Leasing and Rental ProgramFor Pion Equipment

Pion Financial Services

“Making Equipment Acquisition Easy”

Financial Services

• Costs too much money

• Not in our budget

• Pre-Revenue, Venture backed etc.

Common Acquisition Obstacles

• Make Fixed Payments for 24-60 months

• Pay as you go with modest initial cash outlay

• Title transfer occurs at inception of lease

• $1 Buyout Option – Lease To Own

• Fast & Easy application and approval process

Capital Lease Solution

• Equipment costs $35,000• Customer needs 100% financing• 36 monthly payments desired• A rate factor of .03170 applies• Monthly payment calculates to:

$35,000 x .03170 = $1,109.50/mo.

• After 36 monthly payments the customer owns equipment

Capital Lease Example

Leasing Rate Factors

When to Sell:

Customer needs equipment but doesn’t have the cash to pay for it at once.

Customer wants to pay for equipment out of future revenue or cost savings that it generates.

Capital Lease Strategy

• Commit to Fixed Payments for 12-36 months

• Payments can be expensed - not part of capital budget

• Ongoing Purchase Option - Apply 70% of prior payments to acquisition AT ANY TIME

• End of Rental Options – Purchase equipment – Return equipment – Renew Rental for additional time period

• Fast & Easy Application and Approval Process

Operating Lease Solutions: Rentals

• Equipment costs $35,000

• 24 month rental desired

• A rate factor of .03940 applies

• Monthly payment calculates to:

$35,000 x .03940 = $1,379.00/mo.

• Customer buys out rental after 4 months:

Purchase Credit = $3,861.20 (4 x $1,379 x 70%)

Buyout Price = $31,138.80 ($35,000 - $3,861.20)

Net Rental Cost = $413.70/mo ($1,379.00 x 30%)

Rental Example: Interim Financing

Rental Rate Factors

When to Sell:

Customer says they have no capital budget available, or is waiting for budget approval.

Customer is credit stressed, pre-revenue or venture backed.

Rental Strategy

Sample Lease Quote – Page 1

Sample Lease Quote – Page 2

• Determine how your customer plans to pay for their equipment.

• If they are unsure of how they will pay or if they express an interest in financing call Pion FS and forward a copy of your quote.

• Pion FS will call them to discuss their needs and prepare and forward a financial quote.

• Pion FS will follow up with the customer and obtain credit information.

Pion Financial Services Quote Procedure

• Customer submits a credit application to Pion FS , indicating the lease option desired.

• Pion FS Credit Committee evaluates and approves customer for a lease (typically within 24 hrs)

• Pion FS sends lease contract documents and invoice for initial lease payment to customer for signature.

• Once Pion FS receives the executed lease contract from customer, an equipment order is placed with Pion.

Lease Application & Origination

• Banks have tightened their credit policies

• Companies that may have qualified in the past are being denied credit

• Customers still need a way to finance your equipment

• Our credit policies remain more flexible than traditional lenders.

• Pion Financial Services is the answer

Current Credit Environment

• IRS Section 179 limits raised to $500,000

• All companies can deduct 50% of all equipment purchased in 2013

• Companies can take advantage of either incentive when they utilize

a capital lease for their purchase

• A customer can make payments for the remainder of 2013 and

deduct 50%-100% of the acquisition cost this year

Section 179 is Back for 2013

Leasing provides financing and tax incentives to help close sales.

Use $1 buyout leases to spread cost over time. Sell monthly payments vs. total cost – avoid sticker shock.

Use Long-Term rentals for low-cost interim financing until capital funds are available. Get the sale now vs. later.

Add Leasing To Your Sales Effort

Pion Financial ServicesLeasing & Rental Programs

Presented on May 24, 2013

Financial Services