"Upgrade" sounds a lot different from "selling" and "purchase." If you just put in more money and get an upgraded or enhanced contract, you didn't sell anything. The original question said "selling . . . and using the funds to purchase." That sure sounds like a sale, especially if any money actually passes through your hands, even momentarily. If at any point there are "proceeds," and you have discretion about what to do with the proceeds, it looks very much like a sale. I guess you have to pin down the exact nature of the transaction. And as Critter-3 said earlier, you have to pin down whether or how it will be reported to the IRS. I still recommend consulting with a lawyer.
