The buyer wants to exclude our top two clients entirely from our baseline enterprise value and only pay us for them through a contingent escrow release over twenty-four months. How do we structure our transition plan to protect this value without accepting a complete carve-out?

Question

Tyler Smith · Accepted Answer

Accepting a contingent escrow release for your top two clients is a massive risk because it places your payout at the mercy of how the buyer operates the business post-close. If they mismanage the accounts, you lose your equity. Instead of accepting a flat carve-out, you must institutionalize these accounts and prove their stability using your EOS Accountability Chart.

Show the buyer that these two clients are not bound to you personally, but are integrated into your company system. Identify the specific account managers who GWC (Get It, Want It, Capacity to Do It) these relationships. Show the buyer your structured communication rhythms, such as the quarterly client reviews that are tracked as Rocks on your V/TO.

To bridge the valuation gap without a full carve-out, propose a joint transition committee structured around your existing operating cadence. Create a specific, time-bound transition agreement where you commit to personally attending key client touchpoints for the first six months, but tie the release of the valuation to client retention, not arbitrary escrow conditions.

Additionally, structure a clawback provision rather than an escrow. This means you receive the full valuation at close, but if a top client leaves due to a pre-closing issue within a specified period, the buyer has recourse. This keeps the burden of proof on the buyer to show they did not drive the customer away through poor post-close execution.