EARN-OUT OR BURN-OUT?
This article is co-authored by Ryan McMaster and Richard Hoare. The recent Court of Appeal decision of Malthouse Ltd v Rangatira Ltd [2018] NZCA 621 serves to highlight the risks of using earn-out clauses in M&A transactions. What is an ‘Earn-out’ clause? Earn-out clauses are a relatively popular mechanism used in M&A deals as a…