During our proposed earnout, the buyer wants us to integrate our accounting and sales systems with their legacy platforms, which will slow down our sales cycle. How do we write system-integration covenants into the purchase agreement to protect our team's operational velocity?

Question

Tyler Smith · Accepted Answer

Buyers often want to integrate your operations into their legacy systems immediately after closing, but this can cause operational chaos that destroys your chances of hitting your earnout targets. If their clunky accounting or sales systems slow down your sales cycle, your team will miss their numbers, and you will lose your payout. To prevent this, you must negotiate system-integration covenants in your purchase agreement. These covenants should state that your business unit will maintain operational autonomy and continue using its existing technology, sales pipelines, and delivery systems during the earnout period. Specify that any proposed system integration must be mutually agreed upon and cannot disrupt your daily operations or sales velocity. To back this up, include your EOS® Accountability Chart as an exhibit in the purchase agreement to define exactly who has the authority to make technology and operational decisions. By preserving your team's GWC™ and maintaining control over your automated workflows, you protect your operational velocity. This autonomy ensures your team can focus on their quarterly Rocks and execute the daily activities required to hit your earnout targets without interference from the buyer's IT department.