“Ninety-eight percent of the lawyers give them all a bad name,” says my accountant with a wide, self-satisfied grin. While everyone, including attorneys, enjoys lawyer jokes, competent legal counsel is an essential ingredient in every well-crafted transaction.
Our company is often asked to pull from our files Purchase and Sale Agreements and any associated documents representing similar transactions in order to reduce or even eliminate legal bills. In truth no two newspapers, and no two newspaper transactions, are identical. The lawyer’s role is to spot problems and identify risks so they can be safely managed. And when risks cannot be entirely eliminated legal counsel identifies ways for appropriately sharing the risks between buyer and seller. Shortcuts often can be dangerous. Good legal counsel is not a luxury. It’s a necessity!
Like most other things in our society, the legal arena has become more and more specialized. It’s this specialization that makes selection of an attorney all-important. Trial lawyers, no matter how effective in court, generally are not the best at crafting Purchase and Sale Agreements.
Our firm once represented a selling publisher intent on hiring a local attorney with many notches on his gun earned during feisty courtroom shootouts. You could almost hear him growl as he sat across the table from the buyer’s attorney. There were several issues in the documentation that I wanted more definitively crafted in order to reduce the potential for misunderstandings. The attorney’s response was to leave his original draft alone. He then added, “If there’s a dispute we’ll beat ‘em in court!” A short-sighted and ultimately a dangerous approach. With a balanced, properly structured transaction and skillfully crafted documents, the odds of later disputes and expensive litigation are substantially reduced.
Our seller publishers are best served when represented by attorneys specializing in corporate contract law who are expert at crafting balanced purchase and sale agreements, restrictive covenants, promissory notes and security agreements. There simply is no substitute for quality legal counsel. It’s a necessity!
An important word of caution: experience has proven that a sure road to disaster is for the publisher to surrender control of the transaction to an attorney, or for that matter a broker. While listening to advice, the publisher must “control” his advisers. And quality legal counsel understands her role — to further the client’s goal of a well-structured, profitable and safe transaction with a happy ending.
By the way, an attorney friend delights in telling the story about two accountants walking together. They both spot a penny on the sidewalk. Being ever frugal bean counters, they simultaneously grab the penny. The attorney explained, “That’s how copper wire was invented.” Touché!