Earnout defined: An earnout is a portion of the purchase price that is contingent on future performance. It is payable to the seller after certain predefined levels of sales and/or income are achieved in the years after the sale. (Also see “Contingency Payment”)

Above is a definition for “Earnout” from PrivCo’s Private Company Knowledge Bank, the definitive online and e-book guide to private companies and private company deals.

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