Form 16-1: Letter of Intent to Enter into Stock Purchase Agreement for 100% of Stock of Privately Held Operating Business

​

Cash Base Price at Closing Plus Incentive Price Payable in Installments Based upon Earnout Formula

 

(9 pages)

​

$25

​

Form addresses: 

• Scheduled closing date.

• Purchase price (Base Price of cash and installments).

• Incentive Price (installments contingent upon the target company's revenues).

• Uncollectible accounts receivable credited against Base Price.

• Security: pledge of company's stock.

• Indemnity.

• Representations and warranties (extensive).

• Stock purchase agreement.

• Contingencies.

• Due diligence.

• Compliance with securities laws.

• Covenants not to compete.

• Company's covenants.

• Liquidated damages.

• Broker fees.