A closing changes the legal reality immediately, but contracts do not all respond to that at the same speed. Some clauses activate the moment of signing. Others lie dormant until a counterparty invokes them. On Day 1, the question is not which contract is most significant in size, but which contract contains a trigger that is already going off.
This is the most direct reason why a contract deserves Day 1 attention. A change of control provision gives the counterparty the right to terminate an agreement, renegotiate it, or demand additional approval as soon as control over one of the parties changes. In a cross-border acquisition, this type of clause is often spread across multiple legal systems, with slightly different formulations of what "control" precisely means. Which contracts contain such a clause should already be mapped out before closing; on Day 1, the question is which of these have a notification period that is already running.
Contracts with exclusive purchase or supply obligations are sensitive because an acquisition sometimes results in the new owner having competing relationships. Whether this is a problem depends on the sector and on how strictly the exclusivity is formulated. This is one of the places where it holds that integrating is not self-evident: merging a supplier with an existing purchasing relationship can add value, but can also trigger a contract that is better left separate until the terms have been reviewed.
In an acquisition affecting two or more countries, different protection regimes apply to employees. In a number of European jurisdictions, employment terms automatically transfer in the event of a transfer of undertaking, with their own information and consultation obligations that must already have been completed before or around Day 1. In other jurisdictions, this works differently. Which contracts or collective labour agreements are relevant here, and which deadlines apply to them, differs per country and per type of acquisition; this cannot be summarised in a single rule.
Loan agreements often contain their own change of control or cross default provisions. An acquisition can trigger a clause that gives the bank the right to demand early repayment, or that activates a covenant requiring additional reporting. This is a contract category where the consequences of not acting on Day 1 are directly financial, in contrast to, for example, a commercial contract where the counterparty may only respond later.
Agreements with government bodies, or permits linked to a specific legal entity, require attention because they sometimes do not automatically transfer in the event of a change of ownership or legal form. Whether a transfer is necessary, and within what timeframe, depends on the country and the type of permit. This also touches on the question which legal-form steps are required on Day 1 in a cross-border acquisition, because a permit is sometimes attached to a legal entity that changes as a result of the deal itself.
Licence agreements for brands, software, or technology regularly contain provisions that restrict sublicensing or transfer. In a cross-border deal, this is extra sensitive because IP rights can be registered separately per jurisdiction, each with their own transfer requirements. A licence that has not been correctly transferred on Day 1 can cause a usage right to lapse without this being immediately visible.
These contracts require attention, but that does not mean they all need the same treatment. Some triggers require a notification, others a renegotiation, and others nothing at all because the clause is not invoked in practice. It is a mistake to treat this as a tick-box list without asking whether merging on this point adds value or only adds complexity. A contract with a counterparty that functions well on its own does not need to be pulled into the integration process; sometimes it is better to leave it separate until there is a concrete reason to change it.
This contract question is also not separate from the rest of Day 1. What needs to be correct in the systems to keep payments running is addressed in what happens to payments on Day 1 in a cross-border acquisition, and who is allowed to tick off which condition precedent is related to who decides what on Day 1 in a cross-border acquisition. Communication also plays a role: a contract party expecting a change of control notification is often the same party that should learn of it through the process described in what you communicate on Day 1 in a cross-border acquisition.
Some of the contract work does not belong on Day 1, but in the period afterwards, when it becomes clearer which contracts are strategic and which are operational. That consideration is described under the question which decisions belong in the first hundred days. On Day 1, the main concern is preventing unintended triggers; the question of what needs to structurally change afterwards comes later.
Going through contracts for triggers, deadlines, and jurisdictional differences is exactly the kind of work where manual searching costs time that is not available on Day 1. The werkscan (job scan) of FTE TO AI calculates per task which part of it can be taken over by AI, making clear where automation can speed up the contract work and where human judgement remains necessary.
Vraag maar wat er op Day 1 moet staan, of wat integreren juist kapotmaakt.
Answers come from this site’s knowledge base. Not tailored advice, and not a scan of your company.