The Editor | 
02 28th, 2010|
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“Mammoth Market Opportunity for Sparta’s Programs”
Investment Highlights
- Limited Competition. SCRO is the ONLY Financial services company in the U.S. solely dedicated to the Powersports industry.
- Large Market. New U.S. motorcycle retail sales totaled $10.7 billion in 2006. An estimated 1.19M new motorcycles were sold in the U.S. in 2006. Motorcycle registrations accounted for 2.6% of all motor vehicles registered for use on public roads in the U.S. in 2005.
- Large Dealer Base. 2,100+ dealer base in 37 States, representing 20% of the target market.
- Big Relationships. Recently formed relationships, including, the largest online auto auction site; eLoan; and, N.A.D.A., resulting in substantial new loan applications.
- Customer Demographic Expansion. Fluctuating fuel costs and increasing environmental concerns are leading to new purchases of motorcycles and scooters for everyday transportation.
- Huge Contract Revenues. Originated Consumer Contracts of $10,800,000 from inception to date; which is projected to be at $20M in fiscal ‘08.
- 15% Market Share. Motorcycle dealers generated 2007 combined annual revenue of $15 billion. Management sees a $2.2 Billion target retail market, Represents the 15% of retail sales not financed by captives, HDFS, GE, etc. Municipal and fleet leasing offers multi-million dollar revenue potential.
‘For the four years ended April 2008, Sparta’s compounded annual growth rate of revenue exceeded 258%. Management has accomplished this in the face of a recessionary economy, tightening credit, housing down turn and an overall decline in discretionary spending.’
Financials & Milestone
SPARTA has revenue of $1.1 million for fiscal year 2008. Revenue increased 27% from 2007 to 2008. Operating income is negative for 2008; however, the trend of operating loss as a percent of sales decreased 45% from 2006 to 2008. Net loss declined 33% from $6 million in 2006 to $4 million in 2008.
- Announced that it has completed its first commercial fleet leasing transaction with a major Harley-Davidson dealer, providing a credit line of $460,000 under its new program.
- Sparta Funding LLC (Wholly owned subsidiary), has entered into a one year, extendable revolving credit agreement with Autobahn Funding Company LLC as lender, and DZ Bank AG Deutsche Zentral-Genossenchaftsbank New York Branch (“DZ Bank”) as Administrative Agent and Liquidity Agent.
- Sparta entered into a committed one year, $25 million expandable revolving credit facility, which requires Sparta to meet certain financial covenants prior to initial drawdown, and may be increased subject to portfolio performance, will enable Sparta to expand its dealer network, increase the variety of eligible asset classes in the powersports market, and enlarge its market share in the powersports sector.
- Developed proprietary iPLUS® software system to process credit decisions in under 60 seconds;
- Built full-service platform, including: Origination, Point-of-Sale Electronic Processing, Billing, Collection, Reporting, etc.
- Accessed Public Markets; - Fully reporting company on NASDAQ Bulletin Board;
- Established Nationwide Municipal and Governmental finance program in January 2007. Company financed Newark New Jersey’s motorcycle police force, and: - Added 76 Jurisdictions in 16 States in its first 14 months; - Initial Municipal customers have renewed and others have expressed interest in renewing.
- Executed the Dairyland Insurance Agreement (5/1/08); - $10.00 per click referral fee; - Estimated Implementation on-line March 2009
- Electronic Transaction Flow from: eLoan (5/23/08), a prominent online auto auction (5/23/08), and N.A.D.A. (5/23/08), resulting in 7,000+ consumer application referrals in May 2008;
- Manufacturer/Distributor Finance Program: Diamo;
- Manufacturer/Distributor Finance Program: Piaggio; - Piaggio manufactures Vespa, Moto Guzzi and Aprilia.
- Company has been approached by multiple powersport Manufacturers seeking consumer finance program;
- As of the 4th Quarter 2008 Sparta has signed in excess of 2,250 dealerships in 37 states, representing over 20% of its target market;
- Originated Consumer Contracts of $10,800,000 from inception to date; - Projected $32M origination in Fiscal ‘10.
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SRCO.OB NEWS REVIEWS:
- Sparta Commercial Hires Top Law Enforcement Expert as Strategic Consultant (January 19, 2010)
- Sparta Commercial Welcomes Three New Cities to Its Municipal Lease Program (January 11, 2010)
Sparta finances and leases the following makes:
American Eagle, Honda, TN’G, Aprilia, Independence, Triumph, Arlen Ness, Iron Eagle, Ultra, Big Dog, Italjet, Ural, BMW, Kawasaki, Vespa, Bourget, Malaguti, Victory, Buell, Moto Guzzi, West Coast, California Custom, Mustang, Choppers, Confederate, MV Agusta, Yamaha,Death Row Norton, DIAMO, Desperado, QLINK, Ducati, Eton, Paramount, Kymco, Orange County, Piaggio, Lambretta, Precision, Thunder, Polaris, Saxon, Fischer, Suzuki, Mountain, Flying Tiger, Swift, Harley Davidson, Titan
Competitive Edge
- Sparta is the only Nationwide Powersports Financial Services Company offering a LEASE;
- Consumer Leasing offers a lower monthly payment;
- Municipal Lease product used as advantageous financing option for budget constrained Government Agencies;
- Commercial Fleet Leasing program used for rental fleet acquisition in Harley-Davidson dealerships and for those Harley-Davidson dealerships that carry Municipal police bikes on their balance sheets
- Proprietary residual model;
- Proprietary iPLUS® credit decisioning and underwriting system;
- Dealer has the ability to sell & deliver bikes 24/7/365;
- Point-of-sale contract completed on site/on time;
- Substantial industry experience;
- Live, personalized customer service provided.
Sparta Commercial Services has Gigantic Multiple Financing Programs!
SPARTA offers outstanding financing products for new or used motorcycles and select scooters: The SPARTA Flex Lease, the SPARTA Purchase Plus Lease, the Sparta Sport Loan and Sparta Municipal Lease…..
| The SRCO Municipal Lease: |
The Sparta Municipal Lease offers low monthly payments allowing Police Department to purchase more motorcycles for less money. It is the most aggressive and advantageous way to acquire new motorcycles in today’s market.
“Everything was perfect; everything happened on schedule. For the first time, leasing was made easy, and as the officer assigned to complete the documentation, as well as ride the motorcycle, it was certainly appreciated… I don’t know of any other leasing company that calls their customers every so often just to see how things are going.”
- Motor Officer Ben Christiano
Township of Bloomfield, NJ Police Department
“I felt that Sparta went above and beyond most reasonable expectations to customize a program that would work for our needs. I was especially impressed with their ability to manage the logistics of transacting a sale that involved four organizations in four separate cities… I guess in the end it comes down to delivery of product. We receved the motorcycles in the time frame we needed and at the financing that we could manage because of Sparta’s work.”
- Lieutenant Brad Franke
City of Logan, UT Police Departmen
SPARTA Municipal Contact
Call or email:
Louis Musher
Commercial Products Manager
Phone: (800) 882-0778 ext-217
Fax: (917) 591-9430
Email: louis@spartacommercial.com
SRCO finances and leases the following makes:
American Eagle, Honda, TN’G, Aprilia, Independence, Triumph, Arlen Ness, Iron Eagle, Ultra, Big Dog, Italjet, Ural, BMW, Kawasaki, Vespa, Bourget, Malaguti, Victory, Buell, Moto Guzzi, West Coast, California Custom, Mustang, Choppers, Confederate, MV Agusta, Yamaha,Death Row Norton, DIAMO, Desperado, QLINK, Ducati, Eton, Paramount, Kymco, Orange County, Piaggio, Lambretta, Precision, Thunder, Polaris, Saxon, Fischer, Suzuki, Mountain, Flying Tiger, Swift, Harley Davidson, Titan
SPARTA currently offers three other outstanding financing products for new or used motorcycles and select scooters: The SPARTA Flex Lease, the SPARTA Purchase Plus Lease and the Sparta Sport Loan.
| SRCO Flex Lease: |
With the SPARTA Flex Lease, your customers will almost always have a lower monthly payment than that of a retail installment sales contract on the same vehicle. Plus, they’ve got 4 options at lease end…which no retail installment sales contract offers:
- They can buy the vehicle for the original residual amount;
- They can re-lease the vehicle for an additional limited period;
- They can upgrade to a new vehicle, or
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They can simply turn in the vehicle and walk away with no further obligation assuming there are no outstanding Lease Agreement obligations, other than the residual.
| SRCO Purchase Plus Lease: |
SPARTA also offers a “Purchase Plus Lease” product that is designed expressly for customers who definitely want to own the vehicle at lease end.
This program normally carries an 11% residual and has an initial term of up to 60 months, making it function similar to a retail installment sales contract. At lease end, the customer can choose whether or not to pay a relatively small agreed upon pre-set and affordable residual balance to complete the purchase of the vehicle.
| SRCO Sport Loan: |
The SPARTA Sport Loan is their traditional retail installment sales contract finance product, but with the same liberal credit criteria that so many dealers want. We developed the SPARTA Sport Loan specifically for those customers who are determined to “own” their vehicle immediately, and because we want our dealer network to have the best choice of financing products from one source…SPARTA.
About Sparta Commercial Services
Sparta Commercial Services is a New York-based, nationwide financial services company dedicated to the powersports industry, offering financing and leasing products to consumers and retail powersports dealers, as well as a variety of commercial products for governmental agencies that require motorcycles and other equipment for law enforcement activities.
Visit SPARTA Commercial Services Inc. (SRCO.OB) for more information at http://www.spartacommercial.com
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