknowledges and agrees that the Property is
subject to that certain Lease by and between Seller and
Lessee Huntington Restaurants Group, Inc., dated March 1,
1989, as may have been amended in writing from time to time.
Buyer understands that the Lessee is in substantial default
under the Lease, that said defaults may not be cured prior
to the date of Closing, that said defaults are likely to
persist after the date of Closing, and that Seller reserves
all rights to pursue Lessee and any Guarantors of the Lease
for all matters of default occurring prior to the date of
Closing of the sale to Buyer hereunder. Furthermore, Buyer
understands and agrees that the Lease is subject to a Right
of First Refusal in favor of Lessee, and that Seller's
obligation to perform hereunder is subject to Seller's
receipt of a waiver of said Right of First Refusal by
Lessee.
The provisions (a) through (e) shall survive closing.
13. Closing.
(a) Before the closing date, Seller will deposit into escrow
an executed special warranty deed subject to the Permitted
Exceptions conveying good and indefeasible title of the
Property to Buyer. At Closing, Seller shall deliver to
Buyer and the Title Company a standard Seller's Affidavit
regarding liens and judgments. Buyer will be given two (2)
business days, prior to closing, to review and approve all
closing documents.
(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.
14. Defaults. If Buyer defaults, Buyer will forfeit all rights
and claims to the Property and Seller will be relieved of all
obligations and will be entitled to retain all monies heretofore
paid by the Buyer as Seller's sole remedy.
If Seller shall default, Buyer may, at its option, either
terminate this Agreement and receive a full and immediate refund
of the First Payment or seek to enforce specific performance of
this Agreement. Provided, however, that in no event shall Seller
be liable for any consequential, punitive or speculative damages
arising out of any default by Seller hereunder.
15. Buyer's Representations and Warranties.
a. Buyer represents and warrants to Seller as follows:
(i) 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
jurisdiction hereof, or (c) any agreement or instrument to
which Buyer is a party or by which Buyer is bound.
(iii) Buyer agrees to indemnify and hold Seller harmless
from any and all claim of any persons or entities claiming a
brokerage or other fee arising out of representation of
Buyer.
16. Property Inspection and Environmental.
(a) Seller shall provide Buyer access to the Property from
time to time for the purpose of conducting inspections
thereof including mechanical, structural, electrical and
other physical inspections. Buyer has until the end of the
Inspection and Feasibility Study Period to complete such
physical inspections.
(b) Buyer shall indemnify, defend, and hold harmless Seller
from and against any and all losses, claims, causes of
action, liabilities, and costs to the extent caused by the
actions of Buyer, its agents, employees, contractors, or
invitees, during any such entry upon the Property. The
foregoing duty of indemnification shall include the duty to
pay all reasonable attorney's fees incurred by the Seller in
responding to or defending any such claims or proceedings,
and shall survive closing.
(c) Buyer shall pay for any Phase I Environmental studies it
wants to be performed on the Property. If Buyer desires a
Phase I Environmental, Buyer shall obtain and review the
same within the Inspection and Feasibility Study Period. If
Buyer terminates this Agreement prior to the expiration of
the Inspection and Feasibility Study Period, Buyer will
provide Seller with copies of all reports and test results
Buyer had performed on the Property.
17. 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
$20,000, 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 period provided for above in this Subparagraph 17a 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 resulting from said damage or destruction to the
extent that the same are payable with respect to damage to
the Property.
If the cost of repair is less than $20,000.00, 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 in relation to the
Property.
(b) If, prior to closing, the Property, or any part thereof,
is taken or notice of a taking is received from any
condemning authority (other than as disclosed in writing to
Buyer prior to the date of this Agreement) 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 all the Seller's right, title,
and interest in and to any award made, or to be made, in the
condemnation proceeding in relation to the Property.
In the event that this Agreement is terminated by Buyer as
provided above in Subparagraph 17(a) or 17(b), 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).
18. Seller's and Buyer's Brokers. The Seller is not represented
by a broker in this transaction. Any real estate broker
commission earned by a broker enlisted by the Buyer is to be paid
solely by the Buyer. Both parties represent and warrant that no
other broker has been involved on behalf of the warranting party,
and both parties agree to indemnify the other and hold harmless
from any claim through or on behalf of such other party.
19. Cancellation If either party elects to cancel this Contract
because of any breach by the other party, the party electing to
cancel shall deliver to the defaulting party and the escrow agent
a notice stating that this Contract shall be canceled unless the
breach is cured within 5 days following the delivery of the
notice to the defaulting party. If the breach is not cured
within the 5 days following the delivery of the notice to the
defaulting party, this Contract shall be canceled.
20. Contingencies This agreement is subject to the following
contingencies:
(a) Subject to Buyers ability to obtain a one million one
hundred thousand dollar ($1,100,000) loan from Textron
Financial.
(b) Subject to Xxxxx'x, Inc. approving this transaction as
well as the purchase of the Denny's business and obtaining a
franchise agreement for GB Restaurants, Inc.
21. 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) FUNDS TO BE DEPOSITED OR PAID BY BUYER WILL BE GOOD AND
CLEAR FUNDS IN THE FORM OF CASH, CASHIER'S CHECKS OR WIRE
TRANSFERS.
(c) All notices from either of the parties hereto to the
other shall be in writing and shall be considered to have
been duly given or served if sent by first class certified
mail, return receipt requested, postage prepaid, or by a
nationally recognized courier service guaranteeing overnight
delivery to the party at his or its address set forth below,
or to such other address as such party may hereafter
designate by written notice to the other party.
If to Seller:
Attention: Xxxxxx X. Xxxxxxx
AEI Real Estate Fund XVII Limited Partnership
1300 Minnesota World Trade Center
00 X. 0xx Xxxxxx
Xx. Xxxx, XX 00000-0000
If to Buyer:
Attn: Xxxxx Xxxxxxx
GB Land LLC
000 X Xxxx Xxx
Xxxxxxxx, XX 00000
(d) Buyer may assign this Agreement at any time without the
consent or prior approval of Seller, and following any such
assignment, Seller agrees to close this transaction with the
assignee of Buyer. The original Buyer named herein shall
remain liable for any indemnity obligations hereunder.
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, and delivering a copy of this Agreement
signed by Buyer and the $10,000.00 First Payment to Escrowee;
Escrowee shall sign below acknowledging receipt of this Agreement
signed by Buyer and the First Payment, which will be deposited in
to escrow by Escrowee. Seller has seven (7) business days after
receipt of the executed offer and acknowledgment of receipt of
the First Payment by Escrowee within which to accept this offer
by fully executing this contract and giving both Buyer and
Escrowee written notice thereof; if not accepted by Seller,
Escrowee shall immediately return the First Payment to Buyer and
shall not require any releases by the Seller. The Effective Date
of this Agreement shall be the date Buyer receives a fully
executed original counterpart of this Agreement.
IN WITNESS WHEREOF, the Seller and Buyer have executed this
Agreement effective as of the day and year above first written.
BUYER:
GB Land L.L.C.
By: /s/ Xxxxx Xxxxxxx
Its: Member
Title
SELLER:
AEI REAL ESTATE FUND XVII LIMITED PARTNERSHIP, a Minnesota
limited partnership.
By: AEI Fund Management XVII, Inc., its corporate general
partner
By: /s/ Xxxxxx X Xxxxxxx
Xxxxxx X. Xxxxxxx, President
ESCROWEE:
The Title Company hereby acknowledges receipt of a fully
executed copy of this Agreement executed by buyer only and the
First Payment referred to in the Agreement on Nov 6, 2002, and
agrees to accept, hold, deliver and disburse the First Payment
and Second Payment, together with all interest accrued thereon
and received by the Title Company, strictly in accordance with
the terms and provisions of this Agreement. In performing any of
its duties hereunder, the Title Company shall not incur any
liability to anyone for any damages, losses or expenses, except
for negligence, willful default or breach of trust, and it shall
accordingly not incur any liability with respect (i) to any
action taken or omitted in good faith upon advice of its counsel,
or (ii) to any action taken or omitted in reliance upon any
instrument, including any written notice or instruction provided
for in this Agreement, not only as to its due execution and the
validity and effectiveness of its provisions, but also as to the
truth and accuracy of any information contained therein, which
the Title Company shall in good faith believe to be genuine, to
have been signed or presented by a proper person or persons and
to conform with the provisions of this Agreement. Seller and
Buyer hereby agree to indemnify and hold harmless the Title
Company against any and all losses, claims, damages, liabilities
and expenses, imposed upon the Title Company or incurred by the
Title Company in connection with its acceptance or the
performance of its duties hereunder, including any litigation
arising from this Agreement or involving the subject matter
hereof, unless such losses, claims, damages, liabilities and
expenses arise out of Title Company's negligence, willful default
or breach of trust. In the event of a dispute between Seller and
Buyer sufficient in the discretion of the Title Company to
justify its doing so, the Title Company shall be entitled to
tender into the registry of the District Court of Pinal County,
Arizona, all money or property in its hands under this Agreement,
together with such legal pleadings as it deems appropriate, and
thereupon be discharged from all further duties and liabilities
under this Agreement. Seller and Buyer shall bear all costs and
expenses of such legal proceedings.
Lawyers Title Insurance Corporation
By: /s/ Xxxxx X Xxxxxx
Its: National Title Officer
Exhibit A
Legal Description
Commitment No. 62,909-T
A portion of TRACT "A", of LOS PRADOS, according to the plat of
record in the office of the County Recorder of Pinal County
Arizona, recorded in Cabinet A, Slide 187, and corrected in
Cabinet A, Slide 190, more particularly described as follows:
BEGINNING at a point on the East line of said Tract "A", said
point also being the Northeast corner of Tract "B" of said plat;
Thence North 89 41' 00" West, 225.00 feet, along the North line
of said Tract "B", to the Northwest corner thereof;
Thence North 00 19' 00" East, 147.97 feet, along a line that is
the Northerly projection of the West line of said Tract "B", to a
point on the North line of said Tract "A";
Thence North 89 48' 00" East, 194.74 feet, along the North line
of said Tract "A";
Thence along a curve to the right having a radius of 30.00 feet,
a central angle of 90 31' 00", and an arc length of 47.39, to a
point of tangency;
Thence South 00 19' 00" West, 119.73 feet, along the East line of
said Tract "A", to the POINT OF BEGINNING.
