Common use of Internal Revenue Code Section 1031 Exchange Clause in Contracts

Internal Revenue Code Section 1031 Exchange. Buyer or Seller may structure the purchase of the Property as a tax deferred exchange of like-kind property within the meaning of Section 1031 of the Internal Revenue Code (an “Exchange”). The parties agree to cooperate reasonably to effect the Exchange; provided, however, that: (a) the non-exchanging party shall not be required to contract for, acquire or take title to any exchange property; (b) the non-exchanging party shall not be required to incur any expense or liability in connection with the Exchange, including, without limitation, any obligation for the payment of any escrow, title, intermediary, exchange, brokerage or attorneys’ fees or other costs incurred with respect to the Exchange or payable directly as a result of the Exchange; (c) no substitution of any qualified intermediary for a party shall release that party from its obligations set forth in the Agreement; (d) the exchanging party shall identify to the non-exchanging party and to the closing agent and the Title Company for the sale and purchase under the Agreement, prior to Closing the identity of the exchangor or qualified intermediary effecting and participating in the Exchange and all information necessary to effect the Exchange; (e) the exchanging party shall be responsible for the preparation of any and all agreements, documents and escrow instructions (collectively, “Exchange Documents”) required for the Exchange, at its sole cost and expense; (f) the exchanging party shall be responsible for making all determinations as to the legal sufficiency, tax considerations and any other considerations relating to the proposed Exchange, the Exchange Documents and the transactions contemplated thereby; and (g) the non-exchanging party shall in no event be responsible for, or be deemed to make any representations as to the tax or other consequences of the exchange transaction arising by reason of its cooperation and performance of the Exchange or its execution of any Exchange Documents.