Earn-Out Clause Samples
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Earn-Out. (a) Upon an investor in an investment vehicle or a client entering into a capital commitment during the Earn-Out Period with respect to a Qualifying Earn-Out Product, the Buyer shall pay to the Sellers an amount equal to the product of (1) .02 and (2) the aggregate amount of such capital commitment (each, an “Earn-Out Payment”). The Buyer shall pay or cause to be paid to ACM, on behalf of the Sellers, by wire transfer of immediately available funds to such account(s) as ACM shall designate in writing to the Buyer, such Earn-Out Payment within 120 days following the date upon which the investor or client enters into the applicable commitment. In no event will the Buyer be obligated to pay more than the Maximum Earn-Out Amount in aggregate Earn-Out Payments.
(b) From and after the Closing and until the Maximum Earn-Out Amount in aggregate Earn-Out Payments have been paid in full pursuant to Section 3.3(a), within thirty (30) days following the end of each Reporting Period, the Buyer shall deliver or caused to be delivered to the Sellers a reasonably detailed statement prepared in good faith (an “Earn-Out Report”), which shall set forth, in each case along with the related calculations, but subject to any confidentiality obligations of the Buyer, (i) the Qualifying Earn-Out Product or its general partner, manager, or equivalent, the investors or client entering into capital commitments with respect to Qualifying Earn-Out Products (together with the amount of such capital commitments) during such Reporting Period, and the Earn-Out Payments attributable thereto and (ii) the cumulative amount of capital commitments with respect to Qualifying Earn-Out Products during period from and after the Closing Date and through the end of the applicable Reporting Period, together with the cumulative Earn-Out Payments attributable thereto. During the period beginning on delivery of an Earn-Out Report and ending thirty (30) days later (a “True-Up Period”), the Buyer shall make available to the Sellers and their Representatives, subject to any confidentiality obligations of the Buyer, the Qualifying Earn-Out Product or its general partner, manager, or equivalent, all relevant personnel, Representatives, books and records and other information reasonably requested by the Sellers in connection with the Sellers’ review of such Earn-Out Report, including the capital commitments entered into during such Reporting Period. Such Earn-Out Report received by ACM will be deemed to be acc...
Earn-Out. A. Each Sponsor agrees that the number of HMAUF Shares owned by such Sponsor and set forth opposite such Sponsor’s name in the column captioned “Earn-Out Shares” on Exhibit A (the “Earn-Out Shares”) shall be forfeited and cancelled unless the First Earn-Out Milestone is met or the Second Earn-Out Milestone is met. Each Sponsor agrees to enter into the Escrow Agreement with the Escrow Agent, the Sellers and the Company simultaneously with the Closing.
B. At the Closing, each Sponsor whose HMAUF Shares are not held by the IPO Escrow Agent shall transfer and deliver to the Escrow Agent under the Escrow Agreement such Sponsor’s Earn-Out Shares. At the Closing, each Sponsor whose HMAUF Shares are held by the IPO Escrow Agent shall deliver irrevocable instructions to the IPO Escrow Agent to deliver to the Escrow Agent such Sponsor’s Earn-Out Shares at the time such Earn-Out Shares would otherwise be delivered to such Sponsor under the IPO Escrow Agreement. At the Closing, each Sponsor shall deliver to the Escrow Agent all stock powers, assignments and related documents as may be necessary to effect the transfer to the Company and cancellation of such Sponsor’s Earn-Out Shares.
C. If the First Earn-Out Milestone is met, each Sponsor shall be entitled to receive such Sponsor’s Earn-Out Shares on the First Earn-Out Milestone Date. If the First Earn-Out Milestone is not met but the Second Earn-Out Milestone is met, each Sponsor shall be entitled to receive such Sponsor’s Earn-Out Shares on the Second Earn-Out Milestone Date. If neither the First Earn-Out Milestone nor the Second Earn-Out Milestone is met, all of the Earn-Out Shares shall be forfeited to the Company and cancelled. The Earn-Out Shares shall be released to the Sponsors or the Company at the times and in the manner provided in the Escrow Agreement.
Earn-Out. (a) Subject to the terms and conditions of this Section 2.6, the Earn Out Units shall be issuable to the Company Equity Holders in accordance with the terms of Section 2.2 as follows (any such issuable Earn Out Units, “Earned Earn Out Units”):
(i) if at any time during the twelve (12) months following the Closing the VWAP of the Surviving Pubco Class A Shares is greater than or equal to $12.50 over any twenty (20) Trading Days within any thirty- (30-) Trading Day period, 50% of the Earn Out Units; and
(ii) if at any time during the twenty-four (24) months following the Closing the VWAP of the Surviving Pubco Class A Shares is greater than or equal to $14.00 over any 20 Trading Days within any 30-Trading Day period, 100% of the Earn Out Units. Notwithstanding anything to the contrary set forth in this Agreement, the number of Earn Out Units to be issued pursuant to this Section 2.6 shall be limited such that in no event shall the Company Equity Holders receive more than 100% of the Earn Out Units. The Surviving Pubco Class A Share price targets in clauses (i) and (ii) shall be equitably adjusted for stock splits, stock dividends, reorganizations, combinations, recapitalizations and similar transactions affecting the Surviving Pubco Class A Shares after the date of this Agreement (other than in respect of issuances of Surviving Pubco Class A Shares in connection with (i) any Additional Equity Financing or (ii) the issuance of the Equity Consideration (including the Estimated Equity Consideration)).
(b) In the event of the satisfaction of the threshold set forth in Section 2.6(a)(i) or the threshold set forth in Section 2.6(a)(ii), as soon as practicable (but in any event within five (5) Business Days) after such satisfaction, the Surviving Pubco will deliver to the Company Securityholder Representative a written statement (each, a “Stock Price Earn-Out Statement”) that sets forth (i) the VWAP over the applicable 20-Trading Day period and (ii) the calculation of the amount of Earned Earn Out Units in connection therewith. Any Earned Earn Out Units issuable as a result of the satisfaction of the threshold set forth in Section 2.6(a)(i) or the threshold set forth in Section 2.6(a)(ii) shall be issued to the Company Equity Holders in accordance with Section 2.2 and the Earn Out Payout Schedule within five (5) Business Days after such satisfaction.
(c) Following the Closing, including during the twenty-four (24) months following the Closing, the Surviving Pubco a...
Earn-Out. (a) The amount to be paid (subject to the terms and conditions of Sections 1.6(d), Section 1.7 and Section 1.9), by Purchaser on the Earn-Out Payment Date (the “Earn-Out Amount”) shall comprise the Earn-Out Cash Payment as defined in Section 1.6(b) below, and the Earn-Out Stock Payment as defined in Section 1.6(c) below.
(b) The Earn-Out Cash Payment shall be the cash amount (the “Earn-Out Cash Portion”) notified by the Purchaser to the Sellers’ Representative in writing no later than 18:00 hours in Paris on the fourth Business Day before the Earn-Out Payment Date, provided that this amount shall be equal to or greater than forty percent (40%) of the Earn-Out Calculation Amount.
(c) The Earn-Out Stock Payment shall be equal to a number of shares of Purchaser Common Stock (the “Earn-Out Stock Payment”) determined by dividing (x) the Earn-Out Calculation Amount, minus the Earn-Out Cash Portion and minus five percent (5%) of the amount (if any) by which the Earn-Out Cash Portion exceeds 40% (forty) percent of the Earn-Out Calculation Amount by (y) the average of the closing price of Purchaser shares as reported on the NASDAQ website, over a period of twenty (20) consecutive trading days, the last day included in such period being the trading day five (5) trading days prior to the Earn-Out Payment Date (the “Earn-Out Purchaser Shares Price”).
(d) The Earn-Out Calculation Amount shall be equal to the sum of (i) the EBITDA Amount as defined below and (ii) the Gross Profit Amount as defined below:
(i) The EBITDA Amount shall be equal to:
(1) nine million euros (€9,000,000) if Actual EBITDA is equal to or exceeds Budgeted EBITDA; or
(2) nine million euros (€9,000,000) multiplied by a fraction, the numerator of which shall be Actual EBITDA minus seven million four hundred forty thousand euros (€7,440,000) and the denominator of which shall be one million eight hundred sixty thousand euros (€1,860,000), if Actual EBITDA is equal to or exceeds eighty percent (80%) of Budgeted EBITDA and is below Budgeted EBITDA; or
(3) zero if Actual EBITDA is less than eighty percent (80%) of Budgeted EBITDA.
(ii) The Gross Profit Amount shall be equal to:
(1) six million euros (€6,000,000) if Actual Gross Profit is equal to or exceeds Budgeted Gross Profit; or
(2) six million euros (€6,000,000) multiplied by a fraction, the numerator of which shall be Actual Gross Profit minus nineteen million three hundred ninety-four thousand and four hundred euros (€19,394,400) and the denominat...
Earn-Out. (a) In addition to the Purchase Price, if the Company meets or exceeds (i) the Revenue Target and (ii) the Product Margin Target, Purchaser shall pay in cash to Sellers, on a pro-rata basis, the Earn-Out Amount less the product of the Stock Consideration and the ADS Appreciation Ratio (the “Earn-Out”) exclusive of any Tax, fees or other expenses of any kind; provided that the exchange rate shall be fixed at the Exchange Rate for the calculation of the Earn-Out. The Earn-Out shall not exceed the Earn-Out Amount.
(b) Within ten (10) business days after the announcement date of Parent’s fourth quarter fiscal year 2007, Purchaser shall prepare, or cause to be prepared, and deliver to the Sellers’ Representative (i) a statement setting forth the Product Revenues for the calendar year 2007, each component used in the calculation thereof, the ADS Appreciation Ratio and the amount of the Earn-Out determined in accordance with Section 2.4(a) (the “Earn-Out Statement”), which shall be prepared in accordance with the Adjusted Korean GAAP, at Purchaser’s cost and expense, and (ii) such documentation, if any, as may be reasonably necessary to enable the Sellers’ Representative to determine such amount. Concurrently with the delivery of the Earn-Out Statement, Purchaser shall deposit into a nominated account as established by the Sellers’ Representative for payment to Sellers, on a per share basis, the amount of the Earn-Out, if any, specified in the Earn-Out Statement.
(c) After receipt from Purchaser of the Earn-Out Statement and, if applicable, the Earn-Out, Sellers shall have the right, at its cost and expense, and upon not less than seven (7) days’ prior written notice to Purchaser, to (i) meet with Purchaser and the Company Accounting Firm to discuss Purchaser’s calculation of the amount of the Product Revenues, the ADS Appreciation Ratio and the Earn-Out as set forth in the Earn-Out Statement and (ii) have reasonable access during normal business hours to inspect the books and records of the Company and working papers (including those prepared by advisors and other third parties, to the extent permitted thereby) relating to such calculation. If the Sellers’ Representative fails to challenge Purchaser’s determination of the Product Revenues, the ADS Appreciation Ratio and the amount of the Earn-Out by the delivery of a written notice to Purchaser (the “Earn-Out Dispute Notice”) within sixty (60) days after receipt by the Sellers’ Representative of the Earn-Out Sta...
Earn-Out. Subject to the terms and conditions of this Agreement, the Sellers shall be eligible to receive additional consideration in the amount of $20,000,000 (the “Earn Out Payment”) based on the achievement of certain business milestones as set forth below.
(a) If the C▇▇▇ equals or exceeds $16,000,000 (the “Earn Out Target”) at December 31, 2016 (the “Earn Out Date”), the Buyer shall pay to the Sellers the Earn Out Payment. In the event that the C▇▇▇ at December 31, 2016 is less than the Earn Out Target, no Earn Out Payment shall become payable to the Sellers.
(b) From the Closing through the Earn Out Date:
(i) the Sellers and the Buyer shall owe each other a duty of good faith and fair dealing with regard to the operation of the Company in so far as, in the case of the Buyer, that relates to the ability of the Company to achieve the Earn Out Target as of the Earn Out Date and, in the case of the Sellers, that relates to good business practices and the Company’s business, operations, prospects and condition (whether financial or otherwise);
(ii) the Buyer shall not (A) take any action with the specific intent of preventing the Company from achieving the Earn Out Target or (B) cause the Company to dissolve, wind up or liquidate; and
(iii) on a monthly basis, the Buyer will prepare and deliver to the Sellers’ Representative a statement setting forth in reasonable detail the C▇▇▇ as of such date for review and comment. If the Buyer breaches any of the covenants set forth in Sections 1.7(b)(i) or 1.7(b)(ii), then the Sellers’ Representative shall provide the Buyer with written notice thereof (a “Default Notice”) within seven (7) days following the occurrence of such breach, which such Default Notice must provide reasonable detail as to the nature of the breach. If (a) the Buyer does not cure the breach within seven (7) days following receipt of a Default Notice with respect thereto or (b) it is not feasible for such breach to be cured within such seven (7) day period, then the Earn Out Payment shall become immediately due and payable from the Buyer to the Sellers in accordance with this Agreement on the assumed basis that the Earn Out Target had been met in full.
(c) The Earn Out Payment is expressly conditioned upon the continued employment of R▇▇▇▇▇ ▇▇▇▇▇▇▇, R▇▇▇▇ ▇▇▇▇ and J▇▇▇▇ ▇▇▇▇▇▇▇ (each, an “Earn Out Employee”) with the Company through the Earn Out Date. In the event that at least one (1) of the Earn Out Employees is not employed by the Company or another Af...
Earn-Out. (a) As additional consideration (the “Earn-Out Consideration”) for the Equity Interests and Transferred Assets, Purchaser shall pay to Seller Parent (on behalf of Sellers) an amount, if any, equal to: (i) Three Million Dollars ($3,000,000.00) if the Combined Adjusted EBITDA Margin exceeds five percent (5%); and (ii) an additional Two Million Dollars ($2,000,000.00) if the Combined Adjusted EBITDA Margin exceeds seven percent (7%) (it being understood that the amounts set forth in the foregoing clauses (i) and (ii) are cumulative and not alternative), in each case in accordance with this Section 2.5. For the avoidance of doubt, in no event shall the Earn-Out Consideration payable to Sellers pursuant to this Section 2.5 exceed Five Million Dollars ($5,000,000.00) in the aggregate (the “Maximum Earn-Out Consideration Amount”).
(b) Following the Closing, Purchaser shall, and shall cause its Affiliates (including the Transferred Entities) to, (i) maintain adequate financial records for, and allocate costs to, the Combined Business in accordance with Purchaser’s internal reporting policies and requirements and US GAAP; and (ii) not take or omit to take any actions with a purpose or intention to avoid, reduce, or otherwise frustrate the payment of the Earn-Out Consideration.
(c) With respect to each of Fiscal Year 2016 and Fiscal Year 2017, no later than 10 days after the filing of Purchaser’s annual report on Form 10-K with the SEC for such fiscal year or, if Purchaser is no longer required to file such report or if such report is not timely filed by Purchaser, no later than 75 days after the end of such fiscal year, Purchaser shall prepare (or cause to be prepared) and deliver to Seller Parent financial statements (the “Earn-Out Financial Statements”) prepared in accordance with US GAAP consistently applied and consisting of a balance sheet and statements of income, changes in stockholders equity and cash flows of the Combined Business as of the end of, and for, such fiscal year, together with calculations of (i) in respect of the Earn-Out Financial Statements delivered for Fiscal Year 2016, the Combined Adjusted EBITDA and Combined Revenue for Fiscal Year 2016 and (ii) in respect of the Earn-Out Financial Statements delivered for Fiscal Year 2017, the Combined Adjusted EBITDA and Combined Revenue for Fiscal Year 2017 and the resulting calculation of the Combined Adjusted EBITDA Margin. Following delivery of any Earn-Out Financial Statements to Seller Parent, P...
Earn-Out. Nothing in this Agreement shall affect Executive's right to Earn-Out payments under the Stock Purchase Agreement.
Earn-Out. (a) As additional consideration for the Purchased Assets, following the Closing, if the Business achieves $10,000,000 or more in Sales during the 12-month period ending December 31, 2017 or the 12-month period ending December 31, 2018 (the “Earn-Out Condition”), the Purchaser shall pay to the Seller Parties an amount equal to the Earn-Out Amount (the “Earn-Out Payment”). For the avoidance of doubt, the Earn-Out Payment, if any, shall be a one-time payment to the Seller Parties, and if the Earn-Out Condition is not satisfied, no Earn-Out Payment shall be made by, or required of, the Purchaser. The maximum amount to be paid by the Purchaser pursuant to this Section 3.4 shall be the Earn-Out Amount.
(b) The amount of Sales shall be determined in accordance with GAAP and consistent with the Seller’s accounting principles used prior to the Closing, following the preparation of the Business’s financial statements for each 12-month period described in this Section 3.4.
(c) The Purchaser shall promptly notify the Sellers’ Representative within sixty (60) days following the 12-month period ending December 31, 2017 or the 12-month period ending December 31, 2018, as applicable, whether the Earn-Out Condition has been achieved and provide Sellers’ Representative with Purchaser’s calculation of Sales for the relevant period. Within five Business Days of notification by the Purchaser to the Sellers’ Representative of the satisfaction of the Earn-Out Condition, the Purchaser shall make or cause to be made the Earn-Out Payment by wire transfer of immediately available funds to the account(s) designated in writing by the Sellers’ Representative to the Purchaser.
(d) The Purchaser shall have the right to withhold and set off against any amount otherwise due to be paid pursuant to this Section 3.4 the amount of (i) adjustment to the purchase price set forth in Section 3.3 and (ii) any Losses to which any Purchaser Indemnified Party is then entitled to under Article X.
(e) The parties hereto understand and agree that (i) the contingent rights to receive any Earn-Out Payment shall not be represented by any form of certificate or other instrument, are not transferable, except by operation of Laws relating to descent and distribution, divorce and community property, and do not constitute an equity or ownership interest in the Purchaser or any of its Affiliates, (ii) none of the Seller Parties shall have any rights as a security holder of the Purchaser or any of its Affiliates a...
Earn-Out. As additional consideration for the Purchase, Buyer agrees to pay Sellers a one-time payment of up to an additional Twenty-Five Million Dollars ($25,000,000.00) (the “Earn-Out Payment”), as follows:
(i) The Earn-out Payment shall be Seven Million Five Hundred Thousand Dollars ($7,500,000.00) if Platinum Vape earns Revenue of at least Eighty Million Dollars ($80,000,000.00) but less than Ninety Million Dollars ($90,000,000.00) within the twelve (12) months immediately following the Closing Date (the “Earn-out Period”);
(ii) The Earn-out Payment shall be Fifteen Million Dollars ($15,000,000.00) if Platinum Vape earns Revenue of at least Ninety Million Dollars ($90,000,000.00) but less than One Hundred Million Dollars ($100,000,000.00) within the Earn-out Period; and
(iii) The Earn-out Payment shall be Twenty Five Million Dollars ($25,000,000.00) if Platinum Vape earns Revenue of more than One Hundred Million Dollars ($100,000,000.00) within the Earn-out Period.
(iv) As a condition to earning the Earn-Out Payment, both of the following must be true: (x) the Company’s EBIT for the Earn-out Period was at least fifteen percent (15%) of Revenue during the Earn-out Period, and (y) Sellers have continued to be employed by RWB or any Company for the entire the Earn-out Period; unless, Sellers resigned for “Good Reason” or were terminated without “Cause,” pursuant to their respective Employment Agreements.
(v) Procedures for Determination of Earn-out Payments.
(A) On or prior to the date that is ten (10) business days after the end of the Earn-out Period (the “Earn-out Calculation Delivery Date”), Buyer shall prepare and deliver to Sellers a written statement (the “Earn-out Calculation Statement”) setting forth in reasonable detail its determination of Revenue for the Earn-out Period, EBIT for the Earn-out Period, and its calculation of the resulting Earn-out Payment, if any (the “Earn-out Calculation”).
(B) Seller shall have ten (10) business days after receipt of the Earn- out Calculation Statement (the “Earn-out Review Period”) to review the Earn-out Calculation Statement and the Earn-out Calculation set forth therein. During the Earn-out Review Period, Sellers and their representatives shall have the right to inspect the Company’s books and records during normal business hours at the Company’s offices. Prior to the expiration of the Earn-out Review Period, Sellers may object to the Earn-out Calculation set forth in the Earn-out Calculation Statement by delivering...