Confirming the basics
The starting point is the company's existence and authority: its formation documents, its status with the state where it was organized, and whether the person signing has the power to bind it. Ownership is often less clear than it appears, so confirm who holds the equity and who ultimately controls the company, including through parent entities or nominees. Check the capitalization records for promised but undocumented interests, options, or convertible instruments. Board and shareholder approvals for past major actions should be in the records. Gaps in these basic items can make later agreements unenforceable or expose you to claims from people who believe they own part of the company.
Searches and screening
Public searches can reveal lawsuits, judgments, tax liens, and secured lending filings that encumber the company's assets. Screen the company, its owners, and key managers against sanctions lists maintained by the Treasury Department's Office of Foreign Assets Control and other relevant governments. Where the company deals with government officials or operates in higher-risk regions, look at anti-corruption risk, including how it uses intermediaries. Review licenses and permits needed for the business and confirm they are current. Corporate due diligence on foreign entities often requires local counsel and records that are harder to obtain.
Using what is found
Findings rarely mean the deal is off, but they often change its terms. A lien may need to be released at closing, an ownership gap may need to be fixed with new documents, or a sanctions concern may require ending discussions entirely. Unresolved issues can be addressed through representations, indemnities, holdbacks, or conditions in the agreement. We scope the review to the size and risk of the transaction, coordinate with financial and local advisors, and report findings in a form that decision-makers can act on. Keeping a record of the review also helps if the decision is questioned later.
