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Negotiating Earnouts in M&A Transactions: Effective Approaches to Bridging the Valuation Gap

Structuring Clauses to Protect Buyers and Sellers and Reduce Post-Closing Disputes

Recording of a 90-minute premium CLE video webinar with Q&A

This program is included with the Strafford CLE Pass. Click for more information.
This program is included with the Strafford All-Access Pass. Click for more information.

Conducted on Wednesday, February 21, 2024

Recorded event now available

or call 1-800-926-7926

This CLE course will guide deal counsel in negotiating and structuring earnout clauses in M&A agreements that benefit buyers and sellers and reduce the likelihood of post-closing disputes.


M&A transactions routinely include earnout provisions as a valuation-bridging mechanism to alleviate concerns by both parties about tendering or receiving a fair purchase price.

While earnouts are a beneficial tool for parties in M&A deals, provisions governing earnouts are complicated and often defer disagreements during the negotiation of the deal price to post-closing disputes over the earnout itself.

Counsel must draft explicit, specific, business-contextualized provisions and procedures relating to the calculation of the earnout and the parties' respective obligations.

Listen as our authoritative panel explains recent trends in the use of earnouts, the pros and cons of including them in M&A deals, and strategies for structuring earnout terms in a way that benefits and protects both buyers and sellers.



  1. Earnouts
    1. Advantages and disadvantages of earnouts
    2. Relevant performance benchmarks
    3. Current market trends
  2. Structuring earnout provisions
    1. Drafting earnout terms to minimize disputes
    2. Addressing how the buyer must control the business
    3. Tax implications
    4. Drafting effective dispute resolution provisions


The panel will review these and other challenging issues:

  • What approaches are effective in negotiating performance benchmarks for deals involving earnout provisions?
  • Current market trends
  • What post-closing concerns should buyers and sellers anticipate and address during deal negotiations?
  • What are the tax issues that counsel must understand and consider regarding earnouts?


Cenkus, Brett
Brett A. Cenkus

Cenkus Law

Mr. Cenkus focuses his practice on business law, and serves as a consultant to startups. He has extensive experience in...  |  Read More

Lavallee, Gena
Gena Lavallee

Of Counsel
McLane Middleton

Ms. Lavallee is an experienced corporate attorney with a demonstrated history of mergers and acquisitions execution in...  |  Read More

McMahon, Michael
Michael McMahon


Mr. McMahon has extensive experience, both at the firm and as a former Department of Justice trial attorney,...  |  Read More

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