EXHIBIT 1
AGREEMENT
This is an agreement dated June 10, 1997 between MFA Limited
Partnership, a Delaware limited partnership ("MFA"), LMM Family Partnership,
L.P. ("LMM"), Xxxxxxx Xxxxxx, an individual ("XXXXXX," and together with MFA
and LMM, the "XXXXXX ENTITIES"), Pacific Greystone Corporation, a Delaware
corporation ("GREYSTONE") and Warburg, Xxxxxx Investors, L.P. ("WARBURG").
Whereas, Lennar Corporation ("LENNAR") and Greystone propose to
enter into a Plan and Agreement of Merger on the date of this Agreement (as it
may be amended or supplemented, the "MERGER AGREEMENT") providing for the
merger of Lennar into Greystone (the "MERGER");
Whereas, the Xxxxxx Entities collectively own in the aggregate
9,944,130 shares of Class B Common Stock, par value $0.10 per share, of Lennar
(the "LENNAR CLASS B STOCK"); those shares of Lennar Class B Stock, as they may
be adjusted by any stock dividend, stock split, recapitalization, combination
or exchange of shares, merger, consolidation, reorganization or other change or
transaction of or by Lennar, are referred to in this Agreement as the "XXXXXX
SHARES";
Whereas, as a condition to its willingness to enter into the Merger
Agreement, Greystone has requested that the Xxxxxx Entities enter into this
Agreement;
Now, therefore, to induce Lennar to enter into, and in consideration
of its entering into, the Merger Agreement, and in consideration of the mutual
covenants and agreements set forth in this Agreement, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties to this Agreement agree as follows:
ARTICLE 1
REPRESENTATIONS AND WARRANTIES OF THE XXXXXX ENTITIES
1.1 MFA and LMM each represents and warrants as to itself to Greystone
and Warburg as follows:
(a) AUTHORITY. It is a limited partnership, duly organized validly
existing and in good standing under the laws of the State of Delaware. It has
all power and authority necessary to enable it to enter into this Agreement and
to carry out the transactions contemplated by this Agreement. This Agreement
has been duly and validly authorized, executed and delivered by it and
constitutes its legal, valid and binding obligation, enforceable against it in
accordance with its terms.
(b) NON-CONTRAVENTION. Neither its execution and delivery of this
Agreement nor consummation 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, its
limited partnership agreement, any agreement or instrument to which it 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 it.
(c) APPROVALS AND CONSENTS. No governmental filings,
authorizations, approvals or consents, or other governmental action is required
for the execution and delivery of this Agreement by it, the performance by it
of its obligations under this Agreement or the consummation by it of the
transactions contemplated by this Agreement.
1.2 Xxxxxx represents and warrants to Greystone and Warburg as follows:
(a) AUTHORITY. Xxxxxx has full capacity and authority to enter
into this Agreement and to carry out the transactions contemplated by this
Agreement. This Agreement has been duly executed and delivered by Xxxxxx and
constitutes a legal, valid and binding obligation of Xxxxxx enforceable against
Xxxxxx in accordance with its terms. The representations and warranties in
Section 1.1 are true and correct.
(b) APPROVALS AND CONSENTS. No governmental filings,
authorizations, approvals or consents, or other governmental action is
necessary or required for the execution and delivery of this Agreement by
Xxxxxx, the performance by Xxxxxx of its obligations under this Agreement or
the consummation of the transactions contemplated hereby.
1.3 Each of the Xxxxxx Entities represents and warrants to
Greystone that (a) the Xxxxxx Shares constitute more than 98% of the
outstanding shares of Lennar Class B Stock and have more than 50% of the voting
power of all the outstanding stock of Lennar of all classes; (b) the Xxxxxx
Entities own the Xxxxxx Shares, free and clear of any liens, claims, security
interests, proxies, voting trusts or agreements, understandings or arrangements
which would in any way restrict or impair the Xxxxxx Entities' right to vote
the Xxxxxx Shares in their sole discretion or could require the Xxxxxx Entities
to sell or transfer any of the Xxxxxx Shares (whether upon default on a loan or
otherwise) before December 31, 1997; (c) the Xxxxxx Entities have the sole
voting power and sole power to issue instructions with respect to the Xxxxxx
Shares and (d) the obligations of the Xxxxxx Entities hereunder shall survive
the death, disability or incapacity of Xxxxxx.
1.4 Greystone hereby represents and warrants to the Xxxxxx Entities
and Warburg as follows:
(a) AUTHORITY. Greystone is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware.
Greystone has all power and authority necessary to enable it to enter into this
Agreement and to carry out the transactions contemplated by this Agreement.
This Agreement has been duly and validly authorized, executed and delivered by
Greystone and constitutes a legal, valid and binding obligation of Greystone
enforceable against Greystone in accordance with its terms.
(b) NON-CONTRAVENTION. Neither the execution and delivery of
this Agreement by Greystone nor the consummation 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
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default (or an event which, with notice or lapse of time or both would
constitute a default) under, the certificate of incorporation or by-laws of
Greystone, any agreement or instrument to which Greystone 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
Greystone.
(c) APPROVALS AND CONSENTS. No governmental filings,
authorizations, approvals or consents, or other governmental action is required
for the execution and delivery of this Agreement by Greystone, the performance
by Greystone of its obligations under this Agreement or the consummation by
Greystone of the transactions contemplated by this Agreement.
ARTICLE 2
COVENANTS OF THE XXXXXX ENTITIES
Each of the Xxxxxx Entities hereby covenants and agrees as to itself with
Greystone and Warburg as follows:
2.1 VOTE FOR MERGER. At any meeting of stockholders of Lennar
called to vote upon the Merger and the Merger Agreement or any of the
transactions contemplated thereby (including the Spin Off, as defined in the
Merger Agreement) or at any adjournment or postponement thereof or in any other
circumstances upon which a vote, consent or other approval with respect to the
Merger and the Merger Agreement is sought, each Xxxxxx Entity shall vote (or
cause to be voted) all of the outstanding shares of Lennar Class B Stock owned
by it in favor of the Merger, the adoption by Lennar of the Merger Agreement,
other matters relating to the approval of the terms of the Merger Agreement and
each of the other transactions contemplated by the Merger Agreement (including
the Spin Off).
2.2 VOTE AGAINST ALTERNATIVE PROPOSALS. At any meeting of
stockholders of Lennar or at any adjournment or postponement thereof or in any
other circumstances upon which the Xxxxxx Entity's vote, consent or other
approval is sought, each Xxxxxx Entity shall vote (or cause to be voted) all of
the outstanding shares of Lennar Class B Stock owned by it against (i) any
proposal or offer with respect to any direct or indirect (A) acquisition or
purchase of what would be 15% or more of the outstanding common stock of
Lennar, (B) acquisition or purchase of any equity securities of any significant
subsidiary of Lennar (as the term "significant subsidiary is defined in
Securities and Exchange Commission Regulation S-X), (C) acquisition or purchase
of all or any significant portion of the assets of Lennar or any subsidiary of
Lennar, or (D) any merger, consolidation, business combination,
recapitalization, liquidation, dissolution or similar transaction involving
Lennar or any of its subsidiaries, (ii) any change in the persons who
constitute the Board of Directors of Lennar or (iii) any change in the present
capitalization of Lennar or any amendment of Lennar's certificate of
incorporation or by-laws or other proposal or transaction involving Lennar or
any of its subsidiaries, if in the case of clause (i), (ii) or (iii) such
transaction, change, amendment or other proposal or transaction would in any
manner impede, frustrate, prevent or nullify the Merger, the Merger Agreement
or any of the other transactions contemplated by the Merger Agreement
(including the Spin Off) or would reasonably be likely to result in any of the
conditions to Lennar's obligations under the Merger Agreement not being
fulfilled.
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2.3 TRANSFERS. Prior to the Effective Time (as defined in the
Merger Agreement), no Xxxxxx Entity will (i) sell, transfer, pledge, assign or
otherwise dispose of, or enter into any contract, option or other arrangement
with respect to the sale, transfer, pledge, assignment or other disposition of,
any Xxxxxx Shares to any person other than pursuant to the Merger and the
Merger Agreement, unless such transferee would be a "Permitted Transferee"
under Lennar's Certificate of Incorporation (a "PERMITTED TRANSFEREE") and
agrees in writing to be bound by the terms of this Agreement with respect to
the Xxxxxx Shares transferred to it or (ii) enter into any voting arrangement,
whether by proxy, voting arrangement, voting agreement or otherwise, other than
for the purpose of voting the Xxxxxx Shares as required by this Agreement.
2.4 NO SOLICITATIONS. Prior to the Effective Time (as defined in
the Merger Agreement), no Xxxxxx Entity nor any of its affiliates nor any of
their respective officers, partners or directors shall, and each Xxxxxx Entity
will direct, and use its best efforts to cause, its employees, agents and
representatives (including any investment banker, attorney or accountant
retained by it or any of its affiliates) not to, directly or indirectly,
initiate, solicit, encourage or otherwise facilitate any inquiries or the
making of any proposal or offer with respect to a merger, reorganization, share
exchange, consolidation or similar transaction involving Lennar, or any
purchase of, or tender offer for, all or any significant portion of any equity
securities of Lennar or of all or any significant portion of the assets of
Lennar on a consolidated basis (any such proposal or offer being hereinafter
referred to as an "ACQUISITION PROPOSAL"); provided however that nothing in
this Agreement shall prevent any person from taking any action permitted or
required pursuant to the Merger Agreement to be taken by such person in his
capacity as a director of Lennar and all such actions taken by any person who
is a director of Lennar shall be deemed to be taken by such person in his
capacity as a director. Each Xxxxxx Entity agrees that it will promptly advise
Greystone of the receipt of any Acquisition Proposal.
2.5 VOTE FOR WARBURG NOMINEES. For as long as Warburg is entitled,
pursuant to the Agreement dated as of the date hereof by and between Warburg,
Lennar and Greystone (the "WARBURG VOTING AGREEMENT"), to nominate one or more
persons ("WARBURG NOMINEES") to serve as directors on the Board of Directors of
the surviving corporation of the Merger (the "COMPANY"), at any meeting of
stockholders of the Company called to vote upon the election of a Warburg
Nominee to the Company's Board of Directors or a Warburg Nominee's removal
therefrom, or at any adjournment or postponement thereof or in any other
circumstances upon which such a vote, consent or other approval is sought, each
Xxxxxx Entity shall vote (or cause to be voted) all of the equity securities of
the Company owned by it in favor of the election of the Warburg nominees and
against their removal from the Board of Directors of the Company. Each Xxxxxx
Entity shall also vote (or cause to be voted) all of the equity securities of
the Company owned by it in favor of, consent to, and take any and all other
actions reasonably necessary to effect, the changes to the structure of the
Company's Board of Directors set forth in Paragraph 4.1 of the Warburg Voting
Agreement.
2.6 VOTE ON AMENDMENT. (a) Prior to the first to occur of the
second anniversary of the Merger or the effectiveness of the Amendment (as such
term is defined below), none of the Xxxxxx Entities will vote any equity
securities of the Company owned by them in favor of any merger, consolidation
or other business combination that, if the Amendment were effective, would
require the Minority Vote (as defined below).
(b) Each Xxxxxx Entity will vote all of its shares of common
stock or Class B Common Stock of the Company in favor of the Amendment.
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For purposes of this Agreement, "Amendment" means an amendment to
the Company's Certificate of Incorporation to provide that, in addition to any
other vote required by the certificate of incorporation, by law, by any rule of
any securities exchange or otherwise, any merger, consolidation or other
business combination involving the Company shall require the affirmative vote
of the holders of at least a majority of the issued and outstanding shares of
common stock (other than the Class B Common Stock of the Company) of the
Company (the "COMMON STOCK"), voting as a single class (the "MINORITY VOTE"),
unless the type and amount of the consideration received by the holder of a
share of Common Stock of the Company in such transaction is the same as that
received by a holder of, a share of Class B Common Stock of the Company;
provided, however that if shareholders are given the right to elect among
differing kinds of consideration in such business combination, the foregoing
requirement will be deemed satisfied if the holders of shares of Common Stock
are given the same rights of election (including without limitation proration
rights) as the holders of shares of Class B Common Stock of the Company.
2.7 RESTRICTION ON SALE. Each Xxxxxx Entity agrees that until
November 30, 1999, it shall not sell or otherwise dispose of any shares of
stock of the Company which the Xxxxxx Entity receives as a result of the Merger
with regard to Xxxxxx Shares unless (i) the transferee agrees to be bound by
the provisions of this Agreement or (ii) after the sale, the Xxxxxx Entities
hold in aggregate shares entitled to more than 50% of the votes in an election
of directors of the Company. Any sale or other disposition in violation of the
terms hereof shall be null and void.
ARTICLE 3
COVENANT OF COMPANY
3.1 VOTE ON AMENDMENT. No later than the first annual meeting of
shareholders of the Company following the Merger, the Company will recommend
the Amendment to its shareholders and shall take or cause to be taken all
reasonable actions within its respective power and authority to cause the
Amendment to be approved by its shareholders.
ARTICLE 4
TERMINATION
4.1 TERMINATION. The covenants and agreements contained in Article
II and Article III of this Agreement shall be of no further force or effect in
the event that at any time (i) the Warburg Voting Agreement shall not be
enforceable against the holders of shares of Common Stock of Greystone party
thereto or covered thereby, (ii) the Merger Agreement is terminated in
accordance with its terms or (iii) the Merger has occurred, the Xxxxxx Entities
no longer have any obligations under Paragraph 2.5 and the Xxxxxx Entities have
voted all of their shares of Common Stock in favor of the Amendment. The
covenants and agreements contained in this Agreement shall survive the Merger
and after the Merger shall be binding upon and inure to the benefit of the
Company.
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ARTICLE 5
GENERAL PROVISIONS
5.1 EXPENSES. All costs and expenses incurred in connection with
this Agreement and the transactions contemplated hereby shall be paid by the
party incurring the expense.
5.2 ENTIRE AGREEMENT. This Agreement, the Merger Agreement and the
documents to be delivered in accordance with this Agreement and the Merger
Agreement contain the entire agreement among the parties relating to the
transactions which are the subject of this Agreement and all prior
negotiations, understandings and agreements among the parties with regard to
the subject matter of this Agreement are superseded by this Agreement and the
Merger Agreement, and there are no representations, warranties, understandings
or agreements concerning the transactions which are the subject of this
Agreement or those other documents other than those expressly set forth in this
Agreement and the Merger Agreement.
5.3 CAPTIONS. The captions of the articles and paragraphs of this
Agreement are for reference only, and do not affect the meaning or
interpretation of this Agreement.
5.4 PROHIBITION AGAINST ASSIGNMENT. Neither this Agreement nor any
right or obligations of any party under it may be assigned (except that after
the Merger, this Agreement shall be binding upon and inure to the benefit of
the surviving corporation of the Merger).
5.5 NOTICES AND OTHER COMMUNICATIONS. Any notice or other
communication under this Agreement must be in writing and will be deemed given
when delivered in person or sent by facsimile (with proof of receipt at the
number to which it is required to be sent), or on the third business day after
the day on which mailed by first class mail from within the United States of
America, to the following addresses (or such other address as may be specified
after the date of this Agreement by the party to which the notice or
communication is sent):
If to Greystone:
Pacific Greystone Corporation
0000 Xxxxxx Xxxx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxx Xxxxxx
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxxxxxx, Esq.
Wachtell, Lipton, Xxxxx & Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: (000) 000-0000
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If to Warburg:
Warburg, Xxxxxx Investors, L.P.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxxxxx
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxxxxxx, Esq.
Wachtell, Lipton, Xxxxx & Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: (000) 000-0000
If to any Xxxxxx Entity:
Xxxxxxx Xxxxxx
000 Xxxxxxxxx 000xx Xxxxxx
Xxxxx, Xxxxxxx 00000
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxx X. Xxxxxxxxx, Esq.
Xxxxxx & Xxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: (000) 000-0000
5.6 GOVERNING LAW. This Agreement will be governed by, and
construed under, the substantive laws of the State of Delaware.
5.7 AMENDMENTS. This Agreement may be amended only by a document
in writing signed by Lennar, Warburg, Greystone and each Xxxxxx Entity, and no
amendment to Paragraph 2.6 or 3.1 shall be effective unless it has been
approved by both (i) the unanimous vote of the members of the Company's Board
who are not Xxxxxx Entities, relatives of any Xxxxxx Entity or affiliates of
the Xxxxxx Entities and (ii) the affirmative vote of the holders of at least a
majority of the then outstanding shares of Common Stock of the Company, and
those holders shall be deemed to be third party beneficiaries of the agreements
contained in Paragraph 2.6 and 3.1 solely for the purpose of enforcing those
agreements.
5.8 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, some of which may contain the signatures of some, but not all,
the parties. Each of those counterparts will be deemed an original, but all of
them together will constitute one and the same agreement.
5.9 SEVERABILITY. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under any present or future law, and if the
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rights or obligations of any party hereto under this Agreement will not be
materially and adversely affected thereby, (i) such provision will be fully
severable, (ii) this Agreement will be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part hereof,
(iii) the remaining provisions of this Agreement will remain in full force and
effect and will not be affected by the illegal, invalid or unenforceable
provision or by its severance herefrom and (iv) in lieu of such illegal,
invalid or unenforceable provision, there will be added automatically as a part
of this Agreement a legal, valid and enforceable provision as similar in terms
to such illegal, invalid or unenforceable provision as may be possible.
5.10 ENFORCEMENT. The parties agree that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached.
It is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in any Federal court located in the
State of Delaware or in a Delaware state court, this being in addition to any
other remedy to which they are entitled at law or in equity. In addition, each
of the parties hereto (i) consents to the personal jurisdiction of any Federal
court located in the State of Delaware or any Delaware state court in any
action or proceeding relating to or arising out of this Agreement or any of the
transactions contemplated hereby, (ii) agrees that such party will not attempt
to deny or defeat such personal jurisdiction by motion or other request for
leave from any such court, (iii) agrees that such parties will not seek to
change the venue of any such action or proceeding or otherwise to move any such
action or proceeding to another court, whether because of inconvenience of the
forum or otherwise (provided that nothing in this Section will prevent a party
from removing an action or proceeding from a Delaware state court to a Federal
Court located in the State of Delaware), (iv) agrees that such party will not
bring any action relating to this Agreement or any of the transactions
contemplated hereby in any court other than a Federal court sitting in the
State of Delaware or a Delaware state court and (v) waives any right to trial
by jury with respect to any claim or proceeding related to or arising out of
this Agreement or any of the transactions contemplated hereby.
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IN WITNESS WHEREOF, each party hereto has caused this Agreement to
be signed by its officer thereunto duly authorized as of the date in the first
paragraph of this Agreement.
PACIFIC GREYSTONE CORPORATION
By: /S/ XXXX XXXXXX
____________________________
Name: Xxxx Xxxxxx
Title: President
LMM FAMILY PARTNERSHIP, L.P.
By LMM Family Corp.,
its general partner
By: /S/ XXXXXXX XXXXXX
____________________________
Name: Xxxxxxx Xxxxxx
Title: President
MFA LIMITED PARTNERSHIP
By LMM Family Corp.,
its general partner
By: /S/ XXXXXXX XXXXXX
____________________________
Name: Xxxxxxx Xxxxxx
Title: President
Xxxxxxx Xxxxxx
/S/ XXXXXXX XXXXXX
____________________________
WARBURG, XXXXXX INVESTORS, L.P.
By Warburg, Xxxxxx & Co., its general
partner
By: /S/ XXXX X. XXXXXXXXX
____________________________
Name: Xxxx X. Xxxxxxxxx
Title: Partner
NB163895.4
