PART 4. 
PERFORMANCE OF LEASE CONTRACT:



REPUDIATED,
SUBSTITUTED, AND EXCUSED



 



§490:2A-401  Insecurity:  adequate assurance
of performance.  (a)  A lease contract imposes an obligation on each party
that the other's expectation of receiving due performance will not be impaired.



(b)  If reasonable grounds for insecurity arise
with respect to the performance of either party, the insecure party may demand
in writing adequate assurance of due performance.  Until the insecure party
receives that assurance, if commercially reasonable the insecure party may
suspend any performance for which the insecure party has not already received
the agreed return.



(c)  A repudiation of the lease contract occurs
if assurance of due performance adequate under the circumstances of the
particular case is not provided to the insecure party within a reasonable time,
not to exceed thirty days after receipt of a demand by the other party.



(d)  Between merchants, the reasonableness of
grounds for insecurity and the adequacy of any assurance offered must be
determined according to commercial standards.



(e)  Acceptance of any nonconforming delivery
or payment does not prejudice the aggrieved party's right to demand adequate
assurance of future performance. [L 1991, c 40, pt of §1]