Every technology contract carries with it a degree of financial risk. For example, the customer may become insolvent and unable to pay the contract fees; the service provider may cease to carry on business; or either party may have insufficient funds to support an indemnity.
Some of the key contractual mechanisms used to address financial risks of this type include:
* bank guarantees
* performance guarantees
* insurance
* milestone payments
* liquidated damages
* limitation of liability provisions.
This article provides a brief overview of the principles underpinning these concepts.
See full Article.
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