Sample Indication of Interest (IOI)
A one-page template a buyer can fill in to put preliminary terms in writing.
An indication of interest is often the first written step from a buyer. It comes before the letter of intent and sets out high-level terms. Use the template below as a starting point, and download it as a Word file to send to buyers.
CONFIDENTIAL INDICATION OF INTEREST TEMPLATE
This Indication of Interest (“IOI”) expresses the preliminary interest of [Buyer Entity Name] (“Buyer”) in acquiring [Seller Entity Name] (“Seller”).
This is for discussion purposes only to advance deal discussions to the next level.
| Term | Buyer’s proposal |
|---|---|
| Purchase price | [insert price or range] |
| Deal structure | [asset or stock acquisition] |
| Consideration type | [all cash or mix of cash and Buyer equity] |
| Financing | [source of funds e.g., buyer cash, debt-financing, seller financing] |
| Due diligence | Buyer shall provide a preliminary list of diligence requests to Seller and Seller shall provide Buyer and its advisors with customary diligence materials by [Preliminary Due Diligence Completion Date]. Buyer shall perform confirmatory due diligence following the execution of an LOI and expects to complete all due diligence within [insert timeframe]. |
| Management & employees | The Buyer intends to [specify intentions regarding the retention of management and employees, including any transition arrangements]. |
| Target closing | [MM/DD/YY] |
Confidentiality. The information in this IOI is confidential and is subject to the terms of the Non-Disclosure Agreement executed between Buyer and Seller.
Non-binding. This IOI is for exploratory purposes and does not constitute a legally enforceable contract.
About this IOI
What is it? An IOI is a buyer’s first step: expressing interest and providing high-level transaction terms.
Why use it? You are looking for a commitment to engage in the next level of discussions and bring more than one buyer to the negotiation table. This is a lightweight document to make it easy for a buyer to step forward. It is also a helpful tool to gauge how serious a buyer is, since they will provide a preliminary purchase price in writing.
How to use it? You may have already communicated a deadline or timeline for when you will review offers, or you can ask the buyer to put forward their interest using this template.
Contributors: ExitHero team and Keenan McCullough, MP Law.
This IOI is for educational and informational purposes. Consult a qualified M&A attorney for your unique situation. Last updated January 11, 2024.
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