Glossary

An agreement entered by two parties, where one party (the lessor) allows the other party (the lessee) to use certain property in return for a periodic payment.

The lender mandated with structuring and underwriting the credit facility, as well as syndicating the deal. The left lead usually serves as an intermediary between the company and all of the participants in the syndicate as well.

When a lender becomes unsatisfied with the relationship that it has with one of it's borrowers, possibly due to financial underperformance, untimely payments, or other financial transgressions.

A letter issued by one bank to another bank that guarantees a correct and timely payment will be made to the recipient bank's client. In the event that the issuing bank's customer can't make the payment, the issuing bank will make the payment.

Important assurances or guarantees to sellers that they will be paid for a large transaction, particularly with international exchanges. It is a document issued by a third party that guarantees payment for goods or services when the seller provides acceptable documentation. Letters of credit are usually issued by banks or other financial institutions, but some creditworthy financial services companies, like insurance companies or mutual funds, might issue letters of credit under certain circumstances. 

The ratio of a company's debt to it's equity. Can also defined as the ratio of a company's debt to its earnings before taxes, interest, depreciation, and amortization (EBITDA).

A leveraged buyout (LBO) is the acquisition of another company using a significant amount of borrowed money to meet the cost of acquisition. The assets of the company being acquired are often used as collateral for the loans, along with the assets of the acquiring company.

A liability is a company's financial debt or obligations that arise during the course of its business operations. Liabilities are settled over time through the transfer of economic benefits including money, goods or services.