equipment trust certificates


equipment trust certificates
A common type of secured corporate bond. For these bonds, a collateral interest in equipment or machinery provides extra protection for bond holders. In most cases, the equipment that is pledged to secure the bonds is equipment or machinery that is purchased from the proceeds of the bond issue. Typically, a trustee will purchase the equipment, issue the bonds, and lease the equipment to the end user. The end user's lease payments to the trustee are passed to the bond holders in the form of interest and principal. When the bonds are retired, the end user acquires title to the equipment. Airlines, railroads, and shipping companies are the most common issuers. American Banker Glossary
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certificates issued by a trust that is formed to purchase an asset and lease it to a lessee. When the last of the certificates has been repaid, title and ownership of the asset transfers to the lessee. Bloomberg Financial Dictionary

Financial and business terms. 2012.

Look at other dictionaries:

  • Equipment trust certificates — Certificates issued by a trust that was formed to purchase an asset and lease it to a lessee. When the last of the certificates has been repaid, title of ownership of the asset reverts to the lessee. The New York Times Financial Glossary …   Financial and business terms

  • Equipment Trust Certificate — A debt instrument that allows a company to take possession of an asset and pay for it over time. The debt issue is secured by the equipment or physical assets, as the title for the equipment is held in trust for the holders of the issue. When the …   Investment dictionary

  • Equipment trust certificate — An equipment trust certificate (ETC) is a financial security used in aircraft finance, most commonly to take advantage of tax benefits in North America.Peter S. Morrell, Airline Finance (Ashgate, 1997), p. 153.] In a typical ETC transaction, a… …   Wikipedia

  • car trust certificates — car trust certificates, or securities A class of investment securities based upon the conditional sale or hire of railroad cars or locomotives with a reservation of title or lien in the vendor or bailor until the property is paid for. See also… …   Black's law dictionary

  • car trust certificates — car trust certificates, or securities A class of investment securities based upon the conditional sale or hire of railroad cars or locomotives with a reservation of title or lien in the vendor or bailor until the property is paid for. See also… …   Black's law dictionary

  • trust — A legal entity created by a grantor for the benefit of designated beneficiaries under the laws of the state and the valid trust instrument. The trustee holds a fiduciary responsibility to manage the trust s corpus assets and income for the… …   Black's law dictionary

  • Trust Certificate — A bond or debt investment, usually in a public corporation, that is backed by other assets which serve a purpose similar to collateral. If the company experiences difficulty making payments, the assets may be seized or sold to help specific trust …   Investment dictionary

  • Pass-Through Certificates — (PTCs) are instruments that evidence the ownership of two or more Equipment Trust Certificates. In other words, Equipment Trust Certificates may be bundled into a pass through structure as a means of diversifying the asset pool and/or increasing… …   Wikipedia

  • car trust securities — car trust certificates, or securities A class of investment securities based upon the conditional sale or hire of railroad cars or locomotives with a reservation of title or lien in the vendor or bailor until the property is paid for. See also… …   Black's law dictionary

  • car trust securities — car trust certificates, or securities A class of investment securities based upon the conditional sale or hire of railroad cars or locomotives with a reservation of title or lien in the vendor or bailor until the property is paid for. See also… …   Black's law dictionary


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