M&A Due Diligence: Comprehensive Commercial Contract Review Checklist
Conducting due diligence on a target company's commercial contracts? Our essential checklist streamlines your review process for both customer and supplier agreements. Learn how to assess critical elements including pricing structures, service level agreements, intellectual property rights, and termination clauses. Uncover hidden risks and opportunities that impact deal valuation and post-acquisition integration. Ideal for M&A lawyers, corporate development teams, and business executives involved in tech, manufacturing, and service industry acquisitions. Optimize your contract analysis and make informed decisions with our expert-crafted review guide.
Overview and agreement details
Identify the parties involved (and their relationship, if any)
Specify the nature of the agreement (customer and/or supply contract)
Commercial details
Indicates whether there is a minimum contractual quantity the Customer agreed to purchase
Approximate annual contract value or pricing (revenue)
Clarifies whether the target Company is the exclusive supplier or not
Term and termination rights
Outlines the initial term of the contract
Identifies an option to extend the term for an additional term
Notes whether the Customer has the right to terminate the contract early
Transfer restrictions
Identify any transfer restrictions or assignment restrictions or restrictions on a change of control of the target company
Liability regime
Whether the target company indemnifies the other party and in what circumstances
Whether the target company’s liability is limited and if there are any exclusions from this limit (where the liability is unlimited)
Whether the target company is liable for consequential loss
Security
Whether the target company is required to provide security
Miscellaneous
Identify the governing law
Any other onerous or unusual provisions identified
