PURCHASE AGREEMENT
Applebee's Restaurant - Harlingen, TX
This AGREEMENT, entered into effective as of the 10th of
November, 1998.
l. Parties. Seller is AEI Real Estate Fund 85-A Limited
Partnership ("Seller") which owns an undivided 100.00% interest
in the fee title to that certain real property legally described
in the attached Exhibit "A" (the "Property") Buyer is Renaissant
Development Corporation ("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, subject to all
the easements, convenants, conditions, restrictions and
agreements of record which are permitted exceptions in accordance
with paragraph 8 hereof("Permitted Exceptions").
3. Purchase Price. The purchase price for the Property is
$1,861,904 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 $1,000
to Seller (the "First Payment"). 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.
(b) Buyer will deposit the balance of the purchase price,
$1,860,904 (the "Second Payment") into escrow in sufficient
time to allow escrow to close on the closing date.
(c) Seller hereby acknowledges receipt of the sum of $50.00
cash (the "Option Consideration") from Buyer, as
cosideration for execution of the Agreement by Seller. If
the purchase and sale of the Property is consummated
pursuant to this Agreement, the Option Consideration shall
be applied toward the purchase price paid by Buyer. If this
Agreement is terminated pursuant to a default by Seller
hereunder, the Option Consideration shall be immediately
returned by Seller to Buyer. If this Agreement is
terminated for any reason other than a default by Seller
hereunder, Seller shall be entitled to retain the Option
Consideration.
5. Closing Date. Escrow shall close on or before December 31,
1998.
6. Due Diligence. Buyer will have until the expiration of the
fifth business day after delivery of each of following items, to
be supplied by Seller, to conduct all of its inspections and due
diligence and satisfy itself regarding each item, the Property,
and this transaction. Buyer agrees to indemnify and hold Seller
harmless for any loss or damage to the Property or persons caused
by Buyer or its agents arising out of such physical inspections
of the Entire Property. (The "Review Period")
(a) The original and one copy of a title insurance
commitment for an Owner's Title insurance policy (see
paragraph 8 below).
(b) Copies of a Certificate of Occupancy or other such
document certifying completion and granting permission to
permanently occupy the improvements on the Entire Property
as are in Seller's possession.
Buyer Initial: /s/ ARA
Purchase Agreement for Applebee's - Harlingen, TX
(c) Copies of an "as built" survey of the Property done
concurrent with Seller's acquisition of the Property.
(d) Phase I Evironmental Site Assessment
Buyer may cancel this agreement for any reason in its sole
discretion by delivering a cancellation notice, return receipt
requested, to Seller and escrow holder before the expiration of
the Review period. Such notice shall be deemed effective only
upon receipt by Seller in accordance with paragraph 18(d) below.
If this Agreement is not cancelled as set forth above, the First
Payment shall be non-refundable unless Seller shall default
hereunder.
If Buyer fails to make the Second Payment, Seller shall be
entitled to retain the First Payment and Buyer irrevocably will
be deemed to be in default under this Agreement. Seller may, at
its option, retain the First Payment and declare this Agreement
null and void, in which event Buyer will be deemed to have
canceled this Agreement and relinquish all rights in and to the
Property or Seller may exercise its rights under Section 14
hereof. If this Agreement is not canceled and the Second Payment
is made when required, all of Buyer's conditions and
contingencies will be deemed satisfied.
Unless this Agreement is canceled by Buyer pursuant to the
terms hereof, if Buyer fails to make the Second Payment, Seller
shall be entitled to retain the First Payment and Buyer
irrevocably will be deemed to be in default under this Agreement.
Seller may, at its option, retain the First Payment and declare
this Agreement null and void, in which event Buyer will be deemed
to have canceled this Agreement and relinquish all rights in and
to the Property or Seller may exercise its rights under Section
14 hereof. If this Agreement is not canceled and the Second
Payment is made when required, all of Buyer's conditions and
contingencies will be deemed satisfied.
7. Escrow. Escrow shall be opened by Seller and funds deposited
in escrow upon acceptance of this Agreement by both parties. The
escrow holder will be the title company referenced in the
commitment for title insurance described in paragraph 8 hereof
(the "Title Company"). A copy of this Agreement will be delivered
to the escrow holder and will serve as escrow instructions
together with the escrow holder's standard instructions and any
additional instructions required by the escrow holder to clarify
its rights and duties (and the parties agree to sign these
additional instructions). If there is any conflict between these
other instructions and this Agreement, this Agreement will
control.
8. Title. Closing will be conditioned on the agreement of the
Title Company 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 good and
indefeasible title to the Property subject only to: the title
company's standard exceptions; current real property taxes and
assessments; survey exceptions; the rights of parties in
possession pursuant to the lease defined in paragraph 11 below;
and other items of record disclosed to Buyer during the Review
Period.
Buyer shall be allowed five (5) days after receipt of said
commitment for examination and the making of any objections to
marketability thereto, said objections to be made in writing or
deemed waived. If any objections are so made, the Seller shall
be allowed eighty (80) days to make such title marketable or in
the alternative to obtain a commitment for good and indefeasible
title insuring over Buyer's objections. If Seller shall decide
to make no efforts to make title marketable, or is unable to make
title marketable or obtain insurable title, (after execution by
Buyer of such documents reasonably requested by Seller to
evidence the termination hereof) Buyer's First Payment shall be
returned and this Agreement shall be null and void and of no
further force and effect. Seller has no obligation to spend any
funds or make any effort to satisfy Buyer's objections, if any.
Buyer Initial: /s/ ARA
Purchase Agreement for Applebee's - Harlingen, TX
Pending satisfaction of Buyer's objections, the payments
hereunder required shall be postponed, but upon satisfaction of
Buyer's objections and within ten (10) days after written notice
of satisfaction of Buyer's objections to the Buyer, the parties
shall perform this Agreement according to its terms.
9. Closing Costs. Seller will pay the cost of the title
commitment, the costs of the preparation of the appropriate
warranty deed and other documents to be delivered by Seller and
one-half of escrow fees, survey, and recording fees. The Buyer
will pay the cost of issuing a Standard Owners Title Insurance
Policy in the full amount of the purchase price, if Buyer shall
decide to purchase the same. Buyer will pay one half of escrow
fees, survey, and recording fees. Each party will pay its own
attorney's fees and costs to document and close this transaction.
10. Real Estate Taxes, Special Assessments and Prorations.
(a) Because the Property is subject to a triple net lease
(as further set forth in paragraph 11(a)(i), the parties
acknowledge that there shall be no need for a real estate
tax proration. However, Seller represents that to the best
of its knowledge, all real estate taxes and installments of
special assessments due and payable in all years prior to
the year of Closing have been paid in full.
(b) All income and all operating expenses 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 and shall be responsible for all expenses
incurred prior to the date of 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.
11. Seller's Representation and Agreements.
(a) Seller represents and warrants as of this date that:
(i) Except for the lease in existence between AEI Real
Estate Fund 85-A Limited Partnership and Renaissant
Development Corporation, dated December 21, 1995 (the
"Existing Lease"), Seller is not aware of any leases of the
Property. Upon Closing, the Existing Lease shall be
terminated and of no further force or effect except for
obligations accruing prior to Closing
(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 set
forth in paragraph (b) below, Seller is not aware of any
contracts Seller has executed that would be binding on Buyer
after the closing date.
(b) Provided that Buyer performs its obligations when
required, Seller agrees that it will not enter into any new
contracts that would materially affect the Property and be
binding on Buyer after the closing date without Buyer's
prior consent, which will not be unreasonably withheld.
(c) 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 Closing or after
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.
Buyer Initial: /s/ ARA
Purchase Agreement for Applebee's - Harlingen, TX
(d) 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.
12. Disclosures.
(a) Seller has received no notice that there are now any
material, physical or mechanical defects of the Property,
including, without limitation, the plumbing, heating, air
conditioning, ventilating, electrical systems, and 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.
(b) Seller has received no notice that the use and
operation of the Property now 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.
(c) Seller knows of no facts nor has Seller failed to
disclose to Buyer any fact known to Seller which would
prevent Buyer 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.
(d) Seller has received no notice that the Property is in
violation of any federal, state or local law, ordinance or
regulations relating to industrial hygiene or to 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. 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 negligence or intentional misconduct in
violation of applicable state or federal law or regulation.
(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.
The provisions (d) - (e) above shall survive Closing. Any
notice of the type described in (a), (b) or (d) above
received by Seller prior to Closing shall be promptly
forwarded to Buyer.
13. Closing.
(a) Before the closing date, Seller will deposit into
escrow an executed general warranty deed conveying
insurable, good and indefeasible title of the Property to
Buyer, subject only the Permitted Exceptions.
(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.
Buyer Initial: /s/ ARA
Purchase Agreement for Applebee's - Harlingen, TX
(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; 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 and Seller will be relieved of all obligations and as
its sole remedy will be entitled to retain the First Payment as
liquidated damages.
If Seller shall default, Buyer irrevocably waives any rights
to file a lis pendens, a specific performance action or any other
claim, action or proceeding of any type in connection with the
Property or this or any other transaction involving the Property,
and will not do anything to affect title to the Property or
hinder, delay or prevent any other sale, lease or other
transaction involving the Property (any and all of which will be
null and void), unless: it has paid the First Payment, deposited
the balance of the Second Payment for the purchase price into
escrow, performed all of its other obligations and satisfied all
conditions under this Agreement, and unconditionally notified
Seller that it stands ready to tender full performance, purchase
the Property and close escrow as per this Agreement, regardless
of any alleged default or misconduct by Seller. Provided,
however, that in no event shall Seller be liable for any actual,
punitive, consequential 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) 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.
16. Damages, Destruction and Eminent Domain.
(a) If, prior to closing, the Property or any part thereof
be destroyed or further damaged by fire, the elements, or
any cause, due to events occurring subsequent to the date of
this Agreement to the extent that the cost of repair exceeds
$10,000.00, this Agreement shall become null and void, at
Buyer's option exercised, if at all, by written notice to
Seller within ten (10) days after the date of such damage or
destruction.
Buyer Initial: /s/ ARA
Purchase Agreement for Applebee's - Harlingen, TX
(b) If, prior to closing, the Property, or any part
thereof, is taken by eminent domain, this Agreement shall
become null and void, at Buyer's option.
In the event that this Agreement is not terminated as
provided in Subparagraph 16a or 16b, the respective rights
and objections of the parties with regard to insurance and
condemnation proceeds shall be governed by the Existing
Lease. Upon Closing and the termination of the Existing
Lease, Seller shall have no further rights in any insurance
or condemnation proceeds, and all such proceeds received by
Seller (whether before or after Closing), shall be promptly
remitted to Buyer.
In the event that this Agreement is terminated by Buyer as
provided above in Subparagraph 16a or 16b, the First Payment
shall be immediately returned to Buyer (after execution by Buyer
of such documents reasonably requested by Seller to evidence the
termination hereof).
17. Cancellation
If any party elects to cancel this Contract because of any
breach by another party or because escrow fails to close by
the agreed date, the party electing to cancel shall deliver
to escrow agent a notice containing the address of the party
in breach and stating that this Contract shall be cancelled
unless the breach is cured within 13 days following the
delivery of the notice to the escrow agent. Within three
days after receipt of such notice, the escrow agent shall
send it by United States Mail to the party in breach at the
address contained in the Notice and no further notice shall
be required. If the breach is not cured within the 13 days
following the delivery of the notice to the escrow agent,
this Contract shall be cancelled.
18. 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 December 31, 1998
through no fault of Seller, Seller may either, at its
election, extend the closing date or exercise the remedy
provided in paragraph 14 hereof.
(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, received or served when a first class
certified letter containing such notice, return receipt
requested, postage prepaid is deposited in United States
Mails, or if sent by a nationally recognized courier service
guaranteeing overnight delivery to the party at his or its
address set forth below, or to such other address as such
party may hereafter designate by written notice to the other
party. Copies of any such notices shall be sent on the same
day as the day of mailing or delivery to the courier
service, as the case may be, by facsimile to the recipient
party at the telefax number set forth below.
Buyer Initial: /s/ ARA
Purchase Agreement for Applebee's - Harlingen, TX
If to Seller:
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
AEI Real Estate Fund 85-A Limited Partnership
1300 Minnesota World Trade Center
▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telefax: ▇▇▇-▇▇▇-▇▇▇▇
If to Buyer:
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Renaissant Development Corporation
▇▇▇▇ ▇▇ ▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telefax: ▇▇▇-▇▇▇-▇▇▇▇
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.
IN WITNESS WHEREOF, the Seller and Buyer have executed this
Agreement effective as of the day and year above first written.
BUYER: RENAISSANT DEVELOPMENT CORPORATION
By:/s/ ▇▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President/CEO
WITNESS:
/s/ ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
(Print Name)
WITNESS:
/s/ ▇▇▇▇▇ ▇ ▇▇▇▇▇
▇▇▇▇▇ ▇ ▇▇▇▇▇
(Print Name)
Buyer Initial: /s/ ARA
Purchase Agreement for Applebee's - Harlingen, TX
SELLER: AEI REAL ESTATE FUND 85-A LIMITED PARTNERSHIP a
Minnesota limited partnership
By: Net Lease Management 85-A, Inc., its corporate
general partner
By:/s/ ▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
WITNESS:
/s/ ▇▇▇▇▇ ▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇ ▇▇▇▇▇▇
(Print Name)
WITNESS:
/s/ ▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇
(Print Name)
Buyer Initial: /s/ ARA
Purchase Agreement for Applebee's - Harlingen, TX
EXHIBIT "A"
▇▇▇ ▇▇▇ (▇), ▇▇▇▇▇ ▇▇▇ (▇), ▇▇▇▇▇▇▇▇'▇ ▇▇. ▇ ▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇ of Harlingen, Cameron County, Texas, according to the
Map recorded in Cabint 1, Slot 1381-A, Map Records of
Cameron County, Texas.
