Termination option

1. The valuable operational choice available to the owner of a project or of a business, to terminate all or part of it.

This is an example of a real option. Other examples of real options include the options to expand, contract or defer the given project or business.

Also known as an Abandonment option.

2. Similar rights in a contract, either at the absolute discretion of the contracting party, or on the occurrence of a specified event.

See also

• Real option