RockyMountain Posted December 14, 2020 Share Posted December 14, 2020 Hello, My company I work for is currently undergoing asset purchase. In the company there are number of employees fully vested in Stock Appreciation Rights. In our case buyer will payout all debt and wants specific amount of left over proceeds to be paid as an earn-out based on company performance in the next year. My questions is how Stock Appreciation Rights should be treated in case like this? Do you pay them out in full or they become part of earn-out. This is a bit confusing since company is doing asset purchase rather than stock buy. Any advice is much apricated. Link to comment Share on other sites More sharing options...
Bob the Swimmer Posted December 15, 2020 Share Posted December 15, 2020 What does the SAR plan say ? I have not seen them be part of an earn-out, but earn-outs are increasing according to surveys due to the volatile economy. Link to comment Share on other sites More sharing options...
Luke Bailey Posted December 16, 2020 Share Posted December 16, 2020 RockyMountain, I think Bob the Swimmer is correct that the plan language would be important, but in general this can be done either way you can do either way. It looks like here they want the employees to have similar terms to the investors, which may make sense, but every deal is somewhat different. Luke Bailey Senior Counsel Clark Hill PLC 214-651-4572 (O) | LBailey@clarkhill.com 2600 Dallas Parkway Suite 600 Frisco, TX 75034 Link to comment Share on other sites More sharing options...
RockyMountain Posted December 16, 2020 Author Share Posted December 16, 2020 Thank you Bob the Swimmer and Luke Bailey, Link to comment Share on other sites More sharing options...
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