On most transactions, the parties have checklists of tasks that must be completed prior to closing, and some have checklists of deal terms they look to ensure are included. In our view, the list of what should be done prior to closing to minimize the risk of post-closing challenges is often overlooked. Based on experience managing post-closing issues on over 500 deals, we have compiled a checklist that can help avoid certain post-closing issues, potentially increase yield on consideration set aside in escrow and improve the ease of post-closing communications and payouts.

Highlights include:

  • Collect personal email addresses for all stock and option holders. The shareholder representative and escrow bank must be able to communicate effectively with the stakeholders for several years post-closing in order to make payments, and the pre-closing email addresses may no longer work.
  • Collect the cost basis and acquisition date for all share issuances.
  • Determine who will be able to engage in post-closing communications and ensure that such communications will not violate any existing contractual obligations.
  • Consider what materials will be made available to the shareholder representative at the time of closing or at the time a claim arises.

The full checklist is available here.

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