M&A Foundations · glossary
Any part of the price paid after completion, whether on fixed later dates or when conditions are met. Simple to draft, but it leaves the seller exposed to the buyer's ability (and willingness) to pay later. Chapter 9
Explained in Chapter 9, Price Mechanisms and Adjustments, of M&A Foundations.
The last family of tools is about when the price is paid and how claims get funded, not how it is calculated. An escrow puts part of the price into a joint account with an escrow agent, usually a bank or the lawyers. That part of the price is released to the seller on agreed dates unless the buyer has notified claims. A retention is the same idea without the agent: the buyer simply holds part of the price back. Deferred consideration is different again: part of the price is…Read Chapter 9, Price Mechanisms and Adjustments →
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