M&A Preparation Checklist

Overall Readiness
0%
Categories Complete
0/6
0 / 0 items
Red Flags Identified
0
Active issues requiring attention

Financial Readiness

0%
Independent auditor verified, GAAP compliant
All local, state, federal returns filed and paid
IRS clearance, no outstanding assessments
Document payment history and collection rates
Share certificates, cap table, option agreements
ASC 606 compliant, auditor verified

Legal Readiness

Current, signed, properly recorded
All customer, vendor, employment contracts reviewed
Patents, trademarks, copyrights, source code ownership
Legal opinions on all material claims
Industry-specific licenses, permits, certifications
Personal guarantees identified and release strategies

Operations Readiness

0%
All critical processes, workflows, decision trees
Dependency analysis, transition plans for critical roles
SLAs, termination clauses, change of control provisions
GDPR, CCPA, SOC 2, cybersecurity assessment
E&O, D&O, liability, key person, cybersecurity
Leases, equipment, locations, condition assessment

Team & Leadership Readiness

0%
Clear reporting lines, responsibilities documented
All key employees have signed agreements
Earnouts, stay bonuses, non-compete plans
All leadership team members verified
Salary, equity, benefits, succession planning
Meetings documented, governance in place

Customer Base Readiness

0%
Top 10 customers, revenue distribution, risk level
All terms current, change of control reviewed
3-year historical data, trends, forecasts
Recent surveys, feedback analysis, improvement plans
Revenue predictability assessment
CAC, LTV, payback period calculations

Technology Readiness

0%
Code quality, security assessment, architecture docs
Identified issues and remediation timeline
Cloud setup, capacity, cost structure documented
Third-party dependencies, SLAs, risk assessment
RTO/RPO defined, tested, documented
Key developer retention, code ownership clear

Document Tracker

Document Category Document Status Notes
Financial Audited Financial Statements (3 yrs) Missing
Financial Tax Returns & Compliance Records Missing
Legal Incorporation Documents & Bylaws Missing
Legal IP Assignment & Patent Documentation Missing
Operations SOPs & Process Documentation Missing
Operations Key Vendor & Supplier Contracts Missing
Team Org Chart & Employment Agreements Missing
Customer Top 20 Customer Contracts Missing
Technology Source Code & Architecture Documentation Missing

M&A Preparation Timeline (6-12 months)

Months 1-2
Phase 1: Discovery & Planning
  • Conduct internal readiness assessment
  • Form M&A preparation team
  • Create detailed timeline and budget
  • Begin document organization
Months 3-4
Phase 2: Due Diligence Preparation
  • Complete financial audits
  • Conduct IP audit and assignments
  • Compile customer contracts
  • Organize employment agreements
Months 5-6
Phase 3: Documentation & Cleanup
  • Complete SOP documentation
  • Resolve any legal issues
  • Address technical debt
  • Create data room index
Months 7-9
Phase 4: Final Review
  • Board approval and resolutions
  • Legal opinion letters
  • Final document package review
  • Engage advisors (investment banker, counsel)
Months 10-12
Phase 5: Market & Closing
  • Market to strategic/financial buyers
  • Respond to buyer questions
  • Negotiate terms and conditions
  • Closing preparation and execution

Red Flags & Issues

Priority Recommendations