Price cap clause: Copy, customize, and use instantly
Introduction
A price cap clause limits the maximum price that can be charged for goods or services under the agreement. It ensures that the buyer is protected from excessive price increases during the contract term, providing certainty and stability.
Below are templates for price cap clauses tailored to different scenarios. Copy, customize, and insert them into your agreement.
Standard price cap clause
This version sets a general price cap.
The unit price for the products or services provided under this Agreement shall not exceed [X] dollars per unit, and any price increases shall not exceed [Y]% per year without prior written approval from the [Customer].
Price cap clause with CPI-based adjustments
This version allows price increases based on the Consumer Price Index (CPI).
The price for goods or services under this Agreement may be adjusted annually, but the adjusted price shall not exceed a [X]% increase based on the Consumer Price Index (CPI) for the prior year, as published by [relevant authority].
Price cap clause with negotiated cap for long-term contracts
This version includes a negotiated price cap for long-term agreements.
The maximum price charged for products or services under this Agreement shall not exceed [X] dollars per unit for the first [Y] years, with any increase beyond that subject to mutual agreement.
Price cap clause with cap on service fees
This version applies to service fees.
The [Provider] agrees that the service fees associated with this Agreement shall not exceed [X] dollars per service, and any increase in service fees shall be capped at [Y]% per annum.
Price cap clause with inflation-based cap
This version ties the cap to inflation.
The price for all goods and services provided under this Agreement shall be capped at the original price for the first [X] years, with annual adjustments allowed based on the inflation rate, but no more than [Y]% per year.
Price cap clause with fixed percentage increase
This version allows for a fixed percentage increase.
The price for goods or services provided under this Agreement shall not exceed [X] dollars per unit, with any price increase limited to a fixed [Y]% annually, subject to market conditions.
Price cap clause with periodic price reviews
This version includes periodic price reviews.
The price for the products or services under this Agreement shall be capped at [X] dollars per unit, with the price reviewed every [Y] months and adjusted accordingly, but the cap shall not exceed [Z] dollars per unit.
Price cap clause with minimum order value consideration
This version adjusts the cap based on order size.
The maximum price per unit shall not exceed [X] dollars, unless the total order value exceeds [Y] dollars, in which case the unit price will be subject to renegotiation, with a cap of [Z] dollars.
Price cap clause with volume-dependent cap
This version ties the cap to order volume.
For orders exceeding [X] units, the price per unit will be capped at [Y] dollars, with any price adjustments for larger volumes requiring prior written approval from the [Customer].
Price cap clause with discount for volume but capped at a limit
This version includes a discount for volume with a cap.
The [Customer] shall receive a discount of [X]% for orders exceeding [Y] units, but the price per unit will not exceed [Z] dollars under any circumstances.
Price cap clause with cap for the first contract year
This version limits the price for the first contract year.
The price per unit for products or services shall not exceed [X] dollars during the first [Y] year of the contract. Any price adjustments after the first year shall be capped at [Z]% of the original price.
Price cap clause with inflation adjustment cap
This version adjusts based on inflation.
The price for the goods or services provided under this Agreement shall not exceed [X] dollars per unit, and any price increase due to inflation shall not exceed [Y]% of the original price for the duration of the Agreement.
Price cap clause with annual price increase cap
This version allows for annual price increases within a cap.
The price per unit for goods or services will be capped at [X] dollars, with any price increase allowed only once per year and limited to [Y]% of the previous year's price.
Price cap clause with specific product price cap
This version sets a cap for specific products.
The price for the product described in [Schedule X] shall not exceed [X] dollars per unit, even if there are changes in the cost of production or material costs.
Price cap clause with a cap on add-ons and additional fees
This version includes caps on additional fees.
The [Provider] agrees that the price for any add-ons, upgrades, or additional services under this Agreement shall not exceed [X] dollars per service or item, with no additional fees allowed unless approved by the [Customer].
Price cap clause with cap for initial period
This version sets a price cap for the initial contract period.
During the first [X] months of the Agreement, the price per unit shall be capped at [Y] dollars. After the initial period, the price may be adjusted but will not exceed [Z] dollars per unit.
Price cap clause with maximum annual increase cap
This version includes a cap on annual price increases.
The price for products or services provided under this Agreement will be capped at the agreed price, with any annual price increase not exceeding [X] dollars or [Y]% of the previous year's price.
Price cap clause with special pricing for new products
This version includes a cap for new products.
The price for any new products introduced under this Agreement will not exceed [X] dollars per unit, and any price increases for such products will be capped at [Y]% annually.
Price cap clause with price review and approval requirement
This version includes a review and approval requirement.
Any price increase proposed by the [Provider] for products or services exceeding [X] dollars per unit must be submitted to the [Customer] for approval. The price increase shall not exceed [Y]% of the previous price.
Price cap clause with currency fluctuation adjustment cap
This version allows adjustments for currency fluctuations.
The price per unit shall be capped at [X] dollars, with price increases allowed only to reflect currency fluctuations, but such increases will not exceed [Y]% of the original price during the term of the Agreement.
Price cap clause with cap on service contract increases
This version applies to service contracts.
The price for services under this Agreement will be capped at [X] dollars per service, and any increase in the service price will be limited to [Y]% of the previous year's price, subject to approval.
Price cap clause with cap for renewal term
This version sets a price cap for the renewal term.
Upon renewal of the Agreement, the price per unit for all products or services will be capped at [X] dollars, with any price increases not exceeding [Y]% of the original price for the renewal term.
Price cap clause with negotiated cap for large orders
This version applies to large orders.
The price per unit for any order exceeding [X] units will be capped at [Y] dollars, with any additional pricing adjustments subject to mutual negotiation between the parties.
Price cap clause with cap on optional services
This version caps optional services pricing.
Any optional services requested by the [Customer] will not exceed [X] dollars per service, and any increase in service fees will be capped at [Y]% per year.
Price cap clause with maximum overall project cost
This version includes a maximum overall project cost.
The total cost of the project, including all goods and services provided, shall not exceed [X] dollars, with any cost increases beyond this cap requiring written approval from the [Customer].
Price cap clause with cap for subscription-based services
This version applies to subscription-based services.
The price for subscription-based services will be capped at [X] dollars per month, with any price increases subject to approval and capped at [Y]% per year.
Price cap clause with fixed price for first term
This version sets a fixed price for the first term.
The price for all goods and services provided under this Agreement shall be fixed at [X] dollars per unit for the first [Y] months, with any increase subject to a maximum of [Z]% of the initial price after the first term.
Price cap clause with quarterly pricing reviews
This version includes quarterly pricing reviews.
The price for products or services will be capped at [X] dollars per unit, with a quarterly review of market conditions. However, any price increases will not exceed [Y]% of the previous quarter’s price.
Price cap clause with additional charges subject to cap
This version includes a cap for additional charges.
Any additional charges for customization, shipping, or other services provided under this Agreement shall not exceed [X] dollars, and any price increases for these charges shall be capped at [Y]% per year.
Price cap clause with limit on third-party price increases
This version applies to third-party price increases.
If third-party suppliers raise their prices, the price for goods under this Agreement will be adjusted accordingly, but the increase shall not exceed [X] dollars or [Y]% of the agreed price.
Price cap clause with industry standard-based adjustments
This version adjusts prices based on industry standards.
The price for goods or services will be capped at [X] dollars per unit, with price increases allowed based on changes to industry standards or costs, but such increases will not exceed [Y]% annually.
Price cap clause with product-specific price caps
This version sets price caps for specific products.
The price for each product listed in [Schedule X] shall be capped at [X] dollars per unit, and any price increases for these specific products shall not exceed [Y]% per year.
Price cap clause with agreement to adjust only once per year
This version allows price adjustments once per year.
The price for all products and services will be capped at [X] dollars per unit for the first year, with price adjustments allowed once per year, but not exceeding [Y]% of the previous price.
Price cap clause with cap for service renewals
This version includes a cap for service renewals.
The renewal price for services provided under this Agreement will not exceed [X] dollars per service, with any price increase not to exceed [Y]% at the time of renewal.
Price cap clause with maximum adjustment based on cost of living
This version ties adjustments to the cost of living.
The price for products or services under this Agreement shall be capped at [X] dollars per unit, with price increases allowed based on the cost of living index, but any increase shall not exceed [Y]% annually.
Price cap clause with annual adjustment based on supplier price hikes
This version adjusts prices based on supplier price hikes.
If the supplier's price increases by more than [X]%, the price for the goods provided under this Agreement may be adjusted. However, any increase shall not exceed [Y]% annually.
Price cap clause with a fixed percentage increase at contract renewal
This version allows a fixed percentage increase at renewal.
Upon renewal, the price for products or services provided under this Agreement shall be increased by no more than [X]%, subject to the mutual agreement of both parties.
Price cap clause with cap based on government tax rates
This version adjusts prices based on tax rates.
The price for the goods and services provided under this Agreement shall not exceed [X] dollars per unit, with adjustments made based on changes to applicable government tax rates, but no increase shall exceed [Y]%.
Price cap clause with ceiling on cost-plus pricing model
This version applies to a cost-plus model.
The price under this Agreement will be calculated on a cost-plus basis, but the cost shall not exceed [X] dollars per unit, with a cap of [Y]% on the markup over the base cost.
Price cap clause with cap for replacement parts pricing
This version applies to replacement parts.
The price for any replacement parts or accessories provided under this Agreement shall not exceed [X] dollars per unit, regardless of increases in production or material costs.
Price cap clause with price adjustment based on labor costs
This version adjusts based on labor costs.
The price for the goods or services provided under this Agreement shall be capped at [X] dollars per unit, with adjustments allowed based on changes in labor costs, but not exceeding [Y]% annually.
Price cap clause with no price increase during initial contract term
This version freezes prices during the initial term.
The price for products or services shall remain fixed at [X] dollars per unit for the first [Y] months of the contract, with no price increases allowed during this period.
Price cap clause with minimum price for high-cost products
This version sets a minimum price for certain products.
The price for certain high-cost products shall not fall below [X] dollars per unit, and any adjustments to this price will be made in writing and shall not exceed [Y]% of the previous price.
Price cap clause with periodic review based on market trends
This version allows for periodic reviews based on market trends.
The price for products or services shall be capped at [X] dollars per unit, with the price being reviewed quarterly based on market trends, but no price increase shall exceed [Y]% of the original price.
Price cap clause with flexible pricing for international shipments
This version includes flexibility for international shipments.
The price for international shipments may vary based on delivery location and logistics, but the price shall not exceed [X] dollars per unit, even if there are changes in international shipping fees.
Price cap clause with discount for bulk purchases
This version includes a discount for bulk purchases.
The unit price for bulk orders exceeding [Y] units will be capped at [X] dollars per unit, with a discount applied for orders exceeding this quantity.
Price cap clause with discount tied to early commitment
This version offers a discount for early commitment.
The price for any goods or services will be capped at [X] dollars per unit for the first [Y] orders placed within [Z] months, with a [W]% discount applied for orders placed before the end of [specified period].
Price cap clause with approval requirement for price increases
This version requires approval for price increases.
Any proposed price increase must be submitted to the [Customer] for approval. The price for any goods or services shall not exceed [X] dollars per unit unless approved by the [Customer].
Price cap clause with overall project cost cap
This version includes a cap for total project cost.
The total cost of the project shall not exceed [X] dollars, and any price adjustments will be capped at [Y]% of the original cost, subject to prior approval by the [Customer].
Price cap clause with service-specific caps
This version applies specific caps to different services.
The price for services provided under this Agreement shall be capped at [X] dollars per service, with any increase in service fees capped at [Y]% annually.
Price cap clause with percentage-based price increases
This version allows percentage-based increases.
The price for the goods or services shall not exceed [X] dollars per unit, with any price increases allowed based on a fixed percentage of [Y]% per year.
Price cap clause with escalation clause tied to market price indices
This version includes an escalation clause.
The price for goods or services provided under this Agreement will be adjusted annually based on the relevant market price index, with price increases capped at [X] dollars per unit.
Price cap clause with early termination pricing guarantee
This version guarantees pricing if the contract is terminated early.
If this Agreement is terminated early by the [Customer], the price for any remaining orders will be capped at the price set at the time of the initial order, without any additional price increases.
Price cap clause with pricing flexibility for exclusive products
This version applies to exclusive products.
The price for exclusive products may vary due to supply chain constraints, but will not exceed [X] dollars per unit, with any increases subject to negotiation.
Price cap clause with no increase on pre-negotiated rates
This version sets a cap on pre-negotiated rates.
The pre-negotiated rate for all goods and services will remain fixed throughout the term of this Agreement, with no price increase allowed unless mutually agreed by both parties.
Price cap clause with fixed pricing for service bundles
This version caps pricing for service bundles.
The price for any bundled services will be capped at [X] dollars per bundle, with the price increase for bundled services limited to [Y]% annually.
Price cap clause with ceiling on delivery-related fees
This version caps delivery-related fees.
The delivery fees for any goods ordered under this Agreement will be capped at [X] dollars, and any increase in shipping or handling fees must be approved by the [Customer].
Price cap clause with floor price for specific product categories
This version sets a floor price for certain products.
The price for products in the [specific product category] shall not fall below [X] dollars per unit, even if production costs decrease, unless mutually agreed upon by both parties.
Price cap clause with seasonal price freeze
This version includes a price freeze for specific seasons.
The price for any goods or services provided during the [specified season] will be capped at [X] dollars per unit, with no increases allowed during that period.
Price cap clause with conditional cap for cost increases
This version allows for price increases under specific conditions.
The price for products or services under this Agreement may increase in the event of unforeseen circumstances such as regulatory changes or supply shortages, but any increase shall not exceed [X]% without prior approval.
Price cap clause with flexible cap based on specific product performance
This version adjusts the cap based on product performance.
If the [Product] meets the performance criteria set in [Schedule X], the price will be capped at [X] dollars per unit. However, if the performance criteria are not met, the price will be capped at [Y] dollars per unit.
Price cap clause with adjustment tied to supplier contracts
This version adjusts based on supplier contracts.
The price for goods will be capped at [X] dollars per unit, with any adjustments in price being based on changes in the [Supplier’s] cost structure, but the price increase will not exceed [Y]% per year.
Price cap clause with approval for any increases beyond agreed limits
This version allows price increases with approval.
Any price increase beyond the agreed price of [X] dollars per unit must be approved in writing by the [Customer]. Any increase will be capped at [Y]% annually.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.