2023 Louisiana Laws › Revised Statutes › Title 9 - Civil Code-Ancillaries › §9:3306. Definitions

RS 9:3306 - Definitions
(1) "Adjusted capitalized cost" means the capitalized cost of the leased equipment less any capitalized cost reduction payments made by the lessee at the inception of the lease.
(2) "Agricultural purpose" means a purpose related to the production, harvest, exhibition, marketing, transportation, processing, or manufacture of agricultural products by a natural person who cultivates, plants, propagates, or nurtures the agricultural products. "Agricultural products" includes products such as horticultural and dairy products, livestock, wildlife, poultry, bees, forest products, fish and shell fish, and any products thereof, including processed and manufactured products, and any and all products raised or produced on farms and any processed or manufactured products thereof.
(3) "Base term" or "base lease term" of lease means the initial term of the lease as provided under the lease agreement. If a lease is cancelled or terminated for any reason during a renewal period as provided under the lease agreement, "base term" shall mean that renewal period.
(4) "Capitalized cost" means the cost of the leased equipment which is taken into consideration by the lessor in pricing the lease to the lessee.
(5) "Capitalized cost reduction payments" mean any payment or payments made by the lessee at the inception of the lease to reduce the capitalized cost of the leased equipment and therefore to reduce the amount of rental payments which would otherwise be charged under the lease.
(6) "Commercial lease" means a lease to a natural person, corporation, partnership, government, governmental agency or instrumentality, or any other type of entity, primarily for a business, commercial, or agricultural purpose.
(7) "Conditional sale" means a legal arrangement under which a seller sells goods or movable property to a purchaser on a deferred payment or credit basis, with the seller retaining legal title and ownership of the property until such time as the purchase price is paid in full.
(8) "Consumer" means a natural person entering into a lease primarily for a personal, family, or household purpose.
(9) "Consumer lease" means a lease to a consumer as defined in R.S. 9:3306(8), provided that total compensation under the lease over the base lease term does not exceed twenty-five thousand dollars. Where total compensation under the lease exceeds twenty-five thousand dollars, the lease shall be considered a commercial lease for purposes of this Chapter. A lease provided through an employer-sponsored lease program shall not be considered a consumer lease for the purposes of this Chapter.
(10) "Equipment" means movable property.
(11) "Estimated end of term residual value" means the estimated value of the leased property at the end of the base lease term as specified by the lessor at the time the lease is entered into.
(12)(a) "Financed lease" means a lease entered into prior to January 1, 1990, under which:
(i) The lessee is obligated to pay total compensation over the base lease term which is substantially equivalent to or which exceeds the initial value of the leased property; and
(ii) The lessee is obligated to become, or has the option of becoming, the owner of the leased property upon termination of the lease for no additional consideration or for nominal consideration.
(b) After January 1, 1990, a "financed lease" for purposes of this Chapter means a lease entered into on or after that effective date that is classified as a security interest as provided under R.S. 10:1-201(35).
(13) "Initial value" of leased equipment means the price for which the lessee could purchase the leased equipment from the lessor, where appropriate, on an all cash basis in the ordinary course of business. "Initial value" includes the cost of the leased equipment to the lessor plus, where applicable, any increase or markup by the lessor prior to consummation of the lease.
(14) "Interest rate charges" mean interest, time-price differential or time-value of money charges which are capitalized into equipment leases as compensation to the lessor for deferred payment under the lease. Interest rate charges generally represent the difference between (a) total compensation payable to the lessor over the base lease term, less (b) the adjusted capitalized cost of the leased equipment.
(15) "Lease" means a contract or agreement of lease of any movable property, whether for a fixed term or for an indefinite period.
(16) "Lessee" means the lessee under a lease as defined above or his sublessee or assignee.
(17) "Lessor" means the lessor in a lease as defined above, his assignee or designee, or sublessor, assignee, or designee.
(18) "Mandatory purchase price" means the purchase price of the leased equipment which the lessee is obligated to pay at the conclusion of the base lease term, exclusive of official fees and taxes.
(19) "Movable property" or "movables" means corporeal movables, as provided under Civil Code Article 471.
(20) "Nominal consideration" means a sum which is less than twenty-five percent of the fair market value of the leased equipment upon conclusion of the base term of the lease.
(21) "Optional purchase price" of leased equipment means the price for which the lessee has the option to purchase the leased equipment from the lessor at the conclusion of the base term of the lease.
(22) "Property" means any movable subject to a lease.
(23) "Realized value" means:
(a) The price received by the lessor for the leased property at disposition,
(b) The highest offer received for the leased property at disposition, or
(c) The fair market value of the leased property at the conclusion of the lease.
(24) "Short-term lease" means a lease for a term not exceeding four months. Any lease of less than four months containing a provision whereby the term of the lease may be automatically extended or reconducted beyond a period of four months shall not be deemed a short-term lease.
(25) "Total compensation" under the lease means the sum of any capitalized cost reduction payments made at the inception of the lease, plus the total of rental payments payable over the base lease term, exclusive of additional lease related charges, early termination charges, end of lease charges, late charges, deferral charges, and the optional purchase price of the leased equipment as defined herein. Where the lessee is obligated to purchase the leased equipment at the conclusion of the lease term, the mandatory purchase price of the equipment shall be included in the total compensation under the lease.
(26)(a) "True lease" means a lease entered into before January 1, 1990, under which:
(i) The lessee has no obligation to pay total compensation over the base lease term which is substantially equivalent to or in excess of the initial value of the leased property; or
(ii) The lessee does not have the option or obligation to become the owner of the leased property upon termination of the lease for no or nominal consideration.
(b) A true lease also means a lease entered into after January 1, 1990, that is not classified as a security interest as provided under R.S. 10:1-201(35).
(c) Consistent with R.S. 10:9-505, the filing of a financing statement by a lessor under a true lease shall not of itself result in such a lease being classified as a financed lease for purposes of this Chapter or otherwise.
Acts 1985, No. 592, §1, eff. July 13, 1985; Acts 1986, No. 213, §1; Acts 1989, No. 137, §4, eff. Sept. 1, 1989; Acts 2001, No. 128, §4, eff. July 1, 2001; Acts 2006, No. 533, §2; Acts 2012, No. 626, §1, eff. June 7, 2012.