Earnouts are contractual clauses in private M&A that tie part of the purchase price to the target business’s performance post-closing.
The use and structure of an earnout is inherently deal-specific. Earnouts are by nature bespoke and typically highly negotiated. Earnouts may also be more susceptible to post-closing disputes than some other private M&A deal terms.
Careful and informed earnout negotiation and drafting is therefore critical to achieving the parties’ objectives. To assist, we have prepared this concise but comprehensive practical guide to earnout structuring, negotiation and strategy. Download Earnouts in Private M&A: Negotiation, Drafting and Strategy below today.
Highlights of our guide:
- Advantages and disadvantages of earnouts
- Earnout structuring and key terms
- Dispute resolution clauses and mechanics
- Learning from past earnout disputes
- Key differences between Canadian and Delaware law
- Potential earnouts alternatives
- Key practical and strategic takeaways
Fasken has extensive experience advising on all aspects of private M&A. Our cross-country reach, deep roster of M&A specialists, and consistent market-leading deal flow distinguish us from other business law firms and provide our clients with a clear advantage. We are committed to delivering exceptional service and strategic advice to help you navigate the complexities of private M&A, including any earnout negotiation and structuring.
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