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This Personal Property Co-Ownership Agreement sets forth the terms and conditions of an agreement between two parties who co-own certain personal property. The document provides the respective ownership interest of each party, as well as the respective ongoing rights and obligations of each party with respect to the property. This document contains numerous standard clauses that are commonly included in these types of agreements, and is fully customizable to ensure the agreement between the parties is accurately memorialized. Individuals who co-own personal property or want to enter into an agreement to co-own personal property should use this document.
This Personal Property Co-Ownership Agreement sets forth the terms and conditions of an agreement between two parties who co-own certain personal property. The document provides the respective ownership interest of each party, as well as the respective ongoing rights and obligations of each party with respect to the property. This document contains numerous standard clauses that are commonly included in these types of agreements, and is fully customizable to ensure the agreement between the parties is accurately memorialized. Individuals who co-own personal property or want to enter into an agreement to co-own personal property should use this document. Personal Property Co-Ownership Agreement This agreement is executed this _____day of _____, ______ [Instruction: Insert agreement date.] by and between: _____ [Instruction: Insert first party’s name.] (“First Party”) and ______ [Instruction: Insert second party’s name.] (“Second Party”). First Party and Second Party have purchased certain personal property known as _____ [Instruction: Insert brief description of the jointly owned property. If a more comprehensive listing is required, attach same as a schedule to the agreement, and state that same is attached and incorporated as if fully set forth herein.], herein referred to as the Property. The parties hereto acknowledge that they own the Property as ______ [Instruction: Insert how property is titled, if titled. Otherwise, state how parties intend ownership to be held.] and that First Party has _____ [Instruction: Insert First Party’s respective ownership percentage.] percentage beneficial ownership interest and Second Party has ______ [Instruction: Insert Second Party’s respective ownership percentage.] percentage beneficial ownership interest in the Property. For good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and in consideration of the mutual covenants and conditions herein contained, the parties hereto agree as follows: 1. The Property was purchased on _____ [Instruction: Insert Property purchase date.] for a price of $_____ [Instruction: Insert Property purchase price.]. The parties have each made an equal capital investment [Comment: If each party made different capital investments, please list here.] towards the purchase of the Property. [Comment: If any outstanding debt is attributable to Property, state here amount of debt, and how each party is obligated to pay such debt.] 2. The parties hereto deem it in their best interests to define their obligations to each other with respect to the ownership, maintenance and sale of the Property, and to provide for a mechanism to allow for the sale of either party’s interest. 3. It is the intention of the parties is that First Party and Second Party shall have use of the Property as follows: _____. [Instruction: State how parties shall divide usage of the Property, and if either shall have to pay any fee to the other for such usage. Further, the parties may wish to define the permitted usage of the Property, including whether or not same must or may exclusively be used for business or recreational uses, and whether or not the Property may be lent (without any rental being paid) to any other person or entity by either party.] 4. Optional language: The parties expressly state that they do not intend to create a partnership whereby any co-owner shall be liable for the act of any other co-owner, to the extent permitted by applicable law. 5. The parties hereto agree they shall bear the costs of the Property in proportion to their ownership interests in the Property. For purposes of this agreement, “carrying costs” shall be deemed to include but not limited to payments of both principle and interest on the Property for which both parties are indebted, tax payments, insurance (if applicable), repairs, maintenance and capital improvements. [Instruction: Insert any additional specific carrying costs which may be applicable.] The parties further agree that any special assessments which may be assessed as a carrying cost of the Property shall be borne by the parties in proportion to their ownership interests in the Property. © Copyright 2012 Docstoc Inc. 2 [Comment: Parties may wish to provide a mechanism for loss of use of the Property in the event a party does not pay his respective carrying charges, assessments or other amounts owed pursuant to the agreement.] 6. All documents pertaining to the ownership of the Property shall be maintained by ______ [Instruction: Insert name of party responsible for ownership documents.]. 7. The Property shall be kept and generally maintained in generally good condition. Any repair or capital improvement or item of maintenance to the Property costing more than $100.00 shall require the approval of all parties but such approval shall not be unreasonably withheld and shall be given to conform to the standards of the paragraph, and the costs and expenses of such repair or capital improvement or item of maintenance shall be divided among the parties as set forth in this agreement. Notwithstanding the foregoing, in the event any such repair or capital improvement or item of maintenance to the Property shall be required by any governmental authority or other authority with jurisdiction over the Property shall not require any such approval of either party. 8. The parties agree that they shall not rent the Property. In the event the parties shall agree in the future to rent the Property, any such rental shall be made to persons or entities who shall be approved by both parties or by their duly appointed agent or management company at an agreed upon fair market value. Any collected rents shall be used to directly reduce the carrying costs of the Property. Any positive cash flow shall be distributed to the parties in proportion to their ownership interest, unless otherwise agreed in a writing signed by both parties. In the event of any such rental, each party shall be responsible to file any necessary forms and pay any taxes applicable to any such income collected based upon their percentage interest, unless otherwise agreed in a writing signed by both parties or as otherwise required by applicable law. 9. The parties agree to pay the Property carrying costs as stated in this agreement as and when same shall become due and payable. [Comment: If parties are going to set up an account from which to pay for such carrying costs, detail the method and manner in which same shall be set up, including how often same must be funded, and whether or not both parties shall have signatory access on the account.]. The parties further agree that ____ [Instruction: Insert name of responsible party.] shall be responsible for ensuring all payments for any such carrying costs are paid as and when same shall become due and payable. 10. In the event that either party should wish to sell his or her interest in the Property, he shall first offer to sell his or her interest to the other party(s) hereto by a written notice stating the proposed terms of sale. The other party(s) shall within thirty (30) days of the notice of offer to sell elect either (I) to accept the offer and purchase the offering party’s interest on the terms offered, or (II) consent to the proposed sale to a third party upon terms offered, or (III) agree to list the Property for sale on the market. Any closing between parties arising from a sale or transfer under this paragraph shall occur within a reasonable time agreed upon by all parties. In the event that only an interest in the Property is sold, the willing seller shall be responsible for all seller fees and shall be solely responsible for his payment of any liens or encumbrances arising out of his or her separate obligations and shall deliver good, clear, record and marketable title except for joint encumbrances and matters known to the parties on the date of acquisition of the Property. In the event a withdrawing co-owner is behind in the payment of any monthly contributions for carrying costs or special assessments, these arrearages shall be deducted © Copyright 2012 Docstoc Inc. 3 from the amounts paid above. In the event that the Property is sold by all parties, the costs incurred by selling (i.e. payment of mortgage, broker’s commission, escrow, title, etc.) will be deducted from the purchase price, and the net amount will then be divided between the parties upon their percentage interest, unless otherwise agreed in a writing signed by both parties. In the event any co-owner is behind in the payment of any monthly contributions for carrying costs or special assessments, these arrearages shall be deducted from the amounts paid above. 11. Either party shall be permitted to transfer his ownership interest hereunder by will or intestacy without restriction, except that any such transferee shall be bound by the terms of this agreement. The costs associated with any such transfer shall be payable by the transferee. 12. For any disputes arising under this agreement, parties agree to first resolve the dispute under mediation and then arbitration in the county of _____ [Instruction: Insert arbitration county.]. In the event of any dispute hereunder, the party prevailing in such mediation or arbitration shall be entitled to recover, in addition to any and all other remedies and damages, and reasonable attorneys’ fees incurred in such action. 13. Any notices sent or required to be sent pursuant to this Agreement shall be in writing and be deemed to be duly served if mailed, postage prepaid, certified mail, return receipt requested, or delivered by Federal Express or other comparable overnight carrier, or delivered in hand by a duly appointed constable, to the addresses of the parties stated below or to such other addresses as either party may notify the other by notice given pursuant to this paragraph: ______ [Instruction: Insert First Party and Second Party’s respective addresses.]. 14. This agreement shall be construed, interpreted and enforced in accordance with the laws of the State of _____ [Instruction: Insert state.]. 15. This agreement constitutes the entire agreement of the parties with respect to its subject matter, and may not be changed orally, but only by an agreement in writing signed by the party against whom the enforcement of any waiver, change, modification, extension or discharge is sought. 16. The waiver by one party of a breach of any provision of this Agreement by the other party shall not operate or be construed as a waiver of any previous or subsequent breach of the same or any other provision by the other party. 17. In the event that any portion of this agreement shall be deemed null and void or unenforceable by any court of competent jurisdiction, then notwithstanding the same, the remaining provisions of this agreement shall be full force and effect. 18. This agreement or any subsequent amendment or modification hereto may be executed by facsimile and/or in one or more counterparts, each of which when so executed and delivered shall be deemed an original, but all of which taken together shall constitute but one and the same original. Each party shall accept any such signed faxed counterpart as full execution of this agreement or any subsequent amendment or modification thereto. 19. The pronouns used herein shall include, where appropriate, either gender or both, singular and plural. IN WITNESS WHEREOF, the undersigned have executed this agreement under seals of the date and year first written above. © Copyright 2012 Docstoc Inc. 4 ___________________________ First Party Signature Block ___________________________ Second Party Signature Block © Copyright 2012 Docstoc Inc. 5
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