A definitive agreement is the binding contract that consummates an acquisition, typically negotiated over 6 to 12 weeks after the LOI is signed. It is also called a definitive purchase agreement, DPA, merger agreement, or stock purchase agreement depending on deal structure. It covers the final negotiated purchase price, the transaction structure, representations and warranties, indemnification provisions, escrow holdbacks, closing conditions, and post-close covenants. It is the document that turns the LOI's non-binding intentions into legally enforceable terms, and the negotiation phase where the headline price quietly moves by 10 to 30 percent in either direction depending on what due diligence reveals.
The major sect...