This column takes a close look at two types of provisions—sandbagging in mergers and acquisitions transactions
and cumulative versus exclusive remedies, a classic boilerplate provision.
Sandbagging
For purposes of this article, let's focus just on cash-financed acquisitions (as opposed to buyer-stock-financed
acquisitions) of privately held companies. In a cash-financed acquisition, the seller makes most of the
representations in order to induce the buyer to purchase the business.
This seller works hard to qualify its representations, for example, by incorporating qualifiers based on knowledge or
materiality. It also tries to qualify its indemnification obligations by negotiating deductibles like baskets and
thresholds. Basically, the seller puts in a lot of blood, sweat and tears (not to mention attorney fees) to negotiate the
stopgaps necessary to reduce its potential financial exposure due to its breach of representation or its failure to
satisfy an important closing condition. A breach of representation occurs when a representation turns out to have
been untrue when made. An example of the latter is the seller's failure to satisfy the "bring-down" closing condition
because a representation that was true when made is no longer true by the closing date.
A seller that works this hard to mitigate definitely wants to know if the buyer (through its superior knowledge or due
diligence) stumbles upon any information that reveals a problem that the seller needs to correct prior to closing.
In most cases, the buyer complies. If the buyer discovers a significant problem before closing, it's usually in the
buyer's best interest to notify the seller, and carefully weigh its options under the acquisition agreement based on,
among other factors, the severity of the problem and its negotiating leverage. It might decide to walk away from (i.e.,
not close) the transaction. In many cases, the parties delay the closing until the seller is able to repair the problem.
In the meantime, the parties just hash it out—the buyer might renegotiate a lower purchase price, a tougher or
dedicated indemnification provision or perhaps additional security (e.g., special escrow) or try to extract some other
concession.
But what happens if the buyer makes the calculated decision to bite its tongue and close the transaction with full
knowledge of a severe breach, only to make a self-righteous indemnification claim after the closing? This practice is
known as "sandbagging," and the above-described premeditated scenario sounds not only unsavory, but also very
risky—the epitome of folly, actually.
Most potential sandbagging cases, however, raise far fewer eyebrows. But that doesn't make them any easier to
resolve. For example, somebody working on the periphery of a deal (i.e., a junior law associate or financial analyst)
obtains routine due diligence access, and misses something subtle but important. Or he flags an issue without fully
understanding its import, and then fails to effectively communicate his reservations up the chain of command. Or
maybe the buyer has an inkling of, but no proof, that the seller has breached the acquisition agreement.
To complicate matters further, in some cases, the buyer's decision whether to take action hinges on the buyer's
subjective interpretation of "materiality." For example, does the apparent deterioration of the seller's financial
condition rise to the level of "MAC" (material adverse change)? Or does "new information" that renders untrue a seller
representation pack enough "materiality" punch to trigger the buyer's right to walk based on the "bring down" closing
condition? This buyer might want to leave well enough alone—why risk wrecking the deal (not just vis-à-vis the
seller, but also any third-party lenders).
As usual, there are two sides to every story. State law varies, so let's focus on the basic logical reasons supporting
the divergent positions.
• Sandbagging Buyer Loses (i.e., Seller not liable for misrepresentation). The logical premise of not holding the
seller accountable for its misrepresentation is that by closing with knowledge of the breach, the buyer could not have
"relied" on the seller's representation in the first place. For example, the used car has 125,000 miles, but the
odometer reads 100,000 miles. The buyer knows that the seller turned the meter back. For whatever reason, the
buyer says nothing, and buys the rust bucket anyway. The buyer should have known better.
• Sandbagging Buyer Wins (i.e., Seller still liable for misrepresentation despite sandbagging buyer). The logical
premise of holding the seller to its word despite a buyer that closes with knowledge of a breach is that, no matter
what, the buyer should get the benefit of the representation that it bargained for. The seller is already protected by
whatever indemnification deductible (i.e., basket or threshold) or liability cap the parties negotiated—the "known"
misrepresentation merely gets counted toward the deductible.
And as usual, an assortment of negotiating tactics muddles an already confusing picture.
• Eleventh Hour Data Dumps. The seller conveniently dumps a pallet full of due diligence documents just before
closing. Invariably, some of the data contradicts some of the seller representations. Or what about the seller that "in
good faith" explicitly notifies the buyer of possible misrepresentations the night before closing? The buyer has a
small window to renegotiate the deal, but decides to close and take a chance on the indemnification.
• Amending Exhibits. The seller negotiates the right to amend its disclosure exhibits before closing. As usual, the
seller waits until just before closing to spring the amended exhibits on the unsuspecting buyer. The buyer can still
walk, but that's cold comfort if it wants to, but no longer has the ability to, close the deal without giving up its right to
indemnification.
Sample Provisions
Now let's take a look at two ways that transactional attorneys deal with sandbagging from a seller's and buyer's
perspective. The seller might draft anti-sandbagging provisions that say the buyer cannot recover under the
indemnification provision if it knew about and said nothing about the seller's misrepresentation prior to closing.
The buyer might draft an anti-anti-sandbagging provision taking the position that the buyer's knowledge is irrelevant.
If the seller makes a misrepresentation, the seller is liable, even if the buyer knew about it before closing. In other
words, the buyer can "sandbag" and still recover under the indemnification provision.
Glenn D. West, a corporate partner at Weil Gotshal & Manges, suggests the following sample language in a seller-
drafted anti-sandbagging provision.
"Effect of Buyer's Knowledge—Notwithstanding anything contained herein to the contrary, Seller shall not have:
(a) any liability for any breach of or inaccuracy in any representation or warranty made by Seller to the extent that
Buyer, any of its Affiliates or any of its or their respective officers, employees, counsel or other representatives
(i) had knowledge at or before the Closing of the facts as a result of which such representation or warranty was
breached or inaccurate; or
(ii) was provided access to, at or before the Closing, a document disclosing such facts;
or
(b) any liability after the Closing for any breach of or failure to perform before the Closing any covenant or obligation of
Seller to the extent that Buyer, or its Affiliates or any of its or their respective officers, employees, counsel or other
representatives
(i) had knowledge at or before the Closing of such breach or failure; or
(ii) was provided access to, at or before the Closing, a document disclosing such breach or failure."
According to Mr. West, an anti-sandbagging provision is almost never appropriate from the perspective of the buyer
because:
• The buyer argues that seller representations are not merely factual assertions. Rather, they are "contractual risk
allocation devices" designed to compensate a buyer if the factual assertions turn out to be incorrect, regardless of
the buyer's purported state of knowledge.
• The seller typically already is protected by provisions that limit the buyer's recourse (i.e., exclusive remedy
provisions).
• The seller typically already is protected by provisions that require the buyer to acknowledge that the buyer has not
relied on any representations other than those stated in the agreement, as well as provisions expressly disclaiming
reliance on extra-contractual representations made by the seller during the negotiations.
• The provision incentivizes the seller to render incomplete disclosure or to engage in 11th hour data dumps (see
above).
Now, let's take a look at a buyer-centric anti-anti-sandbagging provision, which the buyer negotiates to make the
buyer's knowledge irrelevant for purposes of determining the seller's liability. The provision ensures that the buyer
does not waive its right to indemnification even if the buyer has knowledge (through its own due diligence or 11th
hour seller disclosure) of the seller's misrepresentation. In other words, the seller remains liable for its
misrepresentation regardless of the buyer's state of knowledge.
"No Waiver of Contractual Representations and Warranties—Seller has agreed that Buyer's rights to indemnification
for the express representations and warranties set forth herein are part of the basis of the bargain contemplated by
this Agreement; and Buyer's rights to indemnification shall not be affected or waived by virtue of (and Buyer shall be
deemed to have relied upon the express representations and warranties set forth herein notwithstanding) any
knowledge on the part of Buyer of any untruth of any such representation or warranty of Seller expressly set forth in
this Agreement, regardless of whether such knowledge was obtained through Buyer's own investigation or through
disclosure by Seller or another person, and regardless of whether such knowledge was obtained before or after the
execution and delivery of this Agreement."
According to Mr. West, this anti-anti-sandbagging provision "protects the sanctity of the contract in those states that
have common law anti-sandbagging requirements, by ensuring that the 'deal is the deal' regardless of the buyer's
purported state of knowledge," and adds teeth to the bargained-for indemnification provision.
Cumulative Versus Exclusive Remedies
Now let's switch gears and talk about boilerplate. Most contracts contain a cumulative remedies provision. It typically
goes something like this: "all rights and remedies provided in this Agreement are cumulative and not exclusive of
any other rights or remedies that may be available to the parties, whether provided by law, equity, statute, in any other
agreement between the parties or otherwise." This means that in the event of a breach, the aggrieved party can
pursue any remedy in the universe of remedies, including not just the remedies stipulated in the agreement, but also
whatever else (actual damages, equitable remedies, you name it) it can secure in court. In its quest to be made
whole, the aggrieved party gets to throw every potential theory of recovery against the wall and see what sticks.
Despite widespread court recognition of the cumulative remedies concept, many contract parties take a belt and
suspenders approach and add a cumulative remedies provision for good measure (or leave it in the form they inherit
from another transaction). This usually works as long as the parties actually intend for the remedies to be
cumulative, which may not be the case if the parties include an exclusive remedy provision somewhere else in the
contract.
One theme that I like to emphasize is how contract provisions (even boilerplate) allocate risk among the parties. If
the parties agree to a cumulative remedies provision, then they essentially agree to shift the risk of potentially
unchecked liability to the breaching party, which upon initial consideration sounds eminently reasonable. In many
cases, however, the parties spend a lot of time negotiating ways to limit liability, and one of the most popular ways to
do that is to negotiate an exclusive remedy provision, in which the parties agree that the specified remedy will be the
exclusive or sole remedy for the specified breach.
The prototypical example of an exclusive remedy is liquidated damages (LD), which the parties typically negotiate
when they anticipate that actual damages for breach of contract will be difficult to calculate. We'll talk more about the
pitfalls of drafting LD provisions in a future column, but basically, the parties predetermine the amount (usually
based on a sliding scale formula pegged to the type and severity of the breach) to compensate the aggrieved party
(not to penalize the breaching party) for the specified breaches.
A common drafting blind spot is for the parties to enumerate an exclusive remedy provision (like a liquidated
damages provision) AND a cumulative remedies provision. This creates an internal inconsistency that may work to
eviscerate the "exclusivity" of the exclusive remedy, and therefore make available a host of other remedies even after
the aggrieved party takes home its exclusive remedy.
If the contract parties want to reserve the right to pursue cumulative remedies in general, but to allow one or both of
the contract parties to pursue only the enumerated (i.e., exclusive) remedy (e.g., LD) for the specified type(s) of
breach, then the parties need to modify the standard cumulative remedies provision to clarify that the cumulative
remedies provision does not apply in cases where the aggrieved party must pursue the exclusive remedy.
Let's take a look below at a sample "modified" cumulative remedies provision in a hypothetical supply agreement,
which provides that the purchaser must look only to the mandatory price reduction mechanism (a kind of LD)
stipulated elsewhere in the agreement if the manufacturer is no more than 30 days late in delivery. When you read
the sample provision, consider ways to improve it.
"Rights and Remedies Cumulative—The rights and remedies set forth in this Agreement are not exclusive and the
exercise by either party of any right or remedy does not preclude the exercise of any other rights or remedies that may
now or subsequently exist in law or in equity or by statute or otherwise. [Despite the previous sentence, the
mandatory price reduction mechanism stated in Section X is the Purchaser's exclusive remedy for any delivery that is
made no more than 30 calendar days after the Scheduled Delivery Date.]"
While the bracketed carve-out clearly states that the stipulated mandatory price reduction mechanism is the
exclusive remedy for any delivery that is no more than 30 calendar days late, the provision is silent (and therefore
ambiguous) about the purchaser's remedies if the delay continues beyond 30 days. Unless the parties intend in this
case for the purchaser to obtain the discounted goods, plus be able to pursue any and all other remedies, it is better
to state specifically what those remedies are, and then carve the exclusive remedy out of the cumulative remedies
provision.
For more on cumulative versus exclusive provisions, check out "Negotiating and Drafting Contract Boilerplate" (ALM
Publishing, 2002), edited by Tina L. Stark, Professor of the Practice of Law and the head of the new Transactional
Law Program at Boston University School of Law.
Lawrence Hsieh is a corporate attorney and an editor at the Practical Law Company in New York. Lawrence is
also the author of the "Corporate Transactions Handbook."
Reprinted with permission from the August 11, 2011 edition of the New York Law Journal © 2011 ALM Media
Properties, LLC. All rights reserved. Further duplication without permission is prohibited. For information, contact
877-257-3382, reprints@alm.com or visit www.almreprints.com.
and cumulative versus exclusive remedies, a classic boilerplate provision.
Sandbagging
For purposes of this article, let's focus just on cash-financed acquisitions (as opposed to buyer-stock-financed
acquisitions) of privately held companies. In a cash-financed acquisition, the seller makes most of the
representations in order to induce the buyer to purchase the business.
This seller works hard to qualify its representations, for example, by incorporating qualifiers based on knowledge or
materiality. It also tries to qualify its indemnification obligations by negotiating deductibles like baskets and
thresholds. Basically, the seller puts in a lot of blood, sweat and tears (not to mention attorney fees) to negotiate the
stopgaps necessary to reduce its potential financial exposure due to its breach of representation or its failure to
satisfy an important closing condition. A breach of representation occurs when a representation turns out to have
been untrue when made. An example of the latter is the seller's failure to satisfy the "bring-down" closing condition
because a representation that was true when made is no longer true by the closing date.
A seller that works this hard to mitigate definitely wants to know if the buyer (through its superior knowledge or due
diligence) stumbles upon any information that reveals a problem that the seller needs to correct prior to closing.
In most cases, the buyer complies. If the buyer discovers a significant problem before closing, it's usually in the
buyer's best interest to notify the seller, and carefully weigh its options under the acquisition agreement based on,
among other factors, the severity of the problem and its negotiating leverage. It might decide to walk away from (i.e.,
not close) the transaction. In many cases, the parties delay the closing until the seller is able to repair the problem.
In the meantime, the parties just hash it out—the buyer might renegotiate a lower purchase price, a tougher or
dedicated indemnification provision or perhaps additional security (e.g., special escrow) or try to extract some other
concession.
But what happens if the buyer makes the calculated decision to bite its tongue and close the transaction with full
knowledge of a severe breach, only to make a self-righteous indemnification claim after the closing? This practice is
known as "sandbagging," and the above-described premeditated scenario sounds not only unsavory, but also very
risky—the epitome of folly, actually.
Most potential sandbagging cases, however, raise far fewer eyebrows. But that doesn't make them any easier to
resolve. For example, somebody working on the periphery of a deal (i.e., a junior law associate or financial analyst)
obtains routine due diligence access, and misses something subtle but important. Or he flags an issue without fully
understanding its import, and then fails to effectively communicate his reservations up the chain of command. Or
maybe the buyer has an inkling of, but no proof, that the seller has breached the acquisition agreement.
To complicate matters further, in some cases, the buyer's decision whether to take action hinges on the buyer's
subjective interpretation of "materiality." For example, does the apparent deterioration of the seller's financial
condition rise to the level of "MAC" (material adverse change)? Or does "new information" that renders untrue a seller
representation pack enough "materiality" punch to trigger the buyer's right to walk based on the "bring down" closing
condition? This buyer might want to leave well enough alone—why risk wrecking the deal (not just vis-à-vis the
seller, but also any third-party lenders).
As usual, there are two sides to every story. State law varies, so let's focus on the basic logical reasons supporting
the divergent positions.
• Sandbagging Buyer Loses (i.e., Seller not liable for misrepresentation). The logical premise of not holding the
seller accountable for its misrepresentation is that by closing with knowledge of the breach, the buyer could not have
"relied" on the seller's representation in the first place. For example, the used car has 125,000 miles, but the
odometer reads 100,000 miles. The buyer knows that the seller turned the meter back. For whatever reason, the
buyer says nothing, and buys the rust bucket anyway. The buyer should have known better.
• Sandbagging Buyer Wins (i.e., Seller still liable for misrepresentation despite sandbagging buyer). The logical
premise of holding the seller to its word despite a buyer that closes with knowledge of a breach is that, no matter
what, the buyer should get the benefit of the representation that it bargained for. The seller is already protected by
whatever indemnification deductible (i.e., basket or threshold) or liability cap the parties negotiated—the "known"
misrepresentation merely gets counted toward the deductible.
And as usual, an assortment of negotiating tactics muddles an already confusing picture.
• Eleventh Hour Data Dumps. The seller conveniently dumps a pallet full of due diligence documents just before
closing. Invariably, some of the data contradicts some of the seller representations. Or what about the seller that "in
good faith" explicitly notifies the buyer of possible misrepresentations the night before closing? The buyer has a
small window to renegotiate the deal, but decides to close and take a chance on the indemnification.
• Amending Exhibits. The seller negotiates the right to amend its disclosure exhibits before closing. As usual, the
seller waits until just before closing to spring the amended exhibits on the unsuspecting buyer. The buyer can still
walk, but that's cold comfort if it wants to, but no longer has the ability to, close the deal without giving up its right to
indemnification.
Sample Provisions
Now let's take a look at two ways that transactional attorneys deal with sandbagging from a seller's and buyer's
perspective. The seller might draft anti-sandbagging provisions that say the buyer cannot recover under the
indemnification provision if it knew about and said nothing about the seller's misrepresentation prior to closing.
The buyer might draft an anti-anti-sandbagging provision taking the position that the buyer's knowledge is irrelevant.
If the seller makes a misrepresentation, the seller is liable, even if the buyer knew about it before closing. In other
words, the buyer can "sandbag" and still recover under the indemnification provision.
Glenn D. West, a corporate partner at Weil Gotshal & Manges, suggests the following sample language in a seller-
drafted anti-sandbagging provision.
"Effect of Buyer's Knowledge—Notwithstanding anything contained herein to the contrary, Seller shall not have:
(a) any liability for any breach of or inaccuracy in any representation or warranty made by Seller to the extent that
Buyer, any of its Affiliates or any of its or their respective officers, employees, counsel or other representatives
(i) had knowledge at or before the Closing of the facts as a result of which such representation or warranty was
breached or inaccurate; or
(ii) was provided access to, at or before the Closing, a document disclosing such facts;
or
(b) any liability after the Closing for any breach of or failure to perform before the Closing any covenant or obligation of
Seller to the extent that Buyer, or its Affiliates or any of its or their respective officers, employees, counsel or other
representatives
(i) had knowledge at or before the Closing of such breach or failure; or
(ii) was provided access to, at or before the Closing, a document disclosing such breach or failure."
According to Mr. West, an anti-sandbagging provision is almost never appropriate from the perspective of the buyer
because:
• The buyer argues that seller representations are not merely factual assertions. Rather, they are "contractual risk
allocation devices" designed to compensate a buyer if the factual assertions turn out to be incorrect, regardless of
the buyer's purported state of knowledge.
• The seller typically already is protected by provisions that limit the buyer's recourse (i.e., exclusive remedy
provisions).
• The seller typically already is protected by provisions that require the buyer to acknowledge that the buyer has not
relied on any representations other than those stated in the agreement, as well as provisions expressly disclaiming
reliance on extra-contractual representations made by the seller during the negotiations.
• The provision incentivizes the seller to render incomplete disclosure or to engage in 11th hour data dumps (see
above).
Now, let's take a look at a buyer-centric anti-anti-sandbagging provision, which the buyer negotiates to make the
buyer's knowledge irrelevant for purposes of determining the seller's liability. The provision ensures that the buyer
does not waive its right to indemnification even if the buyer has knowledge (through its own due diligence or 11th
hour seller disclosure) of the seller's misrepresentation. In other words, the seller remains liable for its
misrepresentation regardless of the buyer's state of knowledge.
"No Waiver of Contractual Representations and Warranties—Seller has agreed that Buyer's rights to indemnification
for the express representations and warranties set forth herein are part of the basis of the bargain contemplated by
this Agreement; and Buyer's rights to indemnification shall not be affected or waived by virtue of (and Buyer shall be
deemed to have relied upon the express representations and warranties set forth herein notwithstanding) any
knowledge on the part of Buyer of any untruth of any such representation or warranty of Seller expressly set forth in
this Agreement, regardless of whether such knowledge was obtained through Buyer's own investigation or through
disclosure by Seller or another person, and regardless of whether such knowledge was obtained before or after the
execution and delivery of this Agreement."
According to Mr. West, this anti-anti-sandbagging provision "protects the sanctity of the contract in those states that
have common law anti-sandbagging requirements, by ensuring that the 'deal is the deal' regardless of the buyer's
purported state of knowledge," and adds teeth to the bargained-for indemnification provision.
Cumulative Versus Exclusive Remedies
Now let's switch gears and talk about boilerplate. Most contracts contain a cumulative remedies provision. It typically
goes something like this: "all rights and remedies provided in this Agreement are cumulative and not exclusive of
any other rights or remedies that may be available to the parties, whether provided by law, equity, statute, in any other
agreement between the parties or otherwise." This means that in the event of a breach, the aggrieved party can
pursue any remedy in the universe of remedies, including not just the remedies stipulated in the agreement, but also
whatever else (actual damages, equitable remedies, you name it) it can secure in court. In its quest to be made
whole, the aggrieved party gets to throw every potential theory of recovery against the wall and see what sticks.
Despite widespread court recognition of the cumulative remedies concept, many contract parties take a belt and
suspenders approach and add a cumulative remedies provision for good measure (or leave it in the form they inherit
from another transaction). This usually works as long as the parties actually intend for the remedies to be
cumulative, which may not be the case if the parties include an exclusive remedy provision somewhere else in the
contract.
One theme that I like to emphasize is how contract provisions (even boilerplate) allocate risk among the parties. If
the parties agree to a cumulative remedies provision, then they essentially agree to shift the risk of potentially
unchecked liability to the breaching party, which upon initial consideration sounds eminently reasonable. In many
cases, however, the parties spend a lot of time negotiating ways to limit liability, and one of the most popular ways to
do that is to negotiate an exclusive remedy provision, in which the parties agree that the specified remedy will be the
exclusive or sole remedy for the specified breach.
The prototypical example of an exclusive remedy is liquidated damages (LD), which the parties typically negotiate
when they anticipate that actual damages for breach of contract will be difficult to calculate. We'll talk more about the
pitfalls of drafting LD provisions in a future column, but basically, the parties predetermine the amount (usually
based on a sliding scale formula pegged to the type and severity of the breach) to compensate the aggrieved party
(not to penalize the breaching party) for the specified breaches.
A common drafting blind spot is for the parties to enumerate an exclusive remedy provision (like a liquidated
damages provision) AND a cumulative remedies provision. This creates an internal inconsistency that may work to
eviscerate the "exclusivity" of the exclusive remedy, and therefore make available a host of other remedies even after
the aggrieved party takes home its exclusive remedy.
If the contract parties want to reserve the right to pursue cumulative remedies in general, but to allow one or both of
the contract parties to pursue only the enumerated (i.e., exclusive) remedy (e.g., LD) for the specified type(s) of
breach, then the parties need to modify the standard cumulative remedies provision to clarify that the cumulative
remedies provision does not apply in cases where the aggrieved party must pursue the exclusive remedy.
Let's take a look below at a sample "modified" cumulative remedies provision in a hypothetical supply agreement,
which provides that the purchaser must look only to the mandatory price reduction mechanism (a kind of LD)
stipulated elsewhere in the agreement if the manufacturer is no more than 30 days late in delivery. When you read
the sample provision, consider ways to improve it.
"Rights and Remedies Cumulative—The rights and remedies set forth in this Agreement are not exclusive and the
exercise by either party of any right or remedy does not preclude the exercise of any other rights or remedies that may
now or subsequently exist in law or in equity or by statute or otherwise. [Despite the previous sentence, the
mandatory price reduction mechanism stated in Section X is the Purchaser's exclusive remedy for any delivery that is
made no more than 30 calendar days after the Scheduled Delivery Date.]"
While the bracketed carve-out clearly states that the stipulated mandatory price reduction mechanism is the
exclusive remedy for any delivery that is no more than 30 calendar days late, the provision is silent (and therefore
ambiguous) about the purchaser's remedies if the delay continues beyond 30 days. Unless the parties intend in this
case for the purchaser to obtain the discounted goods, plus be able to pursue any and all other remedies, it is better
to state specifically what those remedies are, and then carve the exclusive remedy out of the cumulative remedies
provision.
For more on cumulative versus exclusive provisions, check out "Negotiating and Drafting Contract Boilerplate" (ALM
Publishing, 2002), edited by Tina L. Stark, Professor of the Practice of Law and the head of the new Transactional
Law Program at Boston University School of Law.
Lawrence Hsieh is a corporate attorney and an editor at the Practical Law Company in New York. Lawrence is
also the author of the "Corporate Transactions Handbook."
Reprinted with permission from the August 11, 2011 edition of the New York Law Journal © 2011 ALM Media
Properties, LLC. All rights reserved. Further duplication without permission is prohibited. For information, contact
877-257-3382, reprints@alm.com or visit www.almreprints.com.
 |  |  |  |
© 2008 Lawrence Hsieh
New York Law Journal - Archived Article - August 11, 2011
"Sandbagging Provisions; Cumulative vs. Exclusive Remedies"
"Sandbagging Provisions; Cumulative vs. Exclusive Remedies"
This website and other publications of Lawrence Hsieh contain practical and useful information on a wide variety of small business
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professional. Thank you.
contract matters. The information in this website or any publication of Lawrence Hsieh is not intended to constitute legal,
accounting or professional advice. If you require legal or other expert assistance, then you should seek the services of a licensed
professional. Thank you.
The Contract Adviser
Practical Common Sense Insight about
Contracts and Corporate Transactions
Contracts and Corporate Transactions
Special thanks to Glenn D. West, a corporate law partner at Weil Gotshal & Manges for his expert guidance.
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Note to readers: In each of my New York Law Journal columns, I will focus on two types of provisions - a “deal
point” provision and a “boilerplate” provision. Today, let’s focus on contract provisions dealing with
"sandbagging", which you may encounter in acquisition agreements, and cumulative and exclusive remedies
provisions, which are staples of boilerplate.
point” provision and a “boilerplate” provision. Today, let’s focus on contract provisions dealing with
"sandbagging", which you may encounter in acquisition agreements, and cumulative and exclusive remedies
provisions, which are staples of boilerplate.