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1986, “subject to negotiation of definitive documentation and
normal conditions to closing.”
On August 5, 1986, Inspiration’s board of directors ratified
and retroactively approved the nonbinding letter of intent
between Inspiration and Merrill Parent. The board of directors
authorized the executive committee of the board of directors to
“take any and all necessary or desirable actions in connection
with the proposed acquisition of” ML Leasing.
F. Further Negotiations Between Petitioner and Inspiration
On August 19, 1986, Inspiration wrote a letter to Mr. Sands
explaining that “Several problems have arisen over the past few
weeks” regarding the purchase of ML Leasing. In the letter,
Inspiration advised that it was unable “to finance this
transaction on a secured basis within the timeframe and terms of
our agreement.” Inspiration stated that it had started to review
alternative means of financing, including both unsecured
financing and the sale of specific leases from the ML Leasing
portfolio as a means of financing the transaction and suggested
that the increased cost of the unsecured financing “may justify a
downward adjustment in the purchase price.” In the letter,
Inspiration requested that the terms of the draft stock purchase
agreement be altered to accommodate alternative means of
financing; i.e., by eliminating a provision in the draft stock
agreement that prohibited Inspiration from selling significant
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