Reps & Warranties
A representation cannot also be a warranty
False
A covenant is a type of _______.
Promise
Where should the names of the parties be defined? In the (A) recitals or (B) preamble?
Preamble
What is the legal name of NuMilk?
Plant Tap, Inc., a DE corporation
Term sheets are always binding on the parties.
False. More of a MOU, with the exception as to confidentiality provisions.
What is a date-down representation?
A re-certification of a representation previously made
The substance of the covenants are often part of the term sheet.
True (because they relate to subject matter performance)
It is not necessary to capitalize all defined terms used in the contract - this is a matter of style, not substance.
False.
How do I find the state of incorporation/formation for an entity?
SOS website
Why are redlines important in the drafting process?
easier to review own work, easier to understand how form has been adjusted for precedent deals etc.
What can you do to narrow this rep? "The Company hereby represents and warrants that there is no litigation pending against the Company."
add qualifer (knowledge, reasonableness, materiality) etc.
A party only has a right to terminate the contract if it is expressly provided in the contract itself.
You are trying to find the definition for the term "Bankruptcy" that is industry-approved. What do you do?
Practical Law, look for similar agreement in industry
If a person is signing a contract in his/her individual capacity, the signature line does not need to include "By:".
True. No agency.
You are asked to draft an employment agreement. Identify 3 questions you should ask your supervising attorney before starting.
e.g. when is it due? What form should I use? Do you have a term sheet?
E.g. pursue warranty (i.e. indemnity), if default trigger, may terminate, sue for misrepresentation etc
Does the lender have a unilateral or conditional right in the following? "It shall be an Event of Default entitling the Lender to all rights and remedies described herein following Borrower's failure to pay principal and interest in accordance with the schedule attached hereto"
Conditional
Giving the counterparty additional discretion is always harmful to your client.
False. Recall, when we build in discretion to enable the counterparty to negotiate a workaround following a default, this actually helps our client.
What documentation should you review to confirm the party signing on behalf of an entity is authorized to do so?
Org docs, officer's cert., resolution etc.
What are Practice Notes and how are they helpful in practice?
Brief overview of topic, primer
What is the purpose of an officer's certificate?
Not necessary. Consideration can be satisfied in the form of promise not to exercise a right.
Declarations used in the recitals must be redefined in the body of the contract.
False. You can expressly incorporate by reference.
"domestic" versus "foreign" designations
What is the difference between "effective as of" and "dated as of" when used in a contract?
dated - assumption is date signed and effective date are the same. effective as of - usually effective is a later date after date contract was signed.