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Real Estate Glossary

Breakup Fee

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Written by Luis Escobar

Typically between 1 and 3 percent of the sale price, a breakup fee–also known as termination fee–is a type of provision in a takeover agreement that requires a company to pay the investment banker a sum of money should another firm take over. This fee is meant to intimidate other firms from making any bids to the target company.

Typically between 1 and 3 percent of the sale price, a breakup fee–also known as termination fee–is a type of provision in a takeover agreement that requires a company to pay the investment banker a sum of money should another firm take over. This fee is meant to intimidate other firms from making any bids to the target company.

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Luis Escobar

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