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Appellate Advocacy Keyed to Meador, 2nd Ed.
I.M.A. v. Rocky Mountain Airways, Inc.
Citation:
713 P.2d 882 (1986)Facts
In 1977, I.M.A. began service as a commercial airline between Denver and Durango, Colorado, operating under a certificate of public convenience and necessity issued by the Colorado Public Utilities Commission (PUC). By 1978, I.M.A. faced severe financial difficulties and ceased operations without PUC approval. After initial discussions with Aspen Airways about a potential takeover, I.M.A. shifted to negotiations with Rocky Mountain, which expressed interest in acquiring I.M.A. to obtain its PUC certificate.
On August 1, 1978, the presidents of both companies signed a “Letter of Intent and Agreement” drafted by Rocky Mountain, stating Rocky Mountain’s intention to acquire I.M.A.’s assets through acquisition of all outstanding stock. As consideration, Rocky Mountain agreed to assume I.M.A.’s liabilities (estimated at $100,000) and pay passenger fees to I.M.A. shareholders up to $300,000 over five years. The letter stated it was “preliminary in nature” and listed five contingencies upon which the agreement was dependent.
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