M&A Earnouts and Retention Agreements

Shermin Kruse Adjunct Professor at Northwestern University's Pritzker School of Law

This M&A Master Class provides a practical review and points to a range of recent transactions for guidance on designing an optimal structure. The key considerations are unpacked with a thorough look at the legal, financial, and human capital considerations associated with contingent consideration mechanisms and various retention structures.

  • Conceive and produce earnout structures that align with the deal objectives
  • Engineer retention agreements for key talent on both sides of the transaction
  • Produce an environment that drives integration milestones and value creation

$1,500 | $0 for Members Learn About Membership Accounts

Friday, October 3, 2025 | 10:00 - 3:30 (CST)

Live Online

Earnout Formulations

  • Tailoring earnout agreements to align with M&A objectives
  • Types of earnout structures and their advantages and disadvantages
  • Key considerations in determining earnout metrics and operational control
  • Connecting earnout agreements with other provisions in the M&A agreement
  • Common challenges and risks associated with earnout structures and triggers
  • Methods for ensuring earnout payments are appropriately structured and paid
  • Provisions for dispute resolution, claw backs, and claims adjudication

Contingent Value Rights 

  • Using CVRs to bridge valuation gaps and win shareholder support
  • Setting time frames for achieving performance milestones and payouts
  • Modeling the range of possible outcomes and impact on the transaction
  • Linking contingent consideration to the transaction’s value drivers
  • Adjustment mechanisms for market and regulatory disruptions
  • Selecting a calculation methodology and independent auditor
  • Common challenges and risks in framework design

Retention Agreements

  • Approaches for identifying key employees for retention
  • Understanding cultural variations that may impact global transactions
  • Techniques for employing tactical empathy to improve negotiations and retention
  • Legal and ethical parameters for retention agreements
  • Determining maximum retention funds and 'at market' ratios to deal value
  • Tax implications and considerations for the company and employees
  • How to optimally structure payment triggers

The Institute is an accredited provider of CLE in Illinois. This M&A Master Class offers 4.75 CLE credits. An Illinois certificate will be issued. If you are licensed in another state, please check for reciprocity regarding continuing education credits.


Shermin Kruse Adjunct Professor at Northwestern University's Pritzker School of Law

Professor Kruse teaches a course on global transactions and serves as a corporate director and advisor on issues including international growth, complex negotiation, leadership, and professional development. She is the author of the textbook, “Global Transactions and Regulation”.

Earlier she was a partner at the law firm of Barack Ferrazzano where she represented companies in a range of complex negotiations and global transactions.

She has been teaching for the Institute since 2023.

“This M&A Master Class helped me gain an understanding of the different type of earnouts especially CVRs."

Mergers Acquisitions and Divestitures Project Manager

Hewlett Packard Enterprise

Senior Manager

American Axle & Manufacturing

"This M&A Master Class provided a logical review and discussion of relevant case studies, while being easy enough to understand for someone with minimal M&A experience."

Senior Director of M&A

Dentsu International

"Great M&A course that covered the basics of Earnouts and Retention Agreements - along with some practical advice in implementing both.”

Director, Mergers & Acquisitions Finance

Microsoft

"The M&A Master Class led by Shermin Kruse was a great session to dive deep into what to consider when thinking through earnouts and retention. "

General Manager of Business Process

Steel Technologies

"I would recommend this M&A Master Class to anyone on a Corporate Development team or a Leadership team within an organization."

Director, Corporate Development

Sony

"The best aspect of this master class was the discussion throughout, hearing about examples that others have experienced. Even if the industry was vastly different, it was good to see commonalities in the deal process and how those examples could be applied to our own deals."

Senior Associate, Corporate Development

Sproule

"This master class provided invaluable insights into structuring earnouts and aligning them with strategic objectives. The practical case studies and deep dives into topics like integration planning and customized metrics were both engaging and highly applicable. It's a must for professionals looking to enhance their expertise in M&A."