KRS 355.2A-518: Cover -- Substitute goods.

(1) After a default by a lessor under the lease contract of the type described in KRS

355.2A-508(1), or, if agreed, after other default by the lessor, the lessee may cover

by making any purchase or lease of or contract to purchase or lease goods in

substitution for those due from the lessor.

(2) Except as otherwise provided with respect to damages liquidated in the lease

agreement (KRS 355.2A-504) or otherwise determined pursuant to agreement of the

parties (KRS 355.1-302 and 355.2A-503), if a lessee's cover is by a lease agreement

substantially similar to the original lease agreement and the new lease agreement is

made in good faith and in a commercially reasonable manner, the lessee may

recover from the lessor as damages:

(a) The present value, as of the date of the commencement of the term of the new

lease agreement, of the rent under the new lease agreement applicable to that

period of the new lease term which is comparable to the then remaining term

of the original lease agreement minus the present value as of the same date of

the total rent for the then remaining lease term of the original lease agreement;

and

(b) Any incidental or consequential damages, less expenses saved in consequence

of the lessor's default.

(3) If a lessee's cover is by lease agreement that for any reason does not qualify for

treatment under subsection (2) of this section, or is by purchase or otherwise, the

lessee may recover from the lessor as if the lessee had elected not to cover and KRS

355.2A-519 governs.