AGREEMENT FOR EXCHANGE OF LIKE-KIND PROPERTY
THIS AGREEMENT FOR EXCHANGE OF LIKE-KIND PROPERTY (this "Agreement") is dated as of
___________________, _________ and is by and between ___________________________________,a ________________,
taxpayer identification number ________________ ("Exchangor"), and BOKF, NA DBA BANK OF ARIZONA, a national
banking association ("Exchange Intermediary").
R E C I T A L S:
A.
Exchangor owns an interest in the property or properties described in Exhibit A attached hereto
(whether one or more, the "Exchange Property") and wishes to exchange the Exchange Property for one or more likekind properties (whether one or more, the "Qualified Replacement Property").
B.
Exchangor intends to enter into a tax-deferred exchange to exchange the Exchange Property for
Qualified Replacement Property pursuant to Section 1031 of the Internal Revenue Code, as amended (the "Code")
and the applicable Treasury Regulations promulgated under the Code contained in 26 CFR, Part 1 (the "Treasury
Regulations").
C.
Exchange Intermediary intends to serve as a "qualified intermediary" as such term is defined in the
Treasury Regulations and handle the exchange of the Exchange Property for the Qualified Replacement Property.
NOW, THEREFORE, in consideration of the foregoing, the parties hereby agree as follows:
ARTICLE I
TERMS AND CONDITIONS
1.1
Agreement to Assign and Reconvey. Exchangor agrees to sell its rights and interests in the Exchange
Property, free of its liabilities and obligations with respect thereto, to Exchange Intermediary and Exchange Intermediary
agrees to acquire such interests in the Exchange Property, free of such liabilities and obligations, from Exchangor and to
transfer and convey the Exchange Property to a purchaser, all pursuant to the terms and conditions of this Agreement.
1.2
Procedure for Exchange. To effect the exchange of the Exchange Property for the Qualified Replacement
Property in accordance with Treasury Regulation §1.1031(k)-1(g)(4), the parties shall adhere to the following procedures:
A.
Exchangor has entered or will enter into one or more sales contracts (whether one or more, the
“Sales Contract”) providing for the sale of the Exchange Property. Exchangor assigns all of its rights and interests in
the Sales Contract, free of its liabilities and obligations with respect thereto, to Exchange Intermediary on the
Exchange Conveyance Date (hereinafter defined). Exchangor shall give written notice of such assignment to all
parties to any Sales Contract on or before the Exchange Conveyance Date.
B.
Exchangor shall transfer and convey title to the Exchange Property directly to a buyer (the date of
such transfer and conveyance of title, herein called the "Exchange Conveyance Date") pursuant to the Sales Contract
and this Agreement and such buyer shall pay directly to Exchange Intermediary the consideration therefor which
would have otherwise been payable to Exchangor if such assignment set forth in Section 1.2A hereof had not been
made, which consideration shall be payable in cash (the "Cash Consideration") and, if otherwise specified in writing
by Exchangor and consented to by Exchange Intermediary in its sole discretion, such other consideration so specified
by Exchangor (the “Non-Cash Consideration”).
1.3
Investment of Cash Purchase Price. Exchange Intermediary shall deposit the Cash Consideration
received in a segregated interest bearing account (the "Exchange Account") at BOKF, NA DBA BANK OF ARIZONA unless
Exchangor gives Exchange Intermediary written instructions acceptable to Exchange Intermediary to invest the Cash
Consideration in an alternate investment or investments, whereupon the Exchange Intermediary shall invest the Cash
Consideration as so directed, and shall hold such Cash Consideration, any and all interest and other earnings thereon, and any
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Non-Cash Consideration (collectively, the “Exchange Account Funds”) until such time as the Exchange Account Funds are
required to be disbursed hereunder. The Exchange Account Funds shall constitute the subject matter of this Agreement.
1.4
Qualified Replacement Property.
A.
The closing under a contract for purchase of Qualified Replacement Property (whether one or
more, a "QRP Contract") shall occur not later than (such date herein called the "Replacement Date") the earlier of (i)
180 days from the Exchange Conveyance Date, or (ii) Exchangor's due date (including extensions) for filing its
United States federal income tax return for the taxable year in which the Exchange Conveyance Date occurs.
B.
Exchangor shall provide notice (the "ID Notice") to Exchange Intermediary in writing on or before
45 days after the Exchange Conveyance Date (the "ID Date") designating any Qualified Replacement Property that
Exchangor intends to acquire. Exchangor shall ensure that the ID Notice (i) is in the form required by Treasury
Regulation §1.1031(k)-1(c), (ii) specifically identifies the Qualified Replacement Property in the manner prescribed
in Treasury Regulation §1.1031(k)-1(c)(3), (iii) is signed by Exchangor, and (iv) is sent to Exchange Intermediary on
or before the ID Date.
C.
Exchange Intermediary agrees to use its reasonable efforts to acquire Qualified Replacement
Property identified to it in an ID Notice and transfer such Qualified Replacement Property to Exchangor pursuant to
the written instruction of Exchangor, the terms of the QRP Contract and this Agreement, subject in all respects to the
limitations of Sections 1.4(D) and (E) hereof. Exchangor shall enter into the QRP Contract with the seller and deliver
a copy thereof to Exchange Intermediary together with written instructions detailing the manner in which such
acquisition is to be closed. If the QRP Contract requires the payment of earnest money, Exchangor's written
instructions to Exchange Intermediary shall direct Exchange Intermediary to pay such funds out of the Exchange
Account Funds. In accordance with Treasury Regulation §1.1031(k)-1(g)(4), the exchange under Section 1031 of the
Code shall be effected as follows: (1) on or before the date that the Qualified Replacement Property is transferred (i)
Exchangor shall assign its rights in the QRP Contract to Exchange Intermediary, (ii) Exchangor shall notify in writing
all parties to the QRP Contract of the assignment of the QRP Contract, and (2) title to the Qualified Replacement
Property shall be transferred under the terms of the QRP Contract directly from the seller of the Qualified
Replacement Property to Exchangor. Exchangor acknowledges and agrees that Exchange Intermediary shall not, at
any time, hold title to the Qualified Replacement Property.
D.
In no event shall Exchange Intermediary be obligated to expend an aggregate amount to acquire
Qualified Replacement Property (included related expenses incurred) in excess of the Exchange Account Funds
unless Exchangor has provided such excess funds to Exchange Intermediary. In no event shall Exchange
Intermediary be required to assume any obligations under any QRP Contract.
E.
Exchange Intermediary shall not be obligated to enter into any agreement to acquire the Qualified
Replacement Property, assume any loan or other debt secured by the Qualified Replacement Property or otherwise
participate in any transaction which, in the opinion of legal counsel to Exchange Intermediary, would require
Exchange Intermediary to engage in any fraudulent or unlawful action or otherwise subject Exchange Intermediary to
potential liability.
F.
In the event of a default by a seller under a QRP Contract, Exchangor shall deliver written
instructions to Exchange Intermediary as to what remedies or options Exchange Intermediary is to exercise under the
QRP Contract, absent which instructions Exchange Intermediary shall have no duty to take any actions thereunder.
Exchange Intermediary shall be entitled to a cash deposit satisfactory to it for its potential costs and expenses in
following such written instructions of Exchangor and Exchangor agrees to reimburse Exchange Intermediary upon
demand therefor for all costs and expenses, including, without limitation, reasonable attorneys' fees, incurred by
Exchange Intermediary in complying with such written instructions; provided, however, that Exchange Intermediary
shall not be obligated to take any action which, in the opinion of legal counsel to Exchange Intermediary, could
subject Exchange Intermediary to potential liability.
1.5
Disbursement of Exchange Account Funds.
disbursement of Exchange Account Funds only as follows:
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Exchange Intermediary is hereby directed to make
A.
If Exchangor has acquired any Qualified Replacement Property or entered into a QRP Contract
requiring the payment of earnest money or a similar deposit, then upon written direction of Exchangor, Exchange
Intermediary shall disburse Exchange Account Funds in an amount sufficient to pay the purchase price or the earnest
money or similar deposit, as applicable, according to Exchangor's written instructions.
B.
If no ID Notice has been given by Exchangor to Exchange Intermediary on or before the ID Date,
then upon written direction of Exchangor, Exchange Intermediary shall disburse all remaining Exchange Account
Funds to Exchangor on the first day on which banks in Arizona are generally open for business (a "Business Day")
after the ID Date, subject, however, to the terms of this Agreement.
C.
If Exchangor has given one or more ID Notices to Exchange Intermediary on or before the ID Date
and has acquired all Qualified Replacement Property that is the subject of such ID Notices, then upon written
direction of Exchangor, Exchange Intermediary shall disburse all remaining Exchange Account Funds, if any, to
Exchangor on the first Business Day after the last of such Qualified Replacement Property was acquired, subject,
however, to the terms of this Agreement.
D.
If all Exchange Account Funds have not earlier been distributed as required under Sections 1.5(A),
(B), and (C) above, then upon written direction of Exchangor, Exchange Intermediary shall disburse all remaining
Exchange Account Funds to Exchangor on the first Business Day after the Replacement Date.
E.
Exchangor shall have no rights to the Exchange Account Funds prior to the dates set forth above
for the circumstances therein described, including, without limitation, the right to receive, pledge, borrow or
otherwise obtain any benefit from, such Exchange Account Funds.
1.6
Tax Matters.
A.
Exchangor represents and warrants that its taxpayer identification number set forth in the first
paragraph of this Agreement is true and correct and agrees to provide Exchange Intermediary with Form W-8, Form
W-9 or certification of foreign taxpayer exemption, as applicable, upon the execution of this Agreement. All
payments of income are subject to applicable withholding regulations under the Code. All interest and other earnings
on or a part of the Exchange Account Funds shall be taxable to Exchangor, and Exchangor acknowledges and agrees
that Exchange Intermediary will report to the Internal Revenue Service such interest and earnings as income of
Exchangor to the extent such interest and earnings are derived from the Exchange Account.
B.
Exchange Intermediary makes no representations or warranties regarding its qualifications as a
"qualified intermediary" under the Treasury Regulations or the adequacy of this Agreement under the Treasury
Regulations. Exchange Intermediary has not given any advice to Exchangor regarding the subject matter of this
Agreement, including, without limitation, any tax advice. Exchangor acknowledges that it independently has sought
the advice and judgment of, and has exclusively relied upon the advice and judgment of, its own tax advisor as to the
tax consequences of the transfers, conveyances and exchanges of the Exchange Property and the Qualified
Replacement Property under the Sales Contract, the QRP Contract, the Code, the Treasury Regulations and this
Agreement. Exchange Intermediary shall have no responsibility for locating or negotiating for the acquisition of any
Qualified Replacement Property, and shall not be liable if (i) a Qualified Replacement Property is not acquired by the
Replacement Date, (ii) the Exchange Account Funds are inadequate to acquire the Qualified Replacement Property,
or (iii) any Qualified Replacement Property fails to qualify as like-kind property under Section 1031 of the Code or
the transaction otherwise fails, for any reason, to afford Exchangor some or all of the benefits of Section 1031 of the
Code, unless the failure is caused solely by the gross negligence or willful misconduct of Exchange Intermediary.
C.
This Agreement is intended to comply with Section 1031 of the Code and the Treasury Regulations
to effect a like-kind exchange. If any provision of this Agreement is inconsistent with, not in compliance with, or
contrary to the purpose of Section 1031 of the Code and the Treasury Regulations, this Agreement shall be construed
and interpreted to the extent reasonably necessary to exclude or modify such provisions in order to satisfy the
purposes of this Agreement.
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ARTICLE II
PROVISIONS AS TO EXCHANGE INTERMEDIARY
2.1.
Limitation of Exchange Intermediary's Capacity.
A.
This Agreement expressly and exclusively sets forth the duties of Exchange Intermediary with
respect to any and all matters pertinent hereto, and no implied duties or obligations shall be read into this Agreement
against Exchange Intermediary. This Agreement constitutes the entire agreement between the Exchange
Intermediary and Exchangor in connection with the subject matter of this Agreement, and no other agreement entered
into between the parties, or among any buyer of Exchange Property, any seller of Qualified Replacement Property, or
any of them, shall be considered as adopted or binding, in whole or in part, upon the Exchange Intermediary
notwithstanding that any such other agreement may be referred to herein or deposited with Exchange Intermediary or
that the Exchange Intermediary may have knowledge thereof, and Exchange Intermediary's rights and responsibilities
shall be governed solely by this Agreement.
B.
Exchange Intermediary acts hereunder as an intermediary only, and is not responsible or liable in
any manner whatsoever for the sufficiency, correctness, genuineness or validity of the subject matter of this
Agreement or any part thereof, or for the form of execution thereof, or for the identity or authority of any person
executing or depositing such subject matter. Exchange Intermediary shall be under no duty to investigate or inquire
as to the validity or accuracy of any document, agreement, instruction or request furnished to it hereunder, including,
without limitation, the authority or the identity of any signer thereof, believed by it to be genuine, and Exchange
Intermediary may rely and act upon, and shall not be liable for acting or not acting upon, any such document,
agreement, instruction or request. Exchange Intermediary shall in no way be responsible for notifying, nor shall it be
its duty to notify, any party hereto or any other party interested in this Agreement of any payment required, maturity,
or deadline occurring under this Agreement or under the terms of any instrument deposited herewith.
2.2
Authority to Act.
A.
Exchange Intermediary is hereby authorized and directed by the undersigned to deliver the subject
matter of this Agreement only in accordance with the provisions of Article I of this Agreement. Exchange
Intermediary is acting hereunder only as Exchangor's agent and Exchange Intermediary shall have no liability as a
principal with respect to any of the transactions contemplated hereby. However, for tax purposes Exchange
Intermediary shall not be deemed to be Exchangor's agent, as provided in Section 1.1031(k)-1(g)(4)(i) of the Treasury
Regulations.
B.
Exchange Intermediary shall be protected in acting upon any written notice, request, waiver,
consent, certificate, receipt, authorization, power of attorney or other paper or document, including, without
limitation, the authority or the identity of any signer thereof, which Exchange Intermediary in good faith believes to
be genuine and what it purports to be, including, without limitation, items directing investment or non-investment of
funds, items requesting or authorizing release, disbursement or retainage of the subject matter of this Agreement and
items amending the terms of this Agreement.
C.
Exchange Intermediary may consult with legal counsel at the joint and several cost and expense of
Exchangor in the event of any dispute or question as to the construction of any of the provisions hereof or its duties
hereunder, and it shall incur no liability and shall be fully protected in acting in accordance with the advice of such
counsel.
D.
In the event of any disagreement between any of the parties to this Agreement, or between any of
them and any other person, resulting in adverse claims or demands being made in connection with the matters
covered by this Agreement, or in the event that Exchange Intermediary, in good faith, shall be in doubt as to what
action it should take hereunder, Exchange Intermediary may, at its option, refuse to comply with any claims or
demands on it, or refuse to take any other action hereunder, so long as such disagreement continues or such doubt
exists, and in any such event, Exchange Intermediary shall not be or become liable in any way or to any person for its
failure or refusal to act, and Exchange Intermediary shall be entitled to continue so to refrain from acting until (i) the
rights of all interested parties shall have been fully and finally adjudicated by a court of competent jurisdiction, or (ii)
all differences shall have been settled and all doubt resolved by agreement among all of the interested persons, and
Exchange Intermediary shall have been notified thereof in writing signed by all such persons. Notwithstanding the
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foregoing, Exchange Intermediary may in its discretion obey the order, judgment, decree or levy of any court,
whether with or without jurisdiction, or of any agency of the United States or any political subdivision thereof, or of
any agency of the State of Arizona or of any political subdivision thereof, and Exchange Intermediary is hereby
authorized in its sole discretion, to comply with and obey any such orders, judgments, decrees or levies. The rights of
Exchange Intermediary under this sub-paragraph are cumulative of all other rights which it may have by law or
otherwise.
E.
In the event that any controversy should arise among the parties with respect to this Agreement, or
should the Exchange Intermediary resign and the parties fail to select another Exchange Intermediary to act in its
stead, the Exchange Intermediary shall have the right to institute a bill of interpleader in any court of competent
jurisdiction to determine the rights of the parties.
2.3
Compensation/Indemnification.
A. Exchange Intermediary shall be entitled to reasonable compensation as well as reimbursement for its
reasonable costs and expenses incurred in connection with the performance by it of service under this Agreement
(including reasonable fees and expenses of Exchange Intermediary's legal counsel) and Exchangor agrees to pay
Exchange Intermediary reasonable compensation and to reimburse Exchange Intermediary for reasonable costs and
expenses. The parties hereto agree that fees shall be due and payable in the amount of $3,000.00. All such fees and
reasonable costs and expenses may be, from time to time in Exchange Intermediary's sole discretion, deducted from
the Exchange Account Funds.
B.
Exchangor agrees to indemnify and hold Exchange Intermediary, its affiliates and their officers,
employees, successors, assigns, attorneys and agents (each an "Indemnified Party") harmless from all losses, costs,
claims, demands, expenses, damages, penalties and attorney's fees suffered or incurred by any Indemnified Party as a
result of any action which it may take or refrain from taking in connection with this Agreement or any litigation or
cause of action arising from or in conjunction with this Agreement or involving the subject matter hereof or
Exchange Account Funds or monies deposited hereunder or for any interest upon any such monies, including,
without limitation, those arising out of the negligence of Exchange Intermediary; provided that the foregoing
indemnification shall not extend to the gross negligence or willful misconduct of Exchange Intermediary. This
indemnity shall include, but not be limited to, all costs incurred in conjunction with any interpleader which the
Exchange Intermediary may enter into regarding this Agreement.
2.4
Miscellaneous.
A.
Exchange Intermediary shall make no disbursement, investment or other use of funds until and
unless it has collected such funds. Exchange Intermediary shall not be liable for collection items until the proceeds of
the same in actual cash have been received or the Federal Reserve has given Exchange Intermediary credit for the
funds.
B.
Exchange Intermediary may resign at any time by giving written notice to Exchangor, whereupon
Exchangor will immediately appoint a successor intermediary. Until a successor intermediary has been named and
accepts its appointment or until another disposition of the subject matter of this Agreement has been agreed upon by
all parties hereto, Exchange Intermediary shall be discharged of all of its duties hereunder save to keep the subject
matter whole.
C.
All representations, covenants, and indemnifications contained in this Article II shall survive the
termination of this Agreement.
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ARTICLE III
GENERAL PROVISIONS
3.1
Appointment/Acceptance. Exchangor hereby appoints BOKF, NA DBA BANK OF ARIZONA as
Exchange Intermediary under this Agreement and BOKF, NA DBA BANK OF ARIZONA hereby agrees to act as Exchange
Intermediary under the terms of this Agreement.
3.2
Discharge of Exchange Intermediary. Upon the delivery of all of the subject matter or monies pursuant to
the terms of this Agreement, the duties of Exchange Intermediary shall terminate and Exchange Intermediary shall be
discharged from any further obligation hereunder.
3.3
Instructions. Exchangor may act hereunder through an agent or attorney-in-fact, provided satisfactory
written evidence of authority is first furnished to any party relying on such authority.
3.4
Notice. Any payment, notice, request for consent, report, or any other communication required or permitted
in this Agreement shall be in writing and shall be deemed to have been given when personally delivered to the party hereunder
specified or when placed in the United States mail, registered or certified, with return receipt requested, postage prepaid and
addressed as follows:
If to Exchange Intermediary:
BANK OF ARIZONA
Address
City, State Zip
Attn:
If to Exchangor:
_______________________________
_______________________________
_______________________________
Attn:__________________________
Any party may unilaterally designate a different address by giving notice of each such change in the manner specified
above to each other party. Notwithstanding the foregoing, no notice to the Exchange Intermediary shall be deemed given to or
received by the Exchange Intermediary unless actually delivered to an officer of the Exchange Intermediary having
responsibility under this Agreement.
3.5
Governing Law. This Agreement is being made in and is intended to be construed according to the laws of
the State of Arizona, without giving effect to the principles of conflict of laws. This Agreement shall inure to and be binding
upon the parties hereto and their respective successors, heirs and assigns; provided, however this Agreement may not be
assigned without the written consent of each party hereto.
3.6
Construction. Words used in the singular number may include the plural and the plural may include the
singular. The section headings appearing in this instrument have been inserted for convenience only and shall be given no
substantive meaning or significance whatsoever in construing the terms and conditions of this Agreement.
3.7
Amendment. The terms of this Agreement may be altered, amended, modified or revoked only by an
instrument in writing signed by the parties hereto.
3.8
Force Majeure. Exchange Intermediary shall not be liable to the undersigned for any loss or damage
arising out of any acts of God, strikes, equipment or transmission failure, war, terrorism, or any other act or circumstance
beyond the reasonable control of Exchange Intermediary.
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3.9
Written Agreement. This Agreement represents the final agreement between the parties, and may not be
contradicted by evidence of prior, contemporaneous or subsequent oral agreements of the parties. There are no unwritten oral
agreements between the parties.
3.10
Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed one
original, but all of which shall constitute one and the same instrument.
EXECUTED as of the date first set forth above.
EXCHANGOR:
By:
Name:
Title:
BOKF, NA DBA BANK OF ARIZONA, Exchange Intermediary, hereby accepts its appointment as Exchange
Intermediary as described in this Agreement, subject to the terms and conditions set forth therein.
BOKF, NA DBA BANK OF ARIZONA
By:
Name: ______________________________________________
Title:
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ACKNOWLEDGMENT OF RECEIPT
The undersigned hereby acknowledge receipt from and/or disbursement by BOKF, NA DBA BANK OF ARIZONA,
Exchange Intermediary under the foregoing Agreement, of the subject matter of the Agreement as described in such
Agreement; the undersigned acknowledge a faithful and proper performance by the Exchange Intermediary of its duties under
the Agreement, and in consideration of such disbursement hereby release and discharge the Exchange Intermediary from all
further responsibility or liability as Exchange Intermediary under the Agreement.
Executed this
day of
, 20 .
EXCHANGOR:
By:
Name:
Title:
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EXHIBIT A
Exchange Property
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