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Business — Comments Off on Lease Agreement Template for Equipment, Vehicle and Rental
15
Aug 21

Lease Agreement Template for Equipment, Vehicle and Rental

This Equipment Lease (“Lease”) is made effective as of ____________ (Date), by and between _________________ (“Lessor”) and _____________________ (“Lessee”). The agreement of the parties is as follows:

1. Equipment subject to Lease.  Lessor shall lease the Equipment (“Equipment”) listed in Exhibit 1.

2. Payment Terms.  The Lessee shall make ___ payments of $________, for a total amount of $________. Payments shall be due on the first day of each month, with the first payment due on __________________. The lease payments shall be due without further notice to Lessee of any payment being due.  

3. Late Charge.   A late charge of 5% of the payment shall be due if any Lease payment is not received within 10 days of the due date.  In addition, interest will be charged at the rate of 1.5% per month, or 18% per year, on any unpaid balances.  

4. Insufficient Check Charge.  Lessee shall be charged $25 for each check that is returned to the Lessor for lack of sufficient or collectable funds or any other reason whatsoever.

5. Security Deposit.  Lessee shall pay a security deposit of two payments or $ _______, at the time this Lease is signed.  This deposit will be returned to the Lessee at the termination of this Lease, subject to the option of the Lessor applying it against Lease charges and damages.  Any amounts refundable to the Lessee shall be paid at the time this Lease is terminated.  The security deposit shall bear interest at an annual rate of 6% from the date paid to the Lessor until the date refunded, based on the total amount of the security deposit.

6. Lease Term.  This Lease shall begin on the above effective date and shall terminate on ______________ (Date) unless otherwise terminated in a manner consistent with the terms of this Lease.

7. Location or locations of the Equipment.  The equipment shall be located at _______________________________ during the lease term, and shall not be removed from that location without the Lessor’s prior written consent.

8. Operation and Care of Equipment.  The equipment must be used and operated carefully and appropriately.  Its use must comply with all laws, ordinances, and regulations relating to the possession, use, or maintenance of the equipment, including registration and/or licensing requirements if any.

9. Maintenance and Repair.  Lessee shall maintain at the Lessee’s cost, the equipment in good repair and operating condition, allowing for reasonable wear and tear.  Such costs shall include labour, material, parts, and any similar items.

10. Alternations.  Lessee shall make no alterations to the equipment without the prior written consent of Lessor.  All alterations shall be the property of Lessor and subject to the terms of this Lease. 

11. Right of Inspection. Lessor shall have the absolute right to inspect the Equipment during Lessee’s normal business hours.

12. Equipment Return at the end of the Lease.  At the end of the lease term, the Lessee shall be obligated to return the equipment to the Lessor at the Lessee’s expense.

13. Renewal Option of the Lessee.  If Lessee is not in default upon the expiration of this Lease, the Lessee shall have the option to renew this Lease for a similar term on such terms as the parties may mutually agree upon at the time of such renewal, the end of the Lease period covered in this Agreement.

14. Purchase Option.  If Lessee is not in default under this Lease, the Lessee shall have the option to purchase items of equipment at the end of the lease term for the price specified for such items of equipment in the attached Exhibit 1.  Lessee shall exercise this option by providing written notice to the Lessor of such intent at least 30 days prior to the end of the lease term.

15. Equipment Acceptance by Lessee.  Lessee shall inspect each item of equipment delivered pursuant to this Lease.  The Lessee shall immediately notify the Lessor of any discrepancies between such item of equipment and the description of the equipment in the Equipment Schedule.  If the Lessee fails to provide such notice before accepting delivery of the equipment, the Lessee will be conclusively presumed to have accepted the equipment as specified in Exhibit 1.

16. Ownership and Legal Status of Equipment.  Equipment will be deemed to be personal property, regardless of the manner in which it may be attached to any other property.  Lessor shall be deemed to have retained title to the equipment at all times unless the Lessor transfers the title by sale.  The Lessee shall immediately advise the Lessor regarding any notice of any claim, levy, lien, or legal process filed or issued against the equipment.

17. No Warranty.  Lessor makes no warranties, express or implied, as to the equipment leased. Lessee assumes responsibility for the condition of the equipment.

18. Risk of Loss or Damage and Insurance.  Lessee assumes all risk of loss or damage to the equipment from any cause and agrees to return it to the Lessor in the condition received from the Lessor, with the exception of normal wear and tear, unless otherwise provided in this Lease.  Lessee shall provide evidence of insurance of the equipment and make Lessor a Named party on the insurance policy.  Any lapse of insurance shall be considered a default under the terms of this Agreement.

19. Indemnity of Lessor for Loss or Damages.  Unless otherwise provided in this Lease, if the equipment is damaged or lost, Lessor shall have the option of requiring the Lessee to repair the equipment to a state of good working order or replace equipment with like equipment in good repair, which equipment shall become the property of the Lessor and subject to this Lease.

20. Liability and Indemnity.  Liability for injury, disability, and death of workers and other persons caused by operating, handling, or transporting the equipment during the term of this Lease is the obligation of Lessee, and Lessee shall indemnify and hold Lessor harmless from and against all such liability.  Lessee shall maintain liability insurance of at least $1 million as further discussed in Section 18 above, entitled “Risk of Loss or Damage and Insurance.

21. Taxes and Fees.  During the term of this Lease, the Lessee shall pay all applicable taxes, assessments, and license and registration fees on the equipment.

22. Default.  The occurrence of any of the following shall constitute a default under this Lease:

  1. Failure to make a required payment under this Lease when due.
  • Violation of any other provision or requirement that is not corrected within 10 days after written notice of the violation is given.

       C.    The insolvency or bankruptcy of Lessee.

  •    The subjection of any of Lessee’s property to any levy, seizure, assignment, application or sale for or by any creditor or government agency.

23. Rights upon Default.  In addition to any other rights afforded the Lessor by law, if the Lessee is in default under this Lease, without notice to or demand on the Lessee, the Lessor may take possession of the equipment as provided by law, deduct the costs of recovery (including attorney fees and legal costs), repair, and related costs, and hold the Lessee responsible for any deficiency.  The rights and remedies of the Lessor provided by law and this Agreement shall be cumulative.  Lessor shall be obligated to release the equipment, or otherwise mitigate the damages from the default, only as required by law.

Exhibit 1:  Equipment Schedule

Lease-End Purchase Price:     (Should be included; very important).

Equipment Lease – Review List

This review list is provided to inform you about the document in question and assist you in its preparation.  This is a standard straightforward lease agreement.  Be sure to file the appropriate local, county, and state liens (UCC forms) against the equipment within the locals where the Equipment is kept by Lessee, according to this Agreement.  This not only perfects your interest in the property but also warns off other creditors of Lessee, so they do not attempt to attach the property.  If they do, you will have a senior position.

Be sure to establish an end of the lease-purchase price in Exhibit 1.  Do likewise for a renewal period of the Equipment.  GE Capital, for example, has found releasing Equipment very lucrative because the proper paperwork is in place and continuation is quite simple because, by the end of the first lease period, most equipment is worth more than its then supposed capital price.  Therefore, you may be well advised from a business perspective to encourage releasing for a reduced price at the end of the lease.  In this instance, inertia is on your side since Lessee “has” the Equipment and it is always easier to continue as is rather than getting new equipment, and so on.

  1. Make multiple copies so you have several sets for your various files, including your corporate records. 

2.  Be sure to file liens, as appropriate, as described above against your equipment in the appropriate jurisdictions.

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Business — Comments Off on Agreement for Assignment & Transfer of Lease
15
Aug 21

Agreement for Assignment & Transfer of Lease

This Assignment of Equipment Lease (“Assignment”) is made as of  _______________ (Date) by and between ___________________________ Original Lessee (“Assignor”) of _______________________________ (Address) and ___________________________ New Lessee (“Assignee”) of _______________________________________________.

Whereas by a lease dated _________ made between ____________________, the original Lessor (the “Lessor”) and the Assignor (the “Lease”), the Lessor leased to the Assignor ___________________________________________ (“Equipment”), subject to the covenants and agreements contained in the Lease, a copy of which is attached hereto as Exhibit 1; and the Assignor wishes to assign to the Assignee, and the Assignee wishes to be assigned, the Lease;

Therefore in consideration of the mutual covenants and agreements contained herein and for other good and valuable consideration (the receipt and sufficiency of which is hereby acknowledged) the parties hereby agree as follows:

1.       The Assignor hereby assigns to the Assignee its interest in the Equipment and the Lease and all benefit and advantage to be derived therefrom.

2.       The Assignee covenants and agrees to pay the monthly lease payments and observe and perform all of the lessee’s covenants and obligations contained in the Lease.

3.       The Assignee agrees to be bound by all the terms, covenants, conditions and obligations in the Lease as if the Assignee had entered into the Lease with the Lessor and as if the Assignee were the original lessee under the Lease.

4.    The Assignee agrees to obtain consent from the Lessor, whereby the Lessor consents to the assignment of the Lease to the Assignee.

5.       The Assignee indemnifies and holds harmless the Assignor from and against any and all costs, expenses, damages and losses which the Assignor may suffer or incur relating to the Equipment and the Lease from and after the date hereof, including but not limited to any costs, expenses, damages and losses which arise as a result of the failure of the Assignee to comply with the terms of this paragraph.

6.       This Assignment shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, executors, administrators, successors and assigns.

7. Notices.

Any notice required by this Agreement or given in connection with it, shall be in writing and shall be given to the appropriate party by personal delivery or a recognized over night delivery service such as FedEx.

If to the Assignor: _____________________________________________________.

If to the Assignee: _____________________________________________________.

If to the Lessor: _______________________________________________________.

8.  No Waiver.

The waiver or failure of either party to exercise in any respect any right provided in this agreement shall not be deemed a waiver of any other right or remedy to which the party may be entitled.

9.  Entirety of Agreement.

The terms and conditions set forth herein constitute the entire agreement between the parties and supersede any communications or previous agreements with respect to the subject matter of this Agreement.  There are no written or oral understandings directly or indirectly related to this Agreement that are not set forth herein.  No change can be made to this Agreement other than in writing and signed by both parties.

10.  Governing Law.

This Agreement shall be construed and enforced according to the laws of the State of ____________________ and any dispute under this Agreement must be brought in this venue and no other.

11.  Headings in this Agreement

The headings in this Agreement are for convenience only, confirm no rights or obligations in either party, and do not alter any terms of this Agreement.

12.  Severability.

If any term of this Agreement is held by a court of competent jurisdiction to be invalid or unenforceable, then this Agreement, including all of the remaining terms, will remain in full force and effect as if such invalid or unenforceable term had never been included.

In Witness whereof, the parties have executed this Agreement as of the date first written above.

_________________________                                              _______________________

Assignor                                                                                  Assignor

___________________                                                          _______________________

Date                                                                                        Lessor

Exhibit 1:  Original Lease


Agreement for Assignment & Transfer of Lease – Review List

This review list is provided to inform you about this document in question and assist you in its preparation.  This is a straightforward Assignment Agreement, which may be modified for other assignments.

  1. Make multiple copies so all parties may have one original copy.  Include a copy in your minute book, make it available to any financial institution that requires you to provide copies of capital equipment obligations, and keep a separate copy in the equipment lease or vendor file.
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Business — Comments Off on Sample letter for Cancellation of Agreement, Contract, Lease, Rental
14
Aug 21

Sample letter for Cancellation of Agreement, Contract, Lease, Rental

Sample letter for cancellation of agreement, contract, lease, rental, estate or any other type. Explain the reasons for the breach and demand the damages.

Dear ________________:

You are hereby officially notified and put on notice that our contract dated ___________, termed the __________________ Agreement is cancelled for cause as a result of your breaches, as described in the Agreement itself.

Among the breaches are the following:  

You are further notified and put on notice as required by UCC regulations that any obligation to make further performance under the Agreement is terminated, and that the right to proceed against you because of your breach of the Agreement is not waived.

You are further notified that as a result of your breach of the Agreement, we have suffered damages in the amount of  $ __________________, computed as follows:

We expect you will make good on these damages and will expect to receive them within the next 30 days.  If this is not possible, please contact us to set up a payment schedule so we can avoid legal expenses on both sides.

Yours very truly,

_______________

Authorized Employee

Cancellation of Agreement, Contract, Lease, Rental – Review List

This review list is provided to inform you about the document in question and assist you in its preparation.

  1. Prepare this letter and send it, along with the underlying contract, to your lawyer. Rarely does an agreement cancellation go uncontested.  Since litigation takes an extended period of time, unless settled along the way, it is very expensive to act in haste and repent at leisure, as the old cliché goes.  This letter is generally used as the initial tactic to get out of an agreement.  You need to consult your lawyer, and a litigation lawyer if suggested by your lawyer, about the best way to proceed. 
  • A buyer’s right to cancel an agreement is determined by the contract itself and the law in general.  The governing law in most states is the Uniform Commercial Code (UCC).  Make sure that you are legally entitled to cancel the contract before sending this notice.  You need to consult a lawyer to get proper answers to this question.  In many cases, as one would expect, the answers are ambiguous.  In those cases, you must weigh the business and legal ramifications of your decision; consulting with your attorney on this is usually a vital component of a satisfactory conclusion.
  • In summary, these kinds of letters tend to be tactical approaches to resolve a business situation.  As a rule, no solution is satisfactory to both parties.  You must try to seek out a solution that is the least painful and most acceptable to the parties.  As we often say in our Negotiations Handbook CD, “It was a perfect compromise; both parties were equally unhappy with the result.”
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