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IPO and Direct Listing Planning ChecklistMarch 2022

IPO and Direct Listing Planning Checklist Responsible PartiesTaskTimeline (from 18 months prior to IPO/direct listing organizational meeting)1Corporate GovernanceBoard and Committee MattersOngoing Directors and officers (D&O)questionnaires CC Company LegalPrepare and distribute questionnaires to existing and new directorsand officers. D&O background checks Company LegalObtain background checks on new directors and officers. Board composition CC Company LegalPrepare Board composition matrix, including desired functional areasand analysis of public-company independence and compositionrequirements. Board committees CompanyDiscuss with investor directors plans with respect to service on Boardor its committees following offering. CompanyConsider hiring a Board recruitment firm to assist with sourcingdirector candidates. CC Company LegalDiscuss formation of Board committees in advance of public listing.Ongoing18 monthsT18 monthsT18 monthsTConsider committee composition with respect to current Boardmembers and review of new director candidates.Prepare draft Board committee charters. Director orientation Company LegalT12 monthsOngoingDevelop onboarding policies and procedures for new directors,including background checks.Responsible Parties1T – IPO/direct listing organizational meetingCCCompany CounselCompany FinanceCompanyIssuer entityCompany HRCompany LegalLegal department of Auditorsissuer entityFinance department of issuerentityHuman Resourcesdepartment of issuer entityAudit firm

Responsible PartiesTaskTimeline (from 18 months prior to IPO/direct listing organizational meeting)1Corporate GovernanceCompany Policies Draft and adopt corporatepoliciesT18-12 months CC Company Legal CompanyReview existing and/or draft corporate policies. Implement and trainon corporate policies. Focus primarily on policies that have currentapplication/value as it relates to the current operations of thecompany. Anti-money-laundering policy (recommended for companies thathave payment processing or fintech functions). Code of business conduct and ethics. Corporate communications policy. Corporate governance guidelines (only need this post-offering). Employee handbook. Equity grant guidelines (only need this post-offering). Export controls policy (recommended for companies that selloutside of the United States). FCPA/anti-bribery policy (recommended for companies with foreignoperations). Indemnification agreement. Insider trading policy (recommend adopting pre-offering forcompanies with active secondary markets). Investment policy. Related-party transaction policy. Signature authority policy/matrix. Social media policy. Whistleblower policy.Responsible PartiesCCCompany CounselCompany FinanceCompanyIssuer entityCompany HRCompany LegalLegal department of Auditorsissuer entityFinance department of issuerentityHuman Resourcesdepartment of issuer entityAudit firm

Responsible PartiesTaskTimeline (from 18 months prior to IPO/direct listing organizational meeting)1Corporate GovernanceOther Governance Environmental, social andgovernance (ESG)6 months CC Company Company LegalTDiscuss current ESG landscape and best practices, including principlesand goals and how those will play into transition into being a publiccompany.Consider hiring internal ESG function.Engage ESG consultant to assist in developing an ESG framework.Pre-Offering Stock/Control Issues Review existing venturefinancing documents CC Company Company Legal Founder control mechanisms CC Company Company LegalConfirm applicability of qualified IPO definition (including with respectto a direct listing) and auto termination provision of existing venturefinancing documents.Evaluate anti-dilution provisions (if applicable).Review and prepare presentation on founder control mechanisms.Timing of implementation to be determined but can occur up until thetime of the public listing.12 monthsT12 monthsTResponsible PartiesCCCompany CounselCompany FinanceCompanyIssuer entityCompany HRCompany LegalLegal department of Auditorsissuer entityFinance department of issuerentityHuman Resourcesdepartment of issuer entityAudit firm

Responsible PartiesTaskTimeline (from 18 months prior to IPO/direct listing organizational meeting)1Compensation/HR Compensation strategy3 months T CC Company HR Company Legal Management and personnelreview Company Rule 701 disclosure packet, ifapplicable Review employmentarrangements/offer letters Engage compensation consultant to assist in benchmarking and settingcompensation strategy, including non-employee directorcompensation.Discuss potential modifications to compensation practices, includingequity compensation (i.e., change from options to RSUs, RSU vesting,etc.).Review current management team and legal, finance, FP&A andaccounting personnel to determine whether additional staff isnecessary to support being publicly listed.T18 monthsOngoingCCPrepare or review and revise current Rule 701 disclosure packet.Company FinanceCompany LegalCCReview current employment agreements and offer letters and currentchange in control terms for executives and directors and determineCompany Legalwhether agreements will need to be amended prior to offering.3 months TResponsible PartiesCCCompany CounselCompany FinanceCompanyIssuer entityCompany HRCompany LegalLegal department of Auditorsissuer entityFinance department of issuerentityHuman Resourcesdepartment of issuer entityAudit firm

Responsible PartiesTaskTimeline (from 18 months prior to IPO/direct listing organizational meeting)1Accounting/Finance Audit firm AuditorsEnsure audit firm and team is suitable for public company reporting. Company Finance Consider implications for required audit partner rotation. PCAOB standards Key metrics Financial statements2 AuditorsEnsure the Company is able to meet the more rigorous requirements Company Finance of an audit performed under PCAOB standards that will be required inconnection with the listing. Company Finance Determine key metrics to be disclosed to investors. Evaluate existingkey metrics that are presented to the Board and/or made availablebroadly within the company. Establish tracking and controlmechanisms that can accurately validate these key metrics – e.g., getthem off spreadsheets, minimize human involvement. AuditorsPrepare annual and quarterly financial statements. Company Finance Audit and review of annual and quarterly historical financialstatements. Company Finance Create multi-year financial model and track performance againstmodel. Company Finance Update accounting systems (e.g., ERP), as necessary. AuditorsDetermine adequacy of, and necessary improvements to, Company’s Company Finance internal controls and begin planning for SOX compliance. AuditorsIdentify material acquisitions that require disclosure of acquiredcompany’s financial statements pursuant to Rule 3-05 of Regulation CCS-X. Company FinanceFor more information, see our article. Company Legal AuditorsEvaluate proper accounting treatment for outstanding preferred stock, Company Finance notes and warrants, if any. Financial models Accounting system updatesReview internal controls3 Acquired company financialstatements Outstanding preferred stock,notes and warrants, if any12 monthsT12 monthsT6 monthsT3 months T12 monthsT12 monthsT12 monthsT12 monthsT3 months TResponsible Parties23In S-1 registration statement, there will be at least two years (three years if not an emerging growth company (EGC)) of audited financial statements and typically atleast four to eight quarters of SAS 100 reviewed quarterly information.Company will be required to have its internal controls audited after it ceases to qualify as an EGC and qualifies as a “large accelerated filer” or “accelerated filer”(including if it ceases to be an EGC because it qualifies as a large accelerated filer due to having a public float in excess of 700 million).CCCompany CounselCompany FinanceCompanyIssuer entityCompany HRCompany LegalLegal department of Auditorsissuer entityFinance department of issuerentityHuman Resourcesdepartment of issuer entityAudit firm

TaskResponsible PartiesTimeline (from 18 months prior to IPO/direct listing organizational meeting)1Accounting/Finance Evaluate cheap stock issuesSEC preclearance ofaccounting matters12 months AuditorsCCCompany FinanceCompany Legal AuditorsCCPrepare SEC preclearance letter.Company FinanceCompany LegalTDiscuss best practices for 409A valuations. Evaluate existing 409Avaluations.Determine the potential for any cheap stock issues and discuss bestpractices for financial reporting of stock-based compensation expense.Consider need for preemptive retrospective compensation charges.Identify any accounting issues requiring SEC preclearance.6 monthsResponsible PartiesCCCompany CounselCompany FinanceCompanyIssuer entityCompany HRCompany LegalLegal department of Auditorsissuer entityFinance department of issuerentityHuman Resourcesdepartment of issuer entityAudit firmT

Responsible PartiesTaskTimeline (from 18 months prior to IPO/direct listing organizational meeting)1Communications and Marketing Investor education6 monthsT Company Finance Design and implement a marketing plan and investor education Investor Relations programs.Consider engaging in non-deal roadshow that can be done preorganizational meeting; gather investor feedback to refine story.Consider hiring external investor relations consultant. Mock earnings calls Offering communicationsprocesses Develop relationships with investment banks and sell-side analysts.Company Finance Hold mock earnings calls and prepare mock earnings releases.Company LegalCCEstablish processes with internal and external legal andcommunication groups for preparation and dissemination of pressCompanyreleases and other communications in light of gun-jumping restrictionsand Regulation FD compliance.3 months T3 months TPresent to management team and Board on Regulation FD and gunjumping. Website review CC Company Legal Customer case studies Company Industry data CC Company Company Legal1 monthReview of Company website for mentions of, amongst other things,potential offering, forward-looking statements and projections, andother problematic statements.Discuss removal of items as necessary.Prepare customer case studies for S-1 registration statement and otheroffering materials.Begin compiling third-party statistical data for industry size for S-1registration statement and other offering materials.T3 months T3 months TResponsible PartiesCCCompany CounselCompany FinanceCompanyIssuer entityCompany HRCompany LegalLegal department of Auditorsissuer entityFinance department of issuerentityHuman Resourcesdepartment of issuer entityAudit firm