South Dakota Business Equipment Purchase and Sale Agreement

BUSINESS EQUIPMENT PURCHASE AND SALE AGREEMENT

(South Dakota — Attorney-Review Template)

B2B USE ONLY. Do not use this form for a consumer purchase, household equipment, or a transaction governed by special agricultural, vehicle, dealership, franchise, health-care, public-procurement, or financing laws without separate review.

This Business Equipment Purchase and Sale Agreement (the “Agreement”) is made as of [DATE] by and between:

Seller: [LEGAL NAME, ENTITY TYPE, STATE, ADDRESS]
Buyer: [LEGAL NAME, ENTITY TYPE, STATE, ADDRESS]

Seller and Buyer agree as follows.

1. Equipment and Included Items

Seller will sell and Buyer will purchase the equipment listed in Exhibit A (the “Equipment”), including only the accessories, embedded software rights, manuals, parts, and other items expressly listed there.

Exhibit A must state for each item:

• manufacturer, model, year, and serial or identification number;
• quantity and condition: new, used, or refurbished;
• operating hours or mileage, if relevant;
• specifications and performance criteria;
• included attachments, software, manuals, and spare parts;
• known damage, defects, repairs, or missing items; and
• any lien or security interest Buyer has agreed in writing to take subject to.

2. Price, Payment, and Taxes

2.1 Purchase Price

The total purchase price is $[AMOUNT], allocated as shown in Exhibit B.

2.2 Payment

Late amounts bear interest at [RATE]% per year or the highest lawful rate, whichever is lower, beginning [NUMBER] days after written notice of nonpayment.

2.3 Sales and Use Tax

As of the verification date, SDCL § 10-45-2 states a 4.2% state tax on taxable retail sales of tangible personal property. The official statute displays a 4.5% version effective July 1, 2027. Local tax, exemptions, sourcing, installation, delivery, trade-in, and bundled-charge treatment must be confirmed for the actual transaction date and location.

Unless Exhibit B states otherwise, Buyer will pay properly invoiced transaction taxes, and Seller will collect and remit taxes that Seller is legally required to collect. A party claiming an exemption must timely provide the documentation Seller reasonably requires.

3. Delivery, Installation, and Risk of Loss

3.1 Delivery

Seller will deliver the Equipment by [DATE] to [DELIVERY LOCATION] under the following delivery term: [PRECISE UCC SHIPPING/DESTINATION TERM; DO NOT MIX UCC “F.O.B.” TERMS WITH INCOTERMS WITHOUT COUNSEL REVIEW].

Freight, rigging, unloading, permits, site work, installation, commissioning, and insurance are allocated in Exhibit C.

3.2 Risk of Loss

Subject to SDCL § 57A-2-510 for a nonconforming tender or other breach, risk of loss passes from Seller to Buyer at [IDENTIFY THE EXACT EVENT]. Title passes at [IDENTIFY THE EXACT EVENT], subject to any security interest granted in Section 10.

3.3 Delay

A delayed party must promptly give written notice describing the cause, expected duration, and mitigation steps. If an excused delay continues more than [NUMBER] days, [BUYER / EITHER PARTY] may terminate the undelivered portion by written notice.

4. Inspection, Testing, Acceptance, and Cure

4.1 Inspection and Testing

Buyer will have [NUMBER] business days after [DELIVERY / COMPLETION OF COMMISSIONING] to inspect and test the Equipment against Exhibit A and the acceptance test in Exhibit C. This contract period should allow a reasonable opportunity to inspect under SDCL § 57A-2-513.

4.2 Rejection Notice

Within the inspection period, Buyer may give a written notice identifying each claimed nonconformity with reasonable detail and stating whether Buyer rejects the affected commercial unit or accepts it subject to an agreed cure. Mere silence before a reasonable opportunity to inspect does not itself create acceptance.

4.3 Acceptance

Acceptance occurs as provided in SDCL § 57A-2-606, including when Buyer, after a reasonable opportunity to inspect:

1. states that the Equipment conforms or will be retained despite nonconformity;
2. fails to make an effective rejection; or
3. acts inconsistently with Seller's ownership, subject to the statute.

Acceptance does not waive rights that cannot be waived by this Agreement. Any attempted revocation of acceptance must satisfy SDCL § 57A-2-608, including timely notice and substantial impairment.

4.4 Cure

Seller retains any right to cure under SDCL § 57A-2-508. If Buyer gives a timely rejection notice, Seller will notify Buyer within [NUMBER] business days whether Seller elects to cure and will complete any agreed or legally available cure by [DATE / REASONABLE PERIOD].

5. Seller's Express Warranties

Seller expressly warrants that, during [WARRANTY PERIOD]:

1. the Equipment will conform to the descriptions, specifications, samples, models, and performance criteria expressly made part of the basis of the bargain in Exhibit A;
2. Seller will convey good title and make a rightful transfer, free of undisclosed security interests, liens, or encumbrances;
3. [NEW EQUIPMENT] the Equipment will be new and free from defects in material and workmanship; and/or
4. [USED/REFURBISHED EQUIPMENT] the Equipment's warranted condition is limited to: [STATE PRECISELY].

Seller will [repair / replace / refund] a warranted nonconformity reported during the warranty period, subject to Section 7.

6. Implied-Warranty Election

Select one option and delete the others. Counsel should confirm conspicuous presentation in the final signed version.

☐ Option A — Implied Warranties Retained

The implied warranties arising under applicable law, including merchantability and fitness for a particular purpose when their statutory conditions are met, are not disclaimed.

☐ Option B — Express Warranty Only

EXCEPT FOR THE EXPRESS WARRANTIES IN SECTION 5, SELLER DISCLAIMS THE IMPLIED WARRANTY OF MERCHANTABILITY AND ANY IMPLIED WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE. THERE ARE NO WARRANTIES THAT EXTEND BEYOND THE EXPRESS DESCRIPTION AND PROMISES IN THIS AGREEMENT.

☐ Option C — Negotiated “As Is” Used-Equipment Sale

EXCEPT FOR THE WARRANTY OF TITLE IN SECTION 5.2 AND ANY EXPRESS WARRANTY THAT CANNOT REASONABLY BE CONSTRUED AS CONSISTENT WITH THIS DISCLAIMER, BUYER PURCHASES THE EQUIPMENT “AS IS” AND “WITH ALL FAULTS.” SELLER DISCLAIMS THE IMPLIED WARRANTY OF MERCHANTABILITY AND ANY IMPLIED WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE.

Under SDCL § 57A-2-316, a written merchantability disclaimer must mention merchantability and be conspicuous; a fitness disclaimer must be written and conspicuous. Express warranties and inconsistent disclaimers are construed under subsection (1), so the parties must not promise a characteristic in Exhibit A and purport to disclaim the same promise here.

7. Limited Remedy and Damages Election

7.1 Limited Remedy

For breach of the Equipment warranty, Buyer's remedy is [CHOOSE: repair / replacement / refund / nonexclusive UCC remedies]. If the parties intend that remedy to be exclusive, state: “THIS REMEDY IS EXCLUSIVE.” If an exclusive or limited remedy fails of its essential purpose, SDCL § 57A-2-719(2) applies.

7.2 Optional Commercial-Loss Exclusion

Select and tailor only for a negotiated B2B transaction:

☐ Consequential-Damages Exclusion

NEITHER PARTY IS LIABLE TO THE OTHER FOR CONSEQUENTIAL, SPECIAL, INCIDENTAL, EXEMPLARY, OR PUNITIVE DAMAGES ARISING FROM THIS AGREEMENT, INCLUDING LOST PROFITS OR LOST PRODUCTION, EXCEPT TO THE EXTENT THE CLAIM INVOLVES PERSONAL INJURY, FRAUD, WILLFUL MISCONDUCT, BREACH OF THE TITLE WARRANTY, OR AN EXPRESS INDEMNITY THAT SPECIFICALLY COVERS THE LOSS.

SDCL § 57A-2-719(3) permits a consequential-damages limitation unless unconscionable, treats a personal-injury limitation involving consumer goods as prima facie unconscionable, and does not treat a commercial-loss limitation the same way. This form excludes consumer use and carves out personal injury, but counsel must still assess enforceability and bargaining context.

7.3 Optional Aggregate Cap

☐ Liability Cap

Except for [PAYMENT / TITLE / FRAUD / WILLFUL MISCONDUCT / PERSONAL INJURY / SPECIFIED INDEMNITIES], each party's aggregate liability under this Agreement will not exceed [AMOUNT OR FORMULA].

8. Installation, Training, and Documentation

Seller will provide only the installation, commissioning, training, manuals, software access, safety materials, and service items listed in Exhibits C and D. Each exhibit must allocate:

• site preparation and utilities;
• permits, rigging, unloading, and integration;
• safety responsibilities and lockout/tagout procedures;
• test protocol and objective acceptance criteria;
• operator and maintenance training;
• manuals, drawings, parts lists, and software credentials; and
• completion dates and responsible personnel.

9. Indemnification

9.1 Seller

Seller will defend and indemnify Buyer against third-party claims to the extent caused by [CHOOSE AND TAILOR: bodily injury/property damage from a proven defect; Seller's negligence or willful misconduct; infringement by Seller-designed Equipment; undisclosed liens].

9.2 Buyer

Buyer will defend and indemnify Seller against third-party claims to the extent caused by [CHOOSE AND TAILOR: unauthorized modification; misuse contrary to written instructions; Buyer-provided specifications; Buyer's negligence or willful misconduct].

9.3 Procedure

The indemnified party must promptly notify the indemnifying party, allow reasonable control of the defense, and provide reasonable cooperation. No settlement may admit fault by or impose nonmonetary duties on the indemnified party without its written consent.

10. Optional Seller Financing and Security Interest

Delete this section if Seller is paid in full at or before delivery. Article 9 filing and priority depend on debtor location, collateral type, fixtures, other liens, and timing; obtain secured-transactions review.

☐ Security Interest Granted

To secure unpaid purchase-price obligations, Buyer grants Seller a security interest in the Equipment described in Exhibit A and identifiable proceeds. Buyer authorizes Seller to file financing statements and amendments that accurately describe the collateral and transaction.

The parties intend purchase-money treatment only to the extent SDCL § 57A-9-103 applies. For equipment other than inventory or livestock, SDCL § 57A-9-324(a) gives the stated priority only if the PMSI is perfected when Buyer receives possession or within twenty days afterward. If South Dakota law governs perfection and no real-property filing category applies, SDCL § 57A-9-501 generally designates the Secretary of State; counsel must determine the actual governing filing law and whether a fixture filing is required.

After default, Seller may exercise secured-party rights only as permitted by Article 9. Any nonjudicial possession must proceed without breach of the peace under SDCL § 57A-9-609.

11. Default and Termination

A material breach is a default if it remains uncured for [NUMBER] days after written notice, except that [PAYMENT / INSOLVENCY / UNAUTHORIZED TRANSFER] has the following cure rule: [RULE].

Upon default, the nondefaulting party may terminate the unperformed portion and pursue remedies available under this Agreement and applicable law, subject to enforceable limitations in Section 7. Termination does not unwind an accepted and paid-for commercial unit unless the Agreement or applicable law provides that remedy.

12. Limitations Period

SDCL § 57A-2-725 provides a four-year limitations period for breach of a contract for sale. It generally states that accrual occurs when the breach occurs regardless of knowledge, and that a warranty breach occurs at tender unless an explicit future-performance warranty makes discovery await future performance. Counsel must calendar accrual based on the actual claim and warranty wording.

13. Confidentiality and Embedded Software

Each party will protect nonpublic technical, pricing, security, and business information received from the other using at least reasonable care and use it only to perform this Agreement. The obligation does not cover information the recipient proves was public without breach, already lawfully known, independently developed, or lawfully received without restriction.

Any embedded-software license, remote-access right, data collection, update obligation, cybersecurity requirement, and post-sale support restriction must be stated in Exhibit D. Ownership of the physical Equipment does not, by itself, define the scope of separate software rights.

14. Insurance and Compliance

Before delivery, each party will maintain the insurance stated in Exhibit E. Seller is responsible for legal compliance applicable to Seller's manufacture and tender; Buyer is responsible for site, operator, and use compliance after risk of loss passes, except to the extent a claim results from Seller's breach.

15. Dispute Terms

South Dakota law governs this Agreement, without applying a choice-of-law rule that would select another jurisdiction's law. The parties consent to [STATE COURT IN COUNTY, SOUTH DAKOTA / U.S. DISTRICT COURT WITH SUBJECT-MATTER JURISDICTION] and waive objections to personal jurisdiction and venue to the extent enforceable.

No jury waiver is included. Arbitration applies only if the parties sign a separately reviewed arbitration addendum identifying the administrator, rules, seat, allocation of fees, interim-relief procedure, and judgment court.

16. General Terms

1. Entire agreement. This Agreement and its exhibits are the complete agreement concerning the Equipment.
2. Priority. If documents conflict, the order of priority is: [AGREEMENT / SIGNED CHANGE ORDER / EXHIBITS / PURCHASE ORDER]. Preprinted or click-through terms do not amend this Agreement unless both parties sign an express amendment.
3. Changes. An amendment or waiver must be in a writing signed by the party to be charged.
4. Assignment. Neither party may assign this Agreement without the other's written consent, except [PERMITTED ASSIGNMENT].
5. Notices. Notices must be sent to the addresses above by [METHODS] and are effective [RULE].
6. Counterparts. The parties may sign counterparts and exchange agreed electronic copies, each intended as an original.
7. Severability. An unenforceable term will be narrowed only to the extent necessary, and the remainder will continue if the essential bargain remains enforceable.
8. No third-party beneficiaries. No person other than a stated indemnified party has rights under this Agreement.
9. Survival. Payment, warranty, confidentiality, indemnity, security-interest, dispute, and accrued-remedy provisions survive to the extent their purpose requires.

17. Signatures

SELLER

BUYER

Selected negotiated options:

• Implied-warranty election: [A / B / C] — Seller initials: _____ Buyer initials: _____
• Consequential-damages exclusion: [INCLUDED / DELETED] — Seller initials: _____ Buyer initials: _____
• Aggregate liability cap: [INCLUDED / DELETED] — Seller initials: _____ Buyer initials: _____
• Seller security interest: [INCLUDED / DELETED] — Seller initials: _____ Buyer initials: _____

EXHIBIT A — EQUIPMENT SCHEDULE

Included accessories, software, manuals, parts, and exclusions: [DETAIL]

Known liens or permitted security interests: [NONE / DETAIL]

EXHIBIT B — PRICE AND TAX SCHEDULE

EXHIBIT C — DELIVERY, INSTALLATION, AND ACCEPTANCE TEST

• Delivery location and term: [DETAIL]
• Site-preparation obligations: [DETAIL]
• Installation scope: [DETAIL]
• Commissioning test: [OBJECTIVE STEPS]
• Pass/fail criteria: [OBJECTIVE CRITERIA]
• Inspection period: [NUMBER] business days after [EVENT]
• Form of acceptance certificate: [ATTACH / DESCRIBE]

EXHIBIT D — TRAINING, DOCUMENTATION, SOFTWARE, AND SUPPORT

[STATE DELIVERABLES, LICENSE TERMS, ACCESS, UPDATES, CYBERSECURITY, DATA USE, TRAINING, SERVICE LEVELS, PARTS AVAILABILITY, AND FEES.]

EXHIBIT E — INSURANCE

FINAL COUNSEL CHECK

• ☐ Confirm this is a business transaction and not a consumer sale.
• ☐ Confirm every Equipment description, serial number, condition disclosure, and acceptance criterion.
• ☐ Verify the tax rate and sourcing on the transaction date; the current statute changes on July 1, 2027 unless amended again.
• ☐ Make the delivery term and risk-of-loss event unambiguous.
• ☐ Delete unused warranty, damages, and security-interest options.
• ☐ Make selected disclaimers conspicuous in the final signed format.
• ☐ If Seller finances the price, complete debtor-location, fixture, prior-lien, filing-office, and PMSI-timing analysis before delivery.
• ☐ Calendar the UCC limitations period from the correct accrual date.

OFFICIAL SOURCES

• South Dakota Codified Laws § 57A-2-312
• South Dakota Codified Laws § 57A-2-316
• South Dakota Codified Laws § 57A-2-509
• South Dakota Codified Laws § 57A-2-606
• South Dakota Codified Laws § 57A-2-719
• South Dakota Codified Laws § 57A-2-725
• South Dakota Codified Laws § 57A-9-324
• South Dakota Codified Laws § 10-45-2