In El Makdessi v Cavendish Square Holdings BV and another [2013] EWCA Civ 1539, the Court of Appeal held that clauses in a share purchase agreement providing that, in the event of a breach of the seller's restrictive covenants, the buyer's obligation to pay deferred consideration would cease and the buyer would be entitled to acquire the remainder of the seller's shares at price based on net asset value (and excluding goodwill), were unenforceable penalties.