Equipment Lease & Asset Management Equipment Lease & Asset Management ProgramProgram

AgendaAgenda

Who is First American ?

The concept of leasing

The agreement with CCCS

Getting started

Who is First Who is First American?American?

First American is ranked in the top 2% out of 4,200+ leasing firms in USA

Currently one of only 17 independents on 2007 Top 100 list

70% of FAEF business comes from repeat customers

85% of FAEF revenues are from IT equipment.

96% of our customers expressed overall satisfaction with FAEF (audited results)

300 education clients

INC Magazine ∙ 2001INC Magazine ∙ 2001#3 Fastest Growing Private Company

Ranked #3 on the Inc. 500 list of the fastest growing private companies in the United States.

INC Magazine ∙ 2002INC Magazine ∙ 2002#104 Fastest Growing Private Company

Ranked #104 on the Inc. 500 list of the fastest growing private companies in the

United States.

Monitor 100 ∙ 2004 - 2007Monitor 100 ∙ 2004 - 2007#17 Independent Leasing Company

Out of more than 4,200 leasing firms, First American’s financial stability and consistency placed it among the 100 largest leasing firms in the nation.

In October 2007, First American’s CEO, William H. Verhelle, was elected to the Chairmanship of the ELFA, the industry’s premier trade organization.

Equipment Leasing & Finance AssociationEquipment Leasing & Finance Association

Our Customers Our Customers Come FirstCome First

The Basics and Benefits The Basics and Benefits of Leasing your of Leasing your

EquipmentEquipment

Why Lease?Why Lease?

A contract in which one party (“Lessor”) conveys the use of an asset to another party (“Lessee”) for a specific period of time at a predetermined rate.

What is an Equipment What is an Equipment Lease?Lease?

There are over 4,200 leasing companies in the U.S. The equipment leasing industry is a $220 Billion industry The Equipment Leasing and Finance Association has found that

80% of American organizations lease some or all of their equipment

Industry Industry NumbersNumbers

Computer hardware and software LAN/WAN hardware and software Network security systems Student notebook programs Data storage systems Telecommunications equipment Videoconferencing systems Point-of-sale systems Athletic, stadium, and fitness

equipment

Video and broadcasting equipment Office, dorm or library furniture Medical and laboratory equipment Document imaging and archival

systems Dining hall equipment Construction services Consulting and implementation

services Prepaid technical support

Types of Equipment & Types of Equipment & Services that can Be Services that can Be

LeasedLeased

Pay cash

Utilize traditional bank financing

Utilize leasing

Possible Ways to Possible Ways to Acquire EquipmentAcquire Equipment

Possible Ways to Possible Ways to Acquire EquipmentAcquire Equipment

Features Types of Financing

CashReduces cost of acquisition to less than 100% of the cost of the equipment

Maximizes cash flow (a financing tool with the lowest possible pmt.)

Fixed rental rate for the term

No fees Simplified account treatment

100% of the payment gets accounted for as an operating expense

Comfortable and convenient

Sometimes less than 100% financing (i.e. down pmt. requirement)

Requires partner guarantees, cross-collateral securitization (i.e. “blanket liens”), and financial covenants

Most assets have a 5-year depreciable life despite having a shorter useful life (P&L “hit”)

No interest expense

Possible Ways to Possible Ways to Acquire EquipmentAcquire Equipment

Features Types of Financing

Cash BankReduces cost of acquisition to less than 100% of the cost of the equipment

Maximizes cash flow (a financing tool with the lowest possible pmt.)

Fixed rental rate for the term

No fees Simplified account treatment

100% of the payment gets accounted for as an operating expense

Comfortable and convenient Sometimes less than 100% financing (i.e. down pmt. requirement) Requires partner guarantees, cross-collateral securitization (i.e. “blanket liens”), and financial covenants Most assets have a 5-year depreciable life despite having a shorter useful life (P&L “hit”) No interest expense

Possible Ways to Possible Ways to Acquire EquipmentAcquire Equipment

Features Types of Financing

Cash Bank LeasingReduces cost of acquisition to less than 100% of the cost of the equipment Maximizes cash flow (a financing tool with the lowest possible pmt.) Fixed rental rate for the term No fees Simplified account treatment 100% of the payment gets accounted for as an operating expense Comfortable and convenient Sometimes less than 100% financing (i.e. down pmt. requirement) Requires partner guarantees, cross-collateral securitization (i.e. “blanket liens”), and financial covenants Most assets have a 5-year depreciable life despite having a shorter useful life (P&L “hit”) No interest expense

Spreads operating expense evenly over the useful life of the asset Provides an additional source of capital Avoids cross-collateral securitization (i.e. “blanket liens”), and

financial covenants Usually won’t affect debt covenants Simplified documentation

Additional Additional Benefits of Benefits of

LeasingLeasing

A structured, systematic way to refresh technology Reduces maintenance Reduces the burden and cost of equipment disposal Online asset management Lessor administration of equipment procurement A lease can finance maintenance and other service contracts

Equipment Leasing – Equipment Leasing – Technology AdvantagesTechnology Advantages

1. True Lease• aka: Fair Market Value Lease, Tax Lease, Operating Lease

• Allows for technology refresh

• Pay for the use of the equipment during its useful life

2. Capital Lease• aka: $1.00 Buyout Lease, Conditional Sale, Finance Lease

• Predictable cost of ownership

• For assets with a longer useful life

Two Basic Types Two Basic Types of Leasesof Leases

Our Business Model

No Fees Lease

Enhanced Services through CCCS Collaboration

Complementary CustomerConnect™ Services

Complementary Liberty Value Recovery™ Services

Consolidated volume purchasing

Benefits to Member Benefits to Member SchoolsSchools

First American administers your lease from beginning to end Consultative approach Unbiased with respect to equipment selections Master Lease approach Single Point of Administrative Contact to interact with all customers:

Gary StomTransaction Manager

Our Business Our Business ModelModel

Eric DeHartCommercial Account Officer

Greg CampbellMarketing Manager

No Fees No Fees LeaseLease

Access to volume discounted and creative financing products

Pre-Negotiated Master Lease

Consistent Project Manager for all schools

Trusted source of lease-financing services

Customized process and lease-financing structures

Enhanced Services through Enhanced Services through CCCS CollaborationCCCS Collaboration

CustomerCCustomerConnect™onnect™

Provides confidential online asset management reporting

Track your leases and leased equipment 24 x 7

Conveniently export reports into other file formats (.doc, .xls, .pdf )

CustomerCCustomerConnect™onnect™

CustomerCCustomerConnect™onnect™

Assets are listed by location and by equipment type to the serial number level. Assets are listed by location and by equipment type to the serial number level. Additional information includes term, payment, billing, structure and termination Additional information includes term, payment, billing, structure and termination date. This information can be exported to Excel or .pdf for additional review.date. This information can be exported to Excel or .pdf for additional review.

Liberty Value Liberty Value Recovery™ ProgramRecovery™ Program

1. Three years of year-end financial statements

2. A current interim financial statement

3. Any available bank and/or trade references

4. Agreed-upon proposal

5. Deposit check

Credit Credit Requirements for a Requirements for a

LeaseLease

1. The customer selects equipment and orders the equipment through its preferred equipment supplier(s)

2. Upon delivery of equipment, the Lessor sends the final lease documentation, including a “Delivery Order and Acceptance Certificate”

3. Upon return of the signed lease documents, payment is sent to the customer’s equipment supplier(s) and payments commence from Lessee.

4. At the end of a true lease, Lessee can continue to lease the equipment for short-term periods, purchase the equipment for its fair market value, or return the equipment

Basic Steps of a Basic Steps of a LeaseLease

Lease Commencement Types: monthly quarterly

Lease Deposit: Lease proposal specifies how the deposit will be applied Lease documentation is consistent on this issue

Fees: None

Commencement Types, Commencement Types, Lease Deposits & FeesLease Deposits & Fees

Tax Indemnification: Tax law change will not impact lease rate

Notice Requirement: Lease will require notice 90 days prior to the end of term

Renewal Periods: 3 month renewal

Tax Indemnification, Notice Tax Indemnification, Notice Requirements & Renewal PeriodsRequirements & Renewal Periods

Customizable Maximize flexibility Additional features available 3 basic options at the end of the term of a true lease:

1. Buy2. Extend3. Return

T&C’s – End of T&C’s – End of Term OptionsTerm Options

Short-term Renewal Periods Selective Return Staggered Return Like-kind Equipment Return (Serial Number Substitution) Technology Exchange Option Equipment Return Location/Requirements Determination of Fair Market Value

T&C’s – Customized End of T&C’s – Customized End of Term OptionsTerm Options

Managing and coordinating vendor progress payments Customized billing/invoicing to meet specific client needs Pack-and-ship logistical services to simply a client’s equipment return Data cleansing services to ensure the security of confidential client

data Online asset management to facilitate simplified lease/asset

management

Additional Services Additional Services OfferedOffered

Computer hardware and software LAN/WAN hardware and software Network security systems Student notebook programs Data storage systems Telecommunications equipment Videoconferencing systems Point-of-sale systems Athletic, stadium, and fitness

equipment

Video and broadcasting equipment Office, dorm or library furniture Medical and laboratory equipment Document imaging and archival

systems Dining hall equipment Construction services Consulting and implementation

services Prepaid technical support

Types of Equipment & Types of Equipment & Services that can Be LeasedServices that can Be Leased

Case Case StudiesStudies

Conway, AR Apple and Gateway PCs

36 month technology refresh

Nashville, TN Cisco networking equipment Highly customized end-of-term

Step-up annual payments

Lynchburg, VA Library and dorm room furniture

Sale-lease-back Capital lease

Getting Getting StartedStarted

Consulting on technology projects

Customized leasing proposals to fit your needs

A great financing solution for your school’s consideration