(1)The nature of the equipment is not changed. The equipment is still used by the lessee.
(2)The lessor pays the price for equipment assignment in a lump sum. The lessee can get a big cash flow to solve its capital liquidity problem.
(3) The lessee can use the fund received from selling the equipment to invest in a new project, which can help the lessee to catch good investment opportunities.
(4) If the equipment appreciates, the lessee can sell the equipment at the fair value and will get more capital.
(5) The lease term is flexible within the original service years of the equipment upon the negotiation. The lessee can use the rent to adjust the production cost, which will have a better tax saving or postponing result.
(6) After the lessee pays up the contracted rent, the lessee takes back the ownership of the equipment again.