earn out

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earn out

verb bring to a zero balance, bring up to date, defray the expenses, lend, loan, paid back, pay back after an advance, repayment, used upGenerally: indemnify, recoupment, reimburse, remit
References in periodicals archive ?
An additional $50 million in potential cash and stock earnout payments may be payable to Hu-Friedy shareholders upon achievement of certain commercial milestones in the eighteen months following closing of the transaction.
Cantel is acquiring Hu-Friedy for $725 million in upfront cash and stock consideration, and up to $50 million in earnout payments payable in cash and stock conditional.
The company noted that the net loss for this year's first quarter includes a non-cash charge of USD13.3m related to an increase in fair value of the earnout liability assumed in connection with eHealth's acquisition of GoMedigap.
To bridge the valuation gap, many businesses use an earnout. Earnouts have several advantages: They allow buyers to pay part of the purchase price only if certain goals are met, they allow sellers to receive a higher transaction value when the business performs to their expectations, and they motivate key employees to stay involved with the continued operation of the business.
An additional earnout of EUR9.5m can be paid each year for three years from 2018 to 2020 tied to the company's performance.
As disclosed in the Company's May 17 press release, CHEM will pay up to $6.1 million, including $3 million which was paid today on closing, and an additional earnout of up to $3.1 million based on certain sales objectives during an 18-month earnout period.
The consideration also includes a potential earnout payment of up to USD137.9 million payable in cash or Bankrate stock and up to USD7.8 million in cash or time-based vesting restricted stock units based on the NextAdvisor business unit achieving certain growth targets over the 18-month period following the closing of the transaction.
As a result, a portion of the consideration for the business--the "earnout"--may be based on a seller's willingness to provide a level of service that results in the transfer of the business interest and relationships to the buyer.
When there is a difference in valuation but both parties desire to get the deal done, an earnout may be used to bridge the gap.
Owner open to $25,000 down payment and earnout over time.See presentation report for more details.
Sometimes this is referred to as an "earnout." This type of contingent consideration often results when an acquirer and acquiree cannot completely agree on an acquisition price.
An earnout provides a mechanism to tie a portion of the purchase price to future performance.