Lease

Why Lease?

1. Simplicity and Convenience

Once a master rental agreement is in place, a lessee can often add equipment whenever,however and wherever they desire. Surveys have consistently ranked this as the mostimportant benefit for lessees, which says something about the frustration levels that canresult from dealing with budgets, bureaucracies and paperwork.

2. Preserving Liquidity

Leasing allows a firm to reserve their cash and borrowing power foroperating expenses and other more intangible costs of doing business.

3. Cash Flow Management

In many cases, lease payments can be structured to match budgetaryor cash flow requirements. If there is no space left in this year’s budget,write a lease with no payments due until next year. If the revenues fromthe use of the equipment increase over time, write a stepped lease wherethe payments also increase over time. Payments can be made monthly,quarterly, semi-annually, annually, or any other way which works best for the lessee.

4. Lower Total Cost of Acquisition

The wild card here remains the residual issue, but in many cases, a properly structured ease will be significantly less expensive than acquiring the same equipment throughoutright purchase, particularly on an after tax basis.

5. Accounting Benefits

Just about any lease can be structured to meet the accounting tests for treatmentas an "operating lease" thereby taking the lease obligation off the main balancesheet, which in turn can help by improving various financial ratios and performance ndicators. In many cases, a lease will eliminate the possibility of a loss on sale whenowned assets are eventually sold. If purchased and then depreciated, just aboutany high tech assets will be on the books at a value in excess of current market values.

6. Tax Benefits

Although each lease will differ, many companies will find the tax deductibility increasedthrough leasing compared to ownership, particularly when dealing with high technologyand other shorter-lived assets.

7. Outsourcing and Asset Management Headaches

Many firms choose to own those assets which tend to appreciate in value (such as real estate)and lease those assets which tend to depreciate in value (such as equipment). By partneringup with a qualified lessor who has real expertise in particular asset classes, a firm can leave theheadache of getting rid of old technology to someone with the expertise and contacts to do soefficiently. If you build into the lease "cancel and return" options as well as early buy out andtechnology refresh options, you can maintain the flexibility to move to new equipment throughoutthe financing period rather than just at the end of the lease term.

8. Tracking Total Cost of Ownership

A lease makes things easier in terms of tracking costs relative to revenue produced; whether byproduct line, project, cost center or other indices. To help in this process, many leases will bewritten to include software, services, maintenance, training and other soft costs which areassociated with the equipment itself, to cover all related costs under just one lease payment.

9. Capital Injection without raising debt- Sale & lease back

Most often, a company needs capital to grow. Companies acquire capital by either debt or equityfinancing or both. Debt must be paid back and goes on the company balance sheet as a debt.Equity does not need to be paid back, but it comes at the cost of ownership. A leaseback allows thisto happen. A leaseback is an agreement where an asset's seller leases back the asset from thepurchaser. In a leaseback arrangement, the details of the arrangement, such as the lease paymentsand lease duration, are made immediately after the sale of the asset. Essentially, the seller of the assetbecomes the lessee and the purchaser becomes the lessor.

10. We make leasing easier

OK – we couldn’t resist. We make Renting Easier!!

Assets on Lease

Available Options

Why Lease?