Glossary

An agreement that makes an individual legally obligated to repay an associated debt. The associated debt is the loan made to the business the Guarantor is related to

Tangible objects that are owned and considered by the general public as being “personal.” All tangible property that is not classified as real estate.

In Chapter 11 bankruptcy, a plan that outlines how a debtor will pay back creditors over time. In order to move forward with a plan of reorganization, it must be accepted by creditors and confirmed by the court.

A delivery of assets to a creditor as security for some debt or any other obligation.  May include a written agreement and recurring reports such as Borrowing Base Forms.  

A Post-Petition Loan is one that is made after a company files for Bankruptcy. Post-petition borrowings are governed by section 364 of the Bankruptcy Code. 

A Pre-Petition Loan as well as other pre-petition debt, is debt the Company incurred before filing for bankruptcy. It is important to classify debt as pre-petition or post-petition to understand which debts are covered under bankruptcy protection.

Prebilling happens when goods are invoiced without being shipped. In this case, there is no clear title transfer, and therefore should be considered ineligible since title must pass for items to become receivables.

In bankruptcy or Chapter 11, there is a 90 day period prior to the bankruptcy filing known as the "preference period". With few exceptions, a security interest obtained or perfected within this period is void and any payments received by a creditor during the preference period must be returned to the debtor.