What distinguishes "firm commitments" in underwriting?

Firm commitments in underwriting are characterized by the underwriters purchasing all securities from the issuer with the intention of selling them to investors. This arrangement essentially guarantees that the issuer will receive a predetermined amount of capital, as the underwriters take on the financial risk associated with selling the securities. By purchasing the entire offering, underwriters assume responsibility for selling the securities to the public and, in the event they cannot sell all the securities at the desired price, they may incur losses. This contrasts with other forms of underwriting, such as best efforts underwriting, where underwriters do not guarantee the sale of all securities and only commit to selling what they can. Hence, the essential aspect of firm commitments is that the underwriters take on the full amount of the issue, which provides a level of financial security to the issuer.