- Articles of incorporation, bylaws, minutes, subscription agreements, shareholder agreements (and similar documents for an LLC and other formations).
- Copies of properly filed federal and state income tax, employment tax, state and local sales/use tax, property tax and other returns.
- If you do business in other countries, compliance with foreign tax requirements.
- Income statements, balance sheet (audited, if available), deferred revenue, working capital, bank account information, revenue recognition policies, accounting procedures, debt, loan information and balances.
- Bios, employment contracts, salaries, management incentive plans and stock options. (Be aware that background checks and Internet searches about executives may be conducted.)
- Have managers signed non-compete agreements?
- Computer systems and IT security;
- Business equipment and related outstanding loans;
- Maintenance of equipment, vehicles, facilities;
- Distribution systems;
- Strategic relationships, key vendors, suppliers;
- Contracts with vendors and independent contractors;
- Research and Development;
- Facilities, including parking; and
- Anticipated space needs in the future.
- Salaries, overtime, bonuses, profit sharing;
- How your business handles employee evaluations, discipline and terminations;
- Do any employees work remotely or from home?;
- Compliance with federal, state and local laws;
- Employee handbook; and
- Offer letters, contracts and non-compete agreements with employees.
- Retirement plans, including vesting and employer match programs; and
- Health insurance programs, including whether you have any former employees under COBRA.
- Licenses, permits, and required correspondence with government entities.
- Are you up to date on all public filings?
|Sales and Marketing
- Pricing of products and services;
- Per customer revenue;
- Customer retention statistics;
- Commission structure for sales people;
- Lead generation and tracking of leads in the pipeline; and
- Advertising/ marketing programs and attendance at trade shows.
|Products and Services
- Inventory (cost, value and average levels);
- Obsolete or slow moving items; and
- Pending products under development.
- Pending litigation, claims, major disputes;
- Ownership and protection of intellectual property; and
- Compliance with the Sarbanes-Oxley Act; the Patriot Act, Occupational Safety and Health Act; the Fair Labor Standards Act, the Consumer Product Safety Act and all other federal and state relevant laws.
- Leases, terms;
- Mortgages and equity in real property;
- Environmental concerns; and
- Tax liens and other liens against properties.
- Policies including business liability insurance, life, auto; product liability, directors and officers, casualty, Workers’ Compensation; and
- Accident/ injury reports.
- Have you had a professional valuation done?
- Does the value include intangibles such as goodwill?