------------------------------------------------------------------------------
FIRST AMENDED AND RESTATED
COMPANY AGREEMENT
OF
SYNTROLEUM/SWEETWATER COMPANY, L.L.C.
A DELAWARE LIMITED LIABILITY COMPANY
EFFECTIVE AS OF JANUARY 12, 1998
------------------------------------------------------------------------------
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
TABLE OF CONTENTS
ARTICLE 1 DEFINITIONS......................................................... 2
ARTICLE 2 FORMATION OF COMPANY................................................ 11
2.1 Formation............................................. 11
2.2 Name.................................................. 11
2.3 Principal Place of Business........................... 11
2.4 Registered Office and Registered Agent................ 11
2.5 Term.................................................. 11
ARTICLE 3 BUSINESS OF COMPANY................................................. 12
ARTICLE 4 NAMES AND ADDRESSES OF MEMBERS...................................... 12
ARTICLE 5 RIGHTS AND DUTIES OF MANAGER........................................ 12
5.1 Management............................................ 12
5.2 Number, Tenure and Qualifications..................... 13
5.3 Certain Powers of Manager............................. 13
5.4 Power of Others........................................14
5.5 Operating Committee....................................15
5.6 Limitations on Authority.............................. 18
5.7 Liability for Certain Acts............................ 19
5.8 Managers and Members Have No Exclusive
Duty to Company...................................... 19
5.9 Bank Accounts......................................... 19
5.10 Indemnification....................................... 19
5.11 Resignation........................................... 20
5.12 Removal............................................... 20
5.13 Vacancies............................................. 20
5.14 Compensation, Reimbursement, Organization Expenses.... 21
5.15 Right to Rely on the Manager.......................... 21
i
Syntroleum-Sweetwater Company Agreement
---------------------------------------------------------------------------
CONFIDENTIAL
ARTICLE 6 RIGHTS AND OBLIGATIONS OF MEMBERS................................... 22
6.1 Limitation of Liability............................... 22
6.2 Company Debt Liability................................ 22
6.3 Company Books......................................... 22
6.4 Priority and Return of Capital........................ 22
6.5 Dealing with Members...................................22
ARTICLE 7 MEETINGS OF MEMBERS................................................. 23
7.1 Annual Meeting........................................ 23
7.2 Special Meetings...................................... 23
7.3 Place of Meetings..................................... 23
7.4 Notice of Meetings.................................... 23
7.5 Meeting of all Members................................ 23
7.6 Record Date........................................... 23
7.7 Quorum................................................ 24
7.8 Manner of Acting...................................... 24
7.9 Proxies............................................... 24
7.10 Action by Members Without a Meeting................... 24
7.11 Waiver of Notice...................................... 25
ARTICLE 8 CAPITAL CONTRIBUTIONS AND CAPITAL ACCOUNTS.......................... 25
8.1 Initial Contributions................................. 25
8.2 First Closing; ECT Admission as Class B Member........ 25
8.3 Second Closing; Payment of Capital Commitments
of Additional Class B Members........................ 26
8.4 Additional Class A Members............................ 28
8.5 Capital Accounts...................................... 28
8.6 Withdrawal or Reduction of Members'
Contributions to Capital............................ 30
ARTICLE 9 ALLOCATIONS, INCOME TAX, DISTRIBUTIONS, ELECTIONS AND REPORTS....... 30
9.1 Allocations of Profits and Losses from Operations..... 30
9.2 Special Allocations to Capital Accounts and Certain
ii
Syntroleum-Sweetwater Company Agreement
---------------------------------------------------------------------------
CONFIDENTIAL
Other Income Tax Allocations.......................... 30
9.3 Distributions......................................... 34
9.4 Structuring Fee........................................34
9.5 Limitation Upon Distributions......................... 35
9.6 Accounting Principles................................. 35
9.7 Interest On and Return of Capital Contributions....... 35
9.8 Loans to Company...................................... 35
9.9 Accounting Period..................................... 35
9.10 Records, Audits and Reports........................... 35
9.11 Returns and other Elections........................... 36
ARTICLE 10 TRANSFERABILITY, WITHDRAWAL AND CESSATION OF MEMBERSHIP............. 36
10.1 General............................................... 36
10.2 Right of First Refusal................................ 37
10.3 Right of Assignee as a Member......................... 40
10.4 Withdrawal............................................ 40
10.5 Dissociation of a Member.............................. 40
ARTICLE 11 ADDITIONAL MEMBERS.................................................. 42
ARTICLE 12 DISSOLUTION AND TERMINATION......................................... 43
12.1 Dissolution........................................... 43
12.2 Winding Up, Liquidation and Distribution of Assets.... 43
12.3 Return of Contribution Nonrecourse to Other Members... 45
12.4 Filing of Certificate of Cancellation ................ 46
ARTICLE 13 MISCELLANEOUS PROVISIONS............................................ 46
13.1 Notices............................................... 46
13.2 Application of Delaware Law........................... 46
13.3 Waiver of Action for Partition........................ 46
13.4 Amendments............................................ 47
13.5 Execution of Additional Instruments................... 47
13.6 Construction.......................................... 47
iii
Syntroleum-Sweetwater Company Agreement
---------------------------------------------------------------------------
CONFIDENTIAL
13.7 Headings and Pronouns................................. 47
13.8 Waivers .............................................. 47
13.9 Rights and Remedies Cumulative........................ 47
13.10 Severability.......................................... 47
13.11 Successors and Assigns................................ 48
13.12 Creditors............................................. 48
13.13 Counterparts ......................................... 48
13.14 Investment Representations ........................... 48
13.15 Limitation on Damages ................................ 49
EXHIBIT A ....................................................................... 51
iv
Syntroleum-Sweetwater Company Agreement
-----------------------------------------------------------------------------
CONFIDENTIAL
FIRST AMENDED AND RESTATED COMPANY AGREEMENT
This First Amended and Restated Company Agreement (the "Company
Agreement") of Syntroleum/Sweetwater Company, L.L.C., a Delaware limited
liability company (the "Company"), is made and entered into effective as of
the 12th day of January, 1998 (the "Effective Date"), by and among Syntroleum
Corporation, an Oklahoma corporation ("Syntroleum"), SLH Corporation, a
Kansas corporation ("SLH"), Enron Capital & Trade Resources Corp., a Delaware
corporation ("ECT"), and such other Persons who shall be admitted as Members
of the Company as provided herein (each a "Member" and collectively the
"Members").
RECITALS
A. The Company is a Delaware limited liability company formed on October
6, 1997 under the Act.
B. The Company was formed to construct, start up, own and operate
the Plant and to sell the products produced at the Plant.
C. The original Members of the Company entered into the Original
Company Agreement effective May 6, 1997.
D. The Members desire to amend and restate the Original Company
Agreement for the purpose of setting forth in detail their amended and
restated agreement with respect to the ownership and operation of the Company.
In consideration of the mutual covenants and conditions hereinafter set
forth, the Members hereby agree that the terms of this Company Agreement
governing the Company shall be as follows from and after the Effective Date.
Syntroleum-Sweetwater Company Agreement
-----------------------------------------------------------------------------
CONFIDENTIAL
ARTICLE 1
DEFINITIONS
The following terms used in this Company Agreement shall have the
following meanings (unless otherwise expressly provided herein);
(a) "ACT" means the Delaware Limited Liability Company Act, Title 6,
Delaware Code, Sections 18-101 et seq., as it may be amended from time to
time, and any successor to such Act.
(b) "ADDITIONAL CLASS B MEMBER" means any Person admitted to
the Company as a Class B member pursuant to SECTION 8.3.
(c) "AFFILIATE" of a Person means (I) any other Person directly,
or indirectly through one or more intermediaries, controlling, controlled
by or under common control with such Person; (ii) any officer, director,
partner, employer, or direct or indirect beneficial owner of any 10% or
greater equity or voting interest of such Person; or (iii) any other
Person for which a Person described in clause (ii) acts in any such
capacity.
(d) "ANNUAL BUDGET" means the annual budget established by the
Manager and approved by the Operating Committee under SECTION 5.3(b).
(e) "AVAILABLE CASH" means the amount determined by the Manager
under the provisions of SECTION 9.3 to be available for distribution to
Members.
(f) "BANKRUPT MEMBER" means a Member who:
(i) has become the subject of an Order for Relief under the United
States Bankruptcy Code;
(ii) has initiated, either in an original proceeding or by way of
answer in any state insolvency or receivership proceeding, an action for
liquidation arrangement, composition, readjustment, dissolution, or
similar relief.
2
Syntroleum-Sweetwater Company Agreement
-----------------------------------------------------------------------------
CONFIDENTIAL
(g) "CAPITAL ACCOUNT" as of any given date means the Capital Account
of a Member or Economic Interest Owner established and maintained pursuant to
Article 8.
(h) "CAPITAL COMMITMENT" means the amount which a Member has agreed to
contribute to the capital of the Company under SECTION 8.1, 8.2, or 8.3.
(i) "CAPITAL CONTRIBUTION" means any contribution to the capital of the
Company in cash or property by a Member or Economic Interest Owner whenever
made.
(j) "CERTIFICATE OF FORMATION" means the Certificate of Formation of
the Company as filed with the Secretary of State of Delaware on May 6, 1997,
and as the same may be amended, amended and restated or otherwise modified
from time to time.
(k) "CLASS A MEMBER" means Syntroleum and any assignee of Syntroleum's
Membership Interest or Economic Interest and any Person otherwise admitted to
the Company as a Class A Member under the terms of this Agreement.
(l) "CLASS B MEMBER" means SLH, and any Person otherwise admitted to
the Company as a Class B Member under SECTIONS 8.2 and 8.3.
(m) "CODE" means the Internal Revenue Code of 1986 or corresponding
provisions of subsequent superseding federal revenue laws.
(n) "COMPANY" means Syntroleum/Sweetwater Company, L.L.C., a Delaware
limited liability company.
(o) "COMPANY AGREEMENT" means this Amended and Restated Company
Agreement as originally executed and as amended, amended or restated, or
otherwise modified from time to time.
(p) "CONTRACTOR" means a licensed U.S. engineering or construction
contractor designated by the Manager to perform the detailed design,
engineering, procurement and construction work for the Plant if and when such
work is not being performed by Syntroleum.
3
Syntroleum-Sweetwater Company Agreement
-----------------------------------------------------------------------------
CONFIDENTIAL
(q) "CONVERSION PROCESS" shall have the same meaning as given in the
License Agreement between the Company and Syntroleum.
(r) "DEFICIT CAPITAL ACCOUNT" means with respect to any Member or
Economic Interest Owner, the deficit balance, if any, in such Member's or
Economic Interest Owner's Capital Account as of the end of the taxable year,
after giving effect to the following adjustments:
(i) credit to such Capital Account any amount which such Member or
Economic Interest Owner is obligated to restore under Section
1.704-1(b)(2)(ii)(c) of the Treasury Regulations, as well as any
addition thereto pursuant to the next to last sentence of Sections
1.704-2(g)(1) and (i)(5) of the Treasury Regulations, after taking into
account thereunder any changes during such year in partnership minimum
gain (as determined in accordance with Section 1.704-2(d) of the
Treasury Regulations) and in the minimum gain attributable to any
partner nonrecourse debt (as determined under Section 1.704-2(i)(3) of
the Treasury Regulations); and
(ii) debit to such Capital Account the items described in Sections
1.704-1(b)(2)(ii)(d)(4), (5) and (6) of the Treasury Regulations.
This definition of Deficit Capital Account is intended to comply with the
provisions of Treasury Regulations Sections 1.704-1(b)(2)(ii)(d) and 1.704-2,
and will be interpreted consistently with those provisions.
(s) "DEPRECIATION" means, for each Fiscal Year, an amount equal to the
depreciation, amortization, or other cost recovery deduction allowable with
respect to an asset for such Fiscal Year, except that if the Gross Asset
Value of an asset differs from its adjusted basis for federal income tax
purposes at the beginning of such Fiscal Year, Depreciation shall be an
amount which bears the same ratio to such beginning Gross Asset Value as the
federal income tax depreciation, amortization, or other cost recovery
deduction for such Fiscal Year bears to such beginning adjusted tax basis;
provided, however, that if the adjusted basis for federal income tax purposes
of an asset at the beginning of such Fiscal Year is zero, Depreciation shall
be determined with reference to such beginning Gross Asset Value using any
reasonable method selected by the Manager.
4
Syntroleum-Sweetwater Company Agreement
-----------------------------------------------------------------------------
CONFIDENTIAL
(t) "ECONOMIC INTEREST" means a Member's or Economic Interest Owner's
share of one or more of the Company's Net Profits, Net Losses and
distributions of the Company's assets pursuant to this Company Agreement, but
shall not include any right to participate in the management or affairs of
the Company, including, the right to vote on, consent to or otherwise
participate in any decision of the Members or Managers.
(u) "ECONOMIC INTEREST OWNER" means the owner of an Economic Interest
who is not a Member.
(v) "EFFECTIVE DATE" means the date set forth in the first paragraph of
this Company Agreement.
(w) "ENTITY" means any general partnership, limited partnership,
limited liability company, limited liability partnership, corporation, joint
venture, trust, business trust, cooperative or association or any foreign
trust or foreign business organization.
(x) "EPC AGREEMENT" means the engineering, procurement and construction
agreement to be entered into between the Company and the Contractor for the
design, engineering and construction of the Plant.
(y) "FIRST CLOSING" means the date upon which Syntroleum, SLH and ECT
shall execute this Company Agreement and ECT shall be admitted to the Company
as a Class B Member pursuant to Section 8.2.
(z) "FISCAL YEAR" means the Company's fiscal year, which shall be the
calendar year.
(aa) "GIFTING MEMBER" means any Member who gifts, bequeaths or
otherwise transfers for no consideration (by operation of law or otherwise,
except with respect to bankruptcy) all or any part of its Membership Interest
or Economic Interest.
(bb) "GROSS ASSET VALUE" means, with respect to any asset, the asset's
adjusted basis for federal income tax purposes, except as follows:
5
Syntroleum-Sweetwater Company Agreement
-----------------------------------------------------------------------------
CONFIDENTIAL
(i) The initial Gross Asset Value of any asset contributed by a
Member or Economic Interest Owner to the Company shall be the gross
fair market value of such asset, as determined by the contributing
Member or Economic Interest Owner and the Manager, provided that the
initial Gross Asset Values of the assets contributed to the Company
pursuant to SECTION 8.1 hereof shall be as set forth therein, and
provided further that, if the contributing Member is a Manager, the
determination of the fair market value of any other contributed asset
shall require the consent of the other Members owning greater than 50%
of the Membership Interest (determined without regard to the Membership
Interest of such contributing Member);
(ii) The Gross Asset Values of all Company assets shall be
adjusted to equal their respective gross fair market values, as
determined by the Manager as of the following times: (a) the
acquisition of an additional interest by any new or existing Member or
Economic Interest Owner in exchange for more than a DE MINIMIS
contribution of property (including money); (b) the distribution by the
Company to a Member or Economic Interest Owner of more than a DE
MINIMIS amount of property as consideration for a Membership Interest
or Economic Interest; and (c) the liquidation of the Company within
the meaning of Regulations Section 1.704-1(b)(2)(ii)(g); provided,
however, that adjustments pursuant to clauses (a) and (b) above shall
be made only if the Manager reasonably determines that such adjustments
are necessary or appropriate to reflect the relative economic interests
of the Members or Economic Interest Owners in the Company;
(iii) The Gross Asset Value of any Company asset distributed to
any Member or Economic Interest Owner shall be adjusted to equal the
gross fair market value of such asset on the date of distribution as
determined by the distributee and the Manager, provided that, if the
distributee is a Manager, the determination of the fair market value of
the distributed asset shall require the consent of the other Members
owning greater than 50% of the Membership Interest (determined without
regard to the Membership Interest of the distributee Member); and
(iv) The Gross Asset Values of Company assets shall be increased
(or decreased) to reflect any adjustments to the adjusted basis of such
assets pursuant to Code Section 734(b) or Code Section 743(b), but only
to the extent that such
6
Syntroleum-Sweetwater Company Agreement
-----------------------------------------------------------------------------
CONFIDENTIAL
adjustments are taken into account in determining Capital Accounts
pursuant to Regulation Section 1.704-1(b)(2)(iv)(m) and SECTION 8.3 and
subparagraph (iv) under the definition of Net Profits and Net Losses;
provided, however, that Gross Asset Values shall not be adjusted
pursuant to this definition to the extent the Manager determines that
an adjustment pursuant to subparagraph (ii) of this definition is
necessary or appropriate in connection with a transaction that would
otherwise result in an adjustment pursuant to this subparagraph (iv).
If the Gross Asset Value of an asset has been determined or adjusted pursuant
to subparagraph (i), (ii) or (iv) of this definition, then such Gross Asset
Value shall thereafter be adjusted by the Depreciation taken into account
with respect to such asset for purposes of computing Net Profits and Net
Losses.
(cc) "LAND" means the land to be acquired by lease or purchase by the
Company or by contribution by a Member to the Company, upon which the Plant
is to be built, together with all buildings and improvements thereon,
including the Plant to be constructed thereon, and all appurtenant easements,
other appurtenances, and all fixtures and equipment required for the
operation thereof.
(dd) "LENDER" means one or more Persons from whom the Company borrows
money (including secured senior and subordinated borrowings) to design,
engineer, construct, start up and initially operate the Plant.
(ee) "LICENSE AGREEMENT" means the site license agreement between
Syntroleum and the Company dated as of the Effective Date pursuant to which
the Company has received or will receive a non-exclusive site license to
practice the Conversion Process at the Plant.
(ff) "LOAN" means one or more loans from one or more Lenders to the
Company (including secured senior and subordinated loans) in the aggregate
principal sum of up to that amount which is necessary, in the opinion of the
Manager, to design, engineer, construct, start up and initially operate the
Plant.
(gg) "MANAGER" means Syntroleum or any other Person or Persons that
succeed it in that capacity. References to the Manager in the singular or as
him, her, it, itself, or other like references shall also, where the context
so requires, be deemed to include the plural or
7
Syntroleum-Sweetwater Company Agreement
-----------------------------------------------------------------------------
CONFIDENTIAL
the masculine or feminine reference, as the case may be.
(hh) "MEMBER" means each Person who executes a counterpart of this
Company Agreement as a member (whether Class A or Class B) and each Person
who may hereafter become a member. To the extent a Manager has purchased
Membership Interests in the Company, such Manager will have all the rights of
a Member with respect to such Membership Interests, and the term "Member" as
used herein shall include a Manager to the extent such Manager has purchased
such Membership Interests in the Company. If a Person is a Member immediately
prior to the purchase or other acquisition by such Person of an Economic
Interest, such Person shall have all the rights of a Member with respect to
such purchased or otherwise acquired Membership Interest or Economic
Interest, as the case may be. Any reference to Members shall mean both Class
A Members and Class B Members, collectively.
(ii) "MEMBERSHIP INTEREST" means a Member's entire interest in the
Company including such Member's Economic Interest and any right to
participate in the management or affairs of the Company, including, the right
to vote on, consent to or otherwise participate in any decision of the
Members or Managers granted hereby or by the applicable provisions of the Act
and such other rights and privileges that the Member may enjoy by being a
Member. The percentage Membership Interest of each Member is as set forth on
EXHIBIT A.
(jj) "MEMBERSHIP INTEREST PURCHASE AGREEMENT" means the purchase
agreement between the Company and a Member pursuant to which such Member
acquires a Membership Interest in the Company and containing such terms and
conditions as may be agreed upon by the Company and such Member.
(kk) "NET PROFITS" and "NET LOSSES" means for each taxable year of the
Company an amount equal to the Company's net taxable income or loss for such
year as determined for federal income tax purposes (including separately
stated items) in accordance with the accounting method and rules used by the
Company and in accordance with Section 703 of the Code with the following
adjustments:
(i) Any items of income, gain, loss and deduction allocated to
Members pursuant to SECTION 9.2 shall not be taken into account in
computing Net Profits or Net Losses;
8
Syntroleum-Sweetwater Company Agreement
-----------------------------------------------------------------------------
CONFIDENTIAL
(ii) Any income of the Company that is exempt from federal
income tax and not otherwise taken into account in computing Net
Profits and Net Losses (pursuant to this definition) shall be added to
such taxable income or loss;
(iii) Any expenditure of the Company described in
Section 705(a)(2)(B) of the Code and not otherwise taken into account
in computing Net Profits and Net Losses (pursuant to this definition)
shall be subtracted from such taxable income or loss;
(iv) In the event the Gross Asset Value of any Company asset
is adjusted pursuant to clause (ii) or (iii) of the definition of Gross
Asset Value, the amount of such adjustment shall be taken into account
as gain or loss from the disposition of such asset for purposes of
computing Net Profits and Net Losses;
(v) Gain or loss resulting from any disposition of any Company
asset with respect to which gain or loss is recognized for federal
income tax purposes shall be computed with reference to the Gross Asset
Value of the asset disposed of, notwithstanding that the adjusted tax
basis of such asset differs from its Gross Asset Value;
(vi) In lieu of the depreciation, amortization and other cost
recovery deductions taken into account in computing such taxable income
or loss, there shall be taken into account Depreciation for such Fiscal
Year; and
(vii) To the extent an adjustment to the adjusted tax basis of
any Company asset pursuant to Section 734(b) of the Code or
Section 743(b) of the Code is required pursuant to
Section 1.704-1(b)(2)(iv)(m)(4) of the Treasury Regulations to be taken
into account in determining Capital Accounts as a result of a
distribution other than in liquidation of a Membership Interest or
Economic Interest, the amount of such adjustment shall be treated as an
item of gain (if the adjustment decreases the basis of the asset) from
the disposition of the asset and shall be taken into account for
purposes of computing Net Profits or Net Losses.
9
Syntroleum-Sweetwater Company Agreement
-----------------------------------------------------------------------------
CONFIDENTIAL
(ll) "OPERATING COMMITTEE" means the committee of Members created
pursuant to Section 5.5.
(mm) "ORIGINAL COMPANY AGREEMENT" means the Operating Agreement of
the Company as originally executed effective May 6, 1997.
(nn) "PAYOUT" means cash distributions to a Member in an amount
equal to such Member's aggregate Capital Contributions plus a simple
annual return of 30%.
(oo) "PERSON" means any individual or Entity, and the heirs,
executors, administrators, legal representatives, successors, and
assigns of such Person where the context so permits.
(pp) "PLANT" means the commercial facility to be designed and
constructed by the Company with the use of the proceeds from Capital
Contributions and Loan to practice the Conversion Process under the
License Agreement.
(qq) "REPUBLIC" means Republic Financial Corporation.
(rr) "RESERVES" means, with respect to any fiscal period, funds
set aside or amounts allocated during such period to reserves which
shall be maintained in amounts deemed sufficient by the Manager for
working capital and to pay taxes, insurance, debt service, obligations,
losses or other costs or expenses incident to the ownership or
operation of the Company's business.
(ss) "SECOND CLOSING" means the date upon which the Class B
Members are required to pay the remaining balance of their Capital
Commitments and Additional Class B members, if any, are admitted to the
Company, all as provided in SECTION 8.3.
(tt) "SELLING MEMBER" means any Member or Economic Interest Owner
which sells, assigns, or otherwise transfers for consideration all or
any portion of its Membership Interest or Economic Interest.
(uu) "TRANSFERRING MEMBER" collectively means a Selling Member and
a Gifting Member.
10
Syntroleum-Sweetwater Company Agreement
-----------------------------------------------------------------------------
CONFIDENTIAL
(vv) "TREASURY REGULATIONS" means proposed, temporary and final
regulations promulgated under the Code in effect from time to time and the
corresponding sections of any regulations subsequently issued that amend or
supersede such regulations.
(ww) "UNITS" means the units of Membership Interest (either Class A or
Class B) issued to Members hereunder.
ARTICLE 2
FORMATION OF COMPANY
2.1 FORMATION. On May 6, 1997, the Company was organized by
executing and filing the original Certificate of Formation with the
Delaware Secretary of State in accordance with and pursuant to the Act.
2.2 NAME. The name of the Company is Syntroleum/Sweetwater
Company, L.L.C.
2.3 PRINCIPAL PLACE OF BUSINESS. The principal place of business
of the Company shall be 000 Xxxxx Xxxxxx, Xxxxx 0000, Xxxxx, Xxxxxxxx
00000-0000. The Company may locate its places of business and
registered office at any other place or places as the Manager may from
time to time deem advisable.
2.4 REGISTERED OFFICE AND REGISTERED AGENT. The Company's
registered office shall be at the office of its registered agent at
0000 Xxxxxx Xxxxxx, Xxxx xx Xxxxxxxxxx, Xxxxxx of New Castle, Delaware,
and the name of its registered agent at such address shall be The
Corporation Trust Company. The registered office and registered agent
may be changed from time to time by filing the address of the new
registered office and/or the name of the new registered agent with the
Delaware Secretary of State pursuant to the Act.
2.5 TERM. The term of the Company shall be perpetual, unless the
Company is earlier dissolved in accordance with either the provisions
of this Company Agreement or the applicable provisions of the Act.
11
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
ARTICLE 3
BUSINESS OF COMPANY
The business of the Company shall be to design, engineer, construct
(or cause to be designed, engineered and constructed), start up, own and
operate the Plant and market all products produced at the Plant. Without
limiting the foregoing, the Company shall have and exercise all other powers
necessary to or reasonably connected with the Company's business which may
be legally exercised by limited liability companies under the Act, and may
engage in all activities necessary, customary, convenient, or incident to any
of the foregoing.
ARTICLE 4
NAMES AND ADDRESSES OF MEMBERS
The names and addresses of the Members are as follows:
NAME ADDRESS
Syntroleum Corporation, an 0000 Xxxxx Xxxxxxx, Xxxxx 0000
Xxxxxxxx corporation Xxxxx, Xxxxxxxx 00000
SLH Corporation, a 0000 Xxxx 00xx Xxxxxx, Xxxxx 000
Xxxxxx corporation Shawnee Xxxxxxx, Xxxxxx 00000
Enron Capital & Trade Resources Corp., P.O. Box 4428
a Delaware corporation Xxxxxxx, Xxxxx 00000-0000
ARTICLE 5
RIGHTS AND DUTIES OF MANAGER
5.1 MANAGEMENT. The business and affairs of the Company shall be
managed by Syntroleum which is hereby appointed as the Manager. Except when
approval of the Members or approval of the Operating Committee under SECTION
5.5 is expressly required by this Company Agreement, the Manager shall have
full and complete authority, power and discretion to manage and control the
business, affairs and properties of the Company, to make all decisions
regarding those matters and to perform any and all other acts or activities
customary or incident to the management of the Company's business.
12
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
5.2 NUMBER, TENURE AND QUALIFICATIONS. The Company shall initially have
one Manager. The number of Managers of the Company shall be one unless a
different number is fixed from time to time by the affirmative vote of all
Members, but in no instance shall there be less than one Manager. The Manager
shall hold office until it is removed pursuant to SECTION 5.12. Any successor
Manager shall be appointed by the affirmative vote of all Members. Managers
need not be residents of the State of Delaware or Members of the Company.
5.3 CERTAIN POWERS OF MANAGER. Without limiting the generality of
SECTION 5.1, subject to the provisions of SECTION 5.5 below, the Managers
shall have power and authority, on behalf of the Company:
(a) to negotiate and enter into the License Agreement;
(b) to acquire by lease or purchase the Land for the construction
of the Plant;
(c) to negotiate and enter into the EPC Agreement with the
Contractor and such other agreements necessary for the design,
engineering, construction start up and operation of the Plant;
(d) to negotiate the terms of one or more Loans and to borrow funds
from one or more Lenders for the design, engineering, construction,
start-up, and initial operation of the Plant;
(e) to design, engineer, construct (or cause to be designed,
engineered and constructed), start up, own and operate the Plant;
(f) to borrow money for the Company from banks, other lending
institutions, on such terms as the Manager deems appropriate, and in
connection therewith, to hypothecate, encumber and grant security
interests in the assets of the Company to secure repayment of the
borrowed sums. No debt shall be contracted or liability incurred by or on
behalf of the Company except by the Manager, or by agents or employees of
the Company expressly authorized to contract such debt or incur such
liability by the Manager;
13
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
(g) to purchase property, casualty, liability and other insurance
to protect the Company's property and business;
(h) to hold and own any Company real and personal properties in
the name of the Company;
(i) to invest any Company funds temporarily (by way of example but
not limitation) in time deposits, short-term governmental obligations,
commercial paper or other investments;
(j) to execute on behalf of the Company all instruments and
documents, including, without limitation: checks; drafts; notes and other
negotiable instruments; mortgages or deeds of trust; security agreements;
financing statements; documents providing for the acquisition, mortgage
or disposition of the Company's real and personal property; assignments;
bills of sale; leases; partnership agreements; operating agreements of
other limited liability companies; and any other instruments or documents
necessary, or appropriate, in the opinion of the Manager, to the business
of the Company;
(k) to employ accountants, legal counsel, agents or other experts
or professionals to perform services for the Company and to compensate
them from Company funds; and
(l) to do and perform all other acts as may be necessary or
appropriate to the conduct of the Company's business.
5.4 POWERS OF OTHERS. Unless authorized to do so by this Company
Agreement or by the Manager, no attorney-in-fact, employee or other agent of
the Company shall have any power or authority to bind the Company in any way,
to pledge its credit or to render it liable pecuniary for any purpose. No
Member shall have any power or authority to bind the Company unless the
Member has been authorized by the Manager to act as an agent of the Company
in accordance with the previous sentence.
14
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
5.5 OPERATING COMMITTEE.
(a) The Company shall at all times have a committee of Members (the
"Operating Committee") consisting of one representative from each Member.
(b) The Committee shall have the responsibility to:
(i) develop and approve annual budgets (in each instance, the
"Annual Budget") for the Company, which approval shall require the
affirmative vote of 51% of the Membership Interest represented by the
Members of the Operating Committee, which vote must include the
affirmative vote of at least two members of the Operating Committee;
(ii) approve the design and engineering of the Plant;
(iii) approve the EPC Agreement;
(iv) ratify the appointment of, and approve, outside auditors,
attorneys and engineering firms for the Company;
(v) monitor the performance of the Manager;
(vi) meet at least once each year review the status of the
Company;
(vii) oversee the affairs of the Company upon liquidation or
dissolution pursuant to ARTICLE 12; and
(viii) perform such other tasks or duties as are
specifically set forth in this Agreement and all activities
necessary to, in connection with or incidental to any of the
foregoing.
(c) Each member of the Operating Committee shall be
required to undertake to perform such duties and only such duties
as are set forth in this SECTION 5.5 and, without limiting the
generality of the foregoing, no member of the Operating Committee
shall be expected or required to present, disclose to or
otherwise advise the Company of any investment or other business
opportunity which comes to the attention of such member.
15
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
(d) The members of the Operating Committee shall not
be liable with respect to any action taken or omitted to be taken
by such members in good faith in accordance with the direction,
approval or consent of the requisite percentage in interest of
the Members set forth in this Agreement with respect to any
action which may be directed, approved, or consented to by the
Members.
(e) The members of the Operating Committee may rely, and
shall be protected in acting, or refraining from acting in good faith
on any information, opinions, certificates, reports or statements,
including financial statements and financial data, prepared or
presented by (I) the officers or employees of the Manager, or (ii)
counsel, public accountants, engineers or other personnel as to matters
within such person's professional or expert competence.
(f) The members of the Operating Committee may consult with
counsel, and any advice or opinion of such counsel shall be full and
complete authorization and protection in respect of any action taken or
omitted in good faith in accordance with such advice or opinion Fees
and disbursements of any such counsel shall be paid by the Company.
(g) No member of the Operating Committee shall be liable for any
action taken or omitted in good faith, unless the member is judicially
determined to have been guilty of gross negligence, willful misconduct,
fraud or breach of this Company Agreement. In the absence of gross
negligence, bad faith, willful misconduct, a willful breach of the
Company Agreement on the part of the member, the Company shall, to the
fullest extent permitted by law, indemnify and hold harmless each such
member of the Operating Committee (and their respective heirs and legal
and personal representatives) from and against any and all claims,
liabilities, damages, losses, costs and expenses (including amounts
paid in satisfaction of judgments, in compromises and settlements, as
fines and penalties and legal or other costs and reasonable expenses of
investigation or defending against any claim or alleged claim) of any
nature whatsoever, known or unknown, liquidated or unliquidated, that
are incurred by any such member and arise out of or in connection with
serving on the Operating Committee; PROVIDED, that a member of the
Operating Committee shall not be entitled to indemnification with
respect to economic losses incurred by such person as a result of its
owning an interest in the Company and, PROVIDED FURTHER, that nothing
in this Agreement shall constitute a waiver or limitation of any rights
which a Member or the Company may have under applicable law and which
may not be waived. The termination of any
16
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
proceeding by settlement, judgment, order, conviction, or upon a plea
of NOLO CONTENDERE or its equivalent, shall not, or by itself, create a
presumption that such member's conduct constituted fraud, bad faith,
willful misconduct, gross negligence or a violation of applicable laws
or willful breach of this Company Agreement. The satisfaction of any
indemnification and any holding harmless pursuant to this Section
5.5(g) shall be from and limited to Company assets, and no Member shall
have any personal liability on account thereof; PROVIDED FURTHER, that
any Person entitled to indemnification from the Company hereunder shall
obtain the written consent of the Manager (which consent shall not be
unreasonably withheld) prior to entering into any compromise or
settlement which would result in an obligation of the Company to
indemnify such Person.
(h) CONFIDENTIALITY. Each member of the Operating Committee
shall keep confidential all matters involving (i) the Company and (ii)
any other member of the Operating Committee, until such time as there
shall have been general public disclosure of such matters or unless
such matters have become matters of public record or common knowledge.
(i) VOTES OF THE OPERATING COMMITTEE. The Operating Committee
shall act by the affirmative vote of at least 51% of the aggregate
Membership Interest represented by the members of the Operating
Committee except as otherwise specified. A majority of the Membership
Interest represented by the members of the Operating Committee shall
constitute a quorum. With respect to any vote taken by the Operating
Committee during a period in which the Company is not operating in a
manner so that it is meeting the Annual Budget for that period, the
approval of any such matter shall require a majority vote of the
Membership Interest represented on the Operating Committee which vote
must include the affirmative vote of at least two members of the
Operating Committee.
(j) Meetings of the Operating Committee shall be held no
fewer than four times per year at any place within the United States
and within or without the State of Delaware. The time and place for
holding meetings of the Operating Committee shall be fixed by the
Operating Committee.
(k) Regular meetings of the Operating Committee may be held
without notice if the time and place of the meetings are fixed by the
Operating Committee. Special meetings shall be held upon two days'
notice to members. Notice of a meeting need not be given to any
Operating Committee member who submits a signed waiver of notice
whether before or
17
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
after the meeting, or who attends the meeting without protesting, prior
thereto or at its commencement, the lack of notice to him. A notice or
waiver of notice need not specify the purpose of any regular or special
meeting.
(l) Members of the Operating Committee may participate in a
meeting by means of conference telephone or other similar
communications equipment which enable all persons participating in the
meeting to hear each other, and participation in a meeting by such
means shall constitute present at such meeting.
5.6 LIMITATIONS ON AUTHORITY. Notwithstanding any other provision of
this Company Agreement, the Manager shall not cause the Company to do any of
the following without the express written consent of all Members:
(a) sell or otherwise dispose of all or substantially all of the
Company's assets, or merge, consolidate, acquire or combine with another
Entity;
(b) mortgage, pledge, or grant a security interest in any property
of the Company, other than in connection with a Loan;
(c) lend money to or guaranty or become a surety for the obligations
of any Person;
(d) borrow any amounts in excess of the Loan or the amount set forth
in the Annual Budget;
(e) expend any amounts in excess of the amounts set forth in the
Annual Budget;
(f) confess any judgment against the Company, file any petition
for bankruptcy or make any assignment for the benefit of creditors in
any bankruptcy, insolvency, receivership or similar proceedings;
(g) change the character of the business of the Company as
described in ARTICLE 3 of this Company Agreement; or
18
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
(h) make any material modification, change or amendment to any
agreement or arrangement which is the subject of the matters referred
to in subclauses (a) through (g) above.
5.7 LIABILITY FOR CERTAIN ACTS. The Manager does not, in any way,
guarantee the return of the Members' or Economic Interest Owners' Capital
Contributions or a profit for the Members or Economic Interest Owners from
the operations of the Company. The Manager shall not be liable to the Company
or to any Member or Economic Interest Owner for any loss or damage sustained
by the Company or any Member or Economic Interest Owner, unless the loss or
damage shall have been the result of fraud, deceit, gross negligence, willful
misconduct, intentional breach of this Company Agreement or a wrongful taking
by the Manager.
5.8 MANAGERS AND MEMBERS HAVE NO EXCLUSIVE DUTY TO COMPANY. The
Manager shall not be required to manage the Company as its sole and exclusive
function and it (and any Member) may have other business interests and may
engage in other activities in addition to those relating to the Company.
Neither the Company nor any Member or Economic Interest Owner shall have any
right, by virtue of this Company Agreement, to share or participate in such
other activities of the Manager and/or Member or Economic Interest Owner or
to the income or proceeds derived therefrom. Neither the Manager nor any
Member or Economic Interest Owner shall incur any liability to the Company or
to any of the other Members or Economic Interest Owner as a result of
engaging in any other business or venture.
5.9 BANK ACCOUNTS. The Manager may from time to time open bank
accounts in the name of the Company, and the Manager shall be the sole
signatory thereon.
5.10 INDEMNIFICATION. Notwithstanding any other provision of this
Company Agreement, no Manager shall be liable to any Member or Economic
Interest Owner or the Company with respect to any act performed or neglected
to be performed in good faith and in a manner which such Manager believed to
be necessary or appropriate in connection with the ordinary and proper
conduct of the Company's business or the preservation of its property, and
consistent with the provisions of this Agreement. The Company shall indemnify
the Manager for, and hold it harmless from, any liability, whether civil or
criminal, and any loss, damage, or expense, including reasonable attorneys'
fees, incurred in connection with the ordinary and proper conduct of the
Company's business and the preservation of its business and property, or by
reason of the fact that such Person is or was a Manager, provided the Manager
to be indemnified acted in good faith and in a manner
19
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
such Manager believed to be consistent with the provisions of this Agreement;
and provided further that with respect to any criminal action or proceeding,
the Manager to be indemnified had no reasonable cause to believe the conduct
was unlawful. In connection with any claim of indemnification under this
SECTION 5.10, the Company shall make advances for expenses to the maximum
extent permitted by the Act provided that such expenses shall be refunded to
the Company if it is ultimately determined by a court of competent
jurisdiction that the Manager was not entitled to indemnification under this
Section 5.10. The termination of any action, suit or proceeding by judgment,
order, settlement, conviction, or upon a plea of NOLO CONTENDERE or its
equivalent shall not of itself create a presumption that indemnification is
not available under this SECTION 5.10. The obligation of the Company to
indemnify any Manager under this SECTION 5.10 shall be satisfied out of
Company assets only, and if the assets of the Company are insufficient to
satisfy its obligation to indemnify any Manager, such Manager shall not be
entitled to contribution from any Member.
5.11 RESIGNATION. The Manager of the Company may resign at any time by
giving not less than sixty (60) days written notice to each of the Members of
the Company. The resignation of any Manager shall take effect sixty (60) days
after delivery of notice thereof or at such later time as shall be specified
in such notice; and, unless otherwise specified therein, the acceptance of
such resignation shall not be necessary to make it effective. The resignation
of a Manager who is also a Member or Economic Interest Owner shall not affect
the Manager's rights as a Member or Economic Interest Owner and shall not
constitute a withdrawal of a Member or Economic Interest Owner.
5.12 REMOVAL. At a meeting called expressly for that purpose, the
Manager may be removed at any time, with or without cause, by the affirmative
vote of all of the Members. The removal of a Manager who is also a Member
shall not affect the Manager's rights as a Member and shall not constitute a
withdrawal of a Member.
5.13 VACANCIES. Any vacancy occurring for any reason in the position
of Manager shall be filled by the affirmative vote of all Members.
20
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
5.14 COMPENSATION, REIMBURSEMENT, ORGANIZATION EXPENSES
(a) Other than as set forth in this SECTION 5.14,
neither the Manager nor any Member shall be entitled to
compensation from the Company for services rendered to the
Company.
(b) The Manager shall be reimbursed by the
Company for all direct expenses of the Manager related to the
business of the Company, expenses incurred by the Manager
on behalf of the Company or at the Company's request plus an
allocable portion of the Manager's total overhead not to
exceed an amount of $500,000 per year.
(c) The Manager shall cause the Company to
make an appropriate election to treat the expenses
incurred by the Company in connection with the formation and
organization of the Company to be amortized over the 60-month
period beginning with the month in which the Company begins
business to the extent that such expenses constitute
"organizational expenses" of the Company within the meaning
of Code Section 709(b)(2).
5.15 RIGHT TO RELY ON THE MANAGER. Any Person dealing with the
Company may rely (without duty of further inquiry) upon a certificate signed
by the Manager as to:
(a) the identity of any Manager, Member or
Economic Interest Owner;
(b) the existence or nonexistence of any
fact or facts which constitute a condition precedent to
acts on behalf of the Company by any Manager or which are in
any other manner germane to the affairs of the Company;
(c) the Persons who are authorized to execute
and deliver any instrument or document of the Company; or
(d) any act or failure to act by the Company or
any other matter whatsoever involving the Company or any
Member or Economic Interest Owner.
21
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
ARTICLE 6
RIGHTS AND OBLIGATIONS OF MEMBERS
6.1 LIMITATION OF LIABILITY. Each Member's or Economic
Interest Owner's liability shall be limited as set forth in this Company
Agreement, the Act and other applicable law.
6.2 COMPANY DEBT LIABILITY. Anything herein to the contrary
notwithstanding, except as otherwise expressly agreed in writing, a Member
or Economic Interest Owner will not be personally liable for any debts,
liabilities or losses of the Company, whether to the Company, another
Member or to creditors of the Company, beyond its respective Capital
Contributions and any obligation of the Member or Economic Interest Owner
under ARTICLE 8 to make Capital Contributions, or as otherwise required by
law. The Manager shall not have the right, absent the written consent of a
Member, to obligate such Member to guarantee any obligation of the Company.
6.3 COMPANY BOOKS. In accordance with SECTION 9.9, the
Manager shall maintain and preserve, during the existence of the Company,
all accounts, books, and other relevant Company documents. Upon
reasonable request, and for a proper company purpose, each Member shall
have the right, during ordinary business hours, to inspect and copy such
Company documents at the requesting Member's expense.
6.4 PRIORITY AND RETURN OF CAPITAL. Except as may be
expressly provided in ARTICLE 9, no Member or Economic Interest Owner
shall have priority over any other Member or Economic Interest Owner,
either as to the return of Capital Contributions or as to Net Profits, Net
Losses or distributions; provided that this SECTION 6.4 shall not apply to
loans (as distinguished from Capital Contributions) which a Member or
Economic Interest Owner has made to the Company.
6.5 DEALING WITH MEMBERS. The fact that a Member, an
Affiliate of a Member or any employee, consultant or agent of a Member,
is, or is directly or indirectly interested in or connected with any Person
that is, employed by the Company to render or perform a service, or from
or to whom the Company may buy or sell any property or have other business
dealings, shall not prohibit the Company from employing such Member,
Affiliate or other Person or from dealing with him, her or it and neither
the Company nor any of the other Members shall have any rights in or to any
income or profits derived therefrom by such other Person.
22
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
ARTICLE 7
MEETINGS OF MEMBERS
7.1 ANNUAL MEETING. The annual meeting of the Members shall be
held on the third Tuesday in March or at such other time as shall be
determined by resolution of the Members, commencing with the year 1998, for
the purpose of the transaction of such business as may come before the
meeting.
7.2 SPECIAL MEETINGS. Special meetings of the Members, for any
purpose or purposes, may be called by the Manager or by any Member holding at
least 10% of the Company's aggregate Membership Interest.
7.3 PLACE OF MEETINGS. The Manager may designate any place as
the location for any meeting of the Members. If no designation is made, the
place of meeting shall be the principal executive office of the Company.
7.4 NOTICE OF MEETINGS. Except as provided in SECTION 7.5,
written notice stating the place, day and hour of the meeting and the purpose
or purposes for which the meeting is called shall be delivered not less than
three nor more than thirty (30) days before the date of the meeting, either
personally or by mail, by or at the direction of the Manager or the Member or
Members calling the meeting, to each Member entitled to vote at such meeting.
7.5 MEETING OF ALL MEMBERS. If all of the Members shall meet
at any time and place, and consent to the holding of a meeting at such time
and place, such meeting shall be valid without call or notice, and at such
meeting lawful action may be taken by the Members.
7.6 RECORD DATE. For the purpose of determining Members
entitled to notice of or to vote at any meeting of Members or any adjournment
thereof, or Members entitled to receive payment of any distribution, or in
order to make a determination of Members for any other purpose, the date on
which notice of the meeting is mailed or the date on which the resolution
declaring such distribution is adopted, as the case may be, shall be the
record date for such determination of Members. When a determination of
Members entitled to vote at any meeting of Members has been made as provided
in this SECTION 7.6, such determination shall apply to any adjournment of
such meeting.
23
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
7.7 QUORUM. Members holding an aggregate of more than 50% of
the total Membership Interest held by all Members, represented in person or
by proxy, shall constitute a quorum at any meeting of Members. In the absence
of a quorum at any such meeting, a majority of the Membership Interests so
represented may adjourn the meeting from time to time for a period not to
exceed 60 days without further notice. However, if the adjournment is for
more than 60 days, or if after the adjournment a new record date is fixed for
the adjourned meeting, a notice of the adjourned meeting shall be given to
each Member of record entitled to vote at the meeting. At such adjourned
meeting at which a quorum shall be present or represented, any business may
be transacted which might have been transacted at the meeting as originally
noticed. The Members present at a duly organized meeting may continue to
transact business until adjournment, notwithstanding the withdrawal during
such meeting of that number of Membership Interests whose absence would cause
less than a quorum.
7.8 MANNER OF ACTING. The affirmative vote of Members holding
an aggregate of more than 50% of the total Membership Interest held by all
Members shall be the act of the Members. Unless otherwise expressly provided
herein or required under applicable law, Members who have an interest
(economic or otherwise) in the outcome of any particular matter upon which
the Members vote or consent may vote or consent upon any such matter and
their Membership Interest, vote or consent, as the case may be, shall be
counted in the determination of whether the requisite matter was approved by
the Members.
7.9 PROXIES. At all meetings of Members a Member may vote in
person or by proxy executed in writing by the Member or by a duly authorized
attorney-in-fact. Such proxy shall be filed with the Manager of the Company
before or at the time of the meeting. No proxy shall be valid after eleven
months from the date of its execution, unless otherwise provided in the proxy.
7.10 ACTION BY MEMBERS WITHOUT A MEETING. Action required or
permitted to be taken at a meeting of Members may be taken without a meeting
if the action is evidenced by one or more written consents or approvals
describing the action taken and signed by Members holding sufficient
Membership Interests to approve such action had such action been properly
voted on at a duly called meeting of the Members. Action taken under this
SECTION 7.10 is effective when Members with the requisite Membership
Interests have signed the consent or approval, unless the consent specifies a
different effective date. The record date for determining Members entitled to
take action without a meeting shall be the date the first Member signs a
written consent. The Manager shall
24
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
provide prompt notice to all Members of the taking of any action by written
consent under this SECTION 7.10.
7.11 WAIVER OF NOTICE. When any notice is required to be given
to any Member, a waiver thereof in writing signed by the Person entitled to
such notice, whether before, at, or after the time stated therein, shall be
equivalent to the giving of such notice.
ARTICLE 8
CAPITAL CONTRIBUTIONS AND CAPITAL ACCOUNTS
8.1 INITIAL CONTRIBUTIONS.
(a) Upon execution of the Original Company
Agreement, Syntroleum was issued 98.95 Units of Class A
Membership Interest in consideration for a Capital
Contribution to the Company consisting of the granting, at the
First Closing, of the non-exclusive license to the Conversion
Process as set forth in the License Agreement, which Units
represented 98.95% of the aggregate Membership Interest prior
to the First Closing, and became the sole Class A Member until
additional Class A Members are admitted pursuant to SECTION 8.4.
(b) Upon execution of the Original Company
Agreement, SLH was issued 1.05 Units of Class B Membership
Interest in consideration for a Capital Contribution to the
Company of $1,500,000, which Units represented 1.05% of the
aggregate Membership Interest prior to the First Closing, and
became the sole Class B Member until Additional Class B
Members are admitted pursuant to Sections 8.2 and 8.3. SLH
shall not be required to make any further Capital
Contributions.
8.2 FIRST CLOSING; ECT ADMISSION AS CLASS B MEMBER.
(a) At the First Closing:
(i) Syntroleum shall make an additional Capital
Contribution in the amount of $500,000 for no additional
Membership Interest and Syntroleum's Units of Membership
Interest shall be adjusted downward from 98.95 Units of Class
A Membership Interest to 90.0 Units of Class A Membership
Interest. Syntroleum shall not be required to make any further
Capital Contributions; and
25
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
(ii) ECT shall make a Capital Commitment in
the amount of $15,450,000, of which $1,000,000 shall be
contributed in cash or other immediately available funds as a
Capital Contribution for four Units of Class B Membership
Interest, which Units represent four percent (4%) of the
aggregate Membership Interest in the Company.
(iii) SLH shall be issued, at no expense, an
additional 4.95 Units of Class B Membership Interest which
Units, together with the Units issued to SLH upon becoming a
Member pursuant to the Original Company Agreement, represent
six percent (6%) of the aggregate Membership Interest in the
Company.
(b) The First Closing shall occur at such time
and place designated by the Manager and shall occur upon the
execution by Syntroleum and ECT of a Membership Interest
Purchase Agreement providing for the Capital Contributions
described in SECTION 8.2(a) and the execution by Syntroleum,
ECT and SLH of this Company Agreement.
(c) Syntroleum, ECT and SLH consent to the
admission of up to two additional Class B Members as described
in SECTION 8.3 at the Second Closing, provided, that any
amendments to this Company Agreement proposed by any
additional Member (whether such Member is an additional Class
A Member or an Additional Class B Member) shall require the
unanimous approval of Members in accordance with SECTION 13.4
of this Company Agreement.
(d) A description of the Members' Capital
Contributions to, and relative Membership Interest in, the
Company following the First Closing is attached to this
Company Agreement as EXHIBIT A.
8.3 SECOND CLOSING; PAYMENT OF CAPITAL COMMITMENTS OF
CLASS B MEMBERS.
(a) At the Second Closing (i) upon the terms and
conditions of this Company Agreement and the terms and
conditions of the Purchase Agreement between ECT and the
Company, the Company will issue to ECT, in consideration for a
Capital Contribution of $14,450,000, that number of additional
Units of Class B Membership Interest equal to 7% of the
aggregate Membership Interest, and (ii) upon the terms and
conditions of this Company Agreement and the terms and
conditions of the Purchase Agreement between any
26
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
Additional Class B Members and the Company, the Company will
issue to not more than two Additional Class B Members, in
consideration for a Capital Contribution of $15,450,000 to be
made by each such Additional Class B Member in the manner set
forth in this SECTION 8.3, that number of Units of Class B
Membership Interest equal 11% of the Company's aggregate
Membership Interest for each such Additional Class B Member.
The exact number of Additional Class B Members (up to two) to
be admitted shall be at the absolute discretion of the Manager
based upon the capital needs of the Company. In the event of
the admission of Additional Class B Members or additional
Capital Contributions by existing Class B Members, SLH shall
be issued, at no cost to SLH, such number of additional Units
of Class B Membership Interest as will be necessary to
maintain SLH's 1.07% aggregate Membership Interest in the
Company and Syntroleum's relative Membership Interest in the
Company shall be proportionately reduced.
(b) The Second Closing shall occur on a date
and at a place determined by the Manager as soon as practical
after satisfaction by the Company of the conditions to the
Second Closing set forth in the Membership Interest Purchase
Agreements between the Company and ECT dated as of the
Effective Date and the Membership Interest Purchase
Agreements between the Company and the Additional Class B
Members dated as of the date of the Second Closing.
(c) At the Second Closing, ECT shall make a
Capital Contribution to the Company by wire transfer or other
certified funds in the amount of $14,450,000 which sum
represents the remaining balance of the Capital Commitment of
ECT and each Additional Class B Member shall make a Capital
Contribution to the Company (by wire transfer or other
certified funds with respect to the cash portion of such
Capital Contribution) in the amount of $15,450,000.
(d) In the event that ECT fails to make its
required Capital Contribution of $14,450,000 at the Second
Closing, Syntroleum shall have the option to purchase ECT's
Membership Interest in the Company for a purchase price equal
to the Capital Contributions made by ECT up to the date of
the Second Closing. Should Syntroleum elect to exercise the
option granted in this SECTION 8.3(d), Syntroleum shall give
ECT written notice of its election and closing of Syntroleum's
purchase shall take place at the Second Closing.
27
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
8.4 ADDITIONAL CLASS A MEMBERS.
(a) The Company may admit an additional Class A
Member, in the discretion of the Manager, in exchange for a
contribution by such proposed new Class A Member of the Land
for the Plant, all on terms acceptable to Syntroleum. Upon the
issuance of Units to an additional Class A Member under this
SECTION 8.4(a), the Company shall issue, for no additional
consideration, additional Units of Class B Membership
Interests to each Class B Member sufficient to maintain each
Class B Member's relative percentage ownership of the total
Membership Interest of all the Members. All parties, by the
execution of this Company Agreement, consent to the admission
of an additional Class A Member under this SECTION 8.4(a)
without any further action on their part, provided, however,
that any amendments to this Company Agreement proposed by any
additional Member (whether such Member is an additional Class
A Member or an additional Class B Member) shall require the
unanimous approval of Members in accordance with SECTION 13.4
of this Company Agreement.
(b) The Company may admit Republic as an
additional Class A Member pursuant to the terms of that
certain agreement dated March 4, 1997 between the Company and
Republic and by which Republic has agreed to provide services
to the Company in connection with obtaining debt financing for
the Plant (the "Republic Agreement"). Under the terms of the
Republic Agreement, the Company may be required to issue Units
to Republic under certain circumstances. In such event, the
Company shall also issue additional Units of Class B
Membership Interests to all Class B Members sufficient to
maintain each Class B Member's relative percentage ownership
of the total Membership Interest of all the Members. All
parties, by their execution of this Company Agreement, hereby
consent to the admission of Republic if and when such event
occurs, without any further action on their part, provided,
however, that any amendments to this Company Agreement
proposed by any additional Member (whether such Member is an
additional Class A Member or an additional Class B Member)
shall require the unanimous approval of Members in accordance
with SECTION 13.4 of this Company Agreement.
8.5 CAPITAL ACCOUNTS.
(a) A separate Capital Account will be
maintained for each Member or Economic Interest Owner. Each
Member's or Economic Interest Owner's Capital Account
28
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
will be increased by (1) the amount of money contributed by
such Member or Economic Interest Owner to the Company; (2) the
fair market value of property contributed by such Member or
Economic Interest Owner to the Company (net of liabilities
secured by such contributed property that the Company is
considered to assume or take subject to under Section 752 of
the Code); (3) allocations to such Member or Economic Interest
Owner of Net Profits; (4) any items in the nature of income
and gain which are specially allocated to the Member pursuant
to paragraphs (a), (b), (c), (d), (e), (i) and/or (j) of
SECTION 9.2; and (5) allocations to such Member or Economic
Interest Owner of income described in Section 705(a)(1)(B) of
the Code. Each Member's or Economic Interest Owner's Capital
Account will be decreased by (1) the amount of money
distributed to such Member or Economic Interest Owner by the
Company; (2) the fair market value of property distributed to
such Member or Economic Interest Owner by the Company (net of
liabilities secured by such distributed property that such
Member or Economic Interest Owner is considered to assume or
take subject to under Section 752 of the Code);
(3) allocations to such Member or Economic Interest Owner of
expenditures described in Section 705(a)(2)(B) of the Code;
(4) any items in the nature of deduction and loss that are
specially allocated to the Member or Economic Interest Owner
pursuant to paragraphs (a), (b), (c), (d), (e), (i) and/or (j)
of SECTION 9.2; (5) any decrease in the relative Capital
Accounts of the Members or Economic Interest Owners under
SECTION 13.2; and (6) allocations to the account of such
Member or Economic Interest Owner of Net Losses.
(b) In the event of a permitted sale or exchange
of a Membership Interest or Economic Interest in the Company,
the Capital Account of the transferor shall become the Capital
Account of the transferee to the extent it relates to the
transferred Membership Interest or Economic Interest in
accordance with Section 1.704-1(b)(2)(iv) of the Treasury
Regulations.
(c) The manner in which Capital Accounts are to
be maintained pursuant to this SECTION 8.5 is intended to
comply with the requirements of Section 704(b) of the Code and
the Treasury Regulations promulgated thereunder. If in the
opinion of the Company's accountants the manner in which
Capital Accounts are to be maintained pursuant to the
preceding provisions of this SECTION 8.3 should be modified in
order to comply with Section 704(b) of the Code and the
Treasury Regulations thereunder, then notwithstanding anything
to the contrary contained in the preceding provisions of this
SECTION 8.3, the method in which Capital Accounts are
maintained shall be so modified; provided, however,
29
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
that any change in the manner of maintaining Capital
Accounts shall not materially alter the economic agreement
between or among the Members or Economic Interest Owners.
(d) Upon liquidation of the Company, liquidating
distributions will be made in accordance with the Members' or
Economic Interest Owner's respective Membership Interests or
Economic Interests, as determined after taking into account
all Capital Account adjustments for the Company's taxable
year during which the liquidation occurs. Liquidation
proceeds will be paid in accordance with SECTION 12.3. The
Company may offset damages for breach of this Company
Agreement by a Member or Economic Interest Owner whose
interest is liquidated (either upon the withdrawal of the
Member or the liquidation of the Company) against the amount
otherwise distributable to such Member or Economic Interest
Owner.
(e) Except as otherwise required in the Code or
applicable laws, (and subject to the provisions of ARTICLE 8),
no Member or Economic Interest Owner shall have any liability
to restore all or any portion of a deficit balance in such
Member's or Economic Interest Owner's Capital Account.
8.6 WITHDRAWAL OR REDUCTION OF MEMBERS' CONTRIBUTIONS TO
CAPITAL. Except as specifically set forth herein, a Member or Economic
Interest Owner shall not be entitled to demand or receive out of the
Company's property any part of its Capital Contribution except upon
liquidation of the Company.
ARTICLE 9
ALLOCATIONS, INCOME TAX, DISTRIBUTIONS, ELECTIONS AND REPORTS
9.1 ALLOCATIONS OF PROFITS AND LOSSES FROM OPERATIONS. Except
as specifically set forth in this ARTICLE 9, the Net Profits and Net Losses
of the Company for each Fiscal Year will be allocated in accordance with the
relative aggregate Membership Interest of each Member or Economic Interest
Owner set forth opposite such Member's or Economic Interest Owner's name on
Exhibit A as such may be amended from time to time upon the admission of
additional Members pursuant to the provisions hereof.
9.2 SPECIAL ALLOCATIONS TO CAPITAL ACCOUNTS AND CERTAIN OTHER
INCOME TAX ALLOCATIONS. Notwithstanding Section 9.1 hereof:
30
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
(a) In the event any Member or Economic Interest
Owner unexpectedly receives any adjustments, allocations, or
distributions described in Sections 1.704-1(b)(2)(ii)(d)(4),
(5), or (6) of the Treasury Regulations, which create or
increase a Deficit Capital Account of such Member or Economic
Interest Owner, then items of Company income and gain
(consisting of a pro rata portion of each item of Company
income, including gross income, and gain for such year and,
if necessary, for subsequent years) shall be specially
allocated to such Member or Economic Interest Owner in an
amount and manner sufficient to eliminate, to the extent
required by the Treasury Regulations, the Deficit Capital
Account so created as quickly as possible. It is the intent
that this SECTION 9.2(a) be interpreted to comply with the
alternate test for economic effect set forth in Section
1.704-1(b)(2)(ii)(d) of the Treasury Regulations.
(b) In the event any Member or Economic Interest
Owner would have a Deficit Capital Account at the end of any
Company taxable year which is in excess of the sum of any
amount that such Member or Economic Interest Owner is
obligated to restore to the Company under Section
1.704-1(b)(2)(ii)(c) of the Treasury Regulations and such
Member's or Economic Interest Owner's share of minimum gain as
defined in Section 1.704-2(g)(1) of the Treasury Regulations
(which is also treated as an obligation to restore in
accordance with Section 1.704-1(b)(2)(ii)(d) of the Treasury
Regulations), the Capital Account of such Member or Economic
Interest Owner shall be specially credited with items of
Company income (including gross income) and gain in the amount
of such excess as quickly as possible.
(c) Notwithstanding any other provision of this
SECTION 9.2, if there is a net decrease in the Company's
minimum gain as defined in Treasury Regulation Section
1.704-2(d) during a taxable year of the Company, then, the
Capital Accounts of each Member shall be allocated items of
income (including gross income) and gain for such year (and if
necessary for subsequent years) equal to that Member's or
Economic Interest Owner's share of the net decrease in Company
minimum gain. This SECTION 9.2(c) is intended to comply with
the minimum gain chargeback requirement of Section 1.704-2 of
the Treasury Regulations and shall be interpreted consistently
therewith. If in any taxable year that the Company has a net
decrease in the Company's minimum gain, if the minimum gain
chargeback requirement would cause a distortion in the
economic arrangement among the Members or Economic Interest
Owners and it is not expected that the Company will have
31
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
sufficient other income to correct that distortion, the
Manager may in its discretion (and shall, if requested to do
so by a Member) seek to have the Internal Revenue Service
waive the minimum gain chargeback requirement in accordance
with Treasury Regulation Section 1.704-2(f)(4).
(d) Items of Company loss, deduction and
expenditures described in Section 705(a)(2)(B) which are
attributable to any nonrecourse debt of the Company and are
characterized as partner (Member) nonrecourse deductions under
Section 1.704-2(i) of the Treasury Regulations shall be
allocated to the Members' or Economic Interest Owners' Capital
Accounts in accordance with said Section 1.704-2(i) of the
Treasury Regulations.
(e) Beginning in the first taxable year in which
there are allocations of "nonrecourse deductions" (as
described in Section 1.704-2(b) of the Treasury Regulations),
such deductions shall be allocated to the Members or Economic
Interest Owners in the same manner as Net Profit or Net Loss
is allocated for such period.
(f) In accordance with Section 704(c)(1)(A) of
the Code and Section 1.704-1(b)(2)(i)(iv) of the Treasury
Regulations, if a Member or Economic Interest Owner
contributes property with a initial Gross Asset Value that
differs from its adjusted basis at the time of contribution,
income, gain, loss and deductions with respect to the property
shall, solely for federal income tax purposes (and not for
Capital Account purposes), be allocated among the Members or
Economic Interest Owners so as to take account of any
variation between the adjusted basis of such property to the
Company and its Gross Asset Value at the time of contribution.
(g) Pursuant to Section 704(c)(1)(B) of the
Code, if any contributed property is distributed by the
Company other than to the contributing Member or Economic
Interest Owner within five years of being contributed, then,
except as provided in Section 704(c)(2) of the Code, the
contributing Member or Economic Interest Owner shall, solely
for federal income tax purposes (and not for Capital Account
purposes), be treated as recognizing gain or loss from the
sale of such property in an amount equal to the gain or loss
that would have been allocated to such Member or Economic
Interest Owner under Section 704(c)(1)(A) of the Code if the
property had been sold at its fair market value at the time of
the distribution.
32
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
(h) In the case of any distribution by the
Company to a Member or Economic Interest Owner, such Member or
Economic Interest Owner shall, solely for federal income tax
purposes (and not for Capital Account purposes), be treated as
recognizing gain in an amount equal to the lesser of:
(i) the excess (if any) of (A) the
fair market value of the property (other than money)
received in the distribution over (B) the adjusted
basis of such Member's or Economic Interest Owner's
Membership Interest or Economic Interest in the
Company immediately before the distribution reduced
(but not below zero) by the amount of money received
in the distribution, or
(ii) the Net Precontribution Gain (as
defined in Section 737(b) of the Code) of the Member
or Economic Interest Owner. The Net Precontribution
Gain means the net gain (if any) which would have
been recognized by the distributee Member or
Economic Interest Owner under Section 704(c)(1)(B)
of the Code if all property which (1) had been
contributed to the Company within five years of the
distribution, and (2) is held by the Company
immediately before the distribution, had been
distributed by the Company to another Member or
Economic Interest Owner. If any portion of the
property distributed consists of property which had
been contributed by the distributee Member or
Economic Interest Owner to the Company, then such
property shall not be taken into account under this
SECTION 9.2(h) and shall not be taken into account
in determining the amount of the Net Precontribution
Gain. If the property distributed consists of an
interest in an Entity, the preceding sentence shall
not apply to the extent that the value of such
interest is attributable to the property contributed
to such Entity after such interest had been
contributed to the Company.
(i) All recapture of income tax deductions
resulting from sale or disposition of Company property shall be
allocated to the Member or Members (or Economic Interest Owner) to
whom the deduction that gave rise to such recapture was allocated
hereunder to the extent that such Member or Economic Interest Owner
is allocated any gain from the sale or other disposition of such
property.
(j) Any credit or charge to the Capital Accounts of
the Members or Economic Interest Owners pursuant to SECTIONS
9.2(a), (b), (c), (d), and/or (e) hereof shall be taken into
33
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
account in computing subsequent allocations of profits and losses
pursuant to SECTION 9.1, so that the net amount of any items
charged or credited to Capital Accounts pursuant to SECTIONS 9.1
and 9.2(a), (b), (c), (d), and/or (e) shall to the extent possible,
be equal to the net amount that would have been allocated to the
Capital Account of each Member or Economic Interest Owner pursuant
to the provisions of this ARTICLE 9 if the special allocations
required by SECTIONS 9.2(a), (b), (c), (d), and/or (e) hereof had
not occurred.
9.3 DISTRIBUTIONS. The Company shall, to the extent it is able
to do so without, in the opinion of the Manager, jeopardizing the ability of
the Company to pay its obligations as they become due, distribute an amount
annually which is sufficient to pay the amount of federal income taxes of the
Members which arise as a consequence of the ownership by that Member of a
Membership Interest. Additionally, at least annually, the Manager shall
determine in its reasonable judgment to what extent, if any, the Company's
cash on hand exceeds the current and anticipated needs, including, without
limitation, needs for operating expenses, debt service, construction,
development, Plant operations, acquisitions, and Reserves, such excess amount
being referred to as "Available Cash". To the extent such Available Cash
exists, the Manager shall make annual distributions of Available Cash to the
Members within 60 days of the end of the Company's fiscal year as follows:
Volume of Liquid Product Produced % of Distribution % of Distribution After
in a Given Six Month Period Before Payout Payout
----------------------------------------- ------------------------- ------------------------
Synt ECT SLH Synt ECT SLH
---- --- --- ---- --- ---
Above 1,343,000 barrels 87.93 11.0 1.07 87.93 11.0 1.07
(7,900 B/D x 170 days)
Between 1,190,000 and 1,343,000 85.74 13.0 1.26 86.83 12.0 1.17
(7,000 B/D x 170 days)
Between 1,020,000 and 1,190,000 83.55 15.0 1.45 85.18 13.5 1.32
(6,000 B/D x 170 days)
Below 1,020,000 75.87 22.0 2.13 78.04 20.0 1.96
(5,000 B/D x 170 days)
9.4 STRUCTURING FEE In addition to the distributions provided
in SECTION 9.3, the Company shall pay to ECT Securities Corp. a one time
cash distribution equal to 3% of ECT's aggregate Capital Contributions as,
and payable at the time, of the first cash distribution to Members is made by
the Company.
34
Syntroleum-Sweetwater Company Agreement
--------------------------------------------------------------------------------
CONFIDENTIAL
9.5 LIMITATION UPON DISTRIBUTIONS. No distribution shall be
declared and paid unless, after the distribution is made, the assets of the
Company are in excess of all liabilities of the Company.
9.6 ACCOUNTING PRINCIPLES. The profits and losses of the Company
shall be determined in accordance with accounting principles applied on a
consistent basis. It is intended that the Company will elect those
accounting methods which provide the Company with the greatest tax benefits.
9.7 INTEREST ON AND RETURN OF CAPITAL CONTRIBUTIONS. No Member or
Economic Interest Owner shall be entitled to interest on its Capital
Contribution or to return of its Capital Contribution, except as otherwise
specifically provided for herein.
9.8 LOANS TO COMPANY. Nothing in this Company Agreement shall
prevent any Member or Economic Interest Owner from making secured or
unsecured loans to the Company by agreement with the Company.
9.9 ACCOUNTING PERIOD. The Company's accounting period shall
be the calendar year.
9.10 RECORDS, AUDITS AND REPORTS. The Manager shall maintain
records and accounts of all operations and expenditures of the Company. At a
minimum, the Company shall keep at its principal place of business the
following records:
(a) a current list of the full name and last known business,
residence, or mailing address of each Member or Economic Interest
Owner, both past and present;
(b) a copy of the Certificate of Formation of the Company and
all amendments thereto, together with executed copies of any powers of
attorney pursuant to which any amendment has been executed;
(c) copies of the Company's federal, state, and local income
tax returns and reports, if any, for the four most recent years;
(d) copies of the Company's currently effective written Company
Agreement,
35
Syntroleum-Sweetwater Company Agreement
--------------------------------------------------------------------------------
CONFIDENTIAL
copies of any writings permitted or required with respect to a Member's
or Economic Interest Owner's obligation to contribute cash, property or
services, and copies of any financial statements of the Company for the
two most recent years;
(e) minutes of every annual or special meeting;
(f) any written consents obtained from Members or Economic
Interest Owners for actions taken by Members without a meeting; and
(g) annual and quarterly financial statements of the Company
prepared in conformity with generally accepted accounting principles
which will be distributed to any Member upon request.
9.11 RETURNS AND OTHER ELECTIONS. The Manager shall cause the
preparation and timely filing of all tax returns required to be filed by the
Company pursuant to the Code and all other tax returns deemed necessary and
required in each jurisdiction in which the Company does business. Copies of
such returns, or pertinent information therefrom, shall be furnished to the
Members or Economic Interest Owners within a reasonable time after the end of
the Company's Fiscal Year. The Manager shall serve as the Company's "Tax
Matters Partner" under the Code. All elections permitted to be made by the
Company under federal or state laws shall be made by the Manager in its sole
discretion.
ARTICLE 10
TRANSFERABILITY, WITHDRAWAL AND CESSATION OF MEMBERSHIP
10.1 GENERAL. Except as otherwise specifically provided herein, no
Member or Economic Interest Owner shall have the right to:
(a) sell, assign, transfer, exchange, pledge, hypothecate, grant
a security in, permit a lien, charging order or encumbrance to
exist on, or otherwise transfer or dispose of for consideration
(collectively, "sell" or "sale"), or
(b) gift, bequeath or otherwise transfer for no consideration
whether or not by operation of law (collectively "gift") all or any
part of its Membership Interest or Economic
36
Syntroleum-Sweetwater Company Agreement
--------------------------------------------------------------------------------
CONFIDENTIAL
Interest. Each Member or Economic Interest Owner hereby acknowledges
the reasonableness of the restrictions on sale and gift of Membership
Interests or Economic Interests imposed by this Company Agreement in
view of the Company purposes and the relationship of the Members or
Economic Interest Owners. Accordingly, the restrictions on sale and
gift contained herein shall be specifically enforceable. In the event
that any Member or Economic Interest Owner pledges or otherwise
encumbers any of its Membership Interest or Economic Interest as
security for repayment of a liability, any such pledge or hypothecation
shall be made pursuant to a pledge or hypothecation agreement that
requires the pledgee or secured party to be bound by all the terms and
conditions of this ARTICLE 10 and require the secured party, upon a
default or other event which would entitle it to foreclose upon such
Membership Interest, to offer the Membership Interest for sale to the
other Members pursuant to the right of first refusal of provisions
of SECTION 10.2.
10.2 RIGHT OF FIRST REFUSAL.
(a) A Selling Member which desires to sell all or any portion
of its Membership Interest or Economic Interest in the Company for
cash only to a third party purchaser including a Member shall obtain
from such third party purchaser a bona fide written offer to purchase
such interest, stating the terms and conditions upon which the
purchase is to be made and the cash consideration offered therefor.
The Selling Member shall give written notification to the remaining
Members, by certified mail or personal delivery, of its intention to
so transfer such interest, furnishing to the remaining Members a copy
of the aforesaid written offer to purchase such interest.
(b) The remaining Members, and each of them, shall, on a basis
pro rata to their Membership Interests or on a basis pro rata to the
Membership Interests of those remaining Members exercising their right
of first refusal, have the right to exercise a right of first refusal
to purchase all (but not less than all) of the interest proposed to
be sold by the Selling Member upon the same terms and conditions as
stated in the aforesaid written offer to purchase by giving written
notification to the Selling Member, by certified mail or personal
delivery, of their intention to do so within ninety (90) days after
receiving written notice from the Selling Member and, within such
ninety (90) day period, demonstrating to the reasonable satisfaction
of the Selling Member (which demonstration may include furnishing
financial statements, loan commitments or other assurances consistent
with transactions of this nature) such remaining Members' financial
ability to complete the
37
Syntroleum-Sweetwater Company Agreement
--------------------------------------------------------------------------------
CONFIDENTIAL
purchase of the Selling Member's Membership Interest as provided
in this SECTION 10.2. In the event that the remaining Members (i) do
not so notify the Selling Member of their desire to exercise this
right of first refusal and purchase all of such interest within said
ninety (90) day period, or (ii) do not make such satisfactory
demonstration of financial ability, the Selling Member shall be
entitled to consummate the sale of such interest in the Company to
such third party purchaser on the terms set forth in the notice
delivered in accordance with SECTION 10.2(a) provided that such sale
shall be consummated within 120 days of the date such notice was given.
(c) In the event the remaining Members (or any one or more of
the remaining Members) give written notice to the Selling Member of
their desire to exercise their right of first refusal and to purchase
all of the Selling Member's interest in the Company which the Selling
Member desires to sell upon the same terms and conditions as are
stated in the aforesaid written offer to purchase, the remaining
Members shall have the right to designate the time, date and place of
closing, provided that the date of closing shall be within one hundred
twenty (120) days after receipt of written notification from the
Selling Member of the third party offer to purchase.
(d) In the event of either the purchase of the Selling
Member's interest in the Company by a third party purchaser or the
gift of an interest in the Company, and as a condition to recognizing
the effectiveness and binding nature of any such sale or gift, the
Company may require the Selling Member or Gifting Member and the
proposed purchaser, donee or successor-in-interest, as the case may
be, to execute, acknowledge and deliver to the Company such
instruments of transfer, assignment and assumption and such other
certificates, representations and documents, and to perform all such
other acts which the Company may deem necessary or desirable to:
(i) constitute such purchaser or donee as a Member or
Economic Interest Owner;
(ii) maintain the status of the Company as a partnership for
federal tax purposes;
(iii) confirm that the Person desiring to acquire an
interest or interests in the Company as a Member or Economic
Interest Owner has accepted, assumed and
38
Syntroleum-Sweetwater Company Agreement
--------------------------------------------------------------------------------
CONFIDENTIAL
agreed to be subject and bound by all of the terms,
obligations and conditions of the Company Agreement, as the
same may have been further amended;
(iv) preserve the Company after the completion of
such sale, transfer, assignment, or substitution under the
laws of each jurisdiction in which the Company is qualified,
organized or does business;
(v) assure compliance with any applicable state
and federal laws including securities laws and regulations.
(e) As a condition to recognition of any such proposed sale or
gift, the Company shall have the right to request and receive an opinion
of counsel acceptable to the Company confirming that any such transfer
will not change the treatment of the Company as a partnership for tax
purposes or result in the termination of the Company under Section 708
of the Code and that such proposed transfer has been made, or when made
will be in compliance with applicable federal and state securities laws.
Upon any sale or gift permitted hereunder, the Company shall continue
and no vote of Members need be taken in order for the Company to so
continue and such event shall not cause a dissolution of the Company.
(f) Any sale or gift of a Membership Interest or Economic Interest or
admission of a Member in compliance with this ARTICLE 10 shall be deemed
effective as of the last day of the calendar month in which the
remaining Members' consent thereto was given, or, if no such consent was
required, then on such date that the donee or successor in interest
complies with SECTION 10.2(c). The Transferring Member agrees, upon
request of the remaining Members, to execute such certificates or other
documents and perform such other acts as may be reasonably requested by
the remaining Members from time to time in connection with such sale,
transfer, assignment, or substitution. The Transferring Member hereby
indemnifies the Company and the remaining Members against any and all
loss, damage, or expense (including, without limitation, tax liabilities
or loss of tax benefits) arising directly or indirectly as a result of
any transfer or purported transfer in violation of this ARTICLE 10.
39
Syntroleum-Sweetwater Company Agreement
--------------------------------------------------------------------------------
CONFIDENTIAL
10.3 RIGHT OF ASSIGNEE AS A MEMBER.
(a) Notwithstanding anything contained herein to the
contrary (including, without limitation, SECTION 10.2 hereof), if the
Manager and Members holding at least 50% of the Membership Interest,
excluding that held by the Member or Economic Interest Owner making
such sale or gift, do not approve by written consent of the proposed
sale or gift of the Transferring Member's Membership Interest or
Economic Interest to a transferee or donee which is not a Member
immediately prior to the sale or gift, then the proposed transferee or
donee shall have no right to participate in the management of the
business and affairs of the Company or to become a Member. Such
transferee or donee shall be merely an Economic Interest Owner. No sale
or gift of a Member's interest in the Company (including any transfer
of the Economic Interest or any other transfer which has not been
approved as provided herein) shall be effective unless and until
written notice (including the name and address of the proposed
transferee or donee and the date of such transfer) has been provided to
the Company and the non-transferring Member(s). In the event that any
Member sells or gives its Membership Interest to more than five
Persons, the Company may require the assignees to appoint a nominee to
hold all of the Economic Interest, such nominee to be responsible for
accounting for the various interests of such assignees.
(b) Upon and contemporaneously with any sale or gift of a
Transferring Member's Economic Interest in the Company which does not
at the same time transfer the balance of the rights associated with the
Members' Membership Interest (including, without limitation, the rights
of the Transferring Member to participate in the management of the
business and affairs of the Company), the Company shall purchase from
the Transferring Member, and the Transferring Member shall sell to the
Company for a purchase price of $100.00, all remaining rights and
interests retained by the Transferring Member.
10.4 WITHDRAWAL. No Member shall have the right to resign or withdraw his
Membership Interest from the Company.
10.5 DISSOCIATION OF A MEMBER.
(a) A Person shall cease to be a Member upon the happening of any of
the following events:
40
Syntroleum-Sweetwater Company Agreement
--------------------------------------------------------------------------------
CONFIDENTIAL
(i) the Member's becoming a Bankrupt Member;
(ii) in the case of a Member that is an Entity other than a
corporation, the termination, dissolution, liquidation and/or
commencement of winding up of the Entity;
(iii) in the case of a Member that is a corporation, the filing of a
certificate of dissolution, or its equivalent, for the corporation or the
revocation of its charter;
(iv) the death, resignation or expulsion or withdrawal (as
permitted by the Act) of a Member who is an individual.
Any such event Member shall be known as a "Dissociated Member" and such
event shall be referred to as a "Dissociation."
(b) Upon any Dissociation, the Company shall continue and no vote
of Members need be taken in order for the Company to so continue and
such event shall not cause a dissolution of the Company. Upon the
Dissociation of a Member, Members holding a majority of the remaining
Membership Interest shall, subject to the provisions of the Act, elect
one of the two following provisions:
(i) The Dissociated Member's Membership Interest shall
be purchased by the Company for a purchase price equal to the
aggregate fair market value of the Member's Interest
determined according to the provisions of SECTION 10.5(c)
below. The purchase price of such interest shall be paid by
the Company to the Member in cash within 60 days of
determination of the aggregate fair market value or, at the
Company's option, said debt may be evidenced by a promissory
note bearing interest at the floating prime rate of interest
set forth as the average prime rate in the Wall Street
Journal, which shall be due and payable upon the expiration
of five years; or
(ii) The Dissociated Member, or assignee of Dissociated
Member's Interest, shall hold the Dissociated Member's Membership
Interest as an assignee.
41
Syntroleum-Sweetwater Company Agreement
--------------------------------------------------------------------------------
CONFIDENTIAL
(c) The fair market value of a Member's Interest to be purchased
by the Company pursuant to SECTION 10.5(b) above shall be determined by
agreement between the Dissociated Member (or the assignee of the
Dissociated Member's Membership Interest, as the case may be) and the
Company, which agreement is subject to approval by Members holding in
the aggregate at least 50% of the Membership Interest held by all
Members other than the Disassociated Member. For this purpose, the fair
market value of the Dissociated Member's Membership Interest shall be
computed as the amount which could reasonably be expected to be
realized by such Member upon the sale of the Company assets in the
ordinary course of the business at the time of Dissociation. If the
Dissociated Member (or the Assignee of the Dissociated Member's
Membership Interest, as the case may be) and the Company cannot agree
upon the fair market value of such Membership Interest within 30 days
of the Disassociation, the fair market value thereof shall be
determined by appraisal, the Company and the terminated Member each to
choose one appraiser and the two appraisers so chosen to choose a third
appraiser. The decision of a majority of the appraisers as to the fair
market value of such Membership Interest shall be final and binding and
may be enforced by legal proceedings. The Dissociated Member and the
Company shall each compensate the appraiser appointed by it and the
compensation of the third appraiser shall be borne equally by such
parties.
(d) The provision set forth herein shall not effect any claim
for damages the Company may have against the Dissociated Member if such
Dissociation is in violation of this Company Agreement. The Company
shall have the right to offset any payments due under this SECTION 10.5
by any damages that the Company may incur as a result of a Dissociation
of a Member in contravention of this Company Agreement.
ARTICLE 11
ADDITIONAL MEMBERS
In addition to any Member properly admitted pursuant to ARTICLE
10 upon a sale or gift and any Members admitted under the provisions of
SECTIONS 8.2, 8.3 or 8.4, any Person acceptable to all of the Members may
become a Member in this Company upon the unanimous consent of all Members
by the issuance by the Company of Membership Interests for such
consideration as is unanimously approved by such Members. No new Members
shall be entitled to any retroactive allocation of losses, income or
expense deductions incurred by the Company. The Manager may, at
42
Syntroleum-Sweetwater Company Agreement
--------------------------------------------------------------------------------
CONFIDENTIAL
its option, at the time a Member is admitted, close the Company books
(as though the Company's tax year had ended) or make pro rata allocations
of loss, income and expense deductions to a new Member for that portion of
the Company's tax year in which a Member was admitted in accordance with the
provisions of Section 706(d) of the Code and the Treasury Regulations
promulgated thereunder.
ARTICLE 12
DISSOLUTION AND TERMINATION
12.1 DISSOLUTION.
(a) The Company shall be dissolved upon the occurrence of any of
the following events:
(i) all Members agree in writing to dissolve the Company; or
(ii) the entry of a decree of judicial dissolution under Section
18-802 of the Act.
(b) The Members agree that neither the death, retirement,
resignation, expulsion, withdrawal, bankruptcy or dissolution of any
Member nor any other event that terminates the continued membership of
any Member shall result in the dissolution of the Company.
12.2 WINDING UP, LIQUIDATION AND DISTRIBUTION OF ASSETS
(a) Upon dissolution, an accounting shall be made by the Company's
independent accountants of the accounts of the Company and of the Company's
assets, liabilities and operations, from the date of the last previous
accounting until the date of dissolution. The Manager shall immediately
proceed to wind up the affairs of the Company and shall have all of the
rights with respect thereto as set forth in the Act.
(b) If the Company is dissolved and its affairs are to be wound up,
the Manager shall:
43
Syntroleum-Sweetwater Company Agreement
--------------------------------------------------------------------------------
CONFIDENTIAL
(i) Sell or otherwise liquidate all of the Company's assets as
promptly as practicable (except to the extent the Manager may determine
to distribute any assets to the Members in kind) provided that, the
Manager shall be authorized to take such time in the sale of such
assets as it deems reasonable to obtain the best available price
therefor;
(ii) Allocate any Net Profit or Net Loss resulting from such
sales to the Members' Capital Accounts in accordance with ARTICLE 9
hereof;
(iii) Discharge, contest, or make reasonable provision for,
including any settlement or compromise deemed reasonable in respect
thereof, all liabilities of the Company, including liabilities to
Members who are also creditors, to the extent otherwise permitted by
law, other than liabilities to Members for distributions and the return
of capital, and establish such Reserves as may be reasonably necessary
to provide for contingent liabilities of the Company (for purposes of
determining the Capital Accounts of the Members, the amounts of such
Reserves shall be deemed to be an expense of the Company),
(iv) Distribute the remaining assets in the following order:
(1) If any assets of the Company are to be distributed in
kind, the net fair market value of such assets as of the date of
dissolution shall be determined by independent appraisal or by
agreement of the Members. Such assets shall be deemed to have
been sold as of the date of dissolution for their fair market
value, and the Capital Accounts of the Members shall be adjusted
pursuant to the provisions of ARTICLE 9 and of this Company
Agreement to reflect such deemed sale.
(2) The positive balance (if any) of each Member's Capital
Account (as determined after taking into account all Capital
Account adjustments for the Company's taxable year during which
the liquidation occurs) shall be distributed to the Members,
either in cash or in kind, as determined by the Manager, with any
assets distributed in kind being valued for this purpose at their
fair market value. Any such distributions to the
44
Syntroleum-Sweetwater Company Agreement
--------------------------------------------------------------------------------
CONFIDENTIAL
Members in respect of their Capital Accounts shall be made in
accordance with the time requirements set forth in
Section 1.704-1(b)(2)(ii)(b)(2) of the Treasury Regulations.
(3) Not withstanding the provisions of SECTIONS
12.2(b)(iv)(1) and (2), in the event the Company is dissolved
within three years of the Effective Date, the remaining assets of
the Company shall be distributed to all Members in proportion to
their Capital Contributions made in cash until such time as such
distributions equal such cash Capital Contributions plus an a
simple annual rate of return on such Capital Contributions of 30%.
(c) Notwithstanding anything to the contrary in this Company
Agreement, upon a liquidation within the meaning of Section
1.704-1(b)(2)(ii)(g) of the Treasury Regulations, if any Member has a
Deficit Capital Account (after giving effect to all contributions,
distributions, allocations and other Capital Account adjustments for
all taxable years, including the year during which such liquidation
occurs), such Member shall have no obligation to make any Capital
Contribution, and the negative balance of such Member's Capital
Account shall not be considered a debt owed by such Member to the
Company or to any other Person for any purpose whatsoever.
(d) Upon completion of the winding up, liquidation and
distribution of the assets, the Company shall be deemed terminated.
(e) The Manager shall comply with any applicable requirements of
applicable law pertaining to the winding up of the affairs of the
Company and the final distribution of its assets.
12.3 RETURN OF CONTRIBUTION NONRECOURSE TO OTHER MEMBERS. Except
as provided by law or as expressly provided in this Company Agreement,
upon dissolution, each Member shall look solely to the assets of the
Company for the return of its Capital Contribution. If the Company
property remaining after the payment or discharge of the debts and
liabilities of the Company is insufficient to return the cash
contribution of one or more Members, such Members shall have no
recourse against any other Member.
45
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
12.4 FILING OF CERTIFICATE OF CANCELLATION. Upon the dissolution and
completion of the winding up of the Company, the Manager shall file a
Certificate of Cancellation with the Delaware Secretary of State.
ARTICLE 13
MISCELLANEOUS PROVISIONS
13.1 NOTICES. Any notices or other written communications provided for
hereunder shall be in writing and shall be deemed given (i) when received if
delivered in person, (ii) when sent if by facsimile transmission and a
confirmation is received, (iii) two business days after deposit with an
express courier if couriered on an internationally recognized express
courier, or (iv) three business days after deposit with the United States
Mail if mailed by registered or certified mail (return receipt requested),
postage prepaid. All notices or other communications to the parties shall be
at the addresses set forth in ARTICLE 4.
13.2 APPLICATION OF DELAWARE LAW. This Company Agreement, and the
application or interpretation hereof, shall be governed exclusively by its
terms and by the laws of the State of Delaware, and specifically the Act. The
parties expressly and irrevocably consent and submit to the jurisdiction of
any federal or state court sitting in Wilmington, Delaware and agree that, to
the fullest extent allowed by law, such Delaware federal and state courts
shall have jurisdiction over any action, suit or proceeding arising out of or
relating to this Agreement. The parties each irrevocably waive, to the
fullest extent allowed by law, any objection any one or more of them may have
to the laying of venue of any such suit, action or proceeding brought in any
state or federal court sitting in Wilmington, Delaware based upon a claim
that such court is inconvenient or otherwise an objectionable forum. Any
process in any action, suit or proceeding arising out of or relating to this
Agreement may, among other methods, be served upon any party by delivering it
or mailing it to their respective addresses set forth herein. Any such
delivery or mail service shall be deemed to have the same force and effect as
personal service in Wilmington, Delaware. The parties agree that the
provisions of this SECTION 13.2 relating to jurisdiction and venue shall not
be deemed to be the consent by any party to the exclusive jurisdiction or
venue of any federal or state court sitting in Wilmington, Delaware.
13.3 WAIVER OF ACTION FOR PARTITION. Each Member irrevocably waives
during the term of the Company any right that it may have to maintain any
action for partition with respect to the property of the Company.
46
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
13.4 AMENDMENTS. This Company Agreement may not be amended except by
the unanimous written agreement of all of the Members.
13.5 EXECUTION OF ADDITIONAL INSTRUMENTS. Each Member hereby agrees to
execute such other and further statements of interest and holdings,
designations, powers of attorney and other instruments necessary to comply
with any laws, rules or regulations.
13.6 CONSTRUCTION. Whenever the singular number is used in this
Company Agreement and when required by the context, the same shall include
the plural and vice versa, and the masculine gender shall include the
feminine and neuter genders and vice versa.
13.7 HEADINGS AND PRONOUNS. The headings in this Company Agreement are
inserted for convenience only and are in no way intended to describe,
interpret, define, or limit the scope, extent or intent of this Company
Agreement or any provision hereof. All pronouns and only variations thereof
shall be deemed to refer to masculine, feminine, or neuter, singular or
plural as the identity of the Person or Persons may require.
13.8 WAIVERS. The failure of any party to seek redress for violation
of or to insist upon the strict performance of any covenant or condition of
this Company Agreement shall not prevent a subsequent act, which would have
originally constituted a violation, from having the effect of an original
violation.
13.9 RIGHTS AND REMEDIES CUMULATIVE. The rights and remedies provided
by this Company Agreement are cumulative and the use of any one right or
remedy by any party shall not preclude or waive the right to use any or all
other remedies. Said rights and remedies are given in addition to any other
rights the parties may have by law, statute, ordinance or otherwise.
13.10 SEVERABILITY. If any provision of this Company Agreement or the
application thereof to any person or circumstance shall be invalid, illegal
or unenforceable to any extent, the remainder of this Company Agreement and
the application there of shall not be affected and shall be enforceable to
the fullest extent permitted by law.
47
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
13.11 ASSIGNMENT. Except as expressly contemplated in this Company
Agreement, neither this Company Agreement nor any of the rights, interests or
obligations hereunder shall be assigned (which, for the purpose of this
SECTION 13.11, includes the sale or other transfer of a majority of the
voting securities of a party) by a party (whether by operation of law or
otherwise) without the prior written consent of all parties, except for (a)
an assignment by a party to an Entity which is 100% owned by such party, or
(b) an assignment by ECT to any Affiliate of ECT which is not engaged in
business or operations which could reasonably be deemed to be in competition
with the primary business or operations of the Company (including subsequent
assignments by any such Affiliate to any other Affiliate which meets the
foregoing conditions), each of which assignments may be made without the
consent of the other parties, provided that written notice of any such
assignment shall be promptly given to the other parties. Each and all of the
covenants, terms, provisions and agreements herein contained shall be binding
upon and inure to the benefit of the parties and, to the extent permitted by
this Company Agreement, their respective legal representatives, successors
and assigns.
13.12 CREDITORS. None of the provisions of this Company Agreement shall
be for the benefit of or enforceable by any creditors of the Company.
13.13 COUNTERPARTS. This Company Agreement may be executed in
counterparts, each of which shall be deemed an original but all of which
shall constitute one and the same instrument.
13.14 INVESTMENT REPRESENTATIONS.
(a) The undersigned Members understand (1) that the Membership
Interests evidenced by this Company Agreement have not been registered
under the Securities Act of 1933, or any state securities laws (the
"Securities Acts") because the Company is issuing these Membership
Interests in reliance upon the exemptions from the registration
requirements of the Securities Acts providing for issuance of
securities not involving a public offering, (2) that the Company has
relied upon the fact that the Membership Interests are to be held by
each Member for investment, and (3) that exemption from registrations
under the Securities Acts would not be available if the Membership
Interests were acquired by a Member with a view to distribution.
(b) Each Member hereby confirms to the Company that such Member
is acquiring the Membership Interests for such own Member's account,
for investment and not
48
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
with a view to the resale or distribution thereof. Each Member agrees
not to transfer, sell or offer for sale any of portion of the
Membership Interests unless there is an effective registration or other
qualification relating thereto under the Securities Acts or unless the
holder of Membership Interests delivers to the Company an opinion of
counsel, satisfactory to the Company, that such registration or other
qualification under such Securities Acts is not required in connection
with such transfer, offer or sale. Each Member understands that the
Company is under no obligation to register the Membership Interests or
to assist such Member in complying with any exemption from registration
under the Securities Acts if such Member should at a later date, wish
to dispose of the Membership Interest.
13.15 LIMITATION ON DAMAGES. In no event shall a party be liable to the
other parties for any special, indirect, consequential, incidental, punitive,
or exemplary damages, including without limitation, lost profits or savings,
regardless of the form of action giving rise to such a claim for such
damages, whether in contract or tort including negligence, even if a party
has been advised of the possibility of such damages. In the event a party is
found, despite the provisions of this SECTION 13.15, liable to another party
for special, indirect, consequential, incidental, punitive, or exemplary
damages, then the maximum limit of such damages is agreed to be $5,000.
49
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
CERTIFICATE
The undersigned hereby agree, acknowledge and certify that the foregoing
Company Agreement constitutes the Company Agreement of Syntroleum/Sweetwater
Company, L.L.C. adopted by the Members of the Company effective as of the
Effective Date.
SYNTROLEUM/SWEETWATER COMPANY, L.L.C.
By Syntroleum Corporation, its Manager
[SEAL]
By: /s/ Xxxx X. Xxxx
----------------------------------
Xxxx X. Xxxx, President
MEMBERS:
SYNTROLEUM CORPORATION
[SEAL]
By: /s/ Xxxx X. Xxxx
----------------------------------
Xxxx X. Xxxx, President
SLH CORPORATION
By: /s/ Xxxxx X. Xxxxxx
----------------------------------
Xxxxx X. Xxxxxx, Chief Executive Officer
ENRON CAPITAL & TRADE RESOURCES CORP.
By: /s/ J. Xxxxx XxXxxxxxxx
----------------------------------
Title: Vice President
----------------------------------
50
Syntroleum-Sweetwater Company Agreement
------------------------------------------------------------------------------
CONFIDENTIAL
EXHIBIT A
Units Purchased % Membership Interest
------------------- --------------------------------------
Class Class Capital Class Class
Member A B Contribution A B Aggregate
---------------------- ------- ------- -------------- ------- ------- -----------
Syntroleum Corporation 90.0 -- License 100% -- 90.0%
Agreement and
$500,000
SLH Corporation -- 6.0 $1,500,000 -- 60.0% 6.0%
Enron Capital & Trade -- 4.0 $1,000,000 -- 40.0% 4.0%
Resources Corp.
------- ------- -----------
100% 100% 100%
------- ------- -----------
------- ------- -----------
51
