by Jason M. Gordon | Feb 23, 2025 | Commercial Law: Contract, Payments, Security Interests, & Bankruptcy
What is a Preferred Debt? Preferred debt refers to a financial obligation (debt) that carries priority or preference over other debts. As such, preferred debts are paid before regular(or non-preferred) debts. A preferred debt becomes important in instances of payor...
by Jason M. Gordon | Feb 23, 2025 | Commercial Law: Contract, Payments, Security Interests, & Bankruptcy
What is an Accommodation Endorsement? An accommodation endorsement is a written note of acknowledgement that an entity would back another entity for its credit liability. The entity backing the other is more creditworthy. This allows the entity with weaker credit to...
by Jason M. Gordon | Feb 23, 2025 | Commercial Law: Contract, Payments, Security Interests, & Bankruptcy
What is a Letter of Guarantee? A letter of guarantee is used in supplier-buyer relationships. The letter of guarantee is essentially a contract that a supplier receives from the purchaser’s bank to assure payment after supply of goods. The bank guarantees...
by Jason M. Gordon | Feb 23, 2025 | Commercial Law: Contract, Payments, Security Interests, & Bankruptcy
What is a Counterparty? A counterparty refers to the other party in a transaction. In layman terms, a counterparty is either a buyer or a seller, without which a transaction cannot take place. For a buyer who wants to purchase some items, the counterparty will be a...
by Jason M. Gordon | Feb 23, 2025 | Commercial Law: Contract, Payments, Security Interests, & Bankruptcy
What is a Covenant? A covenant in legal and financial terms refers to an agreement or condition as part of an agreement. In a contract, a covenant by a party ensures the other party that it will not take action or prohibits the party from taking certain action. What...
by Jason M. Gordon | Feb 23, 2025 | Commercial Law: Contract, Payments, Security Interests, & Bankruptcy
What is Cash with Order (CWO)?Cash with order, as the name suggests, refers to the transactions that involve the immediate payment of cash to the vendor at the time the customer places the order. As this transaction involves cash in advance approach, both parties...
