Earn-Out Consideration Clause Samples
The Earn-Out Consideration clause defines the terms under which additional payments may be made to the seller after the closing of a transaction, based on the future performance of the acquired business. Typically, this clause outlines specific financial targets or milestones—such as revenue or EBITDA—that must be met within a set period for the seller to receive these contingent payments. By linking part of the purchase price to post-closing results, the clause helps bridge valuation gaps between buyer and seller and incentivizes continued strong performance of the business.
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Earn-Out Consideration. (a) If the earnings before taxes (the "EBT") of the Surviving Corporation for the twelve-month period ending on the first anniversary of the Earn-Out Date (the "1999 EBT") exceeds $1,040,000.00 (the "EBT Target"), then the Stockholders shall be entitled to receive one-half of the difference between the 1999 EBT and the EBT Target.
(b) If the EBT of the Surviving Corporation for the twelve-month period ending on the second anniversary of the Earn-Out Date (the "2000 EBT") exceeds the greater of (i) the 1999 EBT and (ii) the EBT Target, then the Stockholders shall be entitled to receive one-half of the difference between (x) the 2000 EBT and (y) the greater of the 1999 EBT and the EBT Target.
(c) The EBT of the Surviving Corporation for the twelve-month periods ending on the first and second anniversaries of the Earn-Out Date shall be computed using generally accepted accounting principles and practices, consistently applied. The allocation of UniCapital overhead shall be made on a pro rata basis applied consistently among UniCapital subsidiaries. To the extent that gain-on-sale treatment was accorded any Lease in any twelve-month period, whether before or after Closing, income from the payment stream on such Lease shall not be included in the EBT of the Surviving Corporation for any subsequent twelve-month period.
(d) The amounts (if any) that the Stockholders become entitled to receive pursuant to Sections 2.4(a) and/or 2.4(b) are referred to herein as the "Earn-Out Consideration." The Earn-Out Consideration shall be paid one-half in cash and one-half in shares of UniCapital Stock (provided, however, that UniCapital may pay up to the entire amount of the Earn-Out Consideration in cash; provided further, that UniCapital will not pay additional cash in an amount in excess of 50% of the Earn-Out Consideration, unless the parties agree, or the Stockholders obtain an opinion of counsel, that such additional payment would not disqualify the transaction under Section 368(a) of the Code). The UniCapital Stock shall be valued at the average of the closing prices per share of UniCapital Stock for the 20 trading days preceding the last day of the twelve-month period to which the portion of Earn-Out Consideration in question applies.
(e) EBT with respect to any twelve-month period shall be determined by PricewaterhouseCoopers LLP within 45 days following the last day of the twelve-month period. The Earn-Out Consideration, if any, shall be paid within 10 business days ...
Earn-Out Consideration. (a) Subject to Section 2.3(c), the Earn-Out Consideration shall be equal to twenty per cent (20%) of the Operating Income in each of Period 1, Period 2, Period 3, Period 4, Period 5 and Period 6, subject to a total maximum Earn-Out Consideration of ¬2,000,000. The Earn-Out Consideration shall also be limited such that the sum of the consideration paid pursuant to Section 2.2 and the Earn-Out Consideration shall not exceed the maximum price set out in Section 2.2(g).
(b) The Earn-Out Consideration for each Earn-Out Period shall be due and payable by the Buyer to the Sellers within thirty (30) days following the agreement or determination of the Operating Income for the relevant Earn-Out Period in accordance with this Section 2.3 and shall be paid by electronic bank transfer to such bank account as the Sellers shall have previously notified to the Buyer in writing. Each Seller shall be entitled to its Relevant Proportion of the Earn-Out Consideration.
(c) Each Seller shall only be entitled to its Relevant Proportion of the Earn-Out Consideration for so long as such Seller remains an employee of the Company or one of the Subsidiaries or provides services under the terms of a service agreement to the Company or one of the Subsidiaries. The entitlement of a Seller to its Relevant Proportion of the Earn-Out Consideration shall not be re-allocated to any other Seller on such Seller ceasing to be an employee of the Company or one of the Subsidiaries or providing services under the terms of a service agreement to the Company or one of the Subsidiaries at the time of payment of the relevant Earn-Out Consideration pursuant to Section 2.3(b).
(d) Following the end of each Earn-Out Period (except for Period 6), Buyer shall instruct the Auditors, as part of their audit of the Buyer, to issue a draft statement setting out the Operating Income for the relevant Earn-Out Period and the amount of Earn-Out Consideration payable to each of the Sellers in respect of that year (the "Draft Earn-Out Statement"). The draft accounts and Draft Earn-Out Statement shall be approved by the audit committee of Buyer. Following the end of Period 6, Buyer shall, in conjunction with the Auditors cause to be prepared a Draft Earn-Out Statement on the basis of the unaudited accounts for Period 6.
(e) Buyer shall deliver the audited accounts (or, in the case of Period 6, unaudited accounts) and the Draft Earn-Out Statement to Sellers' Representative as soon as reasonably practicable and in any ...
Earn-Out Consideration. (a) The Seller shall be entitled to earn additional consideration (the “Earn-Out”) during the Complete Earn-Out Period (as defined below), in an amount up to $1,035,000 in the aggregate payable in cash in accordance with the terms of this Section 1.5 (the “Earn-Out Consideration”).
(b) The followings terms shall have the following meanings for purposes of this Agreement:
Earn-Out Consideration. (a) During the period beginning on the Closing Date and ending on the seven-year anniversary of the Closing Date,
(i) promptly and in any event within 5 Business Days after the first date that the 20-Day VWAP equals or exceeds $14.00, Buyer shall cause the Partnership to issue 10,714,285 Common Units to the Contributor;
(ii) promptly and in any event within 5 Business Days after the first date that the 20-Day VWAP equals or exceeds $16.00, Buyer shall cause the Partnership to issue 9,375,000 Common Units to the Contributor;
(iii) promptly and in any event within 5 Business Days after the first date that the 20-Day VWAP equals or exceeds $18.00, Buyer shall cause the Partnership to issue 13,888,889 Common Units to the Contributor; and
(iv) promptly and in any event within 5 Business Days after the first date that the 20-Day VWAP equals or exceeds $20.00, Buyer shall cause the Partnership to issue 12,500,000 Common Units to the Contributor (each issuance of Common Units pursuant to clauses (i), (ii), (iii) or (iv) above, an “Earn-Out Payment” and all Earn-Out Payments, collectively, the “Earn-Out Consideration”).
(b) In the event that the Partnership shall issue any Common Units in satisfaction of an Earn-Out Payment, Buyer shall issue to the Contributor, a number of shares of Buyer Class C Common Stock equal to the number of Common Units so issued and the Contributor shall separately pay Buyer an amount of cash equal to the number of shares of Buyer Class C Common Stock received multiplied by the par value of such shares. The right to receive the Earn-Out Consideration shall be transferrable on a share-by-share basis by the Contributor to the same extent that the Common Units and shares of Buyer Class C Common Stock received by the Contributor pursuant to this Agreement are transferrable by them; provided that the Contributor and such transferees shall deliver notice to Buyer indicating the Common Units and shares of Buyer Class C Common Stock such transferee may be entitled to receive and an undertaking to indemnify Buyer and its Affiliates in the event of any dispute among any Contributor or any such transferee or other Affiliate of the Contributor or transferee with respect to any such transfer or the Common Units and/or shares of Buyer Class C Common Stock to be delivered in accordance therewith.
(c) Notwithstanding anything to the contrary herein, (i) the Contributor shall not be entitled to receive a particular Earn-Out Payment on more than one occasi...
Earn-Out Consideration. 2.1 As additional consideration for the Sale Shares, the Buyer shall pay to the Sellers (Earn-out Payment) an amount equal to 42.5% of EBITDA in respect of the Financial Period ending on the Reference Date, such payment to be calculated and paid in accordance with the remaining provisions of this Schedule.
2.2 For the purpose of calculating the Earn-Out Payment the Reference Date shall, subject to paragraph 2.3, be 31 July 2018 unless ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ shall elect for 31 July 2016 or 31 July 2017 to be the Reference Date and such election has been made by notice in writing to the Buyer within the 3 month period following either 31 July 2016 or 31 July 2017. For the avoidance of doubt there may only be one Reference Date and one Earn-Out Payment.
2.3 In the event that ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ shall resign as chief executive officer of the Company during the Earn-Out Period then, unless a Reference Date has already been fixed pursuant to and in accordance with paragraph 2.2, the Reference Date shall be the 31 July next following the effective date of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ceasing to be the chief executive officer of the Company.
2.4 Any Earn-out Payment that the Buyer is required to pay pursuant to this Schedule shall be paid to the Sellers in cash in £ sterling within 10 Business Days of the amount of the Earn-Out Payment being agreed or determined in accordance with the provisions of this Schedule. Payment of any Earn-Out Payment in accordance with this clause shall be a good and valid discharge of the Buyer’s obligation to pay the sum in question and the Buyer shall not be concerned to see the application of the monies so paid.
2.5 Except as permitted under paragraph 8 of this Schedule, the Earn-Out Payment shall be paid without deduction set off or counter claim and if not paid in full on the due date the Earn-Out Payment shall bear interest at the rate of 4% per annum above the base lending rate of Lloyds Bank for the time being from the due date until the date of actual payment of the Earn-Out Payment.
Earn-Out Consideration. Subject to certain exceptions, during the period between the Closing and the third anniversary of the Closing, holders of Energy Vault Common Stock and Energy Vault Equity Awards as of immediately prior to the Effective Time are eligible to receive up to 9,000,000 additional Combined Company Common Stock in the aggregate in three equal tranches of 3,000,000 Earn Out Shares, respectively, upon the occurrence of Triggering Event I, Triggering Event II and Triggering Event III, respectively. Additionally, at the Closing, approximately 15,000,000 shares of Novus Common Stock will be issued to the Subscribers upon the closing of the PIPE. Following the consummation of the Business Combination, the Proposed Certificate of Incorporation (as defined in the section titled “Proposal No. 2 — The Charter Proposals”) will be filed with the Office of the Secretary of State of the State of Delaware. For more information about the Business Combination Agreement and the Business Combination, see the sections titled “Proposal No. 1 — The Business Combination Proposal” and “The Business Combination Agreement.” The obligations of Energy Vault, Novus and Merger Sub to consummate the Business Combination, including the Merger, are subject to the satisfaction or waiver (where permissible) at or prior to the Closing of the following conditions: • The Energy Vault Requisite Approval in favor of the adoption of the Business Combination Agreement and the Merger and all other transactions contemplated by the Business Combination Agreement, shall have been obtained; • The Stockholder Proposals shall have been approved and adopted by the requisite affirmative vote of Novus’s stockholders in accordance with the proxy statement/prospectus, the DGCL, the Novus organizational documents and the rules and regulations of NYSE; • The Registration Statement shall have become effective under the Securities Act and no stop order suspending the effectiveness of the Registration Statement shall be in effect and no proceedings for that purpose shall be pending before or threatened by the SEC; • No governmental authority shall have enacted, issued, promulgated, enforced or entered any law, rule, regulation, judgment, decree, executive order or award which is then in effect and has the effect of making the Business Combination, including the Merger, illegal or otherwise prohibiting consummation of the Business Combination, including the Merger; • All required filings under the HSR Act shall have been ...
Earn-Out Consideration. Following the Closing, Purchasers shall pay or cause Newco to pay to APIL the Earn-Out Consideration, in accordance with the terms of Exhibit E.
Earn-Out Consideration. As additional consideration for the Interests (the “Earn-Out Consideration”), the Selling Parties will be eligible to receive up to an aggregate of Five Hundred Thousand Dollars ($500,000) from the Buyers as set forth below:
(a) In the event that the Business achieves 2007 Gross Profit (as defined below) of Five Million Six Hundred Thirty Thousand Dollars ($5,630,000) (such amount, the “Full Target Gross Profit Amount”) or more, Buyers shall pay to the Selling Parties an aggregate of Five Hundred Thousand Dollars ($500,000) as Earn-Out Consideration in accordance with this Section 2.4; provided, however, in the event that 2007 Gross Profit is less than the Full Target Gross Profit Amount, but equal to or greater than Four Million Seven Hundred Eighty Five Thousand Five Hundred Dollars ($4,785,500) (the “Minimum Target Gross Profit Amount”), Buyers shall pay the Selling Parties an aggregate amount equal to Five Hundred Thousand Dollars ($500,000) multiplied by the quotient obtained by dividing (i) the difference between the 2007 Gross Profit and the Minimum Target Gross Profit Amount, by (ii) an amount equal to Eight Hundred Forty-Four Thousand Five Hundred Dollars ($844,500).
(b) Within ninety (90) calendar days following the end of the Earn-Out Period (as defined below), Buyers shall prepare in good faith and deliver to the Selling Parties a schedule showing its calculation of 2007 Gross Profit and a calculation of the corresponding Earn-Out Consideration (the “Earn-Out Schedule”). Within thirty (30) days following receipt by the Selling Parties of the Earn-Out Schedule (the “Earn-Out Review Period”), the Selling Parties shall send written notice (an “Gross Profit Notice of Disagreement”) to Buyers of any objection to the Earn-Out Schedule, specifying in reasonable detail any contested items, the basis therefor and the Selling Parties’ final determination of the 2007 Gross Profit and the corresponding Earn-Out Consideration. The Gross Profit Notice of Disagreement must describe in reasonable detail the items contained in such financial statements or the calculation of 2007 Gross Profit that the Selling Parties disputes and the basis for any such dispute. During the Earn-Out Review Period, Buyers shall provide the Selling Parties and their accountants reasonable access upon reasonable notice to the Park Companies’ relevant books, records, workpapers and personnel during regular business hours for the purpose of verifying the Earn-Out Schedule. If the Selli...
Earn-Out Consideration. (a) The Sponsor, the Company and NAC hereby agree that following the Closing, in addition to the consideration to be received pursuant to the BCA, ParentCo shall be required to issue to the Sponsor an additional One Million Two Hundred Fifty Thousand (1,250,000) ParentCo Common Shares, in the aggregate (the “Earn-Out Consideration”), if any time prior to or as of the second anniversary of the Closing, the VWAP is greater than or equal to Thirteen Dollars ($13.00) over any twenty (20) trading days within any thirty (30) trading day period (the “Earn-Out Target”).
(b) If the Earn-Out Target set forth in Section 5(a) shall have been achieved, within five (5) Business Days following the achievement of the Earn-Out Target, ParentCo shall issue the Earn-Out Consideration to the Sponsor.
(c) If a Change of Control of ParentCo occurs prior to the second anniversary of the Closing and the Earn-Out Consideration that is issuable pursuant to Section 5(a) remains unissued as of immediately prior to the consummation of such Change of Control, the Earn-Out Consideration shall immediately vest and the Sponsor shall be entitled to receive the Earn-Out Consideration prior to the consummation of such Change of Control.
(d) The Earn-Out Consideration and the Earn-Out Target shall be adjusted to reflect appropriately the effect of any stock split, reverse stock split, stock dividend (including any dividend or distribution of securities convertible into ParentCo Common Shares), reorganization, recapitalization, reclassification, combination, exchange of shares or other like change with respect to ParentCo Common Shares, occurring on or after the date hereof and prior to the time the Earn-Out Consideration is delivered to Sponsor, if any.”
Earn-Out Consideration. Subject to the terms and conditions set forth in this Section 3.4(d), if the Parent Trading Price on the Closing Date is less than $10.90 per share, the Stockholder shall be entitled to receive from Parent additional consideration based on the performance of the Company following the Closing in an aggregate amount up to $14,025,000 (the “Maximum Earn-Out Payment”), paid, calculated and determined in the manner set forth in this Section 3.4(d).
(i) If the Company’s EBITDA for the twelve (12)-month period ending December 31, 2024 (the “2024 EBITDA”) exceeds the 2024 EBITDA Target, Parent will pay the Stockholder an amount (the “Earn-Out Payment”) equal to the product of (A) the 2024 EBITDA minus the 2024 EBITDA Target, multiplied by (B) 0.75; provided, however, that in no event shall the aggregate Earn-Out Payment exceed the Maximum Earn-Out Payment. For the avoidance of doubt, if the 2024 EBITDA is less than the 2024 EBITDA Target or the Parent Trading Price on the Closing Date equals or exceeds $10.90 per share of Parent Common Stock, then no Earn-Out Payment will be made. The Earn-Out Payment, if payable, will be paid by Parent to the Stockholder by wire transfer of immediately available funds to an account designated by Stockholder, within five Business Days after the final determination of the 2024 EBITDA as set forth in Section 3.4(d)(ii).
(ii) By the earlier of (A) the date which is fifteen (15) days after the completion of the audit of Parent’s 2024 fiscal year and (B) April 30, 2025, Parent shall (1) prepare or cause to be prepared in good faith (a) the Company’s consolidated statements of income for the year ended December 31, 2024 (the “Earn-Out Financial Statements”), and (b) a statement setting forth in reasonable detail the 2024 EBITDA (as derived from the Earn-Out Financial Statements) and the resulting Earn-Out Payment, if any (collectively, the “Earn-Out Deliveries”), and (2) deliver the Earn-Out Deliveries to the Stockholder.
(A) At any time during the thirty (30)-day period beginning on the date of the delivery of the Earn-Out Deliveries to Stockholder (the “Review Period”), Stockholder may deliver to Parent in writing its objections, if any, to the determinations set forth in the Earn-Out Deliveries (the “Notice of Objection”); provided, such Notice of Objection shall specify the items in the Earn-Out Deliveries disputed by the Stockholder and shall describe in reasonable detail the nature and dollar amount of any disagreement so asserted...