Floating Charge

A security interest over a specific, identified asset that prevents the borrower from dealing with or disposing of the charged asset without the lender's consent. Fixed charges attach to assets such as land, buildings, specific plant and equipment, or identified intellectual property rights.

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 interest that becomes effective only upon the occurrence of a specified trigger event, such as a covenant breach, a decline in borrower creditworthiness, or the drawing down of a revolving credit facility beyond a certain threshold. Springing liens provide lenders with additional collateral protection when needed while allowing borrowers to operate without encumbered assets during normal business conditions.

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.

A public notice filed under the Uniform Commercial Code (primarily UCC-1 financing statements) that establishes a creditor's security interest in a debtor's personal property, including intangible assets such as intellectual property, receivables, and general intangibles. Filing a UCC-1 statement perfects the security interest and establishes priority over subsequent creditors.

A security interest that gives a lender a claim against all of a borrower's assets, both current and future, rather than specific identified collateral. Blanket liens are commonly used in small business lending and working capital facilities where itemising individual assets would be impractical.