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Exchange Bank Misses TARP payment
In the US Treasury auction, they disposed of their investment in 10 of the 12 banks that were selected for the fourth TARP auction. Exchange Bank, Santa Rosa, California, parent of Exchange Bank Leasing, was the only auctioned bank with a missed dividend/interest payment that has not subsequently been repaid, missing one payment in the amount of $585,875, as of June 30, 2012.
Bill Schrader, President, Bruce DeCrona, COO, Greg Jahn, CFO, and Brad Hunter, SVP, of Exchange Bank did not respond as to why the Dividend and Interest payments were not made.
The U.S. Treasury Department stake in Exchange Bank was sold for $39.7 million. The Santa Rosa Press Democrat reported the 43,000 preferred shares of Exchange Bank sold at $875.25 per share, or a discount of 12.5% off their $1,000 face value, and 2,150 shares at $965.10 per share, or a discount of 4.5 percent.
"Despite the $5.4 million discount given to the winning bidders, taxpayers still made money off the deal, said Matt Anderson, spokesman for the Treasury Department. Exchange Bank paid about $7 million in interest since it received TARP money in 2008."
It appears the dividend and other matters are being left for the next Exchange Board meeting.
Not counting the fees, the US Treasury lost about $55.2 million on the $303.7 million in principal amount of TARP securities sold. The $59.2 million in dividend and interest payments offset the loss.
According to SNL Financial, "The Treasury did not dispose of its entire investment in First Western Financial Inc. or First Community Financial Partners Inc., as bid prices did not meet the minimums set by the Treasury. First Western had only 67% of its series C preferred stock auctioned, and the Treasury did not sell any of the bank's series A preferred stock. First Community Financial did not have its series B preferred stock auctioned, and the bank's series C stock sold at a discount of 33.85%, the highest discount of any security auctioned by the Treasury thus far.
"The discount in which the securities were sold ranged from 3.5% to 33.85%, culminating in an overall median discount of 17.31%. Pricing was not as strong as in the previous three auctions, which featured median discounts of 10.0%, 10.7% and 9.4%, respectively."
Macrolease Corporation, Plainview, New York
“I've recently noticed that you are maintaining a list of Lessors who notify clients of lease maturity and residual/renewal amounts due. Please add our name to that list. We have consistently, over forty plus years, "noticed" our clients about residual or renewal options, six months in advance of maturity dates and are proud of our unblemished reputation within and outside of our client portfolio.
“Thanks for maintaining this important list of credible Lessors.”
Daniel W. West
Companies who notify lessee in advance of lease expiration
Marquette removed from
Several readers in the article regarding Mazuma Capital Takes Exception on Being on Evergreen List (1) emailed Leasing News naming other companies utilizing the same practice. Several of the readers are well-known to Leasing News, and are officers of their company. One named Marquette Equipment Finance.
According to Dorran Sampson, Vice-President/Broker Relations:
When the company was bought and became Pacific Western Equipment Finance (a division of Pacific Western Bank) he maintained the same position. It was noted his old company was still on the list, and a request of his "master lease" was made.
"Our docs are the same as when we were with Marquette. Because we’re public now, it is very difficult to get documents released."
I asked him if he could send to a broker wanting to do business with him, "Sorry, can’t forward to you or your brokerage."
A search of PACER, a national index for U.S. district, bankruptcy and appellate courts brought up a number of Marquette cases, and the first one hit pay dirt: Merchants & Farmers Bank, a Mississippi Corporation versus Marquette Equipment Finance and Applied Financial. It was a similar case and while "dismissed with prejudice" (2), it had the arguments regarding the purchase option and a copy of the complete contract with a similar PPR as with Mazuma Capital:
"(g) Lessee's Options at End of Initial Period. At the end of the Initial Period of any Lease, Lessee shall, provided at least one-hundred-eighty (180) days prior written notice is received by Lessor from Lessee via certified mail, do one of the following: (1) purchase the Property for a price to be determined by Lessor and Lessee, (2) extend the Lease for twelve (12) additional months at the rate specified on the respective Schedule, or (3) return the Property to Lessor at Lessee's expense to a destination within the continental United States specified by Lessor and terminate the Schedule; provided, however, that for option (3) to apply, all accrued but unpaid late charges, interest, taxes, penalties, and any and all other sums due and owing under the Schedule must first be paid in full, the provisions of Sections 6(c) and (d) and 7(c) hereof must be specifically complied with, and Lessee must enter into a new Schedule with Lessor to lease Property which replaces the Property listed on the old Schedule. With respect to options (1) and (3), each party shall have the right in its absolute and sole discretion to accept or reject any terms of purchase or of any new Schedule, as applicable. In the event Lessor and Lessee have not agreed to either option (1) or (3) by the end of the Initial Period or if Lessee fails to give written notice of its option via certified mail at least one-hundred-eighty (180) days prior to the termination of the Initial Period, then option (2) shall apply at the end of the Initial Period. At the end of the extension period provided for in option (2) above, the Lease shall continue in effect at the rate specified in the respective Schedule for successive periods of six (6) months each subject to termination at the end of any such successive six-month renewal period by either Lessor or Lessee giving to the other party at least ninety (90) days prior written notice of termination."
The first option is to purchase the equipment for a price to be determined by Lessor and Lessee and requires a certified letter 180 days prior. This sounds like a fair market purchase option, but the “price to be determined” language means that the Lessor can set any price it wants. This option is illusory in my opinion.
The second option is to continue the lease for an additional 12 months, the “Evergreen” period. No notice of this provision is given to the lessee either in advance of signing or prior to exercising this option. Republic Bank purchases these 12 month extensions in advance of their exercise. How would the bank know that the lessee is going to exercise this option, unless everyone knows it is the only practical option for the lessee to exercise? Republic Bank President Boyd Lindquist confirmed in a telephone call that he “buys” these extensions from Mazuma and has for quite some time.
The third option is to return the equipment, but the clause is draped with the condition that the lessee has to re-lease identical equipment for a similar term. It also has 180 day certified letter requirement, and applies to the second option of 12 months, but also has the clause of an automatic six month option. So what is the point of exercising this option? At the end of this re-lease, there would be the same three identical options, so the lessee would be required to re-lease and re-lease. It’s just like Groundhog Day.
Leasing News is working on obtaining information on other companies so named to add to the list, including follow-up on the master lease for Pacific Western Equipment Finance. If you have a copy, please send and will keep your name “off the record.”
(2) Order to Dismiss with Prejudice:
(3) Copy of filing, including contract:
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The Top 50 Restaurant Franchise Brands
Each year QSR magazine ranks the top fifty brands that are setting the pace in the quick-service and fast-casual restaurant industries.
Subway has had the most changes in units, adding 872 locations, followed by Little Caesars at 305 and then Jimmy John's at 199, Five Guys Burgers & Fries at 182, Chipotle Mexican Grill, 150.
The franchises who lost the most units: Quiznos, 334, Starbucks, 310, KFC, 297, Arby's 85, and Sbarro 70.
Why I Became a CLP
Gary Greene, CLP, BPB
I received my CLP Designation in April, 1998 and now proudly tout my CLP credentials on our website and in my email signature. The continuing education, the code of ethics, and the ability to distinguish myself as a Certified Professional in the leasing business; those continue to be bragging points for me as a CLP.
Without a doubt, the knowledge I gained in the certification process and subsequent renewals helps me to provide better service to my clients, but I determined to become a CLP for my own selfish interests: My ability to understand and explain intricacies in transaction structures; to confidently answer challenging questions from clients and referral sources; even my understanding of my own limitations and when to refer a transaction to another CLP with a different area of expertise. These qualities give me an edge – a marketing edge and a personal satisfaction that I’m the best that I can be. I’ve earned the right to set myself apart from other participants in the leasing business, others who have not pursued certification. CLP’s renew that right through continuing education and participation in the CLP code of ethics.
I am a broker member of the National Association of Equipment Leasing Brokers and also qualified for the Best Practices Broker designation. Both of these distinctions give me an opportunity to explain to my clients what makes me more valuable to them in their business finance decisions.
I got my CLP Designation in April, 1998 and now proudly tout my CLP credentials on our website and in my email signature. The continuing education, the code of ethics, and the ability to distinguish myself as a Certified Professional in the leasing business; those continue to be bragging points for me as a CLP.
I entered the equipment leasing business in 1982 after a successful career as a real estate broker and property manager. My approach in the real estate business was to be the most informed broker I could be:
I wanted to know as much about my clients and their objectives as possible, then I would go out and research properties that met their objectives. As I investigated properties, I also wanted to know as much as I could about the properties I was going to present to my client.
My knowledge and my well-informed approach brought me many grateful and loyal clients. Real estate brokerage has requirements for continuing education, and there were lots of classes put on by various practice specialties and associations. I was constantly attending classes and developing my professional abilities. I really liked being on top of my craft.
When I got into the equipment leasing business, I was learning about a variety of aspects of business finance and, WOW! I was really turned on by all the possibilities. My equipment leasing clients came from a wide variety of industries, so I found a great opportunity to learn "a little bit about a lot of things." That broad variety of client types is something that continues to excite me about the leasing business.
Several years after starting Lease $mart, I was invited to attend a conference of the Western Association of Equipment Leasing ((WAEL)--now National Equipment Finance Association)). I looked forward to the many educational sessions that were offered, and the opportunity to rub shoulders with other professionals in our industry. I had been learning from personal experience before joining WAEL, but this gave me a focused and structured forum for me to learn more about my profession and do so in an accelerated manner. At one of those conferences, someone asked me how long I’d been in the business and confirmed that it was more than five years. ‘Good news!’ they said (note: today it is three years). That meant that I was eligible to become a Certified Leasing Professional, and they told me a bit about what was involved for me to become certified, including sitting for and passing what they described as a grueling, difficult, challenging, all-day exam. I said I’d look into it, but the truth is they almost scared me off!
I continued attending WAEL, then when their name changed to United Association of Equipment Leasing, went to the UAEL conferences and I got regular reminders from them – because I was genuinely interested, even if a bit intimidated by the daunting reputation of the CLP exam. At the 1996 UAEL annual conference, I bought The CLP Handbook and . . . and then I procrastinated some more! The UAEL conference was scheduled to be in Tucson and I took that as my incentive to finally sit for the exam. I studied The "CLP Handbook" as well as "The Handbook of Equipment Leasing" by Amembal & Isom. I studied HARD, until I felt comfortable with each of the many different aspects that I knew I’d be tested on. Maybe I studied TOO hard, because when I finally did take the exam in 1998, I found it was easier than I’d feared it would be.
I am a vocal fan of the CLP organization and I encourage serious leasing professionals to obtain their CLP designation. There are multiple safety nets – prep-sessions, resources and mentors – so that applicants can approach the exam with greater confidence than I had in 1998.
Why I became a CLP
Digital boosts NBC Olympics ads to $1 Billion
The 2012 Summer Games may go down in history as the first “social media Olympics.
Some fans are claiming the 2010 Winter Games in Vancouver were the first to be “socialized,” but one look at what’s in store for the 2012 games and its clear: the Olympics have never been seen, heard, or tweeted like this. And NBC, always at the forefront of Olympic coverage, is pushing that envelope with partnerships with Twitter, Facebook, Instagram, YouTube, Google+, Tumblr and it seems, just about every other platform on the web.
More importantly, NBC’s bottom line has been fattened with its push into digital platforms, saying it hit a record $1 billion in ad revenues by last Thursday. That number includes $60 million in digital ads, up 200% from the 2008 Olympics in Beijing. NBCOlympics.com will live-stream more than 3,500 hours of the Olympics and two apps will take the Games uber-mobile. Writing in the Wall Street Journal, Christopher Stewart, put it this way: “In many ways, this summer’s London Olympics will be a monumental experiment for network television in the digital age.”
Of all the social platforms engaging in the Olympics, Twitter is getting the most attention—perhaps because it’s seen as taking the biggest risk. In partnership with NBC, Twitter will create a “news hub” for the games, a move that GigaOm’s Matthew Ingram sees as meaning that the microblogging service is “about to jump into the global media game with both feet.”
Twitter is so much ingrained into the Games, in fact, that the London Eye, the ferris wheel on the banks of the River Thames, has been rigged to light up in concert with how the Twitter community is feeling about the games that day. If tweeps are happy, it will glow yellow. Not so happy and it will turn purple. Slate’s Will Oremus wrote: “If it sounds like an epic MIT student prank crossed with a bizarre corporate social media campaign, that’s because that’s pretty much what it is.”
(The overload in fact had NBC asking fans to turn off their digital devices as it was effected their bandwidth in broadcasting games. Editor)
Build your own app for FREE
The website lets visitors follow a step-by-step template to create a customized app, all in half an hour. By selecting a category, users are prompted with five or six suggested modules they can choose from to design their app, adding and deleting items like videos and pictures as they go.
“You customize the app to have the experience that you want your customers to have, because no one knows the customers better than the businesses themselves,” says Scott Hirsch, founder of appsbar.com.
After customers submit their information, it takes 3–5 days for appsbar.com to create the app, and then an additional 3–5 days to be approved by Google Play. The app is an HTML 5 multiplatform application that can be downloaded and viewed on anything from an Android and iPhone to a Blackberry or even Facebook.
But many small business or franchisees may wonder why they should create an app in the first place.
“Billions of downloads are going on in the app stores, so if you don’t have an application, you’re missing out on millions of potential customers and billions of potential opportunities,” Hirsch says. “And in today’s economy, I don’t think you can afford to miss out on one opportunity.”
Oh, and did we mention it’s free? “Whether you end up with 200 or 20 or two new customers, you have nothing to lose and everything to gain,” Hirsch says.
He also adds that apps are becoming must-have tech-marketing tools for every business and a trend that’s set to stick around for quite some time. “Getting in early is important, because if you don’t have an app, your competition will.”
You can go direct to: appsbar.com
For more information, here is a video:
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Growth Continues to Weaken in July Credit Managers' Index
Grim reality of summer 2012 sets in as sales deteriorate
Columbia, Maryland: —The National Association of Credit Management's CMI fell from 54.5 to 53.4 in July. For the first time in over a year, sales fell below 60, and by a significant degree. The reading of 58.5 is worse than at any point in 2011. The new credit applications index sits at 57.2, a long way from the 61.9 registered in January when expectations were upbeat. There were also declines in dollar collections and amount of credit extended. Altogether, the favorable factor index slid from 60.2 to 58.9, marking the first time it has fallen under 60 since November 2011. It became obvious in May that another spring swoon was underway, and the summer is again becoming an extension of the deterioration.
The unfavorable factor index fell to 49.8 marking the first time since the end of 2010 that this index has been in contraction—below 50, the neutral line separating contraction and expansion. Only two unfavorable factors registered above 50 in July. In March, all six factors were over 50. Rejections of credit applications managed to remain stable and there was a small improvement in accounts placed for collection, but there were more disputes, which slipped deeper into the mid-40s to 47.6. Dollar amount beyond terms also fell, to 47.8, after managing to hit 50.5 in June. Finally, dollar amount of customer deductions slipped a bit and filings for bankruptcy worsened.
“This is a precipitous fall, and it is unlikely that a reversal will be swift,” said Chris Kuehl, PhD, economist for the National Association of Credit Management (NACM). “When the specifics of the decline are examined, it is apparent that the real damage occurred in the volatile service sector.”
The service sector index dropped from 55.3 to 54, the lowest reading since November 2011. It was the sector’s unfavorable factors that caused the CMI to drop. The unfavorable index now teeters on the edge of contraction, slipping from 52.2 to 50.3. All factors fell, and only two remain above 50, whereas, in April, all were above 50. Disputes, dollar amount beyond terms and bankruptcy filings all registered sharp drops.
The manufacturing sector index was not exactly promising, falling from 53.6 to 52.8. Sales fell from 59.1 to 57.2 and haven’t been this low since early 2011. “Much of this fall can be attributable to the slump in export activity as well as in inventory numbers,” said Kuehl. “In January, many companies started to build inventory in anticipation of projected growth. Then the economy stalled, and that inventory became an anchor: material and product that could not be sold or turned into anything useful. Now manufacturers have to clear that inventory before they can get engaged in new production, delaying recovery that much more.” The good news from this period had been fewer issues for the companies that survived the first round of economic downturn. It would appear that the companies applying for credit are the ones that are doing well, and approvals are not generally suspect.
The more worrisome data comes from the manufacturing’s dollar amount beyond terms, which slid to 47.8 from 49.2. “This is a concern. It signals that some customers are struggling to stay current and are perhaps having cash flow issues, and these will likely not dissipate in the immediate future,” said Kuehl.
In prior CMI reports, Kuehl had noted that the economy can survive a stall in growth, provided there is no further deterioration in business conditions. However, Europe’s continuing crisis affects exports, and now billions of dollars have been lost to the U.S. drought. The two sectors that had been pulling more than their own weight were manufacturing and farming. Thus far it is hard to see what impact the drought will have on the greater manufacturing and service economies, but given that the farm sector helped drive manufacturing last year, the sudden drop in demand for machinery isn’t welcome.
About the National Association of Credit Management
NACM, headquartered in Columbia, Maryland, supports more than 15,000 business credit and financial professionals worldwide with premier industry services, tools and information. NACM and its network of affiliated associations are the leading resource for credit and financial management information, education, products and services designed to improve the management of business credit and accounts receivable. NACM’s collective voice has influenced federal legislative policy results concerning commercial business and trade credit to our nation’s policy makers for more than 100 years, and continues to play an active part in legislative issues pertaining to business credit and corporate bankruptcy. Its annual Credit Congress is the largest gathering of credit professionals in the world.
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"Diminutive Dallas is a pint-sized boy with gallons of personality. He is a world-class lap warmer, and will make sure your face is clean, if you let him get close enough. He is light as a feather on the end of a leash. Dallas is about 3 years young, so he is well past puppyhood and all its accompanying behaviors. Dallas' new home can have children 16 years old and older, cats and another small dog. A leisurely walk, a long snuggle- if this is your idea of a perfect way to pass an afternoon, Dallas would like to meet you!"
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