CERTIFICATE OF PARTICIPATION (COP)
An instrument evidencing a pro rata share in a specific pledged revenue
stream, usually lease payments by the issuer
that are typically subject to annual appropriation. The certificate generally entitles the holder to receive a share, or participation, in the payments from a particular project. The payments are passed through the lessor to the certificate holders. The lessor typically assigns the lease and the payments to a trustee
, which then distributes the payments to the certificate holders. See: ABATEMENT CLAUSE; LEASE-PURCHASE AGREEMENT; NON-APPROPRIATION CLAUSE; MUNICIPAL SECURITIES. Compare: LEASE RENTAL BOND.