GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1993

S	1 

SENATE BILL 1628

Short Title:  TRAC Lease Not Sale or Security Interest.    	(Public)
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Sponsors: Senators Speed, Hoyle, Lee, Marshall, Martin of Pitt, Plexico, Simpson, and Smith.
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Referred to:  Finance.
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June 1, 1994

A BILL TO BE ENTITLED
AN ACT CLARIFYING THAT A MOTOR VEHICLE OPERATING LEASE THAT CONTAINS A TERMINAL RENTAL ADJUSTMENT CLAUSE IS NOT A SALE AND DOES NOT CREATE A SECURITY INTEREST IN THE LEASED PROPERTY.
The General Assembly of North Carolina enacts:
Section 1.  G.S. 25-2A-103(1)(j) reads as rewritten:
"(j)	'Lease' means a transfer of the right to possession and use of goods for a term in return for consideration, but a sale, including a sale on approval or a sale or return, or retention or creation of a security interest is not a lease.  Unless the context clearly indicates otherwise, the term includes a sublease.  The term includes a motor vehicle operating agreement that is considered a lease under § 7701(h) of the Internal Revenue Code."
Sec. 2.  This act is effective upon ratification.