Preliminary Sale Agreement Template for Philippines

The Preliminary Sale Agreement is a crucial document used in Philippine business transactions when parties wish to formalize their intention to proceed with a sale but need to establish certain conditions or conduct due diligence before finalizing the transaction. This document type is particularly important in complex transactions where parties need time to verify information, secure financing, or obtain regulatory approvals. The agreement, while not the final sale contract, creates binding obligations under Philippine law regarding the proposed transaction's framework. It typically includes provisions for exclusivity, confidentiality, and the conditions under which parties may proceed to, or withdraw from, the final sale. The document must comply with Philippine Civil Code requirements and may need to address specific regulatory requirements depending on the transaction's nature.

1. Parties: Identifies and provides complete details of the seller and buyer, including their legal names, addresses, and any relevant registration numbers

2. Background: Contextualizes the agreement and explains the parties' intention to enter into a future definitive sale agreement

3. Definitions: Defines key terms used throughout the agreement to ensure clarity and prevent misinterpretation

4. Subject Matter of Sale: Detailed description of the property or goods to be sold, including specific characteristics and quantity

5. Purchase Price: States the agreed purchase price and any applicable taxes or adjustments

6. Payment Terms: Outlines the payment schedule, including any deposits or earnest money requirements

7. Due Diligence: Specifies the buyer's right to conduct due diligence and the seller's obligations to provide necessary information

8. Conditions Precedent: Lists conditions that must be satisfied before proceeding with the final sale

9. Timeline: Establishes key dates and deadlines for the preliminary agreement and subsequent final sale

10. Representations and Warranties: States the parties' representations regarding their authority and the subject matter of sale

11. Termination: Specifies circumstances under which the agreement may be terminated and the consequences

12. Governing Law and Jurisdiction: Establishes that Philippine law governs the agreement and specifies jurisdiction for dispute resolution

13. Execution: Formal closing section for signatures and witness requirements