covenant,
representation
Page 36
or warranty contained in Section 5.1 or elsewhere, or otherwise, unless Buyer
has given Seller written notice of a specific indemnity claim or claim of
breach, stating in reasonable detail the factual basis for such claim, within
120 days after the Closing Date, and unless Buyer commences legal action on such
claim, and serves Seller with notice of such claim in accordance with applicable
Law, within 180 days after the Closing Date. Further, and notwithstanding
anything to the contrary herein, (i) Seller shall in no event be liable to Buyer
for any such claim unless and until the aggregate amount of Buyer's actual
out-of-pocket losses from all such valid claims exceeds $50,000, and (ii) in no
event shall the aggregate amount of Seller's liability exceed two percent of the
Purchase Price. The limitations in clauses (i) and (ii) of this Section 19.2 are
in addition to, and not in derogation of, the limitations in Section 5.4.3 with
respect to Seller's liability for breaches of its representations and
warranties. The limitations in this Section 19.2 shall not apply to the Seller's
liability under Sections 7.3, 11 and 12.
20. LIQUIDATED DAMAGES AND LIMITATIONS OF REMEDIES FOR BUYER'S BREACH. If Buyer
in breach of this Agreement fails to close, then upon written notice of
termination (a "Termination Notice") from Seller to Buyer and Escrow Agent, this
Agreement shall terminate (except for this section and Buyer's obligations
pursuant to Sections 4.6, 16.2 and 16.10). The parties acknowledge and agree by
initialing this Section 20 that:
20.1 IF BUYER FAILS TO CLOSE IN BREACH OF THIS AGREEMENT, SELLER WILL INCUR
CERTAIN COSTS AND OTHER DAMAGES IN AN AMOUNT THAT WOULD BE EXTREMELY DIFFICULT
OR IMPRACTICAL TO ASCERTAIN.
20.2 THE DEPOSIT, TOGETHER WITH ALL INTEREST EARNED THEREON, BEARS A REASONABLE
RELATIONSHIP TO THE DAMAGES WHICH THE PARTIES ESTIMATE MAY BE SUFFERED BY SELLER
BY REASON OF SUCH A FAILURE OF CLOSING TO OCCUR, AND THE DEPOSIT AND INTEREST IS
NOT AN AMOUNT WHICH IS UNREASONABLE UNDER THE CIRCUMSTANCES EXISTING AT THE TIME
THIS AGREEMENT IS MADE (BUYER ACKNOWLEDGING AND AGREEING THAT BUYER HAS FULLY
CONSIDERED THE PROVISIONS OF THIS SECTION 20 AND SUCH CIRCUMSTANCES PRIOR TO
ENTERING INTO THIS AGREEMENT AND HAS CONSULTED WITH BUYER'S COUNSEL WITH RESPECT
THERETO).
20.3 UPON DELIVERY TO ESCROW AGENT BY SELLER OF A PROPERLY GIVEN TERMINATION
NOTICE, SELLER SHALL BE ENTITLED TO RECEIVE AND RETAIN THE DEPOSIT, TOGETHER
WITH ALL INTEREST EARNED THEREON, AS LIQUIDATED DAMAGES, WHICH DAMAGES SHALL BE
SELLER'S SOLE REMEDY HEREUNDER IF BUYER IN BREACH OF THIS AGREEMENT FAILS TO
CLOSE, AND BUYER SHALL FORTHWITH INSTRUCT ESCROW AGENT TO RELEASE THE DEPOSIT
AND ALL INTEREST EARNED THEREON TO SELLER AND TO RETURN TO SELLER ALL DOCUMENTS
AND INSTRUMENTS THERETOFORE DEPOSITED INTO THE ESCROW BY OR ON BEHALF OF THEM;
PROVIDED, HOWEVER, THAT THE DEPOSIT SHALL BE IN ADDITION TO AND NOT IN LIEU OF
ANY AMOUNTS OWED TO SELLER BY BUYER AS A RESULT OF BUYER'S OBLIGATIONS PURSUANT
TO SECTIONS 4.6,