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Facilitator Guide

Earn-Outs and Other M&A Payment Structures (UK)

What’s covered

  • Lump sum payments
  • Deferred consideration
  • Earn-outs and milestone payments
  • Escrows and retentions
  • Hybrid structures

Before the session

Prepare the Attendees

Send the attendees an invitation for the session. Include this link, which has the videos and exercise they’ll need to prepare.

https://www.hotshotlegal.com/discussions/earn-outs-and-other-m-a-payment-structures-uk/attendee

Prepare Yourself

Watch the videos and read the exercise so you’re familiar with the Hotshot material.

  • still frame from Earn-Outs and Other M&A Payment Structures (UK)

    Course

    Earn-Outs and Other M&A Payment Structures (UK)

    An overview of common payment structures in M&A transactions, including lump sum payments, deferred consideration, earn-outs, milestone payments, and hybrid arrangements. The course explains when each structure makes commercial sense and practical considerations for both buyers and sellers.

  • Icon of a document

    Exercise

    PDF

During the session

Part 1: Knowledge Check
 
Ask attendees these questions to ensure they understand the topic:
  • How can a transaction’s payment structure help bridge the gap between a buyer’s and seller’s valuation expectations?
  • Which situations naturally push toward lump sum payments?
  • What is deferred consideration? How does it differ from a holdback or escrow?
  • How do escrow and retention arrangements protect buyers? What are the trade-offs for sellers?
  • What are some advantages of combining multiple payment mechanisms in a hybrid structure?
 
Part 2: Group Exercise
 
Lead a group discussion based on the exercise. To encourage collaboration, divide the attendees into groups to discuss the exercise, then have a representative from each group summarise their views to the larger group. Call on people to share their thoughts and ask others to respond.
 
Tip for remote sessions: use your web conferencing system’s breakout room feature to divide people into groups.
 
Part 3: War Stories and Firm Specifics
 
Share your own experiences and guidance, including:
 
  • Anecdotes and war stories (e.g., about a near-disaster or a tough negotiation)
  • General practice tips (dos and don’ts)
  • Firm-specific guidance and practices

After the session

To continue their learning, attendees can check out related courses in Hotshot’s M&A Basics (UK) topic.