The "PUT" Option lease
Otherwise known as "Purchase Upon Termination" equipment leasing.
This end of equipment leasing option establishes a mandatory purchase price, usually expressed as a percentage, e.g. “a 10% Put.”
This is a technique for lowering the equipment leasing payments during the lease term without creating an unknown end-of-lease risk for either the Lessor or the lessee.
The lessee can depreciate the equipment. Up to $500,000 of cost of equipment can be deducted in 1st year