Earnouts are risky, especially when your buyer has a pre-existing competitive business. M&A Stories December 6, 2024 In 2019, a seller of athletic event registration software agreed to sell its assets to a buyer in the same industry. The transaction…
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The Risks of Earnouts with Buyers Who Compete
Posted in problems with earnouts Tagged with: asset purchase agreement disputes, athletic event software industry, business acquisition legal risks, buyer conflict of interest, commercial reasonableness in M&A, competing businesses in acquisitions, Delaware court decisions, Earnout agreements, M&A legal disputes, post-closing obligations, protecting seller earnouts, revenue diversion, seller risks in M&A, small business M&A challenges
Buyer-Friendly Earnout Provision Shields Buyer from Seller’s Claim
This blog dives into a key M&A case from the Delaware Court of Chancery that underscores the importance of earnout clauses in asset acquisition deals. It centers on a $1.7 million acquisition in the data management sector, where the buyer…
Posted in problems with earnouts Tagged with: acquisition terms in M&A, asset acquisition case, buyer discretion in M&A, buyer-friendly earnout provision, buyer’s interests in acquisitions, Delaware Court of Chancery, earnout clause interpretation, earnout clause protection, M&A case study, M&A legal disputes, M&A legal strategies, Post-closing disputes, protective M&A terms, revenue-based earnouts, Seller Claims, Walmart contract data management
Earnouts: The Importance of Clear Buyer Obligations
This blog explores the complexities of earnout structures in M&A deals, emphasizing the need for sellers to negotiate clear post-closing obligations. Using a real-life Delaware court case, the post highlights how vague earnout terms can lead to disputes and legal…
Posted in problems with earnouts Tagged with: acquisition contract disputes, Breach of contract in M&A, buyer obligations in acquisitions, commercial reasonable efforts in earnouts, Delaware court M&A rulings, earnout litigation, earnouts in acquisitions, implied covenant of good faith, M&A Disputes, M&A Legal Cases, post-closing obligations, purchase agreement obligations
Delaware Court Awards Over $1 Billion in Earnout Dispute Over Surgical Robot Milestones
This blog covers a Delaware Court of Chancery case involving a $1 billion earnout dispute over FDA milestones in the acquisition of a surgical robotics startup. The post highlights key legal issues such as earnout provisions, commercially reasonable efforts obligations,…
Posted in problems with earnouts Tagged with: and corporate fraud in M&A, Commercially reasonable efforts, competing products, Delaware Court of Chancery, earnout dispute, FDA approval, implied covenant of good faith, M&A litigation, Medical device acquisition, merger agreement, post-closing litigation, regulatory milestones, surgical robots, venture-backed startups
M&A Buyer’s Earnout Risk
Explore the complexities of M&A transactions with a deep dive into the legal battles surrounding earnouts. This post dissects a real-world case involving a $226 million acquisition in the insurance industry, where the buyer alleges overpayment due to fraudulent earnout…
Posted in problems with earnouts Tagged with: acquisition agreement compliance, acquisition financial targets, Breach of contract in M&A, buyer earnout risk, Earnout disputes, earnout structuring, federal district court M&A cases, financial misrepresentation, fraud in mergers and acquisitions, good faith in business deals, insurance brokerage M&A, legal implications of earnouts, legal strategies in M&A, M&A case studies, M&A deal risk management, M&A industry insights, M&A legal issues, M&A litigation, PCF Insurance Services case, Post-closing disputes, private equity acquisition
Resolving M&A Seller Earnout Disputes: Beyond Accountant Arbitration
Delve into the intricacies of M&A earnout disputes with our latest blog post. Explore the complexities beyond accountant arbitration, as we dissect a notable case and offer insights into drafting M&A agreements for clarity and foresight. M&A Stories May 9,…
Posted in problems with earnouts Tagged with: accountant arbitration, business law, business negotiations, business strategies, Buyer-Seller Agreements, commercial AV projectors, contract drafting, contractual language, COVID-19, dispute resolution, Earnout Calculation, Earnout disputes, Industry specifics, Kelly v. DCC Technology Holdings Inc., Legal aspects, legal insights, M&A, M&A agreements, Mergers and Acquisitions, pandemic implications, post-closing metrics, revenue metrics, stakeholder insights, valuation discrepancies
Challenging a M&A Buyer’s Good Faith in an Earnout Dispute
Explore the intricacies of M&A earnouts and legal disputes in this compelling blog post dissecting the Butler v. Ferguson Enterprises Inc. case. Gain valuable insights into contract negotiations, operational matters, and the pivotal role of judicial scrutiny in post-closing disputes.…
Posted in problems with earnouts Tagged with: Business acquisitions, business continuity, business law, business strategies, Butler v. Ferguson Enterprises Inc., Buyer-Seller Agreements, CFO insights, Cincinnati, contract law, contract negotiations, Earnout disputes, earnouts, Entrepreneurship, judicial scrutiny, legal cases, Legal Challenges, Legal Disputes, legal implications, legal insights, legal recourse, Litigation, M&A, Mergers and Acquisitions, operational matters, operational performance, Post-closing disputes, profitability, stakeholder management
Navigating Earnout Disputes in M&A: Insights from Dolce v. WTS International, LLC
Delve into the intricate world of M&A earnouts with insights from the landmark Dolce v. WTS International, LLC case. Explore the complexities and risks involved in earnout disputes, including the crucial role of EBITDA calculations. Gain valuable lessons on navigating…
Posted in problems with earnouts Tagged with: Business owners, Business Transactions, Case Study, contract law, Corporate transactions, Delaware Court of Chancery, Dolce v. WTS International LLC, Earnout disputes, EBITDA calculation, Entrepreneurial insights, expert determination, financial scrutiny, industry analysis, legal complexities, Legal Disputes, Legal Precedents, legal proceedings, Litigation, M&A, Mergers and Acquisitions
Navigating M&A Earnout Disputes: A Lesson from Nomar Enterprises, LLC v. Rugged Solutions America, LLC
Explore the intricate world of M&A transactions through our latest blog post, ‘Navigating M&A Earnout Disputes: A Lesson from Nomar Enterprises, LLC v. Rugged Solutions America, LLC.’ Uncover the strategic use of earnouts, the risks they pose for both buyers…
Posted in problems with earnouts Tagged with: asset purchase agreement, Breach of contract, Business acquisition, case reference, Court proceedings, dispute resolution, earnouts, EBITDA metrics, financial metric disputes, fraud claims, Houston federal district court, independent accountant, Industry Insights, Legal Blog, Legal Disputes, Legal lessons, M&A Risks, M&A Transactions, Nomar Enterprises LLC v. Rugged Solutions America LLC, rugged computer industry, strategic management
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