Cash Reimbursement

Raise Capital While Maintaining Use of Your Assets

As firms approach their fiscal year end, it is an excellent opportunity to analyze your financial position. A turbulent economic environment ensures that your cash position is an important financial consideration. By demonstrating a strong cash position, it is possible to:

  • Maximize distributions

  • Term out your line of credit balance

  • Avoid bank covenant violations

  • Preserve debt exposure with your primary bank

  • Consolidate capital acquisitions onto one lease

  • Spread the cost of equipment over the life of the asset

For these reasons, it is common to execute a sale/leaseback transaction in the final month of your fiscal year or at the end of a quarter.

 

What is a Sale-And-Leaseback?

In an equipment sale-and-leaseback, you sell your equipment to a lessor, and the lessor reimburses the firm 100% of the original purchase price of your equipment. You continue the use of your equipment and use the cash for:

  • Larger partner distributions

  • Growth initiatives

  • Strategic projects

  • Paying off your line of credit

  • Cash preservation for future economic turbulence

Additionally, with an equipment sale-and-leaseback, today's partners are not paying for the entire cost of equipment used by future partners.

 

How it Works

 
  1. Send your receipts to First American

  2. First American completes a credit review

  3. Receive 100% of the original purchase price of the equipment

 

 

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