Sample Equipment Lease Agreement With Option To Purchase
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FAQ
What is a lease-option-to-buy? A lease option is a contract in which a landlord and tenant agree that, at the end of a specified period, the renter can buy the property at a specified price. The tenant pays an up-front option fee and an additional amount each month that goes toward the eventual down payment.
(Optional) Section 22: Option to purchase. (a) The Lessee can buy the Equipment at the end of the Term at its fair market value if it performed all of its responsibilities under the Lease. If the Lessee wants to do this, it needs to give written notice to the Lessor a certain amount of time before the end of the Term.
Equipment Lease Types Operating Leases. An operating lease is a contract that permits one company to use another company's equipment in exchange for fixed monthly payments over a specific period of time. ... Finance Leases (or Capital Leases) ... $1 Buyout Lease. ... Purchase Option Lease. ... Sale-Leaseback (or Leaseback) ... TRAC Lease.
These types of clauses provide tenants with the option to purchase the landlord's building after a specified period, for a predetermined and fixed price.
For example, a manufacturer might lease a production machine under a capital lease because they'll use the equipment daily over a number of years. A company with a warehouse might lease forklifts for the same reason. Many capital leases allow the lessee to purchase the equipment at the end of the term.
