SECOND AMENDED AND RESTATED OPERATING AGREEMENT OF FIRST UNITED ETHANOL, LLC Dated April 5, 2006
EXHIBIT 3.3
SECOND AMENDED AND RESTATED OPERATING AGREEMENT
OF
FIRST UNITED ETHANOL, LLC
Dated April 5, 2006
FIRST UNITED ETHANOL, LLC
SECOND AMENDED AND RESTATED OPERATING AGREEMENT
SECOND AMENDED AND RESTATED OPERATING AGREEMENT
TABLE OF CONTENTS
Page | ||||
SECTION 1: THE COMPANY |
1 | |||
1.1 Formation |
1 | |||
1.2 Name |
1 | |||
1.3 Purpose; Powers |
1 | |||
1.4 Principal Place of Business |
2 | |||
1.5 Term |
2 | |||
1.6 Title to Property |
2 | |||
1.7 Payment of Individual Obligations |
2 | |||
1.8 Independent Activities; Transactions With Affiliates |
2 | |||
1.9 Definitions |
3 | |||
SECTION 2. CAPITAL CONTRIBUTIONS; CAPITAL ACCOUNTS |
9 | |||
2.1 Original Capital Contributions |
9 | |||
2.2 Additional Capital Contributions; Additional Units |
9 | |||
2.3 Capital Accounts |
9 | |||
SECTION 3. ALLOCATIONS |
10 | |||
3.1 Profits |
10 | |||
3.2 Losses |
10 | |||
3.3 Special Allocations |
10 | |||
3.4 Curative Allocations |
12 | |||
3.5 Loss Limitation |
12 | |||
3.6 Other Allocation Rules |
12 | |||
3.7 Tax Allocations: Code Section 704(c) |
13 | |||
3.8 Tax Credit Allocations |
13 | |||
SECTION 4. DISTRIBUTIONS |
13 | |||
4.1 Net Cash Flow |
13 | |||
4.2 Amounts Withheld |
14 | |||
4.3 Limitations on Distributions |
14 | |||
SECTION 5. MANAGEMENT |
14 | |||
5.1 Directors |
14 | |||
5.2 Number of Total Directors |
14 | |||
5.3 Election of Directors |
14 | |||
5.4 Removal of Directors |
16 | |||
5.5 Committees |
16 | |||
5.6 Authority of Directors |
16 | |||
5.7 Director as Agent |
18 |
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5.8 Restriction on Authority of Directors |
18 | |||
5.9 Director Meetings and Notice |
19 | |||
5.10 Action Without a Meeting |
19 | |||
5.11 Quorum; Manner of Acting |
20 | |||
5.12 Voting; Potential Financial Interest |
20 | |||
5.13 Duties and Obligations of Directors |
20 | |||
5.14 Chairman and Vice Chairman |
20 | |||
5.15 President and Chief Executive Officer |
20 | |||
5.16 Chief Financial Officer |
21 | |||
5.17 Secretary; Assistant Secretary |
21 | |||
5.18 Vice President |
21 | |||
5.19 Delegation |
21 | |||
5.20 Execution of Instruments |
21 | |||
5.21 Limitation of Liability; Indemnification of Directors |
21 | |||
5.22 Compensation; Expenses of Directors |
22 | |||
5.23 Loans |
22 | |||
SECTION 6. ROLE OF MEMBERS |
23 | |||
6.1 One Membership Class |
23 | |||
6.2 Members |
23 | |||
6.3 Additional Members |
23 | |||
6.4 Rights or Powers |
23 | |||
6.5 Voting Rights of Members |
23 | |||
6.6 Member Meetings |
23 | |||
6.7 Conduct of Meetings |
23 | |||
6.8 Notice of Meetings; Waiver |
24 | |||
6.9 Quorum and Proxies |
24 | |||
6.10 Voting; Action by Members |
24 | |||
6.11 Record Date |
24 | |||
6.12 Termination of Membership |
24 | |||
6.13 Continuation of the Company |
24 | |||
6.14 No Obligation to Purchase Membership Interest |
24 | |||
6.15 Waiver of Dissenters Rights |
25 | |||
6.16 Limitation on Ownership |
25 | |||
SECTION 7. ACCOUNTING, BOOKS AND RECORDS |
25 | |||
7.1 Accounting, Books and Records |
25 | |||
7.2 Delivery to Members and Inspection |
25 | |||
7.3 Reports |
26 | |||
7.4 Tax Matters |
26 | |||
SECTION 8. AMENDMENTS |
27 | |||
8.1 Amendments |
27 | |||
SECTION 9. TRANSFERS |
27 | |||
9.1 Restrictions on Transfers |
27 | |||
9.2 Permitted Transfers |
27 |
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9.3 Conditions Precedent to Transfers |
28 | |||
9.4 Prohibited Transfers |
29 | |||
9.5 No Dissolution or Termination |
30 | |||
9.6 Prohibition of Assignment |
30 | |||
9.7 Rights of Unadmitted Assignees |
30 | |||
9.8 Admission of Substituted Members |
30 | |||
9.9 Representations Regarding Transfers |
31 | |||
9.10 Distribution and Allocation in Respect of Transferred Units |
31 | |||
9.11 Additional Members |
32 | |||
SECTION 10. DISSOLUTION AND WINDING UP |
32 | |||
10.1 Dissolution |
32 | |||
10.2 Winding Up |
32 | |||
10.3 Compliance with Certain Requirements of Regulations; Deficit
Capital Accounts |
33 | |||
10.4 Deemed Distribution and Recontribution |
33 | |||
10.5 Rights of Unit Holders |
33 | |||
10.6 Allocations During Period of Liquidation |
34 | |||
10.7 Character of Liquidating Distributions |
34 | |||
10.8 The Liquidator |
34 | |||
10.9 Forms of Liquidating Distributions |
34 | |||
SECTION 11. MISCELLANEOUS |
34 | |||
11.1 Notices |
34 | |||
11.2 Binding Effect |
35 | |||
11.3 Construction |
35 | |||
11.4 Headings |
35 | |||
11.5 Severability |
35 | |||
11.6 Incorporation By Reference |
35 | |||
11.7 Variation of Terms |
35 | |||
11.8 Governing Law |
35 | |||
11.9 Waiver of Jury Trial |
35 | |||
11.10 Counterpart Execution |
35 | |||
11.11 Specific Performance |
35 |
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THIS SECOND AMENDED AND RESTATED OPERATING AGREEMENT (the “Agreement”) is entered into and
shall be effective as of the 5 day of April, 2006, by and among First United Ethanol,
LLC, a Georgia limited liability company (the “Company”), each of the Persons (as hereinafter
defined) who are identified as Members on the attached Exhibit “A” and who have executed a
counterpart of this Agreement and a Subscription Agreement, and any other Persons as may from
time-to-time be subsequently admitted as a Member of the Company in accordance with the terms of
this Agreement. Capitalized terms not otherwise defined herein shall have the meaning set forth in
Section 1.9.
WHEREAS, the Company’s organizers caused to be filed with the State of Georgia, Articles of
Organization dated March 9, 2005, pursuant to the Georgia Limited Liability Company Act (the
“Act”); and
WHEREAS, the Company’s organizers adopted an Operating Agreement of the Company dated
September 6, 2005, pursuant to the Act; and
WHEREAS, the Members desired to amend and restate the Operating Agreement to revise, and set
forth their respective rights, duties, and responsibilities with respect to the Company and its
business and affairs and adopted an Amended and Restated Operating Agreement on December 14, 2005,
pursuant to the Act.
NOW, THEREFORE, in consideration of the covenants and agreements contained herein, and other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
SECTION 1. THE COMPANY
1.1 Formation. The initial Members formed the Company as a Georgia limited liability
company by filing Articles of Organization with the Georgia Secretary of State on March 9, 2005
pursuant to the provisions of the Act. To the extent that the rights or obligations of any Member
are different by reason of any provision of this Agreement than they would be in the absence of
such provision, this Agreement shall, to the extent permitted by the Act, control.
1.2 Name. The name of the Company shall be “First United Ethanol, LLC” and all business of
the Company shall be conducted in such name.
1.3 Purpose; Powers. The nature of the business and purposes of the Company are: (i) to
own, construct, operate, lease, finance, contract with, and/or
invest in ethanol production and co-product production facilities as permitted under the applicable
laws of the State of Georgia; (ii)
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to engage in the processing of corn, grains and other feedstock
into ethanol and any and all related co-products, and the marketing of all products and co-products
from such processing; and (iii) to engage in any other business and investment activity in which a
Georgia limited liability company may lawfully be engaged, as determined by the Directors. The
Company has the power to do any and all acts necessary, appropriate, proper, advisable, incidental
or convenient to or in furtherance of the purpose of the Company as set forth in this Section 1.3
and has, without limitation, any and all powers that may be exercised on behalf of the Company by
the Directors pursuant to Section 5 hereof.
1.4 Principal Place of Business. The Company shall continuously maintain an office in
Georgia. The principal office of the Company shall be at 0 X. Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxx
00000, or elsewhere in the State of Georgia as the Directors may determine. Any documents required
by the Act to be kept by the Company shall be maintained at the Company’s principal office.
1.5 Term. The term of the Company commenced on the date the Articles of Organization (the
“Articles”) of the Company were filed with the office of the Georgia Secretary of State, and shall
continue until the winding up and liquidation of the Company and its business is completed
following a Dissolution Event as provided in Section 10 hereof.
1.6 Title to Property. All Property owned by the Company shall be owned by the Company as
an entity and no Member shall have any ownership interest in such Property (as hereinafter defined)
in his/her/its individual name. Each Member’s interest in the Company shall be personal property
for all purposes. At all times after the Effective Date, the Company shall hold title to all of
its Property in the name of the Company and not in the name of any Member.
1.7 Payment of Individual Obligations. The Company’s credit and assets shall be used
solely for the benefit of the Company, and no asset of the Company shall be Transferred or
encumbered for, or in payment of, any individual obligation of any Member.
1.8 Independent Activities; Transactions With Affiliates. The Directors shall be required
to devote such time to the affairs of the Company as may be necessary to manage and operate the
Company, and shall be free to serve any other Person or enterprise in any capacity that the
Director may deem appropriate in such Director’s discretion. Neither this Agreement nor any
activity undertaken pursuant hereto shall (i) prevent any Member or Director or its Affiliates,
acting on its own behalf, from engaging in whatever activities it chooses, whether the same are
competitive with the Company or otherwise, and any such activities may be undertaken without having
or incurring any obligation to offer any interest in such activities to the Company or any Member;
or (ii) require any Member or Director to permit the Company or Director or Member or its
Affiliates to participate in any such activities, and as a material part of the consideration for
the execution of this Agreement by each Member, each Member hereby waives, relinquishes, and
renounces any such right or claim of participation. To the extent permitted by applicable law and
subject to the provisions of this Agreement, the Directors are hereby authorized to cause the
Company to purchase Property from, sell Property to or otherwise deal with any Member (including
any Member who is also a Director), acting on its own behalf, or any Affiliate of any Member;
provided that any such purchase, sale or other transaction shall be made on terms and
2
conditions
which are no less favorable to the Company than if the sale, purchase or other transaction had been
made with an independent third party.
1.9 Definitions. Capitalized words and phrases used in this Agreement have the following
meanings:
(a) “Act” means the Georgia Limited Liability Company Act, as amended from time to time (or
any corresponding provision or provisions of any succeeding law).
(b) “Adjusted Capital Account Deficit” means, with respect to any Unit Holder, the deficit
balance, if any, in such Unit Holder’s Capital Account as of the end of the relevant Fiscal Year,
after giving effect to the following adjustments: (i) Credit to such Capital Account any amounts
which such Unit Holder is deemed to be obligated to restore pursuant to the next to the last
sentences in Sections 1.704-2(g)(1) and 1.704-2(i)(5) of the Regulations; and (ii) Debit to such
Capital Account the items described in Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5)
and 1.704-1(b)(2)(ii)(d)(6) of the Regulations. The foregoing definition is intended to comply
with the provisions of Section 1.704-1(b)(2)(ii)(d) of the Regulations and shall be interpreted
consistently therewith.
(c) “Affiliate” means, with respect to any Person: (i) any Person directly or indirectly
controlling, controlled by or under common control with such Person; (ii) any officer, director,
general partner, member or trustee of such Person; or (iii) any Person who is an officer, director,
general partner, member or trustee of any Person described in clauses (i) or (ii) of this sentence.
For purposes of this definition, the terms “controlling,” “controlled by” or “under common control
with” shall mean the possession, direct or indirect, of the power to direct or cause the direction
of the management and policies of a Person or entity, whether through the ownership of voting
securities, by contract or otherwise, or the power to elect at least 50% of the directors, members,
or persons exercising similar authority with respect to such Person or entities.
(d) “Agreement” means this Second Amended and Restated Operating Agreement of First United
Ethanol, LLC, as amended from time to time.
(e) “Articles” means the Articles of Organization of the Company filed with the Georgia
Secretary of State, as same may be amended from time to time.
(f) “Assignee” means a transferee of Units who is not admitted as a substituted member
pursuant to Section 9.8.
(g) “Capital Account” means the separate capital account maintained for each Unit Holder in
accordance with Section 2.3.
(h) “Capital Contributions” means, with respect to any Member, the amount of money (US
Dollars) and the initial Gross Asset Value of any assets or property (other than money) contributed
by the Member (or such Member’s predecessor in interest) to the Company (net of liabilities secured
by such contributed property that the Company is considered to assume
3
or take subject to under Code
Section 752) with respect to the Units in the Company held or purchased by such Member, including
additional Capital Contributions.
(i) “Code” means the United States Internal Revenue Code of 1986, as amended from time to
time.
(j) “Company” means First United Ethanol, LLC, a Georgia limited liability company.
(k) “Company Minimum Gain” has the meaning given the term “partnership minimum gain” in
Sections 1.704-2(b)(2) and 1.704-2(d) of the Regulations.
(l) “Debt” means (i) any indebtedness for borrowed money or the deferred purchase price of
property as evidenced by a note, bonds, or other instruments; (ii) obligations as lessee under
capital leases; (iii) obligations secured by any mortgage, pledge, security interest, encumbrance,
lien or charge of any kind existing on any asset owned or held by the Company whether or not the
Company has assumed or become liable for the obligations secured thereby; (iv) any obligation under
any interest rate swap agreement; (v) accounts payable; and (vi) obligations under direct or
indirect guarantees of (including obligations (contingent or otherwise) to assure a creditor
against loss in respect of) indebtedness or obligations of the kinds referred to in clauses (i),
(ii), (iii), (iv) and (v), above provided that Debt shall not include obligations in respect of any
accounts payable that are incurred in the ordinary course of the Company’s business and are not
delinquent or are being contested in good faith by appropriate proceedings.
(m) “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
Directors.
(n) “Director” means any Person who (i) is referred to as such in Section 5.1 of this
Agreement or has become a Director pursuant to the terms of this Agreement, and (ii) has not ceased
to be a Director pursuant to the terms of this Agreement. “Directors” means all such Persons. For
purposes of the Act, the Directors shall be deemed to be the “managers” (as such term is defined
and used in the Act) of the Company.
(o) “Dissolution Event” shall have the meaning set forth in Section 10.1 hereof.
(p) “Effective
Date” means April 5, 2006.
4
(q) “Facilities” shall mean the ethanol production and co-product production facilities in
Georgia or such other location as may be determined by the Directors to be constructed and operated
by the Company pursuant to the Company’s business plan as may be amended from time to time.
(r) “Fiscal Year” means (i) any twelve-month period commencing on October 1 and ending on
September 30 and (ii) the period commencing on the immediately preceding October 1 and ending on
the date on which all Property is distributed to the Unit Holders pursuant to Section 10 hereof,
or, if the context requires, any portion of a Fiscal Year for which an allocation of Profits or
Losses or a distribution is to be made.
(s) “GAAP” means generally accepted accounting principles in effect in the United States of
America from time to time.
(t) “Gross Asset Value” means with respect to any asset, the asset’s adjusted basis for
federal income tax purposes, except as follows: (i) The initial Gross Asset Value of any asset
contributed by a Member to the Company shall be the gross fair market value of such asset, as
determined by the Directors provided that the initial Gross Asset Values of the assets contributed
to the Company pursuant to Section 2.1 hereof shall be as set forth in such section; (ii) The Gross
Asset Values of all Company assets shall be adjusted to equal their respective gross fair market
values (taking Code Section 7701(g) into account), as determined by the Directors as of the
following times: (A) the acquisition of an additional interest in the Company by any new or
existing Member in exchange for more than a de minimis Capital Contribution; (B) the distribution
by the Company to a Member of more than a de minimis amount of Company property as consideration
for an interest in the Company; and (C) the liquidation of the Company within the meaning of
Regulations Section 1.704-1(b)(2)(ii)(g), provided that an adjustment described in clauses (A) and
(B) of this paragraph shall be made only if the Directors reasonably determine that such adjustment
is necessary to reflect the relative economic interests of the Members in the Company; (iii) The
Gross Asset Value of any item of Company assets distributed to any Member shall be adjusted to
equal the gross fair market value (taking Code Section 7701(g) into account) of such asset on the
date of distribution as determined by the Directors; 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
adjustments are taken into account in determining Capital Accounts pursuant to Regulations Section
1.704-1(b)(2)(iv)(m) and subparagraph (vi) of the definition of “Profits” and “Losses” or Section
3.3(c) hereof; provided, however, that Gross Asset Values shall not be adjusted pursuant to this
subparagraph (iv) to the extent that an adjustment pursuant to subparagraph (ii) is required 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 (ii) or (iv), such Gross Asset Value shall thereafter be adjusted by the
Depreciation taken into account with respect to such asset, for purposes of computing Profits and
Losses.
(u) “Issuance Items” has the meaning set forth in Section 3.3(h) hereof.
(v) “Liquidation Period” has the meaning set forth in Section 10.6 hereof.
5
(w) “Liquidator” has the meaning set forth in Section 10.8 hereof.
(x) “Losses” has the meaning set forth in the definition of “Profits” and “Losses.”
(y) “Member” means any Person (i) whose name is set forth as such on Exhibit “A” initially
attached hereto or has become a Member pursuant to the terms of this Agreement, and (ii) who is the
owner of one or more Units.
(z) “Members” means all such Members.
(aa) “Membership Economic Interest” means collectively, a Member’s share of “Profits” and
“Losses,” the right to receive distributions of the Company’s assets, and the right to information
concerning the business and affairs of the Company provided by the Act. The Membership Economic
Interest of a Member is quantified by the unit of measurement referred to herein as “Units.”
(bb) “Membership Interest” means collectively, the Membership Economic Interest and Membership
Voting Interest.
(cc) “Membership Register” means the membership register maintained by the Company at its
principal office or by a duly appointed agent of the Company setting forth the name, address, the
number of Units, and Capital Contributions of each Member of the Company, which shall be modified
from time to time as additional Units are issued and as Units are transferred pursuant to this
Agreement.
(dd) “Membership Voting Interest” means collectively, a Member’s right to vote as set forth in
this Agreement or required by the Act. The Membership Voting Interest of a Member shall mean as to
any matter to which the Member is entitled to vote hereunder or as may be required under the Act,
the right to one (1) vote for each Unit registered in the name of such Member as shown in the
Membership Register.
(ee) “Net Cash Flow” means the gross cash proceeds of the Company less the portion thereof
used to pay or establish reserves for all Company expenses, debt payments, capital improvements,
replacements, and contingencies, all as reasonably determined by the Directors. “Net Cash Flow”
shall not be reduced by depreciation, amortization, cost recovery deductions, or similar
allowances, but shall be increased by any reductions of reserves previously established.
(ff) “Nonrecourse Deductions” has the meaning set forth in Section 1.704-2(b)(1) of the
Regulations.
(gg) “Nonrecourse Liability” has the meaning set forth in Section 1.704-2(b)(3) of the
Regulations.
(hh) “Officer” or “Officers” has the meaning set forth in Section 5.18 hereof.
6
(ii) “Permitted Transfer” has the meaning set forth in Section 9.2 hereof.
(jj) “Person” means any individual, partnership (whether general or limited), joint venture,
limited liability company, corporation, trust, estate, association, nominee or other entity.
(kk) “Profits and Losses” mean, for each Fiscal Year, an amount equal to the Company’s taxable
income or loss for such Fiscal Year, determined in accordance with Code Section 703(a) (for this
purpose, all items of income, gain, loss, or deduction required to be stated separately pursuant to
Code Section 703(a)(1) shall be included in taxable income or loss), with the following adjustments
(without duplication): (i) Any income of the Company that is exempt from federal income tax and not
otherwise taken into account in computing Profits or Losses pursuant to this definition of
“Profits” and “Losses” shall be added to such taxable income or loss; (ii) Any expenditures of the
Company described in Code Section 705(a)(2)(b) or treated as Code Section 705(a)(2)(b) expenditures
pursuant to Regulations Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account in
computing Profits or Losses pursuant to this definition of “Profits” and “Losses” shall be
subtracted from such taxable income or loss; (iii) In the event the Gross Asset Value of any
Company asset is adjusted pursuant to subparagraphs (ii) or (iii) of the definition of Gross Asset
Value, the amount of such adjustment shall be treated as an item of gain (if the adjustment
increases the Gross Asset Value of the asset) or an item of loss (if the adjustment decreases the
Gross Asset Value of the asset) from the disposition of such asset and shall be taken into account
for purposes of computing Profits or Losses; (iv) Gain or loss resulting from any disposition of
Property with respect to which gain or loss is recognized for federal income tax purposes shall be
computed by reference to the Gross Asset Value of the Property disposed of, notwithstanding that
the adjusted tax basis of such Property differs from its Gross Asset Value; (v) 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,
computed in accordance with the definition of Depreciation; (vi) To the extent an adjustment to the
adjusted tax basis of any Company asset pursuant to Code Section 734(b) is required, pursuant to
Regulations Section 1.704-(b)(2)(iv)(m)(4), to be taken into account in determining Capital
Accounts as a result of a distribution other than in liquidation of a Unit Holder’s interest in the
Company, the amount of such adjustment shall be treated as an item of gain (if the adjustment
increases the basis of the asset) or loss (if the adjustment decreases such basis) from the
disposition of such asset and shall be taken into account for purposes of computing Profits or
Losses; and (vii) Notwithstanding any other provision of this definition, any items which are
specially allocated pursuant to Section 3.3 and Section 3.4 hereof shall not be taken into account
in computing Profits or Losses. The amounts of the items of Company income, gain, loss or
deduction available to be specially allocated pursuant to Sections 3.3 and Section 3.4 hereof shall
be determined by applying rules analogous to those set forth in subparagraphs (i) through (vi)
above.
(ll) “Property” means all real and personal property acquired by the Company, including cash,
and any improvements thereto, and shall include both tangible and intangible property.
(mm) “Regulations” means the Income Tax Regulations, including Temporary Regulations,
promulgated under the Code, as such regulations are amended from time to time.
7
(nn) “Regulatory Allocations” has the meaning set forth in Section 3.4 hereof.
(oo) “Related Party” means the adopted or birth relatives of any Person and such Person’s
spouse (whether by marriage or common law), if any, including without limitation
great-grandparents, grandparents, parents, children (including stepchildren and adopted children),
grandchildren, and great-grandchildren thereof, and such Person’s (and such Person’s spouse’s)
brothers, sisters, and cousins and their respective lineal ancestors and descendants, and any other
ancestors and/or descendants, and any spouse of any of the foregoing, each trust created for the
exclusive benefit of one or more of the foregoing, and the successors, assigns, heirs, executors,
personal representatives and estates of any of the foregoing.
(pp) “Securities Act” means the Securities Act of 1933, as amended.
(qq) “Subsidiary” means any corporation, partnership, joint venture, limited liability
company, association or other entity in which such Person owns, directly or indirectly, fifty
percent (50%) or more of the outstanding equity securities or interests, the holders of which are
generally entitled to vote for the election of the board of directors or other governing body of
such entity.
(rr) “Tax Matters Member” has the meaning set forth in Section 7.4 hereof.
(ss) “Transfer” means, as a noun, any voluntary or involuntary transfer, sale, pledge or
hypothecation or other disposition and, as a verb, voluntarily or involuntarily to transfer, give,
sell, exchange, assign, pledge, bequest or hypothecate or otherwise dispose of.
(tt) “Units” or “Unit” means an ownership interest in the Company representing a Capital
Contribution made as provided in Section 2 in consideration of the Units, including any and all
benefits to which the holder of such Units may be entitled as provided in this Agreement, together
with all obligations of such Person to comply with the terms and provisions of this Agreement.
(uu) “Unit Holders” means all Unit Holders.
(vv) “Unit Holder” means the owner of one or more Units.
(ww) “Unit Holder Nonrecourse Debt” has the same meaning as the term “partner nonrecourse
debt” in Section 1.704-2(b)(4) of the Regulations.
(xx) “Unit Holder Nonrecourse Debt Minimum Gain” means an amount, with respect to each Unit
Holder Nonrecourse Debt, equal to the Company Minimum Gain that would result if such Unit Holder
Nonrecourse Debt were treated as a Nonrecourse Liability, determined in accordance with Section
1.704-2(i)(3) of the Regulations.
(yy) “Unit Holder Nonrecourse Deductions” has the same meaning as the term “partner
nonrecourse deductions” in Sections 1.704-2(i)(1) and 1.704-2(i)(2) of the Regulations.
8
SECTION 2. CAPITAL CONTRIBUTIONS; CAPITAL ACCOUNTS
2.1 Original Capital Contributions. The name, original Capital Contribution, and initial
Units quantifying the Membership Interest of each Member are set out in Exhibit A attached hereto,
and shall also be set out in the Membership Register along with those Members admitted after the
Effective Date.
2.2 Additional Capital Contributions; Additional Units. No Unit Holder shall be obligated
to make any additional Capital Contributions to the Company or to pay any assessment to the
Company, other than any unpaid amounts on such Unit Holder’s original Capital Contributions, and no
Units shall be subject to any calls, requests or demands for capital. Subject to Section 5.7,
additional Membership Economic Interests quantified by additional Units may be issued in
consideration of Capital Contributions as agreed to between the Directors and the Person acquiring
the Membership Economic Interest quantified by the additional Units. Each Person to whom
additional Units are issued shall be admitted as a Member in accordance with this Agreement. Upon
such Capital Contributions, the Directors shall cause the Membership Register as maintained by the
Company at its principal office and incorporated herein by this reference, to be appropriately
amended and such amendments shall not be considered amendments to this Agreement for purposes of
Section 8.1 hereof.
2.3 Capital Accounts. A Capital Account shall be maintained for each Unit Holder in
accordance with the following provisions:
(a) To each Unit Holder’s Capital Account there shall be credited (i) such Unit Holder’s
Capital Contributions; (ii) such Unit Holder’s distributive share of Profits and any items in the
nature of income or gain which are specially allocated pursuant to Section 3.3 and Section 3.4; and
(iii) the amount of any Company liabilities assumed by such Unit Holder or which are secured by any
Property distributed to such Unit Holder;
(b) To each Unit Holder’s Capital Account there shall be debited (i) the amount of money and
the Gross Asset Value of any Property distributed to such Unit Holder pursuant to any provision of
this Agreement; (ii) such Unit Holder’s distributive share of Losses and any items in the nature of
expenses or losses which are specially allocated pursuant to Section 3.3 and 3.4 hereof; and (iii)
the amount of any liabilities of such Unit Holder assumed by the Company or which are secured by
any Property contributed by such Unit Holder to the Company;
(c) In the event Units are Transferred in accordance with the terms of this Agreement, the
transferee shall succeed to the Capital Account of the transferor to the extent it relates to the
Transferred Units; and
(d) In determining the amount of any liability for purposes of subparagraphs (a) and (b) above
there shall be taken into account Code Section 752(c) and any other applicable provisions of the
Code and Regulations.
9
The foregoing provisions and the other provisions of this Agreement relating to the maintenance of
Capital Accounts are intended to comply with Regulations Section 1.704-1(b), and shall be
interpreted and applied in a manner consistent with such Regulations. In the event the Directors
shall determine that it is prudent to modify the manner in which the Capital Accounts, or any
debits or credits thereto (including, without limitation, debits or credits relating to liabilities
which are secured by contributed or distributed property or which are assumed by the Company or any
Unit Holders), are computed in order to comply with such Regulations, the Directors may make such
modification, provided that it is not likely to have a material effect on the amounts distributed
to any Person pursuant to Section 10 hereof upon the dissolution of the Company. The Directors
also shall (i) make any adjustments that are necessary or appropriate to maintain equality between
the Capital Accounts of the Unit Holders and the amount of capital reflected on the Company’s
balance sheet, as computed for book purposes, in accordance with Regulations Section
1.704-1(b)(2)(iv)(q), and (ii) make any appropriate modifications in the event unanticipated events
might otherwise cause this Agreement not to comply with Regulations Section 1.704-1(b).
SECTION 3. ALLOCATIONS
3.1 Profits. After giving effect to the special allocations in Section 3.3 and Section 3.4
hereof, Profits for any Fiscal Year shall be allocated among the Unit Holders in proportion to
Units held.
3.2 Losses. After giving effect to the special allocations in Section 3.3 and 3.4 hereof,
Losses for any Fiscal Year shall be allocated among the Unit Holders in proportion to Units held.
3.3 Special Allocations. The following special allocations shall be made in the following
order:
(a) Minimum Gain Chargeback. Except as otherwise provided in Section 1.704-2(f) of
the Regulations, notwithstanding any other provision of this Section 3, if there is a net decrease
in Company Minimum Gain during any Fiscal Year, each Unit Holder shall be specially allocated items
of Company income and gain for such Fiscal Year (and, if necessary, subsequent Fiscal Years) in an
amount equal to such Unit Holder’s share of the net decrease in Company Minimum Gain, determined in
accordance with Regulations Section 1.704-2(g). Allocations pursuant to the previous sentence
shall be made in proportion to the respective amounts required to be allocated to each Unit Holder
pursuant thereto. The items to be so allocated shall be determined in accordance with sections
1.704-2(f)(6) and 1.704-2(j)(2) of the Regulations. This Section 3.3(a) is intended to comply with
the minimum gain chargeback requirement in Section 1.704-2(f) of the Regulations and shall be
interpreted consistently therewith.
(b) Unit Holder Minimum Gain Chargeback. Except as otherwise provided in Section
1.704-2(i)(4) of the Regulations, notwithstanding any other provision of this Section 3, if there
is a net decrease in Unit Holder Nonrecourse Debt Minimum Gain attributable to a Unit Holder
Nonrecourse Debt during any Fiscal Year, each Unit Holder who has a share of the Unit Holder
Nonrecourse Debt Minimum Gain attributable to such Unit Holder Nonrecourse Debt, determined in
accordance with Section 1.704-2(i)(5) of the Regulations, shall be specially
10
allocated items of
Company income and gain for such Fiscal Year (and, if necessary, subsequent Fiscal Years) in an
amount equal to such Unit Holder’s share of the net decrease in Unit Holder Nonrecourse Debt
Minimum Gain, determined in accordance with Regulations Section 1.704-2(i)(4). Allocations
pursuant to the previous sentence shall be made in proportion to the respective amounts required to
be allocated to each Unit Holder pursuant thereto. The items to be so allocated shall be
determined in accordance with Sections 1.704-2(i)(4) and 1.704-2(j)(2) of the Regulations. This
Section 3.3(b) is intended to comply with the minimum gain chargeback requirement in Section
1.704-2(i)(4) of the Regulations and shall be interpreted consistently therewith.
(c) Qualified Income Offset. In the event any Member unexpectedly receives any
adjustments, allocations, or distributions described in Sections 1.704-1(b)(2)(ii)(d)(4),
1.704-1(b)(2)(ii)(d)(5), or 1.704-1(b)(2)(ii)(d)(6) of the Regulations, items of Company income and
gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate,
to the extent required by the Regulations, the Adjusted Capital Account Deficit as soon as
practicable, provided that an allocation pursuant to this Section 3.3(c) shall be made only if and
to the extent that the Member would have an Adjusted Capital Account Deficit after all other
allocations provided for in this Section 3 have been tentatively made as if this Section 3.3(c)
were not in the Agreement.
(d) Gross Income Allocation. In the event any Member has a deficit Capital Account at
the end of any Fiscal Year which is in excess of the sum of (i) the amount such Member is obligated
to restore pursuant to any provision of this Agreement; and (ii) the amount such Member is deemed
to be obligated to restore pursuant to the penultimate sentences of Sections 1.704-2(g)(1) and
1.704-2(i)(5) of the Regulations, each such Member shall be specially allocated items of Company
income and gain in the amount of such excess as quickly as possible, provided that an allocation
pursuant to this Section 3.3(d) shall be made only if and to the extent that such Member would have
a deficit Capital Account in excess of such sum after all other allocations provided for in this
Section 3 have been made as if Section 3.3(c) and this Section 3.3(d) were not in this Agreement.
(e) Nonrecourse Deductions. Nonrecourse Deductions for any Fiscal Year or other
period shall be specially allocated among the Members in proportion to Units held.
(f) Unit Holder Nonrecourse Deductions. Any Unit Holder Nonrecourse Deductions for
any Fiscal Year shall be specially allocated to the Unit Holder who bears the economic risk of loss
with respect to the Unit Holder Nonrecourse Debt to which such Unit Holder Nonrecourse Deductions
are attributable in accordance with Regulations Section 1.704-2(i)(1).
(g) Section 754 Adjustments. To the extent an adjustment to the adjusted tax basis of
any Company asset, pursuant to Code Section 734(b) or Code Section 743(b) is required, pursuant to
Regulations Section 1.704-1(b)(2)(iv)(m)(2) or 1.704-1(b)(2)(iv)(m)(4), to be taken into account in
determining Capital Accounts as the result of a distribution to a Unit Holder in complete
liquidation of such Unit Holder’s interest in the Company, the amount of such adjustment to Capital
Accounts shall be treated as an item of gain (if the adjustment increases the basis of the asset)
or loss (if the adjustment decreases such basis) and such gain or loss shall be
11
specially allocated
to the Unit Holders in accordance with their interests in the Company in the event Regulations
Section 1.704-1(b)(2)(iv)(m)(2) applies, or to the Unit Holder to whom such distribution was made
in the event Regulations Section 1.704-1(b)(2)(iv)(m)(4) applies.
(h) Allocations Relating to Taxable Issuance of Company Units. Any income, gain, loss
or deduction realized as a direct or indirect result of the issuance of Units by the Company to a
Unit Holder (the “Issuance Items”) shall be allocated among the Unit Holders so that, to the extent
possible, the net amount of such Issuance Items, together with all other allocations under this
Agreement to each Unit Holder shall be equal to the net amount that would have been allocated to
each such Unit Holder if the Issuance Items had not been realized.
3.4 Curative Allocations. The allocations set forth in Sections 3.3(a), 3.3(b), 3.3(c),
3.3(d), 3.3(e), 3.3(f), 3.3(g) and 3.5 (the “Regulatory Allocations”) are intended to comply with
certain requirements of the Regulations. It is the intent of the Members that, to the extent
possible, all Regulatory Allocations shall be offset either with other Regulatory Allocations or
with special allocations of other items of Company income, gain, loss or deduction pursuant to this
Section 3.4. Therefore, notwithstanding any other provision of this Section 3 (other than the
Regulatory Allocations), the Directors shall make such offsetting special allocations of Company
income, gain, loss or deduction in whatever manner it determines appropriate so that, after such
offsetting allocations are made, each Member’s Capital Account balance is, to the extent possible,
equal to the Capital Account balance such Member would have had if the Regulatory Allocations were
not part of the Agreement and all Company items were allocated pursuant to Sections 3.1, 3.2, and
3.3(h).
3.5 Loss Limitation. Losses allocated pursuant to Section 3.2 hereof shall not exceed the
maximum amount of Losses that can be allocated without causing any Unit Holder to have an Adjusted
Capital Account Deficit at the end of any Fiscal Year. In the event some but not all of the Unit
Holders would have Adjusted Capital Account Deficits as a consequence of an allocation of Losses
pursuant to Section 3.2 hereof, the limitation set forth in this Section 3.5 shall be applied on a
Unit Holder by Unit Holder basis and Losses not allocable to any Unit Holder as a result of such
limitation shall be allocated to the other Unit Holders in accordance with the positive balances in
such Unit Holder’s Capital Accounts so as to allocate the maximum permissible Losses to each Unit
Holder under Section 1.704-1(b)(2)(ii)(d) of the Regulations.
3.6 Other Allocation Rules.
(a) For purposes of determining the Profits, Losses, or any other items allocable to any
period, Profits, Losses, and any such other items shall be determined on a daily, monthly, or
other basis, as determined by the Directors using any permissible method under Code Section
706 and the Regulations thereunder.
(b) The Unit Holders are aware of the income tax consequences of the allocations made by this
Section 3 and hereby agree to be bound by the provisions of this Section 3 in reporting their
shares of Company income and loss for income tax purposes.
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(c) Solely for purposes of determining a Unit Holder’s proportionate share of the “excess
nonrecourse liabilities” of the Company within the meaning of Regulations Section 1.752-3(a)(3),
the Unit Holders’ aggregate interests in Company profits shall be deemed to be as provided in the
capital accounts. To the extent permitted by Section 1.704-2(h)(3) of the Regulations, the
Directors shall endeavor to treat distributions of Net Cash Flow as having been made from the
proceeds of a Nonrecourse Liability or a Unit Holder Nonrecourse Debt only to the extent that such
distributions would cause or increase an Adjusted Capital Account Deficit for any Unit Holder.
(d) Allocations of Profits and Losses to the Unit Holders shall be allocated among them in the
ratio which each Unit Holder’s Units bears to the total number of Units issued and outstanding.
3.7 Tax Allocations: Code Section 704(c). In accordance with Code Section 704(c) and the
Regulations thereunder, income, gain, loss, and deduction with respect to any Property contributed
to the capital of the Company shall, solely for tax purposes, be allocated among the Unit Holders
so as to take account of any variation between the adjusted basis of such Property to the Company
for federal income tax purposes and its initial Gross Asset Value (computed in accordance with the
definition of Gross Asset Value). In the event the Gross Asset Value of any Company asset is
adjusted pursuant to subparagraph (ii) of the definition of Gross Asset Value, subsequent
allocations of income, gain, loss, and deduction with respect to such asset shall take account of
any variation between the adjusted basis of such asset for federal income tax purposes and its
Gross Asset Value in the same manner as under Code Section 704(c) and the Regulations thereunder.
Any elections or other decisions relating to such allocations shall be made by the Directors in any
manner that reasonably reflects the purpose and intention of this Agreement. Allocations pursuant
to this Section 3.7 are solely for purposes of federal, state, and local taxes and shall not
affect, or in any way be taken into account in computing, any Unit Holder’s Capital Account or
share of Profits, Losses, other items, or distributions pursuant to any provision of this
Agreement.
3.8 Tax Credit Allocations. All credits against income tax with respect to the Company’s
property or operations shall be allocated among the Members in accordance with their respective
membership interests in the Company for the Fiscal Year during which the expenditure, production,
sale, or other event giving rise to the credit occurs. This Section 3.8 is intended to comply with
the applicable tax credit allocation principles of section 1.704-1(b)(4)(ii) of the Regulations and
shall be interpreted consistently therewith.
SECTION 4. DISTRIBUTIONS
4.1 Net Cash Flow. The Directors, in their discretion, shall make distributions of Net
Cash Flow, if any, to the Members. Except as otherwise provided in Section 10 hereof, Net Cash
Flow, if any, shall be distributed to the Unit Holders in proportion to Units held subject to, and
to the extent permitted by, any loan covenants or restrictions on such distributions agreed to by
the Company in any loan, credit or any other debt financing agreements with the Company’s lenders
and creditors from time to time in effect. In determining Net Cash Flow, the Directors shall
13
endeavor to provide for cash distributions at such times and in such amounts as will permit the
Unit Holders to make timely payment of income taxes.
4.2 Amounts Withheld. All amounts withheld pursuant to the Code or any provision of any
state, local or foreign tax law with respect to any payment, distribution or allocation to the
Company or the Unit Holders shall be treated as amounts paid or distributed, as the case may be, to
the Unit Holders with respect to which such amount was withheld pursuant to this Section 4.2 for
all purposes under this Agreement. The Company is authorized to withhold from payments and
distributions, or with respect to allocations to the Unit Holders, and to pay over to any federal,
state and local government or any foreign government, any amounts required to be so withheld
pursuant to the Code or any provisions of any other federal, state or local law or any foreign law,
and shall allocate any such amounts to the Unit Holders with respect to which such amount was
withheld.
4.3 Limitations on Distributions. The Company shall make no distributions to the Unit
Holders except as provided in this Section 4 and Section 10 hereof. Notwithstanding any other
provision, no distribution shall be made if it is not permitted to be made under the Act.
SECTION 5. MANAGEMENT
5.1 Directors. Except as otherwise provided in this Agreement, the Directors shall direct
the business and affairs of the Company, and shall exercise all of the powers of the Company except
such powers as are by this Agreement conferred upon or reserved to the Members. The Directors
shall adopt such policies, rules, regulations, and actions not inconsistent with law or this
Agreement as it may deem advisable. Subject to Section 5.7 hereof or any other express provisions
hereof, the business and affairs of the Company shall be managed by or under the direction of the
Directors and not by its Members. The amendment or repeal of this section or the adoption of any
provision inconsistent therewith shall require an action by the Members pursuant to Section 6.10 of
this Agreement.
5.2 Number of Total Directors. The total number of Directors of the Company shall be a
minimum of seven (7) and a maximum of fifteen (15). The Members may increase or decrease the
number of Directors last approved and may change from a variable range to a fixed number or visa
versa by an action by the Members in accordance with Section 6.10 of this Agreement; provided,
however, that the Members may only increase the maximum number of Directors above fifteen (15) by a
super majority vote of seventy-five percent (75%) of the Membership Voting Interests.
5.3 Election of Directors.
(a) Election of Directors and Terms. The initial Directors shall be elected by the
initial Members and shall include the individuals set forth on Exhibit “B” attached hereto. The
initial Directors shall serve until the first annual or special meeting of the Members following
the date on which substantial operations of the Facilities commence, and in all cases until a
successor is elected and qualified, or until the earlier death, resignation, removal or
disqualification of any such Director. After the expiration of the initial terms of the Directors,
at
14
each annual meeting of the Members, Directors shall be elected by the Members for staggered
terms of three (3) years and until a successor is elected and qualified. Prior to the expiration
of their initial terms, the initial Directors shall, by written resolution, separately identify the
Director positions to be elected and so classify each such Director position as Group I, Group II
or Group III, with such classification to serve as the basis for the staggering of terms among the
elected Directors. The terms of Group I Directors shall expire first (initial term of one year
with successors elected to three year terms thereafter), followed by those of Group II Directors
(initial term of two years with successors elected to three year terms thereafter), and then Group
III Directors (initial and subsequent terms of three years). Directors shall be elected by a
plurality vote of the Members so that the nominees receiving the greatest number of votes relative
to all other nominees are elected as Directors.
(b) Nominations for Directors. One or more nominees for Director positions up for
election shall be named by the then current Directors or by a nominating committee established by
the Directors. Nominations for the election of Directors may also be made by any Member entitled
to vote generally in the election of Directors. However, any Member that intends to nominate one
or more persons for election as Directors at a meeting may do so only if written notice of such
Member’s intent to make such nomination or nominations has been given, either by personal delivery
or by United States mail, postage prepaid, to the Secretary of the Company not less than sixty (60)
days nor more than ninety (90) days prior to the first day of the month corresponding to the
previous year’s annual meeting. Each such notice to the Secretary shall set forth:
(i) | the name and address of record of the Member who intends to make the nomination; | ||
(ii) | a representation that the Member is a holder of record of Units of the Company entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to nominate the person or persons specified in the notice; | ||
(iii) | the name, age, business and residence addresses, and principal occupation or employment of each nominee; | ||
(iv) | a description of all arrangements or understandings between the Member and each nominee and any other person or persons (naming such person or persons) pursuant to which the nomination or nominations are to be made by the Members; | ||
(v) | such other information regarding each nominee proposed by such Member as would be required to be included in a proxy statement filed pursuant to the proxy rules of the Securities and Exchange Commission; | ||
(vi) | the consent of each nominee to serve as a Director of the Company if so elected; and | ||
(vii) | a nominating petition signed and dated by the holders of at least five percent (5%) of the then outstanding Units and clearly setting forth the proposed nominee as a candidate of the Director’s seat to be filled at the next election of Directors. |
15
The Company may require any proposed nominee to furnish such other information as may reasonably be
required by the Company to determine the eligibility of such proposed nominee to serve as a
Director of the Company. The presiding Officer of the meeting may, if the facts warrant, determine
that a nomination was not made in accordance with the foregoing procedures, and if he should so
determine, he shall so declare to the meeting and the defective nomination shall be disregarded.
The amendment or repeal of this Section or the adoption of any provision inconsistent therewith
shall require the approval of a majority of the Membership Voting Interests. Whenever a vacancy
occurs other than from expiration of a term of office or removal from office, a majority of the
remaining Directors shall appoint a new Director to fill the vacancy for the remainder of such
term.
5.4 Removal of Directors. Any person elected to serve as a Director of the Company may be
removed from the Board upon an action by the Members in accordance with Section 6.10 of this
Agreement. A Director may also be removed from the Board by a resolution approved by the
affirmative vote of a super majority of seventy-five percent (75%) of the Directors. The notice of
a meeting called or convened for the purpose of removing a Director must include a statement that
the purpose, or one of the purposes of the meeting is removal of a Director. A Director may be
removed with or without cause.
5.5 Committees. A resolution approved by the affirmative vote of a majority of the
Directors may establish committees having the authority of the Directors in the management of the
business of the Company to the extent consistent with this Agreement and provided in the
resolution. A committee shall consist of one or more persons appointed by affirmative vote of a
majority of the Directors present. A majority of the committee members shall be Directors but not
every committee member is required to be a Director. Committees may include a compensation
committee and/or an audit committee, in each case consisting of one or more independent Directors
or other independent persons. Committees are subject to the direction and control of the
Directors, and vacancies in the membership thereof shall be filled by the Directors. A majority of
the members of the committee present at a meeting is a quorum for the transaction of business,
unless a larger or smaller proportion or number is provided in a resolution approved by the
affirmative vote of a majority of the Directors present.
5.6 Authority of Directors. Subject to the limitations and restrictions set forth in this
Agreement, the Directors shall direct the management of the business and affairs of the Company and
shall have all of the rights and powers which may be possessed by a “manager” under the Act
including, without limitation, the right and power to do
or perform the following and, to the extent permitted by the Act or this Agreement, the further
right and power by resolution of the Directors to delegate to the Officers or such other Person or
Persons to do or perform the following:
(a) Conduct its business, carry on its operations and have and exercise the powers granted by
the Act in any state, territory, district or possession of the United States, or in any foreign
country which may be necessary or convenient to effect any or all of the purposes for which it is
organized;
16
(b) Acquire by purchase, lease, or otherwise any real or personal property which may be
necessary, convenient, or incidental to the accomplishment of the purposes of the Company;
(c) Operate, maintain, finance, improve, construct, own, grant operations with respect to,
sell, convey, assign, mortgage, and lease any real estate and any personal property necessary,
convenient, or incidental to the accomplishment of the purposes of the Company;
(d) Execute any and all agreements, contracts, documents, certifications, and instruments
necessary or convenient in connection with the management, maintenance, and operation of the
business, or in connection with managing the affairs of the Company, including, executing
amendments to this Agreement and the Articles in accordance with the terms of this Agreement, both
as Directors and, if required, as attorney-in-fact for the Members pursuant to any power of
attorney granted by the Members to the Directors;
(e) Borrow money and issue evidences of indebtedness necessary, convenient, or incidental to
the accomplishment of the purposes of the Company, and secure the same by mortgage, pledge, or
other lien on any Company assets;
(f) Execute, in furtherance of any or all of the purposes of the Company, any deed, lease,
mortgage, deed of trust, mortgage note, promissory note, xxxx of sale, contract, or other
instrument purporting to convey or encumber any or all of the Company assets;
(g) Prepay in whole or in part, refinance, recast, increase, modify, or extend any liabilities
affecting the assets of the Company and in connection therewith execute any extensions or renewals
of encumbrances on any or all of such assets;
(h) Care for and distribute funds to the Members by way of cash income, return of capital, or
otherwise, all in accordance with the provisions of this Agreement, and perform all matters in
furtherance of the objectives of the Company or this Agreement;
(i) Contract on behalf of the Company for the employment and services of employees and/or
independent contractors, such as lawyers and accountants, and delegate to such Persons the duty to
manage or supervise any of the assets or operations of the Company;
(j) Engage in any kind of activity and perform and carry out contracts of any kind (including
contracts of insurance covering risks to Company assets and Directors’ and Officers’ liability)
necessary or incidental to, or in connection with, the accomplishment of the purposes of
the Company, as may be lawfully carried on or performed by a limited liability company under
the laws of each state in which the Company is then formed or qualified;
(k) Take, or refrain from taking, all actions, not expressly proscribed or limited by this
Agreement, as may be necessary or appropriate to accomplish the purposes of the Company;
(l) Institute, prosecute, defend, settle, compromise, and dismiss lawsuits or other judicial
or administrative proceedings brought on or in behalf of, or against, the Company, the
17
Members or
the Directors or Officers in connection with activities arising out of, connected with, or
incidental to this Agreement, and to engage counsel or others in connection therewith;
(m) Purchase, take, receive, subscribe for or otherwise acquire, own, hold, vote, use, employ,
sell, mortgage, lend, pledge, or otherwise dispose of, and otherwise use and deal in and with,
shares or other interests in or obligations of domestic or foreign corporations, associations,
general or limited partnerships, other limited liability companies, or individuals or direct or
indirect obligations of the United States or of any government, state, territory, government
district or municipality or of any instrumentality of any of them;
(n) Agree with any Person as to the form and other terms and conditions of such Person’s
Capital Contribution to the Company and cause the Company to issue Membership Economic Interests
and Units in consideration of such Capital Contribution; and
(o) Indemnify a Member or Directors or Officers, or former Members or Directors or Officers,
and to make any other indemnification that is authorized by this Agreement in accordance with, and
to the fullest extent permitted by, the Act.
5.7 Director as Agent. Notwithstanding the power and authority of the Directors to manage
the business and affairs of the Company, no Director shall have authority to act as agent for the
Company for the purposes of its business (including the execution of any instrument on behalf of
the Company) unless the Directors have authorized the Director to take such action. The Directors
may also delegate authority to manage the business and affairs of the Company (including the
execution of instruments on behalf of the Company) to such Person or Persons (including to any
Officers) designated by the Directors, and such Person or Persons (or Officers) shall have such
titles and authority as determined by the Directors.
5.8 Restrictions on Authority of Directors.
(a) The Directors shall not have authority to, and they covenant and agree that they shall
not, do any of the following acts without the unanimous consent of the Members:
(i) | Cause or permit the Company to engage in any activity that is not consistent with the purposes of the Company as set forth in Section 1.3 hereof; | ||
(ii) | Knowingly do any act in contravention of this Agreement or which would make it impossible to carry on the ordinary business of the Company, except as otherwise provided in this Agreement; | ||
(iii) | Possess Company Property, or assign rights in specific Company Property, for other than a Company purpose; or | ||
(iv) | Cause the Company to voluntarily take any action that would cause a bankruptcy of the Company. |
18
(b) The Directors shall not have authority to, and they covenant and agree that they shall not
cause the Company to, without the consent of a majority of the Membership Voting Interests:
(i) | Merge, consolidate, exchange or otherwise dispose of all or substantially all of the Property, except for a liquidating sale of the Property in connection with the dissolution of the Company; | ||
(ii) | Confess a judgment against the Company in an amount in excess of $500,000; | ||
(iii) | Issue Units at a purchase price that is less than thirty percent (30%) of the purchase price offered to investors in the Company’s initial registered offering of Units; | ||
(iv) | Issue an aggregate number of Units that is greater than one hundred twenty-five percent (125%) of the maximum number of Units to be offered to investors in the Company’s initial registered offering of Units; or | ||
(v) | Cause the Company to acquire any equity or debt securities of any Director or any of its Affiliates, or otherwise make loans to any Director or any of its Affiliates. |
The actions specified herein as requiring the consent of the Members shall be in addition to any
actions by the Directors that are specified in the Act as requiring the consent or approval of the
Members. Unless otherwise required by this Agreement or the Act, any such required consent or
approval may be given by a vote of a majority of the Membership Voting Interests.
5.9 Director Meetings and Notice. Meetings of the Directors shall be held at such times
and places as shall from time to time be determined by the Directors. Meetings of the Directors
may also be called by the Chairman of the Company or by any two or more Directors. If the date,
time, and place of a meeting of the Directors has been announced at a previous meeting, no notice
shall be required. In all other cases, five (5) days’ written notice of meetings, stating the
date, time, and place thereof and any other information
required by law or desired by the Person(s) calling such meeting, shall be given to each Director.
Any Director may waive notice of any meeting. A waiver of notice by a Director is effective
whether given before, at, or after the meeting, and whether given orally, in writing, or by
attendance. The attendance of a Director at any meeting shall constitute a waiver of notice of
such meeting, unless such Director objects at the beginning of the meeting to the transaction of
business on the grounds that the meeting is now lawfully called or convened and does not
participate thereafter in the meeting.
5.10 Action Without a Meeting. Any action required or permitted to be taken by the
Directors may also be taken by a written action signed by a super majority of seventy-five percent
(75%) of all Directors authorized to vote on the matter as provided by this Agreement, provided
that a copy of such written action shall be promptly given to all such Directors. The Directors
may
19
participate in any meeting of the Directors by means of telephone conference or similar means
of communication by which all persons participating in the meeting can simultaneously hear each
other.
5.11 Quorum; Manner of Acting. Not less than fifty percent (50%) of the total number of
Directors authorized to vote on a matter as provided by this Agreement shall constitute a quorum
for the transaction of business at any Directors’ meeting. Each Director shall have one (1) vote
at meetings of the Directors. The Directors shall take action by the vote of a majority of the
number of Directors constituting a quorum as provided by this Agreement.
5.12 Voting; Potential Financial Interest. No Director shall be disqualified from voting
on any matter to be determined or decided by the Directors solely by reason of such Director’s (or
his/her Affiliate’s) potential financial interest in the outcome of such vote, provided that the
nature of such Director’s (or his/her Affiliate’s) potential financial interest was reasonably
disclosed to the Board of Directors on behalf of the Company at the time of such vote.
5.13 Duties and Obligations of Directors. The Directors shall cause the Company to conduct
its business and operations separate and apart from that of any Director or any of its Affiliates.
The Directors shall take all actions which may be necessary or appropriate (i) for the continuation
of the Company’s valid existence as a limited liability company under the laws of the State of
Georgia and each other jurisdiction in which such existence is necessary to protect the limited
liability of Members or to enable the Company to conduct the business in which it is engaged, and
(ii) for the accomplishment of the Company’s purposes, including the acquisition, development,
maintenance, preservation, and operation of Company Property in accordance with the provisions of
this Agreement and applicable laws and regulations. Each Director shall have the duty to discharge
the foregoing duties in good faith, in a manner the Director believes to be in the best interests
of the Company, and with the care an ordinarily prudent person in a like position would exercise
under similar circumstances. The Directors shall be under no other fiduciary duty to the Company
or the Members to conduct the affairs of the Company in a particular manner.
5.14 Chairman and Vice Chairman. Unless provided otherwise by a resolution adopted by the
Directors, the Chairman shall preside at meetings of the Members and the Directors; shall see that
all orders and resolutions of the Directors are carried into effect; may maintain records of and
certify proceedings of the Directors and Members; and shall perform such other duties as may from
time to time be prescribed by the Directors. The Vice Chairman shall, in the absence or disability
of the Chairman, perform the duties and exercise the powers of the Chairman and shall perform such
other duties as the Directors or the Chairman may from time to time prescribe. The Directors may
designate more than one Vice Chairmen, in which case the Vice Chairmen shall be designated by the
Directors so as to denote which is most senior in office.
5.15 President and Chief Executive Officer. Until provided otherwise by a resolution of
the Directors, the Chairman shall also act as the interim President and CEO of the Company (herein
referred to as the “President”; the titles of President and CEO shall constitute a reference to one
and the same office and Officer of the Company), and the Chairman may exercise the duties of the
office of Chairman using any such designations. The Directors shall appoint someone other
20
than the
Chairman as the President of the Company not later than the commencement of operations of the
Facilities, and such President shall perform such duties as the Directors may from time to time
prescribe, including without limitation, the management of the day-to-day operations of the
Facilities.
5.16 Chief Financial Officer. Unless provided otherwise by a resolution adopted by the
Directors, the Chief Financial Officer of the Company shall be the Treasurer of the Company and
shall keep accurate financial records for the Company; shall deposit all monies, drafts, and checks
in the name of and to the credit of the Company in such banks and depositories as the Directors
shall designate from time to time; shall endorse for deposit all notes, checks, and drafts received
by the Company as ordered by the Directors, making proper vouchers therefore; shall disburse
Company funds and issue checks and drafts in the name of the Company as ordered by the Directors,
shall render to the President and the Directors, whenever requested, an account of all such
transactions as Chief Financial Officer and of the financial condition of the Company, and shall
perform such other duties as may be prescribed by the Directors or the President from time to time.
5.17 Secretary; Assistant Secretary. The Secretary shall attend all meetings of the
Directors and of the Members and shall maintain records of, and whenever necessary, certify all
proceedings of the Directors and of the Members. The Secretary shall keep the required records of
the Company, when so directed by the Directors or other person or person authorized to call such
meetings, shall give or cause to be given notice of meetings of the Members and of meetings of the
Directors, and shall also perform such other duties and have such other powers as the Chairman or
the Directors may prescribe from time to time. An Assistant Secretary, if any, shall perform the
duties of the Secretary during the absence or disability of the Secretary.
5.18 Vice President. The Company may have one or more Vice Presidents. If more than one,
the Directors shall designate which is most senior. The most senior Vice President shall perform
the duties of the President in the absence of the President.
5.19 Delegation. Unless prohibited by a resolution of the Directors, the President, Chief
Financial Officer, Vice President and Secretary (individually, an “Officer” and collectively,
“Officers”) may delegate in writing some or all of the duties and powers of such Officer’s
management position to other Persons. An Officer who delegates the duties or powers of an office
remains subject to the standard of conduct for such Officer with respect to the discharge of all
duties and powers so delegated.
5.20 Execution of Instruments. All deeds, mortgages, bonds, checks, contracts and other
instruments pertaining to the business and affairs of the Company shall be signed on behalf of the
Company by (i) the Chairman; or (ii) when authorized by resolutions(s) of the Directors, the
President; or (iii) by such other person or persons as may be designated from time to time by the
Directors.
5.21 Limitation of Liability; Indemnification of Directors. To the maximum extent
permitted under the Act and other applicable law, no Member, Director or Officer of this Company
shall be personally liable for any debt, obligation or liability of this Company merely by reason
of being
21
a Member, Director, Officer or all of the foregoing. No Director or Officer of this
Company shall be personally liable to this Company or its Members for monetary damages for a breach
of fiduciary duty by such Director or Officer; provided that this provision shall not eliminate or
limit the liability of a Director or Officer for any of the following: (i) for any breach of the
duty of loyalty to the Company or its Members; (ii) for acts or omissions not in good faith or
which involve intentional misconduct or knowing violation of law; or (iii) for a transaction from
which the Director or Officer derived an improper personal benefit or a wrongful distribution in
violation of the Act. To the maximum extent permitted under the Act and other applicable law, the
Company, its receiver, or its trustee (in the case of its receiver or trustee, to the extent of
Company Property) shall indemnify, save and hold harmless, and pay all judgments and claims against
each Director or Officer relating to any liability or damage incurred by reason of any act
performed or omitted to be performed by such Director, or Officer, in connection with the business
of the Company, including reasonable attorneys’ fees incurred by such Director in connection with
the defense of any action based on any such act or omission, which attorneys’ fees may be paid as
incurred, including all such liabilities under federal and state securities laws as permitted by
law. To the maximum extent permitted under the Act and other applicable law, in the event of any
action by a Unit Holder against any Director or Officer, including a derivative suit, the Company
shall indemnify, save harmless, and pay all costs, liabilities, damages and expenses of such
Director or Officer, including reasonable attorneys’ fees incurred in the defense of such action.
Notwithstanding the foregoing provisions, no Director or Officer shall be indemnified by the
Company to the extent prohibited or limited (but only to the extent limited) by the Act. The
Company may purchase and maintain insurance on behalf of any Person in such Person’s official
capacity against any liability asserted against and incurred by such Person in or arising from that
capacity, whether or not the Company would otherwise be required to indemnify the Person against
the liability.
5.22 Compensation; Expenses of Directors. No Member or Director shall receive any salary,
fee, or draw for services
rendered to or on behalf of the Company merely by virtue of their status as a Member or Director,
it being the intention that, irrespective of any personal interest of any of the Directors, the
Directors shall have authority to establish reasonable compensation of all Directors for services
to the Company as Directors, Officers, or otherwise. Except as otherwise approved by or pursuant
to a policy approved by the Directors, no Member or Director shall be reimbursed for any expenses
incurred by such Member or Director on behalf of the Company. Notwithstanding the foregoing, by
resolution by the Directors, the Directors may be paid as reimbursement therefor, their expenses,
if any, of attendance at each meeting of the Directors. In addition, the Directors, by resolution,
may approve from time to time, the salaries and other compensation packages of the Officers of the
Company.
5.23 Loans. Any Member or Affiliate may, with the consent of the Directors, lend or
advance money to the Company. If any Member or Affiliate shall make any loan or loans to the
Company or advance money on its behalf, the amount of any such loan or advance shall not be treated
as a contribution to the capital of the Company but shall be a debt due from the Company. The
amount of any such loan or advance by a lending Member or Affiliate shall be repayable out of the
Company’s cash and shall bear interest at a rate not in excess of the prime rate established, from
time to time, by any major bank selected by the Directors for loans to its most creditworthy
commercial borrowers, plus four percent (4%) per annum. If a Director, or
22
any Affiliate of a
Director, is the lending Member, the rate of interest and the terms and conditions of such loan
shall be no less favorable to the Company than if the lender had been an independent third party.
None of the Members or their Affiliates shall be obligated to make any loan or advance to the
Company.
SECTION 6. ROLE OF MEMBERS
6.1 One Membership Class. There shall initially be one class of Membership Interests and
one class of Units.
6.2 Members. Each Person who desires to become a Member must complete and execute a
signature page to this Agreement in the form of Exhibit “C” attached hereto and such other
documents as may be required by the Directors. Each prospective Member must be approved and
admitted to the Company by the Board of Directors. The Membership Interests of the Members shall
be set forth on the Membership Register as maintained by the Company at its principal office and by
this reference is incorporated herein.
6.3 Additional Members. No Person shall become a Member without the approval of the
Directors. The Directors may refuse to admit any Person as a Member in their sole discretion. Any
such admission must comply with the requirements described in this Agreement and will be effective
only after such Person has executed and delivered to the Company such documentation as determined
by the Directors to be necessary and appropriate to effect such admission including the Member’s
agreement to be bound by this Agreement. Upon the admission of a Member the Directors shall cause
the Membership Register to be appropriately amended. Such amendments shall not be considered
amendments pursuant to Section 8.1 of this Agreement and will not require Member action for
purposes of Section 8.1.
6.4 Rights or Powers. Except as otherwise expressly provided for in this Agreement, the
Members shall not have any right or power to take part in the management or control of the Company
or its business and affairs or to act for or bind the Company in any way.
6.5 Voting Rights of Members. The Members shall have voting rights as defined by the
Membership Voting Interest of such Member and in accordance with the provisions of this Agreement.
Members do not have a right to cumulate their votes for any matter entitled to a vote of the
Members, including election of Directors.
6.6 Member Meetings. Meetings of the Members shall be called by the Directors, and shall
be held at the principal office of the Company or at such other place as shall be designated by the
person calling the meeting. Members representing an aggregate of not less than thirty percent
(30%) of the Membership Voting Interests may also in writing demand that the Directors call a
meeting of the Members. Regular meetings of the Members shall be held not less than once per
Fiscal Year.
6.7 Conduct of Meetings. Subject to the discretion of the Directors, the Members may
participate in any meeting of the Members by means of telephone conference or similar means of
23
communication by which all persons participating in the meeting can simultaneously hear and speak
with each other.
6.8 Notice of Meetings; Waiver. Notice of the meeting, stating the place, day and hour of
the meeting, shall be given to each Member in accordance with Section 11.1 hereof at least twenty
(20) days and no more than sixty (60) days before the day on which the meeting is to be held. A
Member may waive the notice of meeting required hereunder by written notice of waiver signed by the
Member whether given before, during or after the meeting. Attendance by a Member at a meeting is
waiver of notice of that meeting, unless the Member objects at the beginning of the meeting to the
transaction of business because the meeting is not lawfully called or convened and thereafter does
not participate in the meeting.
6.9 Quorum and Proxies. The presence (in person or by proxy or mail ballot) of Members
representing an aggregate of at least twenty-five percent (25%) of the Membership Voting Interests
is required for the transaction of business at a meeting of the Members. Voting by proxy or by
mail ballot shall be permitted on any matter if authorized by the Directors.
6.10 Voting; Action by Members. If a quorum is present, the affirmative vote of a majority
of the Membership Voting Interests represented at a meeting of the Members (in person, by proxy, or
by mail ballot) and entitled to vote on the matter shall constitute the act of the Members, unless
the vote of a greater or lesser proportion or numbers is otherwise required by this Agreement.
6.11 Record Date. For the purpose of determining Members entitled to notice of or to vote
at any meeting of Members or any adjournment of the meeting, or
Members entitled to receive payment of any distribution, or to make a determination of Members for
any other purpose, the date on which notice of the meeting is mailed (or otherwise delivered) or
the date on which the resolution declaring the distribution is adopted, as the case may be, shall
be the record date for determination of Members.
6.12 Termination of Membership. The membership of a Member in the Company shall terminate
upon the occurrence of events described in the Act, including resignation and withdrawal. If for
any reason the membership of a Member is terminated, the Member whose membership has terminated
loses all Membership Voting Interests and shall be considered merely as Assignee of the Membership
Economic Interest owned before the termination of membership, having only the rights of an
unadmitted Assignee provided for in Section 9.7 hereof.
6.13 Continuation of the Company. The Company shall not be dissolved upon the occurrence
of any event that is deemed to terminate the continued membership of a Member. The Company’s
affairs shall not be required to be wound up. The Company shall continue without dissolution.
6.14 No Obligation to Purchase Membership Interest. No Member whose membership in the
Company terminates, nor any transferee of such Member, shall have any right to demand or receive a
return of such terminated Member’s Capital Contributions or to require the purchase or redemption
of the Member’s Membership Interest. The other Members and the Company shall
24
not have any
obligation to purchase or redeem the Membership Interest of any such terminated Member or
transferee of any such terminated Member.
6.15 Waiver of Dissenters Rights. Each Member hereby disclaims, waives and agrees, to the
fullest extent permitted by law or the Act, not to assert dissenters’ or similar rights under the
Act.
6.16 Limitation on Ownership. Notwithstanding any other provision herein, subsequent to the
close of the Company’s initial registered offering no Member shall directly or indirectly own or
control more than forty percent (40%) of the issued and outstanding Units at any time. Units under
indirect ownership or control by a Member shall include Units owned or controlled by such Member’s
Related Parties, Subsidiaries and Affiliates. For purposes of this Section 6.16, the offering will
close upon the earliest occurrence of any of the following: (1) the Company’s acceptance of
subscriptions for units equaling the maximum amount as set forth in the Company’s registration
statement; (2) one year from the effective date of the Company’s initial registration statement; or
(3) the Company’s decision to close any time after the acceptance of subscriptions for units
equaling the minimum amount as set forth in the Company’s registration statement.
SECTION 7. ACCOUNTING, BOOKS AND RECORDS
7.1 Accounting, Books and Records. The books and records of the Company shall be kept, and
the financial position and the results of its operations recorded, in accordance with GAAP. The
books and records shall reflect all the Company transactions and shall be appropriate and adequate
for the Company’s business. The Company shall maintain at its principal office all of the
following: (i) A current list of the full name and last known business or residence address of each
Member and Assignee set forth in alphabetical order, together with the Capital Contributions,
Capital Account and Units of each Member and Assignee; (ii) The full name and business address of
each Director; (iii) A copy of the Articles and any and all amendments thereto together with
executed copies of any powers of attorney pursuant to which the Articles or any amendments thereto
have been executed; (iv) Copies of the Company’s federal, state, and local income tax or
information returns and reports, if any, for the six most recent taxable years; (v) A copy of this
Agreement and any and all amendments thereto together with executed copies of any powers of
attorney pursuant to which this Agreement or any amendments thereto have been executed; and (vi)
Copies of the financial statements of the Company, if any, for the six most recent Fiscal Years.
The Company shall use the accrual method of accounting in preparation of its financial reports and
for tax purposes and shall keep its books and records accordingly.
7.2 Delivery to Members and Inspection. Any Member or its designated representative shall
have reasonable access during normal business hours to the information and documents kept by the
Company pursuant to Section 7.1. The rights granted to a Member pursuant to this Section 7.2 are
expressly subject to compliance by such Member with the safety, security and
25
confidentiality
procedures and guidelines of the Company, as such procedures and guidelines may be established from
time to time. Upon the request of any Member for purposes reasonably related to the interest of
that Person as a Member, the Directors shall promptly deliver to the requesting Member, at the
expense of the requesting Member, a copy of the information required to be maintained under Section
7.1. Each Member has the right, upon reasonable request for purposes reasonably related to the
interest of the Person as a Member and for proper purposes, to: (i) inspect and copy during normal
business hours any of the Company records described in Section 7.1; and (ii) obtain from the
Directors, promptly after their becoming available, a copy of the Company’s federal, state, and
local income tax or information returns for each Fiscal Year. Each Assignee shall have the right
to information regarding the Company only to the extent required by the Act.
7.3 Reports. The chief financial officer of the Company shall be responsible for causing
the preparation of financial reports of the Company and the coordination of financial matters of
the Company with the Company’s accountants. The Company shall cause to be delivered to each Member
the financial statements listed below, prepared, in each case (other than with respect to Member’s
Capital Accounts, which shall be prepared in accordance with this Agreement) in accordance with
GAAP consistently applied. Delivery of the financial statements shall occur as soon as practicable
following the end of each Fiscal Year (and in any event not later than one hundred and twenty (120)
days after the end of such Fiscal Year) and at such time as distributions are made to the Unit
Holders pursuant to Section 10 hereof following
the occurrence of a Dissolution Event. The financial statements shall consist of a balance sheet
of the Company as of the end of such Fiscal Year and the related statements of operations, Unit
Holders’ Capital Accounts and changes therein, and cash flows for such Fiscal Year, together with
appropriate notes to such financial statements and supporting schedules, all of which shall be
audited and certified by the Company’s accountants, and in each case, to the extent the Company was
in existence, setting forth in comparative form the corresponding figures for the immediately
preceding Fiscal Year end (in the case of the balance sheet) and the two (2) immediately preceding
Fiscal Years (in the case of the statements). For purposes of this paragraph, public access to the
financial statements through either the Company’s or the Securities and Exchange Commission’s
website shall constitute delivery pursuant to this Section 7.3.
7.4 Tax Matters. The Directors shall, without any further consent of the Unit Holders
being required (except as specifically required herein), make any and all elections for federal,
state, local, and foreign tax purposes as the Directors shall determine appropriate and represent
the Company and the Unit Holders before taxing authorities or courts of competent jurisdiction in
tax matters affecting the Company or the Unit Holders in their capacities as Unit Holders, and to
file any tax returns and execute any agreements or other documents relating to or affecting such
tax matters, including agreements or other documents that bind the Unit Holders with respect to
such tax matters or otherwise affect the rights of the Company and the Unit Holders. The Directors
shall designate a Person to be specifically authorized to act as the “Tax Matters Member” under the
Code and in any similar capacity under state or local law; provided, however, that the Directors
shall have the authority to designate, remove and replace the Tax Matters Member who shall act as
the tax matters partner within the meaning of and pursuant to Regulations Sections 301.6231(a)(7)-1
and -2 or any similar provision under state or local law.
26
Necessary tax information shall be
delivered to each Unit Holder as soon as practicable after the end of each Fiscal Year of the
Company but not later than three (3) months after the end of each Fiscal Year.
SECTION 8. AMENDMENTS
8.1 Amendments. Amendments to this Agreement may be proposed by the Board of Directors or
upon delivery of a written petition signed and dated by Members holding at least five percent (5%)
of the then outstanding Units of the Company. Delivery of the signed petition must be made by
personal delivery by one of the signing Members, or by United States mail, postage prepaid, to the
Secretary of the Company. Each such petition delivered to the Secretary shall set forth the name
and address of each signing Member, a representation of the number of record Units of which each
Member holds, and must clearly set forth the Amendment which the signing Members are seeking. The
Board of Directors shall submit to the Members a verbatim statement of any proposed amendment,
providing that counsel for the Company shall have approved of the same in writing as to form, and
the Board of Directors shall include in any such submission a recommendation as to the proposed
amendment. The Board of Directors shall seek the written vote of the Members on the proposed
amendment or shall call a meeting to vote thereon and to transact any other business that it may
deem appropriate. Except as otherwise provided under this Agreement, a proposed amendment shall be
adopted and be effective as an amendment hereto only if approved by an
action of the Members pursuant to Section 6.10 of this Agreement. Notwithstanding any provision of
this Section 8.1 to the contrary, this Agreement shall not be amended without the consent of each
Member adversely affected if such amendment would modify the limited liability of a Member.
SECTION 9. TRANSFERS
9.1 Restrictions on Transfers. Except as otherwise permitted by this Agreement, no Member
shall Transfer all or any portion of its Units. In the event that any Member pledges or otherwise
encumbers all or any part of its Units as security for the payment of a Debt, 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 of the terms and conditions of this Section 9. In the
event such pledgee or secured party becomes the Unit Holder hereunder pursuant to the exercise of
such party’s rights under such pledge or hypothecation agreement, such pledgee or secured party
shall be bound by all terms and conditions of this Second Amended and Restated Operating Agreement
and all other agreements governing the rights and obligations of Unit Holders. In such case, such
pledgee or secured party, and any transferee or purchaser of the Units held by such pledgee or
secured party, shall not have any Membership Voting Interest attached to such Units unless and
until the Directors have approved in writing and admitted as a Member hereunder, such pledgee,
secured party, transferee or purchaser of such Units.
9.2 Permitted Transfers. Subject to the conditions and restrictions set forth in this
Section 9, a Unit Holder may:
(a) at any time Transfer all or any portion of its Units:
27
(i) | to the transferor’s administrator or trustee to whom such Units are transferred involuntarily by operation of law or judicial decree, or; | ||
(ii) | without consideration to or in trust for descendants or the spouse of a Member; and |
(b) at any time following the date on which substantial operations of the Facilities
commences, Transfer all or any portion of its Units:
(i) | to any Person approved by the Directors in writing, | ||
(ii) | to any other Member or to any Affiliate or Related Party of another Member; or | ||
(iii) | to any Affiliate or Related Party of the transferor. |
Any such Transfer set forth in this Section 9.2 and meeting the conditions set forth in Section 9.3
below is referred to in this Agreement as a “Permitted Transfer.”
9.3 Conditions Precedent to Transfers. In addition to the conditions set forth above, no
Transfer of a Membership Interest shall be effective unless and until all of the following
conditions have been satisfied:
(a) Except in the case of a Transfer involuntarily by operation of law, the transferor and
transferee shall execute and deliver to the Company such documents and instruments of Transfer as
may be necessary or appropriate in the opinion of counsel to the Company to effect such Transfer.
In the case of a Transfer of Units involuntarily by operation of law, the Transfer shall be
confirmed by presentation to the Company of legal evidence of such Transfer, in form and substance
satisfactory to counsel to the Company. In all cases, the transferor and/or transferee shall pay
all reasonable costs and expenses connected with the Transfer and the admission of the Transferee
as a Member and incurred as a result of such Transfer, including but not limited to, legal fees and
costs.
(b) The transferor and transferee shall furnish the Company with the transferee’s taxpayer
identification number, sufficient information to determine the transferee’s initial tax basis in
the Units transferred, and any other information reasonably necessary to permit the Company to file
all required federal and state tax returns and other legally required information statements or
returns. Without limiting the generality of the foregoing, the Company shall not be required to
make any distribution otherwise provided for in this Agreement with respect to any transferred
Units until it has received such information.
(c) Except in the case of a Transfer of any Units involuntarily by operation of law, either
(i) such Units shall be registered under the Securities Act, and any applicable state securities
laws, or (ii) the transferor shall provide an opinion of counsel, which opinion and counsel shall
be reasonably satisfactory to the Directors, to the effect that such Transfer is exempt from all
applicable registration requirements and that such Transfer will not violate any applicable laws
regulating the Transfer of securities.
28
(d) Except in the case of a Transfer of Units involuntarily by operation of law, the
transferor shall provide an opinion of counsel, which opinion and counsel shall be reasonably
satisfactory to the Directors, to the effect that such Transfer will not cause the Company to be
deemed to be an “investment company” under the Investment Company Act of 1940.
(e) Unless otherwise approved by the Directors and Members representing in the aggregate a 75%
super majority of the Membership Voting Interests, no Transfer of Units shall be made except upon
terms which would not, in the opinion of counsel chosen by and mutually acceptable to the Directors
and the transferor Member, result in the termination of the Company within the meaning of Section
708 of the Code or cause the application of the rules of Sections 168(g)(1)(B) and 168(h) of the
Code or similar rules to apply to the Company. If the immediate Transfer of such Unit would, in
the opinion of such counsel, cause a termination within the meaning of Section 708 of the Code,
then if, in the opinion of such counsel, the following action would not precipitate such
termination, the transferor Member shall be entitled to (or required, as the case may be) (i)
immediately Transfer only that portion of its Units as may, in the opinion of such counsel, be
transferred without causing such a termination and (ii) enter into an agreement to Transfer the
remainder of its Units, in one or more Transfers, at the earliest date or dates on which such
Transfer or Transfers may be effected without causing such termination. The purchase price for the
Units shall be allocated between the immediate Transfer and the deferred Transfer or Transfers pro
rata on the basis of the percentage of the aggregate Units being
transferred, each portion to be payable when the respective Transfer is consummated, unless
otherwise agreed by the parties to the Transfer. In the case of a Transfer by one Member to
another Member, the deferred purchase price shall be deposited in an interest-bearing escrow
account unless another method of securing the payment thereof is agreed upon by the transferor
Member and the transferee Member(s).
(f) No notice or request initiating the procedures contemplated by Section 9.3 may be given by
any Member after a Dissolution Event has occurred. No Member may sell all or any portion of its
Units after a Dissolution Event has occurred.
(g) No Person shall Transfer any Unit if, in the determination of the Directors, such Transfer
would cause the Company to be treated as a “publicly traded partnership” within the meaning of
Section 7704(b) of the Code.
The Directors shall have the authority to waive any legal opinion or other condition required in
this Section 9.3 other than the Member approval requirement set forth in Section 9.3(e).
9.4 Prohibited Transfers. Any purported Transfer of Units that is not permitted under this
Section shall be null and void and of no force or effect whatsoever; provided that, if the Company
is required to recognize such a Transfer (or if the Directors, in their sole discretion, elect to
recognize such a Transfer), the Units Transferred shall be strictly limited to the transferor’s
Membership Economic Interests as provided by this Agreement with respect to the transferred Units,
which Membership Economic Interests may be applied (without limiting any other legal or equitable
rights of the Company) to satisfy any debts, obligations, or liabilities for damages that the
transferor or transferee of such Interest may have to the Company. In the case of a Transfer or
attempted Transfer of Units that is not permitted under this Section, the parties
29
engaging or
attempting to engage in such Transfer shall be liable to indemnify and hold harmless the Company
and the other Members from all cost, liability, and damage that any of such indemnified Members may
incur (including, without limitation, incremental tax liabilities, lawyers’ fees and expenses) as a
result of such Transfer or attempted Transfer and efforts to enforce the indemnity granted hereby.
9.5 No Dissolution or Termination. The transfer of a Membership Interest pursuant to the
terms of this Article shall not dissolve or terminate the Company. No Member shall have the right
to have the Company dissolved or to have such Member’s Capital Contribution returned except as
provided in this Agreement.
9.6 Prohibition of Assignment. Notwithstanding the foregoing provisions of this Article,
Transfer of a Membership Interest may not be made if the Membership Interest sought to be sold,
exchanged or transferred, when added to the total of all other Membership Interests sold, exchanged
or transferred within the period of twelve (12) consecutive months prior thereto, would result in
the termination of the Company under Section 708 of the Internal Revenue Code. In the event of a
transfer of any Membership Interests, the Members will determine, in their sole discretion, whether
or not the Company will elect pursuant to Section 754 of the Internal Revenue Code (or
corresponding provisions of future law) to adjust the basis of the assets of the Company.
9.7 Rights of Unadmitted Assignees. A Person who acquires Units but who is not admitted as
a substituted Member pursuant to Section 9.8 hereof shall be entitled only to the Membership
Economic Interests with respect to such Units in accordance with this Agreement, and shall not be
entitled to the Membership Voting Interest with respect to such Units. In addition, such Person
shall have no right to any information or accounting of the affairs of the Company, shall not be
entitled to inspect the books or records of the Company, and shall not have any of the rights of a
Member under the Act or this Agreement.
9.8 Admission of Substituted Members. As to Permitted Transfers, a transferee of Units
shall be admitted as a substitute Member provided that such transferee has complied with the
following provisions: (a) The transferee of Units shall, by written instrument in form and
substance reasonably satisfactory to the Directors; (i) accept and adopt the terms and provisions
of this Agreement, including this Section 9, and (ii) assume the obligations of the transferor
Member under this Agreement with respect to the transferred Units. The transferor Member shall be
released from all such assumed obligations except (x) those obligations or liabilities of the
transferor Member arising out of a breach of this Agreement, (y) in the case of a Transfer to any
Person other than a Member or any of its Affiliates, those obligations or liabilities of the
transferor Member based on events occurring, arising or maturing prior to the date of Transfer, and
(z) in the case of a Transfer to any of its Affiliates, any Capital Contribution or other financing
obligation of the transferor Member under this Agreement; (b) The transferee pays or reimburses the
Company for all reasonable legal, filing, and publication costs that the Company incurs in
connection with the admission of the transferee as a Member with respect to the Transferred Units;
and (c) Except in the case of a Transfer involuntarily by operation of law, if required by the
Directors, the transferee (other than a transferee that was a Member prior to the Transfer) shall
deliver to the Company evidence of the authority of such Person to become a
30
Member and to be bound
by all of the terms and conditions of this Agreement, and the transferee and transferor shall each
execute and deliver such other instruments as the Directors reasonably deem necessary or
appropriate to effect, and as a condition to, such Transfer.
9.9 Representations Regarding Transfers.
(a) Each Member hereby covenants and agrees with the Company for the benefit of the Company
and all Members, that (i) it is not currently making a market in Units and will not in the future
make a market in Units, (ii) it will not Transfer its Units on an established securities market, a
secondary market (or the substantial equivalent thereof) within the meaning of Code Section 7704(b)
(and any Regulations, proposed Regulations, revenue rulings, or other official pronouncements of
the Internal Revenue Service or Treasury Department that may be promulgated or published
thereunder), and (iii) in the event such Regulations, revenue rulings, or other pronouncements
treat any or all arrangements which facilitate the selling of Company interests and which are
commonly referred to as “matching services” as being a secondary market or substantial equivalent
thereof, it will not Transfer any Units through a matching service that is not approved in advance
by the Company. Each Member further agrees that it will not Transfer any Units to any Person unless such Person agrees to be bound by this Section 9
and to Transfer such Units only to Persons who agree to be similarly bound.
(b) Each Member hereby represents and warrants to the Company and the Members that such
Member’s acquisition of Units hereunder is made as principal for such Member’s own account and not
for resale or distribution of such Units. Each Member further hereby agrees that the following
legend, as the same may be amended by the Directors in their sole discretion, may be placed upon
any counterpart of this Agreement, the Articles, or any other document or instrument evidencing
ownership of Units:
THE TRANSFERABILITY OF THE COMPANY UNITS REPRESENTED BY THIS DOCUMENT IS RESTRICTED. SUCH UNITS
MAY NOT BE SOLD, ASSIGNED, OR TRANSFERRED, NOR WILL ANY ASSIGNEE, VENDEE, TRANSFEREE, OR ENDORSEE
THEREOF BE RECOGNIZED AS HAVING ACQUIRED ANY SUCH UNITS FOR ANY PURPOSES, UNLESS AND TO THE EXTENT
SUCH SALE, TRANSFER, HYPOTHECATION, OR ASSIGNMENT IS PERMITTED BY, AND IS COMPLETED IN STRICT
ACCORDANCE WITH, THE TERMS AND CONDITIONS SET FORTH IN THE SECOND AMENDED AND RESTATED OPERATING
AGREEMENT AND AGREED TO BY EACH MEMBER.
THE UNITS REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD, OFFERED FOR SALE, OR TRANSFERRED IN
ABSENCE OF AN EFFECTIVE REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND UNDER
APPLICABLE STATE SECURITIES LAWS.
9.10 Distribution and Allocations in Respect of Transferred Units. If any Units are
Transferred during any Fiscal Year in compliance with the provisions of this Section 9, Profits,
Losses, each item thereof, and all other items attributable to the Transferred Units for such
Fiscal Year shall be divided and allocated between the transferor and the transferee by taking into
31
account their varying interests during the Fiscal Year in accordance with Code Section 706(d),
using any conventions permitted by law and selected by the Directors. All distributions on or
before the date of such Transfer shall be made to the transferor, and all distributions thereafter
shall be made to the transferee. Solely for purposes of making such allocations and distributions,
the Company shall recognize such Transfer to be effective as of the first day of the month
following the month in which all documents to effectuate the transfer have been executed and
delivered to the Company, provided that, if the Company does not receive a notice stating the date
such Units were transferred and such other information as the Directors may reasonably require
within thirty (30) days after the end of the Fiscal Year during which the Transfer occurs, then all
such items shall be allocated, and all distributions shall be made, to the Person who, according to
the books and records of the Company, was the owner of the Units on the last day of such Fiscal
Year. Neither the Company nor any Member shall incur any liability for making allocations and
distributions in accordance with the provisions of this Section 9.10, whether or not the Directors
or the Company has knowledge of any Transfer of ownership of any Units.
9.11 Additional Members. Additional Members may be admitted from time to time upon the
approval of the Directors. Any such additional Member shall pay such purchase price for
his/her/its Membership Interest and shall be admitted in accordance with such terms and conditions,
as the Directors shall approve. All Members acknowledge that the admission of additional Members
may result in dilution of a Member’s Membership Interest. Prior to the admission of any Person as
a Member, such Person shall agree to be bound by the provisions of this Agreement and shall sign
and deliver an Addendum to this Agreement in the form of Exhibit C, attached hereto. Upon
execution of such Addendum, such additional Members shall be deemed to be parties to this Agreement
as if they had executed this Agreement on the original date hereof, and, along with the parties to
this Agreement, shall be bound by all the provisions hereof from and after the date of execution
hereof. The Members hereby designate and appoint the Directors to accept such additional Members
and to sign on their behalf any Addendum in the form of Exhibit C, attached hereto.
SECTION 10. DISSOLUTION AND WINDING UP
10.1 Dissolution. The Company shall dissolve and shall commence winding up and liquidating
upon the first to occur of any of the following (each a “Dissolution Event”): (i) The affirmative
vote of a 75% super majority in interest of the Membership Voting Interests to dissolve, wind up,
and liquidate the Company; or (ii) The entry of a decree of judicial dissolution pursuant to the
Act. The Members hereby agree that, notwithstanding any provision of the Act, the Company shall
not dissolve prior to the occurrence of a Dissolution Event.
10.2 Winding Up. Upon the occurrence of a Dissolution Event, the Company shall continue
solely for the purposes of winding up its affairs in an orderly manner, liquidating its assets, and
satisfying the claims of its creditors and Members, and no Member shall take any action that is
inconsistent with, or not necessary to or appropriate for, the winding up of the Company’s business
and affairs, PROVIDED that all covenants contained in this Agreement and obligations provided for
in this Agreement shall continue to be fully binding upon the Members until such time as the
Property has been distributed pursuant to this Section 10.2 and the Articles have been canceled
pursuant to the Act. The Liquidator shall be responsible for overseeing the prompt and
32
orderly
winding up and dissolution of the Company. The Liquidator shall take full account of the Company’s
liabilities and Property and shall cause the Property or the proceeds from the sale thereof (as
determined pursuant to Section 10.8 hereof), to the extent sufficient therefor, to be applied and
distributed, to the maximum extent permitted by law, in the following order: (a) First, to
creditors (including Members and Directors who are creditors, to the extent otherwise permitted by
law) in satisfaction of all of the Company’s Debts and other liabilities (whether by payment or the
making of reasonable provision for payment thereof), other than liabilities for which reasonable
provision for payment has been made; and (b) Second, except as provided in this Agreement, to
Members in satisfaction of liabilities for distributions pursuant to the Act; (c) Third, the
balance, if any, to the Unit Holders in accordance with the positive balance in their Capital
Accounts calculated after making the required adjustment set forth in clause (t) of the definition
of Gross Asset Value in Section 1.10 of this Agreement, after giving effect to all contributions, distributions and
allocations for all periods.
10.3 Compliance with Certain Requirements of Regulations; Deficit Capital Accounts. In the
event the Company is “liquidated” within the meaning of Regulations Section 1.704-1(b)(2)(ii)(g),
distributions shall be made pursuant to this Section 10 to the Unit Holders who have positive
Capital Accounts in compliance with Regulations Section 1.704-1(b)(2)(ii)(b)(2). If any Unit
Holder has a deficit balance in his Capital Account (after giving effect to all contributions,
distributions and allocations for all Fiscal Years, including the Fiscal Year during which such
liquidation occurs), such Unit Holder shall have no obligation to make any contribution to the
capital of the Company with respect to such deficit, and such deficit shall not be considered a
debt owed to the Company or to any other Person for any purpose whatsoever. In the discretion of
the Liquidator, a pro rata portion of the distributions that would otherwise be made to the Unit
Holders pursuant to this Section 10 may be: (a) Distributed to a trust established for the benefit
of the Unit Holders for the purposes of liquidating Company assets, collecting amounts owed to the
Company, and paying any contingent or unforeseen liabilities or obligations of the Company. The
assets of any such trust shall be distributed to the Unit Holders from time to time, in the
reasonable discretion of the Liquidator, in the same proportions as the amount distributed to such
trust by the Company would otherwise have been distributed to the Unit Holders pursuant to Section
10.2 hereof; or (b) Withheld to provide a reasonable reserve for Company liabilities (contingent or
otherwise) and to reflect the unrealized portion of any installment obligations owed to the
Company, provided that such withheld amounts shall be distributed to the Unit Holders as soon as
practicable.
10.4 Deemed Distribution and Recontribution. Notwithstanding any other provision of this
Section 10, in the event the Company is liquidated within the meaning of Regulations Section
1.704-1(b)(2)(ii)(g) but no Dissolution Event has occurred, the Property shall not be liquidated,
the Company’s Debts and other liabilities shall not be paid or discharged, and the Company’s
affairs shall not be wound up.
10.5 Rights of Unit Holders. Except as otherwise provided in this Agreement, each Unit
Holder shall look solely to the Property of the Company for the return of its Capital Contribution
and has no right or power to demand or receive Property other than cash from the Company. If the
assets of the Company remaining after payment or discharge of the debts or liabilities of the
33
Company are insufficient to return such Capital Contribution, the Unit Holders shall have no
recourse against the Company or any other Unit Holder or Directors.
10.6 Allocations During Period of Liquidation. During the period commencing on the first
day of the Fiscal Year during which a Dissolution Event occurs and ending on the date on which all
of the assets of the Company have been distributed to the Unit Holders pursuant to Section 10.2
hereof (the “Liquidation Period”), the Unit Holders shall continue to share Profits, Losses, gain,
loss and other items of Company income, gain, loss or deduction in the manner provided in Section 3
hereof.
10.7 Character of Liquidating Distributions. All payments made in liquidation of the
interest of a Unit Holder in the Company shall be made in exchange for the interest of such Unit
Holder in Property pursuant to Section 736(b)(1) of the Code, including the interest of such Unit
Holder in Company goodwill.
10.8 The Liquidator. The “Liquidator” shall mean a Person appointed by the Directors(s) to
oversee the liquidation of the Company. Upon the consent of a majority in interest of the Members,
the Liquidator may be the Directors. The Company is authorized to pay a reasonable fee to the
Liquidator for its services performed pursuant to this Section 10 and to reimburse the Liquidator
for its reasonable costs and expenses incurred in performing those services. The Company shall
indemnify, save harmless, and pay all judgments and claims against such Liquidator or any officers,
Directors, agents or employees of the Liquidator relating to any liability or damage incurred by
reason of any act performed or omitted to be performed by the Liquidator, or any officers,
Directors, agents or employees of the Liquidator in connection with the liquidation of the Company,
including reasonable attorneys’ fees incurred by the Liquidator, officer, Director, agent or
employee in connection with the defense of any action based on any such act or omission, which
attorneys’ fees may be paid as incurred, except to the extent such liability or damage is caused by
the fraud, intentional misconduct of, or a knowing violation of the laws by the Liquidator which
was material to the cause of action.
10.9 Forms of Liquidating Distributions. For purposes of making distributions required by
Section 10.2 hereof, the Liquidator may determine whether to distribute all or any portion of the
Property in-kind or to sell all or any portion of the Property and distribute the proceeds
therefrom.
SECTION 11. MISCELLANEOUS
11.1 Notices. Any notice, payment, demand, or communication required or permitted to be
given by any provision of this Agreement shall be in writing and shall be deemed to have been
delivered, given, and received for all purposes (i) if delivered personally to the Person or to an
officer of the Person to whom the same is directed, or (ii) when the same is actually received, if
sent by regular or certified mail, postage and charges prepaid, or (iii) if sent by facsimile,
email, or other electronic transmission, when such transmission is electronically confirmed as
having been successfully transmitted. If sent by registered or certified mail, then the notice,
payment, demand or communication must be addressed as follows: (a) If to the Company, to the
address
34
determined pursuant to Section 1.4 hereof; (b) If to the Directors, to the address set
forth on record with the Company; (c) If to a Member, either to the address set forth in Section
2.1 hereof or to such other address that has been provided in writing to the Company.
11.2 Binding Effect. Except as otherwise provided in this Agreement, every covenant, term,
and provision of this Agreement shall be binding upon and inure to the benefit of the Members and
their respective successors, transferees, and assigns.
11.3 Construction. Every covenant, term, and provision of this Agreement shall be
construed simply according to its fair meaning and not strictly for or against any Member.
11.4 Headings. Section and other headings contained in this Agreement are for reference
purposes only and are not intended to describe, interpret, define, or limit the scope, extent, or
intent of this Agreement or any provision hereof.
11.5 Severability. Except as otherwise provided in the succeeding sentence, every
provision of this Agreement is intended to be severable, and, if any term or provision of this
Agreement is illegal or invalid for any reason whatsoever, such illegality or invalidity shall not
affect the validity or legality of the remainder of this Agreement. The preceding sentence of this
Section 11.5 shall be of no force or effect if the consequence of enforcing the remainder of this
Agreement without such illegal or invalid term or provision would be to cause any Member to lose
the material benefit of its economic bargain.
11.6 Incorporation By Reference. Every exhibit, schedule, and other appendix attached to
this Agreement and referred to herein is incorporated in this Agreement by reference unless this
Agreement expressly otherwise provides.
11.7 Variation of Terms. All terms and any 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.
11.8 Governing Law. The laws of the State of Georgia shall govern the validity of this
Agreement, the construction of its terms, and the interpretation of the rights and duties arising
hereunder.
11.9 Waiver of Jury Trial. Each of the Members irrevocably waives to the extent permitted
by law, all rights to trial by jury in any action, proceeding or counterclaim arising out of or
relating to this Agreement.
11.10 Counterpart Execution. This Agreement may be executed in any number of counterparts
with the same effect as if all of the Members had signed the same document. All counterparts shall
be construed together and shall constitute one agreement.
11.11 Specific Performance. Each Member agrees with the other Members that the other
Members would be irreparably damaged if any of the provisions of this Agreement are not performed
in accordance with their specific terms and that monetary damages would not provide
35
an adequate
remedy in such event. Accordingly, it is agreed that, in addition to any other remedy to which the
nonbreaching Members may be entitled, at law or in equity, the nonbreaching Members shall be
entitled to injunctive relief to prevent breaches of the provisions of this Agreement and
specifically to enforce the terms and provisions hereof in any action instituted in any court of
the United States or any state thereof having subject matter jurisdiction thereof.
IN WITNESS WHEREOF, the parties have executed and entered into this Second Amended and Restated
Operating Agreement of the Company as of the date first set forth above.
COMPANY:
FIRST UNITED ETHANOL, LLC
By:
|
/s/ Xxxxxx Xxxxxxxx | |||
Xxxxxx Xxxxxxxx, Chairman |
36
EXHIBIT “A”
Name and Address of Initial Members | Units | |
Miley Xxxxx |
||
0000 Xxx Xxxxxxx Xxxxxxx 0 |
||
Xxxxxxx, Xxxxxxx 00000 |
000 | |
Xxxxxx Xxxxxxxx |
||
000 Xxxx Xxxxxx |
||
Xxxxxxx, Xxxxxxx 00000 |
000 | |
Xxxxxx Xxxxxxxx |
||
0000 Xxxxxxx 00 |
||
Xxxxxxx, Xxxxxxx 00000 |
100 | |
Xxxxx Xxxxxxx |
||
0000 Xxx Xxxxxxx Xxxxxxx 0 |
||
Xxxxxxx, Xxxxxxx 00000 |
100 | |
Cader X. Xxx III |
||
00000 Xxxxxxxxx Xxxx |
||
Xxxxxxx, Xxxxxxx 00000 |
000 | |
Xxxxx Xxxxxxxx |
||
X.X. Xxx 000 |
||
Xxxxxxx, Xxxxxxx 00000 |
100 | |
Xxxx “Bubba” Xxxxxxx |
||
0000 Xxxxxxx 00 |
||
Xxxxxxx, Xxxxxxx 00000 |
100 | |
X. Xxxxxx Xxxxxx, Jr. |
||
X.X. Xxx 000 |
||
Xxxxxxx, Xxxxxxx 00000 |
100 | |
Xxxxxx Xxxxxx |
||
0000 Xxx Xxxx Xxxx |
||
Xxxxxxx, Xxxxxxx 00000 |
100 | |
Xxxxx Xxxxxx |
||
000 X Xxxxx Xxxxx (X.X. Xxx 000) |
||
Xxxxxx, Xxxxxxx 00000 |
100 | |
Xxxx Xxxxxxxxx |
||
000 XX Xxx 000 |
||
Xxxxxxxx, Xxxxxxx 00000 |
80 |
37
Name and Address of Initial Members | Units | |
Xxxxxxx X. and Xxx X. Xxxx |
||
00 Xxxxxxxxxxx Xxxx |
||
Xxxxxxxxxxx, Xxxxxxx 00000 |
80 | |
Xxxxxxx X. Xxxxxxxx |
||
0000 00xx Xxxxxx X.X. |
||
Xxxxx, Xxxxxxx 00000 |
80 | |
Xxxx Xxxxxxx |
||
0000 Xxxxx Xxxxxx Xxxx |
||
Xxxxxxx, Xxxxxxx 00000 |
80 | |
Xxxxxxx Xxxxx XX |
||
X.X. Xxx 00 |
||
Xxxxxxxxxxx, Xxxxxxx 00000 |
80 | |
Xxxxx X. Xxxxxxx |
||
0000 Xxxxxxx Xxxx |
||
Xxxxxxxxx, Xxxxxxx 00000 |
80 | |
W. Xxxxx Xxxxxxxxx |
||
X.X. Xxx 000 |
||
Xxxxx, Xxxxxxx 00000 |
80 | |
Xxxxxx X. Xx. and Xxxxxxxx X. Xxxxxx |
||
0000 Xxx 000 X. |
||
Xxxxxxx, Xxxxxxx 00000 |
80 | |
Xxx Xxxxx Xxxxxxxx XX |
||
000 Xxxxxxx 000 |
||
Xxxxxxxxx, Xxxxxxx 00000 |
80 | |
Xxxxxx X. Xxxxx III |
||
RFD 1, Xxx 00 |
||
Xxxxxxxx, Xxxxxxx 00000 |
40 | |
X. Xxxxxx Xxxxxxx |
||
000 XX Xxx Xxxxxx (P.O. Box 306) |
||
Xxxxxx, Xxxxxxx 00000 |
80 | |
Xxxxxxx X. Xxxxxx Xx. |
||
Xx. 0 Xxx 000 |
||
Xxxxxxxxx, Xxxxxxx 00000 |
80 |
38
Name and Address of Initial Members | Units | |
Xxxx X. and Xxxxx X. Xxxxxxx |
||
0000 Xxxxxx-Xxxxxx Xxxxxxx Xxxx |
||
Xxxxxx, Xxxxxxx 00000 |
80 | |
Xxxx Xxxx |
||
0000 Xxxxxxx-Xxxx Xxxx Xxxx |
||
Xxxxxx, Xxxxxxx 00000 |
00 | |
Xxxxxx X. Xxxxxx |
||
000 Xxxxx Xxxxxxxxxx Xxxx |
||
Xxxxxx, Xxxxxxx 00000 |
40 | |
X. Xxxxx Xxxxx Xx. |
||
000 Xxxxxxxxx Xxxxx |
||
Xxxxxxx, Xxxxxxx 00000 |
60 | |
Trust, Xxxxx Xxxxxx Xx. |
||
000 Xxxxxxx Xxxx |
||
Xxxxxxxxxx, Xxxxxxx 00000 |
80 | |
Xxxxxxx X. Xxxx |
||
0000 Xxxxxxxxxx Xxxx |
||
Xxxxxx, Xxxxxxx 00000 |
40 | |
Southwest Georgia Oil Co., Inc. |
||
(Xxxxxxx Xxxxxx) |
||
X.X. Xxx 0000 |
||
Xxxxxxxxxx, Xxxxxxx 00000 |
80 | |
X.X. Xxxx Xx. |
||
Xx. 0 Xxx 0000 |
||
Xxxxxx, Xxxxxxx 00000 |
40 | |
Xxxxxx X. Dollar II |
||
0000 Xxxxxx Xxxx |
||
Xxxxxxxxxx, Xxxxxxx 00000 |
60 | |
Xxxxxxx X. Xxxxxx |
||
0000 Xxxxx Xxxxxx X.X. |
||
Xxxxxxxx, Xxxxxxx 00000 |
80 | |
W. Xxxxxx Xxxxxx |
||
Xx. 0 Xxx 0000 |
||
Xxxxxxx, Xxxxxxx 00000 |
40 | |
TOTAL: |
2,600 |
39
EXHIBIT “B”
Initial Board of Directors
Initial Board of Directors
Initial Board of Directors | Addresses of Initial Board of Directors | |
Miley Xxxxx
|
0000 Xxx Xx Xxx 0, Xxxxxxx, Xxxxxxx 00000 | |
Xxxxxx Xxxxxxxx
|
000 Xxxx Xxxxxx, Xxxxxxx, Xxxxxxx 00000 | |
Xxxxxx Xxxxxxxx
|
0000 Xxxxxxx 00, Xxxxxxx, Xxxxxxx 00000 | |
Xxxxx Xxxxxxx
|
0000 Xxx Xx Xxx 0, Xxxxxxx, Xxxxxxx 00000 | |
Xxxxx X. Xxxxxxxx
|
X.X. Xxx 000, Xxxxxxx, Xxxxxxx 00000 | |
Xxxx X. “Bubba” Xxxxxxx
|
0000 Xxxxxxx 00, Xxxxxxx, Xxxxxxx 00000 | |
Xxxxxx Xxxxxx
|
X.X. Xxx 000, Xxxxxxx, Xxxxxxx 00000 | |
Xxxxxx Xxxxxx
|
0000 Xxx Xxxx Xxxx, Xxxxxxx, Xxxxxxx 00000 | |
Xxxxx Dollar
|
X.X. Xxx 00, Xxxxxxxxxx, Xxxxxxx 00000 | |
Xxxxxxx X. Xxxxxxx
|
X.X. Xxx 0000, Xxxxxxxxxx, Xxxxxxx 00000 | |
Xxxxx Xxxx
|
0000 Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxx 00000 | |
Xxxxxx X. “Xxx” Xxxxxx , Sr.
|
0000 Xxx 000 X., Xxxxxxx, Xxxxxxx 00000 | |
Xxxx Xxxxxxxxx
|
000 XX Xxx 000, Xxxxxxxx, Xxxxxxx 00000 |
40
EXHIBIT “C”
MEMBER SIGNATURE PAGE
ADDENDA
TO THE
SECOND AMENDED AND RESTATED OPERATING AGREEMENT OF
FIRST UNITED ETHANOL, LLC
TO THE
SECOND AMENDED AND RESTATED OPERATING AGREEMENT OF
FIRST UNITED ETHANOL, LLC
The undersigned does hereby represent and warrant that the undersigned, as a condition to
becoming a Member in First United Ethanol, LLC, has received a copy of the Second Amended and
Restated Operating Agreement, dated April 5 , 2006 (“Operating Agreement”), and, if applicable, all
amendments and modifications thereto, and does hereby agree that the undersigned, along with the
other parties to the Operating Agreement, shall be subject to and comply with all terms and
conditions of said Operating Agreement in all respects as if the undersigned had executed said
Operating Agreement on the original date thereof and that the undersigned is and shall be bound by
all of the provisions of said Operating Agreement from and after the date of execution hereof.
Individuals: | Entities: | |
Name of Individual Member (Please Print)
|
Name of Entity (Please Print) | |
Signature of Individual
|
Print Name and Title of Officer | |
Name of Joint Individual Member (Please Print)
|
Signature of Officer | |
Agreed and accepted on behalf of the
Company and its Members:
Company and its Members:
FIRST UNITED ETHANOL, LLC
By:
|
||||
Its: |
||||
41