Series 79: Out

Taken from our FINRA Investment Banking Exam

Definition of the term Out...

also called a termination provision. A provision in a legally binding document that frees a party from the commitments it made when it signed the document. Often a legitimate concern has to arise to trigger an out, but sometimes an out is worded so that it can be exercised at the discretion of the party. Some outs require the party exercising it to pay the other party a breakup fee.

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