Accounting fluency
The dispute is argued in the SPA's defined terms — EBITDA bridges, policy hierarchies, ordinary course — not in generalities.
M&A & earnout disputes
The deal closed. The price is still being fought over.
Aun & Co. litigates post-closing M&A disputes in Israel: earnouts, completion accounts, warranty claims and holdback releases, for buyers and sellers.
Most M&A disputes are really accounting disputes wearing contract language: an earnout that missed its target because the buyer changed how the business runs, completion accounts prepared under conveniently chosen policies, warranty claims priced by hindsight. The battleground is the SPA's definitions — of EBITDA, of ordinary course, of what the seller disclosed. The firm litigates these as document cases, where the deal file and the post-closing management record decide who is right.
The work spans
- Earnout claims: missed targets, changed operations, starved businesses
- Completion-accounts and price-adjustment disputes and expert referrals
- Warranty and indemnity claims — prosecution and defence
- Holdback and escrow release fights
- Disputes over post-closing covenants and non-competes
- Your earnout period ended just under target after the buyer merged your unit into another.
- Completion accounts arrived with policy choices that swing the price by millions.
- A warranty claim landed on the last day of the period, priced with full hindsight.
- Escrow release is due and the buyer has produced a new list of objections.
The firm reads three records against each other: the SPA as signed, the disclosure exercise as actually run, and the business as actually operated after closing. Earnout cases turn on the third — board packs, budgets and management decisions that shifted revenue or cost across the measurement line. The expert-determination clause is assessed at the outset, since it often controls the forum and the timetable more than either side expects.
04 · What you get
Forum clause decoded
Expert determination, arbitration or court: the firm establishes early which track binds you and shapes strategy to it.
The management record mined
Post-closing board papers and budgets are where earnout manipulation shows; the firm knows what to demand and where to look.
The firm has acted where a seller's earnout depended on divisional results and the buyer, post-closing, reallocated key customers to a sister unit. The engagement centred on the ordinary-course and good-faith operation covenants, and on rebuilding the counterfactual results from the buyer's own reporting.
Described in abbreviated, anonymised form to preserve client confidentiality.
Can a buyer's post-closing conduct defeat its earn-out defence?
Often, yes. Where the SPA obliges the buyer to run the business in the ordinary course or in good faith toward the earnout, operational changes that suppressed the metric can ground a claim for the payment the target would have produced.
Are completion-accounts disputes decided by courts or experts?
Usually by the mechanism in the SPA — commonly an independent accountant acting as expert, whose determination is final on the accounting items. Courts step in mainly at the edges: scope, procedure and manifest error.
How long do warranty claims survive after closing?
As long as the SPA says — contractual limitation periods and caps generally govern, and notice requirements are enforced strictly. The practical rule: diarise the periods at closing and treat notice formalities as jurisdictional.