Representations and Warranties
A statement of fact in an agreement. One party confirms to the other party that those statements are true as of a particular date. If something is not true, the party giving the Representations and Warranties can give disclosures against them (usually in a separate document called a “disclosure letter”) or may be liable for failing to disclose.
Right of First Offer
ROFO. An asset owner has a contractual obligation to another party (the right holder) to offer that asset to the right holder before offering it for sale to a third party. The asset owner may sell the asset if no agreement is reached with the right holder but the contract may provide that the sale terms must be no more favourable than those offered to the right holder.
Right of First Refusal
ROFR. An asset owner has a contractual obligation to another party (the right holder) to offer that asset to the right holder after receiving a bona fide offer from a third party to buy that asset. VCs typically require a ROFR, giving them the right to purchase Shares, but do not usually agree to have their Shares subject to a ROFR.