Lease Financing Options

True (Tax) Lease Financing

In this option, ATEL remains the legal owner of the equipment and claims tax benefits like depreciation and interest expenses. The lessee treats lease payments as a business expense. At the end of the lease, the lessee may:

• Purchase the equipment at its fair market value
• Renew the lease, or
• Return the equipment with no further obligations

Operating Lease Financing

An operating lease has a shorter term than the equipment’s useful life. It meets specific accounting standards (FASB13) and ensures the Net Present Value (NPV) of lease payments is less than 90% of the equipment’s original cost.

• ATEL owns and depreciates the equipment
• The lessee records lease payments as an operating expense

Master Lease Financing

A flexible financing solution that acts like a line of credit. With a Master Lease Agreement:

• Terms are negotiated once upfront
• The lessee can draw funds for equipment purchases over time
• Equipment financing is simplified for growing businesses

Sale-Leaseback Financing

With this option, ATEL purchases existing equipment from the lessee and leases it back. This allows the lessee to:

• Free up cash for working capital or other strategic uses
• Potentially book a financial gain from the sale
• Lease the equipment for a term that fits their needs