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PLAYBOOK TEMPLATES
Reseller Distribution Agreement
A Reseller or Distribution Agreement governs how products are marketed and sold through intermediaries, defining territories, pricing, and performance expectations. This playbook explains negotiation levers around exclusivity, revenue targets, and brand protection.
Limitation of Liability
Negotiation strategy
Negotiate for a liability cap that reflects the contract's value and risk profile. Ensure carve-outs for fraud and personal injury are included.
Aim to limit liability to a specific amount or percentage of the contract value. Agree to carve-outs only for significant liabilities like fraud.
Essential elements
1
Liability Cap
Maximum financial exposure limit.
2
Carve-Outs
Exclusions for specific liabilities.
3
Contract Value Percentage
Cap as a percentage of value.
Action framework
ACCEPT
Propose edits if the cap is too high or lacks necessary carve-outs.
EDIT
Reject if the clause imposes unlimited liability without exceptions.
ADD
Add language to include carve-outs for fraud and personal injury.
PRO TIP
Always align liability caps with the contract's risk and value to protect financial interests.
Real-world examples
FAVORABLE
Reasonable Liability Cap
"The liability of [Party] under this Agreement shall not exceed 10% of the total contract value, except in cases of fraud, gross negligence, or personal injury."
NEUTRAL
Standard Liability Clause
"The liability of [Party] shall be limited to $100,000, excluding liabilities arising from fraud or personal injury."
UNFAVORABLE
Unlimited Liability
"The liability of [Party] is unlimited and includes all types of damages."
Alternative scenarios & positions
High-Risk Projects
For high-risk projects, ensure the liability cap is thoroughly evaluated to protect both parties from excessive exposure.
Low-Value Contracts
In low-value contracts, a fixed cap may suffice, but ensure it covers potential risks adequately.
International Agreements
Consider jurisdictional differences in liability laws when setting caps in international agreements.
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WEEK 3
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WEEK 4
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