TSA Negotiation Checklist

What to nail down before signing a Transition Service Agreement, so it doesn't quietly become the most expensive line in the deal.

Itemized service catalog — no bundled "IT services" line items without a breakdown
Explicit pricing model per service (cost-plus, fixed fee, market rate) and who bears cost overruns
Exit milestones and dates per service, not just an overall TSA end date
Service levels (SLAs) and remedies if the seller under-delivers during the transition
A named owner on both sides accountable for the exit plan, not just service delivery
Early-termination rights if the buyer stands up independent capability ahead of schedule

Watch out: A TSA with a single end date and no per-service exit milestones almost always runs long — the services that are hardest to exit (usually IT) get deprioritized until the deadline forces a scramble, extending stranded cost on both sides.

Transition Service Agreements (TSAs)

The bridge that lets a divested business keep operating on the seller's systems and staff after close — and the biggest source of both risk and hidden cost.

IT / Technology

Usually the largest and least certain stranded-cost category — ERP separation alone can swing a model by tens of millions.