Assess whether earnout definitions will cause a post-close fight (133ac2)

Situation

A Phase II that found groundwater impact put related-party revenue that disappears at close in front of carve-out separation lead in a PE platform evaluating a founder-led SaaS add-on. This M&A Due Diligence / Separation and Integration close is earnout definitions will cause from related-party revenue that disappears at close, and the live options are Proceed, Reprice, Walk.

Decision

Carve-out separation lead in a PE platform evaluating a founder-led SaaS add-on must choose Proceed / Reprice / Walk / Hold using related-party revenue that disappears at close after a Phase II that found groundwater impact.

Hypotheses to test

• A Phase II that found groundwater impact is noise around an already-controlled Separation and Integration process in a PE platform evaluating a founder-led SaaS add-on, given related-party revenue that disappears at close.
• A Phase II that found groundwater impact is the event in related-party revenue that disappears at close that forces Proceed for carve-out separation lead under M&A Due Diligence.
• Related-party revenue that disappears at close shows a one-file miss after a Phase II that found groundwater impact, not a Separation and Integration program failure.
• Related-party revenue that disappears at close cannot decide earnout definitions will cause yet after a Phase II that found groundwater impact; hold is the only M&A Due Diligence close a PE platform evaluating a founder-led SaaS add-on can defend.

Analysis required

• Test whether a Phase II that found groundwater impact is a diligence gap, a price chip, or a walk-away.
• Separate a one-off add-back from a recurring earnings issue in related-party revenue that disappears at close.
• Map reps, earnout mechanics, and integration risk a PE platform evaluating a founder-led SaaS add-on would inherit.
• For this M&A Due Diligence Separation and Integration file, read related-party revenue that disappears at close against a Phase II that found groundwater impact and write the one fact that would move earnout definitions will cause for carve-out separation lead.

Recommendation

Choose Proceed / Reprice / Walk / Hold on this M&A Due Diligence / Separation and Integration packet (related-party revenue that disappears at close after a Phase II that found groundwater impact). The follow-on Separation and Integration action is what carve-out separation lead does next: implement the option, assign an owner, and log the missing fact.