b"SEQUEL LISETTE VAN GILSIN TIMES OF UNCERTAINTY, THERE IS A'An earn-out GREATER FOCUS ON RISK MANAGEMENT.Van Gils: 'Due to uncertainties on the politicalarrangement and economic world stage, there was less M&A activity across the entire Dutch SME market incomes with 2022 compared to the previous record years. As a result, we have noticed a shift in the attentionadditional risks of buyers, and entrepreneurs have become more cautious. During the sales process, there is nowfor the seller; we more focus on due diligence investigations and suspensive or dissolving conditions. For sellers,prefer 'cash on the it is now more important than ever to clearly outline the steps in the sales process beforehand,nail''in order to maintain maximum control over the sales trajectory. The more certainty a buyer can provide early on in the process, the better their position compared to other buyers, even if others may offer a higher price. Deal certainty has become increasingly crucial.'investors willing to take minority stakes instead CREATIVE DEAL STRUCTURES of majority ownership. This requires even more Van Gils continues: 'We also see that buyers arecustomized contractual arrangements. As private incorporating more creative deal structures inequity funds often work on behalf of large parties their offers. To increase financing possibilities,such as pension funds and insurers, a high degree vendor loans and earn-out arrangements areof professionalism and speed is expected. Since being used more frequently. Especially in suchthey pursue returns, their requirements largely transactions, as a lawyer, one must remain vigilantrevolve around financial certainties. Additionally, and ensure that a seller is still able to achievethey are focused on guarantees and agreements maximum (earn-out) results even after an initialthat can impact cash flow. As a result, the sense of closing. In an earn-out structure, it is importanturgency regarding solid contracts has significantly to establish achievable and realistic performanceincreased. A few years ago, entrepreneurs used to objectives and ensure that the earn-out is basedsay that a contract could fit on one page, but now on the part of the results where the seller hasI rarely hear that, thankfully,' says Van Gils.sufficient influence and leverage. An earn-out arrangement carries additional risks for the seller, and we prefer immediate payment. If that is not possible, it is important to legally document the consequences as well as possible.' THE INFLUENCE OF PRIVATE EQUITY ON ACQUISITION CONTRACTS'Private equity has experienced significant growth in recent years and is now an integral part of the SME market. Increasingly, we see private equity 66 BHB DULLEMOND"