Advance Rate
The percentage of eligible collateral value a lender is willing to finance under a facility, subject to its credit policy.
Need the broader terminology?
Use the U3CN Master Glossary or return to the Capital Provider section.
U3 CAPITAL NETWORK GLOSSARY
Capital Provider Glossary
Plain-language terminology for Capital providers and financing relationships. Definitions are designed to support clearer private-market conversations. Technical, legal, tax, engineering and transaction meanings can vary by agreement, reporting standard and jurisdiction.
Amortization
Scheduled repayment of principal over time or the accounting allocation of certain costs, depending on context.
Asset-Based Lending (ABL)
Financing primarily supported by eligible business assets such as receivables, inventory or equipment.
Balloon Payment
A relatively large payment due at or near the end of a financing term after smaller scheduled payments.
Borrowing Base
A calculation used to determine how much financing may be available based on eligible collateral.
Bridge Loan
Short-term financing intended to bridge a timing or capital gap until a planned event, refinancing, sale or longer-term financing.
Capital Provider
An organization or investor that provides debt, structured capital or other financing.
Capital Stack
The combination and priority of equity, debt and other capital used to finance a company, asset or project.
Construction Finance
Financing used to fund eligible development and construction costs for a project or property.
Covenant
A contractual promise or restriction in a financing agreement requiring or limiting specified actions or financial conditions.
Credit Box
The criteria a capital provider uses to determine which financing opportunities fit its mandate.
Debt Service
Required principal and interest payments on borrowed capital.
Debt Service Coverage Ratio (DSCR)
A ratio comparing cash flow available for debt service with required principal and interest payments under a stated methodology.
Equity Capital
Capital contributed in exchange for an ownership interest or equity-like economic participation.
Facility
An agreed financing arrangement under which funds may be advanced subject to its terms.
First Lien
A security interest with first priority against specified collateral, subject to applicable law and documentation.
Interest Coverage Ratio
A ratio comparing an earnings or cash-flow measure with interest expense under a stated methodology.
Leverage
The use or amount of debt in a company's capital structure.
Loan-to-Value (LTV)
A ratio comparing the amount financed with the value of the collateral or asset used in the calculation.
Maturity
The date on which a financing obligation becomes due under its governing agreement.
Mezzanine Capital
Capital positioned between senior debt and common equity in risk and priority, with terms varying by transaction.
Non-Dilutive Capital
Capital structured without issuing additional common equity ownership, although terms may include fees, warrants or other economics.
Personal Guarantee
A contractual commitment by an individual to be responsible for specified obligations of another borrower or entity.
Private Credit
Privately originated or negotiated debt investments outside conventional public bond markets.
Project Finance
Financing structured around a specific project and its assets, contracts, cash flows or sponsors.
Refinancing
Replacing an existing financing obligation with new financing.
Revolver
A revolving credit facility that allows eligible amounts to be borrowed, repaid and borrowed again during its term.
Senior Debt
Debt that ranks ahead of subordinated obligations for repayment, subject to the transaction documents.
Source of Funds
Information describing where transaction or investment funds originate.
Structured Capital
Capital designed with customized combinations of debt, equity-like features, collateral, payment priorities or other negotiated terms.
Subordinated Debt
Debt that ranks behind senior obligations in payment priority.
Underwriting
The process of evaluating an opportunity, borrower, investment, asset or transaction against specified criteria and risks.
Unitranche
A financing structure combining multiple debt risk layers into a single facility or tranche for the borrower.
Use of Funds
What the business intends to accomplish with the requested capital.