The Buyer Wants 90 Days of Exclusivity Before a Deal Is Final. Should You Say Yes?

A buyer just sent you a letter of intent.

The purchase price looks attractive. The terms seem promising. You are excited to finally have a serious buyer at the table.

Then you reach the exclusivity clause.

The buyer wants 60 or 90 days during which you cannot negotiate with anyone else. The deal itself is not guaranteed. Due diligence has not finished. The definitive purchase agreement has not been signed.

Many founders treat that clause as standard LOI language. That is a mistake.

Exclusivity is not just administrative language. It changes your negotiating position. Once you agree to it, you may have to stop talking to other buyers while the current buyer investigates your company and decides whether to proceed.

That trade can make sense in the right deal. But you should understand exactly what you are giving up before you agree.

What Does an Exclusivity Period Actually Lock Up?

An exclusivity clause, also called a “no shop” provision, restricts your ability to deal with other potential buyers for a defined period.

Depending on the language, you may agree not to:

• Negotiate with another buyer.
• Share information with another potential buyer.
• Solicit or accept another acquisition offer.
• Continue discussions with a competing bidder.

In practical terms, you are giving one buyer a protected period to conduct diligence without worrying that another buyer will step in.

That protection has value to the buyer.

It also has a cost for you.

What You Give Up When You Sign

The biggest loss is negotiating leverage.

Before exclusivity, you can compare offers. If another buyer is willing to pay more or accept better terms, that alternative can influence your current negotiation.

Once competing buyers are removed from the process, that pressure disappears.

Your team also has to dedicate time to one buyer’s diligence process. Requests can continue for weeks, covering financial records, contracts, employees, intellectual property, customers, litigation, and corporate documents.

The timing matters even more if the buyer later walks away.

If a 90 day exclusivity period ends on day 75 because the deal collapses, you have spent roughly a quarter of a year tied to that buyer. You may also have lost the opportunity to pursue another offer during that period.

M&A timelines are already getting longer. A Goodwin analysis from October 2025 found that sign to close time increased 64% from 2023 to 2024, with transactions routinely taking three to six months. A long exclusivity period can therefore consume a meaningful part of your exit timeline.

Why Buyers Want Long Exclusivity

From the buyer’s perspective, exclusivity creates certainty.

The buyer wants time to conduct diligence without another bidder competing for the company. A competing offer could force the buyer to move faster or increase its price.

Harvard Law School’s Program on Negotiation notes that exclusivity can be costly for a seller with several available options because it weakens the seller’s fallback position once exclusivity begins.

That is why the buyer’s preferred period may not be the right period for you.

A buyer asking for 90 days is not necessarily acting unfairly. It may genuinely need time for diligence and internal approvals.

Your job is to make sure the protection you give the buyer is matched by meaningful progress toward closing.

The Windsurf Example Shows Why Timing Matters

The importance of timing became clear in 2025 when OpenAI’s planned $3 billion acquisition of coding startup Windsurf collapsed over intellectual property disputes with Microsoft.

Once the exclusivity period expired, Google moved within days and paid $2.4 billion to hire Windsurf’s CEO and top engineers instead, according to Computerworld.

The lesson is not that every failed acquisition will produce a second buyer.

The lesson is that market options can disappear while you are tied to one transaction. If exclusivity ends after weeks or months of delay, another buyer may have moved on, changed its strategy, or made a different investment.

What Should Protect You in the LOI?

If you grant exclusivity, the clause should have clear boundaries.

A reasonable structure can contain:

A defined outside date

The clause should state exactly when exclusivity ends. Avoid vague language that leaves the period open.

Diligence milestones

The buyer should have to meet specific milestones to keep exclusivity active. This can tie extensions to actual progress rather than simply giving the buyer more time.

A breakup fee or expense reimbursement

If the buyer walks away without cause, you may negotiate compensation for the time and opportunity cost associated with the exclusive process.

These protections do not appear automatically. You need to ask for them during LOI negotiations.

How to Negotiate a Shorter Exclusivity Window

If the buyer asks for 90 days, consider responding with 30 to 45 days.

That gives the buyer a defined period while reducing the time you are locked out of other opportunities.

If the buyer needs more time, tie any extension to specific diligence milestones. For example, an extension could depend on completion of agreed financial, legal, or operational diligence by certain dates.

You can also ask for a good faith negotiation provision.

This requires the buyer to keep actively pursuing the transaction instead of allowing the exclusivity period to run while making little progress.

If the buyer strongly resists a shorter window or refuses milestone based extensions, that response gives you useful information. It may indicate that the buyer wants the protection of exclusivity without committing to a disciplined timetable.

Common Founder Mistakes

• Treating exclusivity as paperwork for the “real” agreement: Founders sometimes sign the LOI simply to keep the transaction moving and assume the definitive agreement is where the serious negotiation begins. By signing exclusivity first, they may already have surrendered an important source of negotiating leverage.
• Accepting an unusually long or open ended period: A buyer may request 90 or 120 days because it wants additional time. Agreeing without conditions can leave you exposed if diligence slows down or the buyer later tries to renegotiate the price.
• Granting exclusivity before testing the market: Founders sometimes accept the first serious offer without speaking with other credible buyers. Research from the Program on Negotiation supports a more disciplined approach: consider exhausting discussions with promising alternatives before giving one buyer exclusive access.

10-Minute Exclusivity Self-Check

• Have you spoken with other credible buyers before agreeing to exclusive negotiations with this buyer?
• Does the exclusivity clause contain a specific and reasonable expiration date?
• Must the buyer complete defined diligence milestones to keep exclusivity active?
• Will the buyer reimburse costs or pay a breakup fee if it walks away without cause?
• Has your counsel reviewed the exclusivity language rather than focusing only on the purchase price?

If you cannot answer yes to all questions, you may not be ready to sign the LOI.

Bottom Line

Exclusivity is a trade. You give up your ability to pursue other buyers in exchange for a buyer’s commitment to continue negotiating toward a transaction.

That trade can be worthwhile when the buyer is serious, the price is strong, and the path to closing is clear.

But a 90 day exclusivity period should not become an automatic concession.

Set a firm expiration date. Tie extensions to measurable diligence milestones. Consider a breakup fee or expense reimbursement. And test the market before giving one buyer control of your exit process.

Your LOI is not just a statement of intent. Its exclusivity terms can affect your leverage for months.

Ready to Review Your LOI Before You Sign Away Your Leverage?

Schedule a free 30-minute call with our team to discuss your LOI, exclusivity terms, and concerns before you commit.

Book here: https://calendly.com/primumlaw/30min