Navigating Financing Challenges in M&A with a Reverse Termination Fee and Conditional Specific Performance Clause

With the ebbs and flows of an uncertain financial market, deal certainty is increasingly important for buyers and sellers alike. When a buyer’s ability to close an M&A transaction is dependent upon third-party financing arrangements, sellers may want to include a reverse termination fee in the event the deal fails to close because of a financing failure. Adding an unconditional or conditional specific performance provision to the acquisition agreement also gives sellers the right to pursue equitable remedies instead of relying on reverse break fees and damages as the sole remedy. Explore how a reverse termination fee and conditional specific performance clause safeguards deals and ensures performance even when the financial tides turn.    

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