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PLAYBOOK TEMPLATES
Warranty Service Agreement
A Warranty Service Agreement details how defects, repairs, and replacements are handled during a product’s warranty period. This playbook emphasizes negotiating fair remedies, service levels, and liability limitations that align with operational realities.
Table of Contents
Indemnification & Liability
Negotiation strategy
Negotiate for mutual indemnities that cover breaches and third-party claims. Ensure liability caps are reasonable and exclusions are clearly defined to protect the company's interests.
Aim to limit indemnification to direct damages and negotiate for a liability cap that aligns with the contractor's risk tolerance. Exclude consequential damages where possible.
Essential elements
1
Indemnification Scope
Defines covered claims and breaches.
2
Liability Cap
Sets maximum financial exposure.
3
Exclusions
Specifies non-covered damages.
Action framework
ACCEPT
Propose edits when mutual indemnities or liability caps are unclear or absent.
EDIT
Reject clauses that impose unlimited liability or lack mutual indemnities.
ADD
Add language to include liability caps and specific exclusions.
PRO TIP
Always ensure indemnities are mutual and cover all relevant breaches and claims.
Real-world examples
FAVORABLE
Preferred Indemnification Clause
"Each party shall indemnify and hold harmless the other party from any third-party claims arising from breaches of this agreement, subject to a liability cap of [specified amount] and exclusions for [specified exclusions]."
NEUTRAL
Fallback Indemnification Clause
"Indemnification shall be limited to direct damages and capped at [specified amount], excluding consequential damages."
UNFAVORABLE
Unlimited Liability Clause
"The contractor shall indemnify the company for all claims without any cap on liability."
Alternative scenarios & positions
High-Risk Projects
In high-risk projects, consider increasing liability caps and expanding indemnification to cover additional risks.
International Contracts
Adjust indemnification terms to comply with jurisdiction-specific legal requirements and ensure mutual understanding.
Small-Scale Agreements
For smaller agreements, simplify indemnification terms and set lower liability caps to reflect reduced risk.
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WEEK 3
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WEEK 4
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