MPL General Counsel – It Ain’t Over ‘til It’s Over

The big day is coming.  You have crossed all the T’s and dotted all the I’s, or have you?  There are a few crucial, yet often ignored items that you and your M&A team should make sure is finalized prior to at closing.

1. Closing Process – How will closing be handled?  Will it be in person or virtual?  Who is holding any escrowed funds?  How will the money be transferred?
2. Settlement Statement/Flow of funds – Just like buying/selling a house, the same holds true for a business.  I highly recommend that you have a settlement statement prepared which details the sources and uses of funds.
3. Closing documents – Unless you are doing a “sign and close”, you should already have an executed purchase agreement.  In that purchase agreement, there are likely schedules which should be finalized and exhibits that need executed.  Examples of exhibits include a bill of sale, an assignment and assumption agreement, a seller creditor agreement, escrow agreement, and resolutions for the buyer and seller.
4. Financing Documents – If the deal is being financed, have you gathered everything required by the financial partner.  Has your team reviewed all the financing documents as well?
5. Miscellaneous – Closing checklists, employment agreements, leases, bulk sale notices and so on are also other items that should also be a part of the preparation for closing.
6. Closing Binder – Please make sure that you or someone on our team compiles a complete package (i.e., a closing binder) of everything that was reviewed during due diligence and executed for closing.  If something comes up post-closing, this “closing binder” will be the focal point of any disagreements.

As Yogie Berra said – “It ain’t over ‘til it’s over.”

Here are some other items of interest:

• Two informative updates sent by Sean O’Dowd from Silvercrest Asset Management Group
  • May 2022 Monthly Review from Rob Teeter
  • Time Matters & Market Declines

Helpful Resource Pages

• Knowledge Center (eisneramper.com)
• Trout CPA Blog | Tax & Business-Related Topics
• News & Analysis | Littler Mendelson P.C.
• Insights, Analysis & Perspectives for Your Business | RKL LLP (rklcpa.com)
• NFIB Research: Data and Trends Affecting Small Business Owners | NFIB
• The Tax Warrior Chronicles (taxwarriors.com)

Learn More About The Merge & Acquisition Process

• Time to Put The Pen to Paper