Financing Sources

Lease
Unlike other sign fabricators, National neon carries its own financial paper on its lease contracts. This allows more flexibility in the initial structuring of the lease parameters and management discretion. This also facilitates workout arrangements should financial reversals occur before a lease expires. Moreover, by retaining the paper and directly
supplying service, National Neon is more accountable than those companies which sell their leases to banks or institutional investors whose only concern is ensuring payments are made on time. It is worth checking if your lease contract will be sold or assigned on execution and how service is to be handled.

Purchase
If you purchase the sign from internally generated funds and this doesn’t impact your external financing security or capacity, then there are no extenuating circumstances to complicate matters. However, in many cases, the purchase does impact security and capacity of credit lines available for the primary business and is considered an on-balance-sheet-item.