Can a buyer run the business however they want during an earn-out, or does the seller get a say?

Absent specific protections negotiated into the purchase agreement, a buyer who now legally owns the business generally has the right to run it as it sees fit after closing, since ownership and control passed to the buyer at that point regardless of any earn-out still outstanding. This creates an obvious tension: decisions that make good sense for the buyer's broader operations, such as cutting a product line, changing marketing spend, or integrating the target with other operations, could reduce the very metric the earn-out is measured against.

Because of this tension, sellers commonly negotiate operating covenants specifically for the earn-out period, requiring the buyer to run the target business consistent with past practice, maintain agreed levels of investment or staffing, avoid diverting customers or opportunities elsewhere, and use consistent accounting methods for calculating the metric. Without these kinds of covenants written into the agreement, a seller generally has limited ability to challenge ordinary business decisions the buyer makes during the earn-out, even if those decisions happen to lower the payout.