Representations and Warranties of Prometheus. Prometheus represents and warrants to the Buyer and to Lennar as follows: (a) Prometheus is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware. (b) Prometheus has all power and authority necessary to enable it to enter into this Agreement and carry out the transactions contemplated by this Agreement. All actions necessary to authorize Prometheus to enter into this Agreement and carry out the transactions contemplated by it have been taken. This Agreement has been duly executed by Prometheus and is a valid and binding agreement of Prometheus, enforceable against Prometheus in accordance with its terms. (c) Except as set forth in Schedule 4.1-C to the Merger Agreement, neither the execution or delivery by Prometheus of this Agreement or of any document to be delivered in accordance with this Agreement nor the consummation by Prometheus of the transactions contemplated by this Agreement or by any document to be delivered in accordance with this Agreement will violate, result in a breach of, or constitute a default (or an event which, with notice or lapse of time or both would constitute a default) under, the Certificate of Formation or Limited Liability Company Agreement of Prometheus, any agreement or instrument to which Prometheus is a party or by which it is bound, any law, or any order, rule or regulation of any court or governmental agency or other regulatory organization having jurisdiction over Prometheus. Prometheus does not own any shares of stock of, or other equity interests in, any other entity, other than the stock of the Company being sold to the Buyer pursuant to this Agreement. (d) Prometheus is not the subject of any suit or governmental proceeding which seeks to prevent Prometheus from completing the transactions which are the subject of this Agreement, nor, to the best of Prometheus' knowledge, has any such suit or proceeding against Prometheus been threatened. (e) Prometheus owns 25,000 Preferred Shares, 224,712 Common Shares and 5,208,333 Warrants (the "Prometheus Securities"), free and clear of any liens or encumbrances (other than liens in favor of Capital Trust, Inc., which will be discharged at the Closing), and Prometheus has full authority to sell the Prometheus Securities as contemplated by this Agreement. Each Warrant entitles (or, when it becomes exercisable, will entitle) the holder to acquire one share of Common Stock for $0.04. Prometheus does not own, hold warrants to purchase, or otherwise have the right to acquire, any shares of stock of the Company of any class other than (x) the Prometheus Securities, (y) shares of Common Stock Prometheus has (or will have) the right to acquire upon exercise of Warrants included in the Prometheus Securities, and (z) Prometheus' right to acquire Preferred Shares and Warrants from Short upon foreclosure of security interests granted by Short to Prometheus (which will be discharged when Prometheus receives the payment required by Paragraph 2.3(d)). Prometheus has not granted any option or right, and is not a party to any other agreement (other than the agreements creating the liens in favor of Capital Trust, Inc. described in the first sentence of this subparagraph), which requires, or upon the passage of time, the payment of money, or the occurrence of any other event, may require, Prometheus to transfer any of the Prometheus
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Representations and Warranties of Prometheus. Prometheus represents and warrants to the Buyer and to Lennar as follows:
(a) Prometheus is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware.
(b) Prometheus has all power and authority necessary to enable it to enter into this Agreement and carry out the transactions contemplated by this Agreement. All actions necessary to authorize Prometheus to enter into this Agreement and carry out the transactions contemplated by it have been taken. This Agreement has been duly executed by Prometheus and is a valid and binding agreement of Prometheus, enforceable against Prometheus in accordance with its terms.
(c) Except as set forth in Schedule 4.1-C to the Merger Agreement, neither the execution or delivery by Prometheus of this Agreement or of any document to be delivered in accordance with this Agreement nor the consummation by Prometheus of the transactions contemplated by this Agreement or by any document to be delivered in accordance with this Agreement will violate, result in a breach of, or constitute a default (or an event which, with notice or lapse of time or both would constitute a default) under, the Certificate of Formation or Limited Liability Company Agreement of Prometheus, any agreement or instrument to which Prometheus is a party or by which it is bound, any law, or any order, rule or regulation of any court or governmental agency or other regulatory organization having jurisdiction over Prometheus. Prometheus does not own any shares of stock of, or other equity interests in, any other entity, other than the stock of the Company being sold to the Buyer pursuant to this Agreement.
(d) Prometheus is not the subject of any suit or governmental proceeding which seeks to prevent Prometheus from completing the transactions which are the subject of this Agreement, nor, to the best of Prometheus' knowledge, has any such suit or proceeding against Prometheus been threatened.
(e) Prometheus owns 25,000 Preferred Shares, 224,712 Common Shares and 5,208,333 Warrants (the "Prometheus Securities"), free and clear of any liens or encumbrances (other than liens in favor of Capital Trust, Inc., which will be discharged at the Closing), and Prometheus has full authority to sell the Prometheus Securities as contemplated by this Agreement. Each Warrant entitles (or, when it becomes exercisable, will entitle) the holder to acquire one share of Common Stock for $0.04. Prometheus does not own, hold warrants to purchase, or otherwise have the right to acquire, any shares of stock of the Company of any class other than (x) the Prometheus Securities, (y) shares of Common Stock Prometheus has (or will have) the right to acquire upon exercise of Warrants included in the Prometheus Securities, and (z) Prometheus' right to acquire Preferred Shares and Warrants from Short upon foreclosure of security interests granted by Short to Prometheus (which will be discharged when Prometheus receives the payment required by Paragraph 2.3(d)). Prometheus has not granted any option or right, and is not a party to any other agreement (other than the agreements creating the liens in favor of Capital Trust, Inc. described in the first sentence of this subparagraph), which requires, or upon the passage of time, the payment of money, or the occurrence of any other event, may require, Prometheus to transfer any of the Prometheus Securities to anyone other than the Buyer. When the Buyer acquires the Prometheus Securities as contemplated by this Agreement, the Buyer will become the owner of the Prometheus Securities, free and clear of any liens, encumbrances or claims of other persons, other than liens or encumbrances imposed by reason of acts of the Buyer.
(f) No governmental filings, authorizations, approvals or consents, or other governmental action are required to permit Prometheus to fulfill all its obligations under this Agreement.
(g) To the best of Prometheus' knowledge, each of the representations and warranties contained in Paragraph 4.1 of the Merger Agreement is true and correct in all material respects (except that each of those representations and warranties which is qualified as to materiality or as to absence of a Material Adverse Effect is true and correct in all respects). For the purposes of this subparagraph, Prometheus' "knowledge" of a fact or condition means actual awareness of that fact or condition by one or more of Andrew Zobler, Mark Ticotin or Michael Mahony.
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Sources: Securities Purchase Agreement (Lazard Freres Real Estate Investors LLC)