All Plays

Signing and Closing

In this play, learn how to plan and prepare for a smooth divestiture signing and closing.

Play by:

About the play

A smooth signing and closing requires careful detail and preparation. The exercise must, therefore, be well organized so that last-minute issues do not hold up the process.

Typically the signing and closing process is the responsibility of the Legal function. They take on the responsibility for organizing the process, obtaining signatures, and drafting and negotiating all closing documents.

Preparation

The Legal Function typically compiles a deal completion checklist from the sharer & purchase agreement. This document summarizes all the activities that need to be completed before closing. The steps outlined here ate typical as part of the closing process.

People

Executive sponsor, separation manager and deal team

Difficulty

Medium

Materials

Meeting Agenda, Whiteboard, Strategy Documents

Time

Spend one day or more to prepare materials for a two hour play.

Running the Play:

01

Obtain Necessary Consents

All required regulatory approvals and third-party consents such as transfers of contracts that have a change of control provision and therefore require consents will need to have been secured. Typically, private transactions do not require regulatory approval.

02

Confirm Representations and Warranties

The other party’s representations and warranties will have been true when made and remain true at closing, and they will require that the other party will have complied with its pre-closing covenants.


03

Obtain Board and Shareholder Approvals

Board or shareholder approvals are required in most transactions to affect the transaction, in addition to any contractual or statutory requirements that may have to be met. If opinions of counsel are to be supplied by each party to the other party, the law firms supplying the opinions need to complete due diligence.

04

Obtain Certificates and Filings as Appropriate

Obtain certificates regarding the validity of the corporations entering into the agreements. Also, make filings with the applicable government and regulatory entities in the appropriate jurisdictions. This will satisfy any laws in those jurisdictions.

05

Ensure Transaction Documents are Executed

06

Confirm Payment Consideration is Available

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