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Stock Purchase Agreement Term Sheet for Philippines

Stock Purchase Agreement Term Sheet Template for Philippines

A Stock Purchase Agreement Term Sheet is a preliminary document that outlines the key terms and conditions for a proposed acquisition of shares in a Philippine corporation. This document, governed by Philippine law, serves as a roadmap for the subsequent definitive agreement and captures essential elements such as purchase price, payment terms, conditions precedent, and key transaction milestones. While generally non-binding except for specific provisions like confidentiality and exclusivity, it provides a framework for negotiations and due diligence processes, incorporating requirements under Philippine corporate and securities laws.

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What is a Stock Purchase Agreement Term Sheet?

The Stock Purchase Agreement Term Sheet is a crucial preliminary document used in Philippine corporate transactions when parties are negotiating the sale and purchase of shares in a company. It serves as a foundation document that precedes the definitive stock purchase agreement, typically used after initial discussions but before detailed due diligence begins. The term sheet captures the material terms of the proposed transaction, including price, payment structure, conditions, and timeline, while considering Philippine regulatory requirements under the Revised Corporation Code and Securities Regulation Code. While most provisions are non-binding, certain sections like confidentiality and exclusivity are typically binding. The document is particularly important in the Philippine context as it helps parties align their expectations and identify potential regulatory hurdles early in the transaction process, especially regarding foreign ownership restrictions and required governmental approvals.

What sections should be included in a Stock Purchase Agreement Term Sheet?

1. Parties: Identification of the seller(s), purchaser(s), and the target company

2. Background: Brief context of the proposed transaction and current ownership structure

3. Definitions: Key terms used throughout the term sheet

4. Transaction Overview: High-level description of the proposed stock purchase transaction

5. Purchase Price: Proposed purchase price, payment structure, and any adjustments

6. Payment Terms: Timeline and method of payment, including any escrow arrangements

7. Conditions Precedent: Key conditions that must be met before closing

8. Due Diligence: Scope and timeline for due diligence investigation

9. Confidentiality: Terms regarding confidential information sharing and announcement restrictions

10. Exclusivity: Period during which seller cannot negotiate with other potential buyers

11. Timeline: Expected dates for key milestones including signing, due diligence, and closing

12. Governing Law: Specification of Philippine law as governing law and jurisdiction

What sections are optional to include in a Stock Purchase Agreement Term Sheet?

1. Purchase Price Adjustment: Detailed mechanisms for post-closing adjustments based on working capital, earnings, or other metrics

2. Management Retention: Terms for retaining key management personnel, used when continuity of management is crucial

3. Non-Competition: Restrictions on seller's future competitive activities, included when seller is a strategic player

4. Break-up Fee: Fee payable if either party terminates negotiations, used in larger transactions

5. Foreign Investment Provisions: Special provisions required when buyer is foreign, addressing ownership restrictions

6. Regulatory Approvals: Section outlining required regulatory approvals, included when transaction requires specific government clearances

7. Employee Matters: Treatment of employees post-closing, included when significant workforce is involved

8. Intellectual Property: Special provisions for IP transfers, included when IP is a significant asset

What schedules should be included in a Stock Purchase Agreement Term Sheet?

1. Appendix A - Corporate Structure: Current and post-closing ownership structure diagrams

2. Schedule 1 - Key Terms Summary: Executive summary of principal transaction terms

3. Schedule 2 - Timeline: Detailed timeline of key dates and milestones

4. Schedule 3 - Required Consents: List of third-party and regulatory consents required

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Philippines

Publisher

Genie AI

Cost

Free to use
Relevant legal definitions

































Clauses




























Relevant Industries

Banking & Finance

Technology

Manufacturing

Real Estate

Retail

Healthcare

Energy

Telecommunications

Mining

Agriculture

Construction

Transportation & Logistics

Professional Services

Consumer Goods

Media & Entertainment

Relevant Teams

Legal

Finance

Corporate Development

Mergers & Acquisitions

Strategy

Investment

Executive Leadership

Treasury

Compliance

Corporate Secretariat

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Corporate Lawyer

Legal Counsel

Investment Banker

Business Development Manager

Mergers & Acquisitions Director

Corporate Secretary

Financial Controller

Managing Director

Private Equity Manager

Chief Legal Officer

Chief Strategy Officer

Investment Director

Transaction Advisory Manager

Industries







Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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