EQUIPMENT LEASE AGREEMENT

(UCC Article 2A Master Lease Form)

[// GUIDANCE: This template is drafted to comply with the Uniform Commercial Code Article 2A (“UCC 2A”) as promulgated by the American Law Institute and the Uniform Law Commission. Confirm adoption status and any state-specific modifications before use.]

TABLE OF CONTENTS

1. Document Header
2. Definitions
3. Operative Provisions
   3.1 Lease of Equipment
   3.2 Term & Renewal
   3.3 Delivery; Acceptance Certificate
   3.4 Rent; Payment Mechanics
   3.5 Security Deposit
   3.6 Taxes & Fees
   3.7 Use & Compliance
   3.8 Maintenance & Repairs
   3.9 Insurance
   3.10 Inspection Rights
   3.11 Return of Equipment
4. Representations & Warranties
5. Covenants & Restrictions
6. Default & Remedies
7. Risk Allocation
   7.1 Indemnification
   7.2 Limitation of Liability
   7.3 Force Majeure
8. Dispute Resolution
9. General Provisions
10. Execution Block

1. DOCUMENT HEADER

EQUIPMENT LEASE AGREEMENT (this “Agreement”) is entered into as of [EFFECTIVE DATE] (the “Effective Date”) by and between:

(a) [Lessor Legal Name], a [State/Country] [entity type] with offices at [Address] (“Lessor”); and

(b) [Lessee Legal Name], a [State/Country] [entity type] with offices at [Address] (“Lessee”).

Recitals

A. Lessor is the owner of certain equipment described herein and is willing to lease such equipment to Lessee.
B. Lessee desires to lease the equipment on the terms and conditions set forth in this Agreement.
C. The parties intend that this Agreement constitute a “finance lease” or “true lease” under U.C.C. Article 2A.

NOW, THEREFORE, in consideration of the mutual covenants herein, the parties agree as follows:

2. DEFINITIONS

For purposes of this Agreement, capitalized terms have the meanings set forth below:

“Acceptance Certificate” – A certificate in the form of Exhibit A executed by Lessee confirming that the Equipment has been delivered, installed, inspected, and accepted.

“Business Day” – Any day other than a Saturday, Sunday, or legal holiday in the jurisdiction where payment is to be made.

“Casualty Loss” – Any loss, theft, destruction, or damage of the Equipment that renders it unusable for its intended purpose.

“Commencement Date” – The date set forth in the applicable Acceptance Certificate on which the Lease Term for the Equipment commences.

“Equipment” – The personal property (including all replacements, parts, additions, and accessories) more fully described in Schedule 1.

“Event of Default” – Any event specified in Section 6.1.

“Lease Term” – As defined in Section 3.2.

“Losses” – Any and all claims, damages, liabilities, penalties, fines, losses, costs, and expenses (including reasonable attorneys’ fees).

“Rent” – The periodic payments due under Section 3.4 for use of the Equipment.

“UCC” – The Uniform Commercial Code as adopted and in effect in the Governing Law Jurisdiction.

[// GUIDANCE: Add additional defined terms alphabetically as needed for your transaction.]

3. OPERATIVE PROVISIONS

3.1 Lease of Equipment

Lessor hereby leases to Lessee, and Lessee hereby leases from Lessor, the Equipment described in Schedule 1, subject to the terms and conditions of this Agreement.

3.2 Term & Renewal

(a) Lease Term. The Lease Term shall commence on the Commencement Date and continue for [X] months (the “Initial Term”) unless earlier terminated pursuant to this Agreement.
(b) Renewal. The Lease Term shall automatically renew for successive periods of [X] months each (each, a “Renewal Term”) unless either party delivers written notice of non-renewal at least [Y] days before the expiration of the then-current term.

3.3 Delivery; Acceptance Certificate

(a) Delivery. Lessor shall deliver the Equipment to Lessee FCA (Incoterms 2020) [Delivery Location] on or before [Date].
(b) Risk of Loss. Risk of loss passes to Lessee upon Lessor’s tender of delivery. See U.C.C. § 2A-219(1)(b).
(c) Acceptance. Within [Z] Business Days after installation, Lessee shall execute and return the Acceptance Certificate or deliver written notice of any non-conformity. Failure to do either within such period constitutes deemed acceptance.

3.4 Rent; Payment Mechanics

(a) Rent Schedule. Lessee shall pay Rent in the amounts and on the dates set forth in Schedule 2.
(b) Manner of Payment. All payments shall be made by ACH or wire transfer of immediately available funds to the account designated by Lessor.
(c) Late Charges. Any Rent not paid within [5] Business Days of the due date shall accrue a late charge of [1.5%] per month or the maximum lawful rate, whichever is lower.
(d) Net Lease. THIS IS A NET LEASE. Lessee’s obligation to pay Rent is absolute and unconditional and shall not be subject to set-off, counterclaim, or deduction of any kind.

3.5 Security Deposit

Lessee shall deliver to Lessor on the Effective Date a security deposit of [$Amount] (the “Security Deposit”), which Lessor may apply toward any unpaid Rent or other obligations. Any unused balance shall be returned to Lessee within [30] days after all obligations have been satisfied.

3.6 Taxes & Fees

Lessee shall pay, reimburse, and hold Lessor harmless from all sales, use, excise, personal property, and other taxes, fees, and assessments imposed on the ownership, leasing, or use of the Equipment, excluding taxes based on Lessor’s net income.

3.7 Use & Compliance

Lessee shall (i) use the Equipment solely in the ordinary course of its business, (ii) comply with all applicable laws, regulations, manufacturer specifications, and insurance requirements, and (iii) not affix the Equipment to real property without Lessor’s prior written consent.

3.8 Maintenance & Repairs

Lessee shall, at its sole expense, maintain the Equipment in good operating condition, perform all required maintenance, and make all repairs necessary to keep the Equipment in compliance with Section 3.7.

3.9 Insurance

(a) Coverage. Lessee shall maintain (i) all-risk property insurance covering the Equipment for not less than the replacement cost, and (ii) general liability insurance with limits of at least [$Amount] per occurrence.
(b) Endorsements. Insurance policies shall name Lessor as loss payee (property) and additional insured (liability) and shall provide for [30] days’ prior written notice of cancellation or material change.
(c) Certificates. Lessee shall deliver certificates of insurance to Lessor upon execution and annually thereafter.

3.10 Inspection Rights

Upon [reasonable] prior notice, Lessor may inspect the Equipment and related maintenance records during normal business hours.

3.11 Return of Equipment

Within [10] Business Days after termination of the Lease Term, Lessee shall, at its expense, return the Equipment to [Return Location] in good repair (ordinary wear and tear excepted) and free of liens.

4. REPRESENTATIONS & WARRANTIES

4.1 Mutual Representations. Each party represents that:
(a) It is duly organized, validly existing, and in good standing under the laws of its jurisdiction of formation;
(b) It has full power and authority to execute and perform this Agreement; and
(c) This Agreement constitutes a legal, valid, and binding obligation enforceable against such party.

4.2 Additional Lessor Warranties. Lessor warrants that:
(a) It has good title to the Equipment free of all liens (other than any permitted liens disclosed on Schedule 3); and
(b) It will not interfere with Lessee’s quiet enjoyment of the Equipment, subject to Lessee’s compliance with this Agreement.

4.3 Disclaimer of Warranties. EXCEPT AS EXPRESSLY SET FORTH IN SECTION 4.2, LESSOR MAKES NO WARRANTIES, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. See U.C.C. § 2A-214(2).

4.4 Survival. All representations and warranties survive execution and continue until all obligations of the parties have been fully performed.

5. COVENANTS & RESTRICTIONS

5.1 Negative Covenants. Lessee shall not:
(a) Sublease, assign, or grant any security interest in the Equipment without Lessor’s prior written consent;
(b) Alter or modify the Equipment in any manner that materially impairs its value or intended use; or
(c) Relocate the Equipment outside [Permitted Territory] without Lessor’s prior written consent.

5.2 Affirmative Covenants. Lessee shall:
(a) Promptly notify Lessor of any Casualty Loss or Event of Default;
(b) Maintain complete and accurate operational and maintenance records; and
(c) Provide Lessor with financial statements upon reasonable request.

6. DEFAULT & REMEDIES

6.1 Events of Default

(a) Failure to pay any Rent or other amount within [5] Business Days after written notice of non-payment;
(b) Material breach of any covenant or representation that is not cured within [30] days after written notice;
(c) Misrepresentation, insolvency, bankruptcy, or receivership of Lessee; or
(d) Unauthorized sale, transfer, or encumbrance of the Equipment.

6.2 Remedies

Upon an Event of Default, Lessor may, without limitation and subject to applicable law:
(a) Accelerate and declare immediately due all unpaid Rent for the remainder of the Lease Term, discounted to present value using a [X]% discount rate;
(b) Take possession of the Equipment without judicial process, or seek replevin or other injunctive relief pursuant to U.C.C. § 2A-525;
(c) Terminate this Agreement and/or any Schedule;
(d) Recover from Lessee damages as permitted under U.C.C. §§ 2A-527 to -529; and
(e) Exercise any other right or remedy available at law or in equity.

6.3 Notice & Cure

Except for payment defaults, Lessor shall give Lessee written notice of default and a [10] Business Day cure period before exercising remedies.

6.4 Attorneys’ Fees

Lessee shall reimburse Lessor for all reasonable costs and attorneys’ fees incurred in enforcing this Agreement or protecting the Equipment, including in bankruptcy proceedings.

7. RISK ALLOCATION

7.1 Indemnification

Lessee shall indemnify, defend, and hold harmless Lessor, its affiliates, and their respective officers, directors, employees, and agents from and against any and all Losses arising from or relating to (i) the possession, use, operation, maintenance, or repair of the Equipment, (ii) Lessee’s breach of this Agreement, or (iii) any claim of personal injury, death, or property damage caused by the Equipment, except to the extent such Losses are caused by Lessor’s gross negligence or willful misconduct. The obligations under this Section 7.1 shall survive termination of this Agreement.

7.2 Limitation of Liability

(a) Consequential Damages. NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY INCIDENTAL, CONSEQUENTIAL, SPECIAL, OR PUNITIVE DAMAGES, INCLUDING LOST PROFITS, ARISING OUT OF OR RELATING TO THIS AGREEMENT.
(b) Liability Cap. Lessor’s aggregate liability under this Agreement shall not exceed an amount equal to the total Rent actually received by Lessor during the twelve (12) months preceding the event giving rise to liability.
[// GUIDANCE: Modify cap to align with “ucc_limits” and business negotiation.]

7.3 Force Majeure

Neither party shall be liable for failure to perform due to causes beyond its reasonable control, including acts of God, war, terrorism, labor disputes, or governmental actions, provided that the affected party gives prompt notice and uses diligent efforts to resume performance.

8. DISPUTE RESOLUTION

8.1 Governing Law. This Agreement and any dispute arising hereunder shall be governed by and construed in accordance with the laws of the [Governing Law State], including U.C.C. Article 2A, without regard to its conflict of laws principles.

8.2 Forum Selection. Each party irrevocably submits to the non-exclusive jurisdiction of the state and federal courts located in [County, State], and waives any objection based on inconvenient forum or lack of personal jurisdiction.

8.3 Optional Arbitration.
[ ] Check here if the parties elect to submit disputes to binding arbitration. If checked:
(a) Any dispute, claim, or controversy arising out of or relating to this Agreement shall be resolved by arbitration administered by [Arbitration Administrator] under its [Rules], and judgment on the award may be entered in any court of competent jurisdiction.
(b) The arbitration shall take place in [City, State], before a panel of [one/three] arbitrator(s).
(c) The arbitrator(s) shall have authority to grant injunctive relief consistent with this Agreement.

8.4 Injunctive Relief & Replevin. Nothing herein limits Lessor’s right to seek replevin or other provisional remedies with respect to the Equipment under U.C.C. § 2A-525 or applicable law.

[// GUIDANCE: Jury waiver is intentionally omitted per metadata.]

9. GENERAL PROVISIONS

9.1 Amendments & Waivers. No amendment or waiver of any provision shall be effective unless in writing and signed by both parties. A waiver on one occasion is not a waiver on any subsequent occasion.

9.2 Assignment. Lessee may not assign, delegate, or transfer its rights or obligations without Lessor’s prior written consent. Any attempted assignment in violation of this Section is void.

9.3 Successors & Assigns. This Agreement binds and benefits the parties and their respective permitted successors and assigns.

9.4 Severability. If any provision is held invalid or unenforceable, the remaining provisions shall remain in full force, and the invalid provision shall be reformed to the minimum extent necessary to reflect the parties’ intent.

9.5 Entire Agreement. This Agreement, together with all Schedules and Exhibits, constitutes the entire understanding between the parties and supersedes all prior or contemporaneous agreements or understandings.

9.6 Notices. All notices must be in writing and delivered (i) in person, (ii) by certified mail (return receipt requested), (iii) by nationally recognized overnight courier, or (iv) by email with confirmation of receipt, to the addresses set forth above (or as later designated).

9.7 Counterparts; Electronic Signatures. This Agreement may be executed in counterparts, each of which is deemed an original, and all of which together constitute one instrument. Signatures delivered by electronic means (e.g., DocuSign, PDF) are deemed original for all purposes.

10. EXECUTION BLOCK

IN WITNESS WHEREOF, the parties have executed this Equipment Lease Agreement as of the Effective Date.

[OPTIONAL NOTARY BLOCK – insert if required by governing state law.]

EXHIBIT A – FORM OF ACCEPTANCE CERTIFICATE

[// GUIDANCE: Attach a short certificate for Lessee to acknowledge delivery and acceptance, triggering Rent commencement.]

SCHEDULE 1 – EQUIPMENT DESCRIPTION

[Detailed listing of make, model, serial numbers, location, and any key specifications.]

SCHEDULE 2 – RENT PAYMENT SCHEDULE

[Insert periodic Rent amounts, due dates, and escalation (if any).]

SCHEDULE 3 – PERMITTED LIENS (if any)

[Describe any encumbrances, purchase-money security interests, or manufacturer retention rights.]

[// GUIDANCE: Prior to execution, counsel should (i) file UCC financing statements or precautionary filings if desired, (ii) confirm insurance certificates, and (iii) review state-specific amendments to U.C.C. 2A that may affect remedies or notice periods.]