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Legal Disclaimer of Representations

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LEGAL DISCLAIMER OF REPRESENTATIONS

This Legal Disclaimer of Representations ("Disclaimer") is made effective as of Effective Date: by and between Disclosing Party: , an entity organized as Other: , having its principal address at ; and Receiving Party: , an entity organized as Other: , having its principal address at

RECITALS

WHEREAS, Disclosing Party has provided or may provide information, statements, documents, negotiations, presentations, or other communications, whether oral or written, to Receiving Party in connection with discussions, due diligence, or contemplated transactions (collectively, "Communications"); and

WHEREAS, the Parties desire to set forth the extent to which Disclosing Party disclaims representations and the extent to which Receiving Party acknowledges and accepts responsibility for its own investigations and reliance.

NOW THEREFORE, in consideration of the mutual covenants set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

1. DEFINITIONS

For purposes of this Disclaimer, the following terms shall have the meanings set forth below. "Communications" means all communications described in the Recitals. "Representations" means any statement, fact, projection, estimate, forecast, warranty, covenant, assurance or assertion, whether express or implied, oral or written, made by or on behalf of Disclosing Party concerning matters of fact, law, condition, quality, fitness, suitability, performance, or future events.

2. DISCLAIMER OF REPRESENTATIONS

Except for representations and warranties expressly reduced to a written instrument and signed by an authorized representative of Disclosing Party, Disclosing Party makes no representations or warranties of any kind, express or implied, statutory or otherwise, with respect to the Communications. Without limiting the foregoing, Disclosing Party expressly disclaims any representations or warranties as to accuracy, completeness, merchantability, fitness for a particular purpose, title, non-infringement, or the absence of latent or patent defects.

3. NO RELIANCE; DUE DILIGENCE

Receiving Party acknowledges and agrees that: (a) it has been provided the opportunity to conduct its own independent investigation, inquiry and analysis with respect to the subject matter of the Communications; (b) it has not relied and will not rely upon any representation, warranty, projection, forecast, opinion or statement made by Disclosing Party, its agents, employees or advisors except as expressly set forth in a separate, written agreement signed by Disclosing Party; and (c) any decision by Receiving Party to proceed with any transaction or course of action shall be based solely on Receiving Party's own evaluation and judgment.

4. SPECIFIC DISCLAIMERS

Without limiting the generality of Section 2, Disclosing Party disclaims all liability for any statements contained in the Communications concerning:

Receiving Party acknowledges that the foregoing disclaimer includes, without limitation, any forward-looking statements, projections or estimates and any information regarding prospective financial performance, cost savings, market demand, regulatory outcome, or other events dependent on future occurrences.

5. INDEMNIFICATION

To the fullest extent permitted by law, Receiving Party shall indemnify, defend and hold harmless Disclosing Party and its affiliates, officers, directors, employees and agents (collectively, the "Indemnified Parties") from and against any and all claims, liabilities, losses, damages, costs and expenses (including reasonable attorneys' fees) arising out of or resulting from (a) Receiving Party's reliance on any Communications or (b) any breach by Receiving Party of this Disclaimer. This indemnity shall not apply to the extent such losses are finally adjudicated to have resulted solely from Disclosing Party's fraud or willful misconduct.

6. LIMITATION OF REMEDIES

EXCEPT TO THE EXTENT CAUSED BY FRAUD OR WILLFUL MISCONDUCT, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL, EXEMPLARY OR PUNITIVE DAMAGES, INCLUDING LOSS OF PROFITS, REVENUE OR BUSINESS OPPORTUNITY, ARISING OUT OF OR RELATED TO THE COMMUNICATIONS OR THIS DISCLAIMER, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

7. SURVIVAL

The provisions of this Disclaimer that by their nature are intended to survive termination or expiration of any discussions or other agreements between the Parties, including Sections 2, 3, 4, 5, 6, 8 and 9, shall survive any such termination or expiration.

8. NOTICES

All notices under this Disclaimer shall be in writing and delivered to the addresses set forth below (or to such other address as a Party designates by notice in accordance herewith). Notice shall be deemed given when delivered by hand, when transmitted by confirmed electronic transmission, one business day after deposit with an overnight courier, or three business days after deposit in the U.S. mail, postage prepaid, as applicable.

9. GENERAL PROVISIONS

Governing Law: This Disclaimer shall be governed by and construed in accordance with the laws of the jurisdiction specified by Receiving Party's principal address without regard to conflict of law principles. The Parties submit to the exclusive jurisdiction of the state and federal courts located in that jurisdiction for resolution of disputes arising under this Disclaimer.

Entire Agreement: This Disclaimer constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations and discussions, whether oral or written, between the Parties.

Severability: If any provision of this Disclaimer is held to be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions shall not be affected or impaired.

Amendments and Waiver: Any amendment or modification of this Disclaimer must be in writing and executed by duly authorized representatives of both Parties. No waiver of any provision shall be effective unless in writing and signed by the Party against whom enforcement is sought.

Counterparts: This Disclaimer may be executed in counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. Signatures transmitted by facsimile or electronic image shall be binding for all purposes.

EXECUTION

The Parties have executed this Legal Disclaimer of Representations as of the Effective Date first set forth above.

Disclosing Party:

Party Label:

By:

Date:

Receiving Party:

Party Label:

By:

Date:

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What a Legal Disclaimer of Representations Is and When It Applies

A Legal Disclaimer of Representations is a contractual clause that limits or removes reliance on certain factual statements or warranties made by a party. It clarifies which statements the parties accept as binding and which statements are disclaimed, helping allocate risk at contract formation. Commonly used in purchase agreements, service contracts, and disclosure schedules, the disclaimer can affect remedies, indemnity exposure, and the available grounds for rescission. Draft and execute this clause carefully: unclear or inconsistent disclaimers may be found unenforceable by a court or regulator.

Why Include a Legal Disclaimer of Representations

A clear disclaimer reduces ambiguity about which factual statements create contractual obligations, limits unintended warranties, and focuses negotiations on material issues rather than peripheral statements. Properly drafted, it helps manage litigation and indemnity exposure while preserving core representations the parties intend to rely on.

Why Include a Legal Disclaimer of Representations

Who Typically Drafts or Signs This Clause

Choose the appropriate drafter and reviewer based on transaction complexity—legal counsel for high-value deals, experienced contracts professionals for recurring commercial agreements.

  • Buyers and acquirers seeking to narrow seller warranties and limit post-closing claims.
  • Sellers and providers aiming to cap liability by disclaiming non-material statements or forward-looking projections.
  • In-house counsel and outside attorneys preparing contracts that balance disclosure with risk allocation.

Step-by-Step: How to Complete a Legal Disclaimer of Representations

Follow these steps to draft, review, and execute a clear disclaimer tailored to the transaction.

  • 01
    Draft scope: Identify statements and topics to disclaim precisely.
  • 02
    List exceptions: Specify any representations that remain binding.
  • 03
    Legal review: Have counsel review for enforceability and conflicts.
  • 04
    Execute and retain: Sign, date, and store the executed document in records.

How to Configure an Online Disclaimer Workflow

Set up your eSignature workflow to capture the disclaimer, exceptions, and signatures in order and with auditability.

Field Configuration
Party Name Field Required text field, validated for character length
Scope Description Multi-line field, optional templates available
Exceptions Checklist Conditional checkboxes that show preserved reps
Signature Field Signer-specific, enforces date and printed name

Digital Signing and eSubmission Considerations

Choose settings that preserve attribution, consent, and record retention consistent with ESIGN and UETA rules.

  • Formats: PDF and DOCX supported
  • Authentication: Email, SMS, or stronger options
  • Audit Trail: IP, time, and action log

Where to Send or File the Executed Disclaimer

Establish a routing plan so each party and relevant internal function receives an executed copy and the official record is retained.

  • Primary Recipient: Counterparty legal or contracts team
  • Internal Records: Contract repository or ECM system
  • Finance/Operations: If tied to payments or delivery
  • Regulatory Filing: Only when required by statute

Consequences of an Incorrect or Unclear Disclaimer

Contract Rescission: Ambiguous disclaimers can lead to rescission or reformation
Damage Exposure: Unclear scope may increase indemnity or tort damages
Regulatory Risk: Misstatements in regulated disclosures may trigger enforcement
Tax Penalties: Related misreporting can invoke IRC §6721 penalties
Notarization Defect: Missing acknowledgements can void recorded instruments
Enforceability Loss: Courts may disregard overly broad disclaimers

Common Mistakes to Avoid When Preparing a Disclaimer

  • Using vague language such as 'to the best of knowledge' without defining knowledge scope, which creates interpretive disputes and undermines certainty.
  • Failing to list exceptions explicitly, producing conflict with separately negotiated warranties or schedules and leading to litigation over intent.
  • Overreaching disclaimers that try to disclaim fraud or wilful misconduct; courts and some statutes will not enforce such broad limitations.
  • Neglecting signature authority checks: unsigned or incorrectly signed disclaimers may not bind the party and can void protections.

Practical Tips for a Clear and Enforceable Disclaimer

Adopt plain, specific language, document any negotiated exceptions, and preserve an auditable record of execution and consent.

Be precise about scope
Define the exact topics and statements being disclaimed rather than using broad or adjectival language; precision reduces litigation risk and improves enforceability.
Document preserved reps
Explicitly list representations that remain binding and cross-reference related schedules so parties cannot later claim ambiguity about preserved warranties.
Verify signatory authority
Confirm each signer’s title and authorization in the signature block or via corporate resolutions to avoid challenges to the agreement’s validity.
Retain the audit trail
Keep the signed PDF, audit logs, and any consent disclosures showing intent and access capability to satisfy ESIGN/UETA legal requirements.

Real-World Examples of Disclaimers Used in Transactions

These short case summaries illustrate how organizations used a disclaimer to manage risk in everyday transactions.

Optica Ventures LLC

The team standardized a disclaimer for repeat purchase agreements to limit reliance on pre-contract statements about future performance.

  • The interface supported mobile signing by external parties.
  • The outcome reduced negotiation time and clarified post-closing remedies while preserving key seller warranties that were expressly listed.

Xerox (NetSuite Operations)

Xerox used a tailored disclaimer clause in software delivery contracts to separate operational statements from binding commitments.

  • Integration with contract systems enforced exceptions.
  • This approach allowed the company to limit exposure for non-material statements while maintaining enforceable service-level and acceptance criteria in schedules.

eSignature Pricing and Feature Comparison for Executing Disclaimers

Compare common vendor price points and core capabilities relevant to secure, auditable execution of disclaimer clauses; signNow is listed first for parity.

signNow DocuSign Adobe Sign PandaDoc HelloSign
Starting Price $8/user/mo $15/user/mo $14/user/mo $19/user/mo $15/user/mo
Free Trial 7-day free trial, no credit card Varies by plan Varies by plan Varies by plan Varies by plan
Bulk Send Yes Yes Yes Yes No
Audit Trail Yes Yes Yes Yes Yes
HIPAA Compliant Yes Yes Yes No No
Envelope Cap No cap 100 envelopes/user/year Varies by plan Varies by plan Varies by plan

Key Timing Considerations When Finalizing a Disclaimer

Track these practical timing checkpoints to reduce execution delay and preserve rights tied to the disclaimer.

Effective Date Entry:

Enter an explicit MM/DD/YYYY effective date before signing to avoid disputes about timing

Negotiation Window:

Common commercial practice: allow 14–30 days for review and exception negotiation

Record Retention Start:

Begin retention from the effective date or execution date, as specified

Regulatory Filings:

File or record within statutory windows if the instrument must be recorded

Post-Execution Objections:

Specify any short objection period (e.g., 30 days) for identified errors or omissions

Security and Compliance Details to Preserve Legal Effect

In-Transit Encryption: TLS 1.2/1.3
At-Rest Encryption: AES-256
Audit Standards: SOC 2 Type II available
HIPAA Support: Compliant with BAA required
ESIGN / UETA: Meets ESIGN and UETA criteria
21 CFR Part 11: Available for regulated workflows

Frequently Asked Questions About Legal Disclaimers of Representations

Answers to common legal and execution questions about disclaimers, signature validity, and recordkeeping.


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