Equipment Leasing

Equipment Leasing

We offer cap-ex lease lines of credit that allow businesses to conserve cash flow and match the equipment’s cost to benefit.  Rather than tying up working capital or bank lines of credit, equipment leasing allows businesses to free those up for other day-to-day operations.

Culver Capital Advisors Equipment Lease Finance Offering

Culver Capital Advisors offers Equipment Lease Finance to Growth/Early Stage, Late Stage, and Mature companies. Our unique Lease offerings cover the spectrum of asset classes and Culver has access to the most aggressive and accurate market pricing and product structures.

Rather than using valuable working capital or bank lines of credit on a depreciating asset, equipment leasing allows businesses to conserve cash flow for continued growth and operations and match the equipment’s cost to benefit.

What is Equipment Leasing?
Equipment leasing is a loan in which the lender buys and owns equipment and then rents it to a business at a flat monthly rate for a specified number of months. At the end of the lease, the business may purchase the equipment for its fair market value price, a fixed price (or predetermined percentage amount), continue leasing on revised schedules, lease new equipment, or return the equipment to the Lender.

Equipment Leasing comes in a mix of structures and terms may vary depending on the client’s particular needs and or current financial and credit position.

Types of Lease Facilities:

An Operating Lease is a lease structure typically used to get equipment on a short-term basis. This type of lease is beneficial for businesses who want to keep their leases out of their financial statements. With an operating lease, only the right to use the property is transferred and not the actual ownership of the asset. The lessee is only required to record the operating expense of the property and it does not affect the balance sheet.

An operating lease allows the lessee to enjoy tax deductions due to the depreciation of the asset as well as the interest paid on the lease. However it is treated as an asset and a liability so it must be recorded in the books.

Typical terms of an Operating Lease are 36 months with a Fair Market Value residual. At the end of lease, the borrower has the option to continue leasing, return the equipment, or purchase at the residual amount, typically determined by a third party appraisal.

Operating Leases work well for IT equipment and equipment that depreciates quickly and typically needs to be replaced and or updated within a shorter period of time. The operating lease is also a good structure for companies who are still burning cash and are looking to add additional equity security to the transaction via the residual component.

A Capital Lease is a lease structure of business equipment which represents ownership and is reflected on the company’s balance sheet as an asset. A Capital Lease, in contrast to an Operating Lease, is treated as a purchase from the standpoint of the person who is leasing (lessee) and as a loan from the standpoint of the person who is offering the lease (lessor), for accounting purposes. The Capital Lease usually has a longer term than the Operating Lease with no residual component.

Because they are considered assets, capital leases may be eligible for depreciation.

Typical terms of a Capital Lease are 60 months with a $1.00 buyout. At the end of the lease, the borrower makes the last payment of $1.00 and the loan obligation to the Lender is fulfilled giving the borrower 100% ownership of the equipment.

Capital Leases are preferred by mature companies that are generating positive cash flows and revenues and are purchasing assets that do not depreciate as rapidly as technology equipment does.

Transaction Size: Culver can source lease finance below $100,000.00 and above $25,000,000.00. Variables are determined by the client’s unique needs, credit position, and equipment specifications.

Criteria: The majority of companies qualify for equipment lease finance based on cash position and ability to service the debt as well as the strength of the underlying asset to be financed.

Culver can provide finance vehicles across the spectrum of asset classes including:

  1. IT and Technology Equipment
  2. Laboratory and Testing Equipment
  3. Manufacturing and Production Equipment
  4. Furniture Fixtures and Equipment (FF&E)
  5. Construction Equipment
  6. Software and Soft Costs

Culver works within all industry fields including:

  1. Technology Service Providers
  2. Biotechnology Firms
  3. Pharmaceutical Companies
  4. Hospitality
  5. Manufacturers
  6. Software Companies
  7. Hardware and Component Providers
  8. Medical Device Manufacturers
  9. Construction
  10. Aerospace
  11. Research and Development Labs
  12. Pro Audio and Multimedia Studios
  13. Film, Television, Radio, and  Internet Media