Vehicle Lease Agreement - Template, Sample Form Online Pro · US-law

VEHICLE LEASE AGREEMENT

State of ________

BACKGROUND:

This Vehicle Lease Agreement (the "Agreement") is entered into and made effective as of ________ (the "Effective Date"), by and between the Lessor, ________ (the "Lessor"), of the following address:

________

and the Lessee, ________ (the "Lessee"), of the following address:

________

Lessor and Lessee may be referred to individually as a "Party" and collectively as the "Parties." The Parties agree as follows:

§ I. RECITALS.

WHEREAS, the Lessor is the registered owner of the vehicle described herein (the "Vehicle");

WHEREAS, the Lessor wishes to lease the Vehicle to the Lessee on the terms set out in this Agreement, and the Lessee wishes to lease the Vehicle from the Lessor on said terms;

WHEREAS, this Agreement is a lease only, and the Lessee shall have no right, title, or interest in or to the Vehicle except for the use of the Vehicle as described herein;

WHEREAS, this Agreement shall be treated as a true lease for federal and applicable state income tax purposes, with Lessor having all benefits and burdens of ownership of the Vehicle;

WHEREAS, the Parties intend this Agreement to comply with the federal Consumer Leasing Act, 15 U.S.C. § 1667 et seq., and Regulation M, 12 C.F.R. Part 1013, to the extent applicable, and with Article 2A of the Uniform Commercial Code as enacted in the governing state;

NOW, THEREFORE, in consideration of the mutual covenants set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, IT IS HEREBY AGREED as follows:

§ II. LEASED VEHICLE DESCRIPTION.

1. The following vehicle (the "Vehicle") is the subject of this Agreement:

Vehicle Condition: ________

Make: ________

Model: ________

Year: ________

Body Type: ________

Color: ________

Odometer Reading: ________ miles

License Plate: ________

Vehicle Identification Number (VIN): ________

Vehicle's Intended Purpose: ________

§ III. AMOUNT DUE AT LEASE SIGNING.

2. Lessor and Lessee agree on the following amounts due at lease signing:

(a) A refundable security deposit in the amount of $________;

(b) A down payment (capitalized cost reduction) in the amount of $________;

(c) Applicable title, license, and registration fees in the amount of $________;

(d) GAP coverage, if elected, for a fee of $________;

(e) First periodic lease payment in the amount of $________.

TOTAL AMOUNT DUE AT LEASE SIGNING: $________

§ IV. TRADE-IN ALLOWANCE, DISCOUNTS, AND REBATES.

3. Lessee will be allowed a net trade-in allowance of $________.

4. Lessor is offering the following amount in discounts, rebates, and/or incentives: $________.

§ V. LEASE COSTS AND FEES.

5. The Lessor and Lessee agree to the following terms regarding the total cost of the Lease, excluding any costs for repairing excess wear and tear of the Vehicle:

(a) The full retail cost of the Vehicle is $________.

(b) The Lessor and Lessee have negotiated and agree that the gross capitalized cost (agreed value) of the Vehicle is $________.

(c) A good faith estimate of the residual value of the Vehicle at the end of the Term is $________.

(d) The net capitalized cost (gross capitalized cost minus any net trade-in allowance, down payment, rebate, non-cash credit, or cash paid) is $________.

(e) The depreciation and any amortized amounts (net capitalized cost minus residual value) is $________.

(f) The term of the Lease is the following number of months: ________ (the "Term").

(g) The total base monthly depreciated payment is $________.

(h) The rent charge (lease finance charge) over the Term is $________.

§ VI. LEASE PAYMENTS.

6. Lessee shall pay to Lessor periodic installments of $________ per ________.

7. Lease payments shall be payable in advance on ________ of each payment period.

8. Payments may be made in the following acceptable manner(s):

________

9. Payments are to be made to the Lessor at the address listed above. The payment address may be changed at the discretion of the Lessor, and the Lessee shall be informed of such change by written notice.

§ VII. SECURITY DEPOSIT.

10. The Lessee shall pay a security deposit of $________ at the time this Lease is signed. This deposit, less any amounts lawfully applied against unpaid Lease charges and damages, shall be returned to the Lessee within the period required by applicable law following termination of the Lease and return of the Vehicle.

§ VIII. LATE PAYMENT FEES.

11. A late fee of ________% of the overdue payment, or such lesser amount as may be permitted by applicable law, will be charged on any payment not received within ________ days after the due date.

§ IX. MILEAGE LIMIT.

12. Lessee will be permitted to drive the Vehicle for a maximum of ________ miles per year and will be charged $________ per excess mile if the Vehicle is driven beyond the allotted number of miles.

§ X. GAP PROTECTION NOTICE.

13. In the event of theft of or damage to the Vehicle that results in a total loss, there may be a gap between the amount due upon early termination and the proceeds of any insurance settlement together with any applicable deductible.

14. This Lease provides that Lessor will offer GAP coverage to Lessee, if elected, for a fee of $________.

§ XI. INSURANCE.

15. Lessee shall, at its own expense, obtain and maintain throughout the Term comprehensive automobile liability insurance, collision coverage, and property damage insurance covering the Vehicle in amounts not less than those required by applicable law and acceptable to Lessor. Lessor shall be named as an additional insured and loss payee on all such policies.

16. Lessee shall provide Lessor with proof of such insurance prior to taking possession of the Vehicle and upon request thereafter, and shall not allow such coverage to lapse at any time during the Term.

17. In the event of any loss, theft, or damage to the Vehicle, Lessee shall promptly notify Lessor and the applicable insurer and shall cooperate fully in the processing and settlement of any claim.

§ XII. USE OF VEHICLE.

18. Lessee shall use the Vehicle solely for its intended purpose as set forth in this Agreement and in a careful and lawful manner. Lessee shall comply with all laws, ordinances, and regulations relating to the use, operation, and possession of the Vehicle, and shall not use or permit the Vehicle to be used for any illegal purpose or in any manner that would void any applicable warranty or insurance coverage.

§ XIII. END OF TERM LIABILITY.

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(a) Excessive use or damage representing more than normal wear and use results in an unusually low value at the end of the Term;

(b) The matter is not otherwise resolved and Lessor prevails in a lawsuit against Lessee seeking a higher payment; or

(c) Lessee voluntarily agrees with Lessor, after the end of the Term, to make a higher payment.

20. Should the Lessor bring a lawsuit against the Lessee, the Lessor must prove that the original estimate of the value of the leased Vehicle at the end of the Term was reasonable and was made in good faith. Lessor shall also pay Lessee's reasonable attorney's fees in connection with such action to the extent required by applicable law.

21. If Lessee disagrees with the value assigned to the Vehicle, Lessee may obtain, at Lessee's own expense, from an independent third party agreeable to both Parties, a professional appraisal of the value of the leased Vehicle that could be realized at sale. The appraised value shall then be used as the actual value, and shall be final and binding on the Parties.

§ XIV. EARLY TERMINATION DISCLOSURE.

22. Lessee may have to pay a substantial charge if this Lease is ended early. The charge may be up to several thousand dollars. The actual charge will depend on when the Lease is terminated. The earlier the Lease is ended, the greater this charge is likely to be.

23. Lessor may unilaterally terminate this Lease early if it is discovered that the Vehicle is being used for anything other than its agreed-upon purpose.

§ XV. EXCESSIVE WEAR AND USE.

24. Lessee may be charged for excessive wear based on Lessor's specifications and generally accepted standards for normal use. Excessive wear and use includes, but is not limited to: damaged glass, damaged body panels, lights, fenders, paint, dysfunctional accessories, extremely worn tire tread, any damage to the interior, and any mechanical damage that interferes with the safe and lawful operation of the Vehicle.

§ XVI. PURCHASE OPTION AT END OF LEASE TERM.

25. Lessee shall have the option to purchase the Vehicle at the end of the Term for $________, plus applicable taxes, fees, and any amounts then due under this Lease, on an "AS IS, WHERE IS" basis without warranty of any kind.

§ XVII. NOTICES.

26. All notices required or permitted under this Lease shall be deemed delivered when delivered in person, by nationally recognized overnight courier, or by certified mail, return receipt requested, postage prepaid, addressed to the appropriate Party at the address shown for that Party at the beginning of this Lease.

§ XVIII. ASSIGNMENT.

27. The Lessee shall not assign, transfer, or sublet any of its obligations, rights, or interests under this Agreement to any third party, whether an associated entity or not, in whole or in part, without the prior written consent of the Lessor. Lessor may assign its rights under this Agreement without Lessee's consent.

§ XIX. TERMINATION.

28. If Lessee fails to pay any amount due under this Agreement or to comply with any of the covenants contained in this Agreement, Lessor may terminate this Agreement upon thirty (30) days' written notice (or such shorter period as may be permitted by applicable law) and exercise any remedies available under applicable law, including Article 2A of the Uniform Commercial Code.

§ XX. EVENT OF DEFAULT.

29. The Lessee will be in default if the Lessee fails to make a payment on its prescribed due date, has misrepresented personal or financial information, allows the Vehicle to be damaged beyond repair, fails to return the Vehicle at the end of the Term, fails to maintain Vehicle insurance as required, or breaches any other term of this Lease.

§ XXI. RETURN OF VEHICLE.

30. At the end of the Lease, the Vehicle shall be returned to the care of Lessor at the location designated by Lessor. Lessee shall pay any applicable end-of-lease costs, including excess mileage and excessive wear charges.

§ XXII. COSTS, EXPENSES, FEES, AND CHARGES.

31. Lessee agrees to pay all fines, tickets, tolls, or penalties incurred in connection with the operation of the Vehicle during the Term.

§ XXIII. MAINTENANCE.

32. Lessee agrees, at its expense, to maintain the Vehicle in good condition, repair, and running order, and in accordance with all manufacturer and warranty requirements. Lessee shall be responsible for all expenses arising from the normal wear and use of the Vehicle.

33. Lessee agrees to comply with Lessor's maintenance requirements, including, but not limited to, tire rotation and replacement, replacement of the air filter, replacement of hoses, clamps, belts, and spark plugs, and oil changes.

§ XXIV. SEVERABILITY.

34. If a court holds any provision of this Agreement to be illegal, invalid, or unenforceable, the remaining provisions shall remain in full force and effect, and the Parties will amend this Agreement to give effect to the stricken clause to the maximum extent permitted by law.

§ XXV. RISK OF LOSS.

35. Lessee assumes and agrees to bear the entire risk of loss, theft, damage to, or destruction of the Vehicle from any cause whatsoever. In the event of any such occurrence, Lessee shall give Lessor prompt notice and thereafter place the Vehicle in good repair, condition, and working order, subject to the rights of the insurer and Lessor.

§ XXVI. LIMITATIONS, ACCEPTABLE DRIVERS, AND VEHICLE MODIFICATIONS.

36. The Vehicle shall not be operated by drivers without an appropriate valid license or by those restricted under the insurance policy.

37. Lessee agrees that it will not permit the Vehicle to be located in a state other than the state in which the Vehicle is titled for any continuous period that would require the Vehicle to become subject to the titling and/or registration laws of such other state.

38. Using the Vehicle on trips of less than sixty (60) days within continental North America is permitted. Any exceptions require Lessor's prior written consent.

39. Any modifications or cosmetic additions to the Vehicle are not permitted without the Lessor's prior written consent.

§ XXVII. WAIVER.

40. The failure of either Party to enforce any provision of this Lease shall not be construed as a waiver or limitation of that Party's right to subsequently enforce and compel strict compliance with every provision of this Lease.

§ XXVIII. WARRANTIES.

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§ XXIX. EARLY TERMINATION.

42. Except as otherwise required by applicable law, there is no cancellation period before the end of this Lease. This Lease may only be terminated with the agreement of the Lessor or upon proven and valid legal cause.

§ XXX. INSPECTION.

43. Lessor and Lessee acknowledge that the Vehicle has been inspected and that the Lessee accepts the Vehicle as being in good condition, exclusive of manufacturer's defects.

§ XXXI. ENTIRE AGREEMENT AND MODIFICATION.

44. This Lease constitutes the entire agreement between the Parties and supersedes all prior negotiations, representations, and agreements, whether written or oral. No modification or amendment of this Lease shall be effective unless in writing and signed by both Parties.

§ XXXII. INDEMNIFICATION.

45. Lessee agrees to indemnify, defend, and hold harmless the Lessor from and against any and all loss, liability, claims, and expenses (including reasonable attorney's fees) arising from the maintenance, operation, possession, or use of the Vehicle, and shall keep the Vehicle free from encumbrances, fines, liens, and claims.

§ XXXIII. GOVERNING LAW AND VENUE.

46. This Lease shall be governed by and construed in accordance with the laws of the State of ________, without regard to its conflict-of-laws principles. The Parties consent to the exclusive jurisdiction and venue of the state and federal courts located in ________ County, in such State.

§ XXXIV. COUNTERPARTS.

47. This Lease may be executed in counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. Electronic and facsimile signatures shall be deemed valid and binding pursuant to the Electronic Signatures in Global and National Commerce Act (15 U.S.C. § 7001 et seq.) and applicable state law.

IN WITNESS WHEREOF, the Parties have executed this Vehicle Lease Agreement as of the Effective Date.

SIGNATURE OF LESSOR:

By: _______________________________________
Name: ________

Title: ________

Date: ________

SIGNATURE OF LESSEE:

By: _______________________________________
Name: ________

Date: ________