CONVENTIONAL PENALTY Clause Samples
A Conventional Penalty clause establishes a predetermined financial penalty that one party must pay if they fail to fulfill specific contractual obligations. Typically, this clause applies to breaches such as late delivery, non-performance, or failure to meet agreed standards, with the penalty amount set in advance within the contract. Its core practical function is to provide certainty and deterrence by clearly defining the consequences of non-compliance, thereby streamlining enforcement and reducing disputes over damages.
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CONVENTIONAL PENALTY. (1) A contractual partner, which breaches the obligations according to § 3, § 4 or § 5 (debtor), has to pay a conventional penalty to the other contractual partner (creditor) for each breach of an obligation by waiving the plea of the continuation context. The conventional penalty for breaches of § 3, § 4 § 5 Par. 1 is between EUR 50,000.00 and EUR 500,000.00. It has to cor- respond with reasonable discretion within this framework. Decisive for this are the significance of the breached obligation, the disadvantage of the creditor (also the intangible disadvantage) and the degree of the breach of obligation and the fault of the debtor. If the contractual part- ners cannot reach an agreement in this respect then a judge of the Higher Regional Court Frankfurt am Main, who is appointed by the President of the said Higher Regional Court, shall make a binding decision in this respect as an arbitrator after hearing the contractual partners (also only in writing).
(2) For the event of a breach of § 5 Par. 2 the conventional penalty shall amount to three gross monthly salaries, as the employee most recently had to receive (with variable remuneration based on the last full 12 calendar months). With a successful poaching the conventional penal- ty will be twice the amount.
CONVENTIONAL PENALTY. In the event of any type of damage (be it material or reputational) to the VENUE, to other EXHIBITORS, THE EVENT owner and THE ORGANIZER, THE EXHIBITOR may be charged a conventional penalty equivalent to the sum of his/her contract fee, as specified in the Exhibitor’s Manual. This penalty will be applied by THE ORGANIZER when bad behavior is not corrected or when called-for measures are not taken. Furthermore, the Contract may be rescinded and THE EXHIBITOR asked to leave THE EVENT. Any complaint or disagreement on the part of THE EXHIBITOR in relation to the terms specified in this instrument or the service provided by THE ORGANIZER or any of THE ORGANIZER’s suppliers should be reported in writing to THE ORGANIZER within 15 (fifteen) days of being billed. Once that period of time has passed, it will be assumed that THE EXHIBITOR is happy with the terms contained in the contract and/or the service provided and for that reason has renounced the right to make any claim subsequently. Any complaint or disagreement raised by THE EXHIBITOR with THE ORGANIZER does not excuse the former from making any outstanding payments owed to the latter.
CONVENTIONAL PENALTY. Both Parties acknowledge that the performance of the Service Levels agreed in this Agreement and in the EXHIBIT "G" is a very important factor and any default of said Service Levels could cause damages and losses to the affected Party, whose quantification is not viable to do in this moment. Therefore, in case any of the Parties breaches the agreed Service Levels shall pay to the affected Party for a conventional penalty the amount specified in the EXHIBIT "G". The payment of such amounts does not discharge the Party in breach from its obligation of complying its obligations.