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- An operating lease in which the lessee has the right to buy the leased asset at the end of the lease term for 10% of the original purchase price.[...]
- An operating lease that requires the lessee to purchase the equipment for 10% of its original purchase price, it being an obligation of the lessee rat[...]Back to Top ↑
- 2
Abbreviation for account receivable
Abbreviation for asset-backed security
Horizontal analysis that compares the absolute currency amounts of items over two or more time periods.[...]
A rule invoked by a bankruptcy court during the liquidation of the assets of a business, especially when the business files a bankruptcy petition that[...]
Variation of accelerated amortization
An amortization method that allocates and expenses the cost of an intangible or financial asset in decreasing amounts in each accounting period over t[...]
A depreciation method that allocates and expenses the cost of a tangible fixed asset in decreasing amounts in each succeeding accounting period over t[...]
The act of receiving an asset from its supplier whereby the lessee uses a certificate of acceptance to acknowledge that the asset it received is prope[...]
A current liability arising from the purchase of goods and/or services on open account in the ordinary course of business, the balance on balance shee[...]
1. A current liability arising from the purchase of goods and/or services on open account in the ordinary course of business, the balance on balance s[...]
A current asset arising from the sale of goods and/or the rendering of services on open account in the ordinary course of business, the balance on bal[...]
The periodic allocation of the cost of a tangible asset over its estimated economic life and reduction of the asset’s carrying value in accordance w[...]
A distinct business unit or other organization for which accounting records are kept and financial statements are prepared.[...]
The period of time during which financial transactions and events have occurred, are recognized and for which financial statements are prepared, most [...]
The standards and practices applied in financial reporting, telling accountants what items to measure and when and how to measure them.[...]
A ratio indicating how a company is using its suppliers as a source of working capital: Accounts Payables ÷ Net Sales.[...]
An asset representing a claim to previously unrecorded revenue that has been earned but not yet due for payment as of balance sheet date – until a f[...]
The interest that accumulates on the principal amount of a bond or other debt instrument after the debt’s last interest payment, the amount being ea[...]
An obligation incurred in the current accounting period but not due for payment until after the end of the period, usually payable within the followin[...]
The total amount of economic usefulness that has expired and been expensed (depreciated) since the asset’s acquisition; it is an contra asset accoun[...]
A separate line item in shareholders' equity that reports the accounting entity's cumulative income that has not been reported as part of net income i[...]
Abbreviation for aircraft, crew, maintenance and insurance
An entity that offers to acquire control of another company (target company) by paying cash, shares and/or debt instruments for the acquiree.[...]
A corporate transaction in which one company (acquirer) obtains control (usually more than 50% of the voting rights) of another company (target compan[...]
Any action that subjects an individual or entity to be proceeded against involuntarily as a bankrupt or for which the person could be adjudged bankrup[...]
Any ratio that measures the relationship between a firm’s level of operations, usually stated in terms of sales (turnover), and the assets needed to[...]
The intentional action to defraud creditors.[...]
Any company that becomes a “Borrower” subsequent to the execution of the facility agreement.[...]
An “Additional Borrower” or an “Additional Guarantor”.[...]
An insolvency procedure in which an administrator is appointed to restructure a financially distressed firm in order for it to continue as a going con[...]
An up-front fee the leasing company charges the lessee for lease-related administration costs.[...]
An expense incurred in the administration of the firm as a whole, which include the salaries of top management, general office expenses and legal expe[...]
A licensed insolvency practitioner – individual or entity – appointed by and accountable to the court, tribunal or agency with jurisdiction over i[...]
The amount of credit extended to a borrower in a single drawing, the term generally being used in loan documentation to identify the different portion[...]
A parent or a subsidiary of the parent, which are presented together as one entity in the consolidated financial statements of the parent company.[...]
Abbreviation for available-for-sale
The bank or other financial institution that is responsible for administering a syndicate facility and acting as a conduit for all payments over the t[...]
Variation of lead arranger
Abbreviation for accrued interest
A certificate granted by a national aviation authority (NAA) authorizing an aircraft operator to use aircraft for specified commercial purposes.[...]
Variation of wet lease
Abbreviation for allowance for loan and lease losses
The amount of a facility assigned to each participant lender upon the close of general syndication, marking the final step in syndication.[...]
The date on which participant lenders are notified of allocations, in a manner determined by bookrunner(s), and the syndication closing timetable is c[...]
An asset contra account representing the possibility that some receivables will not be collected during the coming accounting period.[...]
The asset-contra asset reported on the balance sheet showing the accumulated estimated amounts of impaired financial assets that will not be collected[...]
The method of accounting for doubtful accounts that estimates the uncollectibles at the end of the period, based on past experience and forecasts of f[...]
Abbreviation for asset-liability management
The three senior secured term loans – “Facility A”, “Facility B” and “Facility C” – anticipated in LMA template leveraged agreements, [...]
A system for taxing individuals and corporations that effectively prevents taxpayers from reducing their tax below a certain level, where the taxpayer[...]
A change or revision, usually to the wording of a written document, where loan agreement call for either majority or unanimous lender consent.[...]
Variation of amortization
Variation of amortization schedule
Variation of amortized cost
1. The reduction of a limited-life asset’s value as a result of the passage of time or its use in the production of goods and services through the a[...]
A table in a lease agreement that sets forth the leased asset's purchase value, the lease value, the monthly installments, repayment dates, lease fees[...]
The amount at which a financial instrument is measured upon initial recognition, equal to its transaction price minus the principal repayments, plus o[...]
Abbreviation for alternative minimum tax
A fee-based service provided by banks, including cash management, payment and collection services, risk-management services, foreign exchange and M&A [...]
A separate facility in a structured financing that provides additional financing or hedging, including an overdraft facility, a guarantee, bonding, do[...]
A lender or affiliate of the lender that makes an ancillary facility available to the borrower on a bilateral basis, out of the lender's revolving com[...]
1. The annualized nominal rate without intraperiod compounding, equal to the periodic nominal rate times the number of compounding periods for a year.[...]
Abbreviation for air operator certificate
Abbreviation for accounting period
Abbreviation for Asia Pacific Loan Market Association
A combined lease and credit application process in which a lessor reviews and grants credit using the information submitted on leasing applications, a[...]
An up-front fee charged for the processing of a lease application.[...]
The document filed with the competent authority by the debtor, creditors or a government authority to initiate insolvency proceedings.[...]
An amount of retained earnings in the balance sheet that is segregated for a specific purpose and reported separately to inform shareholders of the am[...]
Abbreviation for annual percentage rate
An upfront fee paid by a borrower to lead arrangers for originating the financing, structuring the syndicate and distributing the financing facility, [...]
1. An underwriter of a finance transaction, acting alone or as co-underwriter.
2. A largely ceremonial title awarded to a syndicate's participant len[...]
The group of commercial or investment banks that comes together in the primary syndication and commits to provide the funds required by the borrower.[...]
Abbreviation for FASB Accounting Standards Codification
The primary source of guidance issued by the US Financial Accounting Standards Board (FASB) on the accounting for leases by lessors and lessees, which[...]
The leasing accounting standard issued by the US Financial Accounting Standards Board (FASB) and effective as of 15 December 2018 that requires public[...]
A trade association active in the in the Asia Pacific region with the stated mission to increase liquidity, efficiency and transparency in the primary[...]
Any right or physical object that provides an entity with probable future economic benefit (value) expressed in terms of money that has been obtained [...]
An account that changes the carrying value of the asset to which it relates, including accumulated depreciation and allowance account for loan and lea[...]
The creation and issuance of marketable debt securities either through true-sale securitization or synthetic securitization.[...]
A marketable security that is issued by a special purpose vehicle (SPV) that buys financial receivables, such as automotive leases and consumer loans,[...]
The coordinated management of the interest rate, liquidity and market-price risks inherent in a financial institution for the general purpose of earni[...]
The LMA term used for the assignment of rent where property is located in Scotland.[...]
A lease assigned by the lessor (assignor) to a funding source (assignee) in exchange for an upfront cash funds.[...]
The party to whom rights in a contractual arrangement and/or an asset have been transferred and assigned.[...]
The sale of a financing arrangement (e.g., a loan or lease) in which the rights to payments (not any obligations) of the financing are transferred to [...]
1. [US] The transfer of the rights and obligations of the assignor/seller under a credit agreement, such that the assignee/buyer comes into privity of[...]
The document used to assign and transfer an LMA facility.[...]
LSTA documentation generally used for assignments, generally attached to each credit agreement.[...]
LMA distressed documentation that involves an LMA Trade Confirmation, an Assignment Agreement and a Pricing Letter.[...]
LSTA distressed documentation involves a Purchase and Sale Agreement (PSA), an Assignment and Acceptance Agreement (A&A) and a Purchase Price Letter.[...]
The party that transfers and assigns some or all of its rights in a contractual arrangement and/or an asset to another party to secure the funding pro[...]
An entity over which an investor has significant influence, generally through control of more than 20% and less than 50% of the company’s voting rig[...]
A perfected lien, which makes the security interest in property complete and legally enforceable as of the date it is perfected, it encumbering real a[...]
The maximum number of shares of each class of capital stock that a company is legally permitted to issue, as authorized by the appropriate authority i[...]
Variation of authorized capital stock
An injunction that arises upon the filing of a bankruptcy petition that halts actions by creditors, with certain exceptions, to collect debts from a b[...]
The amount of financing (total commitment) that lenders are obligated to make available for borrower drawdown during the facility's availability perio[...]
US GAAP designation of a available-for-sale security.[...]
A nonderivative financial asset that is not classified as a loan receivable, held-to-maturity security or trading security – it is measured at fair [...]
A variant of the receivables turnover ratio that converts it into the number of days takes for a firm to collect its receivables: 365 ÷ Receivables T[...]
The average number of days inventory is held until it is sold: 365 ÷ Inventory Turnover.[...]
- A credit facility to advance funds only when a borrower cannot obtain financing under short-term instruments, such as commercial paper.[...]
- A lease transaction in which a lease funder makes a nonrecourse loan to the lease originator after inception of the lease that is secured by the colla[...]
- A party designated to act as the servicer in a securitization transaction in the event of the original servicer’s failure to perform or insolvency i[...]
A financial statement that reports the financial position of an entity at the end of an accounting period by presenting the major categories and value[...]
The evaluation of the structure of a company’s balance sheet and the nature and value of its assets, liabilities and equity, typically over two or m[...]
The financial condition of a company when it has insufficient assets to pay all its debts in full or its aggregate balance sheet liabilities exceed it[...]
When a firm's total liabilities exceed its total assets, where its net worth is negative.[...]
When a firm’s total assets are greater than its total liabilities, where its net worth is positive.[...]
A lease payment structure that provides for level periodic payments that are relatively low during the lease term and a relatively large final rental [...]
Either a depository financial institution, such as a commercial bank, savings and loan association or credit union, or nondepository financial institu[...]
Variation of information memorandum
A bank or bank affiliate that offers leasing as part of its product mix through its regular lending units, a special leasing unit within the bank, a s[...]
1. The meeting held by lead arrangers with co-underwriters and commonly required for large financings where questions about the deal, tiers (tickets) [...]
An individual or entity that is formally deemed unable to satisfy its financial obligations to creditors and that has been judged legally insolvent th[...]
A nontechnical term for a legal state of insolvency.[...]
The contractual subordination of debt such that the borrower is premitted to make and the junior lender to receive payments as long as no bankruptcy b[...]
The lease of a marine vessel (ship, boat) where the vessel's legal, registered owner (lessor) transfers its possession, use, control to the bareboat c[...]
The lease payment for a bareboat charter of a specified amount, usually per day and payable monthly in advance by the demise charterer to the legal an[...]
The party that takes the place of the legal, registered owner (lessor) of a maritime vessel and becomes responsible for crewing, maintenance, operatio[...]
The contractual right of a lessee to purchase the leased asset at a fixed price that is substantially below its expected fair value when the option be[...]
The The lessee’s contractual right to extend a finance lease beyond its basic lease term for rental payments substantially below the asset’s expec[...]
The reference market rate (e.g., LIBOR or EURIBOR) used by lenders for calculating the interest cost they incur in obtaining funding in the required a[...]
A financial model used in acquisition and project finance, including the written business plan and cashflow projections, upon which the prospective le[...]
The series of recommendations on banking regulation – Basel I, Basel II and Basel III – issued by the Basel Committee on Banking Supervision (BCBS[...]
The noncancellable lease term where a renewal option is found in a finance lease arrangement, during which the lessor expects to recover the asset cos[...]
One hundredth of one percent (0.01%).[...]
1. The possibility that a change in interest rate will cause a change in the yield on different rate-sensitive assets, liabilities and off-balance she[...]
Abbreviation for Basel Accords
Abbreviation for Bureau of Economic Analysis
A financing arrangement by which the arranging bank agrees to use its “best efforts” or “commercially reasonable efforts” to market and place [...]
A bank bidding strategy without fear of losing, if a deal appears less favorable for the bank but it wants to protect its reputation with the client; [...]
An aggressive bank bidding strategy with the objective to win the lead mandate, if a deal appears potentially attractive.[...]
The separation of a body into two parts, such as the separation of a derivative from its host hybrid security and accounting for both the host and the[...]
Referring to a relatively low-volume, high-value assets, costing in excess of $500,000 according to DBRS and Fitch and more than $5mn according to ELF[...]
Equipment that costs in excess of $500,000 according to DBRS and Fitch and more than $5mn according to ELFA, such as aircraft, ships and large industr[...]
The lease financing of low-volume, high-value assets, such as aircraft, ships, telecommunications equipment and large industrial plants, arranged unde[...]
Credit or a term loan provided by a single lender to a borrower, as opposed to a multilateral facility, suitable for the funding requirements that can[...]
A document that evidences the transfer of title to an asset from the seller to the buyer upon payment, subject to the terms of a purchase order or ass[...]
Each hour or part thereof elapsing from the moment when the chocks are removed from the wheels of an aircraft until the chocks are next again returned[...]
The group of persons elected by a firm’s shareholders, usually at an annual meeting, authorized to perform such management functions as setting broa[...]
Abbreviation for board of directors
Any secured or unsecured, interest bearing or discount capital market debt instrument, regardless of its issuer and maturity.[...]
The percentage of the cost of qualifying assets (most types of tangible personal property and acquired computer software) that the IRS allows a busine[...]
The process by which arrangers solicit subscriptions (tickets) and revise terms to ensure successful syndication.[...]
A syndicate lead arranger that manages the syndication process, determines the loan pricing, tiers and titles (brackets) offered, allocation to each l[...]
The issuing of invitations to prospective lenders, communicating information to the banks, informing the borrower and the management group of daily pr[...]
1. The party (individual or organization) that receives funds and bears the direct repayment obligation to repay those funds, as specified in a financ[...]
The borrower and any guarantor, as used in LSTA documentation.[...]
The percentage amount of credit that can be extended against eligible collateral, such that it does not exceed the discounted value that lenders can e[...]
Abbreviation for basis point
Abbreviation for bargain-purchase option
The failure of a contractual party to perform in accordance with the terms and conditions of an agreement.[...]
The first available secondary market price after syndication closing and the deal is completed, reported in percentage points of par.[...]
A clear, simple and objective standard comprised of objective criteria that can be applied to judge a situation and used to resolve ambiguous issues i[...]
Abbreviation for bargain-renewal option
Describing the syndicate when lenders are free to trade their loans in the secondary market without restriction, which occurs after the loan is closed[...]
Structured financing that, similar in design to securitization, allows lessors to borrow against the future cash flow of their funded lease portfolio [...]
The sale of most or all of a firm or selected business lines with a view to preserving going-concern value.[...]
An agency of the US Department of Commerce that is responsible for collecting and publishing economic data, including the national income and product [...]
The requirement that an entity determine whether its business model for financial assets is to either (a) hold the instruments with the intention to r[...]
The accounting concept that considers the personal assets of a firm’s owners to be separate and distinct from the business entity’s assets, it app[...]
The guarantee of a vendor to buy back its leased equipment from the lessor upon lease termination, which reduces the lessor’s resale and residual va[...]
- Variation of cancellable lease
Generally an operating lease (rental) that may be terminated by either the lessee or the lessor without penalty.[...]
The reduction of the whole or any part of a lender's commitment by the borrower, which applies first to the prepayment of drawn term loans.[...]
The amount of capital in relation to risk weighted assets required by regulatory authorities that financial institutions must hold to ensure their abi[...]
Manufactured resources that are used in economic activity to produce goods and services.[...]
capital lease
GAAP
Variation of finance lease
Any tradable debt instrument with a maturity greater than one year, including both notes and bonds.[...]
The total amount of owners’ equity and long-term funded debt invested in a company.[...]
The cash flow ratio that measures the relationship between a firm's cash-generating ability and its capital expenditures (CapEx), a ratio greater than[...]
Variation of capitalization of earnings
The transfer of retained earnings to paid-in capital accounts, where it is capitalized – often achieved by means of stock dividends.[...]
The cost of the funds (interest) used to finance self-constructed long-term assets, which results in an increase in the total amount of fixed assets a[...]
The recognition of the total interest incurred by the lessor on progress payments made to a manufacturer or constructor until the asset’s delivery b[...]
A division, subsidiary or joint venture established with a leasing company by a vendor (manufacturer or dealer) with the primary purpose of providing [...]
The amount at which an asset is recognized in the balance sheet after deducting accumulated depreciation, loss allowance or impairment losses.[...]
The original historical cost of an asset less the total amount of depreciation or amortization accumulated on the asset less the total of any asset im[...]
A special exception in loan agreements for disapplying a provision, it being used primarily to exclude specific subsidiaries from being captured by th[...]
All cash on hand (i.e., coins, bank notes, personal checks, bank drafts and cashier’s checks) and all of the firm’s cash on demand deposits with b[...]
The balance sheet and cash flow statement accounts reporting the combined value of all cash and cash equivalents items.[...]
Variation of cash
The cycle from the conversion of cash into inventory, from inventory into accounts receivable, and then back into cash: Days Inventory Outstanding + D[...]
The cash flow from investments, calculated by adding depreciation, amortization and noncash charges to net earnings and subtracting preferred dividend[...]
A short-term, highly liquid investment that is readily convertible to known amounts of cash and so near its maturity (generally, an original maturity [...]
The net cash received in any period, taking into account net operating income, debt service, capital expenses, loan proceeds, sale revenues, and any o[...]
Any ratio that measures the ability of a firm’s cash flow to support its operations.[...]
The anaylsis of cash flow statements to determine the flow of cash into and out of a company and its ability to generate cash and cash equivalents, th[...]
A firm's net cash inflow resulting directly from its regular operations, equaling the firm’s operating revenue less operating expenses plus noncash [...]
The most conservative of the liquidity ratios as it considers only actual cash and cash equivalent balances as available for paying off current liabil[...]
1. The exchange of the cash value difference between the current market price (spot price) of the underlying asset and the settlement price on the fin[...]
The financial condition of a company when it is unable to pay its debts as they mature and come due for payment in the ordinary course of business.[...]
When a company is unable to pay its debts as they mature and come due for payment.[...]
The cash flow ratio that shows the levels of working capital needed to maintain a firm’s operations by comparing the actual cash flows from operatio[...]
The repayment of a maturing loan under a revolving credit facility with the proceeds of a rollover loan without the use of cash, which is usual for re[...]
The damage, destruction or loss of property resulting from an identifiable event that is sudden, unexpected, or unusual, where a "sudden event" is one[...]
Abbreviation for cash conversion cycle
Abbreviation for commercial due diligence
Abbreviation for collateralized debt obligation
Abbreviation for credit default swap
Typically 4-6 months from facility signing by the mandated arrangers, during which lead arrangers must provide certain funding to the borrower in orde[...]
The finance facility provision obliging lead arrangers to provide certain funding to the borrower in order to complete the cash element of an acquisit[...]
The document signed by the lessee acknowledging that the leased asset has been received by the lessee, that the lessee accepts the asset in its receiv[...]
A document certifying appropriate insurance coverage of a leased asset.[...]
Abbreviation for cash flow
An occurrence when the power to govern the financial and operating policies of a company is obtained by one or more other parties, which is generally [...]
A form of bankruptcy under the US Bankruptcy Code that affords the debtor in possession a number of mechanisms to reorganization and restructure its b[...]
A distressed-debt restructuring in which an insolvent firm’s incumbent management remains in control of the company and is responsible for managing [...]
A form of bankruptcy under the US Bankruptcy Code that enables individuals with regular income to develop a plan to repay all or part of their debts t[...]
The bankruptcy process under the US Bankruptcy Code where the bankruptcy trustee gathers and sells (liquidates) the debtor's nonexempt assets and uses[...]
charge
BE
Variation of lien
The reduction of a loan or lease and increase in the allowance for loan and lease losses (ALLL) by the amount of the impairment.[...]
chargee
BE
Variation of secured party
A record that evidences both a monetary obligation and a security interest in specific personal property (goods), in the software or license of softwa[...]
The ... requiring the bidder for a target company in a UK public takeover to prove that it has “certain funds” available to complete the acquisiti[...]
The highest quality of commercial office space or building available for lease.[...]
The second highest quality of office space or buildings available in the commercial real estate lease market.[...]
Suboptimal office space or buildings for rent, usually because the property is relatively dated compared to newer or recently refurbished property or [...]
A self-contained concept within a written contract that can be read and acted on its own, it possibly having a number of subclauses or referencing oth[...]
A motion or petition filed with the appropriate court or authority that seeks the return of assets that were fraudulently transferred.[...]
A provision found in the mandate letter or commitment letter in which the borrower undertakes that neither the borrower nor any borrower group company[...]
A market flex structured such that only specified changes are allowed, such as a margin flex or structure flex.[...]
A lease that does not contain a purchase or renewal option, it requiring the lessor to take possession of the asset at the end of the lease term, ther[...]
The satisfaction of all obligor conditions precedent (CPs) to a financing agreement, as of when financing parties are obligated to make the financing [...]
When all the conditions precedent (CPs) to a finance agreement are satisfied by all obligors, as of when all lenders are obligated (committed) to make[...]
The defined in a loan agreement as the first date after the borrower satisfies the conditions precedent, which is the date of completion of an acquisi[...]
Compensation received by participant lenders in general syndication from underwriters and paid on final allocations for lender due diligence and credi[...]
co-agent
AE
Variation of co-lead arranger
A largely ceremonial title awarded to participant lenders for tickets in order of decreasing size usually during general syndication for relatively la[...]
A syndicate title for a co-underwriter during the sub-underwriting phase of primary syndication, in exchange for a corresponding portion of the underw[...]
A designation used for a participant lender as junior member in general syndication that takes the smallest ticket available.[...]
A lead arranger, joint lead arranger or sub-underwriter who together underwriter the total commitments in a loan syndication.[...]
Abbreviation for cost of goods sold
A specific asset or group of assets (personal or real property) that has been pledged or title to which has been assigned by a debtor (borrower, issue[...]
The analysis of the ability of collateral to support a loan and the collateral proceeds to satisfy any remaining loan obligations.[...]
The transfer of the rights to the rental payments from and a security interest in a leased asset by the asset’s owner and lessor to the lease funder[...]
The internal guidelines that lay down the type of collateral that a lender generally accepts, it including instructions on assessing acceptable collat[...]
Variation of collateral catalog
The value of the collateral underlying the loan relative to the size of the loan, including the ratio of senior secured loan to junior debt in the cap[...]
The cash arising from disposition of collateral and the rights and certain claims against the collateral, first against expenses resulting from the co[...]
A structured pay-through security created by a special purpose vehicle (SPV) that buys an originator’s receivables or other financial assets that se[...]
A guarantee that generally cannot be enforced until the beneficiary of the guarantee has obtained and sought to enforce a judgment against the debtor [...]
The date as of which the effects of insolvency are applicable or the judicial decision to commence insolvency proceedings becomes effective.[...]
A depository financial institution (banks) that accepts deposits of money from the public for the purpose of making business, personal and mortgage lo[...]
A detailed review of a target company's commercial status, focused on the market position of the company’s products and/or services.[...]
Any land or building used for commercial purposes, generally encompassing any real property other than a single-family residence or a residential lot,[...]
The financing that a lender commits to make to a borrower, commonly in some form of confirmation (commitment letter or letter of intent), in which the[...]
The date set by bookrunners for commitments from lenders/investors, subject to legal documentation review, which must be evidenced in writing by eithe[...]
A nonrefundable fee required by the lessor at the time a lessee accepts a commitment in order for the lessor to allocate the funds required for the le[...]
A per annum fee set as a spread over an interbank rate paid by borrowers to lenders on the undrawn (unused) portion of a credit facility on a pro rata[...]
A document prepared by the lessor and presented to the lessee that sets forth the lessor’s commitment to provide the proposed lease, it generally pr[...]
A document in which a prospective lender commits to an arranger to provide a specified amount of a facility’s total commitment in the primary syndic[...]
The collective term for the commitment letter, fee letter and, if applicable, engagement letter, together with the related annexes, schedules and/or e[...]
In commitment letters, the period of time that lenders have committed to make loans available to the borrower.[...]
Security held for the benefit of all lenders, generally by a common security agent/trustee, with all secured creditors having equal claim on the same [...]
The residual equity in a company in that all other financial claims against the firm have priority over this class of equity, it typically entitling i[...]
A financial statement that expresses each line item of the statement as a percentage of a base item of that statement, either of a single company over[...]
Any business entity, typically incorporated. 2. [LMA] (cap) The borrower in LMA investment grade facility documents. 3. [LMA] (cap) The subsidiary of [...]
A parent company and its subsidiaries jointly.[...]
The measurement and comparison of variables in financial statements over two or more reporting periods or of two or more companies for the purpose of [...]
The completion of an acquisition in accordance with the acquisition agreement in LMA-style leveraged acquisition finance documentation.[...]
A type of deferred consideration to the vendor for the sale of the target company in a leveraged acquisition finance transaction the final amount of c[...]
The individual depreciation of each separate component of an asset – commonly big-ticket equipment and real estate – that is significant to the to[...]
An out-of-court restructuring arrangement between a financially distressed debtor and the debtor’s creditors acting collectively to resolve the debt[...]
Any nonderivative financial instrument that is comprised of both liability and equity components, it calling for split accounting under IFRS.[...]
All income and expenses recognized by a company during an accounting period as a result of the changes in equity except for those due to contributions[...]
A special modification to the contractual terms and conditions of a loan granted by the lender to a borrower facing financial difficulties in order to[...]
A loan that a lender would not grant to debtors with similar risk in order to increase the probability of recovering a significant portion of the debt[...]
The purchaser of the asset in a conditional sale transaction, who has the right to possess and use the asset while making the installment payments.[...]
The sale of an asset with the financing manufacturer, bank or finance company withholding title to the asset from the buyer the until all payment for [...]
The seller of an asset in a conditional sale transaction.[...]
The seller of the asset, typically also the asset’s vendor, in a conditional sale transaction, who purchases and finances the asset.[...]
Together, the confidentiality letter and the front running letter accepted by prospective lenders and investors in order to participate in the primary[...]
A document in which a prospective lender or investor undertakes to treat confidentially any information provided to the mandated lead arranger (MLA) b[...]
A lien that is assigned voluntarily, such as a mortgage in real estate.[...]
The accounting convention requiring that when different valuation methods are available, the alternative having the least favorable immediate financia[...]
The accounting constraint requiring the continued uniform¬ity in the accounting methods applied from period to period in the preparation of financial[...]
The combined financial statements of a parent company and all its subsidiaries (statements of financial position, statements of comprehensive income, [...]
The presentation of a parent company and its subsidiaries (affiliates) as one entity in the financial statements of the parent essentially as if the c[...]
The transfer of real or personal property for less than it is worth.[...]
A fraudulent act that occurs when a party transfers property in exchange for less than its reasonably equivalent value, such that the value of the par[...]
An individual who buys a good or service for personal use and not for resale or use in production and manufacturing.[...]
A commodity, such as a motor vehicle, that is purchased and owned by a consumer and used repeatedly or continuously over a prolonged period.[...]
Any good that is used or bought for use primarily for personal, family or household purposes.[...]
An asset whose existence is uncertain.[...]
A potential obligation whose existence is uncertain and dependent on the occurrence or nonoccurrence of one or more future events to determine the amo[...]
A lease payment that is not fixed in amount, it depending instead on the occurrence of some specified event other than simply the passage of time.[...]
An account with a debit balance that reduces the total value of owners' equity, instead of a credit balance as is normal for equity accounts.[...]
A contra account that reduces gross sales to arrive at operating revenue, including sales returns, allowances and discounts.[...]
Variation of rental
A person that enters into a contractual agreement.[...]
An assessment performed at an individual instrument level to determine whether the contractual terms of a financial asset result in cash flows that ar[...]
An arrangement where senior and junior loans are made to the same borrower (common debtor) but the senior creditor and junior creditor agree by contra[...]
A consolidation model under US GAAP in which a reporting entity consolidates any entity in which it has a controlling financial interest.[...]
Any action undertaken by a company that has the potential to affect the nature, make up and/or ownership of the company's equity, including cash and s[...]
A turnaround professional appointed to manage the structuring and implementation of the restructuring of the processes, strategy and operations of a f[...]
The amount of cash or other asset paid or to be paid for the acquisition of a good, service or other future economic benefit or the incurring of a los[...]
The method of accounting for investments where significant influence over another company does not exist, requiring the investor to record the investm[...]
An asset valuation model that carries an asset after its initial recognition at cost less accumulated depreciation/amortization and impairment loss, w[...]
The upfront fees paid to lead arrangers plus the interest margin paid on the loan.[...]
1. In manufacturing, the cost of goods purchased, raw materials, overhead and labor that can be directly related allocated to the production of goods [...]
A promise in an agreement to do certain things or to refrain from doing other things.[...]
Any ratio that measures a firm’s ability to meet its debt obligations out of earning; the higher the ratio, the greater the ability of the firm to m[...]
Financial metrics that measure a company’s ability to service its debt and used to assess default risk, such as (EBITDA to interest, EBITDA to debt [...]
A document prepared by counsel to the lenders that confirms delivery of specified legal documents in satisfaction of certain mechanical closing condit[...]
Abbreviation for current portion of long-term debt
Abbreviation for credit rating agency
Abbreviation for credit rating agency
A consensual distressed-debt restructuring mechanism that enables the support of one class of creditors for a plan of reorganization to be used to mak[...]
Abbreviation for commercial real estate
A bookkeeping entry that affects the right side of all accounts, it decreasing asset and expense accounts and increasing liability, equity and revenue[...]
An agreement to make money available and an off-balance sheet item of the lender, it becoming a loan once drawn down.[...]
Any process used for assessing the credit quality of a counterparty through the analytical study of financial statements and other data, including pay[...]
Any process used for assessing the credit quality of a counterparty (borrower, customer) through the analytical study of financial statements and othe[...]
A form submitted to a prospective lender or lessor that provides credit information on prospective borrower or lessee, respectively – and occasional[...]
The decision process that lenders undertake when evaluating a request for credit, it involving preliminary approval and the analysis of the credit’s[...]
The basic due diligence performed on a prospective or current borrower.[...]
An over-the-counter bilateral contract of a notional amount and specified term in which the seller receives a series of periodic premium payments from[...]
The premium for a credit default swap in the form of periodic payments, usually quarterly, a protection buyer makes to a protection seller, expressed [...]
The premium for a credit default swap in the form of periodic payments, usually quarterly, a protection buyer makes to a protection seller, expressed [...]
A method or instrument used to improve of the credit profile of a structured financial product or transaction in the form of an internal or external c[...]
A party that improves the credit rating of an asset-backed security (ABS) above that of the underlying assets.[...]
An event whose occurrence during the life of a credit default swap gives the protection buyer the right to settle the contract, the three most common [...]
The total amount of credit that a financial institution has extended and risks losing if the debt is not repaid.[...]
A credit model used to determine credit losses that have or will probably arise from a credit portfolio in order to calculate the allowance for loan a[...]
A measure of creditworthiness and the ability of an individual or company to repay debt, especially as assessed and reported by a credit rating agency[...]
An independent company that evaluates and quantifies the credit risk of banks, nonbank corporations and local and national entities as well as their p[...]
An independent company that evaluates and quantifies the credit risk of banks, nonbank corporations and local and national entities as well as their p[...]
The possibility (risk) of financial loss of a creditor (lender, lessor, supplier) arising from the failure of a debtor (borrower, lessee, customer) to[...]
The possibility (risk) of financial loss of a creditor (lender, lessor, supplier) arising from the failure of a debtor (borrower, lessee, customer) to[...]
The management of the overall credit risk of a financial institution consistent with its risk appetite, policies and business objectives.[...]
The management of the overall credit risk of a financial institution consistent with its risk appetite, policies and business objectives, it covering [...]
The process of determining the creditworthiness and forecasting future performance of existing or prospective consumer and SME borrowers or lessees th[...]
A largely statistical regression model that quantifies and shows the degree of the probability of the default of a credit applicant on a credit transa[...]
Financial metrics, such as leverage ratio, interest coverage and collateral coverage.[...]
A method of financing real estate usually structured as nonrecourse debt whereby a landlord obtains financing of rental property secured by assignment[...]
The rate used to calculate the effective interest rate (EIR) for the initial recognition of purchase credit-impaired assets, but not included in the l[...]
An individual, firm, government, company or other legal person that is owed by another party money or some other obligation to perform and that arises[...]
creditor
BE
Variation of account payable
Abbreviation for credit risk management
Abbreviation for credit risk management
Abbreviation for corporate restructuring officer
A guarantee of a subsidiary company's debt by another subsidiary (affiliate-to-affiliate).[...]
Abbreviation for credit scoring system
Abbreviation for credit tenant lease
The accounting period covered by the latest income statement, which corresponds with the period from the previous balance sheet date to the current ba[...]
Cash and other asset that in the normal course of business is expected to be consumed or converted into cash within one year of the balance sheet date[...]
The impairment loss model for the recognition and measurement of the allowance for loan and lease losses (ALLL) requiring an entity to estimate the ex[...]
An obligation that is due for settlement within 12 months from the balance sheet date or in the normal course of the entity’s operating cycle, which[...]
A current liability and balance sheet account showing the aggregate principal amount of a firm’s total long-term debt (e.g., term loans, bonds and n[...]
A liquidity that measures a firm’s ability to pay its current debts out of total current assets:
Current Assets ÷ Current Liabilities.[...]
A credit scoring system that typically utilizes both credit bureau data and other data from a credit application and is developed by the creditor (len[...]
- Abbreviation for delivery and acceptance
An aircraft lease where the asset owner provides the aircraft and its maintenance and insurance to the aircraft operator, but without cabin crew.[...]
Abbreviation for debt-asset swap
The date when the lessee accepts an asset as delivered for the purpose under the lease, which is when its lease obligations are fully binding without [...]
The day a bankruptcy is discharged and officially ends.[...]
The number of days it takes a firm to sell its entire inventory: Average inventory ÷ COGS per Day.[...]
The number of days it takes for a firm to pay its own accounts payable: Average Accounts Payable ÷ COGS per Day.[...]
The number of days a firm needs in order to collect on its sales: Average Accounts Receivable ÷ Revenue per Day.[...]
The fourth-largest global credit rating agency (CRA) based in Toronto, Canada, with approximately 3% of global market share.[...]
Abbreviation for depreciation, depletion and amortization
Abbreviation for double-declining-balance method
Abbreviation for debt-debt swap
Where investor trading in the US loan market is usually conducted at the large underwriting banks.[...]
A bookkeeping entry that affects the left side of ledger T-accounts, it increasing asset and expense accounts and decreasing liability, owners’ equi[...]
Any financial liability or obligation incurred through borrowing (e.g., loan) or issuing (e.g., bonds) or trading (e.g., accounts and notes payable).[...]
A third-party institutional investor (bank, insurance company, pension fund) unaffiliated with the lessor or lessee that lends the long-term debt fund[...]
The amount of nonrecourse secured debt funding provided by debt participants (lenders) in a leveraged lease comprising 60% to 80% of the total funding[...]
The leverage ratio that measures the proportion of all tangible assets that are financed with debt: Total Liabilities ÷ (Total Assets − Intangibles[...]
A process by which a company that is facing cash flow problems and financial distress attempts to reduce and renegotiate its delinquent debts in order[...]
A creditor’s cancelling of all or part of the outstanding debt of an individual, company or country, including unpaid accrued interest.[...]
A debtor’s transfer to a creditor of third-party receivables, real estate, or other assets to satisfy a debt, frequently in order to reduce debt by [...]
A debt restructuring by which old debt is novated between the same debtor and creditor, with amended terms and conditions and/or a new principal amoun[...]
A debt restructuring in which a creditor provides new equity capital in the debtor in exchange for cancellation of outstanding debt it is owed, thus i[...]
The leverage ratio that measures the riskiness of a company’s capital structure by relating the amount of capital supplied by the firm’s creditors[...]
An individual, firm, government, company or other legal person that owes to another party money or some other obligation to perform and that arises in[...]
debtor
BE
Variation of account receivable
An entity in United States bankruptcy law who has filed a bankruptcy petition but remains in possession of property upon which a creditor has a lien o[...]
Funding that is offered by banks to distressed firms in a Chapter 11 style-reorganization in order to finance the operations during the restructuring [...]
A breach of contract that would be an event of default if a grace period elapses, a notice of default is given or a determination of default is made.[...]
The actions permitted by a contract and applicable law that a party may take to protect and recover its property interests in the event of default of [...]
The likelihood of a borrower’s being unable to pay interest or principal on time based on the issuer’s financial condition, industry segment and c[...]
The contractual subordination of debt such that the borrower is premitted to make payment to the junior lender as long as no event of default exists u[...]
Deferred payment to a vendor for the sale of the target company in a leveraged acquisition finance transaction, including retention, completion accoun[...]
A liability that represents payment received in advance of the delivery of goods or the rendering of services for which prepayment is made.[...]
Lease payment that is due after a rent-free grace period and used for assets that do not generate revenue or cost savings until after they have been f[...]
Tax due for payment in future years as a result of timing differences when different depreciation methods are used for financial reporting and tax pur[...]
A balance sheet account showing the amount of taxes overpaid or paid in advance and are often created due to taxes paid or carried forward but not yet[...]
A balance sheet liability account showing the estimated amount of taxes on income earned and recognized for accounting purposes (book income) but not [...]
Taxes resulting from timing differences when a firm uses different methods for its financial accounting and tax accounting.[...]
A post-employment benefit plan that creates an obligation of the employer to the company’s employees that is limited to the amount that the employer[...]
A post-employment benefit plan whereby an employer pays fixed contributions into a fund in the form of a separate entity for the benefit of an employe[...]
The legally recognized transfer of possession (receipt) of an asset.[...]
The event in which a lessee agrees that the asset it received is proper and acceptable for the contractual purpose of a lease and that its lease oblig[...]
The exhaustion of a natural resource, such as mineral deposits, standing timber or oil, through mining, cutting, pumping or other extraction, and the [...]
An intermediate bankruptcy-remote special purpose vehicle (SPV) created by a securitization transaction’s sponsor in a two-step securitization that [...]
The periodic allocation of the cost of a tangible asset (property, plant and equipment) other than land and natural resources with the corresponding r[...]
That portion of the historical cost or other cost base of a tangible fixed asset that is charged (expensed) against the earnings and credited to accum[...]
Depreciation, depletion and amortization of tangilbe fixed assets, natural resources and intangible assets, respectively; the noncash expenses used in[...]
The removal all or a part of an asset from an entity's balance sheet when its contractual rights to the cash flows asset expire or all of the asset’[...]
A financial instrument whose value or price is derived from another instrument (underlying asset), such as an option, forward, futures or swap, as opp[...]
Abbreviation for debt-equity swap
Variation of cancellable lease
Abbreviation for direct-financing lease
Abbreviation for days inventory outstanding
A two-party transaction that involves an equipment supplier/vendor (manufacturer, dealer or retailer) and the asset’s user (lessee), whereby the equ[...]
The method of determining net cash from operating activities that shows each major class of gross cash receipts and gross cash payments, it presenting[...]
A finance lease arrangement between a lessee and a lessor that is not the manufacturer or dealer of the leased asset, whereby the lessor acquires the [...]
1. The interest rate at which expected future cash flows are discounted in the process of computing the present value of a financial instrument.2. The[...]
The process of computing present value.[...]
The assignment of the rental stream at the discounted present value of the lease payments and the grant of a security interest in leased equipment to [...]
The termination of a bankruptcy case without either the entry or a denial of discharge.[...]
The process by which the whole or part of a company’s affairs is wound-up and its assets redistributed – the last phase of a liquidation.[...]
A debt restructuring in which a creditor modifies the terms of debt financing to a distressed debtor and, in the process, grants a concession that it [...]
The identification of banks and investors to invite to sub-underwrite the financing in primary syndication and/or to lend to the borrower in general[...]
A current liability that is created when a cash dividend is declared, it reducing retained earnings by the amount of the dividend.[...]
A full-payout lease that contains a bargain purchase option of $1 to buy the leased asset at the end of the lease term.[...]
An accelerated depreciation/amortization method that doubles the percentage of the straight-line method by which the cost of an asset is expense each [...]
The guarantee of a subsidiary’s debt by its parent company (parent-to-subsidiary).[...]
The process of passing finance down the corporate structure of a company group, commonly in acquisition finance from a sponsor to the parent company a[...]
An increase in an underwriting spread.[...]
Abbreviation for days payable outstanding
Abbreviation for discount rate
A term loan with an extended availability period of two to three years and longer, during which it can be drawn down, generally for capital expenditur[...]
The borrower’s making use of a financing facility, it being an advance from the borrower’s perspective.[...]
1. The date specified in a commitment letter on which the commitment will terminate if a particular condition has not been satisfied or, in acquisitio[...]
A leasing arrangement in which the owner of an aircraft transfers to the lessee and aircraft operator possession of the aircraft for a specified perio[...]
Abbreviation for days sales outstanding
1. Any due diligence report. 2. A legal due diligence report prepared for and provided in an acquisition finance transaction.[...]
A formula that expresses a firm's return on equity (ROE) in terms of its net profit margin times its asset turnover times its leverage: (Net Income ÷[...]
- Abbreviation for exposure at default
The termination of a lease before the scheduled end of its contractual lease term.[...]
A charge set at lease inception levied against the lessee in the event of early lease termination to assure recovery of the lessor’s remaining inves[...]
An option giving a lessee the contractual right to buy the leased asset for a fixed amount at one or more points in time prior to the final scheduled [...]
The contractual right of a lessee to terminate a lease and surrender – not purchase – the leased asset upon payment of the balance due, including [...]
A type of deferred consideration to the vendor for the sale of the target company in a leveraged acquisition finance transaction making payment contin[...]
A firm’s earnings calculated by adding interest expense back to pretax income.[...]
A measure of a firm's underlying cash flow and ability to service its debt, computed by adding interest expense, depreciation expense and amortization[...]
Abbreviation for earnings before interest and taxes
Abbreviation for earnings before interest, taxes, depreciation and amortization
Abbreviation for early-buyout option
Abbreviation for expected credit loss
The credit risk of a financial asset has not increased significantly since initial recognition and entities continue to recognize 12-month expected lo[...]
A financial asset is underperforming and has experienced a significant increase in default risk since initial recognition – the entity measures a lo[...]
A debt instrument that is credit impaired and nonperforming – interest income is measured by applying the EIR to the net carrying amount of the inst[...]
Abbreviation for environmental due diligence
Variation of closing date
A technique for calculating and amortizing the cost of a financial instrument by allocating the interest income or expense at a constant periodic rate[...]
A technique for calculating the actual interest rate in a period based on the carrying value of a financial instrument at the beginning of the account[...]
Abbreviation for effective interest method
Abbreviation for expected loss
Abbreviation for expected loss
Abbreviation for equipment leasing company
An electronic document over which a security interest can be granted under Article 9 of the US Unified Commercial Code (UCC).[...]
Abbreviation for Equipment Leasing and Finance Association
Abbreviation for Equipment Leasing & Finance Foundation
The right of the lessee in a noncancellable finance lease to purchase or continue using a leased asset at the end of the lease term as specified in th[...]
A first lease payment comprised of more than one advance lease payment, with the resulting "rental holiday” equaling the amount of the advance payme[...]
A detailed review of the environmental conditions and health and safety issues of a target company or real estate for potential risk of environmental [...]
Abbreviation for end-of-term option
1. Any tangible movable asset (personal property) that is repeatedly or continuously used in economic activity in the production of goods and services[...]
A contractual arrangement whereby one party possesses and uses equipment owned by another party for a specified period of time, in the form of either [...]
The external financing of equipment that is owned by the lessor but possessed and used by the lessee generally for a significant part of the asset’s[...]
A US-based "501c3 non-profit organization dedicated to inspiring thoughtful innovation and contributing to the betterment of the equipment leasing and[...]
A US-based trade association that represents financial services companies and manufacturers in the US equipment finance sector, with the mission to pr[...]
Any financial institution conducting as its principal business activity the leasing of equipment.[...]
The grouping and classification of equipment sales or financing transactions into subgroups based on type of equipment, the cost of the underlying ass[...]
The possession and use of equipment by one party that is owned by another party for a rental period that is usually significantly shorter than the ass[...]
The possession and use of equipment by one party that is owned by another party for a rental period that is generally substantially shorter than the e[...]
A transaction in which the owner of equipment that has significant remaining economic life sells the asset under the agreement to simultaneously lease[...]
The taking out a lease for new equipment by a lessee either at termination of the original lease or prior its termination date, often on favorable ter[...]
Any financial instrument that evidences the legal right of ownership in a company and where all the payments on the instrument are at the discretion o[...]
The method of accounting for investments where significant influence – not control – over another company exists, whereby the investor initially r[...]
A party in a leveraged lease that as owner of the leased asset holds beneficial interest in the asset and has the risk, rewards and full tax benefits [...]
The funding in a leveraged lease that is provided by the equity participants ranging from 20% to 40% of the investment in the leased asset, it equalin[...]
Intra-group funding in acquisition finance provided by the equity sponsor/investors to the parent company of the acquiring company evidenced by loan n[...]
An entity over which an investor has significant influence, generally through control of more than 20% and less than 50% of investee's voting rights, [...]
An estimate of the time a limited-life asset can be expected to produce revenue or of the total number of service units the asset is expected to produ[...]
Abbreviation for early-termination option
A contract that has been fully performed.[...]
The legal requirement of the contractual parties to a transaction to perform all obligations that they have not yet fully performed, whereby failure o[...]
Ownership-type operating cost, such as insurance, maintenance and taxes, incurred for leased asset pertaining to the current period.[...]
The expected impairment of a loan, lease or other financial asset based on changes in its expected credit loss either over 12 months or its lifetime.[...]
A three-stage approach for estimating and measuring the expected credit loss of a financial and its interest revenue based on changes in its expected [...]
The amount that a creditor (lender, lessor) can expect on a credit exposure equal to the exposure less the value of the collateral in the event of def[...]
The amount of a credit exposure that a creditor can expect to lose in the event of default on a credit exposure equal to the exposure less the value o[...]
A credit loss model used to estimate the amount of impairment loss an entity expects and recognizes on its credit exposures from credit events over a [...]
The approach to immediately recognize the impairment loss on a financial asset accounted for at amortized cost or FVTOCI on the basis of expected cred[...]
The payment of cash or other asset to obtain an asset, service or other future economic benefit or to settle a loss.[...]
An amount of money or other asset used up or the incurrence of a liability (or both) in an accounting period in the course of ordinary business activi[...]
The potential financial loss due to the occurrence of an adverse event.[...]
The amount of financial risk that a creditor (bank, leasing company) is exposed to at the moment the debtor goes into default equal to the unamortized[...]
A charge paid by the lessee for the lessor's forgiving a monthly rent in return for the lessee’s commitment to pay it at a later date.[...]
Credit enhancement in a securitization that comes from a third party, such a letter of credit, surety bond, wrapped security, or cash collateral accou[...]
A financial gain or loss that is (i) of material size, (ii) resulting from an event or transaction that is unusual and infrequent in occurrence, and ([...]