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12. LEASE BALANCE CALCULATION.
In the Purchase Option at End Lease Term disclosure in paragraph 2 i and in paragraphs 13, 16, and 17 the term Lease
Balance is used to describe a component of your liability on scheduled or early termination. For these purposed each monthly payment will be allocated when we receive it
first to taxes, then to lease charges which have accrued on the basis of a 365-day year since the prior monthly payment on the outstanding Adjusted Capitalized Cost and
finally to reduce the outstanding Adjusted Capitalized Cost. The Adjusted Capitalized Cost as of the date you and we sign the lease and before application of the first
monthly lease payment is shown in paragraph 2 g iii. Lease Charges will accrue at the rate implicit in the lease on an actuarial basis assuming a 360-day year of 12 months
of 30 days each,, payments in advance, a lease date of the first day of the month, a payment due date of the first day of the month and payments being made on the exact
due dates and , the outstanding Adjusted Capitalized cost at the end of the Lease Term plus accrued lease charges for the final month equals the Residual Value shown in
paragraph 2 g iv.
The Lease Balance at any time equals the then outstanding Adjusted Capitalized Cost plus any accrued but unpaid lease charges. .These allocations will impact on your
purchase option liability and your liability if this lease is terminated early other than as may be provided in paragraph 18. These allocations may also impact on your
scheduled termination liability. Generally speaking, the Lease Balance will be less if you pay monthly payments early because a greater portion of the monthly payments will
go to reduce the Adjusted Capitalized Cost and will increase if we receive your monthly payments after the due date because a lesser portion of the monthly payments will
go to reduce the Adjusted capitalized Cost.
13. FURTHER PURCHASE OPTION INFORMATION. This is an agreement of leasing only, and unless and until you exercise a purchase option, you do not have and
shall not acquire any ownership rights in the Vehicle. In addition to your end of Lease Term purchase option described in paragraph 2.i., you will have the option to
purchase the Vehicle at any time during the Lease Term. The purchase price will be the sum of the following: (a) any past due monthly payments and any other amounts
caused by your failure to perform your Lease obligations; (b) the Lease Balance defined in paragraph 12; plus (c) any official fees and taxes imposed in connection with
purchase of the Vehicle.
You acknowledge that this is a true lease and you will have absolutely no equity or other ownership rights in the Vehicle or its replacement parts unless you exercise the
purchase option. Whether you purchase the Vehicle during or at the end of the Lease Term, the purchase will be on an AS-IS, WHERE-IS basis, you will give us not less
than 15 days notice of purchase and we will send you or your lender the title when we have received the purchase price.
14. VEHICLE RETURN. Unless you choose to purchase the Vehicle, you agree that upon Lease termination, either early or scheduled, you must return the Vehicle to the
place we will specify. You also agree following vehicle return to pay your termination liability as figured in paragraph 16 or 17, whichever is applicable. If you do not return
the Vehicle to us at scheduled termination as required, you will pay us an additional monthly payment for each month or portion of a month you keep the Vehicle. You also
realize that you are not entitled to keep the Vehicle after the end of the Lease Term and that any retention of the Vehicle beyond the end of the Lease Term without our
consent is a default under the Lease.
15. VEHICLE VALUATION AT EARLY TERMINATION. Your early termination liability if you do not purchase the Vehicle and the Vehicle has not become a casualty loss
may be affected by the Realized Value of the Vehicle. The Realized Value may be determined in one of the following ways: (a) by a written agreement between you and us
if it is signed within 10 days after termination; (b) by a professional appraisal obtained at your expense of the wholesale value of the Vehicle within 10 days after termination,
if you and we can each agree to your selection of an independent third party qualified to make the appraisal; or (c) if the Realized Value is not determined within 10 days
after termination, we will determine the Realized Value by selling the vehicle at wholesale value or in another commercially reasonable manner, such as the highest of 3
bids we receive, we deem appropriate. You realize that the Realized Value amount will be exclusive of any official fees and taxes imposed upon disposition of the Vehicle.
after termination, we will determine the Realized Value by selling the vehicle at wholesale value or in another commercially reasonable manner, such as the highest of 3
bids we receive, we deem appropriate. You realize that the Realized Value amount will be exclusive of any official fees and taxes imposed upon disposition of the Vehicle.
16. EARLY TERMINATION LIABILITY. You may terminate this Lease at any time after you sign it on 15 days prior notice to us. We may terminate it as permitted in
paragraph 19 if this lease is in default or if certain conditions exist as discussed in paragraph 18. If you do not purchase the Vehicle as provided in paragraph 13 and
except as provided in paragraph 18, the amount you owe us upon early termination will be the sum of the following: (a) a disposition charge of $0.00; plus (b) any past due
monthly payments and any other amounts caused by your failure to perform your Lease obligations, including the amount that may be due under paragraph 11; plus (c)
where the Lease Balance Amount calculated under paragraph 12 is greater than the Vehicle’s Realized Value, the difference; plus (d) any official fees and taxes imposed in
connection with Lease termination (for example, sales or use taxes due on a deficiency under “c” above).
17. SCHEDULED TERMINATION LIABILITY. If you do not purchase the Vehicle as provided in paragraph 2.i, the amount you will owe us at the end of the Lease Term
will be the sum of the following: (a) a disposition charge of $0.00; plus (b) any past due monthly payments and any other amounts caused by your failure to perform your
Lease obligations, including the amount that may be due under paragraph 11; plus, (c) any excess mileage charge indicated in paragraph 2.h.; plus, (d) the amount, if any,
by which the Lease Balance defined in paragraph 12 exceeds the Residual Value shown in paragraph 2. g iv; plus (e) any official fees and taxes imposed in connection with
Lease termination (for example, sales or use taxes due on a mileage charge under ”c” above).
18. DAMAGE, LOSS OR POTENTIAL LOSS OF VEHICLE. You agree to be responsible for the risk of loss, damage or destruction of the Vehicle during the Lease Term
and until you return the Vehicle to us or purchase it. If the Vehicle is damaged or destroyed in an accident or otherwise or is confiscated by any governmental authority or is
stolen or is abandoned or is subject to undue peril, you will notify us of such occurrence or condition as soon as possible. If the Vehicle is damaged but is in a condition
which we believe is reasonably repairable, you will have the necessary repairs made promptly. With respect to any other occurrence or condition included above, we
reserve the right to terminate the Lease. If the Lease is terminated, the Lease provides you partial “GAP” protection. Thus, if your insurance company honors our claim for
the Vehicle’s actual cash value, your liability will be limited to the sum of your policy deductible, any other deductions your insurance company makes in honoring our claim,
such as for miles or condition, any other amounts then due under the Lease, applicable taxes and the amount, if any, by which the difference between the Lease Payoff
Amount and the vehicle’s actual cash value exceeds $50,000. If your insurance company does not fully honor our claim, you will be liable for the amount that would then be
due under paragraph 13 to purchase the Vehicle.
19. DEFAULT. If any information in your credit application is false or misleading or if you fail either to make a monthly payment when due or otherwise to perform your
Lease obligations or if you or any guarantor of your Lease obligations becomes insolvent or dies, we can treat this lease as being in default. In the event of a default, we
may do any or all of the following without giving you advance notice: (a) take any reasonable measures designed either to correct the default or to save ourselves from loss,
such as paying any delinquent registration fees which you have not paid as required in paragraph 3 or purchasing insurance to protect our interests if you fail to fulfill your
obligations under paragraph 8, in which case you will pay us for the costs and expenses incurred and also pay us a service charge of $20; (b) terminate the Lease and your
rights to possess and use the Vehicle; (c) take possession of the Vehicle by any method or manner permitted by law; (d) determine your termination liability on any early
termination basis under paragraph 16; (e) apply your security deposit to any amounts you owe; and (f) pursue any other remedy permitted by law. You also agree in the
event of a default to be liable for all collection, repossession, storage, and legal costs, including our attorneys’ fees, to the extent permitted by law and to pay us interest at
18% per annum or at such lesser maximum rate as may be set by law on all those costs and on all your other obligations which you owe us after termination. If you or we
request, any dispute concerning your Lease liability will be decided by binding arbitration. The arbitration would be conducted under the Commercial Arbitration Rules of
the American Arbitration Association. Arbitration would not preclude our utilizing the court system to obtain a repossession order or the like.
20. LIENS AND INDEMNITY. You agree to keep the Vehicle and this Lease free from any liens or encumbrances we do not create. You also agree to indemnify and hold
us harmless against any claim, liability, loss or expenses arising from the operation, condition or ownership of the Vehicle, including those arising from a strict or vicarious
liability claim. You realize your indemnity includes our court costs and attorneys’ fees in connection with any action against which you have indemnified us.
21. SECURITY DEPOSIT. Any security deposit shown in paragraph 2.e.iv. will not be maintained in a separate account, but shall be a general obligation of ours. We may
use this security deposit to pay any amounts that you are required to pay under this Lease, but do not. After you perform all obligations under this Lease, any remaining
balance of the security deposit will be returned to you promptly. No interest or any other form of increase will accrue or be paid to you on the security deposit, unless
otherwise required by law.
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Motor Vehicle Lease Agreement