Combination purchase agreements

[Andrew Klein]

Hi all, 

I have an interesting off-market deal I am trying to put together that would involve a loan payoff in cash and the remainder of the negotiated property value in stock of a not-listed startup. The seller needs to be an accredited investor because of the securities portion, but here is what I am thinking:

The seller owes $130k and would like to pay off his loan.
The house is worth about $215k. Given today's interest rate environment I am not that interested in paying full value because that is a losing proposition rental-wise, so I am trying to find a way to make it work by working in some other advantages.
I am currently overweight in a startup stock as I was one of the early investors and am hoping to pay off some of the loans I took out to do the initial investing. I also have an unsecured line of credit that would be able to cover the $130k loan.

I am proposing:
Pulling out $130k from my loan and doing a cash purchase of $130k and transferring the remaining $85k in stock value to the seller to purchase the home.

Question are,

How do I account for the stock?

Do I just say consider the purchase price as $130k and transfer the stock almost like a gift? Would the stock then be considered "boot"? How would I account for that?

Do I need to make a sale contract for the stock first? That would be taxable if yes, so I would have to sell a little more to cover my tax liability, right? I have plenty of the startup stock, but this likely wouldn't be worth it if I cannot enact an exchange of some sort that would defer the stock gains.   

Let's say the seller owns his property in an LLC, is there any way I could utilize 1031 exchange rules to exchange partial ownership of the startup for partial ownership of the LLC? Then buy the rest of the LLC out with cash? If it isn't in an LLC yet, could he quit claim deed it to an LLC quick and then run this strategy?

I am low on cash which is why I am considering this. I intend to cash out refinance after the purchase in order to borrow against my stock value. Would that negate anything? Would I need to wait a certain amount of time before borrowing against the house which I am exchanging (at least in part) the stock for? I think a standard 1031 exchange blocks refinance options for some time afterwards. 

What am I not thinking of? I know the SEC rules are pretty lenient as long as the purchaser of the stock is accredited, but combining a deal with real estate is another complication I don't know how to deal with right now. How dangerous are some of these strategy questions? I don't want to run afoul of some other finance law I don't know about yet. But, if there is a way to exchange the partial company ownership for a different asset without causing massive headaches, I would like to explore it. I am sitting on massive value that is not liquid at all and I would like to convert some of that to cash-flowing assets. The seller of the house is interested in hearing more about the stock but would want to buy in with equity in the house rather than cash. How do I make this work?