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HF 2061

as introduced - 89th Legislature (2015 - 2016) Posted on 03/23/2015 01:20pm

KEY: stricken = removed, old language.
underscored = added, new language.

Bill Text Versions

Engrossments
Introduction Posted on 03/23/2015

Current Version - as introduced

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A bill for an act
relating to commerce; limiting the use of evergreen clauses in certain leases and
contracts; proposing coding for new law in Minnesota Statutes, chapter 325E.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [325E.80] AUTOMATIC RENEWAL CLAUSES; LIMITATION.
new text end

new text begin Subdivision 1. new text end

new text begin Applicability. new text end

new text begin This section applies to leases or other contracts for the
provision of services or equipment entered into between two or more business entities,
including sole proprietors, if the initial term or any renewal of the lease or other contract is
for a period greater than one year.
new text end

new text begin Subd. 2. new text end

new text begin Automatic renewals. new text end

new text begin A lease or other contract described in subdivision 1
must not contain an automatic renewal clause, unless the lease or contract also requires
that the lessor or seller of the services or equipment provide to the lessee or buyer a written
reminder notice of the automatic renewal clause and of the last day upon which the lessee
or buyer may give notice of nonrenewal. The written reminder notice must be provided to
the lessee or buyer no later than 30 days, and no more than 90 days, prior to the last day
upon which the lessee or buyer may give notice of nonrenewal.
new text end

new text begin Subd. 3. new text end

new text begin Remedy. new text end

new text begin An automatic renewal clause for which a written reminder notice
is required under subdivision 2 becomes void if:
new text end

new text begin (1) the lease or contract does not contain the requirement that the written reminder
notice be given; or
new text end

new text begin (2) the written reminder notice is not given at the required time.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2016, and applies to leases
or contracts entered into on or after that date.
new text end