It is the night before closing and Murphy’s law strikes – a minor change to the transaction results in consequential changes to hundreds of documents. Hours of work sit between you and the finalization of the transaction. Is there anything that can make the process smoother and simpler?
While last minute changes are a reality of the practice of law, a few best practices – technological and otherwise – can make handling them a little less painful.
1. Use shortcuts in your drafting.
The key to efficient changes begins right at the outset. Lawyers with a clear idea of terms, parties and numbers in mind are often tempted to reiterate those particulars throughout a given agreement. The unfortunate consequence is that minor detail changes result in a re-read of every single page. Tips you might want to consider include:
- Making ample use of definitions. Your definition section should set out crucial details that may vary such as effective dates, working capital targets and the purchase price. Consequential adjustments will be a breeze if you only have to modify one section.
- Using standard form agreements and placing all particulars in a schedule, with the body of the document referencing the schedule. You will know exactly where to go to flow through new details.
- Using shortcuts between documents. In an ancillary document, such as a directors’ resolution approving an agreement, refer precisely to the agreement being approved – but there is no need to refer to particulars of the agreement itself. Those are enforceable by virtue of the resolution, and the more unnecessary detail you insert, the more changes you may subsequently have to make.
2. Use an effective document management system.
A document management system – or DMS – is a central, cloud-based repository for documents in your firm. Features and benefits include version control, access for everyone in your firm to all relevant documents and ease of finding documents (often through a standard form “document number” that appears on the bottom of a given page). A DMS places in your hands powerful search features that enable you to find and edit documents and precedents using a wide variety of criteria.
The acquisition of that fancy DMS also means using it effectively. Documents get lost all the time on the desktops or hard drives of lawyers who plan to upload a document and never get around to it. Take the time to master your firm’s DMS and use it consistently. That small investment of time will save you numerous hours if something is misplaced.
3. Make your Closing Agenda a master guide.
The easiest deals to manage are those where the design of the Closing Agenda receives as much attention as the drafting of any document. Have multiple parties? Make sure that you have a column relating to who is preparing the document, so that you know who is accountable later on. Is the order of steps important? Craft a logical alphanumeric manner of structuring your deal, and apply it consistently as documents are added. Consider inserting document numbers right into your Closing Agenda as documents are drafted so you can retrieve documents from your DMS without the extra step of finding the document and locating the document number.
dealcloser’s versatile platform was modeled after the notion that the Closing Agenda is at the heart of your deal – and our company is passionate about helping you be more efficient and get more transactions done.