How to prepare a contract diligence findings report for Reseller Agreements

Prepare a reseller-side contract diligence findings report by establishing the controlling documents, testing channel economics, and comparing supplier commitments with the reseller’s customer obligations. For each material issue, record source evidence, business consequence, uncertainty, recommended action, and decision owner. Deliver a concise executive summary supported by a traceable findings register and calculations. The report should distinguish confirmed exposure from missing evidence and identify what must be resolved, mitigated, or expressly accepted before the relevant business decision.

When to use this workflow

Use this workflow for an acquisition involving a reseller portfolio, supplier onboarding, renewal, or investigation of a material channel-program change. It is designed for commercial counsel, transaction teams, and in-house lawyers reviewing from the reseller’s perspective.

Keep the review focused on diligence findings rather than a complete renegotiation. Examine authorization, economics, supply, licensing, warranties, support, restrictions, termination, and transition insofar as they affect the decision.

This is a general US transactional workflow. Conclusions depend on the actual language, governing law, facts, and deal context. Refer implicated state franchise/dealer, restrictive-covenant, and choice-of-law questions for transaction-specific analysis; the federal guidance below does not resolve them.

What you need

Collect materials connecting supplier rights with downstream promises:

• Executed masters, amendments, product appendices, territory schedules, authorization letters, and signature pages.
• Discount tables, rebate programs, deal-registration rules, renewal terms, and incorporated policies, including applicable versions.
• Customer contracts, end-user license terms, warranties, service commitments, and support escalation arrangements.
• Purchase orders, invoices, credits, rebate submissions, and records distinguishing reseller purchases from direct supplier sales.
• Price-change, default, termination, audit, or channel-status notices and response evidence.
• The reseller’s dated internal checklist or standard form, approval thresholds, and product, territory, and channel information.

Ask finance and sales for revenue concentration, pipeline, inventory, and outstanding customer commitments. Record who supplied each dataset, its coverage period, and completeness limitations. Business records support exposure estimates; do not treat them as substitutes for contractual entitlement.

Use the template

Use the Reseller Agreements — Contract diligence findings report as a working register. Copy this table into your working document or spreadsheet. Add a short executive summary stating scope, materials reviewed, material findings, and decisions required.

Assign stable finding IDs. Source / version should identify the document, execution or version date, and clause/page; cite supporting workpaper cells where calculations matter. Clause evidence should capture a precise paraphrase or short operative extract, with relevant definitions and cross-references.

Separate priority from confidence. A missing support appendix may create a high-priority uncertainty without proving inadequate protection. Distinguish confirmed wording, ambiguous wording, redaction, and language not located in the reviewed materials. Status / basis should identify the decision, approver, rationale, and conditions—not merely “closed.”

Step by step

1. Define the decision and review boundary

Identify whether the report supports acquisition approval, supplier onboarding, renewal, or remediation. Specify contracts, products, territories, review cutoff, and exclusions. Hardware inventory, software licenses, subscriptions, and services require different economic and continuity tests.

Agree on priority criteria: exposure, likelihood, operational burden, and available mitigation. Identify the dated internal standard used for comparison. If none exists, state the business requirements being tested rather than implying a market benchmark. The reseller’s negotiation checklist is an internal input, not evidence of customary terms.

Record: scope and review basis above the table; give material scope limitations their own finding rows.

2. Establish the controlling document set

Assign document IDs and compare executed copies with relevant drafts. Check signatures, amendments, incorporated policies, and schedule references. Read precedence provisions before deciding which economics or support terms control.

For example, section 20.4 of the SEC-filed Avaya Reseller Agreement generally prioritizes Product Appendices over Product Group Attachments and those attachments over the agreement, subject to express overrides. Section 20.5 requires signed written amendments. This is example-specific wording, not a hierarchy to import into another contract. (sec.gov)

Request missing incorporated materials and identify the conclusions they affect. Do not silently substitute current online policies for the applicable version.

Record: controlling sources, conflicts, missing versions, affected findings, and document-request owners.

3. Reconstruct the reseller’s economic entitlement

Separate purchase discounts, commissions, rebates, promotional allowances, and renewal compensation. Extract eligible transactions, calculation bases, payment triggers, exclusions, adjustments, and termination treatment. Check marginal versus retroactive tiers, refunds, direct sales, currency, and taxes where relevant.

Sections 3(c)–(d) of the SEC-filed Agilent–O.I. agreement illustrate transaction-specific distinctions: direct end-user purchases receive no reseller compensation, and certain add-on discounts depend on the original sale and continuing support. These provisions do not establish customary entitlement. (sec.gov)

Model representative transactions using labeled finance assumptions. Reconcile invoices and credits, but investigate whether historical treatment differs from the written formula.

Record: entitlement, calculation reference, disputed inputs, estimated exposure, and finance owner.

4. Compare supplier protection with customer exposure

Compare actual customer delivery, licensing, warranty, support, security, and remedy commitments with supplier obligations. Identify what the reseller performs itself and what depends on supplier cooperation. Check supply discontinuation, unilateral policy changes, and audit duties where they threaten performance or margin.

Read indemnities and liability provisions together: covered claims, exclusions, defense control, caps, and carve-outs. Test whether the supplier’s promised remedies address identified customer exposure rather than assuming equivalent protection.

Extract material reporting, training, audit, and license flow-down duties into supporting actor–action–trigger–deadline records. Keep payment and reporting obligations separate. Obtain completion evidence from operations before reporting compliance.

Record: each material mismatch, linked customer source, potential consequence, mitigation, and accountable owner.

5. Isolate restrictions requiring legal assessment

Map territory, customer, marketplace, competitive-product, and pricing restrictions. Distinguish suggested prices, advertising conditions, and binding resale-price requirements. FTC manufacturer-imposed requirements guidance explains federal rule-of-reason treatment for vertical minimum-price arrangements and notes that some state and international regimes differ. It does not approve the reviewed clause. (ftc.gov)

For exclusivity, identify scope, duration, alternatives, and missing market facts. The FTC’s exclusive dealing guidance describes these arrangements as generally lawful under rule-of-reason analysis while identifying foreclosure concerns involving market power. Breadth alone does not determine legality. (ftc.gov)

Map customer nonsolicitation separately: protected accounts, prospects, affiliates, prohibited conduct, duration, and carve-outs. Refer enforceability to appropriate counsel rather than resolving it through federal vertical-restraint guidance.

Record: restriction, commercial effect, factual gaps, legal question, and assessment owner.

6. Test termination and continuity scenarios

Read renewal, nonrenewal, default, cure, suspension, and termination provisions against open orders and customer commitments. Test accelerated invoices, inventory, registered opportunities, prepaid subscriptions, renewal income, and ongoing support.

Do not equate license survival with business continuity. In the Avaya example, section 7.7 preserves properly granted existing end-user licenses, while section 17.4 accelerates invoices at termination. Neither establishes continuing support or renewal compensation. Redacted periods in sections 17.1–17.3 cannot support deadline calculations. (sec.gov)

For the reviewed contract, verify triggers, notice recipients, delivery methods, receipt rules, and defined time periods before assigning dates.

Record: continuity exposure, verified triggers, unknown periods, and proposed transition protection.

7. Convert findings into decisions

Write material findings as evidence, consequence, uncertainty, and action. Separate document requests, amendments, operational fixes, and specialist research. Explain how each response addresses the reseller’s exposure.

Summarize confirmed material deviations, unresolved high-impact questions, and accepted residual risks. Normalize portfolio comparisons by product, territory, channel, and document hierarchy. Report observed wording without calling it market practice.

Have a second reviewer trace material findings to sources and check recommendations against dependent provisions. Return disputed assumptions to business owners. Distinguish report completion from transaction approval: a complete report can recommend withholding approval.

Record: final priority, required decision, authorized approver, rationale, and acceptance conditions.

Worked example

Fictional scenario. Alder Quay Distribution LLC is considering renewal with Cobalt Lantern Systems Inc. All parties, documents, amounts, and provisions below are fictional.

Executed master AQ-01 incorporates rebate schedule AQ-02 and missing support appendix AQ-03. Finance forecasts $48,000 using an 8% rate against a $600,000 channel-sales extract, but $150,000 represents direct supplier sales. Customer agreement AQ-C07 promises twelve months of help-desk coverage after activation. Separate opportunity-registration terms have not been supplied.

If the remaining $450,000 represents eligible reseller purchases, the modeled rebate is $36,000. The $12,000 difference is a conditional exposure estimate—not a confirmed accounting adjustment. Finance must verify transaction classification before using it.

The report therefore conditions renewal approval on resolving support coverage and validating economics. It assigns opportunity protection for further investigation rather than inventing a tail or asserting that missing terms contain none.

Common mistakes

• Reviewing only the master. Establish document completeness and precedence before finalizing economics or support findings.
• Calling all channel income commission. Separate discounts, rebates, and direct-sale compensation by their actual triggers.
• Treating missing evidence as adverse wording. Identify the search scope and affected conclusion; request the source.
• Ignoring downstream commitments. Compare customer promises with both supplier protection and reseller capacity.
• Closing issues on informal assurances. Identify whether the response supplies evidence, changes operations, or requires contractual documentation; record authorized acceptance.

Final quality check

• Material findings trace to verified document IDs, versions, and clause/page citations.
• Precedence, amendments, and incorporated materials are checked or explicitly unresolved.
• Calculations distinguish contractual inputs from business assumptions.
• Customer commitments are tested against supplier backing and operational capacity.
• Commercial deviations, evidence gaps, and legal questions remain distinct.
• Notice calculations use verified contractual triggers and available periods.
• Open issues have owners; accepted risks have authorized rationale and conditions.
• The executive summary matches the register and states any approval-blocking uncertainty.

Complete the workflow with DecoverAI

DecoverAI is the Legal Intelligence Platform for litigation and transactions. Use due diligence classification to organize reseller documents and prioritize human review, with tabular review supporting cross-document analysis. In Word, contract review supports represented-party selection and deal-specific instructions; findings quote clauses, locate text, rank severity, and identify missing language as not present. Lawyers verify sources and approve conclusions. Book a demo to discuss this findings-report workflow. (decover.ai)

Frequently asked questions

Should the report include every reseller obligation?

Keep the register decision-focused. Maintain routine obligations in supporting workpapers; elevate material exposure, uncertain performance, or significant dependencies. Identify excluded topics in the scope.

How should we report a missing discount schedule?

Identify affected products, assumptions, and conclusions. Request the applicable version and label economics provisional. An invoice discount alone does not establish the full contractual formula.

Can repeated portfolio terms establish a market standard?

Describe them as observed portfolio wording, not proof of market practice. Compare against a dated internal standard and explain differences in products, territories, channels, and controlling documents.

When is the report ready despite open issues?

When supported conclusions are traceable and unresolved issues have explicit consequences, owners, and decision conditions. State whether each material open issue prevents approval or can be accepted by the authorized decision-maker.

Sources

• FTC — Manufacturer-imposed Requirements
• FTC — Exclusive Dealing or Requirements Contracts
• SEC — LSCA Value Added Reseller Program Agreement
• SEC — Avaya Reseller Agreement

Scope: October 13, 2026 is the requested review cutoff. Live guidance does not independently establish its exact historical text on that date; filed agreements illustrate wording, not market standards.

This guide is general information about legal workflows, not legal advice for any matter. It was drafted and reviewed with AI assistance. The worked example is fictional. Contract rights and procedure depend on the governing law, the actual wording, and the facts, so check the cited sources and the rules that apply in your jurisdiction before relying on it.