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What Is a Buy and Sell Agreement? A buy and sell agreement (or buy-sell agreement) is a legally binding contract that stipulates how a partner’s share of a business may be reassigned if that partner dies or otherwise leaves the business. Most often, the buy and sell agreement stipulates that the available share be sold

What Is a Buyback? A buyback, also known as a share repurchase, is when a company buys its own outstanding shares to reduce the number of shares available on the open market. Companies buy back shares for a number of reasons, such as to increase the value of remaining shares available by reducing the supply or to prevent other shareholders from taking a controlling

What Is a Buyback Deductible? A buyback deductible is an insurance contract provision that allows an insured party to pay a higher premium to reduce or eliminate the deductible that the insured would have to pay if a claim is made. A buyback deductible (also called a deductible buyback) can be an add-on to an existing

What Is a Buyback Ratio? The buyback ratio is the amount of cash paid by a company for buying back its common shares over a time period, usually the past year, divided by its market capitalization at the beginning of the buyback period. The buyback ratio enables analysts to compare the potential impact of repurchases

What Is a Buyer’s Call? A buyer’s call is an agreement between a buyer and seller in which the purchase of a commodity is at a specific price above a futures contract that is for the same grade and quantity. The agreement gives the buyer the option to fix the commodity price by either purchasing

What Is Buyer’s Credit? Buyer’s credit is a short-term loan facility extended to an importer by an overseas lender such as a bank or financial institution to finance the purchase of capital goods, services, and other big-ticket items. The importer, to whom the loan is issued, is the buyer of goods, while the exporter is the

What Is a Buyer’s Market? A buyer’s market refers to a situation in which changes to the underlying economic conditions that shape supply and demand mean that purchasers have an advantage over sellers in price negotiations. Key Takeaways A buyer’s market refers to a situation in which purchasers have an advantage over sellers in price

What Is a Buyer’s Option? A buyer’s option, in commercial contracts, is an agreement between a vendor and a buyer that defines price and specifications over a specified period for a product. The buyer’s option does not stipulate the quantity of the product that the buyer is obligated to purchase. In the auction industry, when