Fixed Charge

A form of security interest, primarily used in UK and Commonwealth jurisdictions, that attaches to a class of present and future assets of a company (such as stock, receivables, or general business assets) without preventing the company from dealing with those assets in the ordinary course of business. A floating charge 'crystallises' into a fixed charge upon the occurrence of a specified event such as default, appointment of a receiver, or commencement of winding up.

A security interest granted by a borrower over its intellectual property assets — including patents, trademarks, copyrights, and trade secrets — as collateral for a loan or other financial obligation. IP charges must typically be registered at both the relevant IP registry (such as the UK Intellectual Property Office or USPTO) and the general security interests registry (Companies House, UCC, or PPSA).

A charge applied in the multi-period excess earnings method to account for the fair return attributable to other assets that contribute to the cash flows being valued. Contributory asset charges ensure that the residual earnings attributed to the subject intangible asset are not overstated by stripping out returns earned by tangible assets, working capital, and other identified intangibles.

Debt that holds the highest priority claim on specified collateral in the event of default or liquidation, ranking ahead of unsecured and subordinated obligations. Senior secured lenders benefit from security interests over identified assets such as property, equipment, receivables, or intellectual property.

A security document commonly used in UK lending that creates a combination of fixed and floating charges over all or substantially all of a company's assets in favour of a lender. A debenture typically grants fixed charges over specific high-value assets (property, key IP) and a floating charge over the company's remaining assets and undertaking.

Debt that ranks below senior obligations in priority of repayment in the event of the borrower's liquidation or default. Subordinated debt holders are repaid only after senior secured and senior unsecured creditors have been satisfied in full.

A loan with a specified repayment schedule and maturity date, drawn in full at inception (or in agreed instalments) and repaid through regular principal and interest payments over its term. Term loans may be amortising (with regular principal repayments) or bullet (with principal repaid in full at maturity).

A form of debt financing available to venture-backed startups that supplements equity financing without requiring the dilution of additional equity rounds. Venture debt is typically structured as term loans with warrants giving the lender the right to purchase equity, and is used to extend runway, finance equipment, or bridge between funding rounds.