ROBERT L. EHRLICH, JR., Governor                              Ch. 95

interest if the consideration the lessee is to pay the lessor for the right to possession
and use of the goods is an obligation for the term of the lease not subject to
termination by the lessee, and

(i) The original term of the lease is equal to or greater than
the remaining economic life of the goods,

(ii) The lessee is bound to renew the lease for the remaining
economic life of the goods or is bound to become the owner of the goods,

(iii) The lessee has an option to renew the lease for the
remaining economic life of the goods for no additional consideration or nominal
additional consideration upon compliance with the lease agreement, or

(iv) The lessee has. an option to become the owner of the goods
for no additional consideration or nominal additional consideration upon compliance
with the lease agreement.

(b)     A transaction does not create a security interest merely because
it provides that

(i) The present value of the consideration the lessee is
obligated to pay the lessor for the right to possession and use of the goods is
substantially equal to or is greater than the fair market value of the goods at the time
the lease is entered into,

(ii) The lessee assumes risk of loss of the goods or agrees to
pay taxes, insurance, filing, recording, or registration fees, or service or maintenance
costs with respect to the goods,

(iii) The lessee has an option to renew the lease or to become
the owner of the goods,

(iv) The lessee has an option to renew the lease for a fixed rent
that is equal to or greater than the reasonably predictable fair market rent for the use
of the goods for the term of the renewal at the time the option is to be performed, or

(v) The lessee has an option to become the owner of the goods
for a fixed price that is equal to or greater than the reasonably predictable fair
market value of the goods at the time the option is to be performed.

(c)     For purposes of this subsection (37):

(i) Additional consideration is not nominal if (i) when the
option to renew the lease is granted to the lessee the rent is stated to be the fair
market rent for the use of the goods for the term of the renewal determined at the
time the option is to be performed, or (ii) when the option to become the owner of the
goods is granted to the lessee the price is stated to be the fair market value of the
goods determined at the time the option is to be performed. Additional consideration
is nominal if it is less than the lessee's reasonably predictable cost of performing
under the lease agreement if the option is not exercised;

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