Drop Dead Date

DEFINITION of 'Drop Dead Date'

A provision in a contract or agreement that stipulates a finite deadline which, if not met, will automatically trigger adverse consequences. The drop dead date is the last possible date on which something must be completed. In most circumstances an extension is not possible.

BREAKING DOWN 'Drop Dead Date'

Time-critical contracts usually contain a drop dead date. For example, a contract for construction of an industrial facility or infrastructure project will stipulate a definite date for the commissioning of the former and completion of the latter. If this deadline is not met, the project contractor may automatically be liable for such damages and penalties as are set out in the project contract.

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