# Last Price > Last Price means the final closing or sales price of a security as reported by a major exchange or quotation system. **Term:** Last Price **Last updated:** 2026-07-29 ## Definition ## What Last Price Means in a Contract Last Price refers to the final price at which a security, commodity, or financial instrument traded before a market or exchange closed, or the most recent quotation reported by an agreed data source. In contract drafting, it functions as an objective benchmark that removes ambiguity from valuation clauses. Rather than relying on a party's own assessment of worth, the contract points to a verifiable, external figure that both sides can check independently. This concept commonly appears in agreements involving securities transfers, financial collateral, share buybacks, or any transaction where the value of an underlying asset fluctuates and must be pinned down at a specific moment. Because markets move constantly, contracts need a precise mechanism for freezing a value, and Last Price provides that anchor. The term is especially useful because it ties contractual outcomes to publicly available, third-party data rather than internal calculations, reducing the risk of disagreement between the parties about what a fair or correct price actually was. ## How Last Price Is Defined or Measured Most agreements define Last Price by reference to a named exchange, index provider, or quotation system, such as a stock exchange's official closing price feed. The definition typically specifies the exact source, the time of day the price is captured, and the currency or unit of measurement involved. Precision matters because different data providers can report slightly different figures depending on how they calculate closing values, whether they include after-hours trading, or how they handle days when markets are closed for holidays. A well-drafted clause will address: - The specific exchange, index, or quotation system used as the authoritative source - The exact time or trading session the price reflects - What happens if that market is closed, suspended, or the security is not traded that day - Whether adjustments are made for stock splits, dividends, or corporate actions Some contracts also specify a fallback mechanism, such as using the previous trading day's Last Price if the primary source is unavailable, to avoid disputes when normal reporting is disrupted. ## Where Last Price Appears in Agreements Last Price shows up most frequently in financial and securities-related contracts, including share purchase agreements, collateral arrangements, and instruments tied to market-linked payouts. It is also relevant in a broader range of commercial documents, such as an [Exchange Agreement](https://www.genieai.co/en-us/template-type/exchange-agreement) or a [Sales and Purchase Agreement](https://www.genieai.co/en-us/template-type/sales-and-purchase-agreement), where the value of shares, commodities, or other tradable assets forms part of the consideration. It can also feature in agreements used within the [Finance](https://www.genieai.co/industry/finance) industry, where valuation triggers, margin calls, or settlement calculations depend on a clearly defined market price rather than a negotiated estimate. In each case, the clause serves the same underlying purpose: converting a moving market value into a fixed, contractually usable number at a defined point in time. Beyond pure securities transactions, businesses sometimes borrow the concept for internal valuation clauses tied to publicly traded inputs, such as commodity-linked pricing formulas in supply contracts. ## Why the Exact Wording Matters Small differences in how Last Price is worded can produce significantly different financial outcomes. If a clause fails to specify the exact time zone, trading session, or data source, the parties may end up disputing which figure actually applies, particularly when prices shift sharply within a single day. Ambiguity also creates risk around market disruptions. Without a fallback provision, a contract may be silent on what happens if trading is halted, the exchange closes early, or the security is delisted. This can leave the parties without a clear mechanism for calculating obligations at a critical moment. Courts interpreting these clauses generally apply the plain wording of the contract and the law governing the contract, so vague or incomplete definitions increase the likelihood of costly disputes rather than smooth, automatic resolution. ## Drafting Considerations When drafting a Last Price clause, parties should name the exact exchange or data provider, specify the time the price is captured, and state the currency in which it is expressed. It is also wise to address how corporate actions like stock splits or dividends affect the reported figure. Including a clear fallback provision for days when the market is closed, suspended, or the security is not actively traded helps prevent gaps that could otherwise stall a transaction or trigger disputes. Parties should also consider whether the clause needs to reference multiple sources in case the primary provider becomes unavailable. Finally, cross-referencing the Last Price definition consistently throughout the agreement, rather than restating it with slightly different wording elsewhere, reduces the risk of internal inconsistency that could undermine enforcement. ## Context ### Relevant circumstances - Negotiating the sale of shares - Setting the price for options contracts - Determining the value of investments ### Relevant sectors - Finance ## Relevant contract types - [Exchange Agreement](https://www.genieai.co/en-us/template-type/exchange-agreement) - [Sales and Purchase Agreement](https://www.genieai.co/en-us/template-type/sales-and-purchase-agreement) --- This is the Markdown representation of [https://www.genieai.co/en-us/define/last-price](https://www.genieai.co/en-us/define/last-price), provided for AI agents and crawlers. The HTML page is canonical. See [/llms.txt](https://www.genieai.co/llms.txt) for the full content map.