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op·tion 1 /'äp-shən/ n1: the power or right to choose; also: a choice made or available2: a privilege of demanding fulfillment of a contract on any day within a specified time3: a contract conveying in exchange for the payment of a premium a right to buy or sell designated securities, commodities, or interests in property at a specified price during a stipulated period; also: the right conveyed by such a contractdecided to exercise his optioncall option: an option to buy at a fixed price at or within a certain time compare put option in this entrycovered option: an option in which the optionor owns the security or commodity to be conveyed under the option compare naked option in this entryfutures option: an option on futuresin·cen·tive stock option /in-'sen-tiv-/: a stock option granted by a corporation to its officers and employees as supplementary compensation that is subject to special tax treatment under the Internal Revenue Codeindex option: an option on a stock indexnaked option: an option in which the optionor does not own the security or commodity and will have to purchase it at market price if the optionee decides to exercise the option compare covered option in this entryput option: an option to sell for a fixed price at or within a specified timestock option: an option giving the optionee the right to purchase a specified number of shares of stock from a corporation at a specified price at or within a specified time see also incentive stock option in this entry4: a right of an insured to choose the form in which various payments due him or her on a policy shall be made or applieddividend option: an option allowing the owner of a participating insurance policy and esp. a life insurance policy to determine how dividends are to be paid (as in cash or by being applied as payment for additional insurance)installments–for–a–fixed–amount option: a settlement option in which the insurer retains the policy proceeds and makes periodic payments of a fixed amount until the proceeds are exhausted – called also fixed amount option;installments–for–a–fixed–pe·ri·od option: a settlement option in which the policy proceeds are retained by the insurer and paid in installments over a fixed period of time – called also fixed period option;interest–only option: a settlement option in which the insurer retains the policy proceeds and makes interest payments at a guaranteed minimum ratejoint–and–last–survivorship option: an option in which the insurer makes periodic payments to two or more persons (as a husband and wife) of the proceeds or usu. cash value of a policy until the death of the last survivorlife income option: a settlement option in which the insurer retains the policy proceeds and makes periodic payments for the beneficiary's life or for a specified number of years even after the beneficiary's death with payments to a different recipientnon·for·fei·ture option /ˌnän-'fȯr-fə-ˌchu̇r-/: an option (as to surrender the policy for its cash value or convert the policy to one with a smaller face amount or to a term policy with a shorter period) available to a policyholder who has ceased paying premiumssettlement option: an option to receive payments of the proceeds of a life insurance policy other than by lump sumoption 2 vt: to grant or take an option onstarted buying or option ing riverfront land — Rita Koselka
Merriam-Webster’s Dictionary of Law. Merriam-Webster. 1996.
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I
(choice) noun
alternate choice, alternative, choice, discretion, election, free decision, free selection, free will, freedom, freedom of choice, leave, liberty, opportunity, pick, power to choose, preference, right of choice, selection
associated concepts: election between options, exercise of option, options after default
II
(contractual provision) noun
acquired right, agreement, allowance, approval, authorization, consent, continuing offer, continuing offer to buy, favor, grant, guaranty, license, power, prerogative, privilege, proviso, right, right to buy or sell, sanction, stipulation, term, understanding
associated concepts: conditional option, continuing option, exercise of an option, first option, irrevocable option, option to buy, option to lease, option to purchase, option to renew, option to sell
III
index
choice (alternatives offered), conatus, discretion (power of choice), election (choice), franchise (right to vote), latitude, preference (choice), suffrage, volition, vote
Burton's Legal Thesaurus. William C. Burton. 2006
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n.The right to choose something; something that can be chosen.
The Essential Law Dictionary. — Sphinx Publishing, An imprint of Sourcebooks, Inc. Amy Hackney Blackwell. 2008.
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An agreement that conveys the right to purchase property or engage in a transaction in the future upon agreed-upon terms. An option is paid for as part of a contract, but must be "exercised" in order for the property to be purchased or the transaction to be completed.Category: Business, LLCs & Corporations → Business Accounting, Bookkeeping & FinancesCategory: Business Cash Flow Problems & BankruptcyCategory: Business, LLCs & Corporations → Business Tax & DeductionsCategory: Personal Finance & Retirement → Taxes → Tax Audits
Nolo’s Plain-English Law Dictionary. Gerald N. Hill, Kathleen Thompson Hill. 2009.
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A contract under which one party pays a premium in return for the right (but not the obligation) to buy (call) an asset from the other, or to sell (put) an asset to the other, at a particular price (the exercise price) on a particular date (in the case of a European-style option), or (in the case of an American-style option) at any time in a period before a particular date. The underlying asset might be, for example, an interest rate, a currency, shares or a commodity. Some options provide for cash settlement. In the context of an employee share option scheme, call options may be granted to employees for no, or only nominal, consideration.Related links+ optionUSAA contract giving the holder the right, but not the obligation, to purchase or sell a specific asset at a certain price (often at a certain future date). There are different kinds of options. For example, an employee stock option is a company security that gives a company employee (the holder) the right to buy the company's common stock at a certain price. In certain corporate transactions, an option can also refer to a put option or a call option for non-securities assets.However, options sold in the stock market are securities of a company giving the holder (an investor) the right to buy (also referred to as a call or call option) or sell (also referred to as a put or put option) a security of that company at a certain price for a limited period of time.See also
Practical Law Dictionary. Glossary of UK, US and international legal terms. www.practicallaw.com. 2010.
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1 n. The power or right to make a choice.2 n. A contract to keep an offer open for a specified period of time so that the person making the offer cannot suddenly withdraw it during that period.3 n. The right carried by that contract.4 n. The right to sell or buy a certain number of stocks or bond at a set price within a specified time period.5 v. To give or take an option on something.
Webster's New World Law Dictionary. Susan Ellis Wild. 2000.
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A privilege, for which a person has paid money, that grants that person the right to purchase or sell certain commodities or certain specified securities at any time within an agreed period for a fixed price.A right, which operates as a continuing offer, given in exchange for consideration—something of value—to purchase or lease property at an agreed price and terms within a specified time.
Dictionary from West's Encyclopedia of American Law. 2005.
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A privilege, for which a person has paid money, that grants that person the right to purchase or sell certain commodities or certain specified securities at any time within an agreed period for a fixed price.A right, which operates as a continuing offer, given in exchange for consideration—something of value—to purchase or lease property at an agreed price and terms within a specified time.
Short Dictionary of (mostly American) Legal Terms and Abbreviations.
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n.a right to purchase property or require another to perform upon agreed-upon terms. An option is paid for as part of a contract, but must be "exercised" in order for the property to be purchased or the performance of the other party to be required. "Exercise" of an option normally requires notice and payment of the contract price. Thus, a potential buyer of a tract of land might pay $5,000 for the option which gives him/her a period of time to decide if he/she wishes to purchase, tying up the property for that period, and then pay $500,000 for the property. If the time to exercise the option expires then the option terminates. The amount paid for the option itself is not refundable since the funds bought the option whether exercised or not. Often an option is the right to renew a contract such as a lease, broadcasting a television series, the employment of an actor or athlete, or some other existing business relationship. A "lease-option" contract provides for a lease of property with the right to purchase the property during or upon expiration of the lease.
Law dictionary. EdwART. 2013.
