-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, HaOmfPIqqstOxZocmdj1G4hQJq2Z4A9R3jJmomRvLdrdErLUEYtkSveTq7LdXJM2 AAHU8dJT+1ieOSthW8IXyA== 0001023458-00-000002.txt : 20000509 0001023458-00-000002.hdr.sgml : 20000509 ACCESSION NUMBER: 0001023458-00-000002 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 12 CONFORMED PERIOD OF REPORT: 20000331 FILED AS OF DATE: 20000508 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AEI INCOME & GROWTH FUND XXII LTD PARTNERSHIP CENTRAL INDEX KEY: 0001023458 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500] IRS NUMBER: 411848181 STATE OF INCORPORATION: MN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-24003 FILM NUMBER: 621533 BUSINESS ADDRESS: STREET 1: 1300 MINNESOTA WORLD TRADE CENTER STREET 2: 30 EAST SEVENTH ST CITY: ST PAUL STATE: MN ZIP: 55101 BUSINESS PHONE: 6512277333 MAIL ADDRESS: STREET 1: 1300 MINNESOTA WORLD TRADE CENTER STREET 2: 30 SEVENTH ST EAST CITY: ST PAUL STATE: MN ZIP: 55101 10QSB 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB Quarterly Report Under Section 13 or 15(d) of The Securities Exchange Act of 1934 For the Quarter Ended: March 31, 2000 Commission file number: 24003 AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP (Exact Name of Small Business Issuer as Specified in its Charter) State of Minnesota 41-1848181 (State or other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification No.) 1300 Minnesota World Trade Center, St. Paul, Minnesota 55101 (Address of Principal Executive Offices) (651) 227-7333 (Issuer's telephone number) Not Applicable (Former name, former address and former fiscal year, if changed since last report) Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No Transitional Small Business Disclosure Format: Yes No [X] AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP INDEX PART I. Financial Information Item 1. Balance Sheet as of March 31, 2000 and December 31, 1999 Statements for the Periods ended March 31, 2000 and 1999: Income Cash Flows Changes in Partners' Capital Notes to Financial Statements Item 2. Management's Discussion and Analysis PART II. Other Information Item 1. Legal Proceedings Item 2. Changes in Securities Item 3. Defaults Upon Senior Securities Item 4. Submission of Matters to a Vote of Security Holders Item 5. Other Information Item 6. Exhibits and Reports on Form 8-K AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP BALANCE SHEET MARCH 31, 2000 AND DECEMBER 31, 1999 (Unaudited) ASSETS 2000 1999 CURRENT ASSETS: Cash and Cash Equivalents $ 1,969,440 $ 247,401 INVESTMENTS IN REAL ESTATE: Land 4,516,199 4,981,547 Buildings and Equipment 7,454,006 8,382,000 Property Acquisition Costs 7,068 0 Accumulated Depreciation (264,944) (201,635) ----------- ----------- Net Investments in Real Estate 11,712,329 13,161,912 ----------- ----------- Total Assets $13,681,769 $13,409,313 =========== =========== LIABILITIES AND PARTNERS' CAPITAL CURRENT LIABILITIES: Payable to AEI Fund Management, Inc. $ 129,357 $ 14,979 Distributions Payable 256,847 256,847 Unearned Rent 33,506 0 ----------- ----------- Total Current Liabilities 419,710 271,826 ----------- ----------- PARTNERS' CAPITAL (DEFICIT): General Partners (35,009) (38,746) Limited Partners, $1,000 Unit Value; 24,000 Units authorized; 16,917 Units issued; 16,808 outstanding 13,297,068 13,176,233 ----------- ----------- Total Partners' Capital 13,262,059 13,137,487 ----------- ----------- Total Liabilities and Partners' Capital $13,681,769 $13,409,313 =========== =========== The accompanying Notes to Financial Statements are an integral part of this statement. AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP STATEMENT OF INCOME FOR THE PERIODS ENDED MARCH 31 (Unaudited) 2000 1999 INCOME: Rent $ 298,260 $ 82,627 Investment Income 6,180 112,245 ----------- ----------- Total Income 304,440 194,872 ----------- ----------- EXPENSES: Partnership Administration - Affiliates 39,026 43,213 Partnership Administration and Property Management - Unrelated Parties 13,968 8,905 Depreciation 86,690 14,502 ----------- ----------- Total Expenses 139,684 66,620 ----------- ----------- OPERATING INCOME 164,756 128,252 GAIN ON SALE OF REAL ESTATE 221,420 0 ----------- ----------- NET INCOME $ 386,176 $ 128,252 =========== =========== NET INCOME ALLOCATED: General Partners $ 11,585 $ 3,848 Limited Partners 374,591 124,404 ----------- ----------- $ 386,176 $ 128,252 =========== =========== NET INCOME PER LIMITED PARTNERSHIP UNIT (16,808 and 16,580 weighted average Units outstanding in 2000 and 1999, respectively) $ 22.29 $ 7.50 =========== =========== The accompanying Notes to Financial Statements are an integral part of this statement. AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP STATEMENT OF CASH FLOWS FOR THE PERIODS ENDED MARCH 31 (Unaudited) 2000 1999 CASH FLOWS FROM OPERATING ACTIVITIES: Net Income $ 386,176 $ 128,252 Adjustments To Reconcile Net Income To Net Cash Provided By Operating Activities: Depreciation 86,690 14,502 Gain on Sale of Real Estate (221,420) 0 Decrease in Receivables 0 2,153 Increase (Decrease) in Payable to AEI Fund Management, Inc. 114,378 (119,124) Increase in Unearned Rent 33,506 5,701 ----------- ----------- Total Adjustments 13,154 (96,768) ----------- ----------- Net Cash Provided By Operating Activities 399,330 31,484 ----------- ----------- CASH FLOWS FROM INVESTING ACTIVITIES: Investments in Real Estate (7,068) (2,268,192) Proceeds from Sale of Real Estate 1,591,381 0 ----------- ----------- Net Cash Provided By (Used For) Investing Activities 1,584,313 (2,268,192) ----------- ----------- CASH FLOWS FROM FINANCING ACTIVITIES: Capital Contributions from Limited Partners 0 972,059 Organization and Syndication Costs 0 (143,883) Increase in Distributions Payable 0 37,843 Distributions to Partners (261,604) (299,320) ----------- ----------- Net Cash Provided By (Used For) Financing Activities (261,604) 566,699 ----------- ----------- NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 1,722,039 (1,670,009) CASH AND CASH EQUIVALENTS, beginning of period 247,401 10,206,442 ----------- ----------- CASH AND CASH EQUIVALENTS, end of period $ 1,969,440 $ 8,536,433 =========== =========== The accompanying Notes to Financial Statements are an integral part of this statement. AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP STATEMENT OF CHANGES IN PARTNERS' CAPITAL FOR THE PERIODS ENDED MARCH 31 (Unaudited) Limited Partnership General Limited Units Partners Partners Total Outstanding BALANCE, December 31, 1998 $(21,135) $12,917,288 $12,896,153 15,945.16 Capital Contributions 0 972,059 972,059 972.06 Organization and Syndication Costs 0 (143,883) (143,883) Distributions (8,980) (290,340) (299,320) Net Income 3,848 124,404 128,252 --------- ----------- ----------- ----------- BALANCE, March 31, 1999 $(26,267) $13,579,528 $13,553,261 16,917.22 ========= =========== =========== =========== BALANCE, December 31, 1999 $(38,746) $13,176,233 $13,137,487 16,808.18 Distributions (7,848) (253,756) (261,604) Net Income 11,585 374,591 386,176 --------- ----------- ----------- ----------- BALANCE, March 31, 2000 $(35,009) $13,297,068 $13,262,059 16,808.18 ========== =========== =========== =========== The accompanying Notes to Financial Statements are an integral part of this statement. AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP NOTES TO FINANCIAL STATEMENTS MARCH 31, 2000 (Unaudited) (1) The condensed statements included herein have been prepared by the Partnership, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission, and reflect all adjustments which are, in the opinion of management, necessary to a fair statement of the results of operations for the interim period, on a basis consistent with the annual audited statements. The adjustments made to these condensed statements consist only of normal recurring adjustments. Certain information, accounting policies, and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Partnership believes that the disclosures are adequate to make the information presented not misleading. It is suggested that these condensed financial statements be read in conjunction with the financial statements and the summary of significant accounting policies and notes thereto included in the Partnership's latest annual report on Form 10-KSB. (2) Organization - AEI Income & Growth Fund XXII Limited Partnership (Partnership) was formed to acquire and lease commercial properties to operating tenants. The Partnership's operations are managed by AEI Fund Management XXI, Inc. (AFM), the Managing General Partner. Robert P. Johnson, the President and sole shareholder of AFM, serves as the Individual General Partner and an affiliate of AFM, AEI Fund Management, Inc. (AEI), performs the administrative and operating functions for the Partnership. The terms of the Partnership offering call for a subscription price of $1,000 per Limited Partnership Unit, payable on acceptance of the offer. The Partnership commenced operations on May 1, 1997 when minimum subscriptions of 1,500 Limited Partnership Units ($1,500,000) were accepted. The offering terminated January 9, 1999 when the extended offering period expired. The Partnership received subscriptions for 16,917.222 Limited Partnership Units ($16,917,222). Under the terms of the Limited Partnership Agreement, the Limited Partners and General Partners contributed funds of $16,917,222 and $1,000, respectively. During operations, any Net Cash Flow, as defined, which the General Partners determine to distribute will be distributed 97% to the Limited Partners and 3% to the General Partners. Distributions to Limited Partners will be made pro rata by Units. Any Net Proceeds of Sale, as defined, from the sale or financing of properties which the General Partners determine to distribute will, after provisions for debts and reserves, be paid in the following manner: (i) first, 99% to the Limited Partners and 1% to the General Partners until the Limited Partners receive an amount equal to: (a) their Adjusted Capital Contribution plus (b) an amount equal to 9% of their Adjusted Capital Contribution per annum, cumulative but not compounded, to the extent not previously distributed from Net Cash Flow; (ii) any remaining balance will be distributed 90% to the Limited Partners and 10% to the General Partners. Distributions to the Limited Partners will be made pro rata by Units. AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP NOTES TO FINANCIAL STATEMENTS (Continued) (2) Organization - (Continued) For tax purposes, profits from operations, other than profits attributable to the sale, exchange, financing, refinancing or other disposition of property, will be allocated first in the same ratio in which, and to the extent, Net Cash Flow is distributed to the Partners for such year. Any additional profits will be allocated in the same ratio as the last dollar of Net Cash Flow is distributed. Net losses from operations will be allocated 99% to the Limited Partners and 1% to the General Partners. For tax purposes, profits arising from the sale, financing, or other disposition of property will be allocated in accordance with the Partnership Agreement as follows: (i) first, to those partners with deficit balances in their capital accounts in an amount equal to the sum of such deficit balances; (ii) second, 99% to the Limited Partners and 1% to the General Partners until the aggregate balance in the Limited Partners' capital accounts equals the sum of the Limited Partners' Adjusted Capital Contributions plus an amount equal to 9% of their Adjusted Capital Contributions per annum, cumulative but not compounded, to the extent not previously allocated; (iii) third, the balance of any remaining gain will then be allocated 90% to the Limited Partners and 10% to the General Partners. Losses will be allocated 98% to the Limited Partners and 2% to the General Partners. The General Partners are not required to currently fund a deficit capital balance. Upon liquidation of the Partnership or withdrawal by a General Partner, the General Partners will contribute to the Partnership an amount equal to the lesser of the deficit balances in their capital accounts or 1% of total Limited Partners' and General Partners' capital contributions. (3) Investments in Real Estate - On June 29, 1998, the Partnership purchased a parcel of land in Centerville, Ohio for $1,850,988. On August 28, 1998, the Partnership assigned, for diversification purposes, 77% of its interest in the property to three affiliated partnerships. The land is leased to Americana Dining Corporation (ADC) under a Lease Agreement with a primary term of 20 years and annual rental payments of $29,801. Effective December 25, 1998, the annual rent was increased to $44,701. Simultaneously with the purchase of the land, the Partnership entered into a Development Financing Agreement under which the Partnership advanced funds to ADC for the construction of a Champps Americana restaurant on the site. Initially, the Partnership charged interest on the advances at a rate of 7.0%. Effective December 25, 1998, the interest rate was increased to 10.5%. On January 27, 1999, after the development was completed, the Lease Agreement was amended to require annual rental payments of $93,256. The Partnership's share of total acquisition costs, including the cost of the land, was $924,843. The remaining interests in the property are owned by AEI Real Estate Fund XVII Limited Partnership, AEI Real Estate Fund XVIII Limited Partnership and AEI Income & Growth Fund XXI Limited Partnership, affiliates of the Partnership. AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP NOTES TO FINANCIAL STATEMENTS (Continued) (3) Investments in Real Estate - (Continued) On November 20, 1998, the Partnership purchased a parcel of land in Homewood, Alabama for $696,000. The land is leased to RTM Alabama, Inc. (RTM) under a Lease Agreement with a primary term of 20 years and annual rental payments of $46,980. Simultaneously with the purchase of the land, the Partnership entered into a Development Financing Agreement under which the Partnership advanced funds to RTM for the construction of an Arby's restaurant on the site. The Partnership charged interest on the advances at a rate of 6.75%. On July 9, 1999, after the development was completed, the Lease Agreement was amended to require annual rental payments of $87,135. Total acquisition costs, including the cost of the land, were $1,392,592. On November 25, 1998, the Partnership purchased a parcel of land in Fort Wayne, Indiana for $470,000. The land is leased to Tumbleweed, Inc. (TWI) under a Lease Agreement with a primary term of 15 years and annual rental payments of $39,950. Effective March 24, 1999, the annual rent was increased to $48,175. Simultaneously with the purchase of the land, the Partnership entered into a Development Financing Agreement under which the Partnership advanced funds to TWI for the construction of a Tumbleweed restaurant on the site. Initially, the Partnership charged interest on the advances at a rate of 8.5%. Effective March 24, 1999, the interest rate was increased to 10.25%. On August 31, 1999, after the development was completed, the Lease Agreement was amended to require annual rental payments of $130,941. Total acquisition costs, including the cost of the land, were $1,316,695. On January 26, 1999, the Partnership purchased a Hollywood Video store in Saraland, Alabama for $1,377,891. The property is leased to Hollywood Entertainment Corp. under a Lease Agreement with a primary term of 15 years and annual rental payments of $129,617. On July 14, 1999, the Partnership purchased four Children's World daycare centers located in Abingdon, Maryland, Houston, Texas, Pearland, Texas and DePere, Wisconsin. The properties were purchased for $1,051,772, $892,219, $943,415 and $1,187,452, respectively. The properties are leased to ARAMARK Educational Resources, Inc. under Lease Agreements with primary terms of 15 years and annual rental payments of $91,677, $79,093, $83,635 and $106,157, respectively. On July 16, 1999, the Partnership purchased a Hollywood Video store in Minot, North Dakota for $1,330,000. The property is leased to Hollywood Entertainment Corporation under a Lease Agreement with a primary term of 15 years and annual rental payments of $129,168. On August 26, 1999, the Partnership purchased a Hollywood Video store in Muscle Shoals, Alabama for $1,340,627. The property is leased to Hollywood Entertainment Corporation under a Lease Agreement with a primary term of 15 years and annual rental payments of $129,659. AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP NOTES TO FINANCIAL STATEMENTS (Continued) (3) Investments in Real Estate - (Continued) On September 28, 1999, the Partnership purchased a 53% interest in a Marie Callender's restaurant in Henderson, Nevada for $937,897. The property is leased to Marie Callender Pie Shops, Inc. under a Lease Agreement with a primary term of 15 years and annual rental payments of $85,595. The remaining interest in the property was purchased by AEI Net Lease Income & Growth Fund XIX Limited Partnership, an affiliate of the Partnership. During the three months ended March 31, 2000, the Partnership sold 48.7463% of the Children's World in DePere, Wisconsin in three separate transactions to unrelated third parties. The Partnership received total net sale proceeds of $664,679, which resulted in a total net gain of $97,805. The total cost and related accumulated depreciation of the interests sold was $578,839 and $11,965, respectively. During the three months ended March 31, 2000, the Partnership sold 36.5867% of its interest in the Marie Callender's restaurant in three separate transactions to unrelated third parties. The Partnership received total net sale proceeds of $721,439, which resulted in a total net gain of $80,695. The total cost and related accumulated depreciation of the interests sold was $647,445 and $6,701, respectively. Subsequent to March 31, 2000, the Partnership sold an additional 10.1238% of its interest in the Marie Callender's restaurant to an unrelated third party. The Partnership received net sale proceeds of approximately $195,000, which resulted in a net gain of approximately $18,000. During the three months ended March 31, 2000, the Partnership sold 12.1242% of the Hollywood Video store in Saraland, Alabama to an unrelated third party. The Partnership received total net sale proceeds of $205,263, which resulted in a total net gain of $42,920. The total cost and related accumulated depreciation of the interest sold was $167,058 and $4,715, respectively. Subsequent to March 31, 2000, the Partnership sold an additional 12.5832% of the Hollywood Video store in Saraland, Alabama to an unrelated third party. The Partnership received net sale proceeds of approximately $209,000, which resulted in a net gain of approximately $41,000. During the first three months of 2000, the Partnership distributed $34,582 of the net sale proceeds to the Limited and General Partners as part of their regular quarterly distributions which represented a return of capital of $1.98 per Limited Partnership Unit. The Partnership has incurred net costs of $7,068 relating to the review of potential property acquisitions which have been capitalized and will be allocated to properties acquired in future periods. AEI INCOME & GROWTH FUND XXII LIMITED PARTNERSHIP NOTES TO FINANCIAL STATEMENTS (Continued) (4) Payable to AEI Fund Management, Inc. - AEI Fund Management, Inc. performs the administrative and operating functions for the Partnership. The payable to AEI Fund Management represents the balance due for those services. This balance is non-interest bearing and unsecured and is to be paid in the normal course of business. ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS Results of Operations For the three months ended March 31, 2000 and 1999, the Partnership recognized rental income of $298,260 and $82,627, respectively. During the same periods, the Partnership earned $6,180 and $112,245, respectively, in investment income from subscription proceeds which were invested in short-term money market accounts. This investment income constituted 2% and 58%, respectively, of total income. The percentage of total income represented by investment income declines as subscription proceeds are invested in properties. During the three months ended March 31, 2000 and 1999, the Partnership paid Partnership administration expenses to affiliated parties of $39,026 and $43,213, respectively. These administration expenses include costs associated with the management of the properties, processing distributions, reporting requirements and correspondence to the Limited Partners. During the same period, the Partnership incurred Partnership administration and property management expenses from unrelated parties of $13,968 and $8,905, respectively. These expenses represent direct payments to third parties for legal and filing fees, direct administrative costs, outside audit and accounting costs, taxes, insurance and other property costs. As of March 31, 2000, the Partnership's cash distribution rate was 6.0% on an annualized basis. Pursuant to the Partnership Agreement, distributions of Net Cash Flow and Net Income were allocated 97% to the Limited Partners and 3% to the General Partners. Since the Partnership has only recently purchased its real estate, inflation has had a minimal effect on income from operations. The Leases may contain cost of living increases which will result in an increase in rental income over the term of the Leases. Inflation also may cause the Partnership's real estate to appreciate in value. However, inflation and changing prices may also have an adverse impact on the operating margins of the properties' tenants which could impair their ability to pay rent and subsequently reduce the Partnership's Net Cash Flow available for distributions. Liquidity and Capital Resources During the three months ended March 31, 2000, the Partnership's cash balances increased $1,722,039 mainly as a result of cash generated from the sale of property. Net cash provided by operating activities increased from $31,484 in 1999 to $399,330 in 2000 as a result of an increase in income in 2000 and net timing differences in the collection of payments from the lessees and the payment of expenses. ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued) The major components of the Partnership's cash flow from investing activities are investments in real estate and proceeds from the sale of real estate. During the three months ended March 31, 2000 and 1999, the Partnership expended $7,068 and $2,268,192, respectively, to invest in real properties (inclusive of acquisition expenses). During the three months ended March 31, 2000, the Partnership generated cash flow from the sale of real estate of $1,591,381. On June 29, 1998, the Partnership purchased a parcel of land in Centerville, Ohio for $1,850,988. On August 28, 1998, the Partnership assigned, for diversification purposes, 77% of its interest in the property to three affiliated partnerships. The land is leased to Americana Dining Corporation (ADC) under a Lease Agreement with a primary term of 20 years and annual rental payments of $29,801. Effective December 25, 1998, the annual rent was increased to $44,701. Simultaneously with the purchase of the land, the Partnership entered into a Development Financing Agreement under which the Partnership advanced funds to ADC for the construction of a Champps Americana restaurant on the site. Initially, the Partnership charged interest on the advances at a rate of 7.0%. Effective December 25, 1998, the interest rate was increased to 10.5%. On January 27, 1999, after the development was completed, the Lease Agreement was amended to require annual rental payments of $93,256. The Partnership's share of total acquisition costs, including the cost of the land, was $924,843. The remaining interests in the property are owned by AEI Real Estate Fund XVII Limited Partnership, AEI Real Estate Fund XVIII Limited Partnership and AEI Income & Growth Fund XXI Limited Partnership, affiliates of the Partnership. On November 20, 1998, the Partnership purchased a parcel of land in Homewood, Alabama for $696,000. The land is leased to RTM Alabama, Inc. (RTM) under a Lease Agreement with a primary term of 20 years and annual rental payments of $46,980. Simultaneously with the purchase of the land, the Partnership entered into a Development Financing Agreement under which the Partnership advanced funds to RTM for the construction of an Arby's restaurant on the site. The Partnership charged interest on the advances at a rate of 6.75%. On July 9, 1999, after the development was completed, the Lease Agreement was amended to require annual rental payments of $87,135. Total acquisition costs, including the cost of the land, were $1,392,592. On November 25, 1998, the Partnership purchased a parcel of land in Fort Wayne, Indiana for $470,000. The land is leased to Tumbleweed, Inc. (TWI) under a Lease Agreement with a primary term of 15 years and annual rental payments of $39,950. Effective March 24, 1999, the annual rent was increased to $48,175. Simultaneously with the purchase of the land, the Partnership entered into a Development Financing Agreement under which the Partnership advanced funds to TWI for the construction of a Tumbleweed restaurant on the site. Initially, the Partnership charged interest on the advances at a rate of 8.5%. Effective March 24, 1999, the interest rate was increased to 10.25%. On August 31, 1999, after the development was completed, the Lease Agreement was amended to require annual rental payments of $130,941. Total acquisition costs, including the cost of the land, were $1,316,695. On January 26, 1999, the Partnership purchased a Hollywood Video store in Saraland, Alabama for $1,377,891. The property is leased to Hollywood Entertainment Corp. under a Lease Agreement with a primary term of 15 years and annual rental payments of $129,617. ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued) On July 14, 1999, the Partnership purchased four Children's World daycare centers located in Abingdon, Maryland, Houston, Texas, Pearland, Texas and DePere, Wisconsin. The properties were purchased for $1,051,772, $892,219, $943,415 and $1,187,452, respectively. The properties are leased to ARAMARK Educational Resources, Inc. under Lease Agreements with primary terms of 15 years and annual rental payments of $91,677, $79,093, $83,635 and $106,157, respectively. On July 16, 1999, the Partnership purchased a Hollywood Video store in Minot, North Dakota for $1,330,000. The property is leased to Hollywood Entertainment Corporation under a Lease Agreement with a primary term of 15 years and annual rental payments of $129,168. On August 26, 1999, the Partnership purchased a Hollywood Video store in Muscle Shoals, Alabama for $1,340,627. The property is leased to Hollywood Entertainment Corporation under a Lease Agreement with a primary term of 15 years and annual rental payments of $129,659. On September 28, 1999, the Partnership purchased a 53% interest in a Marie Callender's restaurant in Henderson, Nevada for $937,897. The property is leased to Marie Callender Pie Shops, Inc. under a Lease Agreement with a primary term of 15 years and annual rental payments of $85,595. The remaining interest in the property was purchased by AEI Net Lease Income & Growth Fund XIX Limited Partnership, an affiliate of the Partnership. During the three months ended March 31, 2000, the Partnership sold 48.7463% of the Children's World in DePere, Wisconsin in three separate transactions to unrelated third parties. The Partnership received total net sale proceeds of $664,679, which resulted in a total net gain of $97,805. The total cost and related accumulated depreciation of the interests sold was $578,839 and $11,965, respectively. During the three months ended March 31, 2000, the Partnership sold 36.5867% of its interest in the Marie Callender's restaurant in three separate transactions to unrelated third parties. The Partnership received total net sale proceeds of $721,439, which resulted in a total net gain of $80,695. The total cost and related accumulated depreciation of the interests sold was $647,445 and $6,701, respectively. Subsequent to March 31, 2000, the Partnership sold an additional 10.1238% of its interest in the Marie Callender's restaurant to an unrelated third party. The Partnership received net sale proceeds of approximately $195,000, which resulted in a net gain of approximately $18,000. During the three months ended March 31, 2000, the Partnership sold 12.1242% of the Hollywood Video store in Saraland, Alabama to an unrelated third party. The Partnership received total net sale proceeds of $205,263, which resulted in a total net gain of $42,920. The total cost and related accumulated depreciation of the interest sold was $167,058 and $4,715, respectively. Subsequent to March 31, 2000, the Partnership sold an additional 12.5832% of the Hollywood Video store in Saraland, Alabama to an unrelated third party. The Partnership received net sale proceeds of approximately $209,000, which resulted in a net gain of approximately $41,000. ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued) During the first three months of 2000, the Partnership distributed $34,582 of the net sale proceeds to the Limited and General Partners as part of their regular quarterly distributions which represented a return of capital of $1.98 per Limited Partnership Unit. The Partnership's primary use of cash flow is distribution and redemption payments to Partners. The Partnership declares its regular quarterly distributions before the end of each quarter and pays the distribution in the first week after the end of each quarter. The Partnership attempts to maintain a stable distribution rate from quarter to quarter. Redemption payments are paid to redeeming Partners on a semi-annual basis. The Partnership may acquire Units from Limited Partners who have tendered their Units to the Partnership. Such Units may be acquired at a discount. The Partnership is not obligated to purchase in any year more than 5% of the number of Units outstanding at the beginning of the year. In no event shall the Partnership be obligated to purchase Units if, in the sole discretion of the Managing General Partner, such purchase would impair the capital or operation of the Partnership. On April 1, 2000, two Limited Partners redeemed a total of 9.67 Partnership Units for $7,099 in accordance with the Partnership Agreement. The Partnership acquired these Units using Net Cash Flow from operations. In 1999, four Limited Partners redeemed a total of 109.04 Partnership Units for $87,231. The redemptions increase the remaining Limited Partners' ownership interest in the Partnership. The continuing rent payments from the properties, together with cash generated from property sales, should be adequate to fund continuing distributions and meet other Partnership obligations on both a short-term and long-term basis. ITEM 2.MANAGEMENT'S DISCUSSION AND ANALYSIS (Continued) Cautionary Statement for Purposes of the "Safe Harbor" Provisions of the Private Securities Litigation Reform Act of 1995 The foregoing Management's Discussion and Analysis contains various "forward looking statements" within the meaning of federal securities laws which represent management's expectations or beliefs concerning future events, including statements regarding anticipated application of cash, expected returns from rental income, growth in revenue, taxation levels, the sufficiency of cash to meet operating expenses, rates of distribution, and other matters. These, and other forward looking statements made by the Partnership, must be evaluated in the context of a number of factors that may affect the Partnership's financial condition and results of operations, including the following: Market and economic conditions which affect the value of the properties the Partnership owns and the cash from rental income such properties generate; the federal income tax consequences of rental income, deductions, gain on sales and other items and the affects of these consequences for investors; resolution by the General Partners of conflicts with which they may be confronted; the success of the General Partners of locating properties with favorable risk return characteristics; the effect of tenant defaults; and the condition of the industries in which the tenants of properties owned by the Partnership operate. PART II - OTHER INFORMATION ITEM 1.LEGAL PROCEEDINGS There are no material pending legal proceedings to which the Partnership is a party or of which the Partnership's property is subject. ITEM 2.CHANGES IN SECURITIES None. ITEM 3.DEFAULTS UPON SENIOR SECURITIES None. ITEM 4.SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS None ITEM 5.OTHER INFORMATION None. PART II - OTHER INFORMATION (Continued) ITEM 6.EXHIBITS AND REPORTS ON FORM 8-K a. Exhibits - Description 10.1 Purchase Agreement dated March 16, 2000 between the Partnership and George M. Kunitake and Kay H. Kunitake, husband and wife, and Steven T. Kunitake relating to the property at 1553 Arcadian Drive, DePere, Wisconsin. 10.2 Property Co-Tenancy Ownership Agreement dated March 24, 2000 between the Partnership and George M. Kunitake and Kay H. Kunitake, husband and wife, and Steven T. Kunitake relating to the property at 1553 Arcadian Drive, DePere, Wisconsin. 10.3 Purchase Agreement dated March 27, 2000 between the Partnership and the Carl R. Whittington Trust relating to the property at 1553 Arcadian Drive, DePere, Wisconsin. 10.4 Purchase Agreement dated March 27, 2000 between the Partnership and the Carl R. Whittington Trust relating to the property at 530 North Stephanie Street, Henderson, Nevada. 10.5 Purchase Agreement dated March 27, 2000 between the Partnership and the Carl R. Whittington Trust relating to the property at 1097 Industrial Parkway, Saraland, Alabama. 10.6 Property Co-Tenancy Ownership Agreement dated March 30, 2000 between the Partnership and the Carl R. Whittington Trust relating to the property at 1097 Industrial Parkway, Saraland, Alabama. 10.7 Property Co-Tenancy Ownership Agreement dated March 30, 2000 between the Partnership and the Carl R. Whittington Trust relating to the property at 1553 Arcadian Drive, DePere, Wisconsin. 10.8 Purchase Agreement dated April 13, 2000 between the Partnership and Francis E. Quinn and Cecile Ann Quinn relating to the property at 530 North Stephanie Street, Henderson, Nevada. 10.9 Purchase Agreement dated April 18, 2000 between the Partnership and the Wuest Estate Company relating to the property at 1097 Industrial Parkway, Saraland, Alabama. PART II - OTHER INFORMATION (Continued) ITEM 6.EXHIBITS AND REPORTS ON FORM 8-K (Continued) a. Exhibits - Description 10.10 Property Co-Tenancy Ownership Agreement dated April 21, 2000 between the Partnership and the Wuest Estate Company relating to the property at 1097 Industrial Parkway, Saraland, Alabama. 27 Financial Data Schedule for period ended March 31, 2000. b. Reports filed on Form 8-K - None. SIGNATURES In accordance with the requirements of the Exchange Act, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Dated: May 5, 2000 AEI Income & Growth Fund XXII Limited Partnership By: AEI Fund Management XXI, Inc. Its: Managing General Partner By: /s/ Robert P. Johnson Robert P. Johnson President (Principal Executive Officer) By: /s/ Mark E. Larson Mark E. Larson Chief Financial Officer (Principal Accounting Officer) EX-10.1 2 PURCHASE AGREEMENT Children's World - DePere, WI This AGREEMENT, entered into effective as of the 16th of March, 2000. l. PARTIES. Seller is AEI Income & Growth Fund XXII Limited Partnership which owns an undivided 82.7896% interest in the fee title to that certain real property legally described in the attached Exhibit "A" (the "Entire Property") Buyer is George M. Kunitake and Kay H. Kunitake, husband and wife as joint tenants, and Steven T. Kunitake, a married man as his sole and separate property, all as joint tenants ("Buyer"). Seller wishes to sell and Buyer wishes to buy a portion as Tenant in Common of Seller's interest in the Entire Property. 2. PROPERTY. The Property to be sold to Buyer in this transaction consists of an undivided 16.7323 percentage interest (hereinafter, simply the "Property") as Tenant in Common in the Entire Property. 3. PURCHASE PRICE. The purchase price for this percentage interest in the Entire Property is $245,000, all cash. 4. TERMS. The purchase price for the Property will be paid by Buyer as follows: (a) When this agreement is executed, Buyer will pay $5,000 to Seller (which shall be deposited into escrow according to the terms hereof) (the "First Payment"). The First Payment will be credited against the purchase price when and if escrow closes and the sale is completed. (b) Buyer will deposit the balance of the purchase price, $240,000 (the "Second Payment") into escrow in sufficient time to allow escrow to close on the closing date. 5. CLOSING DATE. Escrow shall close on or before March 31, 2000. 6. DUE DILIGENCE. Buyer will have until the expiration of the fifth business day (The "Review Period") 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 Entire Property or persons caused by Buyer or its agents arising out of such physical inspections of the Entire Property. (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/ GMR by STK, /s/ KHK by STK, /s/ STK Purchase Agreement for Children's World, DePere, WI (c) Copies of an "as built" survey of the Entire Property done concurrent with Seller's acquisition of the Property. (d) Lease (as further set forth in paragraph 11(a) below) of the Entire Property showing occupancy date, lease expiration date, rent, and Guarantys, if any, accompanied by such tenant financial statements as may have been provided most recently to Seller by the Tenant and/or Guarantors. It is a contingency upon Seller's obligations hereunder that two (2) copies of Co-Tenancy Agreement in the form attached hereto duly executed by Buyer and Seller and dated on escrow closing date be delivered to the Seller on the closing date. 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. If this Agreement is not cancelled as set forth above, the First Payment shall be non-refundable unless Seller shall default hereunder. If Buyer cancels this Agreement as permitted under this Section, except for any escrow cancellation fees and any liabilities under the first paragraph of section 6 of this agreement (which will survive), Buyer (after execution of such documents reasonably requested by Seller to evidence the termination hereof) shall be returned its First Payment, and 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 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 a nationally-recognized escrow company selected by Seller. 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 commitment of a title company selected by Seller 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 insurable title to the Property subject only to: the title company's standard exceptions; current real property taxes and assessments; survey Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK Purchase Agreement for Children's World, DePere, WI exceptions; the rights of parties in possession pursuant to the lease defined in paragraph 11 below; all matters of public record; and other items 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 insurable 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. Pending correction of title, the payments hereunder required shall be postponed, but upon correction of title and within ten (10) days after written notice of correction to the Buyer, the parties shall perform this Agreement according to its terms. 9. CLOSING COSTS. Seller will pay one-half of escrow fees, the cost of the title commitment and any brokerage commissions payable. 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 all recording fees, one-half of the escrow fees, and the cost of an update to the Survey in Sellers possession (if an update is required by Buyer.) 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 Entire Property (of which the Property is a part) 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. Unpaid real estate taxes and unpaid levied and pending special assessments for the year of Closing shall be the responsibility of Buyer and Seller in proportion to their respective Tenant in Common interests, pro-rated, however, to the date of closing for the period prior to closing, which shall be the responsibility of Seller if Tenant shall not pay the same. Seller and Buyer shall likewise pay all taxes due and payable in the year after Closing and any unpaid installments of special assessments payable therewith and thereafter, if such unpaid levied and pending special assessments and real estate taxes are not paid by any tenant of the Entire Property. (b) All income and all operating expenses from the Entire 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 its proportionate share of all income earned Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK Purchase Agreement for Children's World, DePere, WI and shall be responsible for its proportionate share of all operating expenses of the Entire 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 Net Lease Agreement in existence between AEI Income & Growth Fund XXII Limited Partnership and ARAMARK Educational Resources, Inc., f/k/a Children's World Learning Centers, Inc., dated July 14, 1999, Seller is not aware of any leases of the Property. (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. However, Buyer acknowledges that Seller retains the right both prior to and after the Closing Date to freely transfer all or a portion of Seller's remaining undivided interest in the Entire Property, provided such sale shall not encumber the Property being purchased by Buyer in violation of the terms hereof or the contemplated Co-Tenancy Agreement. 12. DISCLOSURES. (a) To the best of Seller's knowledge: there are now, and at the Closing there will be, no 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) To the best of Seller's knowledge: the use and operation of the Property now is, and at the time of Closing will be, 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. Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK Purchase Agreement for Children's World, DePere, WI (d) To the best of Seller's knowledge: the Property is not, and as of the Closing will not be, 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 as provided under applicable state or federal laws or regulations. (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. (f) BUYER ACKNOWLEDGES THAT, HAVING BEEN GIVEN THE OPPORTUNITY TO INSPECT THE PROPERTY AND SUCH FINANCIAL INFORMATION ON THE LESSEE AND GUARANTORS OF THE LEASE AS BUYER OR ITS ADVISORS SHALL REQUEST, 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 FURTHER ACKNOWLEDGES THAT THE INFORMATION PROVIDED AND TO BE PROVIDED BY SELLER WITH RESPECT TO THE PROPERTY AND TO THE LESSEE AND GUARANTORS OF LEASE WAS OBTAINED FROM A VARIETY OF SOURCES AND SELLER NEITHER (A) HAS MADE INDEPENDENT INVESTIGATION OR VERIFICATION OF SUCH INFORMATION, OR (B) MAKES ANY REPRESENTATIONS AS TO THE ACCURACY OR COMPLETENESS OF SUCH INFORMATION. THE SALE OF THE PROPERTY AS PROVIDED FOR HEREIN IS MADE ON AN "AS IS" BASIS, AND BUYER EXPRESSLY ACKNOWLEDGES THAT, IN CONSIDERATION OF THE AGREEMENTS OF 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 OR CONDITION, HABITABILITY, TENANTABILITY, SUITABILITY FOR COMMERCIAL PURPOSES, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE, IN RESPECT OF THE PROPERTY. The provisions (d) - (f) above shall survive closing. 13. CLOSING. (a) Before the closing date, Seller will deposit into escrow an executed limited warranty deed conveying insurable title of the Property to Buyer, subject to the encumbrances contained in paragraph 8 above. (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, Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK Purchase Agreement for Children's World, DePere, WI (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 and Seller will be relieved of all obligations and will be entitled to retain all monies heretofore paid by the Buyer. In addition, Seller shall retain all remedies available to Seller at law or in equity. 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 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 Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK Purchase Agreement for Children's World, DePere, WI 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 is 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 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 ten-day period provided for above in this Subparagraph 16a 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 (pro-rata in relation to the Entire Property) resulting from said damage or destruction to the extent that the same are payable with respect to damage to the Property, subject to rights of any Tenant of the Entire Property. If the cost of repair is less than $10,000.00, 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 pro-rata in relation to the Entire Property, subject to rights of any Tenant of the Entire Property. (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. 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 the Seller's right, title, and interest in and to any award made, or to be made, in the condemnation proceeding pro-rata in relation to the Entire Property, subject to rights of any Tenant of the Entire Property. 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). Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK Purchase Agreement for Children's World, DePere, WI 17. BUYER'S 1031 TAX FREE EXCHANGE. While Seller acknowledges that Buyer is purchasing the Property as "replacement property" to accomplish a tax free exchange, Buyer acknowledges that Seller has made no representations, warranties, or agreements to Buyer or Buyer's agents that the transaction contemplated by the Agreement will qualify for such tax treatment, nor has there been any reliance thereon by Buyer respecting the legal or tax implications of the transactions contemplated hereby. Buyer further represents that it has sought and obtained such third party advice and counsel as it deems necessary in regards to the tax implications of this transaction. Buyer wishes to novate/assign the ownership rights and interest of this Purchase Agreement to First Guaranty Exchange which will act as Accommodator to perfect the 1031 exchange by preparing an agreement of exchange of Real Property whereby First Guaranty Exchange will be an independent third party purchasing the ownership interest in subject property from Seller and selling the ownership interest in subject property to Buyer under the same terms and conditions as documented in this Purchase Agreement. Buyer asks the Seller, and Seller agrees to cooperate in the perfection of such an exchange if at no additional cost or expense to Seller or delay in time. Buyer hereby indemnifies and holds Seller harmless from any claims and/or actions resulting from said exchange. Pursuant to the direction of First Guaranty Exchange, Seller will deed the Property to Buyer. 18. 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 10 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 10 days following the delivery of the notice to the escrow agent, this Contract shall be cancelled. 19. 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. Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK Purchase Agreement for Children's World, DePere, WI (b) If this escrow has not closed by March 31, 2000, through no fault of Seller, Seller may either, at its election, extend the closing date or exercise any remedy available to it by law, including terminating this Agreement. (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 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: Robert P. Johnson AEI Income & Growth Fund XXII Limited Partnership 1300 Minnesota World Trade Center 30 E. 7th Street St. Paul, MN 55101 If to Buyer: George M. and Kay H. Kunitake Steven T. Kunitake 153 Exeter San Carlos, CA 94070 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. REST OF PAGE INTENTIONALLY LEFT BLANK Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK Purchase Agreement for Children's World, DePere, WI IN WITNESS WHEREOF, the Seller and Buyer have executed this Agreement effective as of the day and year above first written. BUYER: George M. Kunitake and Kay H. Kunitake, husband and wife as joint tenants, and Steven T. Kunitake, a married man as his sole and separate property, all as joint tenants By: /s/ George M Kunitake by Steven T Kunitake his atty in fact George M. Kunitake By: /s/ Kay H Kunitake by Steven T Kunitake her atty in fact Kay H. Kunitake By: /s/ Steven T Kunitake Steven T. Kunitake WITNESS: (as to all signers) /s/ Mary Kunitake Mary Kunitake (Print Name) SELLER: AEI Income & Growth Fund XXII Limited Partnership, a Minnesota limited partnership By: AEI Fund Management XXI, Inc., its corporate general partner By:/s/ Robert P Johnson Robert P. Johnson, President WITNESS: /s/ Jill Rayburn Jill Rayburn (Print Name) Buyer Initial: /s/ GMR by STK, /s/ KHK by STK, /s/ STK Purchase Agreement for Children's World, DePere, WI EXHIBIT "A" LEGAL DESCRIPTION All of Lot One (1) of Volumnet 34 Certified Survey Maps, Page 125, Brown County Records, and is located in part of Government Lots 1 and 2, Section Thirty-five (35) and part of Government Lot 1 and part of the Southeast One-quarter of the Northeast, One-quarter (SE 1/4 - NE 1/4), Section Thirty-four (34), all being in Township Twenty-three (23) North, Range Twenty (20) East, in the Town of Ledgeview, Brown County, Wisconsin. and Part of Lot One (1) of Volume 30 Certified Survey Maps, Page 71, Brown County Records, being part of Government Lots 1 and 2, Section Thirty-five (35), Township Twenty-three (23) North, Range Twenty (20) East, in the Town of Ledgeview, Brown County, Wisconsin, more fully described as follows: Commencing at the West 1/4 corner, Section 35, T23N, R20E; thence N01 36' 23" West, 1763.33 feet along the West line of said Section 35, to the South right-of- way of Heritage Road, also known as C.T.H. "X"'; thence N89 02'44" East, 82.54 feet along said right-of-way to the point of beginning; thence N89 02'44" East 53.61 feet along said right-of-way; thence 167.98 feet along said right-of-way, being the arc of a 1095.92 foot radius curve to the right, whose long chord bears S86 33'48" East, 167.82 feet; thence S1 36' 23" East, 539.93 feet along the East line of Lot 1, Volume 30 Certified Survey Maps, Page 71, Brown County Records, to the North right-of-way of Swan Road; thence S88 33' 16" West, 220.77 feet along said right-of-way; thence N 1 36' 23" West, 554.67 feet along the East line of Lot 1, Volume 34 Certified Survey Maps, Page 125, Brown County Records, to the point of beginning. Tax Parcel No. D-50-1 and D-84-1 Arcadian Lane/Heritage Road De Pere, WI 54115 EX-10.2 3 PROPERTY CO-TENANCY OWNERSHIP AGREEMENT (Children's World - DePere, WI) THIS CO-TENANCY AGREEMENT, Made and entered into as of the 24th day of March, 2000, by and between George M. Kunitake and Kay H. Kunitake, husband and wife as joint tenants, and Steven T. Kunitake, a married man as his sole and separate property, all as joint tenants (hereinafter called "Kunitake") and AEI Income & Growth Fund XXII Limited Partnership (hereinafter called "Fund XXII") (Kunitake, Fund XXII (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 66.0573% interest in and to, and Kunitake presently owns an undivided 16.7323% interest in and to, and D & R Family Limited Partnership presently owns an undivided 17.2104% interest in and to the land situated in the City of DePere, County of Brown and State of WI, (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 operation and management of the Premises and Kunitake's interest by Fund XXII; the continued leasing of space within the Premises; for the distribution of income from and the pro-rata sharing in expenses of the Premises. NOW THEREFORE, in consideration of the purchase by Kunitake 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. The operation and management of the Premises shall be delegated to Fund XXII, or its designated agent, successors or assigns. Provided, however, if Fund XXII shall sell all of its interest in the Premises, the duties and obligations of Fund XXII respecting management of the Premises as set forth herein, including but not limited to paragraphs 2, 3, and 4 hereof, shall be exercised by the holder or holders of a majority undivided co- tenancy interest in the Premises. Except as hereinafter expressly provided to the contrary, each of the parties hereto agrees to be bound by the decisions of Fund XXII with respect to all administrative, operational and management matters of the property comprising the Premises, including but not limited to the management of the net lease agreement for the Premises. The parties hereto hereby designate Fund XXII as their sole and exclusive agent to deal with, and Fund XXII retains the sole right to deal with, any property agent or tenant and to monitor, execute and enforce the terms of leases of space within the Premises, including but not limited to any amendments, consents to assignment, sublet, releases or modifications to leases or guarantees of lease or easements affecting the Co-Tenant Initial: /s/ GMR by STK, /s/ KHK by STK /s/ STK Co-Tenancy Agreement for Children's World, DePere, WI Premises, on behalf of Kunitake. As long as Fund XXII owns an interest in the Premises, only Fund XXII may obligate Kunitake with respect to any expense for the Premises. As further set forth in paragraph 2 hereof, Fund XXII agrees to require any lessee of the Premises to name Kunitake as an insured or additional insured in all insurance policies provided for, or contemplated by, any lease on the Premises. Fund XXII 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, Fund XXII 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. Fund XXII may offset against, pay to itself and deduct from any payment due to Kunitake under this Agreement, and may pay to itself the amount of Kunitake's share of any legitimate expenses of the Premises which are not paid by Kunitake to Fund XXII or its assigns, within ten (10) days after demand by Fund XXII. In the event there is insufficient operating income from which to deduct Kunitake's unpaid share of operating expenses, Fund XXII 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 Tenant under terms of any lease agreement of the Premises. Kunitake has no requirement to, but has, nonetheless elected to retain, and agrees to annually reimburse, Fund XXII in the amount of $600 for the expenses, direct and indirect, incurred by Fund XXII in providing Kunitake with quarterly accounting and distributions of Kunitake 's share of net income and for tracking, reporting and assessing the calculation of Kunitake 's share of operating expenses incurred from the Premises. This invoice amount shall be pro-rated for partial years and Kunitake authorizes Fund XXII to deduct such amount from Kunitake 's share of revenue from the Premises. Kunitake 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; however, enforcement of all other provisions of the lease remains the sole right of Fund XXII pursuant to Section 1 hereof. Fund XXII may terminate its obligation under this paragraph upon 30 days notice to Kunitake 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 Fund XXII'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, Fund XXII Co-Tenant Initial: /s/ GMR by STK, /s/ KHK by STK /s/ STK Co-Tenancy Agreement for Children's World, DePere, WI 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, Kunitake shall be entitled to receive 16.7323% 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 therefor from Fund XXII, shall, within fifteen (15) business days after receipt of notice, make payment to Fund XXII 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. 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. 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 property management 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 July 14, 2029 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. 8. Any notice or election required or permitted to be given or served by any party hereto to, or upon any other, shall be deemed given or served in accordance with the provisions of this Agreement, if said notice or elections addressed as follows; Co-Tenant Initial: /s/ GMR by STK, /s/ KHK by STK /s/ STK Co-Tenancy Agreement for Children's World, DePere, WI If to Fund XXII: AEI Income & Growth Fund XXII Limited Partnership 1300 Minnesota World Trade Center 30 E. Seventh Street St. Paul, Minnesota 55101 If to Kunitake: George M. and Kay H. Kunitake Steven T. Kunitake 153 Exeter San Carlos, CA 94070 If to D & R : Robert DeKlotz, Partner D & R Family Limited Partnership 1760 E. North Hills Drive LaHabra, CA 90631 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. 9. This Agreement shall not create any partnership or joint venture among or between the Co-Tenants or any of them, and 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. Co-Tenant Initial: /s/ GMR by STK, /s/ KHK by STK /s/ STK Co-Tenancy Agreement for Children's World, DePere, WI IN WITNESS WHEREOF, The parties hereto have caused this Agreement to be executed and delivered, as of the day and year first above written. Kunitake: George M. Kunitake and Kay H. Kunitake, husband and wife as joint tenants, and Steven T. Kunitake, a married man as his sole and separate property, all as joint tenants By: /s/ George M Kunitake by Steven T Kunitake his atty in fact George M. Kunitake By: /s/ Kay H Kunitake by Steven T Kunitake her atty in fact Kay H. Kunitake By:/s/ Steven T Kunitake Steven T. Kunitake WITNESS: (as to all signers) /s/ Mary Kunitake Mary Kunitake (Print Name) State of ) ) ss. County of ) I, a Notary Public in and for the state and county of aforesaid, hereby certify there appeared before me this day of 2000, George M. Kunitake, who executed the foregoing instrument in said capacity. Notary Public Co-Tenant Initial: /s/ GMR by STK, /s/ KHK by STK /s/ STK Co-Tenancy Agreement for Children's World, DePere, WI State of ) ) ss. County of ) I, a Notary Public in and for the state and county of aforesaid, hereby certify there appeared before me this day of 2000, Kay H. Kunitake, who executed the foregoing instrument in said capacity. Notary Public State of ) ) ss. County of ) I, a Notary Public in and for the state and county of aforesaid, hereby certify there appeared before me this 15th day of March, 2000, Steven T. Kunitake, who executed the foregoing instrument in said capacity. /s/ Dawn Burton Notary Public [notary seal] Co-Tenant Initial: /s/ GMR by STK, /s/ KHK by STK /s/ STK Co-Tenancy Agreement for Children's World, DePere, WI Fund XXII: AEI Income & Growth Fund XXII Limited Partnership By: AEI Fund Management XXI, Inc., its corporate general partner By:/s/ Robert P Johnson Robert P. Johnson, President WITNESS: /s/ Jill Rayburn Jill Rayburn (Print Name) State of Minnesota ) ) ss. County of Ramsey ) I, a Notary Public in and for the state and county of aforesaid, hereby certify there appeared before me this 24th day of March, 2000, Robert P. Johnson, President of AEI Fund Management XXI Inc., corporate general partner of AEI Income & Growth Fund XXII Limited Partnership, who executed the foregoing instrument in said capacity and on behalf of the corporation in its capacity as corporate general partner, on behalf of said limited partnership. /s/ Barbara J Kochevar Notary Public [notary seal] Co-Tenant Initial: /s/ GMR by STK, /s/ KHK by STK /s/ STK Co-Tenancy Agreement for Children's World, DePere, WI EXHIBIT "A" LEGAL DESCRIPTION All of Lot One (1) of Volumnet 34 Certified Survey Maps, Page 125, Brown County Records, and is located in part of Government Lots 1 and 2, Section Thirty-five (35) and part of Government Lot 1 and part of the Southeast One-quarter of the Northeast, One-quarter (SE 1/4 - NE 1/4), Section Thirty-four (34), all being in Township Twenty-three (23) North, Range Twenty (20) East, in the Town of Ledgeview, Brown County, Wisconsin. and Part of Lot One (1) of Volume 30 Certified Survey Maps, Page 71, Brown County Records, being part of Government Lots 1 and 2, Section Thirty-five (35), Township Twenty-three (23) North, Range Twenty (20) East, in the Town of Ledgeview, Brown County, Wisconsin, more fully described as follows: Commencing at the West 1/4 corner, Section 35, T23N, R20E; thence N01 36' 23" West, 1763.33 feet along the West line of said Section 35, to the South right-of- way of Heritage Road, also known as C.T.H. "X"'; thence N89 02'44" East, 82.54 feet along said right-of-way to the point of beginning; thence N89 02'44" East 53.61 feet along said right-of-way; thence 167.98 feet along said right-of-way, being the arc of a 1095.92 foot radius curve to the right, whose long chord bears S86 33'48" East, 167.82 feet; thence S1 36' 23" East, 539.93 feet along the East line of Lot 1, Volume 30 Certified Survey Maps, Page 71, Brown County Records, to the North right-of-way of Swan Road; thence S88 33' 16" West, 220.77 feet along said right-of-way; thence N 1 36' 23" West, 554.67 feet along the East line of Lot 1, Volume 34 Certified Survey Maps, Page 125, Brown County Records, to the point of beginning. Tax Parcel No. D-50-1 and D-84-1 Arcadian Lane/Heritage Road De Pere, WI 54115 EX-10.3 4 PURCHASE AGREEMENT Children's World - DePere, WI This AGREEMENT, entered into effective as of the 27th of March, 2000. l. PARTIES. Seller is AEI Income & Growth Fund XXII Limited Partnership which owns an undivided 66.0573% interest in the fee title to that certain real property legally described in the attached Exhibit "A" (the "Entire Property") Buyer is Carl R.Whittington, Trustee of the Carl R. Whittington Trust dated October 16, 1996 ("Buyer"). Seller wishes to sell and Buyer wishes to buy a portion as Tenant in Common of Seller's interest in the Entire Property. 2. PROPERTY. The Property to be sold to Buyer in this transaction consists of an undivided 14.8036 percentage interest (hereinafter, simply the "Property") as Tenant in Common in the Entire Property. 3. PURCHASE PRICE. The purchase price for this percentage interest in the Entire Property is $224,500, all cash. 4. TERMS. The purchase price for the Property will be paid by Buyer as follows: (a) When this agreement is executed, Buyer will pay $5,000 to Seller (which shall be deposited into escrow according to the terms hereof) (the "First Payment"). The First Payment will be credited against the purchase price when and if escrow closes and the sale is completed. (b) Buyer will deposit the balance of the purchase price, $219,500 (the "Second Payment") into escrow in sufficient time to allow escrow to close on the closing date. 5. CLOSING DATE. Escrow is anticipated to close on or before March 31, 2000. 6. DUE DILIGENCE. Buyer will have until the expiration of the fifth business day (The "Review Period") 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 Entire Property or persons caused by Buyer or its agents arising out of such physical inspections of the Entire Property. (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. (c) Copies of an "as built" survey of the Entire Property done concurrent with Seller's acquisition of the Property. Buyer Initial: /s/ CRW Purchase Agreement for Children's World, DePere, WI (d) Lease (as further set forth in paragraph 11(a) below) of the Entire Property showing occupancy date, lease expiration date, rent, and Guarantys, if any, accompanied by such tenant financial statements as may have been provided most recently to Seller by the Tenant and/or Guarantors. It is a contingency upon Seller's obligations hereunder that two (2) copies of Co-Tenancy Agreement in the form attached hereto duly executed by Buyer and Seller and dated on escrow closing date be delivered to the Seller on the closing date. 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. If this Agreement is not cancelled as set forth above, the First Payment shall be non-refundable unless Seller shall default hereunder. If Buyer cancels this Agreement as permitted under this Section, except for any escrow cancellation fees and any liabilities under the first paragraph of section 6 of this agreement (which will survive), Buyer (after execution of such documents reasonably requested by Seller to evidence the termination hereof) shall be returned its First Payment, and 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 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 a nationally-recognized escrow company selected by Seller. 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 commitment of a title company selected by Seller 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 insurable 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 Buyer Initial: /s/ CRW Purchase Agreement for Children's World, DePere, WI below; all matters of public record as shown in the title commitment; and other items 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 insurable 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. Pending correction of title, the payments hereunder required shall be postponed, but upon correction of title and within ten (10) days after written notice of correction to the Buyer, the parties shall perform this Agreement according to its terms. 9. CLOSING COSTS. Seller will pay one-half of escrow fees, the cost of the title commitment and any brokerage commissions payable. 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 all recording fees, one-half of the escrow fees, and the cost of an update to the Survey in Sellers possession (if an update is required by Buyer.) 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 Entire Property (of which the Property is a part) 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. Unpaid real estate taxes and unpaid levied and pending special assessments for the year of Closing shall be the responsibility of Buyer and Seller in proportion to their respective Tenant in Common interests, pro-rated, however, to the date of closing for the period prior to closing, which shall be the responsibility of Seller if Tenant shall not pay the same. Seller and Buyer shall likewise pay all taxes due and payable in the year after Closing and any unpaid installments of special assessments payable therewith and thereafter, if such unpaid levied and pending special assessments and real estate taxes are not paid by any tenant of the Entire Property. (b) All income and all operating expenses from the Entire 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 its proportionate share of all income earned and shall be responsible for its proportionate share of all operating expenses of the Entire Property incurred on and after the date of closing. Buyer Initial: /s/ CRW Purchase Agreement for Children's World, DePere, WI 11. SELLER'S REPRESENTATION AND AGREEMENTS. (a) Seller represents and warrants as of this date that: (i) Except for the Net Lease Agreement in existence between AEI Income & Growth Fund XXII Limited Partnership and ARAMARK Educational Resources, Inc., f/k/a Children's World Learning Centers, Inc., dated July 14, 1999, Seller is not aware of any leases of the Property. (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. However, Buyer acknowledges that Seller retains the right both prior to and after the Closing Date to freely transfer all or a portion of Seller's remaining undivided interest in the Entire Property, provided such sale shall not encumber the Property being purchased by Buyer in violation of the terms hereof or the contemplated Co-Tenancy Agreement. 12. DISCLOSURES. (a) To the best of Seller's knowledge: there are now, and at the Closing there will be, no 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) To the best of Seller's knowledge: the use and operation of the Property now is, and at the time of Closing will be, 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. (c) To the best of Seller's knowledge: the Property is not, and as of the Closing will not be, 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 Buyer Initial: /s/ CRW Purchase Agreement for Children's World, DePere, WI 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 as provided under applicable state or federal laws or regulations. (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. (F) BUYER ACKNOWLEDGES THAT, HAVING BEEN GIVEN THE OPPORTUNITY TO INSPECT THE PROPERTY AND SUCH FINANCIAL INFORMATION ON THE LESSEE AND GUARANTORS OF THE LEASE AS BUYER OR ITS ADVISORS SHALL REQUEST, 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 FURTHER ACKNOWLEDGES THAT THE INFORMATION PROVIDED AND TO BE PROVIDED BY SELLER WITH RESPECT TO THE PROPERTY AND TO THE LESSEE AND GUARANTORS OF LEASE WAS OBTAINED FROM A VARIETY OF SOURCES AND SELLER NEITHER (A) HAS MADE INDEPENDENT INVESTIGATION OR VERIFICATION OF SUCH INFORMATION, OR (B) MAKES ANY REPRESENTATIONS AS TO THE ACCURACY OR COMPLETENESS OF SUCH INFORMATION. THE SALE OF THE PROPERTY AS PROVIDED FOR HEREIN IS MADE ON AN "AS IS" BASIS, AND BUYER EXPRESSLY ACKNOWLEDGES THAT, IN CONSIDERATION OF THE AGREEMENTS OF 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 OR CONDITION, HABITABILITY, TENANTABILITY, SUITABILITY FOR COMMERCIAL PURPOSES, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE, IN RESPECT OF THE PROPERTY. The provisions (d) - (f) above shall survive closing. 13. CLOSING. (a) Before the closing date, Seller will deposit into escrow an executed limited warranty deed conveying insurable title of the Property to Buyer, subject to the encumbrances contained in paragraph 8 above. (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/ CRW Purchase Agreement for Children's World, DePere, WI (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 and Seller will be relieved of all obligations and will be entitled to retain all monies heretofore paid by the Buyer. In addition, Seller shall retain all remedies available to Seller at law or in equity. 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 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. Buyer Initial: /s/ CRW Purchase Agreement for Children's World, DePere, WI 16. DAMAGES, DESTRUCTION AND EMINENT DOMAIN. (a) If, prior to closing, the Property or any part thereof is 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 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 ten-day period provided for above in this Subparagraph 16a 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 (pro-rata in relation to the Entire Property) resulting from said damage or destruction to the extent that the same are payable with respect to damage to the Property, subject to rights of any Tenant of the Entire Property. If the cost of repair is less than $10,000.00, 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 pro-rata in relation to the Entire Property, subject to rights of any Tenant of the Entire Property. (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. 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 the Seller's right, title, and interest in and to any award made, or to be made, in the condemnation proceeding pro-rata in relation to the Entire Property, subject to rights of any Tenant of the Entire Property. 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. BUYER'S 1031 TAX FREE EXCHANGE. While Seller acknowledges that Buyer is purchasing the Property as "replacement property" to accomplish a tax free exchange, Buyer acknowledges that Seller has made no representations, warranties, or agreements to Buyer or Buyer's agents that the transaction contemplated by the Agreement will qualify for such tax treatment, nor has there been any reliance thereon by Buyer respecting the legal or tax implications of the transactions Buyer Initial: /s/ CRW Purchase Agreement for Children's World, DePere, WI contemplated hereby. Buyer further represents that it has sought and obtained such third party advice and counsel as it deems necessary in regards to the tax implications of this transaction. Buyer wishes to novate/assign the ownership rights and interest of this Purchase Agreement to G.T. Transfer and Exchange Corporation, which will act as Accommodator to perfect the 1031 exchange by preparing an agreement of exchange of Real Property whereby G.T. Transfer and Exchange Corporation will be an independent third party purchasing the ownership interest in subject property from Seller and selling the ownership interest in subject property to Buyer under the same terms and conditions as documented in this Purchase Agreement. Seller consents to such assignments. Buyer asks the Seller, and Seller agrees to cooperate in the perfection of such an exchange if at no additional cost or expense to Seller or delay in time. Buyer hereby indemnifies and holds Seller harmless from any claims and/or actions resulting from said exchange. Pursuant to the direction of G.T. Transfer and Exchange Corporation, Seller will deed the Property directly to Buyer. 18. 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 10 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 10 days following the delivery of the notice to the escrow agent, this Contract shall be cancelled. 19. 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 April 30, 2000, through no fault of Seller, Seller may either, at its election, extend the closing date or exercise any remedy available to it by law, including terminating this Agreement. (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. Buyer Initial: /s/ CRW Purchase Agreement for Children's World, DePere, WI (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 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: Robert P. Johnson AEI Income & Growth Fund XXII Limited Partnership 1300 Minnesota World Trade Center 30 E. 7th Street St. Paul, MN 55101 If to Buyer: Carl R. Whittington, Trustee 1440 Elm Grove Avenue Akron, OH 44312 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. REST OF PAGE INTENTIONALLY LEFT BLANK Buyer Initial: /s/ CRW Purchase Agreement for Children's World, DePere, WI IN WITNESS WHEREOF, the Seller and Buyer have executed this Agreement effective as of the day and year above first written. BUYER: Carl R. Whittington, Trustee of the Carl R. Whittington Trust dated October 16, 1996 By: /s/ Carl R Whittington, Trustee Carl R. Whittington, Trustee WITNESS: /s/ Marilyn Dodson Marilyn Dodson (Print Name) SELLER: AEI Income & Growth Fund XXII Limited Partnership, a Minnesota limited partnership By: AEI Fund Management XXI, Inc., its corporate general partner By:/s/ Robert P Johnson Robert P. Johnson, President WITNESS: /s/ Jill Rayburn Jill Rayburn (Print Name) Buyer Initial: /s/ CRW Purchase Agreement for Children's World, DePere, WI EXHIBIT "A" LEGAL DESCRIPTION All of Lot One (1) of Volumnet 34 Certified Survey Maps, Page 125, Brown County Records, and is located in part of Government Lots 1 and 2, Section Thirty-five (35) and part of Government Lot 1 and part of the Southeast One-quarter of the Northeast, One-quarter (SE 1/4 - NE 1/4), Section Thirty-four (34), all being in Township Twenty-three (23) North, Range Twenty (20) East, in the Town of Ledgeview, Brown County, Wisconsin. and Part of Lot One (1) of Volume 30 Certified Survey Maps, Page 71, Brown County Records, being part of Government Lots 1 and 2, Section Thirty-five (35), Township Twenty-three (23) North, Range Twenty (20) East, in the Town of Ledgeview, Brown County, Wisconsin, more fully described as follows: Commencing at the West 1/4 corner, Section 35, T23N, R20E; thence N01 36' 23" West, 1763.33 feet along the West line of said Section 35, to the South right-of- way of Heritage Road, also known as C.T.H. "X"'; thence N89 02'44" East, 82.54 feet along said right-of-way to the point of beginning; thence N89 02'44" East 53.61 feet along said right-of-way; thence 167.98 feet along said right-of-way, being the arc of a 1095.92 foot radius curve to the right, whose long chord bears S86 33'48" East, 167.82 feet; thence S1 36' 23" East, 539.93 feet along the East line of Lot 1, Volume 30 Certified Survey Maps, Page 71, Brown County Records, to the North right-of-way of Swan Road; thence S88 33' 16" West, 220.77 feet along said right-of-way; thence N 1 36' 23" West, 554.67 feet along the East line of Lot 1, Volume 34 Certified Survey Maps, Page 125, Brown County Records, to the point of beginning. Tax Parcel No. D-50-1 and D-84-1 Arcadian Lane/Heritage Road De Pere, WI 54115 EX-10.4 5 PURCHASE AGREEMENT Marie Callender's - Henderson, NV This AGREEMENT, entered into effective as of the 29th of March, 2000. l. PARTIES. Seller is AEI Income & Growth Fund XXII Limited Partnership which presently owns an undivided 26.8390% interest in the fee title to that certain real property legally described in the attached Exhibit "A" (the "Entire Property"). Buyer is Carl R. Whittington, Trustee of the Carl R. Whittington Trust dated October 16, 1996 ("Buyer"). Seller wishes to sell and Buyer wishes to buy a portion as Tenant in Common of Seller's interest in the Entire Property. 2. PROPERTY. The Property to be sold to Buyer in this transaction consists of an undivided 10.4257 percentage interest (hereinafter, simply the "Property") as Tenant in Common in the Entire Property. 3. PURCHASE PRICE The purchase price for this percentage interest in the Entire Property is $224,500, all cash. 4. TERMS. The purchase price for the Property will be paid by Buyer as follows: (a) When this agreement is executed, Buyer will pay $5,000 to Seller (which shall be deposited into escrow according to the terms hereof) (the "First Payment"). The First Payment will be credited against the purchase price when and if escrow closes and the sale is completed. (b) Buyer will deposit the balance of the purchase price, $219,500 (the "Second Payment") into escrow in sufficient time to allow escrow to close on the closing date. 5. CLOSING DATE. Escrow is anticipated to close on or before March 31, 2000. 6. DUE DILIGENCE. Buyer will have until the expiration of the tenth business day (The "Review Period") after delivery of each of following items, to be supplied by Sellers, 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 Sellers harmless for any loss or damage to the Entire Property or persons caused by Buyer or its agents arising out of such physical inspections of the Entire Property. (a) The original and one copy of a title insurance commitment for an Owner's Title insurance policy (see paragraph 8 below). (b) A copy 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. (c) A copy of an "as built" survey of the Entire Property done concurrent with Seller's acquisition of the Property. Buyer Initial: /s/ CRW Purchase Agreement for Marie Callender's-Henderson, NV (d) Lease (as further set forth in paragraph 11(a) below) of the Entire Property showing occupancy date, lease expiration date, rent, and Guarantys, if any, accompanied by such tenant financial statements as may have been provided most recently to Seller by the Tenant and/or Guarantors. It is a contingency upon Seller's obligations hereunder that two (2) copies of Co-Tenancy Agreement in the form attached hereto duly executed by Buyer and AEI Real Estate Fund XIX Limited Partnership and dated on escrow closing date be delivered to the Seller on the closing date. 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. If this Agreement is not cancelled as set forth above, the First Payment shall be non-refundable unless Seller shall default hereunder. If Buyer cancels this Agreement as permitted under this Section, except for any escrow cancellation fees and any liabilities under the first paragraph of section 6 of this agreement (which will survive), Buyer (after execution of such documents reasonably requested by Seller to evidence the termination hereof) shall be returned its First Payment, and 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 Sellers or anyone else. 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 Sellers 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 a nationally-recognized escrow company selected by Seller. 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 a title company selected by Seller 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 insurable 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 as shown in the title commitment. Buyer Initial: /s/ CRW Purchase Agreement for Marie Callender's-Henderson, NV 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 insurable title insuring over Buyer's objections. If Sellers 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. 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 one-half of escrow fees, the cost of the title commitment and any brokerage commissions payable. 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 all recording fees, one-half of the escrow fees, and the cost of an update to the Survey in Seller possession (if an update is required by Buyer.) 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 Entire Property (of which the Property is a part) 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. Unpaid real estate taxes and unpaid levied and pending special assessments existing on the date of Closing shall be the responsibility of Buyer and Seller in proportion to their respective Tenant in Common interests, pro-rated, however, to the date of closing for the period prior to closing, which shall be the responsibility of Seller if Tenant shall not pay the same. Seller and Buyer shall likewise pay all taxes due and payable in the year after Closing and any unpaid installments of special assessments payable therewith and thereafter, if such unpaid levied and pending special assessments and real estate taxes are not paid by any tenant of the Entire Property. (b) All income and all operating expenses from the Entire 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 its proportionate share of all income earned and shall be responsible for its proportionate share of all operating expenses of the Entire Property incurred on and after the date of closing. Buyer Initial: /s/ CRW Purchase Agreement for Marie Callender's-Henderson, NV 11. SELLER'S REPRESENTATION AND AGREEMENTS. (a) Seller represents and warrants as of this date that: (i) Except for the Lease Agreement in existence between AEI Net Lease Income & Growth Fund XIX Limited Partnership, AEI Income & Growth Fund XXII Limited Partnership (as "Landlord") and Marie Callender Pie Shops Inc.("Tenant"), dated September 27, 1999, Seller is not aware of any leases of the Property. The above referenced lease agreement has a right of first refusal in favor of the Tenant as set forth in Article 34 of said lease agreement, which right will apply to any attempted disposition of Property by Buyer after this transaction. (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 permitted 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. However, Buyer acknowledges that Seller retains the right both prior to and after the Closing Date to freely transfer all or a portion of Seller's remaining undivided interest in the Entire Property, provided such sale shall not encumber the Property being purchased by Buyer in violation of the terms hereof or the contemplated Co-Tenancy Agreement. 12. DISCLOSURES. (a) Seller has not received any notice of any material, physical, or mechanical defects of the Entire Property, including without limitation, the plumbing, heating, air conditioning, ventilating, electrical system. To the best of Seller's knowledge without inquiry, 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. If Seller shall receive any notice to the contrary prior to Closing, Seller will inform Buyer prior to Closing. (b) Seller has not received any notice that the use and operation of the Entire Property 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. If Seller shall receive any notice to the contrary prior to Closing, Seller will inform Buyer prior to Closing. (c) Seller knows of no facts nor has Seller failed to disclose to Buyer any fact known to Seller which would prevent the Tenant from using and operating the Entire Property after the Closing in the manner in which the Entire Property has been used and operated Buyer Initial: /s/ CRW Purchase Agreement for Marie Callender's-Henderson, NV prior to the date of this Agreement. If Seller shall receive any notice to the contrary prior to Closing, Seller will inform Buyer prior to Closing. (d) Seller has not received any notice that the Entire Property is in violation of any federal, state or local law, ordinance, or regulations relating to industrial hygiene or the environmental conditions on, under, or about the Entire 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 Entire 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 Entire Property after the Closing Date. Seller shall indemnify Buyer for any liability arising due to Hazardous Materials on or in connection with the Entire Property prior to the Closing Date. If Seller shall receive any notice to the contrary prior to Closing, Seller will inform Buyer prior to Closing. (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. (f) BUYER ACKNOWLEDGES THAT, HAVING BEEN GIVEN THE OPPORTUNITY TO INSPECT THE ENTIRE PROPERTY AND SUCH FINANCIAL INFORMATION ON THE LESSEE AND GUARANTORS OF THE LEASE AS BUYER OR ITS ADVISORS SHALL REQUEST, IF IN SELLER'S POSSESSION, 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 FURTHER ACKNOWLEDGES THAT THE INFORMATION PROVIDED AND TO BE PROVIDED BY SELLER WITH RESPECT TO THE PROPERTY, THE ENTIRE PROPERTY AND TO THE LESSEE AND GUARANTORS OF LEASE WAS OBTAINED FROM A VARIETY OF SOURCES AND SELLER NEITHER (A) HAS MADE INDEPENDENT INVESTIGATION OR VERIFICATION OF SUCH INFORMATION, OR (B) MAKES ANY REPRESENTATIONS AS TO THE ACCURACY OR COMPLETENESS OF SUCH INFORMATION EXCEPT AS HEREIN SET FORTH. THE SALE OF THE PROPERTY AS PROVIDED FOR HEREIN IS MADE ON AN "AS IS" BASIS, AND BUYER EXPRESSLY ACKNOWLEDGES THAT, IN CONSIDERATION OF THE AGREEMENTS OF SELLER HEREIN, EXCEPT AS OTHERWISE SPECIFIED HEREIN IN PARAGRAPH 11(A) AND (B) ABOVE AND THIS PARAGRAPH 12, 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, OR FITNESS FOR A PARTICULAR PURPOSE, IN RESPECT OF THE PROPERTY. The provisions (d) - (f) above shall survive Closing. 13. CLOSING. (a) Before the closing date, Seller will deposit into escrow an executed special warranty deed warranting title against lawful claims by, through, or under a conveyance Buyer Initial: /s/ CRW Purchase Agreement for Marie Callender's-Henderson, NV from Seller, but not further or otherwise, conveying insurable title of the Property to Buyer, subject to the exceptions contained in paragraph 8 above. (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 and Seller will be relieved of all obligations and will be entitled to retain all monies heretofore paid by the Buyer. In addition, Seller shall retain all remedies available to Seller at law or in equity. 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 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 Buyer Initial: /s/ CRW Purchase Agreement for Marie Callender's-Henderson, NV 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 is 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 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 ten-day period provided for above in this Subparagraph 16a 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 (pro-rata in relation to the Entire Property) resulting from said damage or destruction to the extent that the same are payable with respect to damage to the Property, subject to rights of any Tenant of the Entire Property. If the cost of repair is less than $10,000.00, 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 pro-rata in relation to the Entire Property, subject to rights of any Tenant of the Entire Property. (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. 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 the Seller's right, title, and interest in and to any award made, or to be made, in the condemnation proceeding pro-rata in relation to the Entire Property, subject to rights of any Tenant of the Entire Property. 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). Buyer Initial: /s/ CRW Purchase Agreement for Marie Callender's-Henderson, NV 17. BUYER'S 1031 TAX FREE EXCHANGE. While Seller acknowledges that Buyer is purchasing the Property as "replacement property" to accomplish a tax free exchange, Buyer acknowledges that Seller has made no representations, warranties, or agreements to Buyer or Buyer's agents that the transaction contemplated by the Agreement will qualify for such tax treatment, nor has there been any reliance thereon by Buyer respecting the legal or tax implications of the transactions contemplated hereby. Buyer further represents that it has sought and obtained such third party advice and counsel as it deems necessary in regards to the tax implications of this transaction. Buyer wishes to novate/assign the ownership rights and interest of this Purchase Agreement to G.T. Transfer and Exchange Corporation, which will act as Accommodator to perfect the 1031 exchange by preparing an agreement of exchange of Real Property whereby G.T. Transfer and Exchange Corporation, will be an independent third party purchasing the ownership interest in subject property from Seller and selling the ownership interest in subject property to Buyer under the same terms and conditions as documented in this Purchase Agreement. Seller consents to such assignments. Buyer asks the Seller, and Seller agrees to cooperate in the perfection of such an exchange if at no additional cost or expense to Seller or delay in time. Buyer hereby indemnifies and holds Seller harmless from any claims and/or actions resulting from said exchange. Pursuant to the direction of G.T. Transfer and Exchange Corporation, Seller will deed the Property directly to Buyer. 18. 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 10 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 10 days following the delivery of the notice to the escrow agent, this Contract shall be cancelled. 19. 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. Buyer Initial: /s/ CRW Purchase Agreement for Marie Callender's-Henderson, NV (b) If this escrow has not closed by April 30, 2000, through no fault of Seller, Seller may either, at its election, extend the closing date or exercise any remedy available to it by law, including terminating this Agreement. (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 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: Robert P. Johnson AEI Income & Growth Fund XXII Limited Partnership 1300 Minnesota World Trade Center 30 E. 7th Street St. Paul, MN 55101 If to Buyer: Carl R. Whittington, Trustee 1440 Elm Grove Avenue Akron, OH 44312 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. REST OF PAGE INTENTIONALLY LEFT BLANK. Buyer Initial: /s/ CRW Purchase Agreement for Marie Callender's-Henderson, NV IN WITNESS WHEREOF, the Seller and Buyer have executed this Agreement effective as of the day and year above first written. BUYER: Carl R. Whittington, Trustee of the Carl R. Whittington Trust dated October 16, 1996 By:/s/ Carl R Whittington Carl R. Whittington, Trustee Witness /s/ Marilyn Dodson SELLER: AEI Income & Growth Fund XXII Limited Partnership By: AEI Fund Management XXI, Inc., its corporate general partner By: /s/ Robert P Johnson Robert P. Johnson, President Witness /s/ Jill Rayburn Jill Rayburn Buyer Initial: /s/ CRW Purchase Agreement for Marie Callender's-Henderson, NV EXHIBIT "A" LEGAL DESCRIPTION (Henderson, Nevada) Being a division of Lot One (1) as shown upon the FINAL MAP OF GALLERIA COMMONS ( a commercial subdivision) as depicted in Book 79, Page 48 of Plats, Official Records, Clark County, Nevada, also being a portion of the West Half (W 1/2) of the Southwest Quarter (SW 1/4) of Section 3, Township 22 South, Range 62 East, M.D.M., City of Henderson, Clark County, Nevada, more particularly described as follows: Commencing at the West Quarter Corner (w 1/4 Cor.) of said Section 3, said corner being common to Sections 3 and 4; Thence South 00 14' 06" West along the West line of said Section 3, a distance of 808.13 feet; Thence North 88 55' 32" East, a distance of 50.01 fee to a point on the Easterly right of way line of Stephanie Street' Thence south 00 14' 06" West along said Easterly right of way line, a distance of 585.62 feet; Thence South 89 45' 54" East, a distance of 20.00 feet to the Point of Beginning; Thence North 88 51' 28" East, a distance of 147.22 feet; Thence South 01 05' 43" East, a distance of 108.33 feet; Thence South 88 51' 28" West, a distance of 2.92 feet; Thence South 89 56' 32" West, a distance of 149.41 feet; Thence North 00 14' 06" East, a distance of 284.89 feet to the POINT OF BEGINNING EX-10.5 6 PURCHASE AGREEMENT Hollywood Video - Saraland, AL This AGREEMENT, entered into effective as of the 27th of March, 2000. l. PARTIES. Seller is AEI Income & Growth Fund XXII Limited Partnership which owns an undivided 100% interest in the fee title to that certain real property legally described in the attached Exhibit "A" (the "Entire Property") Buyer is Carl R. Whittington, Trustee of the Carl R. Whittington Trust dated October 16, 1996 ("Buyer"). Seller wishes to sell and Buyer wishes to buy a portion of Seller's tenant in common interest in the Entire Property. 2. PROPERTY. The Property to be sold to Buyer in this transaction consists of an undivided 12.1242 percentage interest (hereinafter, simply the "Property") as Tenant in Common in the Entire Property. 3. PURCHASE PRICE. The purchase price for this percentage interest in the Entire Property is $224,500, all cash. 4. TERMS. The purchase price for the Property will be paid by Buyer as follows: (a) When this agreement is executed, Buyer will pay $5,000 to Seller (which shall be deposited into escrow according to the terms hereof) (the "First Payment"). The First Payment will be credited against the purchase price when and if escrow closes and the sale is completed. (b) Buyer will deposit the balance of the purchase price, 219,500 (the "Second Payment") into escrow in sufficient time to allow escrow to close on the closing date. 5. CLOSING DATE. Escrow is anticipated to close on or before March 31, 2000. 6. DUE DILIGENCE. Buyer will have until the expiration of the tenth business day (The "Review Period") 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 Entire Property or persons caused by Buyer or its agents arising out of such physical inspections of the Entire Property. (a) The original and one copy of a title insurance commitment for an Owner's Title insurance policy (see paragraph 8 below). (b) A copy 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. (c) A copy of an "as built" survey of the Entire Property done concurrent with Seller's acquisition of the Property. Buyer Initial: /s/ CRW Purchase Agreement for Hollywood Video, Saraland, AL (d) Lease (as further set forth in paragraph 11(a) below) of the Entire Property showing occupancy date, lease expiration date, rent, and Guarantys, if any, accompanied by such tenant financial statements as may have been provided most recently to Seller by the Tenant and/or Guarantors. It is a contingency upon Seller's obligations hereunder that two (2) copies of Co-Tenancy Agreement in the form attached hereto duly executed by Buyer and Seller and dated on escrow closing date be delivered to the Seller on the closing date. Buyer may cancel this agreement for ANY REASON in its sole discretion by delivering a cancellation notice, via first class mail, 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. If this Agreement is not cancelled as set forth above, the First Payment shall be non-refundable unless Seller shall default hereunder. If Buyer cancels this Agreement as permitted under this Section, except for any escrow cancellation fees and any liabilities under the first paragraph of sections 6 of this agreement (which will survive), Buyer (after execution of such documents reasonably requested by Seller to evidence the termination hereof) shall be returned its First Payment, and 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 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 a nationally-recognized escrow company selected by Seller. 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 commitment of a title company selected by Seller 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 insurable 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; all matters of public record as shown in the title commitment; and other items disclosed to Buyer during the Review Period. Buyer Initial: /s/ CRW Purchase Agreement for Hollywood Video, Saraland, AL Buyer shall be allowed ten (10) 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 insurable 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. 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 one-half of escrow fees, the cost of the title commitment and any brokerage commissions payable. 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 all recording fees, one-half of the escrow fees, and the cost of an update to the Survey in Sellers possession (if an update is required by Buyer.) 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 Entire Property (of which the Property is a part) 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. Unpaid real estate taxes and unpaid levied and pending special assessments existing on the date of Closing shall be the responsibility of Buyer and Seller in proportion to their respective Tenant in Common interests, pro-rated, however, to the date of closing for the period prior to closing, which shall be the responsibility of Seller if Tenant shall not pay the same. Seller and Buyer shall likewise pay all taxes due and payable in the year after Closing and any unpaid installments of special assessments payable therewith and thereafter, if such unpaid levied and pending special assessments and real estate taxes are not paid by any tenant of the Entire Property. (b) All income and all operating expenses from the Entire 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 its proportionate share of all income earned and shall be responsible for its proportionate share of all operating expenses of the Entire Property incurred on and after the date of closing. Buyer Initial: /s/ CRW Purchase Agreement for Hollywood Video, Saraland, AL 11. SELLER'S REPRESENTATION AND AGREEMENTS. (a) Seller represents and warrants as of this date that: (i) Except for the lease in existence between Centurion Video, LTD (as "Landlord") and Hollywood Entertainment Corporation ("as Tenant") dated September 27, 1997 and the assignment of lease from Centurion Video, LTD ("Centurion", Assignor") to AEI Income & Growth Fund XXII Limited Partnership ("AEI", "Assignee") dated January 12, 1999, Seller is not aware of any leases of the Property. (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 permitted 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. However, Buyer acknowledges that Seller retains the right both prior to and after the Closing Date to freely transfer all or a portion of Seller's remaining undivided interest in the Entire Property, provided such sale shall not encumber the Property being purchased by Buyer in violation of the terms hereof or the contemplated Co-Tenancy Agreement. 12. DISCLOSURES. (a) Seller has not received any notice of any material, physical, or mechanical defects of the Entire Property, including without limitation, the plumbing, heating, air conditioning, ventilating, electrical system. To the best of Seller's knowledge without inquiry, 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. If Seller shall receive any notice to the contrary prior to Closing, Seller will inform Buyer prior to Closing. (b) Seller has not received any notice that the use and operation of the Entire Property 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. If Seller shall receive any notice to the contrary prior to Closing, Seller will inform Buyer prior to Closing. (c) Seller knows of no facts nor has Seller failed to disclose to Buyer any fact known to Seller which would prevent the Tenant from using and operating the Entire Property after the Closing in the manner in which the Entire Property has been used and operated prior to the date of this Agreement. If Seller shall receive any notice to the contrary prior to Closing, Seller will inform Buyer prior to Closing. Buyer Initial: /s/ CRW Purchase Agreement for Hollywood Video, Saraland, AL (d) Seller has not received any notice that the Entire Property is in violation of any federal, state or local law, ordinance, or regulations relating to industrial hygiene or the environmental conditions on, under, or about the Entire 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 Entire 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 Entire Property either before or after the Closing Date, except such Hazardous Materials on or in connection with the Entire Property arising out of Seller's gross negligence or intentional misconduct. If Seller shall receive any notice to the contrary prior to Closing, Seller will inform Buyer prior to Closing. (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. (f) BUYER ACKNOWLEDGES THAT, HAVING BEEN GIVEN THE OPPORTUNITY TO INSPECT THE ENTIRE PROPERTY AND SUCH FINANCIAL INFORMATION ON THE LESSEE AND GUARANTORS OF THE LEASE AS BUYER OR ITS ADVISORS SHALL REQUEST, IF IN SELLER'S POSSESSION, 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 FURTHER ACKNOWLEDGES THAT THE INFORMATION PROVIDED AND TO BE PROVIDED BY SELLER WITH RESPECT TO THE PROPERTY, THE ENTIRE PROPERTY AND TO THE LESSEE AND GUARANTORS OF LEASE WAS OBTAINED FROM A VARIETY OF SOURCES AND SELLER NEITHER (A) HAS MADE INDEPENDENT INVESTIGATION OR VERIFICATION OF SUCH INFORMATION, OR (B) MAKES ANY REPRESENTATIONS AS TO THE ACCURACY OR COMPLETENESS OF SUCH INFORMATION EXCEPT AS HEREIN SET FORTH. THE SALE OF THE PROPERTY AS PROVIDED FOR HEREIN IS MADE ON AN "AS IS" BASIS, AND BUYER EXPRESSLY ACKNOWLEDGES THAT, IN CONSIDERATION OF THE AGREEMENTS OF SELLER HEREIN, EXCEPT AS OTHERWISE SPECIFIED HEREIN IN PARAGRAPH 11(A) AND (B) ABOVE AND THIS PARAGRAPH 12, 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, OR FITNESS FOR A PARTICULAR PURPOSE, IN RESPECT OF THE PROPERTY. The provisions (d) - (f) above shall survive Closing. 13. CLOSING. (a) Before the closing date, Seller will deposit into escrow an executed special warranty deed warranting title against lawful claims by, through, or under a conveyance from Seller, but not further or otherwise, conveying insurable title of the Property to Buyer, subject to the exceptions contained in paragraph 8 above. Buyer Initial: /s/ CRW Purchase Agreement for Hollywood Video, Saraland, AL (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 and Seller will be relieved of all obligations and will be entitled to retain all monies heretofore paid by the Buyer. In addition, Seller shall retain all remedies available to Seller at law or in equity. 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. Buyer Initial: /s/ CRW Purchase Agreement for Hollywood Video, Saraland, AL (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 is 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 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 ten-day period provided for above in this Subparagraph 16a 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 (pro-rata in relation to the Entire Property) resulting from said damage or destruction to the extent that the same are payable with respect to damage to the Property, subject to rights of any Tenant of the Entire Property. If the cost of repair is less than $10,000.00, 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 pro-rata in relation to the Entire Property, subject to rights of any Tenant of the Entire Property. (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. 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 the Seller's right, title, and interest in and to any award made, or to be made, in the condemnation proceeding pro-rata in relation to the Entire Property, subject to rights of any Tenant of the Entire Property. 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). Buyer Initial: /s/ CRW Purchase Agreement for Hollywood Video, Saraland, AL 17. BUYER'S 1031 TAX FREE EXCHANGE. While Seller acknowledges that Buyer is purchasing the Property as "replacement property" to accomplish a tax free exchange, Buyer acknowledges that Seller has made no representations, warranties, or agreements to Buyer or Buyer's agents that the transaction contemplated by the Agreement will qualify for such tax treatment, nor has there been any reliance thereon by Buyer respecting the legal or tax implications of the transactions contemplated hereby. Buyer further represents that it has sought and obtained such third party advice and counsel as it deems necessary in regards to the tax implications of this transaction. Buyer wishes to novate/assign the ownership rights and interest of this Purchase Agreement to G.T. Transfer and Exchange Corporation, which will act as Accommodator to perfect the 1031 exchange by preparing an agreement of exchange of Real Property whereby G.T. Transfer and Exchange Corporation, will be an independent third party purchasing the ownership interest in subject property from Seller and selling the ownership interest in subject property to Buyer under the same terms and conditions as documented in this Purchase Agreement. Seller consents to such assignments. Buyer asks the Seller, and Seller agrees to cooperate in the perfection of such an exchange if at no additional cost or expense to Seller or delay in time. Buyer hereby indemnifies and holds Seller harmless from any claims and/or actions resulting from said exchange. Pursuant to the direction of G.T. Transfer and Exchange Corporation, Seller will deed the Property directly to Buyer. 18. 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 10 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 10 days following the delivery of the notice to the escrow agent, this Contract shall be cancelled. 19. 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. Buyer Initial: /s/ CRW Purchase Agreement for Hollywood Video, Saraland, AL (b) If this escrow has not closed by April 30, 2000, through no fault of Seller, Seller may either, at its election, extend the closing date or exercise any remedy available to it by law, including terminating this Agreement. (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 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: Robert P. Johnson AEI Income & Growth Fund XXII Limited Partnership 1300 Minnesota World Trade Center 30 E. 7th Street St. Paul, MN 55101 If to Buyer: Carl R. Whittington, Trustee 1440 Elm Grove Avenue Akron, OH 44312 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. REST OF PAGE INTENTIONALLY LEFT BLANK Buyer Initial: /s/ CRW Purchase Agreement for Hollywood Video, Saraland, AL IN WITNESS WHEREOF, the Seller and Buyer have executed this Agreement effective as of the day and year above first written. BUYER: Carl R. Whittington, Trustee of the Carl R. Whittington Trust dated October 16, 1996 By:/s/ Carl R Whittington, Trustee Carl R. Whittington, Trustee Witness /s/ Marilyn Dodson SELLER: AEI Income & Growth Fund XXII Limited Partnership By: AEI Fund Management XXI, Inc., its corporate general partner By: /s/ Robert P Johsnon Robert P. Johnson, President Witness /s/ Jill Rayburn Jill Rayburn Buyer Initial: /s/ CRW Purchase Agreement for Hollywood Video, Saraland, AL EXHIBIT A Lot 1, WAL*MART SQUARE, according to the plat thereof recorded in Map Book 70, Page 25 of the probate Court Records of Mobile County, Alabama. EX-10.6 7 PROPERTY CO-TENANCY OWNERSHIP AGREEMENT (Hollywood Video, Saraland, AL) THIS CO-TENANCY AGREEMENT, Made and entered into as of the 30th day of March, 2000, by and between Carl R. Whittington, Trustee of the Carl R. Whittington Trust dated October 16, 1996(hereinafter called "Whittington") and AEI Income & Growth Fund XXII Limited Partnership (hereinafter called "Fund XXII") Whittington, Fund XXII (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 87.8758% interest in and to, and Whittington presently owns an undivided 12.1242% interest in and to the land, situated in the City of Saraland, County of Mobile, and State of AL, (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 operation and management of the Premises and Whittington's interest by Fund XXII; the continued leasing of space within the Premises; for the distribution of income from and the pro-rata sharing in expenses of the Premises. NOW THEREFORE, in consideration of the purchase by Whittington 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. The operation and management of the Premises shall be delegated to Fund XXII, or its designated agent, successors or assigns. Provided, however, if Fund XXII shall sell all of its interest in the Premises, the duties and obligations of Fund XXII respecting management of the Premises as set forth herein, including but not limited to paragraphs 2, 3, and 4 hereof, shall be exercised by the holder or holders of a majority undivided co- tenancy interest in the Premises. Except as hereinafter expressly provided to the contrary, each of the parties hereto agrees to be bound by the decisions of Fund XXII with respect to all administrative, operational and management matters of the property comprising the Premises, including but not limited to the management of the net lease agreement for the Premises. Whittington hereto hereby designates Fund XXII as its sole and exclusive agent to deal with, and Fund XXII retains the sole right to deal with, any property agent or tenant and to negotiate and enter into, on terms and provisions satisfactory to Fund XXII, monitor, execute and enforce the terms of leases of space within the Premises, including but not limited to any amendments, consents to assignment, sublet, releases or modifications to leases or guarantees of lease or easements affecting the Premises, on behalf Co-Tenant Initial: /s/ CRW Co-Tenancy Agreement for Hollywood Video, Saraland, AL of Whittington As long as Fund XXII owns an interest in the Premises, only Fund XXII may obligate Whittington with respect to any expense for the Premises. As further set forth in paragraph 2 hereof, Fund XXII agrees to require any lessee of the Premises to name Whittington as an insured or additional insured in all insurance policies provided for, or contemplated by, any lease on the Premises. Fund XXII 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, Fund XXII 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. Fund XXII may offset against, pay to itself and deduct from any payment due to Whittington under this Agreement, and may pay to itself the amount of Whittington 's share of any reasonable expenses of the Premises which are not paid by Whittington to Fund XXII or its assigns, within ten (10) days after demand by Fund XXII. In the event there is insufficient operating income from which to deduct Whittington's unpaid share of operating expenses, Fund XXII 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 tenant under terms of any lease agreement of the Premises. Whittington has no requirement to, but has, nonetheless elected to retain, and agrees to annually reimburse, Fund XXII in the amount of $550 for the expenses, direct and indirect, incurred by Fund XXII in providing Whittington with quarterly accounting and distributions of Whittington 's share of net income and for tracking, reporting and assessing the calculation of Whittington 's share of operating expenses incurred from the Premises. This invoice amount shall be pro-rated for partial years and Whittington authorizes Fund XXII to deduct such amount from Whittington's share of revenue from the Premises. Whittington 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; however, enforcement of all other provisions of the lease remains the sole right of Fund XXII pursuant to Section 1 hereof. Fund XXII may terminate its obligation under this paragraph upon 30 days notice to Whittington 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 Fund XXII'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, Fund XXII Co-Tenant Initial: /s/ CRW Co-Tenancy Agreement for Hollywood Video, Saraland, AL 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, Whittington shall be entitled to receive 12.1242% 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 therefor from Fund XXII, shall, within fifteen (15) business days after receipt of notice, make payment to Fund XXII 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. 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. 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 January 30, 2033 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 Premises and with the title thereto. Once any person, party or entity has ceased to have an interest in fee in any portion of the Premises, 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. 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; Co-Tenant Initial: /s/ CRW Co-Tenancy Agreement for Hollywood Video, Saraland, AL If to Fund XXII: AEI Income and Growth Fund XXII Limited Partnership 1300 Minnesota World Trade Center 30 E. Seventh Street St. Paul, Minnesota 55101 If to Whittington: Carl R. Whittington, Trustee 1440 Elm Grove Avenue Akron, OH 44312 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. 9. This Agreement shall not create any partnership or joint venture among or between the Co-Tenants or any of them, and 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. REST OF PAGE INTENTIONALLY LEFT BLANK Co-Tenant Initial: /s/ CRW Co-Tenancy Agreement for Hollywood Video, Saraland, AL IN WITNESS WHEREOF, The parties hereto have caused this Agreement to be executed and delivered, as of the day and year first above written. Whittington: Carl R. Whittington, Trustee of the Carl R. Whittington Trust dated October 16, 1996 By:/s/ Carl R Whittington Trustee Carl R. Whittington, Trustee STATE OF OHIO) ) ss COUNTY OF Summit) I, a Notary Public in and for the state and county of aforesaid, hereby certify there appeared before me this 27th day of March, 2000, Carl R. Whittington, Trustee of the Carl R. Whittington Trust dated October 16, 1996 who executed the foregoing instrument in said capacity. /s/ Marilyn Dodson Notary Public [notary seal] Co-Tenant Initial: /s/ CRW Co-Tenancy Agreement for Hollywood Video, Saraland, AL Fund XXII: AEI Income & Growth Fund XXII Limited Partnership By: AEI Fund Management XXI, Inc., its corporate general partner By:/s/ Robert P Johnson Robert P. Johnson, President State of Minnesota ) ) ss. County of Ramsey ) I, a Notary Public in and for the state and county of aforesaid, hereby certify there appeared before me this 28th day of March, 2000, Robert P. Johnson, President of AEI Fund Management XXI, Inc., corporate general partner of AEI Income & Growth Fund XXII Limited Partnership, who executed the foregoing instrument in said capacity and on behalf of the corporation in its capacity as corporate general partner, on behalf of said limited partnership. /s/ Barbara J Kochevar Notary Public [notary seal] Co-Tenant Initial: /s/ CRW Co-Tenancy Agreement for Hollywood Video, Saraland, AL EXHIBIT A Lot 1, WAL*MART SQUARE, according to the plat thereof recorded in Map Book 70, Page 25 of the probate Court Records of Mobile County, Alabama. EX-10.7 8 PROPERTY CO-TENANCY OWNERSHIP AGREEMENT (Children's World - DePere, WI) THIS CO-TENANCY AGREEMENT, Made and entered into as of the 30th day of March, 2000, by and between Carl R. Whittington, Trustee of the Carl R. Whittington Trust dated October 16, 1996 (hereinafter called "Whittington") and AEI Income & Growth Fund XXII Limited Partnership (hereinafter called "Fund XXII") (Whittington, Fund XXII (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 51.2537% interest in and to, and Whittington presently owns an undivided 14.8036% interest in and to, George M. Kunitake and Kay H. Kunitake, husband and wife as joint tenants, and Steven T. Kunitake, a married man as his sole and separate property, all as joint tenants presently own an undivided 16.7323% interest in and to, and D & R Family Limited Partnership presently owns an undivided 17.2104% in and to the land situated in the City of DePere, County of Brown and State of WI, (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 operation and management of the Premises and Whittington's interest by Fund XXII; the continued leasing of space within the Premises; for the distribution of income from and the pro-rata sharing in expenses of the Premises. NOW THEREFORE, in consideration of the purchase by Whittington 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. The operation and management of the Premises shall be delegated to Fund XXII, or its designated agent, successors or assigns. Provided, however, if Fund XXII shall sell all of its interest in the Premises, the duties and obligations of Fund XXII respecting management of the Premises as set forth herein, including but not limited to paragraphs 2, 3, and 4 hereof, shall be exercised by the holder or holders of a majority undivided co- tenancy interest in the Premises. Except as hereinafter expressly provided to the contrary, each of the parties hereto agrees to be bound by the decisions of Fund XXII with respect to all administrative, operational and management matters of the property comprising the Premises, including but not limited to the management of the net lease agreement for the Premises. The parties hereto hereby designate Fund XXII as their sole and exclusive agent to deal with, and Fund XXII retains the sole right to deal with, any property agent or tenant and to monitor, execute and enforce the terms of leases of Co-Tenant Initial: /s/ CRW Co-Tenancy Agreement for Children's World, DePere, WI space within the Premises, including but not limited to any amendments, consents to assignment, sublet, releases or modifications to leases or guarantees of lease or easements affecting the Premises, on behalf of Whittington. As long as Fund XXII owns an interest in the Premises, only Fund XXII may obligate Whittington with respect to any expense for the Premises. As further set forth in paragraph 2 hereof, Fund XXII agrees to require any lessee of the Premises to name Whittington as an insured or additional insured in all insurance policies provided for, or contemplated by, any lease on the Premises. Fund XXII 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, Fund XXII 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. Fund XXII may offset against, pay to itself and deduct from any payment due to Whittington under this Agreement, and may pay to itself the amount of Whittington's share of any legitimate expenses of the Premises which are not paid by Whittington to Fund XXII or its assigns, within ten (10) days after demand by Fund XXII. In the event there is insufficient operating income from which to deduct Whittington's unpaid share of operating expenses, Fund XXII 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 Tenant under terms of any lease agreement of the Premises. Whittington has no requirement to, but has, nonetheless elected to retain, and agrees to annually reimburse, Fund XXII in the amount of $550 for the expenses, direct and indirect, incurred by Fund XXII in providing Whittington with quarterly accounting and distributions of Whittington's share of net income and for tracking, reporting and assessing the calculation of Whittington's share of operating expenses incurred from the Premises. This invoice amount shall be pro-rated for partial years and Whittington authorizes Fund XXII to deduct such amount from Whittington 's share of revenue from the Premises. Whittington 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; however, enforcement of all other provisions of the lease remains the sole right of Fund XXII pursuant to Section 1 hereof. Fund XXII may terminate its obligation under this paragraph upon 30 days notice to Whittington 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 Fund XXII's principal office, and each Co-Tenant shall have Co-Tenant Initial: /s/ CRW Co-Tenancy Agreement for Children's World, DePere, WI 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, Fund XXII 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, Whittington shall be entitled to receive 14.8036% 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 therefor from Fund XXII, shall, within fifteen (15) business days after receipt of notice, make payment to Fund XXII 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. 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. 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 July 14, 2029 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. 8. Any notice or election required or permitted to be given or served by any party hereto to, or upon any other, shall be deemed given or served in accordance with the provisions of this Agreement, if said notice or elections addressed as follows; Co-Tenant Initial: /s/ CRW Co-Tenancy Agreement for Children's World, DePere, WI If to Fund XXII: AEI Income & Growth Fund XXII Limited Partnership 1300 Minnesota World Trade Center 30 E. Seventh Street St. Paul, Minnesota 55101 If to Whittington: Carl R. Whittington, Trustee 1440 Elm Grove Avenue Akron, OH 44312 If to Kunitake: George M. and Kay H. Kunitake Steven T. Kunitake 153 Exeter San Carlos, CA 94070 If to D & R: Robert DeKlotz, Partner D & R Family Limited Partnership 1760 E. North Hills Drive LaHabra, CA 90631 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. 9. This Agreement shall not create any partnership or joint venture among or between the Co-Tenants or any of them, and 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, Co-Tenant Initial: /s/ CRW Co-Tenancy Agreement for Children's World, DePere, WI 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. REST OF PAGE INTENTIONNALLY LEFT BLANK Co-Tenant Initial: /s/ CRW Co-Tenancy Agreement for Children's World, DePere, WI IN WITNESS WHEREOF, The parties hereto have caused this Agreement to be executed and delivered, as of the day and year first above written. Whittington: Carl R. Whittington, Trustee of the Carl R. Whittington Trust dated October 16, 1996 By: /s/ Carl R Whittington Trustee Carl R. Whittington, Trustee WITNESS /s/ Stella Ford Stella Ford (Print Name) State of Ohio) ) ss. County of Summit) I, a Notary Public in and for the state and county of aforesaid, hereby certify there appeared before me this 27 day of March, 2000, Carl R. Whittington, Trustee of the Carl R. Whittington Trust dated October 16, 1996, who executed the foregoing instrument in said capacity. /s/ Marilyn Dodson Notary Public [notary seal] Co-Tenant Initial: /s/ CRW Co-Tenancy Agreement for Children's World, DePere, WI Fund XXII: AEI Income & Growth Fund XXII Limited Partnership By: AEI Fund Management XXI, Inc., its corporate general partner By:/s/ Robert P Johnson Robert P. Johnson, President WITNESS: /s/ Jill Rayburn Jill Rayburn (Print Name) State of Minnesota ) ) ss. County of Ramsey ) I, a Notary Public in and for the state and county of aforesaid, hereby certify there appeared before me this 28th day of March, 2000, Robert P. Johnson, President of AEI Fund Management XXI Inc., corporate general partner of AEI Income & Growth Fund XXII Limited Partnership, who executed the foregoing instrument in said capacity and on behalf of the corporation in its capacity as corporate general partner, on behalf of said limited partnership. /s/ Barbara J Kochevar Notary Public [notary seal] Co-Tenant Initial: /s/ CRW Co-Tenancy Agreement for Children's World, DePere, WI EXHIBIT "A" LEGAL DESCRIPTION All of Lot One (1) of Volumnet 34 Certified Survey Maps, Page 125, Brown County Records, and is located in part of Government Lots 1 and 2, Section Thirty-five (35) and part of Government Lot 1 and part of the Southeast One-quarter of the Northeast, One-quarter (SE 1/4 - NE 1/4), Section Thirty-four (34), all being in Township Twenty-three (23) North, Range Twenty (20) East, in the Town of Ledgeview, Brown County, Wisconsin. and Part of Lot One (1) of Volume 30 Certified Survey Maps, Page 71, Brown County Records, being part of Government Lots 1 and 2, Section Thirty-five (35), Township Twenty-three (23) North, Range Twenty (20) East, in the Town of Ledgeview, Brown County, Wisconsin, more fully described as follows: Commencing at the West 1/4 corner, Section 35, T23N, R20E; thence N01 36' 23" West, 1763.33 feet along the West line of said Section 35, to the South right-of- way of Heritage Road, also known as C.T.H. "X"'; thence N89 02'44" East, 82.54 feet along said right-of-way to the point of beginning; thence N89 02'44" East 53.61 feet along said right-of-way; thence 167.98 feet along said right-of-way, being the arc of a 1095.92 foot radius curve to the right, whose long chord bears S86 33'48" East, 167.82 feet; thence S1 36' 23" East, 539.93 feet along the East line of Lot 1, Volume 30 Certified Survey Maps, Page 71, Brown County Records, to the North right-of-way of Swan Road; thence S88 33' 16" West, 220.77 feet along said right-of-way; thence N 1 36' 23" West, 554.67 feet along the East line of Lot 1, Volume 34 Certified Survey Maps, Page 125, Brown County Records, to the point of beginning. Tax Parcel No. D-50-1 and D-84-1 Arcadian Lane/Heritage Road De Pere, WI 54115 EX-10.8 9 PURCHASE AGREEMENT Marie Callender's - Henderson, NV This AGREEMENT, entered into effective as of the 13th of April, 2000. l. PARTIES. Seller is AEI Income & Growth Fund XXII Limited Partnership which presently owns an undivided 16.4133% interest in the fee title to that certain real property legally described in the attached Exhibit "A" (the "Entire Property"). Buyer is Francis E. Quinn and Cecile Ann Quinn, husband and wife as survivorship marital property ("Buyer"). Seller wishes to sell and Buyer wishes to buy a portion as Tenant in Common of Seller's interest in the Entire Property. 2. PROPERTY. The Property to be sold to Buyer in this transaction consists of an undivided 10.1238 percentage interest (hereinafter, simply the "Property") as Tenant in Common in the Entire Property. 3. PURCHASE PRICE The purchase price for this percentage interest in the Entire Property is $218,000, all cash. 4. TERMS. The purchase price for the Property will be paid by Buyer as follows: (a) When this agreement is executed, Buyer will pay $5,000 to Seller (which shall be deposited into escrow according to the terms hereof) (the "First Payment"). The First Payment will be credited against the purchase price when and if escrow closes and the sale is completed. (b) Buyer will deposit the balance of the purchase price, $213,000 (the "Second Payment") into escrow in sufficient time to allow escrow to close on the closing date. 5. CLOSING DATE. Escrow is anticipated to close on or before April 30, 2000. 6. DUE DILIGENCE. Buyer will have until the expiration of the tenth business day (The "Review Period") after delivery of each of following items, to be supplied by Sellers, 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 Sellers harmless for any loss or damage to the Entire Property or persons caused by Buyer or its agents arising out of such physical inspections of the Entire Property. (a) The original and one copy of a title insurance commitment for an Owner's Title insurance policy (see paragraph 8 below). (b) A copy 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. (c) A copy of an "as built" survey of the Entire Property done concurrent with Seller's acquisition of the Property. Buyer Initial: /s/ FQ /s/ CAQ Purchase Agreement for Marie Callender's - Henderson, NV (d) Lease (as further set forth in paragraph 11(a) below) of the Entire Property showing occupancy date, lease expiration date, rent, and Guarantys, if any, accompanied by such tenant financial statements as may have been provided most recently to Seller by the Tenant and/or Guarantors. It is a contingency upon Seller's obligations hereunder that two (2) copies of Co-Tenancy Agreement in the form attached hereto duly executed by Buyer and AEI Real Estate Fund XIX Limited Partnership and dated on escrow closing date be delivered to the Seller on the closing date. 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. If this Agreement is not cancelled as set forth above, the First Payment shall be non-refundable unless Seller shall default hereunder. If Buyer cancels this Agreement as permitted under this Section, except for any escrow cancellation fees and any liabilities under the first paragraph of section 6 of this agreement (which will survive), Buyer (after execution of such documents reasonably requested by Seller to evidence the termination hereof) shall be returned its First Payment, and 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 Sellers or anyone else. 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 Sellers 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 a nationally-recognized escrow company selected by Seller. 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 a title company selected by Seller 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 insurable 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 as shown in the title commitment. Buyer Initial: /s/ FQ /s/ CAQ Purchase Agreement for Marie Callender's - Henderson, NV 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 insurable title insuring over Buyer's objections. If Sellers 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. 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 one-half of escrow fees, the cost of the title commitment and any brokerage commissions payable. 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 all recording fees, one-half of the escrow fees, and the cost of an update to the Survey in Seller possession (if an update is required by Buyer.) 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 Entire Property (of which the Property is a part) 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. Unpaid real estate taxes and unpaid levied and pending special assessments existing on the date of Closing shall be the responsibility of Buyer and Seller in proportion to their respective Tenant in Common interests, pro-rated, however, to the date of closing for the period prior to closing, which shall be the responsibility of Seller if Tenant shall not pay the same. Seller and Buyer shall likewise pay all taxes due and payable in the year after Closing and any unpaid installments of special assessments payable therewith and thereafter, if such unpaid levied and pending special assessments and real estate taxes are not paid by any tenant of the Entire Property. (b) All income and all operating expenses from the Entire 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 its proportionate share of all income earned and shall be responsible for its proportionate share of all operating expenses of the Entire Property incurred on and after the date of closing. Buyer Initial: /s/ FQ /s/ CAQ Purchase Agreement for Marie Callender's - Henderson, NV 11. SELLER'S REPRESENTATION AND AGREEMENTS. (a) Seller represents and warrants as of this date that: (i) Except for the Lease Agreement in existence between AEI Net Lease Income & Growth Fund XIX Limited Partnership, AEI Income & Growth Fund XXII Limited Partnership (as "Landlord") and Marie Callender Pie Shops Inc.("Tenant"), dated September 27, 1999, Seller is not aware of any leases of the Property. The above referenced lease agreement has a right of first refusal in favor of the Tenant as set forth in Article 34 of said lease agreement, which right will apply to any attempted disposition of Property by Buyer after this transaction. (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 permitted 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. However, Buyer acknowledges that Seller retains the right both prior to and after the Closing Date to freely transfer all or a portion of Seller's remaining undivided interest in the Entire Property, provided such sale shall not encumber the Property being purchased by Buyer in violation of the terms hereof or the contemplated Co-Tenancy Agreement. 12. DISCLOSURES. (a) Seller has not received any notice of any material, physical, or mechanical defects of the Entire Property, including without limitation, the plumbing, heating, air conditioning, ventilating, electrical system. To the best of Seller's knowledge without inquiry, 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. If Seller shall receive any notice to the contrary prior to Closing, Seller will inform Buyer prior to Closing. (b) Seller has not received any notice that the use and operation of the Entire Property 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. If Seller shall receive any notice to the contrary prior to Closing, Seller will inform Buyer prior to Closing. (c) Seller knows of no facts nor has Seller failed to disclose to Buyer any fact known to Seller which would prevent the Tenant from using and operating the Entire Property after the Closing in the manner in which the Entire Property has been used and operated Buyer Initial: /s/ FQ /s/ CAQ Purchase Agreement for Marie Callender's - Henderson, NV prior to the date of this Agreement. If Seller shall receive any notice to the contrary prior to Closing, Seller will inform Buyer prior to Closing. (d) Seller has not received any notice that the Entire Property is in violation of any federal, state or local law, ordinance, or regulations relating to industrial hygiene or the environmental conditions on, under, or about the Entire 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 Entire 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 Entire Property after the Closing Date. Seller shall indemnify Buyer for any liability arising due to Hazardous Materials on or in connection with the Entire Property prior to the Closing Date. If Seller shall receive any notice to the contrary prior to Closing, Seller will inform Buyer prior to Closing. (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. (f) BUYER ACKNOWLEDGES THAT, HAVING BEEN GIVEN THE OPPORTUNITY TO INSPECT THE ENTIRE PROPERTY AND SUCH FINANCIAL INFORMATION ON THE LESSEE AND GUARANTORS OF THE LEASE AS BUYER OR ITS ADVISORS SHALL REQUEST, IF IN SELLER'S POSSESSION, 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 FURTHER ACKNOWLEDGES THAT THE INFORMATION PROVIDED AND TO BE PROVIDED BY SELLER WITH RESPECT TO THE PROPERTY, THE ENTIRE PROPERTY AND TO THE LESSEE AND GUARANTORS OF LEASE WAS OBTAINED FROM A VARIETY OF SOURCES AND SELLER NEITHER (A) HAS MADE INDEPENDENT INVESTIGATION OR VERIFICATION OF SUCH INFORMATION, OR (B) MAKES ANY REPRESENTATIONS AS TO THE ACCURACY OR COMPLETENESS OF SUCH INFORMATION EXCEPT AS HEREIN SET FORTH. THE SALE OF THE PROPERTY AS PROVIDED FOR HEREIN IS MADE ON AN "AS IS" BASIS, AND BUYER EXPRESSLY ACKNOWLEDGES THAT, IN CONSIDERATION OF THE AGREEMENTS OF SELLER HEREIN, EXCEPT AS OTHERWISE SPECIFIED HEREIN IN PARAGRAPH 11(A) AND (B) ABOVE AND THIS PARAGRAPH 12, 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, OR FITNESS FOR A PARTICULAR PURPOSE, IN RESPECT OF THE PROPERTY. The provisions (d) - (f) above shall survive Closing. 13. CLOSING. (a) Before the closing date, Seller will deposit into escrow an executed special warranty deed warranting title against lawful claims by, through, or under a conveyance Buyer Initial: /s/ FQ /s/ CAQ Purchase Agreement for Marie Callender's - Henderson, NV from Seller, but not further or otherwise, conveying insurable title of the Property to Buyer, subject to the exceptions contained in paragraph 8 above. (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 and Seller will be relieved of all obligations and will be entitled to retain all monies heretofore paid by the Buyer. In addition, Seller shall retain all remedies available to Seller at law or in equity. 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 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 Buyer Initial: /s/ FQ /s/ CAQ Purchase Agreement for Marie Callender's - Henderson, NV 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 is 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 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 ten-day period provided for above in this Subparagraph 16a 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 (pro-rata in relation to the Entire Property) resulting from said damage or destruction to the extent that the same are payable with respect to damage to the Property, subject to rights of any Tenant of the Entire Property. If the cost of repair is less than $10,000.00, 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 pro-rata in relation to the Entire Property, subject to rights of any Tenant of the Entire Property. (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. 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 the Seller's right, title, and interest in and to any award made, or to be made, in the condemnation proceeding pro-rata in relation to the Entire Property, subject to rights of any Tenant of the Entire Property. 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). Buyer Initial: /s/ FQ /s/ CAQ Purchase Agreement for Marie Callender's - Henderson, NV 17. BUYER'S 1031 TAX FREE EXCHANGE. While Seller acknowledges that Buyer is purchasing the Property as "replacement property" to accomplish a tax free exchange, Buyer acknowledges that Seller has made no representations, warranties, or agreements to Buyer or Buyer's agents that the transaction contemplated by the Agreement will qualify for such tax treatment, nor has there been any reliance thereon by Buyer respecting the legal or tax implications of the transactions contemplated hereby. Buyer further represents that it has sought and obtained such third party advice and counsel as it deems necessary in regards to the tax implications of this transaction. Buyer wishes to novate/assign the ownership rights and interest of this Purchase Agreement to Bay Title & Abstract, Inc., which will act as Accommodator to perfect the 1031 exchange by preparing an agreement of exchange of Real Property whereby Bay Title & Abstract, Inc., will be an independent third party purchasing the ownership interest in subject property from Seller and selling the ownership interest in subject property to Buyer under the same terms and conditions as documented in this Purchase Agreement. Seller consents to such assignments. Buyer asks the Seller, and Seller agrees to cooperate in the perfection of such an exchange if at no additional cost or expense to Seller or delay in time. Buyer hereby indemnifies and holds Seller harmless from any claims and/or actions resulting from said exchange. Pursuant to the direction of Bay Title & Abstract, Inc., Seller will deed the Property directly to Buyer. 18. 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 10 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 10 days following the delivery of the notice to the escrow agent, this Contract shall be cancelled. 19. 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. Buyer Initial: /s/ FQ /s/ CAQ Purchase Agreement for Marie Callender's - Henderson, NV (b) If this escrow has not closed by April 30, 2000, through no fault of Seller, Seller may either, at its election, extend the closing date or exercise any remedy available to it by law, including terminating this Agreement. (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 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: Robert P. Johnson AEI Income & Growth Fund XXII Limited Partnership 1300 Minnesota World Trade Center 30 E. 7th Street St. Paul, MN 55101 If to Buyer: Francis E. and Cecile Ann Quinn 510 West 4th Street Shawano, WI 54166 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. REST OF PAGE INTENTIONALLY LEFT BLANK. Buyer Initial: /s/ FQ /s/ CAQ Purchase Agreement for Marie Callender's - Henderson, NV IN WITNESS WHEREOF, the Seller and Buyer have executed this Agreement effective as of the day and year above first written. BUYER: Francis E. Quinn and Cecile Ann Quinn, husband and wife as survivorship marital property. By:/s/ Francis E Quinn 4/13/2000 Francis E. Quinn By:/s/ Cecile Ann Quinn 4-13-2000 Cecile Ann Quinn SELLER: AEI Income & Growth Fund XXII Limited Partnership By: AEI Fund Management XXI, Inc., its corporate general partner By:/s/ Robert P Johnson Robert P. Johnson, President Buyer Initial: /s/ FQ /s/ CAQ Purchase Agreement for Marie Callender's - Henderson, NV EXHIBIT "A" LEGAL DESCRIPTION (Henderson, Nevada) Being a division of Lot One (1) as shown upon the FINAL MAP OF GALLERIA COMMONS ( a commercial subdivision) as depicted in Book 79, Page 48 of Plats, Official Records, Clark County, Nevada, also being a portion of the West Half (W 1/2) of the Southwest Quarter (SW 1/4) of Section 3, Township 22 South, Range 62 East, M.D.M., City of Henderson, Clark County, Nevada, more particularly described as follows: Commencing at the West Quarter Corner (w 1/4 Cor.) of said Section 3, said corner being common to Sections 3 and 4; Thence South 00 14' 06" West along the West line of said Section 3, a distance of 808.13 feet; Thence North 88 55' 32" East, a distance of 50.01 fee to a point on the Easterly right of way line of Stephanie Street' Thence south 00 14' 06" West along said Easterly right of way line, a distance of 585.62 feet; Thence South 89 45' 54" East, a distance of 20.00 feet to the Point of Beginning; Thence North 88 51' 28" East, a distance of 147.22 feet; Thence South 01 05' 43" East, a distance of 108.33 feet; Thence South 88 51' 28" West, a distance of 2.92 feet; Thence South 89 56' 32" West, a distance of 149.41 feet; Thence North 00 14' 06" East, a distance of 284.89 feet to the POINT OF BEGINNING EX-10.9 10 PURCHASE AGREEMENT Hollywood Video - Saraland, AL This AGREEMENT, entered into effective as of the 18th of April, 2000. l. PARTIES. Seller is AEI Income & Growth Fund XXII Limited Partnership which owns an undivided 87.4708% interest in the fee title to that certain real property legally described in the attached Exhibit "A" (the "Entire Property") Buyer is Wuest Estate Company, A California Corporation ("Buyer"). Seller wishes to sell and Buyer wishes to buy a portion of Seller's tenant in common interest in the Entire Property. 2. PROPERTY. The Property to be sold to Buyer in this transaction consists of an undivided 12.5832 percentage interest (hereinafter, simply the "Property") as Tenant in Common in the Entire Property. 3. PURCHASE PRICE. The purchase price for this percentage interest in the Entire Property is $233,000, all cash. 4. TERMS. The purchase price for the Property will be paid by Buyer as follows: (a) When this agreement is executed, Buyer will pay $5,000 to Seller (which shall be deposited into escrow according to the terms hereof) (the "First Payment"). The First Payment will be credited against the purchase price when and if escrow closes and the sale is completed. (b) Buyer will deposit the balance of the purchase price, $228,000 (the "Second Payment") into escrow in sufficient time to allow escrow to close on the closing date. 5. CLOSING DATE. Escrow shall close on or before April 30, 2000. 6. DUE DILIGENCE. Buyer will have until the expiration of the tenth business day (The "Review Period") after delivery of all four of the 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 Entire Property or persons caused by Buyer or its agents arising out of such physical inspections of the Entire Property. (a) The original and one copy of a title insurance commitment for an Owner's Title insurance policy (see paragraph 8 below). (b) A copy 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. (c) A copy of an "as built" survey of the Entire Property done concurrent with Seller's acquisition of the Property. Buyer Initial: /s/ TGM /s/ STM Purchase Agreement for Hollywood Video, Saraland, AL (d) Lease (as further set forth in paragraph 11(a) below) of the Entire Property showing occupancy date, lease expiration date, rent, and Guarantys, if any, accompanied by such tenant financial statements as may have been provided most recently to Seller by the Tenant and/or Guarantors. It is a contingency upon Seller's obligations hereunder that two (2) copies of Co-Tenancy Agreement in the form attached hereto duly executed by Buyer and Seller and dated on escrow closing date be delivered to the Seller on the closing date. Buyer may cancel this agreement for ANY REASON in its sole discretion by delivering a cancellation notice, via first class mail, 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. If this Agreement is not cancelled as set forth above, the First Payment shall be non-refundable unless Seller shall default hereunder. If Buyer cancels this Agreement as permitted under this Section, except for any escrow cancellation fees and any liabilities under the first paragraph of sections 6 of this agreement (which will survive), Buyer (after execution of such documents reasonably requested by Seller to evidence the termination hereof) shall be returned its First Payment, and 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 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 a nationally-recognized escrow company selected by Seller. 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 commitment of a title company selected by Seller 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 insurable 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; all matters of public record as shown in the title commitment; and other items disclosed to Buyer during the Review Period. Buyer Initial: /s/ TGM /s/ STM Purchase Agreement for Hollywood Video, Saraland, AL Buyer shall be allowed ten (10) 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 insurable 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. 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 one-half of escrow fees, the cost of the title commitment and any brokerage commissions payable. 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 all recording fees, one-half of the escrow fees, and the cost of an update to the Survey in Sellers possession (if an update is required by Buyer.) 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 Entire Property (of which the Property is a part) 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. Unpaid real estate taxes and unpaid levied and pending special assessments existing on the date of Closing shall be the responsibility of Buyer and Seller in proportion to their respective Tenant in Common interests, pro-rated, however, to the date of closing for the period prior to closing, which shall be the responsibility of Seller if Tenant shall not pay the same. Seller and Buyer shall likewise pay all taxes due and payable in the year after Closing and any unpaid installments of special assessments payable therewith and thereafter, if such unpaid levied and pending special assessments and real estate taxes are not paid by any tenant of the Entire Property. (b) All income and all operating expenses from the Entire 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 its proportionate share of all income earned and shall be responsible for its proportionate share of all operating expenses of the Entire Property incurred on and after the date of closing. Buyer Initial: /s/ TGM /s/ STM Purchase Agreement for Hollywood Video, Saraland, AL 11. SELLER'S REPRESENTATION AND AGREEMents. (a) Seller represents and warrants as of this date that: (i) Except for the lease in existence between Centurion Video, LTD (as "Landlord") and Hollywood Entertainment Corporation ("as Tenant") dated September 27, 1997 and the assignment of lease from Centurion Video, LTD ("Centurion", Assignor") to AEI Income & Growth Fund XXII Limited Partnership ("AEI", "Assignee") dated January 12, 1999, Seller is not aware of any leases of the Property. (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 permitted 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. However, Buyer acknowledges that Seller retains the right both prior to and after the Closing Date to freely transfer all or a portion of Seller's remaining undivided interest in the Entire Property, provided such sale shall not encumber the Property being purchased by Buyer in violation of the terms hereof or the contemplated Co-Tenancy Agreement. 12. DISCLOSURES. (a) Seller has not received any notice of any material, physical, or mechanical defects of the Entire Property, including without limitation, the plumbing, heating, air conditioning, ventilating, electrical system. To the best of Seller's knowledge without inquiry, 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. If Seller shall receive any notice to the contrary prior to Closing, Seller will inform Buyer prior to Closing. (b) Seller has not received any notice that the use and operation of the Entire Property 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. If Seller shall receive any notice to the contrary prior to Closing, Seller will inform Buyer prior to Closing. (c) Seller knows of no facts nor has Seller failed to disclose to Buyer any fact known to Seller which would prevent the Tenant from using and operating the Entire Property after the Closing in the manner in which the Entire Property has been used and operated prior to the date of this Agreement. If Seller shall receive any notice to the contrary prior to Closing, Seller will inform Buyer prior to Closing. Buyer Initial: /s/ TGM /s/ STM Purchase Agreement for Hollywood Video, Saraland, AL (d) Seller has not received any notice that the Entire Property is in violation of any federal, state or local law, ordinance, or regulations relating to industrial hygiene or the environmental conditions on, under, or about the Entire 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 Entire 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 Entire Property either before or after the Closing Date, except such Hazardous Materials on or in connection with the Entire Property arising out of Seller's gross negligence or intentional misconduct. If Seller shall receive any notice to the contrary prior to Closing, Seller will inform Buyer prior to Closing. (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. (f) BUYER ACKNOWLEDGES THAT, HAVING BEEN GIVEN THE OPPORTUNITY TO INSPECT THE ENTIRE PROPERTY AND SUCH FINANCIAL INFORMATION ON THE LESSEE AND GUARANTORS OF THE LEASE AS BUYER OR ITS ADVISORS SHALL REQUEST, IF IN SELLER'S POSSESSION, 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 FURTHER ACKNOWLEDGES THAT THE INFORMATION PROVIDED AND TO BE PROVIDED BY SELLER WITH RESPECT TO THE PROPERTY, THE ENTIRE PROPERTY AND TO THE LESSEE AND GUARANTORS OF LEASE WAS OBTAINED FROM A VARIETY OF SOURCES AND SELLER NEITHER (A) HAS MADE INDEPENDENT INVESTIGATION OR VERIFICATION OF SUCH INFORMATION, OR (B) MAKES ANY REPRESENTATIONS AS TO THE ACCURACY OR COMPLETENESS OF SUCH INFORMATION EXCEPT AS HEREIN SET FORTH. THE SALE OF THE PROPERTY AS PROVIDED FOR HEREIN IS MADE ON AN "AS IS" BASIS, AND BUYER EXPRESSLY ACKNOWLEDGES THAT, IN CONSIDERATION OF THE AGREEMENTS OF SELLER HEREIN, EXCEPT AS OTHERWISE SPECIFIED HEREIN IN PARAGRAPH 11(A) AND (B) ABOVE AND THIS PARAGRAPH 12, 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, OR FITNESS FOR A PARTICULAR PURPOSE, IN RESPECT OF THE PROPERTY. The provisions (d) - (f) above shall survive Closing. 13. CLOSING. (a) Before the closing date, Seller will deposit into escrow an executed special warranty deed warranting title against lawful claims by, through, or under a conveyance from Seller, but not further or otherwise, conveying insurable title of the Property to Buyer, subject to the exceptions contained in paragraph 8 above. Buyer Initial: /s/ TGM /s/ STM Purchase Agreement for Hollywood Video, Saraland, AL (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 and Seller will be relieved of all obligations and will be entitled to retain all monies heretofore paid by the Buyer. In addition, Seller shall retain all remedies available to Seller at law or in equity. 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. Buyer Initial: /s/ TGM /s/ STM Purchase Agreement for Hollywood Video, Saraland, AL (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 is 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 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 ten-day period provided for above in this Subparagraph 16a 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 (pro-rata in relation to the Entire Property) resulting from said damage or destruction to the extent that the same are payable with respect to damage to the Property, subject to rights of any Tenant of the Entire Property. If the cost of repair is less than $10,000.00, 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 pro-rata in relation to the Entire Property, subject to rights of any Tenant of the Entire Property. (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. 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 the Seller's right, title, and interest in and to any award made, or to be made, in the condemnation proceeding pro-rata in relation to the Entire Property, subject to rights of any Tenant of the Entire Property. 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). Buyer Initial: /s/ TGM /s/ STM Purchase Agreement for Hollywood Video, Saraland, AL 17. BUYER'S 1031 TAX FREE EXCHANGE. While Seller acknowledges that Buyer is purchasing the Property as "replacement property" to accomplish a tax free exchange, Buyer acknowledges that Seller has made no representations, warranties, or agreements to Buyer or Buyer's agents that the transaction contemplated by the Agreement will qualify for such tax treatment, nor has there been any reliance thereon by Buyer respecting the legal or tax implications of the transactions contemplated hereby. Buyer further represents that it has sought and obtained such third party advice and counsel as it deems necessary in regards to the tax implications of this transaction. Buyer wishes to novate/assign the ownership rights and interest of this Purchase Agreement to Chicago Title Exchange Accommodator, Inc., which will act as Accommodator to perfect the 1031 exchange by preparing an agreement of exchange of Real Property whereby Chicago Title Exchange Accommodator, Inc., will be an independent third party purchasing the ownership interest in subject property from Seller and selling the ownership interest in subject property to Buyer under the same terms and conditions as documented in this Purchase Agreement. Seller consents to such assignments. Buyer asks the Seller, and Seller agrees to cooperate in the perfection of such an exchange if at no additional cost or expense to Seller or delay in time. Buyer hereby indemnifies and holds Seller harmless from any claims and/or actions resulting from said exchange. Pursuant to the direction of Chicago Title Exchange Accommodator, Inc., Seller will deed the Property directly to Buyer. 18. 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. 19. 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. This Agreement shall be governed by, and interpreted in accordance with, the laws of the State of Alabama. Buyer Initial: /s/ TGM /s/ STM Purchase Agreement for Hollywood Video, Saraland, AL (b) If this escrow has not closed by April 30, 2000, through no fault of Seller, Seller may either, at its election, extend the closing date or exercise any remedy available to it by law, including terminating this Agreement. (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 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: Robert P. Johnson AEI Income & Growth Fund XXII Limited Partnership 1300 Minnesota World Trade Center 30 E. 7th Street St. Paul, MN 55101 If to Buyer: Wuest Estate Company 1380-C Garnett Avenue San Diego, CA 92109 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. REST OF PAGE INTENTIONALLY LEFT BLANK Buyer Initial: /s/ TGM /s/ STM Purchase Agreement for Hollywood Video, Saraland, AL IN WITNESS WHEREOF, the Seller and Buyer have executed this Agreement effective as of the day and year above first written. BUYER: Wuest Estate Company, A California Corporation By:/s/ Thomas G Morton Thomas G. Morton, Senior Vice President By:/s/ Steve T Morton Steven T. Morton, Assistant Secretary SELLER: AEI Income & Growth Fund XXII Limited Partnership By: AEI Fund Management XXI, Inc., its corporate general partner By:/s/ Robert P Johnson Robert P. Johnson, President Buyer Initial: /s/ TGM /s/ STM Purchase Agreement for Hollywood Video, Saraland, AL EXHIBIT A Lot 1, WAL*MART SQUARE, according to the plat thereof recorded in Map Book 70, Page 25 of the probate Court Records of Mobile County, Alabama. EX-10.10 11 PROPERTY CO-TENANCY OWNERSHIP AGREEMENT (Hollywood Video, Saraland, AL) THIS CO-TENANCY AGREEMENT, Made and entered into as of the 21st day of April, 2000, by and between Wuest Estate Company, A California Corporation (hereinafter called "Wuest") and AEI Income & Growth Fund XXII Limited Partnership (hereinafter called "Fund XXII") (Wuest, Fund XXII (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 74.8876% interest in and to, and Wuest presently owns an undivided 12.5832% interest in and to, and Carl R. Whittington, Trustee of the Carl R. Whittington Trust, dated October 16, 1996 presently owns an undivided 12.5292% interest in and to the land, situated in the City of Saraland, County of Mobile, and State of AL, (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 operation and management of the Premises and Wuest's interest by Fund XXII; the continued leasing of space within the Premises; for the distribution of income from and the pro-rata sharing in expenses of the Premises. NOW THEREFORE, in consideration of the purchase by Wuest 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. The operation and management of the Premises shall be delegated to Fund XXII, or its designated agent, successors or assigns. Provided, however, if Fund XXII shall sell all of its interest in the Premises, the duties and obligations of Fund XXII respecting management of the Premises as set forth herein, including but not limited to paragraphs 2, 3, and 4 hereof, shall be exercised by the holder or holders of a majority undivided co- tenancy interest in the Premises. Except as hereinafter expressly provided to the contrary, each of the parties hereto agrees to be bound by the decisions of Fund XXII with respect to all administrative, operational and management matters of the property comprising the Premises, including but not limited to the management of the net lease agreement for the Premises. Wuest hereto hereby designates Fund XXII as its sole and exclusive agent to deal with, and Fund XXII retains the sole right to deal with, any property agent or tenant and to negotiate and enter into, on terms and provisions satisfactory to Fund XXII, monitor, execute and enforce the terms of leases of space within the Premises, including but not limited to any amendments, consents to assignment, sublet, releases or modifications to leases or guarantees of lease or easements affecting the Premises, on behalf Co-Tenant Initial: /s/ TGM /s/ STM Co-Tenancy Agreement for Hollywood Video, Saraland, AL of Wuest As long as Fund XXII owns an interest in the Premises, only Fund XXII may obligate Wuest with respect to any expense for the Premises. As further set forth in paragraph 2 hereof, Fund XXII agrees to require any lessee of the Premises to name Wuest as an insured or additional insured in all insurance policies provided for, or contemplated by, any lease on the Premises. Fund XXII 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, Fund XXII 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. Fund XXII may offset against, pay to itself and deduct from any payment due to Wuest under this Agreement, and may pay to itself the amount of Wuest 's share of any reasonable expenses of the Premises which are not paid by Wuest to Fund XXII or its assigns, within ten (10) days after demand by Fund XXII. In the event there is insufficient operating income from which to deduct Wuest's unpaid share of operating expenses, Fund XXII 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 tenant under terms of any lease agreement of the Premises. Wuest has no requirement to, but has, nonetheless elected to retain, and agrees to annually reimburse, Fund XXII in the amount of $571 for the expenses, direct and indirect, incurred by Fund XXII in providing Wuest with quarterly accounting and distributions of Wuest 's share of net income and for tracking, reporting and assessing the calculation of Wuest 's share of operating expenses incurred from the Premises. This invoice amount shall be pro-rated for partial years and Wuest authorizes Fund XXII to deduct such amount from Wuest's share of revenue from the Premises. Wuest 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; however, enforcement of all other provisions of the lease remains the sole right of Fund XXII pursuant to Section 1 hereof. Fund XXII may terminate its obligation under this paragraph upon 30 days notice to Wuest 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 Fund XXII'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, Fund XXII shall prepare an accurate income statement for the ownership of the Premises for said calendar Co-Tenant Initial: /s/ TGM /s/ STM Co-Tenancy Agreement for Hollywood Video, Saraland, AL year and shall furnish copies of the same to all Co-Tenants. Quarterly, as its share, Wuest shall be entitled to receive 12.5832% 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 therefor from Fund XXII, shall, within fifteen (15) business days after receipt of notice, make payment to Fund XXII 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. 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. 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 January 30, 2033 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 Premises and with the title thereto. Once any person, party or entity has ceased to have an interest in fee in any portion of the Premises, 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. 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; Co-Tenant Initial: /s/ TGM /s/ STM Co-Tenancy Agreement for Hollywood Video, Saraland, AL If to Fund XXII: AEI Income and Growth Fund XXII Limited Partnership 1300 Minnesota World Trade Center 30 E. Seventh Street St. Paul, Minnesota 55101 If to Wuest: Wuest Estate Company 1380-C Garnett Avenue San Diego, CA 92109 If to Whittington: Carl R. Whittington, Trustee 1440 Elm Grove Avenue Akron, OH 44312 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. 9. This Agreement shall not create any partnership or joint venture among or between the Co-Tenants or any of them, and 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. REST OF PAGE INTENTIONALLY LEFT BLANK Co-Tenant Initial: /s/ TGM /s/ STM Co-Tenancy Agreement for Hollywood Video, Saraland, AL IN WITNESS WHEREOF, The parties hereto have caused this Agreement to be executed and delivered, as of the day and year first above written. Wuest: Wuest Estate Company, A California Corporation By:/s/ Thomas G Morton Thomas G. Morton, Senior Vice President By: /s/ Steven T Morton Steven T. Morton, Assistant Secretary STATE OF CALIFORNIA) ) ss COUNTY OF SAN DIEGO) I, a Notary Public in and for the state and county of aforesaid, hereby certify there appeared before me this 17th day of April, 2000, Thomas G. Morton, Senior Vice President and Steven T. Morton, Assistant Secretary, who executed the foregoing instrument in said capacity. /s/ Angela Ponce DeLeon Notary Public [notary seal] Co-Tenant Initial: /s/ TGM /s/ STM Co-Tenancy Agreement for Hollywood Video, Saraland, AL Fund XXII: AEI Income & Growth Fund XXII Limited Partnership By: AEI Fund Management XXI, Inc., its corporate general partner By:/s/ Robert P Johnson Robert P. Johnson, President State of Minnesota ) ) ss. County of Ramsey ) I, a Notary Public in and for the state and county of aforesaid, hereby certify there appeared before me this 21st day of April, 2000, Robert P. Johnson, President of AEI Fund Management XXI, Inc., corporate general partner of AEI Income & Growth Fund XXII Limited Partnership, who executed the foregoing instrument in said capacity and on behalf of the corporation in its capacity as corporate general partner, on behalf of said limited partnership. /s/ Linda A Bisdorf Notary Public [notary seal] Co-Tenant Initial: /s/ TGM /s/ STM Co-Tenancy Agreement for Hollywood Video, Saraland, AL EXHIBIT A Lot 1, WAL*MART SQUARE, according to the plat thereof recorded in Map Book 70, Page 25 of the probate Court Records of Mobile County, Alabama. EX-27 12
5 0001023458 AEI INCOME & GROWTH FUND XXII LTD PARTNERSHIP 3-MOS DEC-31-2000 MAR-31-2000 1,969,440 0 0 0 0 1,969,440 11,977,273 (264,944) 13,681,769 419,710 0 0 0 0 13,262,059 13,681,769 0 304,440 0 139,684 0 0 0 386,176 0 386,176 0 0 0 386,176 22.29 22.29
-----END PRIVACY-ENHANCED MESSAGE-----