{"ok":true,"canonical_url":"https://dealroom.so/glossary/automatic-termination","api_url":"https://dealroom.so/api/public/glossary/automatic-termination","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"automatic-termination","term":"Automatic termination","group":"Doing the deal","definition":"A predefined event or condition that causes a contract or agreement to end without further action from either party. This impacts how certain agreements, like standby notes, conclude.","what_it_means":"In some seller financing structures, a standby agreement might have an automatic termination clause, converting the standby debt to regular debt upon a certain event, like full repayment of the SBA loan. Understand these clauses to know when seller notes become active repayment obligations.","url":"https://dealroom.so/glossary/automatic-termination","official_sources":[{"slug":"sop-50-10","title":"SOP 50 10 — Lender and Development Company Loan Programs","official_url":"https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs","official_label":"View on SBA.gov","authority_tier":2,"publisher":"U.S. Small Business Administration","source_guide_url":"https://dealroom.so/sba-7a/sources/sop-50-10"}],"related":[{"slug":"standby","term":"Standby","url":"https://dealroom.so/glossary/standby"},{"slug":"full-standby-agreement","term":"Full Standby Agreement","url":"https://dealroom.so/glossary/full-standby-agreement"},{"slug":"seller-note","term":"Seller note","url":"https://dealroom.so/glossary/seller-note"}],"related_questions":[{"question":"What specific criminal history issues are automatic disqualifiers for SBA loan eligibility?","url":"https://dealroom.so/sba-7a/questions/what-specific-criminal-history-issues-are-automatic-disqualifiers-for-sba-loan-eligibility"},{"question":"How does the SBA review franchise agreements for compliance if there are unusual clauses regarding termination or transfer?","url":"https://dealroom.so/sba-7a/questions/how-does-the-sba-review-franchise-agreements-for-compliance-if-there-are-unusual-clauses-r"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — Automatic termination","url":"https://dealroom.so/glossary/automatic-termination","source_type":"DealRoom Data"}}