Document:

PURCHASE AGREEMENT
                        Hops Grill & Bar
                      Palm Harbor, Florida

This  AGREEMENT,  entered into effective as of the  6th  of  May,
2002.

l.   PARTIES.  Seller  is  AEI  Real  Estate  Fund  85-A  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  "Property")   Buyer   is   Schmitz
Development Company, an Illinois corporation.  Seller  wishes  to
sell and Buyer wishes to buy the Property.

2. PROPERTY. The Property to be sold to Buyer in this transaction
consists  of  an undivided 100% percentage interest (hereinafter,
simply the "Property").

3.  PURCHASE  PRICE.  The  purchase  price  for  this  percentage
interest in the Property is $1,118,000 (one million, one  hundred
and two thousand and no/100 dollars), 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  $50,000
         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,
         $1,052,000  (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 June 15, 2002.

6. DUE DILIGENCE. Buyer will have until the expiration of fifteen
business  days (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
Property or persons caused by Buyer or its agents arising out  of
such physical inspections of the Property.

     (a) 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 Property as are in Seller's
         possession.

     (c) A  copy  of an "as built" survey of the Property  done
         concurrent with Seller's acquisition of the Property.

     (d) Lease (as further set forth in paragraph 11(a) below) of the
         Property showing occupancy date, lease expiration date, rent,
         and Guarantees, if any, accompanied by such tenant  financial
         statements as may have been provided most recently to Seller
         by the Tenant and/or Guarantors.

Buyer Initial: /s/ JWS
Purchase Agreement for Hops Grill, Palm Harbor, FL

      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  First
Payment  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;
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 will 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  Seller will pay the cost of  issuing  a  Standard

Buyer Initial: /s/ JWS
Purchase Agreement for Hops Grill, Palm Harbor, FL

Owners  Title Insurance Policy in the full amount of the purchase
price.   Buyer  will pay all recording fees, transfer  taxes  and
clerk's fees imposed upon the recording of the deed, 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 Property is subject to a triple  net  lease
     (as  further  set forth in paragraph 11(a)(i),  the  parties
     acknowledge  that there shall be no need for a  real  estate
     tax proration.  However, Seller warrant that 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,  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. 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 Property.

     (b)  All income and all operating expenses from the Property
     shall  be prorated between the parties and adjusted by  them
     as  of the date of Closing.  Seller shall be entitled to all
     income  earned  and shall be responsible  for  all  expenses
     incurred  prior to the date of Closing, and Buyer  shall  be
     entitled  to all income earned and shall be responsible  for
     all operating expenses of the Property incurred on and after
     the date of closing.

11.  SELLER'S REPRESENTATION AND AGREEMENTS.

     (a)  Seller represents and warrants as of this date that:

     (i)  Except for the Lease Agreement in existence between AEI Real
          Estate Fund 85-A Limited Partnership (as Lessor) and Hops Grill &
          Bar, Inc. (as Tenant), dated January 2, 1992, and amended on
          December 19, 2001 (the "Lease"), Seller is not aware of any
          leases of the Property.

     (ii) The Lease contains a Right of First Refusal for the benefit
          of the Lessee for the duration of the Lease, including any
          renewal  terms, which right will apply to any attempted
          disposition of Property by Buyer after this transaction.  This
          purchase agreement is contingent upon Seller receiving signed
          waiver of Right of First Refusal from Lessee.

    (iii) It  is  not  aware of any pending  litigation  or
          condemnation proceedings against the Property or Seller's
          interest in the Property.

     (iv) 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.

Buyer Initial: /s/ JWS
Purchase Agreement for Hops Grill, Palm Harbor, FL

12.  DISCLOSURES.

     (a)   Seller  has not received any notice of  any  material,
     physical,  or mechanical defects of the Property,  including
     without limitation, the plumbing, heating, air conditioning,
     and  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 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  Property
     after  the  Closing in the manner in which the 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.

     (d)  Seller has not received any notice that the 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  Property,
     including,   but  not  limited  to,  soil,  and  groundwater
     conditions.  To the best of Seller's knowledge, there is  no
     proceeding  or  inquiry by any governmental  authority  with
     respect  to  the  presence  of Hazardous  Materials  on  the
     Property or the migration of Hazardous Materials from or  to
     other  property.   Buyer agrees that  Seller  will  have  no
     liability  of  any  type  to Buyer  or  Buyer's  successors,
     assigns,  or  affiliates in connection  with  any  Hazardous
     Materials  on  or  in  connection with the  Property  either
     before  or  after  the Closing Date, except  such  Hazardous
     Materials on or in connection with the Property arising  out
     of  Seller's 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 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
     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,

Buyer Initial: /s/ JWS
Purchase Agreement for Hops Grill, Palm Harbor, FL

     SUITABILITY  FOR  COMMERCIAL PURPOSES,  MERCHANTABILITY,  OR
     FITMESS  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.  Seller will also deliver  an  Estoppel
     Certificate certified by Seller as to the absence  of  known
     defaults by Lessee and Lessor under the Lease

     (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 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.

Buyer Initial: /s/ JWS
Purchase Agreement for Hops Grill, Palm Harbor, FL

     (ii)   Buyer  has  all  requisite  power  and  authority  to
     consummate  the  transaction contemplated by this  Agreement
     and  has by proper proceedings duly authorized the execution
     and  delivery of this Agreement and the consummation of  the
     transaction contemplated hereby.

     (iii)   To  Buyer's  knowledge, neither  the  execution  and
     delivery  of  this  Agreement nor the  consummation  of  the
     transaction  contemplated  hereby  will  violate  or  be  in
     conflict with (a) any applicable provisions of law, (b)  any
     order  of  any  court or other agency of  government  having
     jurisdiction  hereof, or (c) any agreement or instrument  to
     which Buyer is a party or by which Buyer is bound.

16.  DAMAGES, DESTRUCTION AND EMINENT DOMAIN.

     (a)   If, prior to closing, the Property or any part thereof
     be  destroyed  or further damaged by fire, the elements,  or
     any cause, due to events occurring subsequent to the date of
     this Agreement to the extent that the cost of repair exceeds
     $10,000.00,  this Agreement shall become null and  void,  at
     Buyer's  option exercised, if at all, by written  notice  to
     Seller within ten (10) days after 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  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 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
     Property, subject to rights of any Tenant of the 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 Property, subject to rights of any Tenant
     of the 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 contemplated hereby.  Buyer further represents  that

Buyer Initial: /s/ JWS
Purchase Agreement for Hops Grill, Palm Harbor, FL

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 Martin Engels,  P.A.  who
will  act  as  Accommodator  to  perfect  the  1031  exchange  by
preparing  an  agreement  of exchange of  Real  Property  whereby
Martin Engels, P.A. 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 Martin Engels,
P.A. 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 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.

     (b)   If this escrow has not closed by June 15, 2002 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.

Buyer Initial: /s/ JWS
Purchase Agreement for Hops Grill, Palm Harbor, FL

     If to Seller:

          AEI Real Estate Fund 85-A Limited Partnership
          1300 Minnesota World Trade Center
          30 East Seventh Street
          St. Paul, MN 55101

     If to Buyer:

          John Schmitz
          Schmitz Development Company
          1101 Brickell Avenue, Suite 1700
          Miami, Florida 33131

     (e) In accordance with, and pursuant to, the provisions of
         Section 404.056, Florida Statutes, the following provision is
         included herein:

        "RADON GAS: Radon is a naturally occurring radioactive
        gas that, when it has accumulated in a building in
        sufficient quantities, may present health risks to
        persons who are exposed to it over time.  Levels of
        radon that exceed federal and state guidelines have been
        found in buildings in Florida.  Additional information
        regarding radon and radon testing may be obtained from
        you county health department."

      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.

      This  Agreement  shall be governed by, and  interpreted  in
accordance with, the laws of the state of  Florida.

      IN WITNESS WHEREOF, the Seller and Buyer have executed this
Agreement effective as of the day and year above first written.

BUYER:    Schmitz Development Company, an Illinois Corporation

          By:/s/ John W Schmitz
                 John W. Schmitz, its President

Buyer Initial: /s/ JWS
Purchase Agreement for Hops Grill, Palm Harbor, FL

SELLER:   AEI NET REAL ESTATE FUND 85-A LIMITED PARTNERSHIP, a
          Minnesota limited partnership

           By:   NET  LEASE  MANAGEMENT 85-A, INC.,  a  Minnesota
corporation

           By:/s/ Robert P Johnson
                  Robert P. Johnson, its President

      (THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK)

Buyer Initial: /s/ JWS
Purchase Agreement for Hops Grill, Palm Harbor, FL

     May 6, 2002                                          VIA FEDEX

     Ms. Debra Jochum
     AEI Fund Management, Inc.
     1300 Minnesota World Trade Center
     30 Seventh Street East
     St. Paul, MN  55101-4901

     Re:  Hops Grill & Bar, Palm Harbor, FL
          AEI Real Estate Fund 85-A Limited Partnership ("Seller")
          Schmitz Development Company ("Buyer")

     Dear Ms. Jochum:

     In  response to your May 1, 2002 letter and our conversation
     today,  please  find  enclosed two copies  of  the  Purchase
     Agreement  executed  by  Schmitz Development  Company.   Our
     facilitator's  $50,000 check will be sent by FedEx  tomorrow
     to Lawyers Title.

     The   name  of  the  facilitator  is  Martin  Engels,   P.A.
     International  Plaza,  100  S.E. 2nd  Street,  Street  2150,
     Miami, FL 33131.  Telephone (305) 373-2700.  Fax: (305) 577-
     3558.

     Pursuant  to our conversation, this letter shall act  as  an
     amendment to the Purchase Agreement through the addition  of
     the following provisons:

       1.Due to an error in the statement of rent, the parties have
         agreed to adjust the purchase price so that shall be One Million
         One Hundred Eighteen Thousand Dollars ($1,118,000.00), instead of
         One Million One Hundred and Two Thousand Dollars ($1,102,000.00).

       2.The escrow agent shall be Lawyers Title (Attention: Anne
         Bostick), located at 3636 Central Avenue, Phoenix, AZ  85012
         Telephone: (800) 523-0358   Fax:  (602) 287-3571

       3.As a condition of closing, Seller shall provide Buyer with
         an Estoppel Certificate from Lessee (referred to as "Tenant" in
         the First Amendment to Lease") that:
         (a)  complies  with  Article  25  of  the  Net  Lease
         Agreement dated January 2, 1992;
         (b)  confirms  the Net Lease Agreement dated  January
         2, 1992;
         (c)  confirms the Assignment and Assumption of  Lease
         Agreement dated March 14, 1997;
         (d)  confirms  the  First Amendment  to  Lease  dated
         December 19, 2001;
         (e)  states  that  said Amendment  provides  for  the
         Tenant   to  pay  a  current  annual  net   rent   of
         $96,437.79, plus 3% annual increases;
         (f)  states  that the current term commenced  May  1,
            2002,  expires April 30, 2014, and is subject to  the
            Lessee's   three  consecutive  five-year  option   to
            renew;

       4.   As a condition of closing, Seller shall provide Buyer with
            an Estoppel Certificate from Guarantor, Avado Brands, Inc., (a
            Georgia corporation formerly known as Apple South, Inc.) that
            confirms the guarantee of Lease dated March 13, 1997 with respect
            to the Net Lease Agreement dated January 2, 1992.

       5.   As a condition of closing, Seller shall provide Buyer with a
            Waiver of First Right of Refusal from Hops Grill & Bar, Inc., as
            to the sale of the property to Schmitz Development Company at a
            price of $1,118,000.

       6.   Article 6(G) of the Net Lease Agreement provides that Lessee
            shall pay Lessor sales taxes.  Article 34 of the Net Lease
            Agreement provides that Lessee shall deposit with Lessor each and
            every month an amount equal to one-twelfth (1/12) fo the
            estimated annual real estate taxes and assessments.  In the event
            that on the date of closing Seller shall have any sum(s) as a
            result of Article 6(G) and /or Article 34, Buyer shall receive a
            credit for these sum(s) on the closing statement.

       7.   The legal description of the Property is set forth on the
            page attached hereto as Exhibit

     If  the foregoing meets with your approval, please sigh  and
return one copy of this letter with a fully executed copy of  the
Purchase Agreement.

     Sincerely,

     SCHMITZ DEVELOPMENT COMPANY

     /s/ John W Schmitz
     John W Schmitz
     President

     Re:  Hops Grill & Bar, Palm Harbor, Florida
          AEI Real Estate Fund 85-A Limited Partnership ("Seller")
          Schmitz Development Company ("Buyer")

     Terms of May 6, 2002 letter modifying Purchase Agreement are
hereby approved and agreed to by:

     SELLER: AEI NET LEASE REAL ESTATE FUND 85-A LIMITED PARTNERSHIP,
             A Minnesota limited partnership

     BY:     NET LEASE  MANAGEMENT, 85-A, INC.,  a  Minnesota
             corporation

     BY: /s/ Robert P Johnson
             Robert P Johnson, its President

                           Exhibit "A"
                        Legal Description

     Hops-Palm Harbor, Florida

     A  part of the Southeast 1/4 of the Southwest 1/4 of SECTION
6,  TOWNSHIP  28 SOUTH, RANGE 16 EAST, Pinellas County,  Florida,
being described as follows;

     Beginning  at the Southwest corner of the Southeast  1/4  of
the  Southwest 1/4 of said Section 6, run North 85 34'  52"  West
100.53  feet  to  a point on the Westerly right of  way  of  U.S.
Highway 19; thence North 1 28' 23" West, along said right of  way
429.75 feet for a Point of Beginning; thence continue North 1 28'
23" West, along said of right of way 150.00 feet; thence North 87
28'  23"  West, 300.74 feet; thence South 1 28' 23" East,  150.00
feet;  thence South 87 28' 23" East, 300.74 feet to the Point  of
Beginning.<PAGE>
                                                                   EXHIBIT 10.25

                 SEPARATION AGREEMENT AND MUTUAL GENERAL RELEASE

      This Separation Agreement and Mutual General Release ("Agreement") is
entered into by and between Drew Q. Miller ("Miller") and Assisted Living
Concepts, Inc. ("ALC"), (collectively the "Parties").

      WHEREAS Miller is employed by ALC as its Chief Financial Officer;

      WHEREAS the Parties wish to terminate the Parties' respective rights,
obligations, and liabilities to each other including but not limited to those
arising under the Amended and Restated Employment Agreement signed by Miller on
December 6, 2001 ("Employment Agreement");

      WHEREAS the Parties have agreed to settle and compromise all claims and
disputes between them, whether known or unknown, on the terms set forth below.

      NOW, THEREFORE, THE PARTIES HEREBY AGREE AS FOLLOWS:

      1. The Parties agree that Miller shall submit his resignation and that his
employment with ALC shall terminate effective May 9, 2002 (the "Separation
Date"). Miller's resignation shall include resignation from any other positions
he might hold with ALC including, but not limited to, director, officer,
trustee, and committee member.

      2. At the request of the Chief Executive Officer of ALC ("CEO"), Miller
promptly shall deliver his resignation prior to the Separation Date. Such
earlier resignation shall not, however, affect Miller's right to receive his
base salary and employee benefits through the Separation Date. Commencing on
April 25, 2002, Miller may also discontinue active service to ALC on a full-time
basis without any loss of his base salary or benefits through the Separation
Date provided that, through the Separation Date, Miller shall be available to
participate in meetings and phone calls if and as requested by the CEO.

<PAGE>

      3. Miller shall be entitled to continue to receive the equivalent of his
base salary (less applicable taxes) until November 9, 2002. These Separation
Payments shall be made in equal installments at the time and in accordance with
ALC's normal payroll process, starting with the first pay period following the
eighth (8th) day after the execution of this Agreement by both Parties.

      4. ALC will continue to provide health insurance to Miller on the same
terms he had as an employee of ALC until November 9, 2002. After November 9,
2002, Miller may exercise any rights he may have to continue health insurance
under COBRA and/or its State counterpart.

      5. Miller shall also be entitled to receive a lump sum payment of
twenty-five thousand dollars ($25,000.00) as relocation expenses. This
relocation payment shall be made on November 16, 2002. Miller shall be
responsible for any taxes associated with the relocation payment and will
indemnify and hold ALC harmless against any such tax claim.

      6. Miller shall not accrue or be entitled to any other wages, salary,
benefits, commissions, bonuses, fees, options, or any other form of compensation
or remuneration of any kind from ALC and/or the Released Parties, other then his
accrued PTO.

      7. Except as otherwise required by law, the Parties agree that the
Employment Agreement and all other agreements and understandings, express or
implied, verbal or written, between the Parties are hereby terminated, null, and
void, provided, however, that Miller will continue to be bound by the
Confidential Information, Property of the Company, and Rights and Remedies Upon
Breach provisions of section 17(a)(1) and (2) and section 17(b) of the
Employment Agreement, according to the terms thereof, and that only those
provisions will survive the termination of the Employment Agreement.

                                       2
<PAGE>
      8. Miller agrees that he may not and will not file any future claims
against ALC and/or the Released Parties, except any claim for arbitration to
enforce this Agreement.

      9. Other than with respect to the obligations assumed in this Agreement,
and in consideration of the mutual releases and covenants contained herein,
Miller hereby releases and discharges ALC, its officers, directors, agents,
shareholders, employees, attorneys, affiliates, subsidiaries, related or parent
entities, successors, heirs and assigns ("Released Parties"), from any and all
liability, claims, counterclaims, demands, debts, charges, liens, and causes of
action of every kind and character, known or unknown, accrued or unaccrued,
liquidated or unliquidated, asserted or unasserted, whether arising out of
contract, tort, or otherwise, in law or in equity, arising, accruing, or based
on any conduct occurring at any time prior to the date of this Agreement,
including but not limited to all claims, counterclaims, and causes of action
that relate in any way to Miller's employment at ALC, the Employment Agreement,
or any other actual or alleged agreements or understandings between the Parties.
Without limiting the general nature of this release, Miller understands that he
waives all rights and releases the Released Parties from all claims of
discrimination under the Age Discrimination in Employment Act, Americans with
Disabilities Act, Title VII of the Civil Rights Act of 1964, as amended, the
federal Family Medical Leave Act, the Employee Retirement Income Security Act,
and/or any other federal, state, or local statute, ordinance, rule, regulation,
or executive order relating to employment, termination from employment, or
discrimination in employment. This release also applies to any other claim for
wrongful discharge, intentional infliction of emotional distress, libel or
slander, breach of express or implied contract or under any other theory of
recovery whether based upon statute, tort or otherwise. Nothing in this
Agreement shall relieve the

                                       3
<PAGE>
Company from any obligation it may have to defend and indemnify Miller against
any claims against Miller based on conduct within the scope of his employment.

      10. Other than with respect to the obligations assumed in this Agreement,
and in consideration of the mutual releases and covenants contained herein, ALC,
on behalf of itself and its officers, directors, and employees, hereby releases
and discharges Miller from any and all liability, claims, counterclaims,
demands, debts, charges, liens, and causes of action of every kind and
character, known or unknown, accrued or unaccrued, liquidated or unliquidated,
asserted or unasserted, whether arising out of contract, tort, or otherwise, in
law or in equity, arising, accruing, or based on any conduct occurring at any
time prior to the date of this Agreement, including but not limited to all
claims, counterclaims, and causes of action that relate in any way to Miller's
employment at ALC, the Employment Agreement, or any other actual or alleged
agreements or understandings between the Parties.

      11. Nothing in this Agreement or otherwise shall be deemed an admission of
liability by any Party.

      12. Miller will keep the terms of this Agreement confidential and will not
disclose the terms hereof other than to his attorney, accountant, tax adviser,
or as required by law.

      13. Except as provided otherwise in Section 17(b) of the Employment
Agreement and herein, any and all disputes or controversies arising out of or
relating to this Agreement, shall be resolved by arbitration at the office of
the American Arbitration Association nearest to ALC's executive offices at such
time before a panel of one arbitrator under the then existing rules and
regulations of the American Arbitration Association. The arbitrator will be
chosen by mutual agreement by Miller and ALC. The parties agree that in any such
arbitration, the arbitrator shall not have the power to reform or modify this
Agreement in any way and to that extent their

                                       4
<PAGE>
powers are so limited. The determination of the arbitrator shall be final and
binding on the parties hereto and judgment on it may be entered in any court of
competent jurisdiction. Except as required by law or as determined to be
appropriate disclosure by ALC under applicable securities laws or stock exchange
regulations, neither ALC nor Miller shall issue any press release or make any
statement which is reasonably foreseeable to become public with respect to any
arbitration or dispute between the parties without receiving the prior written
consent of the other party to the content of such press release or statement.
ALC and Miller shall share the cost of the arbitration proceeding equally. The
arbitrator shall not have discretion to award the prevailing party its costs,
fees, and expenses incurred in enforcing the terms of this Agreement.

      14. The Parties agree to use their best efforts to develop a public
announcement of Miller's separation of employment with ALC and agree not to
disparage each other. The Parties understand that ALC has the responsibility and
the authority to issue a public announcement even absent an agreement on its
precise language. The announcement will be placed in Miller's personnel file for
use in response to reference inquiries. Miller agrees to cooperate and assist
ALC in effecting a smooth transition. In addition, in the event that ALC shall
request that Miller be available to assist ALC or testify in connection with any
legal proceedings following the Separation Date, ALC shall reimburse Miller for
his reasonable out-of-pocket expenses incurred in connection therewith.

      15. If any term or provision of this Agreement is deemed to be
unenforceable or void for any reason, including reasons of overbreadth,
unconscionability, illegality, overreaching, or otherwise, all other terms and
provisions of this Agreement shall remain valid and enforceable according to
their terms.

                                       5
<PAGE>
      16. This Agreement shall be construed and enforced according to Oregon law
and shall be interpreted without reference to which Party is the "drafter" of
the document.

      17. This Agreement may be executed in counterparts and, when so executed,
the counterparts together shall constitute a single entire Agreement. A
facsimile signature shall have the same effect as an original.

      18. This Agreement constitutes the entire agreement of the Parties with
respect to the subject matter hereof and cannot be modified or amended except in
writing signed by each of the Parties. Except as provided herein, this Agreement
supercedes and replaces all prior representations, statements, promises,
commitments, and agreements between the Parties whether oral or written,
expressed or implied, and related to any subject matter.

      19. For purposes of this Agreement, ALC shall be defined to include the
Released Parties.

      20. Miller acknowledges and agrees that: (a) he has read this Agreement,
understands its contents and agrees to its terms and conditions of his own free
will; (b) he has reviewed this Agreement with an attorney prior to signing; (c)
he has had sufficient time to consider the Agreement prior to signing; (d) the
Agreement was negotiated freely and fairly between the Parties; (e) he has
twenty-one (21) days in which to decide whether to sign this Agreement; and (f)
after he signs this Agreement, he will have seven (7) days to decide whether to
revoke this Agreement.

                                       6
<PAGE>
      Agreed to this _____ day of April, 2002.

                                       Assisted Living Concepts, Inc.

                                       By:   /s/ Steven L. Vick
---------------------------------            -----------------------------------
Drew Q. Miller
                                       Its:  President/CEO
                                             -----------------------------------

                                       7

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