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Mergers and acquisitions often involve contingent payouts known as earn-outs. This means that the sellers of the target company may receive additional money if certain financial goals are met in the future. For example, the buyer may agree to pay $10 million upfront with an additional $500,000 if the target company hits a net income of at least $2 million in the next year. Earn-outs can lead to a higher total price than initially stated in the acquisition announcement.