Caps and Baskets Clause Samples
The "Caps and Baskets" clause sets limits on the amount and types of damages that can be claimed under a contract, particularly in the context of indemnification or liability. In practice, a "cap" establishes a maximum dollar amount that one party can be required to pay, while a "basket" sets a threshold amount of losses that must be reached before a party is obligated to compensate the other. For example, a basket might require that losses exceed $50,000 before any indemnification is owed, and a cap might limit total liability to $1 million. This clause is essential for managing and allocating risk between parties, ensuring that neither side faces unlimited or unpredictable financial exposure.
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Caps and Baskets. Neither Buyer, on the one hand, nor Sellers, on the other hand, shall be obligated to provide indemnification for claims breaches of representations and warranties under Section 10.2(a) or Section 10.3(a), as the case may be, until the aggregate dollar amount of any Losses subject to indemnification by Buyer or Sellers for breaches of representations and warranties, as the case may be, exceeds $50,000 (the “Basket”), provided, however that the Basket shall not apply to such breaches of Sections 5.1 (Authorization), 5.4 (Title) or 5.9 (Tax Matters). In the event that the aggregate amount of all such Losses for breaches of representations and warranties exceeds the Basket, then the party from whom indemnification is sought (the “Indemnifying Party”) shall indemnify (subject to the other limitations set forth in this Article X) the party seeking indemnification (the “Indemnified Party”) for the aggregate amount of all such Losses in excess of the Basket. The maximum obligation for each of Sellers, on the one hand, and Buyer, on the other hand, from and against all Losses from breaches of representations and warranties shall not exceed $1,250,000 (the “Cap”); provided, however that the Cap shall not apply to a breach of Sections 5.1 (Authorization), 5.4 (Title) or 5.9 (Tax Matters).
Caps and Baskets. No claim for indemnification shall be made unless the aggregate amount of all such claims exceeds $100,000 (the “Basket”), in which case the indemnifying Party shall be liable for the full amount of such claims up to an aggregate maximum equal to the total value of the Spectral Shares issued hereunder (the “Cap”).
Caps and Baskets. Neither Buyer, on the one hand, nor Seller, on the other hand, shall be obligated to provide indemnification for claims under Section 9.1(a) or Section 9.1(b), as the case may be, until the aggregate dollar amount of any Losses subject to indemnification by Buyer or Seller, as the case may be, exceeds the amount equal to three million dollars ($3,000,000) (the “Basket”); provided, that, for purposes of determining whether the Basket has been met or exceeded, claims for Losses arising from a single event or a group or series of related events that are, individually or in the aggregate, less than one hundred thousand dollars ($100,000) shall be excluded. In the event that the aggregate amount of such Losses exceeds the Basket, then the Indemnifying Party shall indemnify (subject to the other limitations set forth in this Article IX) the Indemnified Party for the aggregate amount of all such Losses in excess of the Basket. In no event shall the Basket apply to Losses of any Indemnified Party in connection with, arising out of or resulting from (i) breaches of any Fundamental Representations, (ii) Section 9.1(a)(i)(B)-(D), (iii) Section 9.1(b)(i)(B) or (iv) Section 9.2. The maximum obligation for each of Seller and Buyer from and against all such Losses and the maximum amount of indemnification pursuant hereto shall not exceed forty-five million dollars ($45,000,000) (the “Indemnification Cap”); provided that the Indemnification Cap shall not apply to Losses of any Buyer Indemnitees or Seller Indemnitees in connection with, arising out of or resulting from (i) breaches of any Fundamental Representations, (ii) Section 9.1(a)(i)(B)-(D), (iii) Section 9.1(b)(i)(B) or (iv) Section 9.2.