Glossary of Terms

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Finance Lease

A finance lease, in a business sense, is typically a full-payout, non-cancellable agreement in which the customer is responsible for maintenance, taxes and insurance. However, the term "finance lease" also refers in Article 2A of the Uniform Commercial Code (UCC) to a special type of "lease" in which the lessor, lessee and the manufacturer have contractual relationships and the lessor at all times, with the lessees acknowledgement, remains a passive investor where the lessee makes most equipment decisions directly with the manufacturer. (Courtesy www.elfaonline.org)

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