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Transcript of 1 © 2005 Cisco Systems, Inc. All rights reserved. Cisco Capital FY06 Cisco Capital Update Federal...
1© 2005 Cisco Systems, Inc. All rights reserved.Cisco Capital FY06
Cisco Capital Update
Federal Leasing
COMSTOR teams with Cisco Capital for Federal Leasing
Program Overview
Mike Mankin, Federal Leasing Manager
222© 2005 Cisco Systems, Inc. All rights reserved.
Cisco Capital
• Wholly-owned Cisco subsidiary since 1996
• Leader in Cisco Systems end-to-end financial services• Alignment of economic objectives
$4.0B+ in assets
$1.5 B WW Lease Volume (Over $1B US)
$4.9 B WW Channel Financing
$100m WW Remarketed Equipment
• Global market presence with coverage in over 40 countries
• Alignment with technology innovation (Market Residual Value)
• Payment structures flexibility
• Enable larger business solutions
• Integrated element in Cisco’s business strategy
• Dedicated programs to the Public Sector Market (Federal, State & Local)Over $300M in Federal Leases active
• Wholly-owned Cisco subsidiary since 1996
• Leader in Cisco Systems end-to-end financial services• Alignment of economic objectives
$4.0B+ in assets
$1.5 B WW Lease Volume (Over $1B US)
$4.9 B WW Channel Financing
$100m WW Remarketed Equipment
• Global market presence with coverage in over 40 countries
• Alignment with technology innovation (Market Residual Value)
• Payment structures flexibility
• Enable larger business solutions
• Integrated element in Cisco’s business strategy
• Dedicated programs to the Public Sector Market (Federal, State & Local)Over $300M in Federal Leases active
333© 2005 Cisco Systems, Inc. All rights reserved.
To deliver Cisco’s Customers, partners and resellers preferred access to attractive and flexible financing
solutions designed to enable acquisition of technologies while help maximize company's profitability in the
adoption and distribution of business critical solutions
Our Vision
444© 2005 Cisco Systems, Inc. All rights reserved.
Offerings at a Glance
For ChannelsFor Channels For End-CustomerFor End-Customer
Channel Financing• Commercial or Federal
• PO financing
• A/R financing
• GSA Schedules
• Laboratory Lease
• Foundation Advantage Program
• Bid structures support
• Federal Assignment of Payments
• Full Sale Credit for Leases
Channel Financing• Commercial or Federal
• PO financing
• A/R financing
• GSA Schedules
• Laboratory Lease
• Foundation Advantage Program
• Bid structures support
• Federal Assignment of Payments
• Full Sale Credit for Leases
Leasing to the Agencies• Federal Contract Vehicles
• Finance Lease - LTOP
• Operating lease - LWOO
• Step and delayed payments
• Technology Refreshment
• Advance Technology programs and promotions
• Competitive trade in programs
• Customized to Federal budget
• FLEXIBILITY
Leasing to the Agencies• Federal Contract Vehicles
• Finance Lease - LTOP
• Operating lease - LWOO
• Step and delayed payments
• Technology Refreshment
• Advance Technology programs and promotions
• Competitive trade in programs
• Customized to Federal budget
• FLEXIBILITY
555© 2005 Cisco Systems, Inc. All rights reserved.
Aggressive Cisco Capital Lease Programs
• End Customer BenefitsReduced total cost of ownership
Leverage budget dollars
Budget control
Accelerate technology adoption
Provides technology protection
Competitive lease rates
• End Customer OfferingsTraditional lease offerings – LTOP, LWOO
Advanced technology lease programs
Several documentation approaches
GSA Lease documentation
Cisco bundled services
Services only financing
666© 2005 Cisco Systems, Inc. All rights reserved.
Cisco Capital Program Offering
• Conforms to current FY2005 GSA Leasing T&Cs
Term length: 13 – 60 month terms
Available to all Cisco prime contractors
• Size: $100,000 to $100M
T&C’s: SIN 132-3
• Contract Vehicles – GSA Schedule or almost any BOA
• Protection: Termination for Convenience and Termination for Non Availability of Annual Funding is included
• Flexibility: Technology Refreshment / Upgrades / Purchase available anytime
• Flexibility: Bundle Services and non Cisco equipment
• 4 End of Lease Options - Purchase; or Renewal; or upgrade by Technology Refreshment; or Terminate/ Return of equipment
• Cisco Foundation Advantage Program applies for Federal
• Sale Credit to the Federal AM and the Reseller for Leases
777© 2005 Cisco Systems, Inc. All rights reserved.
The 2 Federal payment strategies:
1. Lease to Ownership Plan “LTOP”
Installment & Services Purchase Plan – Uses Capital funds
Purchase Title passes upon final payment
Multi Year Maintenance Plans
2. Lease With Option to Own “LWOO”
All variations - Operating Lease with option to own - Lease payments with fixed purchase option buyout, Step Lease, Buyout anytime at Fair Market Value (FMV).
Uses Operating and Maintenance (O&M) funds
End of Term Options – Return, Renew, Buyout, Tech Refresh
Technology Refresh Upgrade before or at end of term
888© 2005 Cisco Systems, Inc. All rights reserved.
Capital vs. Operating Lease
36 72 months
Purchase Dollars$1,000,000 $1,000,000
LTOP vs. LWOO
$Savings
$Savings
LTOP
LWOO
999© 2005 Cisco Systems, Inc. All rights reserved.
Active Agency Leases
• DOD
• Homeland Security
• Executive Departments
• Veterans Administration
• Other Civilian Agencies
• Defense Information Systems Agency (5 deals), DITCO, Army Core of Engineers (3), Army Ft Belvoir, Air Force ACC, USAFE, PACAF, NAVY NMCI, NAVY Office of Naval Research, DLA, National Guard
• FEMA, Inspector General, Nuclear Regulatory Commission, Department of Energy Laboratories, Coast Guard
• US Senate, GAO (3 deals)
• VA deals - VA VISNs – 3, 7, 8, 9, 10, 12, 14, 16, 17, 21, 22, 23
• Center for Disease Control, Department of Treasury (IRS), GSA, Federal Reserve System (11 deals), Bureau of Reclamation, Department of Agriculture, NASA, NIH, SEC, Smithsonian, Job Corps, Customs
Organization Departments and Agencies
101010© 2005 Cisco Systems, Inc. All rights reserved.
LTOP Example – GSA Headquarters
GSA Purchase price = $3,333,541 Intent to Own but not enough Money to PurchaseWill consider LTOP step payment structure1st annual payment = $ 447,000 delayed 3 Months to
July 2nd, 3rd Annual Pmt = $ 1,610,000Title passes upon receipt of final paymentContract Vehicle – GSA Schedule
111111© 2005 Cisco Systems, Inc. All rights reserved.
LWOO Example – DOD
Purchase price = $ 3,103,980Customer has no Capital money but has O&M Vision for Technology Refreshment not ownershipWill consider LWOO and step payment structure41 Month Term with minimal down payment plus 3 payments in future Fiscal
Years1st Annual payment $ 200,000Subject to Annual appropriations renewal2nd, 3rd, 4th Annual pmt $ 977,256At 41 months – Renew the lease at reduced price or Purchase or Tech
Refresh upgrade or return with out further obligationContract Vehicle – DITCO - GSA Schedule
121212© 2005 Cisco Systems, Inc. All rights reserved.
Channel Reimbursement Example – LTOP
GSA Purchase price = $3,333,541 1st annual payment = $ 447,000 delayed 3 Months to
July 2nd, 3rd Annual Pmt = $ 1,610,000Title passes upon receipt of final paymentContract Vehicle – GSA ScheduleSell at 7.0% vs Buy 6.0% rate Program margin to Partner = $30,123
131313© 2005 Cisco Systems, Inc. All rights reserved.
Cisco Capital Update for FY 2006
• FY 06 Federal - One Team, One Goal
Solves the Budget issue – Spread out the payments in multiple years
LTOP/LWOO - GSA or customized Terms and Conditions through KeyBank – Key Government Finance
Cisco Capital partners through COMSTOR
New Cisco Capital Products
Channel Reimbursement Program with SI’s
2 – Tier Financing capability, Distributors, Alaska Native Corps’s or 8(a)
0% Financing on some SW – CSA - Cisco Security Agent
Foundation Advantage Program with Residuals from Cisco Capital for Operating Leases (LWOO)
Cisco Capital commercial MLA with Federal Rider to meet Federal Termination protections
Multi Year SMARTnet programs
Cisco Lab Lease – 24 month term, 1% of list per month HW,
1.5% of list for SMARTnet. [email protected]
Foundation Advantage Programs – Non Cisco Trade Ins
How to Engage – COMSTOR – David Ambrose – 703-345-5195
Cisco Capital for Federal – Mike Mankin 703-484-5133 for leasing Proposals