A merger agreement includes a reverse break-up fee of $500 million payable by the acquirer. In which scenario would this fee most likely be triggered?

Why D — Acquirer fails to obtain required antitrust clearance or financing, causing the deal to fail

A reverse break-up fee is payable by the acquirer to the target when the acquirer fails to close the transaction due to its own inability to satisfy closing conditions, such as failure to obtain regulatory approval or financing. These fees protect the target from the risk that the acquirer cannot consummate the deal after the target has invested significant time and foregone other opportunities. Reverse break-up fees became more common after the 2008 financial crisis when several buyers walked away from signed deals.