An account bank is a financial entity where collections and collateral accounts are opened as part of commercial lending transactions. Through a Deposit Account Control Agreement (DACA) with the Administrative Agent, it grants control over these accounts to enforce the terms of the loan agreement.

An administrative agent is a financial institution or entity appointed to administer and oversee certain aspects of a financial agreement or transaction on behalf of all parties involved. In the context of syndicated loans or other complex financial arrangements, the administrative agent serves as a central point of contact and coordination for the borrower and the syndicate of lenders. It ensures that all parties adhere to their respective obligations and that the transaction proceeds according to the agreed-upon terms.

Advance rate refers to the percentage of the value of collateral that a lender is willing to lend. In other words, it represents the portion of the collateral's value that the lender is willing to advance as a loan. For example, if a lender has an advance rate of 85% on a piece of real estate valued at $100,000, they would be willing to lend up to $85,000 against that collateral. Advance rates are an important consideration in secured lending transactions, as they impact the amount of funding available to borrowers and the level of risk assumed by lenders.

An advance request is a formal submission made by a borrower to a lender or financial institution seeking access to additional funds beyond the initial disbursement of a loan or credit facility. Typically, this request includes details such as the desired amount, purpose, and any necessary documentation required by the lender. Once approved, the lender disburses the requested funds, which become part of the borrower's total loan amount, subject to repayment terms outlined in the loan agreement.

Alternative investments encompass a diverse array of financial assets that diverge from conventional categories like equity, income, or cash. Examples of alternative investments include private equity, venture capital, hedge funds, real estate, commodities, and tangible assets.

Receivable assignment refers to the process where a borrower transfers the rights to receive future payments from a customer to another party, typically a lender or a special purpose vehicle (SPV). This transfer involves providing detailed information about the customer and the receivable to the lender or SPV, along with signing legal documents that legally transfer ownership of the receivable.

A backup servicer is a designated entity or company that steps in to manage the loan portfolio if the primary servicer becomes unable to fulfill its obligations. The backup servicer ensures continuity in servicing the loans, including tasks such as collecting payments from borrowers, managing delinquencies, and handling customer inquiries.

In asset-based lending, a borrower uses its assets, such as accounts receivable, inventory, or equipment, as collateral to secure a loan. The borrowing base represents the maximum amount that a borrower can borrow under the terms of the loan agreement, based on the value of the eligible collateral.

A concentration limit restricts the proportion of a borrower's total receivables portfolio that can originate from a single customer category or source. This limit is established to mitigate risk by ensuring that the borrower's revenue stream is not overly reliant on a single source. When the concentration of receivables exceeds this limit, lenders may reduce the amount of credit extended to the borrower to safeguard against potential losses.

Covenants represent the guardrails that debt capital providers set within lending agreements, outlining essential guidelines and conditions for borrowers to secure funding. In essence, they delineate what borrowers must do, or abstain from doing, to ensure continued access to funds

A credit agreement is a legally binding contract between a borrower and a lender that outlines the terms and conditions of a loan or line of credit. It specifies the amount of credit extended, the interest rate, repayment terms, collateral requirements, and any other relevant provisions. They serve to formalize the terms of the lending relationship and provide clarity and protection for both parties involved.

A credit facility offers a borrower access to a predetermined amount of funds on an ongoing basis, rather than receiving the entire loan amount upfront. It is commonly used by businesses to manage cash flow, fund operations, or finance expansion projects.

A Deposit Account Control Agreement (DACA) is a contractual arrangement involving a borrower, a lender, and a bank. This control typically operates within a 'lockbox' framework, requiring the borrower to seek permission from the lender before initiating any fund transfers from the account. DACAs are mandated in asset-backed lending scenarios, involving fintech receivables pledged as collateral to a lender.

A draw request refers to a formal request made by a borrower to draw down funds from a pre-approved loan arrangement. The draw request typically includes details such as the amount requested, the purpose of the funds, and any supporting documentation required by the lender.

Eligibility criteria refer to the specific requirements that dictate which assets can be counted as collateral by the borrowers. Lenders adhere to these criteria outlined in the credit agreement, ensuring that only eligible assets are considered as collateral for the loan. For instance, in the fintech sector, receivables associated with foreign entities may be deemed ineligible for inclusion in the borrowing base.