General Restrictions on Transfer. (a) Each Member acknowledges and agrees that, until the consummation of a Qualified Public Offering, such Member (or any Permitted Transferee of such Member) shall not Transfer any Units or Unit Equivalents except as permitted pursuant to Section 3.8, this Section 10.1, 10.2 or 10.6 or in accordance with the procedures described in Sections 10.3, 10.4 or 10.5 as applicable. Notwithstanding the foregoing or anything in this Agreement to the contrary: (i) Transfers of Units or Unit Equivalents by a Member (or any Permitted Transferee of a Member) shall not be permitted prior to September 5, 2022 (after which time any such Transfer shall be subject to the restrictions in the first sentence of this Section 10.1(a)), except: (A) pursuant to Section 10.2; (B) when required pursuant to Section 10.4; or (C) when permitted by the Board; provided that if the Board permits any Class A Member (such Class A Member, the “Released Class A Member”) to sell or otherwise Transfer or dispose any Class A Units for value (whether in one or multiple transactions) pursuant to this Section 10.1(a)(i)(C) (such Class A Units, the “Released Class A Units”), then each other Class A Member shall also be permitted to, at any time, sell or Transfer the number of Class A Units held by the applicable other Class A Member equal to the product of (x) the number of Class A Units held by such other Class A Member multiplied by (y) the quotient of the number of the Released Class A Units divided by the total number of Class A Units owned by the Released Class A Member before the Transfer or disposal of the Released Class A Units; and provided, further, that unless the applicable Board approval permits otherwise, such Transfer shall be subject to the restrictions in the first sentence of this Section 10.1(a). (ii) No Transfer of Units or Unit Equivalents to a Person not already a Member of the Company shall be deemed completed until the prospective Transferee is admitted as a Member of the Company in accordance with Section 4.1 hereof. (b) Notwithstanding any other provision of this Agreement (including Section 10.2), prior to the consummation of a Qualified Public Offering, each Member agrees that it shall not, directly or indirectly, Transfer any of its Units or Unit Equivalents, and the Company agrees that it shall not issue any Units or Unit Equivalents: (i) except as permitted under the Securities Act and other applicable federal or state securities or blue sky laws, and then, with respect to a Transfer of Units or Unit Equivalents, if requested by the Company, only upon delivery to the Company of an opinion of counsel in form and substance satisfactory to the Company to the effect that such Transfer may be effected without registration under the Securities Act; (ii) if such Transfer or issuance would cause the Company to fail to qualify for the safe harbor of Treasury Regulation Section 1.7704-1(h)(1)(ii), including the look-through rule in Treasury Regulation Section 1.7704-1(h)(3); (iii) if such Transfer or issuance would affect the Company’s existence or qualification as a limited liability company under the Delaware Act; (iv) if such Transfer or issuance would cause the Company to lose its status as a partnership for federal income tax purposes; (v) if such Transfer or issuance would cause the Company or any of the Company Subsidiaries to be required to register as an investment company under the Investment Company Act of 1940, as amended; or (vi) if such Transfer or issuance would cause the assets of the Company or any of the Company Subsidiaries to be deemed “Plan Assets” as defined under the Employee Retirement Income Security Act of 1974 or its accompanying regulations or result in any “prohibited transaction” thereunder involving the Company or any Company Subsidiary. In any event, the Board may refuse the Transfer to any Person if the Board has received an opinion of counsel to the effect that such Transfer would have a material adverse effect on the Company as a result of any regulatory or other restrictions imposed by any Governmental Authority. (c) Any Transfer or attempted Transfer of any Units or Unit Equivalents in violation of any provisions of this Agreement shall be null and void, no such Transfer shall be recorded on the Company’s books and the purported Transferee in any such Transfer shall not be treated (and the purported Transferor shall continue be treated) as the owner of such Units or Unit Equivalents for all purposes of this Agreement, including without limitation, voting, payment of dividends and distributions with respect to such Units whether upon liquidation or otherwise. (d) For the avoidance of doubt, any Transfer of Units or Unit Equivalents permitted by Section 10.2 or made in accordance with the procedures described in Section 10.3, Section 10.4, Section 10.5 or 10.6, as applicable, and purporting to be a sale, transfer, assignment or other disposal of the entire Membership Interest represented by such Units or Unit Equivalents, inclusive of all the rights and benefits applicable to such Membership Interest as described in the definition of the term “Membership Interest,” shall be deemed a sale, transfer, assignment or other disposal of such Membership Interest in its entirety as intended by the parties to such Transfer, and shall not be deemed a sale, transfer, assignment or other disposal of any less than all of the rights and benefits described in the definition of the term “Membership Interest,” unless otherwise explicitly agreed to by the parties to such Transfer.
Appears in 6 contracts
Samples: Limited Liability Company Agreement, Limited Liability Company Agreement, Limited Liability Company Agreement
General Restrictions on Transfer. (a) Each Member acknowledges and agrees that, until the consummation of a Qualified Public Offering, such Member (or any Permitted Transferee of such Member) shall not Transfer any Units or Unit Equivalents except as permitted pursuant to Section 3.8, this Section 10.1, 10.2 or 10.6 or in accordance with the procedures described in Sections 10.3in, 10.4 or 10.5 as applicable. Notwithstanding the foregoing or anything in this Agreement to the contrary,
(i) Transfers of Incentive Units shall not be permitted prior to the consummation of a Qualified Public Offering except:
(iA) pursuant to Section 9.02;
(B) when required of a Drag-Along Member pursuant to Section 9.03;
(C) as set forth in Section 9.04; or
(D) as set forth in the Incentive Plan or applicable Award Agreement.
(ii) Transfers of Units or Unit Equivalents (other than Incentive Units which are covered by Section 9.01(a)(i) above) by a Management Member (or any Permitted Transferee of a Management Member) shall not be permitted prior to September 5, 2022 the second anniversary of the date of this Agreement (after which time any such Transfer shall be subject to the restrictions in the first sentence of this Section 10.1(a10.01(a)), except:
(A) pursuant to Section 10.210.02;
(B) when required of a Drag-Along Member pursuant to Section 10.49.03; or
(C) when permitted by the Board; provided that if the Board permits any Class A Member (such Class A Member, the “Released Class A Member”) to sell or otherwise Transfer or dispose any Class A Units for value (whether in one or multiple transactions) pursuant to this Section 10.1(a)(i)(C) (such Class A Units, the “Released Class A Units”), then each other Class A Member shall also be permitted to, at any time, sell or Transfer the number of Class A Units held by the applicable other Class A Member equal to the product of (x) the number of Class A Units held by such other Class A Member multiplied by (y) the quotient of the number of the Released Class A Units divided by the total number of Class A Units owned by the Released Class A Member before the Transfer or disposal of the Released Class A Units; and provided, further, that unless the applicable Board approval permits otherwise, such Transfer shall be subject to the restrictions in the first sentence of this Section 10.1(a).
(ii) No Transfer of Units or Unit Equivalents to a Person not already a Member of the Company shall be deemed completed until the prospective Transferee is admitted as a Member of the Company in accordance with Section 4.1 4.01(b) hereof.
(b) Notwithstanding any other provision of this Agreement (including Section 10.29.02), prior to the consummation of a Qualified Public Offering, each Member agrees that it shall will not, directly or indirectly, Transfer any of its Units or Unit Equivalents, and the Company agrees that it shall not issue any Units or Unit Equivalents:
(i) except as permitted under the Securities Act and other applicable federal or state securities or blue sky laws, and then, with respect to a Transfer of Units or Unit Equivalents, if requested by the Company, only upon delivery to the Company of an opinion of counsel in form and substance satisfactory to the Company to the effect that such Transfer may be effected without registration under the Securities Act;
(ii) if such Transfer or issuance would cause the Company to fail to qualify for be considered a “publicly traded partnership” under Section 7704(b) of the safe harbor Code within the meaning of Treasury Regulation Regulations Section 1.7704-1(h)(1)(ii), including the look-through rule in Treasury Regulation Regulations Section 1.7704-1(h)(3);
(iii) if such Transfer or issuance would affect the Company’s 's existence or qualification as a limited liability company under the Delaware Act;
(iv) if such Transfer or issuance would cause the Company to lose its status as a partnership for federal income tax purposes;
(v) if such Transfer or issuance would cause the Company or any of the Company Subsidiaries to be required to register as an investment company under the Investment Company Act of 1940, as amended; or
(vi) if such Transfer or issuance would cause the assets of the Company or any of the Company Subsidiaries to be deemed “Plan Assets” as defined under the Employee Retirement Income Security Act of 1974 or its accompanying regulations or result in any “prohibited transaction” thereunder involving the Company or any Company Subsidiary. In any event, the Board may refuse the Transfer to any Person if the Board has received an opinion of counsel to the effect that such Transfer would have a material adverse effect on the Company as a result of any regulatory or other restrictions imposed by any Governmental Authority.
(c) Any Transfer or attempted Transfer of any Units or Unit Equivalents in violation of any provisions of this Agreement shall be null and void, no such Transfer shall be recorded on the Company’s books 's books, and the purported Transferee in any such Transfer shall not be treated (and the purported Transferor shall continue be treated) as the owner of such Units or Unit Equivalents for all purposes of this Agreement, including without limitation, voting, payment of dividends and distributions with respect to such Units whether upon liquidation or otherwise.
(d) For the avoidance of doubt, any Transfer of Units or Unit Equivalents permitted by Section 10.2 10.02 or made in accordance with the procedures described in Section 10.3, Section 10.4, Section 10.5 or 10.610.03, as applicable, and purporting to be a sale, transfer, assignment assignment, or other disposal of the entire Membership Interest represented by such Units or Unit Equivalents, inclusive of all the rights and benefits applicable to such Membership Interest as described in the definition of the term “Membership Interest,” shall be deemed a sale, transfer, assignment assignment, or other disposal of such Membership Interest in its entirety as intended by the parties to such Transfer, and shall not be deemed a sale, transfer, assignment assignment, or other disposal of any less than all of the rights and benefits described in the definition of the term “Membership Interest,” unless otherwise explicitly agreed to by the parties to such Transfer.
Appears in 1 contract
General Restrictions on Transfer. (a) Each Member acknowledges and agrees that, until the consummation of a Qualified Public Offering, such Member (or any Permitted Transferee of such Member) shall not Transfer any Units or Unit Equivalents except as permitted pursuant to Section 3.8, this Section 10.1, 10.2 or 10.6 or in accordance with the procedures described in Sections 10.3, 10.4 or 10.5 as applicable. Notwithstanding the foregoing or anything in this Agreement to the contrary:
(i) Transfers of Units or Unit Equivalents by a Member (or any Permitted Transferee of a Member) shall not be permitted prior to September 5, 2022 (after which time any such Transfer shall be subject to the restrictions in the first sentence of this Section 10.1(a)), except:
(A) pursuant to Section 10.2;
(B) when required pursuant to Section 10.4; or
(C) when permitted by the Board; provided that if the Board permits any Except for Class A Member (such Permitted Transfers or Transfers to an entity or entities that are directly or indirectly Controlled by JLA, no Class A MemberMember shall Transfer, the “Released Class A Member”) to sell directly or otherwise Transfer indirectly, voluntarily or dispose involuntarily, all or any portion of its Class A Units for value (whether in one or multiple transactions) pursuant to this Section 10.1(a)(i)(C) (without the unanimous written consent of the Executive Committee. If the Executive Committee does not approve of a Transfer of such Class A Units, any unapproved Transferee of the “Released Class A Units”), then each other Class A Member shall also be permitted to, at any time, sell or Transfer the number of relevant Class A Units held by shall have no right to participate in the applicable other Class A Member equal to the product of (x) the number of Class A Units held by such other Class A Member multiplied by (y) the quotient management or conduct of the number Company’s activities and affairs or to become or continue to be a Member of the Released Class A Units divided by Company (or exercise any rights or powers of a Member including, any voting rights), except as otherwise provided in the total number of Class A Units owned by Act, and the Released Class A Member before Transferee shall only be a “transferee” within the Transfer or disposal meaning of the Released Class A Units; Act and provided, further, that unless the applicable Board approval permits otherwise, such Transfer shall be subject entitled to receive only the restrictions in distributions to which the first sentence of this Section 10.1(a)Transferor Member otherwise would be entitled.
(iib) Except for BBX Permitted Transfers and as provided in Section 9.02, until the Phase 2 Closing, no Class B Member shall Transfer, directly or indirectly, voluntarily or involuntarily, all or any portion of its Class B Units without the unanimous written consent of the Executive Committee. If the Executive Committee does not approve of a Transfer of such Class B Units, any unapproved Transferee of the relevant Class B Units shall have no right to participate in the management or conduct of the Company’s activities and affairs or to become or continue to be a Member of the Company (or exercise any rights or powers of a Member including, any voting rights), except as otherwise provided in the Act, and the Transferee shall only be a “transferee” within the meaning of the Act and shall be entitled to receive only the distributions to which the Transferor Member otherwise would be entitled. For the avoidance of doubt, after the Phase 2 Closing, no Class B Member shall Transfer, directly or indirectly, voluntarily or involuntarily, all or any portion of its Class B Units without the majority written consent of the Executive Committee.
(c) No Transfer of Units or Unit Equivalents to a Person not already a Member of the Company shall be deemed completed until the prospective Transferee is admitted as a Member of the Company in accordance with Section 4.1 hereof.
(b) Notwithstanding any other provision of this Agreement (including Section 10.24.01(b), . No Member shall have the power or right to voluntarily withdraw or dissociate from the Company prior to the consummation of a Qualified Public Offering, each Member agrees that it shall not, directly or indirectly, Transfer any of its Units or Unit Equivalents, dissolution and the Company agrees that it shall not issue any Units or Unit Equivalents:
(i) except as permitted under the Securities Act and other applicable federal or state securities or blue sky laws, and then, with respect to a Transfer of Units or Unit Equivalents, if requested by the Company, only upon delivery to the Company of an opinion of counsel in form and substance satisfactory to the Company to the effect that such Transfer may be effected without registration under the Securities Act;
(ii) if such Transfer or issuance would cause the Company to fail to qualify for the safe harbor of Treasury Regulation Section 1.7704-1(h)(1)(ii), including the look-through rule in Treasury Regulation Section 1.7704-1(h)(3);
(iii) if such Transfer or issuance would affect the Company’s existence or qualification as a limited liability company under the Delaware Act;
(iv) if such Transfer or issuance would cause the Company to lose its status as a partnership for federal income tax purposes;
(v) if such Transfer or issuance would cause the Company or any winding up of the Company Subsidiaries and any such withdrawal or dissociation or attempted withdrawal or dissociation by a Member prior to be required to register as an investment company under the Investment Company Act of 1940, as amended; or
(vi) if such Transfer or issuance would cause the assets dissolution and winding up of the Company or any of the Company Subsidiaries to be deemed “Plan Assets” as defined under the Employee Retirement Income Security Act of 1974 or its accompanying regulations or result in any “prohibited transaction” thereunder involving the Company or any Company Subsidiary. In any event, the Board may refuse the Transfer to any Person if the Board has received an opinion of counsel to the effect that such Transfer would have a material adverse effect on the Company as a result of any regulatory or other restrictions imposed by any Governmental Authority.
(c) Any Transfer or attempted Transfer of any Units or Unit Equivalents in violation of any provisions of this Agreement shall be null and void, no such Transfer shall be recorded on the Company’s books and the purported Transferee in any such Transfer shall not be treated (and the purported Transferor shall continue be treated) as the owner of such Units or Unit Equivalents for all purposes of this Agreement, including without limitation, voting, payment of dividends and distributions with respect to such Units whether upon liquidation or otherwise.
(d) For the avoidance of doubt, any Transfer of Units or Unit Equivalents permitted by Section 10.2 or made in accordance with the procedures described in Section 10.3, Section 10.4, Section 10.5 or 10.6, as applicable, and purporting to be a sale, transfer, assignment or other disposal of the entire Membership Interest represented by such Units or Unit Equivalents, inclusive of all the rights and benefits applicable to such Membership Interest as described in the definition of the term “Membership Interest,” shall be deemed a sale, transfer, assignment or other disposal of such Membership Interest in its entirety as intended by the parties to such Transfer, and shall not be deemed a sale, transfer, assignment or other disposal of any less than all of the rights and benefits described in the definition of the term “Membership Interest,” unless otherwise explicitly agreed to by the parties to such Transfer.
Appears in 1 contract
General Restrictions on Transfer. (a) Each Member acknowledges and agrees that, until the consummation of a Qualified an Initial Public Offering, such Member (or any Permitted Transferee of such Member) shall not Transfer any Units or Unit Equivalents except as permitted pursuant to Section 3.8, this Section 10.1, 10.2 or 10.6 10.02 or in accordance with the procedures described in Sections 10.3, 10.4 or 10.5 Section 10.03 through Section 10.05 as applicable. Notwithstanding the foregoing or anything in this Agreement to the contrary:
(i) Transfers of Incentive Units shall not be permitted prior to the consummation of an Initial Public Offering except:
(A) pursuant to Section 10.02;
(B) when required of a Drag-along Member pursuant to Section 10.04; or
(C) as set forth in the Incentive Plan or applicable Award Agreement.
(ii) Transfers of Units or Unit Equivalents (other than Incentive Units which are covered by Section 10.01(a)(i) above) by a Member (or any Permitted Transferee of a Member) shall not be permitted prior to September 5, 2022 the first anniversary of the date of this Agreement (after which time any such Transfer shall be subject to the restrictions in the first sentence of this Section 10.1(a10.01(a)), except:
(A) pursuant to Section 10.2;
10.02; (B) when required of a Drag-along Member pursuant to Section 10.410.04; or
(C) when permitted upon the exercise of a tag-along right by the Board; provided that if the Board permits any Class A a Tag-along Member (such Class A Member, the “Released Class A Member”) to sell or otherwise Transfer or dispose any Class A Units for value (whether in one or multiple transactions) pursuant to this Section 10.1(a)(i)(C) (such Class A Units, the “Released Class A Units”), then each other Class A Member shall also be permitted to, at any time, sell or Transfer the number of Class A Units held by the applicable other Class A Member equal to the product of (x) the number of Class A Units held by such other Class A Member multiplied by (y) the quotient of the number of the Released Class A Units divided by the total number of Class A Units owned by the Released Class A Member before the Transfer or disposal of the Released Class A Units; and provided, further, that unless the applicable Board approval permits otherwise, such Transfer shall be subject to the restrictions in the first sentence of this Section 10.1(a).
(ii) 10.05. No Transfer of Units or Unit Equivalents to a Person not already a Member of the Company shall be deemed completed until the prospective Transferee is admitted as a Member of the Company in accordance with Section 4.1 4.01(b) hereof.
(b) Notwithstanding any other provision of this Agreement (including Section 10.210.02), prior to the consummation of a Qualified an Initial Public Offering, each Member agrees that it shall will not, directly or indirectly, Transfer any of its Units or Unit Equivalents, and the Company agrees that it shall not issue any Units or Unit Equivalents:
(i) except as permitted under the Securities Act and other applicable federal or state securities or blue sky laws, and then, with respect to a Transfer of Units or Unit Equivalents, if requested by the Company, only upon delivery to the Company of an opinion of counsel in form and substance satisfactory to the Company to the effect that such Transfer may be effected without registration under the Securities Act;
(ii) if such Transfer or issuance would cause the Company to fail to qualify for be considered a “publicly traded partnership” under Section 7704(b) of the safe harbor Code within the meaning of Treasury Regulation Section 1.7704-1(h)(1)(ii), including the look-through rule in Treasury Regulation Section 1.7704-1(h)(3);
(iii) if such Transfer or issuance would affect the Company’s existence or qualification as a limited liability company under the Delaware Act;
(iv) if such Transfer or issuance would cause the Company to lose its status as a partnership for U.S. federal income tax purposes, unless such Transfer has received prior approval of the Board;
(v) if such Transfer or issuance would cause a termination of the Company for U.S. federal income tax purposes, unless such Transfer has received prior approval of the Board;
(vi) if such Transfer or issuance would cause the Company or any of the Company Subsidiaries to be required to register as an investment company under the Investment Company Act of 1940, as amended; or
(vivii) if such Transfer or issuance would cause the assets of the Company or any of the Company Subsidiaries Subsidiary to be deemed “Plan Assets” as defined under the Employee Retirement Income Security Act of 1974 or its accompanying regulations or result in any “prohibited transaction” thereunder involving the Company or any Company Subsidiary. In any event, the Board may refuse the Transfer to any Person if the Board has received an opinion of counsel to the effect that such Transfer would have a material adverse effect on the Company as a result of any regulatory or other restrictions imposed by any Governmental Authority.
(c) Any Transfer or attempted Transfer of any Units or Unit Equivalents in violation of any provisions of this Agreement shall be null and void, no such Transfer shall be recorded on the Company’s books and the purported Transferee in any such Transfer shall not be treated (and the purported Transferor shall continue be treated) as the owner of such Units or Unit Equivalents for all purposes of this Agreement, including without limitation, voting, payment of dividends and distributions with respect to such Units whether upon liquidation or otherwise.
(d) For the avoidance of doubt, any Transfer of Units or Unit Equivalents permitted by Section 10.2 10.02 or made in accordance with the procedures described in Section 10.3, 10.03 through Section 10.4, Section 10.5 or 10.610.05, as applicable, and purporting to be a sale, transfer, assignment or other disposal of the entire Membership Interest represented by such Units or Unit Equivalents, inclusive of all the rights and benefits applicable to such Membership Interest as described in the definition of the term “Membership Interest,” shall be deemed a sale, transfer, assignment or other disposal of such Membership Interest in its entirety as intended by the parties to such Transfer, and shall not be deemed a sale, transfer, assignment or other disposal of any less than all of the rights and benefits described in the definition of the term “Membership Interest,” unless otherwise explicitly agreed to by the parties to such Transfer.
(e) Except with respect to a Permitted Transfer pursuant to Section 10.02(a) or (b) (and, if Board approval is obtained specifically exempting such Transfer from the provisions of this Section 10.01(e), pursuant to Section 10.02(c)), in connection with any Transfer of Non-dilutive Common Units, each Non-dilutive Common Unit being Transferred shall automatically and without further action on the part of the Company, any Member or any other Person, be converted to a Class A Common Unit immediately prior to the consummation of such Transfer.
Appears in 1 contract
Samples: Limited Liability Company Agreement (Liquid Holdings Group LLC)
General Restrictions on Transfer. (a) Each Member acknowledges and agrees that, until the consummation of a Qualified Public Offering, such Member (or any Permitted Transferee of such Member) shall not Transfer any Units or Unit Equivalents except as permitted pursuant to Section 3.8, this Section 10.1, 10.2 or 10.6 10.02 or in accordance with the procedures described in Sections 10.3Section 10.03 through Section 10.07, 10.4 or 10.5 as applicable. Notwithstanding the foregoing or anything in this Agreement to the contrary,
(i) Transfers of Incentive Units shall not be permitted prior to the consummation of a Qualified Public Offering except:
(iA) pursuant to Section 10.02;
(B) when required of a Drag-along Member pursuant to Section 10.04;
(C) as set forth in Section 10.06 and Section 10.07; or
(D) as set forth in the Incentive Plan or applicable Award Agreement.
(ii) Transfers of Units or Unit Equivalents (other than Incentive Units which are covered by Section 10.01(a)(i) above) by a Member (or any Permitted Transferee of a Member) shall not be permitted prior to September 5, 2022 the first anniversary of the date of this Agreement (after which time any such Transfer shall be subject to the restrictions in the first sentence of this Section 10.1(a10.01(a)), except:
(A) pursuant to Section 10.210.02;
(B) when required of a Drag-along Member pursuant to Section 10.410.04; or
(C) when permitted upon the exercise of a tag-along right by the Board; provided that if the Board permits any Class A a Tag-along Member (such Class A Member, the “Released Class A Member”) to sell or otherwise Transfer or dispose any Class A Units for value (whether in one or multiple transactions) pursuant to this Section 10.1(a)(i)(C) (such Class A Units, the “Released Class A Units”), then each other Class A Member shall also be permitted to, at any time, sell or Transfer the number of Class A Units held by the applicable other Class A Member equal to the product of (x) the number of Class A Units held by such other Class A Member multiplied by (y) the quotient of the number of the Released Class A Units divided by the total number of Class A Units owned by the Released Class A Member before the Transfer or disposal of the Released Class A Units; and provided, further, that unless the applicable Board approval permits otherwise, such Transfer shall be subject to the restrictions in the first sentence of this Section 10.1(a).
(ii) 10.05. No Transfer of Units or Unit Equivalents to a Person not already a Member of the Company shall be deemed completed until the prospective Transferee is admitted as a Member of the Company in accordance with Section 4.1 4.01(b) hereof.
(b) Notwithstanding any other provision of this Agreement (including Section 10.210.02), prior to the consummation of a Qualified Public Offering, each Member agrees that it shall will not, directly or indirectly, Transfer any of its Units or Unit Equivalents, and the Company agrees that it shall not issue any Units or Unit Equivalents:
(i) except as permitted under the Securities Act and other applicable federal or state securities or blue sky laws, and then, with respect to a Transfer of Units or Unit Equivalents, if requested by the Company, only upon delivery to the Company of an opinion of counsel in form and substance satisfactory to the Company to the effect that such Transfer may be effected without registration under the Securities Act;
(ii) if such Transfer or issuance would cause the Company to fail to qualify for be considered a “publicly traded partnership” under Section 7704(b) of the safe harbor Code within the meaning of Treasury Regulation Section 1.7704-1(h)(1)(ii), including the look-through rule in Treasury Regulation Section 1.7704-1(h)(3);
(iii) if such Transfer or issuance would affect the Company’s existence or qualification as a limited liability company under the Delaware Virginia Act;
(iv) if such Transfer or issuance would cause the Company to lose its status as a partnership for federal income tax purposes;
(v) if such Transfer or issuance would cause a termination of the Company for federal income tax purposes;
(vi) if such Transfer or issuance would cause the Company or any of the Company Subsidiaries to be required to register as an investment company under the Investment Company Act of 1940, as amended; or
(vivii) if such Transfer or issuance would cause the assets of the Company or any of the Company Subsidiaries to be deemed “Plan Assets” as defined under the Employee Retirement Income Security Act of 1974 or its accompanying regulations or result in any “prohibited transaction” thereunder involving the Company or any Company Subsidiary. In any event, the Board may refuse the Transfer to any Person if the Board has received an opinion of counsel to the effect that such Transfer would have a material adverse effect on the Company as a result of any regulatory or other restrictions imposed by any Governmental Authority.
(c) Any Transfer or attempted Transfer of any Units or Unit Equivalents in violation of any provisions of this Agreement shall be null and void, no such Transfer shall be recorded on the Company’s books and the purported Transferee in any such Transfer shall not be treated (and the purported Transferor shall continue be treated) as the owner of such Units or Unit Equivalents for all purposes of this Agreement, including without limitation, voting, payment of dividends and distributions with respect to such Units whether upon liquidation or otherwise.
(d) For the avoidance of doubt, any Transfer of Units or Unit Equivalents permitted by Section 10.2 10.02 or made in accordance with the procedures described in Section 10.3, 10.03 through Section 10.4, Section 10.5 or 10.610.07, as applicable, and purporting to be a sale, transfer, assignment or other disposal of the entire Membership Interest represented by such Units or Unit Equivalents, inclusive of all the rights and benefits applicable to such Membership Interest as described in the definition of the term “Membership Interest,” shall be deemed a sale, transfer, assignment or other disposal of such Membership Interest in its entirety as intended by the parties to such Transfer, and shall not be deemed a sale, transfer, assignment or other disposal of any less than all of the rights and benefits described in the definition of the term “Membership Interest,” unless otherwise explicitly agreed to by the parties to such Transfer.
Appears in 1 contract
General Restrictions on Transfer. (a) Each Member acknowledges and agrees that, until the consummation of a Qualified Public Offering, that such Member (or any Permitted Transferee of such Member) shall not Transfer any Units or Unit Equivalents except as permitted pursuant to Section 3.8, this Section 10.1, 10.2 or 10.6 10.02 or in accordance with the procedures described in Sections 10.3Section 10.03 through Section 10.05, 10.4 or 10.5 as applicable. Notwithstanding the foregoing or anything in this Agreement to the contrary:,
(i) Transfers of Common Units or Unit Equivalents by a Member (or granted pursuant to any Permitted Transferee of a Member) Incentive Plan shall not be permitted prior to September 5, 2022 (after which time any such Transfer shall be subject to the restrictions in the first sentence of this Section 10.1(a)), except:
(A1) pursuant to Section 10.210.02;
(B2) when required of a Drag-along Member pursuant to Section 10.410.04; or
(C3) when permitted by the Board; provided that if the Board permits as set forth in any Class A Member (such Class A Member, the “Released Class A Member”) to sell Incentive Plan or otherwise Transfer or dispose any Class A Units for value (whether in one or multiple transactions) pursuant to this Section 10.1(a)(i)(C) (such Class A Units, the “Released Class A Units”), then each other Class A Member shall also be permitted to, at any time, sell or Transfer the number of Class A Units held by the applicable other Class A Member equal to the product of (x) the number of Class A Units held by such other Class A Member multiplied by (y) the quotient of the number of the Released Class A Units divided by the total number of Class A Units owned by the Released Class A Member before the Transfer or disposal of the Released Class A Units; and provided, further, that unless the applicable Board approval permits otherwise, such Transfer shall be subject to the restrictions in the first sentence of this Section 10.1(a)Award Agreement.
(iib) No Transfer of Units or Unit Equivalents to a Person not already a Member of the Company shall be deemed completed until the prospective Transferee is admitted as a Member of the Company in accordance with Section 4.1 4.01(b) hereof.
(bc) Notwithstanding any other provision of this Agreement (including Section 10.2), prior to the consummation of a Qualified Public Offering, 10.02) each Member agrees that it shall will not, directly or indirectly, Transfer any of its Units or Unit Equivalents, and the Company agrees that it shall not issue any Units or Unit Equivalents:
(i) except as permitted under the Securities Act and other applicable federal or state securities or blue sky laws, and then, with respect to a Transfer of Units or Unit Equivalents, if requested by the Company, only upon delivery to the Company of an opinion of counsel in form and substance satisfactory to the Company to the effect that such Transfer may be effected without registration under the Securities Act;
(ii) if such Transfer or issuance occurs prior to the Corporate Election Effective Date and would cause the Company to fail to qualify for be considered a “publicly traded partnership” under Section 7704(b) of the safe harbor Code within the meaning of Treasury Regulation Section 1.7704-1(h)(1)(ii), including the look-through rule in Treasury Regulation Section 1.7704-1(h)(3);
(iii) if such Transfer or issuance would affect the Company’s existence or qualification as a limited liability company under the Delaware Actcompany;
(iv) if such Transfer or issuance occurs prior to the Corporate Election Effective Date and would cause the Company to lose its status as a partnership for federal income tax purposes;
(v) if such Transfer or issuance occurs prior to the Corporate Election Effective Date and would cause a termination of the Company for federal income tax purposes;
(vi) if such Transfer or issuance would cause the Company or any of the Company Subsidiaries to be required to register as an investment company under the Investment Company Act of 1940, as amended; or
or (vivii) if such Transfer or issuance would cause the assets of the Company or any of the Company Subsidiaries to be deemed “Plan Assets” as defined under the Employee Retirement Income Security Act of 1974 or its accompanying regulations or result in any “prohibited transaction” thereunder involving the Company or any Company Subsidiary. In any event, the Board may refuse the Transfer to any Person if the Board has received an opinion of counsel to the effect that such Transfer would have a material adverse effect on the Company as a result of any regulatory or other restrictions imposed by any Governmental Authority.
(cd) Any Transfer or attempted Transfer of any Units or Unit Equivalents in violation of any provisions of this Agreement shall be null and void, no such Transfer shall be recorded on the Company’s books and the purported Transferee in any such Transfer shall not be treated (and the purported Transferor shall continue be treated) as the owner of such Units or Unit Equivalents for all purposes of this Agreement, including without limitation, voting, payment of dividends and distributions with respect to such Units whether upon liquidation or otherwise.
(de) For the avoidance of doubt, any Transfer of Units or Unit Equivalents permitted by Section 10.2 10.02 or made in accordance with the procedures described in Section 10.3, 10.03 through Section 10.4, Section 10.5 or 10.610.05, as applicable, and purporting to be a sale, transfer, assignment or other disposal of the entire Membership Interest represented by such Units or Unit Equivalents, inclusive of all the rights and benefits applicable to such Membership Interest as described in the definition of the term “Membership Interest,” , shall be deemed a sale, transfer, assignment or other disposal of such Membership Interest in its entirety as intended by the parties to such Transfer, and shall not be deemed a sale, transfer, assignment or other disposal of any less than all of the rights and benefits described in the definition of the term “Membership Interest,” Interest unless otherwise explicitly agreed to by the parties to such Transfer.
Appears in 1 contract
Samples: Limited Liability Company Agreement (Ascend Wellness Holdings, LLC)
General Restrictions on Transfer. (a) Each Member acknowledges and agrees that, until the consummation of a Qualified Public Offering, such Member (or any Permitted Transferee of such Member) shall not Transfer any Units or Unit Equivalents except as permitted pursuant to Section 3.8, this Section 10.1, 10.2 or 10.6 or in accordance with the procedures described in Sections 10.3, 10.4 or 10.5 as applicable. Notwithstanding the foregoing or anything in this Agreement to the contrary:
(i) Transfers of Units or Unit Equivalents by a Member (or any Permitted Transferee of a Member) shall not be permitted prior to September 5, 2022 (after which time any such Transfer shall be subject to the restrictions in the first sentence of this Section 10.1(a)), except:
(A) pursuant to Section 10.2;
(B) when required pursuant to Section 10.4; or
(C) when permitted by the Board; provided that if the Board permits any Class A Member (such Class A Member, the “Released Class A Member”) to sell or otherwise Transfer or dispose any Class A Units for value (whether in one or multiple transactions) pursuant to this Section 10.1(a)(i)(C) (such Class A Units, the “Released Class A Units”), then each other Class A Member shall also be permitted to, at any time, sell or Transfer the number of Class A Units held by the applicable other Class A Member equal to the product of (x) the number of Class A Units held by such other Class A Member multiplied by (y) the quotient of the number of the Released Class A Units divided by the total number of Class A Units owned by the Released Class A Member before the Transfer or disposal of the Released Class A Units; and provided, further, that unless the applicable Board approval permits otherwise, such Transfer shall be subject to the restrictions in the first sentence of this Section 10.1(a).
(ii) No Transfer of Units or Unit Equivalents to a Person not already a Member of the Company shall be deemed completed until the prospective Transferee is admitted as a Member of the Company in accordance with Section 4.1 hereof.
(b) Notwithstanding any other provision of this Agreement (including Section 10.2), prior to the consummation of a Qualified Public Offering, each Member agrees that it shall not, directly or indirectly, Transfer any of its Units or Unit Equivalents, and the Company Stockholder agrees that it shall not issue Transfer any Units or Unit Equivalents:
of its Shares at any time if such Transfer: (i) except as permitted under the Securities Act is to a Person who is not an original party to this Agreement and other applicable has not become a party to this Agreement by executing and delivering a Joinder Agreement; (ii) is to a Competitor; (iii) does not or would not comply with U.S. federal or state securities or blue sky laws, and then, with respect to a Transfer of Units or Unit Equivalents, if requested by the Company, only upon delivery to the Company of an opinion of counsel in form and substance satisfactory to the Company to the effect that such Transfer may be effected without registration under the Securities Act;
(ii) if such Transfer or issuance would cause the Company to fail to qualify for the safe harbor of Treasury Regulation Section 1.7704-1(h)(1)(ii), including the look-through rule in Treasury Regulation Section 1.7704-1(h)(3);
(iii) if such Transfer or issuance would affect the Company’s existence or qualification as a limited liability company under the Delaware Act;
other applicable law; (iv) if such Transfer or issuance would cause the Company is prohibited pursuant to lose its status as a partnership for federal income tax purposes;
Section 5.2(b); (v) if such Transfer would, individually or issuance would together with other concurrently proposed Transfers, cause the Company or any of the Company Subsidiaries Corporation to be required to register regarded as an “investment company company” under the Investment Company Act of 1940, as amended, and the rules and regulations promulgated thereunder; or
or (vi) if applicable, would not be compliant with the requirements of Article 6 or Article 8 or otherwise violates any other provision of this Agreement.
(b) No Stockholder shall Transfer any of such Stockholder’s Shares to any other Person without prior written approval from the Board to the extent such Transfer or issuance would cause the assets of the Company or any of the Company Subsidiaries Corporation to be deemed “Plan Assets” as defined under the Employee Retirement Income Security Act of 1974 or its accompanying regulations or result in any “prohibited transaction” thereunder involving the Company or any Company Subsidiary. In any eventhave, the Board may refuse the Transfer to any Person if the Board has received an opinion of counsel to the effect that such Transfer would have a material adverse effect on the Company including as a result of passage of time and giving effect to the exercise or conversion of any regulatory Derivative Securities, in excess of (a) 1,950 Stockholders of record (or four-hundred-fifty (450) or more Stockholders of record who are not Accredited Investors), calculated in accordance with Section 12(g) of the Exchange Act (or fifty (50) fewer than such other restrictions imposed by numbers of Stockholders of record or shareholders as may subsequently be set forth in Section 12(g), or any Governmental Authoritysuccessor provision, from time to time of the Exchange Act, as the minimum number of Stockholders of record or shareholders for a class of capital stock that would require the Corporation to register such class of capital stock under Section 12 of the Exchange Act) or (b) two-hundred-fifty (250) Stockholders of record, calculated in accordance with Section 15(d) of the Exchange Act (or fifty (50) fewer than such other numbers of shareholders as may subsequently be set forth in Section 15(d), or any successor provision, from time to time of the Exchange Act, as the minimum number of Stockholders of record or shareholders for a class of capital stock that would require reporting under Section 15(d) of the Exchange Act). The Corporation and any transfer agent for the Shares shall be entitled to enforce this provision (including denying any requested Transfer). The Corporation and any transfer agent for the Shares shall determine the number of Stockholders of record from time to time in consultation with the Corporation’s counsel in order to give full effect to the restriction set forth in this Section 5.2(b).
(c) Any Transfer or attempted Prior to effectuating any Transfer of any Units or Unit Equivalents in violation of any provisions of this Agreement shall be null and voidShares, no the Stockholder proposing to make such Transfer shall deliver to the Corporation:
(i) the transfer certificate a form of which is attached hereto as Exhibit C;
(ii) such information as the Corporation may reasonably request in order for the Corporation to determine in good faith that the proposed Transfer will be recorded on made in compliance with Section 5.2(a) (including information, opinions of counsel or other certifications used to determine whether any Person to whom the Company’s books proposed Transfer is to be made is not a Competitor and the purported Transferee in any such Transfer shall not be treated complies with U.S. federal or state securities laws or other applicable law) and Article 6; and
(and the purported Transferor shall continue be treatediii) such information as the owner of such Units or Unit Equivalents for all purposes of this Agreement, including without limitation, voting, payment of dividends and distributions with respect to such Units whether upon liquidation or otherwiseCorporation’s transfer agent may reasonably request.
(d) For Each Stockholder will not, during the avoidance term of doubtthis Agreement, directly or indirectly, make any Transfer of Units all or Unit Equivalents permitted any portion of its Shares unless, prior to the consummation of any such Transfer, the proposed transferee, if not already a Stockholder executes and delivers a Joinder Agreement. Upon the execution and delivery by Section 10.2 or made in accordance such proposed transferee of a Joinder Agreement and compliance with the procedures described in Section 10.3, Section 10.4, Section 10.5 or 10.6, as applicable, and purporting to be a sale, transfer, assignment or other disposal provisions of the entire Membership Interest represented by such Units or Unit Equivalents, inclusive of all the rights and benefits applicable to such Membership Interest as described in the definition of the term “Membership Interest,” shall be deemed a sale, transfer, assignment or other disposal of such Membership Interest in its entirety as intended by the parties Agreement with respect to such Transfer, and shall not such proposed transferee will be deemed a sale“Stockholder” and will have the rights and be subject to the obligations of a Stockholder under this Agreement with respect to Shares owned by such proposed transferee. This Section 5.2(d) shall not apply to a Transfer arising due to a Transfer of an interest in a Stockholder.
(e) Notwithstanding anything to the contrary in this Agreement, transferbut subject to Section 5.2(b), assignment each Stockholder may (i) Transfer all or any portion of its Shares to any Affiliate of such Stockholder, (ii) if such Stockholder is an AHG Stockholder, Transfer all or any portion of its Shares to any equityholder of such Stockholder and (iii) in the case of a Stockholder that is a natural person, Transfer all or any portion of its Shares for bona fide estate planning purposes, either during such Stockholder’s lifetime or on death by will or intestacy to such Stockholder’s spouse, including any life partner or similar statutorily-recognized domestic partner, child (natural or adopted), or any other disposal direct lineal descendant of such Stockholder (or such person’s spouse, including any less than life partner or similar statutorily-recognized domestic partner) (all of the rights foregoing collectively referred to as “Family Members”) or any custodian or trustee of any trust, partnership, limited liability Corporation or other corporate entity for the benefit of, or the ownership interests of which are owned wholly by such Stockholder or any such Family Members for so long as such transferee executes and benefits described delivers a Joinder Agreement pursuant to Section 5.2(d).
(f) Notwithstanding anything to the contrary in the definition of the term “Membership Interest,” unless otherwise explicitly agreed this Agreement, this Section 5.2 shall not apply to any Transfers pursuant to (i) any Strategic Alternative approved by the parties Strategic Review Committee or any Sale Transaction to such Transferwhich Article 8 applies and (ii) any DTC Facilities Exit Transfer consummated in accordance with Section 5.1(c).
Appears in 1 contract
Samples: Stockholders Agreement (WeWork Inc.)
