I'm a self-funded searcher currently looking at business that supplies equipment to warehouse and distribution centers and am considering an offer. I'm interested in hearing opinions on how much I should ask for as an earn out?

Asking Price - $3m ($2m for business and $1m for stock)

EBITDA - around $800k after adjustments

The business has been operating for over 20 years and the owners (2 guys in their early 70s) would like to retire. It was advertised for sale in 2015, 2016, and 2018 but the owners say they didn't receive any serious offers.

At this stage I haven't come across any major issues that would discourage me from making an offer. Sales can be a little lumpy due to the nature of the business, however it has remained profitable for 5+ years.

How much would be a reasonable amount to ask for as an earnout? 30%? 50%? I want my offer to be taken seriously but I can also see there is potential here for quite a generous earnout.