The working relationship between a financing source and a vendor to provide financing to stimulate the vendor’s sales. The financing source offers leases or conditional sales contracts to the vendor’s customers. The vendor leasing firm substitutes as the captive finance company of a manufacturers or distributor through the extension of leasing to customers, provisions for credit checking, and performance of collections and operational administration. Also known as lease asset servicing or vendor programs. (U.S. Equipment Leasing Association)

The replacement of an asset with a similar but more serviceable asset, generally in an attempt to forestall or correct obsolescence. (Leasing in Canada [Third Edition], Ralph Selby, FCA, Butterworths, 1999)

That portion of the residual value of leased property which is not guaranteed (or is guaranteed by a party related to the lessor). (KPMG LLP)

A bank or trust company that holds title to or a security interest in leased property for the benefit of the lessee, lessor, and/or creditors of the lessor. A leveraged lease often has two trustees: an owner trustee and an indenture trustee. (U.S. Equipment Leasing Association)

One of a variety of agreements designed to simulate a lease. (Leasing in Canada [Third Edition], Ralph Selby, FCA, Butterworths, 1999)

An agreement whereby the lessee has the option, at the end of the primary lease term, to either extend the term of the lease or purchase the asset; should lessees choose to extend the term, they have no purchase option later; the present value of the extended rent usually equals the value of the option price. (Leasing in Canada [Third Edition], Ralph Selby, FCA, Butterworths, 1999)

Essentially, depreciable property leased by a lessor to a lessee for a term of more than one year. Leasing having a fair value of $25,000 or less per lease are excluded and it does not include intangible property, including systems’ software, certified feature films or certified productions. (Leasing in Canada[Third Edition], Ralph Selby, FCA, Butterworths, 1999)

Typically, financing transactions under $100,000. (U.S. Equipment Leasing Association)

Payments which are not required to be made during a specified interval (e.g., the first payment may be due in 90 days, which would be a “three-month skip”. (Leasing in Canada [Third Edition], Ralph Selby, FCA, Butterworths, 1999)

A capital lease which at the inception of the lease, the fair value of the leased property is greater or less than its carrying amount resulting in a profit or loss. (KPMG LLP)