11. Post acquisition for sellers

After the acquisition of your game is completed, there are several important steps and considerations to ensure a smooth transition and fulfillment of all agreed terms.

Here’s what happens post-acquisition:

Deliver on your promises post-acquisition

1. Transition services:
• You may need to provide transition services to the buyer as outlined in the Asset Purchase Agreement (APA). These services help the buyer integrate and manage the newly acquired game.

• Duration: Transition services can range from 30 days to one or two years, depending on the agreement.

• Types of Services: Common transition services include consultation, maintaining or updating code, participating in customer or employee meetings, and training the buyer's team.

     2. Earnouts and conditional payments:

• If you agreed to an earnout, you might continue to be involved in the business to help achieve specific performance goals.
• Examples: Meeting revenue or profit milestones can trigger additional payments.

Request post-closing payments

Acquisition deals vary, and you might have negotiated different payment structures:

• All-cash deal: Full payment received at closing.
• Conditional payments: Payments contingent on meeting certain conditions, such as resolving pending litigation or achieving earnout milestones.
• Seller financing: Periodic payments as agreed in the seller financing agreement.

Ensure to:

• Monitor and meet the conditions for post-closing payments.
• Request payments promptly when conditions are met, using your Gamehaap dashboard or contacting the buyer directly.

Prepare for the unexpected

During the sale, you made several representations and warranties about your game. While these are made in good faith, there can be unexpected issues post-closing:

• Representations and warranties: These are your statements of fact and promises about the game’s condition.
• Survival period: Typically lasts six months to a year, during which these representations and warranties remain in effect.
• Indemnification: If an issue arises that causes the buyer a loss, you may need to resolve the situation or indemnify the buyer, often up to the value of the purchase price.

Some agreements include seller holdbacks to ensure funds are available to cover any indemnification needs.