Operating Leases

Regal’s standard programs utilize operating leases for maximum tax benefit to you. The operating lease is viewed as a usage or rental agreement. Neither the asset nor the corresponding liability is shown on your balance sheet and the lease is mentioned only in the footnotes of your financial statements. Therefore, the operating lease is often referred to as "off the balance sheet financing".

To qualify as an operating lease under the Financial Accounting Standards Board (FSAB) #13 rule, the transaction CANNOT offer any of the following:

• Automatic ownership transfer of the asset
• A guaranteed or fixed price option
• A term greater than or equal to 75% of the useful life of the asset
• A present value of the minimum lease payments greater than or equal to 90% of the fair market value of the asset