OTCBB Shells – The Reverse Merger Process – Part III

Submitted By Ralph Amato

Purchasing the Shell

The protocol for purchasing an OTCBB shell is as follows:

  1. Buyer will receive a “Corporate Shell Profile” from the Seller or Sellers Representative.

  2. After a successful review of the shell by Buyers and his SEC attorney Buyer will enter into Letter of Intent (“LOI”) for the purchase of the shell.

  3. Buyer will remit a 10 day refundable deposit (usually $100,000) that will be held by an escrow agent.

  4. Seller will remit all due diligence to Buyers attorney.

  5. Within 10 days Buyers attorney will finalize his due diligence and decide to move forward with the transaction and close in 4 additional days or reject the shell and ask for the deposit to be refunded.

  6. If Buyer proceeds with the purchase of the shell then Buyers attorney will submit Stock Purchase Agreements (“SPA”) to be signed by the Buyer and Sellers.

  7. Buyer will remit remaining purchase price to escrow agent.

  8. Seller will remit to escrow agent stock certificates with signed stock powers with gold medallion guarantee.

  9. Escrow agent will forward all final signatured documents along with stock certificates with stock powers to Buyers attorney for final examination.

  10. Escrow agent will release funds to Sellers.


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