Seller's limitation of scope of indemnities

Typically, the scope of an indemnity may be limited in the following ways:

1. •

   by limiting the types of liabilities for which indemnification is to be provided—eg an indemnity can be limited to liabilities incurred:

   1. ◦

      directly from a given set of circumstances and not extend to liabilities incurred indirectly from, or merely in connection with, those circumstances, and/or

   2. ◦

      before completion of the business sale—for more information in relation to this, see Continuing breaches, below

2. •

   by limiting the time period over which the indemnity is to be provided

3. •

   by restricting the amount that can be claimed under the indemnity (known as an indemnity cap)

4. •

   by setting out requirements that the indemnified party must satisfy