Legal Dictionary of Pakistan

firm-commitment underwriting

Underwriting in which the underwriter agrees to buy all the shares to be issued and remain financially responsible for any securities not purchased. ( The underwriter, or underwriting group, buys the securities from the issuer and resells them as principal. In this type of underwriting, securities that cannot be sold to the public are owned by the underwriter, and the issuer is paid for those securities as well as the others.