M&A Due Diligence Checklist: A Guide for Business Sellers

Sellers who are diligence-ready before they go to market close transactions faster, with fewer surprises, and often at better prices. The reverse is equally true: sellers who enter a process with disorganized documentation lose leverage when buyers discover problems mid-stream and use them to renegotiate. For the buyer-side view of what buyers actually examine in M&A due diligence, see our companion overview.

This checklist covers the major categories of documents and information buyers typically request in a middle-market M&A transaction. Use it to identify gaps, resolve known issues, and build your virtual data room before your process begins — not after a buyer issues their first request list.

1. Corporate and Organizational Records

Certificate of incorporation or articles of organization, and all amendments
Current bylaws or operating agreement
Fully diluted capitalization table (including all options, warrants, and convertible instruments)
Board and member meeting minutes for the past three to five years
Stockholder or member resolutions authorizing prior significant transactions
Good standing certificates and registered agent information for all operating jurisdictions
Organizational chart showing all subsidiaries and their ownership structure

2. Financial Records

Audited or reviewed financial statements for the past three to five years
Current year-to-date interim financials (within 60 days)
Trailing 12-month revenue and EBITDA bridge with documented addback support
Accounts receivable and accounts payable aging schedules
Federal and state tax returns for the past three to five years
Capital expenditure history and near-term projections
All existing debt, credit facility, and financing agreements

3. Material Contracts

All customer contracts representing more than 5% of revenue
Supplier, vendor, and distributor agreements
Real property leases and subleases
Equipment leases and financing arrangements
License agreements (inbound and outbound)
Non-compete and non-solicitation agreements with third parties
Management agreements and consulting arrangements

For each contract, confirm: (a) whether it is fully executed and current; (b) whether it contains a change-of-control or assignment restriction; and (c) the expiration date. Change-of-control issues and assignment restrictions are among the most common transaction complications discovered during diligence. For LLCs, make sure the operating agreement’s transfer and consent provisions are also reviewed in this same pass.

4. Intellectual Property

Patents (issued and pending), trademarks, copyrights, and trade secret documentation
Domain names and social media accounts
IP assignment agreements from all founders, employees, and contractors who developed company IP
Inbound software licenses and open source usage documentation
Outbound technology licensing agreements

5. Employment and HR

Employee roster by department, location, and classification (full-time, part-time, contractor)
Employment agreements and offer letters for all key employees
Equity incentive plan documents, option agreements, and vesting schedules
Bonus, commission, and deferred compensation arrangements
Employee handbook and key HR policies
Benefits plan summaries (health, retirement, and other plans)
Any pending or threatened employment claims or agency complaints
Independent contractor agreements and classification documentation

6. Litigation and Regulatory

All pending and threatened claims, lawsuits, and arbitrations
Correspondence with any regulatory agency (including informal inquiries)
Industry-specific licenses and permits, with any restrictions or conditions noted
Environmental compliance records, if applicable
Data privacy and security compliance documentation

7. Insurance

Current insurance policies (general liability, D&O, E&O, cyber, property, workers’ compensation)
Claims history for the past three years

A Note on Timing

The time to assemble this documentation is not when a buyer issues a diligence request list. By then, the clock is running and gaps become negotiating leverage for the buyer. Sellers who maintain organized records and address known issues proactively are in a fundamentally stronger position when a deal process begins.

Working with experienced M&A counsel before going to market — not just after signing an LOI — is one of the most consequential decisions a seller can make. The legal costs of preparing properly are modest relative to the price adjustments, extended timelines, and eroded leverage that come from entering a process unprepared. For the full sequence of stages, see our guide to the sell-side M&A process, and for early-stage groundwork, our framework for preparing to sell your business.

➤ Contact Petersen | Landis to start your diligence preparation before going to market.