Earn-Out Amount Clause Examples
The Earn-Out Amount clause defines the portion of the purchase price in a business acquisition that is contingent on the future performance of the acquired company. Typically, this clause outlines specific financial targets or milestones—such as revenue or profit thresholds—that must be met within a set period after closing for the seller to receive additional payments. By linking part of the compensation to post-acquisition results, the clause helps bridge valuation gaps between buyer and seller and incentivizes continued strong performance.
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Earn-Out Amount. (a) The Purchaser shall, if the conditions in subsection (b) below are met, pay the Earn Out Amount to the Sellers on September 1, 1999, by wire transfer of immediately available funds to such account as each Seller may reasonably direct by written notice delivered to the Purchaser by such Seller at least three (3) Business Days before September 1, 1999, payable to each Seller in the amount obtained by multiplying the Earn Out Amount by each Sellers' Shareholder Percentage; provided, however, that with respect to any such payment to any Individual Seller which would constitute actual or deemed compensation to such Individual Seller in connection with such Individual Seller's employment with a Company or with respect to which withholding is otherwise reflected in Section 2.03(b) of the Disclosure Schedules, the Purchaser shall withhold from such payment all withholding required in connection therewith under applicable federal and state Tax or other relevant Laws, and such withheld amount shall be deemed for all purposes hereunder to have been paid to such Individual Seller.
(b) The Earn Out Amount shall be payable if the Acquired Businesses, during the twelve (12) calendar month period commencing June 1, 1998 and ending May 31, 1999, achieve an EBIT of $3,923,000 or more and revenues of $19,615,000 or more, both determined in accordance with GAAP as historically implemented by the Target Companies, consistently applied, and both achieved by the operation of the business in a manner not materially inconsistent with the Business Plans, including with respect to research and development and capital and marketing expenditure, except as otherwise provided for the next sentence.
(i) The EBIT shall be determined: (A) without any amortization of goodwill or write up of intangibles associated with the transactions contemplated hereby; (B) without any charge against the Acquired Businesses for any costs associated with the transactions contemplated by this 14 20 Agreement; (C) without any deduction or charge for any deemed compensation attributed to any Individual Seller arising in connection with the sale of the Purchased Stock or Purchased Options to the Purchaser under this Agreement; (D) without any charge against the Acquired Businesses for any general corporate or head office overhead charge by Microdyne; (E) with costs for employee benefits taken into account at whichever is the lower of the per employee (or, where a percentage of salary, at the same percentag...
Earn-Out Amount. (a) In the event that the Earn-Out Baseline has been satisfied during the Earn-Out Period for the first three (3) years from the date hereof, Buyer shall separately pay to each of Kristara and B▇▇▇▇▇, an amount equal to (i) 7.29125% of the percentage of the amount in excess of the Earn-Out-Baseline attributable to Non-Solar Sales when compared to Total Sales (i.e. Non-Solar Sales divided by Total Sales), and (ii) 5.833% of the percentage of the amount in excess of the Earn-Out Baseline attributable to Solar Sales when compared to Total Sales (i.e. Solar Sales divided by Total Sales).
(b) In the event that the Earn-Out Baseline has been satisfied during the Earn-Out Period for any of the years four (4) through five (5) from the date hereof, Buyer shall separately pay to each of Kristara and B▇▇▇▇▇, an amount equal to 5.833% of the percentage of the amount in excess of the Earn-Out Baseline attributable to Solar Sales when compared to Total Sales (i.e. Solar Sales divided by Total Sales).
(c) In the event that the Earn-Out Baseline has been satisfied during the Earn-Out Period for any of the years six (6) through ten (10) from the date hereof, Buyer shall separately pay to each of Kristara and B▇▇▇▇▇, an amount equal to 5.833% of the percentage of the amount in excess of the Earn-Out Baseline attributable to PPA Sales when compared to Total Sales (i.
Earn-Out Amount. (a) Within ninety (90) days after the third anniversary of the Closing Date, Purchaser shall pay to Sellers, as part of the Purchase Price, the Earn-out Amount, if any. The Earn-out Amount shall be that amount determined in accordance with the provisions of Section 2.05(c).
(b) Except as provided in this paragraph (b), the Earn-out Amount shall be payable by the assignment and transfer to Sellers of MuniMae Common Shares having a value based on the Delivery Date Average Share Price equal to or most nearly exceeding the Earn-out Amount then due. If the Delivery Date Average Share Price is less than the Closing Date Average Share Price, then Purchaser, at its sole option and discretion, may pay the Earn-out Amount (i) in cash, (ii) by delivering to Sellers that number of MuniMae Common Shares as has a value based on the Delivery Date Average Share Price as is equal to or most nearly exceeds the Earn-out Amount, or (iii) in any combination of (i) and (ii) above. If on the third anniversary of the Closing Date MuniMae Common Shares are not listed or traded on a national securities exchange or the NASDAQ stock market, Purchaser shall pay the Earn-out Amount in cash. Purchaser shall pay any Earn-out Amount (i) if in cash, by wire transfer in immediately available funds, and (ii) if in MuniMae Common Shares, by transfer, in each case, to such accounts as Sellers shall designate in writing to Purchaser not later than the date which is eighty (80) days after the third anniversary of the Closing Date.
(c) The Earn-out Amount shall be the greater of the amounts calculated in accordance with clauses (i) and (ii) below; provided, however, that for purposes of this Agreement the Earn-Out Amount shall never be less than zero.
(i) Five Million Dollars ($5,000,000) plus the product of (A) (1) the average annual amount of Annual Origination Fee and Premium Income for the Earn-out Period (such average amount not to exceed Five Million Five Hundred Thousand Dollars ($5,500,000)) minus (2) Five Million Five Hundred Thousand Dollars ($5,500,000); and (B) two (2) (the “Primary Calculation Amount”);
(ii) the product of (A) the Primary Calculation Amount and (B) a fraction, the numerator of which is the average of the closing prices per share of MuniMae Common Shares on the New York Stock Exchange for the thirty (30) trading days immediately preceding the third anniversary of the Closing Date and the denominator of which is the Closing Date Average Share Price.
(d) Exhibit A attac...
Earn-Out Amount. (a) Within 60 days following the end of each Earn-Out Period, Purchaser shall prepare and deliver to Agent a statement (each, an "Earn-Out Statement") setting forth:
(i) the Acquired Company Revenue for such Earn-Out Period; and
(ii) the aggregate value of the Earn-Out Amount for such Earn-Out Period, which shall be calculated as follows:
(A) for the 2024 Earn-Out Period (such amount, the "2024 Earn-Out Amount"): 2024 Earnout Amount=Acquired Company Revenue-130,000,00015,000,000×15,000,000 provided that, (x) if the Acquired Company Revenue during the 2024 Earn-Out Period is less than or equal to $130,000,000, then the value of the Earn-Out Amount shall be reduced to nil, and (y) if the Acquired Company Revenue is equal to or greater than $145,000,000, then the aggregate value of the 2024 Earn-Out Amount shall not exceed $15,000,000; and
(B) for the 2025 Earn-Out Period (such amount, the "2025 Earn-Out Amount"): 2025 Earnout Amount=Acquired Company Revenue-145,000,00015,000,000×15,000,000 provided that, (x) if the Acquired Company Revenue during the 2025 Earn-Out Period is less than or equal to $145,000,000, then the value of the Earn-Out Amount shall be reduced to nil, and (y) if the Acquired Company Revenue is equal to or greater than $160,000,000, then the aggregate value of the 2025 Earn-Out Amount shall not exceed $15,000,000. An illustrative example of the calculation of the Earn-Out Amount is set forth on Part B of Exhibit D.
(b) Within 30 days of receipt of an Earn-Out Statement, Agent may notify Purchaser in writing of any objections it may have to such Earn-Out Statement and/or the calculations set forth therein, which objection notice will set forth a description of the nature and basis for each of the disagreements. During such 30-day period, ▇▇▇▇▇▇▇▇▇ agrees to cause the Acquired Companies to provide Agent and its advisors with access to all work papers of Purchaser and the Acquired Companies' auditors, the Books and Records and supporting schedules as they relate to such Earn-Out Statement and the appropriate personnel to verify the accuracy, presentation and other matters relating to the preparation of such Earn-Out Statement. Agent shall be deemed to have accepted such Earn-Out Statement and the calculations set forth therein if Agent does not notify Purchaser of any objection in a written notice within such 30-day period. #110828415
(c) If Agent disputes an Earn-Out Statement in accordance with Section 2.10(b), then Agent and Purchaser will...
Earn-Out Amount. For a three (3) year period following the Closing Date, (the "Earn Out Period"), Buyer shall pay to the Company (in accordance with Exhibit A) ten percent (10%) of the amount of the increase in contribution profit of the Business over the Baseline Amount based on the sale of the Company's products (the "Earn Out Amount") commencing on the first day of the month following the Closing Date and ending on the last day of the twelfth (12th) month thereafter and continuing on each consecutive twelve (12) month period thereafter for a period of three (3) years (the "Yearly Earn Out Period"). The contribution profit shall be determined by calculating the gross sales of the Company's products less cost of goods sold, direct product promotional expenses, discounts, allowances, product returns, coupons, rebates, commissions and freight (the "Earn Out Calculation"). The "Baseline Amount" is $2,000,000. In determining the contribution profit of the Company, there shall be no allocation of Buyer's general and administrative expenses.
Earn-Out Amount. Earn out means an amount in cash equal to the amount determined pursuant to one, but only one, of the following clauses (a) through (c):
(a) If in any 12 months period 1st April to 31st March EBITDA is equal to or the Earn out Period is equal to or less than $10,000,000, Zero Dollars;
(b) If in any 12 months period 1st April to 31st March EBITDA is equal to or the Earn out Period is greater than $10,000,000 but less than $40,000,000, an amount equal to $25,000,000 plus the product of (X) 2.5 and (Y) the amount by which EBITDA exceeds $10,000,000;
(c) If in any 12 months period 1st April to 31st March EBITDA is equal to or the Earn out Period is equal to or greater than $40,000,001, an amount equal to $50,000,000 plus the product of (X) 2.5 and (Y) the amount by which EBITDA exceeds $40,000,001; Earn out Period means a period of 10 years calendar period beginning on April 1, 2014 and ending on March 31, 2023. Earn out will be settled on a yearly basis.
Earn-Out Amount. On the later of (i) 75 days after the last day of the Earn-Out Period and (ii) two Business Days after the determination of the Earn-Out Amount pursuant to Section 3.10(d), HoldCo will automatically, and without further action by HoldCo, be entitled to receive consideration equal to, and Buyer shall pay to HoldCo, or to Persons specified by HoldCo in proportion to their ownership of HoldCo at the time of Closing, the Earn-Out Amount, if any, subject to any deposit of the Funded Amount pursuant to Section 3.7(d) and any recoupment and offset pursuant to Section 12.10.
Earn-Out Amount. 1.6.1 If prior to the first anniversary of the Closing, DoveBid enters into the second of at least two "Significant Flow Agreements" (as defined in Subsection 1.6.2) where each such Significant Flow Agreement "Results from the Efforts of the Shareholders" (as defined in Subsection 1.6.3), then DoveBid shall pay $500,000 in two installments each of $200,000 to ▇▇▇▇▇▇▇▇ and $50,000 to ▇▇▇▇▇, respectively, the first of which shall be paid on the execution of the second Significant Flow Agreement and the second of which shall be paid on the one year anniversary of the Closing.
Earn-Out Amount. The Earn Out Amount is the amount determined in accordance with the following calculations:
(a) The Incremental Sales Increase amount is to be multiplied by 50% and further multiplied by the Ownership Fraction, but in no event will such amount exceed an amount equal to $2,435,400 multiplied by the Ownership Fraction.
(b) The Earn Out Amount will be payable as soon as the Incremental Sales Increase can be reasonably determined by the Buyer’s Auditor as set forth below but in no event prior to the date of Buyer’s Auditor’s report related to the consolidated financial statements of the Buyer for the year ending December 31, 2010 that are included in Buyer’s Form 10-K and filed with the U.S. Securities and Exchange Commission for such year.
(c) For illustrative purposes only, the calculation of the Earn Out Amount is illustrated as follows (all figures are in US Dollars):
(i) 2010 Company Sales - $9,000,000 · $9,000,000 $4,616,280 · $4,616,280 x 50% x 35,202,812/50,917,097 = $1,595,790 · Maximum amount of earn out is: $2,435,400 x 35,202,812/50,917,097 = $1,683,836 · Earn Out Amount is $1,595,790
(ii) 2010 Company Sales - $10,000,000 · $10,000,000 $ 5,616,280 · $5,616,280 x 50% x 35,202,812/50,917,097 = $1,941,548 · Maximum amount of earn out is: $2,435,400 x 35,202,812/50,917,097 = $1,683,836 · Earn Out Amount is $1,683,836
(d) In the event the consent by the Commonwealth of Australia acting through the Department of Innovation, Industry, Science and Research (the DIISR) is not received with respect to the financial grant to the Company by DIISR and any portion of the DIISR grant must be repaid by the Company to DIISR, then the Earn Out Amount will be reduced by an amount equal to the amount of the DIISR grant repaid or required to be repaid.
(e) The Earn Out Amount will be provided in cash or Buyer Shares or any combination thereof at the Buyer’s discretion (provided, however, the Buyer will give good faith consideration to the combination of cash and/or Buyer Shares to be provided in payment of the Earn Out Amount as requested by the Sellers), and the number of Buyer Shares, if any, to be furnished in payment of the Earn Out Amount will be determined and based on the volume weighted average price of the Buyer’s common stock on the Nasdaq Global Market during the 20 trading sessions that end on the day of the date of the Buyer’s auditor’s report related to the consolidated financial statements of Buyer for the year ending December 31, 2010 that are included ...
Earn-Out Amount a. The Buyer agrees to pay to the Seller an additional amount equal to the "EARN OUT AMOUNT" determined pursuant to and in accordance with this Section 2.5. The total maximum Earn Out Amount will be an aggregate amount equal to U.S.$3,000,000. The maximum Earn Out Amount does not include the "EARN OUT BONUS".
b. The Earn Out Amount will be paid by the Buyer to the Seller on or before 120 days following each of December 31, 1998, December 31, 1999 and/or December 31, 2000. If the maximum Earn Out Amount is earned prior to the end of any of such yearly periods, the maximum Earn Out Amount will be paid in full at the date that it has been earned in full.
c. The Earn Out Amount will be determined based on the following formula: (i) the audited net income after income tax of the Company for each of the calendar years 1998, 1999, and 2000, minus (ii) U.S.$1,250,000 for each calendar year 1998, 1999, and 2000. If the income tax in any or all of calendar years 1998, 1999 or 2000 exceeds 25% of net income before tax, then the income tax rate will be reduced to 25% of income before tax for any income that is taxed at a rate that is greater than 25%. If the audited income tax rate is less than 25%, then the lower audited number will be used. (Accordingly, for purposes of calculating the Earn Out Amount the income tax rate that will be applied to the Company's taxable income will be the lesser of 25% or the actual audited income tax rate that is applied to the Company's taxable income for 1998, 1999 and 2000). If the audited net income for a year is a loss, the loss will not be carried over to a subsequent year. For example and illustration purposes only, the following chart shows the Earn Out Amount that would be payable if the assumptions in the illustration were achieved by the Company: Calendar Year Calendar Year Calendar Year 1998 1999 2000 -------------------------------------------------------------------------------- Audited Net US$2,000,000 US$1,250,000 US$3,250,000 Income of Company for the Calendar Year -------------------------------------------------------------------------------- Annual $1,250,000 US$1,250,000 US$1,250,000 US$1,250,000 base amount -------------------------------------------------------------------------------- Annual Amount US$750,000 - 0 - US$2,000,000 Payable -------------------------------------------------------------------------------- Cumulative US$750,000 US$750,000 US$2,750,000 Payment --------------------------------------------...