Law360, New York (February 01, 2012, 2:06 PM ET) -- As the regulatory and competitive risk profile of renewable energy/green-tech companies has increased, so too has the use of earnouts or other deferred compensation structures in merger and acquisition transactions in this space, particularly in smaller and middle-market transactions.

Buyers have become increasingly concerned with (i) the prospect of reduction or elimination of government subsidies, (ii) the potential reduction or elimination of consumer incentives that support product demand, e.g., tax rebates for solar panel installation, and (iii) price pressure resulting from increasing supply, particularly with respect...