ASSIGNMENT
OF
PURCHASE AGREEMENT
THIS
ASSIGNMENT made and entered into this 13th day of
May, 2004, by and between AEI FUND MANAGEMENT,
INC., a
Minnesota corporation, ("Assignor") and AEI
Income &
Growth
Fund XXII Limited Partnership, a Minnesota limited
partnership, 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 22nd day of April, 2004, Assignor
entered into a Purchase Agreement (referred to as the
"Agreement") for that certain property located at 16010
Kensington Drive, Sugar Land, TX (the "Property") with
TranSugar Limited Partnership, a Nevada
limited partnership,
as Seller; and
WHEREAS,
Assignor desires to
assign to AEI Income
&
Growth Fund XXII Limited Partnership, an
undivided forty
percent (40.0%) interest as a tenant in
common; and AEI
Accredited Investor Fund 2002 Limited Partnership, an
undivided sixty percent (60.0%) 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.,
a Minnesota corporation
By: /s/ Robert P Johnson
Robert P. Johnson, its President
ASSIGNEE:
AEI INCOME & GROWTH
FUND XXII Limited Partnership,
a Minnesota limited partnership
By: AEI Fund Management XXI, Inc.,
a Minnesota
corporation, its General Partner
By:/s/ Robert P Johnson
Robert P. Johnson, its President
AEI ACCREDITED INVESTOR
FUND 2002 Limited Partnership,
a Minnesota limited partnership
By: AEI Fund Management XVIII,
Inc.,
a Minnesota
corporation, its General Partner
By: /s/ Robert P Johnson
Robert P. Johnson, its President
PURCHASE AGREEMENT AND
ESCROW INSTRUCTIONS
THIS
PURCHASE
AGREEMENT AND ESCROW INSTRUCTIONS (this
"Agreement") is made and entered into
effective as of this
22nd
day of April, 2004 (the "Effective Date") by and between
TRANSUGAR LIMITED PARTNERSHIP, a Nevada limited partnership
("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 16010 Kensington Drive,
Sugarland,
Texas
77478, 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 Inc., a Delaware corporation
("Sterling") pursuant to that certain lease agreement between
Seller and Sterling dated December 1,
2000, as amended
December
1, 2000 and April 5, 2001, a copy of which
will be provided
to
Buyer within three (3) days after the Effective Date
(collectively, 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 Three Million Seven Hundred
Seventy-Six
Thousand
Nine Hundred Dollars ($3,776,900) (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 one
(1) 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
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
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 five
(5) 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
partnership 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 Updated Environmental
Site Assessment
Report prepared by Associated
Environmental
Consultants, Inc.
dated May 29,
2001, the Phase I Environmental Site
Assessment
Report prepared
by Associated Environmental
Consultants,
Inc. dated
June 2000 and the
Environmental Data Search prepared for Associated
Environmental, Inc. by
TelAll Corporation
dated
June 21, 2000 (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 Tom
Robinson, Fred Goldstein, John Plunkett or Steve
Shapiro. 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.
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
