option agreement

Definitions (4)

1. Legal contract between a potential buyer and the seller of a property whereby in exchange for a fee the seller gives the potential buyer, up to a certain date, the first chance to buy that property.
2. Legal contract between two parties whereby, in exchange for a fee, one of the parties has the right but not the obligation to buy or sell a specified item at a specified price up to a specified date.
3. Legal contract between an option investor and a brokerage firm whereby the investor confirms that he or she understands the issues and risks involved in options trading and undertakes to follow the rules and regulations of the options exchange.
4. Legal contract between an employee and employer that sets the terms of the employee's stock options.

Use option agreement in a sentence

You should make sure that you have done all the research you can before you decide to sign the option agreement.

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The option agreement was a really interesting agreement to me and I thought everything was going to work out well.

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Companies like K Mart and Wal Mart offer an option agreement for warranties on their products, within a two year span of time after purchasing.

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