Do you incorporate dead deal / break up clauses in your ETA deal? Why / Why not?

searcher profile

November 10, 2025

by a searcher from University of Chicago in Chicago, IL, USA

To me, it seems sensible & fair to have in-writing by % or specific costs and based on when (ie how early or late the deal falls apart) and for what reason, but I'm hearing that to include such fees means to likely lose out on deals to other searchers who don't include such clauses (which could make sense for brokered deals, but I'm not sure about proprietary deals). Thoughts?
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Reply by an intermediary
from The University of Chicago in Chicago, IL, USA
On large deals, seller pays break-up fees if they accept a larger offer or breaches exclusivity, etc. In PE world, IS, Individual buyers, Searchers, buyer pays fee (called reverse break-up fee) if they cannot get financing, regulatory approval, etc. You are lucky if you can get a seller to agree to pay buyer a break-up fee. Very unlikely if his attorney will allow it. Incentivizing broker will create conflict.
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Reply by a searcher
from George Brown College in Winnipeg, MB, Canada
Most sellers and brokers won’t agree to cover broken-deal costs, and including that clause in your LOIs will likely cause you to miss out on opportunities.
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