Due Diligence & Legal
Indemnification Basket & Cap
Thresholds limiting a seller's indemnity exposure — a low cap and high basket materially protect the promoter's post-sale liability and personal balance sheet.
Seller Example
Promoter selling a Noida IT staffing company for ₹25 Cr negotiates the general indemnity cap down from the buyer's proposed 50% of price to 20% (₹5 Cr), with a ₹25 Lakh basket, and shortens the cap sunset to 12 months instead of 24 — minimizing the window of contingent liability hanging over the promoter post-exit.