Once all the negotiations, the due diligence, the buy/sell agreement and additional documents are finalized, we must ensure the transaction completes on schedule. In the days leading up to the closing date, documents are finalized and circulated for signatures; financing arrangements are confirmed and funds delivered from the lender; ensuring closing conditions are met by both parties; and collecting and transferring the purchase proceeds.
We normally exchange signed documents with the lawyer for the other party pursuant to promises between lawyers called “undertakings” which bind both parties to keep such promises. Undertakings allow the parties to avoid having to meet at the same location to conduct an official closing of the transaction on the closing day at the closing time.
Clients are normally very busy setting up the business for the takeover. Bank accounts must be opened, credit card/debit card payments set to the new account, licenses registered in the new owner’s name, employee meetings scheduled, client notifications sent out, suppliers notified of the change, promotions and marketing announcements set to launch and then all the little things that take time to sort out such as having the alarm codes and locks changed or arranging for a float for the cash registers. We take care of the balance of the legal requirements so that clients can focus on starting to run their business.
If you have questions about ‘Closing the Deal’ contact Montgomery Miles & Stone in Kelowna, BC to set up an appointment.