financing out

financing out
USA
A condition precedent contained in acquisition agreements that permits the buyer not to complete the acquisition if it cannot get sufficient financing to fund the acquisition. Financing outs are not seen as often as they were in the past due to the increased bargaining power of financial sponsors and sellers. Refers to allowing the buyer to get "out" of its agreement to buy the target company.

Practical Law Dictionary. Glossary of UK, US and international legal terms. . 2010.

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