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The more knowledge our customers have, the more they can appreciate the value of our Lifespan approach.

Glossary of Terms

Amortization – Payment of debt in regular, periodic installments of principal and interest.

Basis Point – One percent (1%) of interest divided by one hundred (100).

Collateral – The underlying security for a lease or loan transaction.  For an equipment lease or loan, the collateral is typically the actual equipment financed, which is either owned by or pledged to us.  For a growth capital loan, the collateral is typically all the assets of the customer.

Covenant – A clause in a loan that obligates or restricts the borrower.  Our loans typically do not have any covenants.

Debt Service – See Amortization.

Depreciation – The decrease in value to equipment, assets, or other property.

End of Term Options – After the term of a venture lease expires, your firm typically has the option to purchase the equipment, return the equipment to us, or continue leasing the equipment.  After the term of the venture loan expires, you may make a balloon payment and keep the underlying collateral.

Fair Market Value – The value of an asset as determined in the open market under normal selling conditions.

FASB – Financial Accounting Standards Board, the accounting profession's guideline setting authority.

FAS Statement 13 – The statement issued by the FASB that sets the standard for lease accounting.

Financing Statement – See UCC Statement.

Incumbency Certificate – This document identifies and authorizes respective individuals to execute binding documents on behalf of their company.

Insurance Certificate – For equipment based financing, you are required to obtain risk and casualty insurance for the equipment.  The insurance certificate is proof that you have obtained this insurance.

Interest Rate – The rate of charge for the use of money for a specified period of time.

Interim Rent – The equipment rental due for periods between the date of payment for the equipment and the start date of the lease.

Lease Schedule or Summary Schedule – A document that incorporates all of the terms and conditions of a Master Lease agreement and describes in detail the equipment being financed.

Lease Rate Factor – The periodic rental payment rate that your firm makes to us for the use of the leased assets.  Once the equipment cost has been determined, the actual monthly lease payment can be computed by multiplying the Lease Rate Factor by the equipment's cost.

Lessee – The entity that is using/leasing the equipment from its owner, the lessor (us).

Lessor – The owner of the equipment who receives lease payments from the lessee (you) for use of the leased asset.

Lien – A claim against equipment, assets or other property.

Master Lease – An agreement which allows you to lease currently needed assets and to lease assets in the future over a fixed period of time under the same basic terms and conditions without negotiating a new contract.

Net Lease – A lease where you are responsible for paying all costs related to the leased equipment, such as maintenance, taxes, and insurance, and in addition to the monthly lease payment.  All of our leases are typically net leases.

Prime Rate – A rate determined by the Federal Reserve used to calculate interest rates on loans.

Principal – The remaining balance of a loan excluding any interest.

Promissory Note – An agreement which contains a written promise to repay an amount over a specified time period at a specified rate.

Property Tax – A tax assessed on the value of equipment, assets or other property by county and local governments.

Purchase Lease Back – See Sale Lease Back.

Purchase Option – An option at the end of the lease term, where you may purchase the equipment on lease.

Renewal Option – An option at the end of the lease term, where you may renew your lease for a specific period of time.

Sale Lease Back – An arrangement that allows us to lease equipment that you have already purchased and are using.  We purchase the equipment from your firm and then lease it back to you.

Security Agreement – The legal document that you sign to pledge your firm's interest as collateral for a loan.

Subordination Agreement – An agreement by which a loan is made junior in claim on assets to other debt.

UCC Statement – A notice filed under the Uniform Commercial Code with the appropriate agency in your company's state of incorporation that establishes our security interest in an asset and provides information on liens to interested third parties.

Useful Life – The economic usable life of an asset.

Use Tax – A tax imposed on the use, storage, or consumption of equipment by county and local governments in lieu of sales tax.

Warrants – Securities that entitle the holder to buy a proportionate amount of stock at a specified price for a period of time.