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Finance allah shmoop What are a firm deal Ah firm

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commit and a firm quote No a lot of firms

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here is by agra involved in this one No Well

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okay people Yes You knew we were going to go

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there We'll start with firm commit Well the whole notion

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of a firm commit applies on a few fronts Like

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if a lender is lending dough Well usually there is

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a contractual agreement cleverly called a firm commitment letter and

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it derives a firm deal like the deal will follow

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that commitment And that letter specifies the amount of money

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the lender is willing to lend at a given interest

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rate With all the terms you know spelled out for

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given time like this offer is good for thirty days

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or until june first Or until the where wolf grows

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What they crow Don't they Okay howl whatever In an

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ai po when a bank is selling shares on behalf

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of a company issuing them a firm commit gives rise

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to a firm deal And it basically says that the

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bank is responsible for selling any unsold shares That is

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It's called a quote bought deal unquote And the bank

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Either sells those aipo shares to investors or well they

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buy them for their own account In a firm quote

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the commitment involved usually refers to a broker dealers bid

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ask spread in selling those shares like she holds a

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few million shares of amazon in inventory and publishes to

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her constituency that she is firm as a buyer at

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eleven hundred two and twenty and a seller at eleven

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hundred eight and fifty Got it sets one one zero

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two point two zero in a cellar at one one

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zero eight point five oh yeah that's how it would

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look well if anyone matches those numbers then she is

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legally obligated to sell them And just in case someone

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wants to buy a good gillian shares i am or

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than she carries in inventory well there's usually a limit

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number attached to her offer for like i stand firm

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on one hundred thousand at this price like a hundred

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thousand shares and not a hundred thousand won something like

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that anyway so firm think obligated confirmed contracted for legally

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binding and sometimes yeah that'll give you cramps Just try 00:02:17.1 --> [endTime] prunes

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