Certain Caps on Indemnification Liability Clause Samples
The "Certain Caps on Indemnification Liability" clause sets a maximum limit on the amount one party may be required to pay to the other as indemnification for losses or damages under the contract. Typically, this cap is expressed as a fixed dollar amount or as a percentage of the contract value, and may exclude certain types of claims, such as those arising from fraud or willful misconduct. By establishing these limits, the clause provides predictability and risk management for both parties, ensuring that potential indemnification obligations remain within agreed boundaries and do not expose either side to unlimited financial liability.
Certain Caps on Indemnification Liability. The aggregate Liability of the Principal Stockholders under this Section 6.3 in respect of a misrepresentation or inaccuracy in, or breach of, any representation or warranty in Article 3 (other than the Specified Representations and other than any representations or warranties relating, or subject, to Indemnification Claims based on willful misconduct or fraud) shall not exceed the sum of (i) the amount, if any, paid or payable from the Indemnity Escrow for any and all Share Ownership Claims, Working Capital Escrow Amount Claims, Dissenters’ Rights Claims, and Indemnification Claims in respect of any of the Specified Representations, any 401(k) Claims or any ESOP/DC Plan Claims or based on willful misconduct or fraud and (ii) the amount, if any, paid or payable from the Indemnity Escrow in respect of the representations and warranties in Article 3 other than those representations and warranties that may be the subject of any of the enumerated claims in the immediately preceding clause (i). Notwithstanding anything herein to the contrary, in no event shall the aggregate Liability of the Principal Stockholders under Sections 6.3 and 6.7, including their proportionate share of amounts paid to Buyer Indemnified Parties out of the Indemnity Escrow, exceed the sum of (x) the amount of the Working Capital Indemnity Amount, if any, and (y) 50% of the amount of the aggregate Merger Consideration received by the Stockholders. Notwithstanding anything herein to the contrary, the aggregate Liability of Buyer and Buyer’s Parent to Stockholder Indemnified Parties shall not exceed $5,000,000.
Certain Caps on Indemnification Liability. Except for Share Ownership Claims and claims based on Seller's fraud, the aggregate Liability of Seller under this Section 5.2 in respect of a misrepresentation or inaccuracy in, or breach of, any representation or warranty referenced in clause (b) of Section 5.2.1 shall not exceed $4,500,000. In no event shall the total indemnification Liability of Seller under this Agreement (including all such Liability under this Section 5.2, Liability for Share Ownership Claims, Liability for claims based on Seller's fraud, and Liability claims based on Taxes under Section 5.6) exceed in the aggregate the cash amount paid or payable to Seller in respect of the Purchase Price. Furthermore, until the IPP Escrow Amount, minus the amount of pending Indemnification Claims against such funds under this Section 5.2, is not greater than zero, Buyer Indemnified Parties shall be entitled under this Section 5.2 only to look to the IPP Escrow Amount for indemnification of their claims.
Certain Caps on Indemnification Liability. Except for Share Ownership Claims, Indemnification Claims in respect of Sections 3.12 or 3.13 and claims based on intentional acts, willful misconduct or fraud, the aggregate Liability of Sellers under this Section 6.3 in respect of a misrepresentation or inaccuracy in, or breach of, any representation or warranty in Article 3 or in the certificates delivered pursuant Section 7.2.1 shall not exceed the sum of (i) 15% of the Purchase Price and (ii) the amount, if any, paid or payable from the Initial Purchase Price Escrow for any one or more Share Ownership Claims, Indemnification Claims in respect of Sections 3.12 or 3.13 or for claims based on intentional acts, willful misconduct or fraud. Furthermore, until the Initial Purchase Price Escrow, minus the amount of pending Indemnification Claims against such funds under this Section 6.3 is not greater than zero, Buyer Indemnified Parties shall only be entitled under this Section 6.3 in respect of a misrepresentation or inaccuracy in, or breach of, any representation or warranty in Article 3 or in the certificates delivered pursuant Section 7.2.1 for the satisfaction of their Indemnification Claims to payments from the Initial Purchase Price Escrow. Notwithstanding anything herein to the contrary, the aggregate Liability of Buyer and Parent to Seller Indemnified Parties hereunder shall not exceed 100% of the Purchase Price.
Certain Caps on Indemnification Liability. Notwithstanding anything herein to the contrary, (a) the aggregate Liability of the Shareholders to Buyer Indemnified Parties for all Indemnification Claims under this Section 6.3 and Sections 6.7 and 6.17 shall not exceed $7,500,000, (b) the aggregate Liability of Buyer and Buyer’s Parent to Shareholders Indemnified Parties for all Indemnification Claims under this Section 6.3 and 6.7 shall not exceed $7,500,000, and (c) no Principal Shareholder shall be liable, in any case, for more than such Shareholder’s Pro Rata Share of any Losses for Indemnification Claims under this Section 6.3 and Sections 6.7 and 6.17.
Certain Caps on Indemnification Liability. Except for Core Representation Claims and claims based on fraud by any Seller, the aggregate Liability of Sellers under this Section 6.3 in respect of a misrepresentation or inaccuracy in, or breach of, any representation or warranty referenced in clause (c) of the first sentence of Section 6.3.1 shall not exceed $8,000,000. In no event shall the total indemnification Liability of Sellers under this Agreement (including all such Liability under this Section 6.3, Liability for Core Representation Claims, Liability for claims based on fraud by any Seller, and Liability claims based on Taxes under Section 6.7) exceed in the aggregate the cash amount paid or payable to Sellers in respect of the Purchase Price. Furthermore, except with respect to Ownership, Tax and SBA Claims and claims based on fraud by any Seller, until the IPP Escrow Amount, minus the amount of pending Indemnification Claims against such funds under this Section 6.3, is not greater than zero, Buyer Indemnified Parties shall be entitled under this Section 6.3 only to look to the IPP Escrow Amount for Indemnification Claims in respect of a misrepresentation or inaccuracy in, or breach of, any representation or warranty referenced in clause (c) of Section 6.3.1.
Certain Caps on Indemnification Liability. Except for Excepted Claims, (a) the aggregate Liability of the Company and Stockholders under this Section 6.3 in respect of (i) a breach of any Pre-Closing Covenant and (ii) a misrepresentation or inaccuracy in, or breach of, any representation or warranty in Article 3 (including any updated Article 3 Schedules) (clauses (a) and (b) collectively, the “Capped Claims”) shall not exceed (1) the Escrow Payment, plus any interest and other income earned thereon, and (2) the amount, if any, paid from the Escrow for any one or more Excepted Claims, and (b) Parent Indemnified Parties shall only be entitled under this Section 6.3 for indemnification of their Losses attributable to Capped Claims from the Escrow, except, if any, amounts are paid from the Escrow for Excepted Claims, the Company and Stockholders shall be jointly and severally liable for Losses attributable to Capped Claims in an aggregate amount not to exceed such Losses attributable to Excepted Claims paid from the Escrow. Notwithstanding anything herein to the contrary, the total Liabilities of the Parent Indemnifying Parties under this Agreement shall not exceed the Purchase Price, as adjusted pursuant to Section 2.2.