Meet Any Business'
Needs - An art lease agreement is a contract in
which the user (the lessee) pays for the use of the art while the lessor
owns the art. Leasing has become an increasingly popular method of resource
utilization because it offers a number of advantages over more traditional
alternatives, such as cash purchase or bank financing.
Conservation of Capital - The capital conserved,
while leasing art as an operating expense, can be utilized for other capital
expenditures. The average return on capital can range from 10% to 25% AFTER
Conservation of Credit - A lease is not a
loan. Borrowing reduces lines of credit. Leasing is an operating expense
and hence, allows the customer increased borrowing capacity.
Off Balance Sheet Financing - An operating
lease keeps the debt, and the corresponding asset, off the company's balance
sheet. Therefore, borrowing debt covenants are circumvented, financial ratios
are enhanced, and borrowing capacity is increased.
Tax Benefits - An operating lease may allow
100% of the monthly payment to be included as an operating expense. Bank
financing would allow only the interest costs to be included as operating
expenses. Check with your tax advisor to determine how this may LOWER pre-tax
income and REDUCE taxes.
Flexible Financing - Masters Canvas leasing
provides fixed rate financing with specially structured terms to accommodate
the specific needs of the company.
Flexible Lease Structure - Masters Canvas
offers flexible leasing options to meet business' unique needs. These structured
leases include operating and capital leasing plans.
Fair Market Value (Operating Lease) - For
companies uncertain about purchasing, this plan offers various options during
and at the termination of the lease agreement. The plan is particularly
beneficial for companies desiring a small security deposit and a relatively
low monthly payment. At the end of the lease term, the lessee has the option
to extend the term of the lease, return the art, or buy the art at its fair
market value. Masters Canvas offers financing for purchase of the art at
the termination of the lease agreement. An Operating Lease may allow for
the lease payments to be included as operating expenses (in the case of
non-purchase) or for capital costs to be deferred to the end of the lease,
when a decision to retain or change the art can be made.
$1.00 Buy-Out - The recommended plan for
companies fairly certain they wish to purchase the art at the end of the
lease agreement. At the end of the lease term, the art is purchased for
$1.00. (A nominal charge for processing the title transfer may also apply)
10% Security Deposit Plan - This program offers
the lowest monthly payment with a security deposit of 10% (of the price
of the art.) End-of-lease options are available as follows:
The deposit can be applied
to the purchase price of the art;
Extend the term of the lease; or,
The art can be returned and the
Masters Canvas offers financing for balances with purchase options.
10% Purchase Option Plan - This plan offers the lessee a fixed
purchase option at the end of the lease term. End-of-lease options are as
Extend the term of the lease;
Return the art; or,
Buy it at 10% of the original Fair
Masters Canvas offers financing for purchase options.
Why Lease? - Leasing offers fixed regular
payments; provides financing for 100% of the art cost; conserves both working
capital and lines of bank credit; and may offer certain tax advantages.
Who Can Lease? - Any company, organization,
What Is the Process for Leasing Art? - We
review the credit information supplied on the lease application. Upon approval,
Masters Canvas prepares the lease agreement. When the art is delivered,
we begin billing the lessee for the agreed upon lease payment.
Is A Down Payment Required? - A security deposit,
usually equal to one or two months' lease payment, is generally needed.
This differs from a down payment in that the amount is typically much smaller
and it is a deposit which may be applied to the purchase price of the art
at lease-end, or returned if there are no other payments due.
How Are Lease Payments Determined? - The
monthly payment is based on the term of the lease, price of the art, and
the type of leasing plan chosen. The term of a lease may run from 12 to
What Factors Are Used To Determine Credit Worthiness?
- Type of business, length of time in business, financial condition, references
from financial institutions, and Dun & Bradstreet (D&B) or other
credit bureau ratings.
Can the Lease Be Canceled? - No, but art can
traded for other, leased art before the expiration of the initial term.
We also offer a special rate for "buy-out" options during the
term of the lease.