Meaning of earn-out in English:



  • A provision written into some financial transactions whereby the seller of a business will receive additional payments based on the future performance of the business sold.

    ‘Bravura will pay an initial 19.2 million to acquire Rufus with two further payments dependant on agreed earn-out thresholds.’
    • ‘He will leave the agency at the end of February following the expiry of an earn-out clause.’
    • ‘Instead of being profits related, your earn-out will become totally sales related.’
    • ‘They were concerned this could affect their chances of obtaining the earn-out.’
    • ‘A big chunk of any earn-out would have to be spread out beyond the end of those contracts.’
    • ‘For achieving net monthly sales above £ 130,000 up to £ 180,000, you will be paid an earn-out of 20 % of net sales.’
    • ‘A spokesman for Adaptec would not comment on when, or if, the earn-out payments would be made.’
    • ‘The employment was also clearly to allow the plaintiff and the former shareholders of PPI to work on the earn-out.’
    • ‘More tech executives are expected to lose out as earn-out clauses are renegotiated by previously booming tech firms.’
    • ‘If they were to leave following completion of the deal they would presumably lose some of those earn-out rights.’
    • ‘However, it is understood that most of the purchase price was in Agilent stock, with an earn-out period of at least one year.’
    • ‘The share buyouts are subject to lock-up and earn-out clauses that mean shares cannot be cashed in for a fixed period.’
    • ‘If the definitive agreement includes earn-out provisions, monitoring these provisions may require more of your time.’
    • ‘All were greatly enriched by earn-out payments.’
    • ‘The owners would prefer an all-cash deal and will consider a deal that features an earn-out.’
    • ‘The maximum earn-out payable is £ 250,000 (the same maximum as in the Agreement).’
    • ‘The earn-out deal specifies a minimum price of £ 4m and a maximum of £ 9m.’
    • ‘With an earn-out, you'll get additional payments after the official sale - but only if the business hits certain targets.’
    • ‘One useful tool is to formulate an earn-out period after the acquisition is completed.’
    • ‘Tricky earn-out clauses are said to be delaying the finalisation of the deal, but other factors are also at play.’