Reps & Warranties (R&W)

Reps & warranties are the representations and warranties that the seller gives in the company purchase agreement regarding the condition, characteristics and risks of the company. They form the basis for any damages claims by the buyer after closing and are regularly qualified by a disclosure letter.

Scope, liability limitations (caps, baskets, de minimis), limitation periods and indemnities are central negotiating points. Increasingly, R&W are flanked by, or largely replaced with, W&I insurance.