The Locked Box Mechanism in Share Purchase Agreements: Achieving Price Certainty and Leakage Protection
EXECUTIVE SUMMARY The Locked Box mechanism delivers price certainty and accelerated closing, but transfers economic risk to the buyer from the Lockbox Date. The definition of “Leakage” is the single most important negotiated term, and loose drafting costs the buyer directly from the price. The Locked Box mechanism has become the preferred structure in […]