In This Section
High Yield Term Loan (1) 
A high yield term loan is a debt product that functions much like mezzanine or subordinated debt, but can have a 1st priority security interest in certain assets like equipment or intangibles.
Hedging
A hedge is an investment to reduce the risk of adverse price movements in an asset. Normally, a hedge consists of taking an offsetting position in a related security, such as a futures contract.
Haircut
In lending, a Haircut generally means the difference between the value of a loan and the value of the collateral securing the loan. More generally it is a term used for a variety of spreads and margins.
Guaranty
Three-party contingent liability agreement under which a third-party or parties (the "Guarantor" or "Guarantors") agree to be directly or collaterally responsible for the obligation (ABL loan) of a first-party (the Borrower) to a second-party (Lender) in case the first-party defaults or fails to fulfill its part of a deal. Guaranties are typically provided by non-borrowers (Parents, Subsidiaries, Individual Owners) in ABL Facilities.
Guaranteed Sale
Arrangement under which a manufacturer or supplier takes back the goods that remain unsold after a specified period. Similar to a consignment sale.
Grower Liens
Liens attached to the assets (typically perishable, ie from a "grower") of the Borrower for which payment has not been made to the vendor.
Gross Profit
Gross profit is a company's total revenue (equivalent to total sales) minus the cost of goods sold. Gross profit is the profit a company makes after deducting the costs associated with making and selling its products, or the costs associated with providing its services.
Gross Margin
Gross margin is a company's total sales revenue minus its cost of goods sold, or COGS, divided by the total sales revenue, expressed as a percentage. The gross margin represents the percent of total sales revenue that the company retains after incurring the direct costs associated with producing the goods and services sold by a company.
Grid Pricing
Pricing for funded amounts that varies based on the Borrower's performance. For ABL transactions the grid can be based on their percentage of facility usage, leverage, FCCR, EBITDA or excess availability levels.
Government Receivable
Accounts Receivable due from the Government. The ability to perfect and collect on these accounts varies based on the type of government entity (local, state or federal government entity); for Federal A/R the ability to obtain an Assignment of Claims is often a requirement to eligibility.
Goodwill
Goodwill is an intangible asset that arises as a result of the acquisition of one company by another for a premium value. The value of a company’s brand name, solid customer base, good customer relations, good employee relations and any patents or proprietary technology represent goodwill.
Going out of Business Sale (GOB)
Any offer to sell to the public or a sale to the public of goods, wares, or merchandise on the implied or direct representation that such sale is in anticipation of the termination of a business at its present location or that the sale is being held other than in the ordinary course of business.
Going Concern
Going concern is an accounting term for a company that has the resources needed to continue to operate indefinitely until a company provides evidence to the contrary, and this term also refers to a company's ability to make enough money to stay afloat or avoid bankruptcy.
GAAP
Generally accepted accounting principles (GAAP) are a common set of accounting principles, standards and procedures that companies must follow when they compile their financial statements. GAAP is a combination of authoritative standards (set by policy boards) and the commonly accepted ways of recording and reporting accounting information.
Functional Obsolescence
A reduction in the usefulness or desirability of an object because of an outdated design feature, usually one that cannot be easily changed. This is particularly important in the valuation of inventory in ABL facilities.
Free On Board (FOB)
The initials FOB stand for either "free on board" or "freight on board." Either way, it has the same definition. When using the term in business, buyers and sellers attach FOB to the beginning of a location to show the point at which freight changes hands from seller to buyer.
Free Cash Flow
A measure of financial performance that shows how much cash a business generates after accounting for capital expenditures, which is a fundamental basis for stock pricing.
Fraudulent Conveyance
In simple terms, a fraudulent conveyance (or fraudulent transfer) is a transfer of property made, or a debt incurred, with the actual intent to defraud creditors (i.e., an actual fraudulent transfer) or by an insolvent company for less than reasonably equivalent value (i.e., a constructively fraudulent transfer).
Fraud Triangle
The fraud triangle describes the three factors that are commonly found in instances of fraud. The three factors of the fraud triangle are opportunity, motivation and rationalization.
Fraud
The meaning and elements of fraud vary by jurisdiction and by the specific type of alleged fraud. However, in general, fraud is the intentional use of deceit, trick or dishonest means to secure an unfair or unlawful gain, or to deprive another of his or her (or its) money, property or legal right.
