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PLAYBOOK TEMPLATES

Hospitality Hotel Contract

A Hospitality Hotel Contract covers management, operation, or branding arrangements in the hospitality sector. This playbook guides negotiation of performance benchmarks, termination rights, and brand compliance.

Liability & Indemnification

Why This Matters: Balanced indemnification and liability caps safeguard against excessive exposure and minimize the risk of unpredictable liabilities.

Negotiation strategy

If you're the Owner:

Negotiate to limit indemnity obligations to direct losses and ensure a reasonable monetary cap is in place. Advocate for mutual indemnities to fairly distribute risk.

If you're the Operator:

Ensure indemnity clauses are reciprocal and include carve-outs for gross negligence. Aim to set a cap that aligns with industry standards.

Essential elements

1

Indemnity for Direct Losses

Limits indemnity to direct losses.
2

Monetary Cap on Indemnity

Sets a maximum liability cap.
3

Mutual Indemnities

Reciprocal indemnity for third-party claims.

Action framework

ACCEPT

Propose edits to align indemnity with business goals, focusing on direct losses and appropriate caps.

EDIT

Reject clauses that impose unlimited liability or lack mutual indemnities.

ADD

Add clauses for direct losses, monetary caps, and mutual indemnities if absent.

PRO TIP

Always ensure indemnity clauses are clear and include specific carve-outs for gross negligence.

Real-world examples

FAVORABLE

Indemnity for Direct Losses

"Each Party (the 'Indemnifying Party') shall indemnify, defend, and hold harmless the other Party (the 'Indemnified Party') from and against any and all claims, damages, losses, and expenses, including but not limited to reasonable attorneys' fees, arising out of or resulting from the Indemnifying Party's performance of this Agreement, but only to the extent caused by the negligent acts or omissions of the Indemnifying Party, its employees, subcontractors, or agents. The indemnity obligation shall be limited to direct losses and shall not include any indirect, incidental, consequential, or punitive damages."
NEUTRAL

Standard Indemnity Clause

"Each Party shall indemnify the other for losses arising from their own negligence."
UNFAVORABLE

Unlimited Indemnity

"Each Party shall indemnify the other for all losses, without limitation."

Alternative scenarios & positions

High-Risk Projects

In high-risk projects, consider increasing the monetary cap and ensuring comprehensive carve-outs for gross negligence.

International Agreements

For international agreements, ensure indemnity clauses comply with local laws and consider currency fluctuations in monetary caps.

Joint Ventures

In joint ventures, mutual indemnities should be carefully balanced to reflect shared responsibilities and risks.

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