Exclusivity
A period during which the seller agrees not to negotiate with other potential buyers, giving the preferred bidder time to complete due diligence and finalise documentation.
Also known as: Exclusivity period, Lock-out period
One-line definition
Exclusivity gives the chosen buyer a clear runway to complete FDD and negotiate the SPA without competition.
Typical length
4–12 weeks depending on deal complexity. Extensions are common if FDD uncovers issues requiring resolution.
Seller risk
Granting exclusivity means losing competitive tension. Sellers only do it once they have a satisfactory bid — sometimes after two rounds of bidding.
Related terms
LOI (Letter of Intent)
A non-binding document outlining the key terms of a proposed transaction, submitted by a potential buyer before entering exclusivity.
NDA (Non-Disclosure Agreement)
A confidentiality agreement signed by potential buyers before receiving sensitive information about a target company in a sale process.
Financial Due Diligence (FDD)
An independent review of a target company's historical and projected financials, conducted for a buyer or lender before completing a transaction.