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Exclusivity agreement template
At PaperRock Documents, we offer expertly designed exclusivity agreement templates created by top UK solicitors. Our templates are simple to use, easy to customise, and cost-effective.
On this page, you’ll find templates specifically for investment transactions. Scroll down to learn more and choose the one that’s right for you.
We also provide templates for other key scenarios:
- Sale of shares: Protect your negotiations during complex share sales.
- Business purchases: Safeguard both parties in major business deals.
With our templates, you can handle your legal needs confidently and focus on closing the deal.
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What is an Exclusivity Agreement?
An exclusivity agreement helps secure negotiations during business transactions. It sets a specific time, called the exclusivity period, during which a seller or company agrees not to discuss deals with other potential buyers or investors.
At PaperRock Documents, we provide two types of exclusivity templates for investment transactions:
- Comprehensive Agreement: a detailed document for complex deals.
- Short-Form Agreement: a concise, letter-style template for simpler transactions.
We also offer exclusivity agreement templates for share sales and business purchases.
Why use Exclusivity Agreements?
Exclusivity agreements are useful at the start of significant deals, such as:
- buying a company, business or commercial property
- investing in a business
These agreements give buyers and investors the confidence to conduct their due diligence checks and prepare the legal documents for the deal without interference from competing offers. They often go hand in hand with NDAs for the protection of written or oral confidential information.
The exclusivity obligations are framed as restrictions on the seller or company from negotiating or entering into a similar transaction with someone else for the specified exclusivity period. They are not usually framed as obligations to negotiate in good faith due to these types of commitments being potentially invalid or unenforceable under English law.
What is due diligence?
Due diligence is a detailed review of a company’s financial, legal, and operational records and history. It helps buyers and investors assess risks and opportunities before the parties agree to commit to a deal.
How long should the Exclusivity Period last?
The exclusivity period typically lasts 4 weeks to 3 months. Shorter periods, like 2 weeks, might apply when:
- the buyer is a preferred bidder following an auction sale process
- the company is in financial trouble and needs a quick sale
Longer periods are rare but may be necessary for more complex transactions.
What happens if an Exclusivity Agreement is broken?
If the seller or company breaches the agreement, the buyer or investor can claim damages under a legal claim for breach of contract to recover costs incurred during due diligence or contract preparation.
A well drafted exclusivity agreement will also include indemnity clauses. These require the seller or company to reimburse the buyer/investor for losses, costs and other liabilities, often up to a set limit.
