Global Exposure Cap Clause Samples
A Global Exposure Cap clause sets an upper limit on the total financial liability that one party may incur under a contract, regardless of the number or type of claims made. Typically, this cap is expressed as a fixed amount or as a percentage of the contract value, and it applies collectively to all claims arising from breaches, indemnities, or other obligations. By establishing a maximum exposure, this clause provides certainty and risk management for the parties, ensuring that potential losses are predictable and do not exceed an agreed threshold.
Global Exposure Cap. (a) During the period commencing on the Effective Date and ending December 29, 2010, (i) the Probable Unsecured Exposure, as calculated (or, to the extent applicable, estimated) by GMAC in good faith, shall not on any given day exceed $2.1 billion and (ii) the Maximum Unsecured Exposure, as calculated (or, to the extent applicable, estimated) by GMAC in good faith, shall not on any given day exceed $4.1 billion.
(b) From and after December 30, 2010, (i) the Probable Unsecured Exposure, as calculated (or, to the extent applicable, estimated) by GMAC in good faith, shall not on any given day exceed $1.5 billion and (ii) the Maximum Total Exposure, as calculated (or, to the extent applicable, estimated) by GMAC in good faith, shall not on any given day exceed the greater of (A) $3.0 billion and (B) 15% of the Capital of GMAC. CONFIDENTIAL TREATMENT [***] Indicates that text has been omitted which is the subject of a confidential treatment request. This text has been separately filed with the Securities and Exchange Commission
(c) If GMAC determines, at any time, that the amount of any Measured Exposure equals or exceeds 97% of the Cap then applicable to such Measured Exposure, GMAC and GM will immediately engage in discussions to ensure that the amount of the applicable Measured Exposure is maintained below such Cap. If the Cap with respect to a Measured Exposure has been exceeded, then, until GM or any other GM Entity (i) makes a payment in cash (an “Exposure Reduction Cash Payment”) to GMAC or any other GMAC Entity and/or (ii) reduces the amount of undrawn commitments of the GMAC Entities under the GMAC Debt Facilities to provide loans to GM Entities (a “Commitment Reduction”) such that, after giving effect to such Exposure Reduction Cash Payment and/or such Commitment Reduction and any additional obligations about to be incurred, the applicable Measured Exposure does not exceed such Cap, or any other event occurs as a result of which the applicable Measured Exposure no longer exceeds such Cap, the GMAC Entities will not be obligated to lend, otherwise extend any credit, or make any other financial accommodations, or otherwise increase any GMAC Entity’s exposure to any GM Entity. The preceding sentence does not in any way limit or otherwise restrict any of GMAC’s other rights or obligations under any other provision of this Agreement or any other agreement. Notwithstanding anything to the contrary in this Section 4, the GM Entities’ obligation to not exceed...
Global Exposure Cap. (a) During the period commencing on the Effective Date and ending December 29, 2010, (i) the Probable Unsecured Exposure, as calculated (or, to the extent applicable, estimated) by GMAC in good faith, shall not on any given day exceed $2.1 billion and (ii) the Maximum Unsecured Exposure, as calculated (or, to the extent applicable, estimated) by GMAC in good faith, shall not on any given day exceed $4.1 billion.