Economic impact of documentation

In the execution of financial transactions companies almost exclusively focus on pricing while other important factors such as the “small print” in documenting the deal tends to be neglected. Such important points in documentation include: 

  • Cross default clauses
  • Financial covenants and early termination
  • Representations and warranties

There is a wide range of different wordings for such documentation clauses, from a commercial point of view more restrictive clauses can seriously affect the future financial flexibility of a borrower. Therefore the “small print” in documentation generally requires careful consideration.

Independent Capital analyses already existing or currently negotiated financial documents with a focus on their impact on the company’s strategic objectives as well as the overall fit with its business model.