Common use of Admission of Transferee as Member Clause in Contracts

Admission of Transferee as Member. (a) The Managing Member may consent to a Transfer without consenting to the admission of the transferee under such approved Transfer (a “Transferee”) as a Member of the Company. A Transferee may only be admitted as a Member of the Company if and when (i) the Transferee becomes a party to this Agreement by agreeing in writing to be bound by the terms and provisions hereof, including the Capital Commitment of the transferring Member, and (ii) the Managing Member consents to such admission, which in its sole and absolute discretion may be withheld. Any Transferee shall execute and acknowledge such other instruments as the Managing Member may deem necessary or desirable to effectuate the admission of the Transferee as a Member of the Company. (b) Any Transferee not admitted as a Member of the Company shall be entitled to the Profits, Loss, and distributions allocable to the assigned Shares, but shall not be entitled to vote on Company matters or to exercise or enjoy any of the other rights of a Member of the Company unless and until such Transferee is admitted as a Member of the Company. Each Transferee or any subsequent Transferee of Interests, or any partial interests thereof, shall hold such Shares or Economic Interests subject to all of the provisions hereof and shall make no Transfers except as permitted hereby. (c) In the event a Member Transfers (or proposes to Transfer) all or any portion of its interest in the Company, the Managing Member may require that all reasonable legal and other out-of-pocket expenses incurred by the Company on account of the Transfer (or proposed Transfer) be paid by such Member, whether or not the Transfer is consummated; provided, however, that as of the effective date of any Transfer, the transferor and transferee shall be jointly and severally liable for all such expenses. At the Managing Member’s election, the Company may seek reimbursement of such expenses through (i) a direct reimbursement by the transferee or transferor either following the Transfer (or proposed effective date of the Transfer) or as of the Transfer as a condition precedent to the Managing Member providing such required consent, or (ii) withholding of distributions that otherwise would be made to the transferee or the transferor. The Managing Member may apply the amount of any such withheld distribution to satisfy all or any part of the transferor’s or the transferee’s obligation (in which case such amounts shall be deemed to have been distributed to such person and then paid by such person in full or partial satisfaction of such obligations). In the event that any such distribution consists of securities or other non-cash assets, the Managing Member may, on behalf of the transferor or the transferee, cause the Company to sell or otherwise liquidate such in-kind distribution upon such terms and conditions, and at such times, as the Managing Member deems appropriate, and apply the proceeds of such sale or other liquidation, net of transaction fees and other expenses, to satisfy all or any part of such person’s obligation that are then due. All items of Profit or Loss generated from the holding or disposition of any such withheld distribution shall be allocated solely to the Capital Account of the transferor or the transferee on whose behalf such amounts are held, and the corresponding items of net taxable income, gain, loss and deduction shall, to the maximum extent possible, also be allocated solely to such person. (d) Each Member hereby agrees and covenants that, with respect to such Member’s interest in the Company, it shall not make an election under Section 732(d) of the Code without the prior written consent of the Managing Member. Each Member hereby acknowledges and agrees that the Company may, but shall not be obligated to, elect to be treated as an electing investment partnership under Section 743(e) of the Code in the event the Company qualifies to do so. In such event, each transferring Member hereby agrees to provide the Company and its transferee with the timely notice required under Section 833 of the American Jobs Creation Act of 2004, and as more specifically described in IRS Notice 2005-32, or any successor guidance or interpretation(s), including such information as is necessary to enable such transferee to compute the amount of losses disallowed under Section 743(e) of the Code. Alternatively, in the event that the Company elects or is required to adjust the basis of the Company property under Section 743 of the Code, each Member hereby agrees to promptly provide to the Managing Member any information reasonably requested by the Managing Member in connection with such adjustment to the basis of Company property. In addition, to the extent that the Transfer to a Member (or the Transfer of interests in a Member) results in the Company adjusting the basis of Company property, each Member that received an interest in the Company by reason of such Transfer (or, in the case of the Transfer of interests in a Member, such Member) hereby agrees to reimburse the Company and/or the Managing Member within ten (10) business days for any expenses (including accounting fees) reasonably incurred by the Company and/or the Managing Member (and their respective Affiliates) from time to time in connection with effecting such adjustments to the basis of Company property and any corresponding adjustments to the calculation of Company gains and losses as they relate to such Transfer. The Managing Member is hereby authorized by each Member, with respect to any distribution to which such Member might otherwise be entitled, to defer making such distribution to such Member if, at the time such distribution would otherwise be effected, such Member has not satisfied its obligation to make the reimbursements provided for in the preceding sentence within the period specified therein. The Managing Member may further apply the amount of any such distribution to satisfy all or any part of such Member’s obligation (in which case such amounts shall be deemed to have been distributed to such Member and then paid by such Member in full or partial satisfaction of such obligations). In the event that any such distribution consists of securities or other non-cash assets, the Managing Member may, on behalf of such Member, cause the Company to sell or otherwise liquidate such in-kind distribution upon such terms and conditions, and at such times, as the Managing Member deems appropriate, and apply the proceeds of such sale or other liquidation, net of transaction fees and other expenses, to satisfy all or any part of such Member’s obligation that are then due. All items of Profit or Loss generated from the holding or disposition of any such deferred distribution shall be allocated solely to the Capital Account of the Member on whose behalf such amounts are held, and the corresponding items of net taxable income, gain, loss and deduction shall, to the maximum extent possible, also be allocated solely to such Member.

Admission of Transferee as Member. (a) The Managing A Transferee shall become a substituted Member may consent entitled to a Transfer without consenting to all the admission rights of the transferee under such approved Transfer (a “Transferee”) as a Member in respect of the Company. A Transferee may only be admitted as a Member of the Company Transferred Membership Interest if and when only if (i) the Transferring Member gives the Transferee becomes such right (which shall be presumed in the case of any voluntary Transfer unless the instrument of assignment expressly excludes such right), (ii) either (a) such admission is approved by the Board or (b) such Transfer is a party to this Agreement by agreeing Permitted Transfer, and (iii) the Transferee has agreed in writing to be bound by the terms and provisions hereof, including of this Agreement. If the Capital Commitment of the transferring Member, and (ii) the Managing Member consents to such admission, which in its sole and absolute discretion may be withheld. Any Transferee shall execute and acknowledge such other instruments as the Managing Member may deem necessary or desirable to effectuate the admission of the Transferee as a Member of the Company. (b) Any Transferee not admitted as a Member of the Company shall be entitled to the Profits, Loss, and distributions allocable to the assigned Shares, but shall not be entitled to vote on Company matters or to exercise or enjoy any of the other rights of a Member of the Company unless and until such Transferee is admitted as a Member pursuant to this Section 9.7(D), (I) the voting and other rights associated with the Membership Interest held by the Transferee shall be restored and transferred to the Transferee and be held by the Transferee in its capacity as substituted Member along with all other rights in respect of the Transferred Membership Interests and (II) this Agreement shall be amended to admit such Transferee as a Member and to reflect the elimination of the Transferring Member (or the reduction of such Membership Interest) and (if and to the extent then required by the Act) a certificate of amendment to the Certificate reflecting such admission and elimination (or reduction) shall be filed in accordance with the Act. The admission of any substitute Member pursuant to this ARTICLE IX shall be deemed effective on the effective date of such amendment to this Agreement. A Transferee that is not admitted as a Member pursuant to this Section 9.7(D) shall be entitled only to the share in the Distributions and other economic benefits in respect of the Transferred Membership Interests and shall have no other rights (including, without limitation, rights to approve matters that require the unanimous approval of all of the Members, or rights to any information or accounting of the affairs of the Company or to inspect the books or records of the Company) in respect of the Transferred Membership Interests. Each The Transferee or any subsequent shall have no liability as a Member solely as a result of the Transfer unless admitted as a Member pursuant to this Section 9.7(D); provided, however, the Transferee of Interests, or any partial interests thereof, shall hold such Shares or Economic Interests in all cases be subject to all of the provisions hereof and shall make no Transfers except as permitted hereby. (c) In the event a Member Transfers (or proposes to Transfer) all or any portion of its interest in the Company, the Managing Member may require that all reasonable legal Transfer restrictions and other out-of-pocket expenses incurred by the Company on account of the Transfer (or proposed Transfer) be paid by such Member, whether or not the Transfer is consummated; provided, however, that as of the effective date of any Transfer, the transferor and transferee shall be jointly and severally liable for all such expenses. At the Managing Member’s election, the Company may seek reimbursement of such expenses through (i) a direct reimbursement by the transferee or transferor either following the Transfer (or proposed effective date of the Transfer) or as of the Transfer as a condition precedent to the Managing Member providing such required consent, or (ii) withholding of distributions that otherwise would be made to the transferee or the transferor. The Managing Member may apply the amount of any such withheld distribution to satisfy all or any part of the transferor’s or the transferee’s obligation (in which case such amounts shall be deemed to have been distributed to such person and then paid by such person in full or partial satisfaction of such obligations). In the event that any such distribution consists of securities or other non-cash assets, the Managing Member may, on behalf of the transferor or the transferee, cause the Company to sell or otherwise liquidate such in-kind distribution upon such terms and conditions, and at such times, as the Managing Member deems appropriate, and apply the proceeds of such sale or other liquidation, net of transaction fees and other expenses, to satisfy all or any part of such person’s obligation that are then due. All items of Profit or Loss generated from the holding or disposition of any such withheld distribution shall be allocated solely to the Capital Account of the transferor or the transferee on whose behalf such amounts are held, and the corresponding items of net taxable income, gain, loss and deduction shall, to the maximum extent possible, also be allocated solely to such person. (d) Each Member hereby agrees and covenants that, with respect to such Member’s interest in the Company, it shall not make an election under Section 732(d) of the Code without the prior written consent of the Managing Member. Each Member hereby acknowledges and agrees that the Company may, but shall not be obligated to, elect to be treated as an electing investment partnership under Section 743(e) of the Code in the event the Company qualifies to do so. In such event, each transferring Member hereby agrees to provide the Company and its transferee with the timely notice required under Section 833 of the American Jobs Creation Act of 2004, and as more specifically described in IRS Notice 2005-32, or any successor guidance or interpretation(s), including such information as is necessary to enable such transferee to compute the amount of losses disallowed under Section 743(e) of the Code. Alternatively, in the event that the Company elects or is required to adjust the basis of the Company property under Section 743 of the Code, each Member hereby agrees to promptly provide to the Managing Member any information reasonably requested by the Managing Member in connection with such adjustment to the basis of Company property. In addition, to the extent that the Transfer obligations applicable to a Member (or under this ARTICLE IX. The Company shall be entitled to treat the Transfer record owner of interests in a Member) results in the Company adjusting the basis of Company property, each Member that received an any interest in the Company by reason as the absolute owner thereof and shall incur no liability for Distributions of cash or other property made in good faith to such owner until such time as a written assignment of such Transfer (orMembership Interest is permitted pursuant to the terms and conditions provided herein, in and such assignment has been received and approved by the case Board and has been recorded on the books of the Transfer of interests in a Member, such Member) hereby agrees to reimburse the Company and/or the Managing Member within ten (10) business days for any expenses (including accounting fees) reasonably incurred by the Company and/or the Managing Member (and their respective Affiliates) from time to time in connection with effecting such adjustments to the basis of Company property and any corresponding adjustments to the calculation of Company gains and losses as they relate to such Transfer. The Managing Member is hereby authorized by each Member, with respect to any distribution to which such Member might otherwise be entitled, to defer making such distribution to such Member if, at the time such distribution would otherwise be effected, such Member has not satisfied its obligation to make the reimbursements provided for in the preceding sentence within the period specified therein. The Managing Member may further apply the amount of any such distribution to satisfy all or any part of such Member’s obligation (in which case such amounts shall be deemed to have been distributed to such Member and then paid by such Member in full or partial satisfaction of such obligations). In the event that any such distribution consists of securities or other non-cash assets, the Managing Member may, on behalf of such Member, cause the Company to sell or otherwise liquidate such in-kind distribution upon such terms and conditions, and at such times, as the Managing Member deems appropriate, and apply the proceeds of such sale or other liquidation, net of transaction fees and other expenses, to satisfy all or any part of such Member’s obligation that are then due. All items of Profit or Loss generated from the holding or disposition of any such deferred distribution shall be allocated solely to the Capital Account of the Member on whose behalf such amounts are held, and the corresponding items of net taxable income, gain, loss and deduction shall, to the maximum extent possible, also be allocated solely to such MemberCompany.