Equipment Financing

EBS offers various equipment lease options.

1. FMV Lease - Fair Market Value Lease. With this lease option the equipment can be purchased at the end of the lease terms for the current Fair Market Value. FMV is usually around 15% of the original purchase price. This lease payment is Tax Deductable.

2. 1$ Buyout Lease - This could also be considered a lease to own option. At the end of the lease terms you can purchase the machine for 1$. This lease payment is not Tax Deductable.

3. All Inclusive Lease - FMV and 1$ Buyout leases can be setup as an "All Inclusive Lease". This lease option includes your equipment, service and supplies. Each month a meter reading is collected from the machine and you are billed per square foot. This option is the most common for the following reasons:

• Convenience. Single bill each month for Equipment, Service, Toner and Paper.
• Single point of contact for everything related to your equipment. Hardware Support, Software Support, Supply Orders.
• Flexibility. Service rates can be adjusted as your business changes. You'll never feel locked into a plan your business can no longer support.
• There is no Interest or Lease Factor applied to Service and Supplies.
• There are no additional hidden fees charged to make your lease "All Inclusive". Service and Supplies are built in at the same price you would pay as a separate purchase.
• Most lease companies require the maintenance of their equipment as part of the lease terms and conditions anyway.

Why Lease instead of Purchase or Loan?

Leasing offers numerous advantages over other financing methods:

Tax implications - One of the main benefits of an FMV Lease is that you may be able to fully claim lease payments for tax purposes. In contrast, the IRS considers $1 Buyout Leases little more than installment purchase plans. Although $1 Buyout Leases allow you to spread your payments over time, they are not tax advantaged in the way FMV Leases are.

Balance sheet management. Because an operating lease is not considered a long-term debt or liability, it does not appear as debt on your financial statement, thus making you more attractive to traditional lenders when you need them.

100% financing. With leasing, there is very little money down - perhaps only the first and last month’s payment is due at the time of the lease. Since a lease does not require a down payment, it is equivalent to 100% financing. That means that you will have more money to invest in revenue-generating activities.

Immediate write-off of the dollars spent. Therefore, the equipment does not have to be depreciated over five to seven years.

Flexibility. As your business grows and your needs change, you can add or upgrade at any point during the lease term through add-on or master leases. If you anticipate growth, be sure to negotiate that option when you structure your lease program. You also have the option to include installation, maintenance and other services, if needed.

Customized solutions. A variety of leasing products is available, allowing you to tailor a program to fit your month-to-month or year-to-year cash flow needs. You are able to customize a program to address your needs and requirements - cash flow, budget, transaction structure, cyclical fluctuations, etc. Some leases allow you, for example, to miss one or more payment without a penalty, an important feature for seasonal businesses.

Asset management. A lease provides the use of equipment for specific periods of time at fixed payments. The lessor assumes and manages the risk of equipment ownership.

Upgraded technology. If the nature of your industry demands that you have the latest technology, a short-term operating lease can help you get the equipment and keep your cash. Lease equipment that you expect to depreciate quickly. Your risk of getting caught with obsolete equipment is lower because you can upgrade or add equipment to meet your ever-changing needs.

Speed. Leasing can allow you to respond quickly to new opportunities with minimal documentation and red tape. Most of the time we will approve your application within one hour and you can have your equipment very quickly.

Lower payments than a Loan.

Improved Cash Forecasting. The lessee knows the amount and number of lease payments so they can accurately forecast the cash requirements for equipment.

Flexible end of term options. Return, renew or purchase.

Tax Benefits. Lessors can pass the tax benefits of ownership on to the lessee in the form of lower monthly payments. If you are in the Alternative Minimum Tax Bracket, at true lease will provide you with an attractive tax benefit.

Improved Earnings. Operating lease accounting provides a lower cost than a capital lease in the early years of a lease.

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