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EXHIBIT 10.17
LIMITED LIABILITY COMPANY AGREEMENT
OF
MMI PRODUCTS, L.L.C.
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Dated as of June 12, 1997
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TABLE OF CONTENTS
PAGE
ARTICLE I - GENERAL PROVISIONS; DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.1 Formation, Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.2 Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.3 Purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.4 Place of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.5 Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.6 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
ARTICLE II - MEMBERS AND RIGHTS OF MEMBERS AND OTHER UNITHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 2.1 Members . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 2.2 Voting Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 2.3 Conversion of Class B Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 2.4 Limitation of Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 2.5 No Right to Withdraw . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 2.6 Rights to Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 2.7 Remuneration to Members or Economic Owners . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 2.8 Exchange of Units for Interests in Portfolio Companies . . . . . . . . . . . . . . . . . . 19
ARTICLE III - CAPITAL CONTRIBUTIONS; CAPITAL ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 3.1 Capital Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 3.2 Capital Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 3.3 Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 3.4 No Withdrawal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 3.5 Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
ARTICLE IV - DISTRIBUTIONS AND ALLOCATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 4.1 Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 4.2 Allocations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 4.3 Special Allocations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 4.4 Tax Allocations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
Section 4.5 Curative Allocations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 4.6 Indemnification and Reimbursement for Payments on Behalf of a Unitholder . . . . . . . . . 27
ARTICLE V - MANAGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 5.1 Management Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 5.2 Directors of MMHC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 5.3 Indemnification of Each Member and Economic Owner . . . . . . . . . . . . . . . . . . . . . 29
Section 5.4 Heirs and Personal Representatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 5.5 Non-Exclusivity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
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Section 5.6 Transfer of Membership Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 5.7 Admission of New Members . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 5.8 Withdrawal, Expulsion or Other Termination of Members . . . . . . . . . . . . . . . . . . . 32
Section 5.9 Share of a Terminated Member . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 5.10 Termination of a Member . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
ARTICLE VI - DURATION; DISSOLUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 6.1 Duration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 6.2 Liquidation of LLC Interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
ARTICLE VII - VALUATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 7.1 Valuation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 7.2 Objection to Valuation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
ARTICLE VIII - BOOKS OF ACCOUNT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 8.1 Books . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 8.2 Tax Matters Partner and Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
ARTICLE IX - MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 9.1 No Incurrence of Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 9.2 Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 9.3 Successors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 9.4 Governing Law: Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 9.5 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 9.6 Singular, Plural; Gender . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 9.7 Complete Agreement; Headings; Counterparts . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 9.8 No Third Party Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 9.9 Tax Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 9.10 Waiver of Jury Trial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 9.11 Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
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LIMITED LIABILITY COMPANY AGREEMENT
OF
MMI PRODUCTS, L.L.C.
LIMITED LIABILITY COMPANY AGREEMENT (this "Agreement") dated
as of June 12, 1997 by and among Citicorp Venture Capital, Ltd., a New York
corporation ("CVC"), and the other persons identified on the signature pages
hereto, the foregoing Persons being Members of MMI Products, L.L.C., a Delaware
limited liability company (the "LLC"). Certain terms used herein are defined
in Section 1.6.
WHEREAS, the Members desire to form a limited liability
company pursuant to the Act by filing a Certificate of Formation of the Company
with the office of the Secretary of State of the State of Delaware and entering
into this Agreement;
WHEREAS, the parties to this Agreement are contributing to the
LLC all of their capital stock of Merchants Metals Holding Company ("MMHC") in
consideration for the issuance by the LLC to such parties of the Units
described herein.
NOW, THEREFORE, the parties hereto, intending to be legally
bound, agree as follows:
ARTICLE I
GENERAL PROVISIONS; DEFINITIONS
Section 1.1 Formation, Term. The term of the LLC
commenced on June 10, 1997 with the filing of a Certificate of Formation with
the Secretary of State of the State of Delaware pursuant to the Act and the
Members shall continue the existence of the LLC until dissolution and
termination of the LLC in accordance with the provisions of Article VI hereof.
Any amendments of the Certificate of Formation shall be authorized as provided
in Section 2.2. The Certificate of Formation, as so amended from time to time,
is referred to herein as the "Certificate." Any Member who so requests shall
have the right to receive from the LLC a copy of the Certificate.
Section 1.2 Name. The name of the LLC shall be "MMI
Products, L.L.C." or such other name or names as the Required Common Members
may from time to time designate; provided, that the name shall always contain
the words "Limited Liability Company" or "L.L.C."
Section 1.3 Purpose. The LLC is organized for any lawful
business, purpose or activity which may be conducted by a limited liability
company under the Act.
Section 1.4 Place of Business. The principal office and
place of business of the LLC shall initially be 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx. Upon giving notice to the Members, the Required Common Members may
change the principal office or place of business of the LLC
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at any time, and the Required Common Members may cause the LLC to establish
other offices or places of business in various jurisdictions and appoint agents
for service of process in such jurisdictions.
Section 1.5 Fiscal Year. The fiscal year of the LLC
shall end on December 31 of each year.
Section 1.6 Definitions. For purposes of this Agreement:
"Act" means the Delaware Limited Liability Company Act,
Delaware Code, Title 6, Sections 18-101, et. seq., as in effect from time to
time.
"Affiliate" means, with respect to any Person, any other
Person, directly or indirectly, through one or more intermediaries,
controlling, controlled by, or under common control with such Person.
"Agreement" has the meaning set forth in the recitals hereto.
"Bankruptcy Event" means the LLC, the relevant Portfolio
Company or any material Portfolio Company Subsidiary of such Portfolio Company
makes an assignment for the benefit of creditors or admits in writing its
inability to pay its debts generally as they become due; or an order, judgment
or decree is entered adjudicating the LLC, the relevant Portfolio Company or
any material Portfolio Company Subsidiary of such Portfolio Company bankrupt or
insolvent; or any order for relief with respect to the LLC, the relevant
Portfolio Company or any material Portfolio Company Subsidiary of such
Portfolio Company is entered under the Federal Bankruptcy Code; or the LLC, the
relevant Portfolio Company or any material Portfolio Company Subsidiary of such
Portfolio Company petitions or applies to any tribunal for the appointment of a
custodian, trustee, receiver or liquidator of the LLC, the relevant Portfolio
Company or any material Portfolio Company Subsidiary of such Portfolio Company
or of any substantial part of the assets of the LLC, the relevant Portfolio
Company or any material Portfolio Company Subsidiary of such Portfolio Company,
or commences any proceeding (other than a proceeding for the voluntary
liquidation and dissolution of a Subsidiary) relating to the LLC, the relevant
Portfolio Company or any material Subsidiary of such Portfolio Company under
any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt,
dissolution or liquidation law of any jurisdiction; or any such petition or
application is filed, or any such proceeding is commenced, against the LLC, the
relevant Portfolio Company or any material Portfolio Company Subsidiary of such
Portfolio Company and either (a) the LLC, the relevant Portfolio Company or any
material Portfolio Company Subsidiary of such Portfolio Company by any act
indicates its approval thereof, consent thereto or acquiescence therein or (b)
such petition, application or proceeding is not dismissed within 60 days.
"Book Value" means with respect to any LLC asset, the adjusted
basis of the LLC asset for federal income tax purposes, except as follows:
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(a) The initial Book Value of the capital stock of MMHC
contributed on the date of this Agreement by the initial Unitholders
shall be $1.00 per share;
(b) The initial Book Value of any LLC asset contributed
by a Unitholder to the LLC shall be the gross fair market value of
such LLC asset as of the date of such contribution, as determined in
good faith by the Required Common Members;
(c) The Book Value of each LLC asset shall be adjusted to
equal its respective gross fair market value, as determined in good
faith by the Required Common Members, as of the following times:
(i) the acquisition of an additional Unit in the
LLC by any new or existing Unitholder in exchange for more
than a de minimis Capital Contribution unless the Required
Common Members determine that such adjustment is not necessary
to reflect the relative economic interests of the Unitholders
in the LLC;
(ii) the distribution by the LLC to a Unitholder
of more than a de minimis amount of LLC assets (other than
cash) unless the Required Common Members determine that such
adjustment is not necessary to reflect the relative economic
interests of the Unitholders in the LLC;
(iii) the liquidation of the LLC within the meaning
of Treasury Regulation Section 1.704- 1(b)(2)(ii)(g); and
(iv) as otherwise determined by the Required
Common Members as permitted by Treasury Regulation Section
1.704-1(b)(2)(iv)(f);
(d) The Book Value of an LLC asset distributed to any
Unitholders shall be the fair market value of such LLC asset as of the
date of distribution thereof as determined in accordance with Article
VII;
(e) The Book Value of each LLC asset shall be increased
or decreased, as the case may be, to reflect any adjustments to the
adjusted basis of such LLC asset pursuant to Sections 732(d), 734(b)
or 743(b) of the Code, but only to the extent that such adjustments
are taken into account in determining Capital Accounts pursuant to
Treasury Regulation Section 1-704-1 (b)(2)(iv)(m); provided, that Book
Value shall not be adjusted pursuant to this clause (d) to the extent
that the Required Common Members determine that an adjustment pursuant
to clause (b) above is necessary or appropriate in conjunction with a
transaction that would otherwise result in an adjustment pursuant to
this clause (d); and
(f) If the Book Value of an LLC asset has been determined
or adjusted pursuant to clauses (a), (b) or (d) above, such Book Value
shall thereafter be adjusted to reflect the
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depreciation or amortization taken into account with respect to such
LLC asset for purposes of computing Profits and Losses.
"Capital Account" has the meaning set forth in Section 3.2.
"Capital Contributions" means, for each Unitholder, such
Unitholder's cash, securities or property contributed to the LLC pursuant to
Section 3.1 hereof (net of any liabilities of such Unitholder that the LLC is
considered to assume or take subject to under Section 752 or the Code).
"CCT" means CCT Partners III.
"Certificate" has the meaning set forth in Section 1.1.
"Class A Common Holder" means each holder of a Class A Common
Unit.
"Class A Common Percentage Interest" means, with respect to a
Class A Common Holder's investment in a particular Series of Class A Common
Units, a percentage equal to a fraction (i) the numerator of which is the
number of Class A Common Units of such Series held by such Class A Common
Holder, as set forth on the Investment Schedule applicable thereto, and (ii)
the denominator of which is the aggregate number of Common Units of such Series
held by all Unitholders, as set forth on such Investment Schedule.
"Class A Common Unit" means a Common Unit representing a
fractional part of the Total Unitholder Interest and having the rights and
obligations specified with respect to Class A Common Units in this Agreement.
"Class A Member" means each Class A Common Holder which is a
Member.
"Class A Preferred Holder" means each holder of a Class A
Preferred Unit.
"Class A Preferred Percentage Interest" means, with respect to
a Class A Preferred Holder's investment in a particular Series of Class A
Preferred Units, a percentage equal to a fraction (i) the numerator of which is
the number of Class A Preferred Units of such Series held by such Class A
Preferred Holder, as set forth on the Investment Schedule applicable thereto,
and (ii) the denominator of which is the aggregate number of Class A Preferred
Units of such Series held by all Unitholders, as set forth on such Investment
Schedule.
"Class A Preferred Unit" means a Preferred Unit representing a
fractional part of the Total Unitholder Interest and having the rights and
obligations specified with respect to Class A Preferred Units in this
Agreement.
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"Class B Common Unit" means a Common Unit representing a
fractional part of the Total Unitholder Interest and having the rights and
obligations specified with respect to Class B Common Units in this Agreement.
"Class B Common Holder" means each holder of a Class B Common
Unit.
"Class B Member" means each Class B Common Holder which is a
Member.
"Class B Common Percentage Interest" means, with respect to a
Class B Common Holder's investment in a particular Series of Class B Common
Units, a percentage equal to a fraction, (i) the numerator of which is the
number of Class B Common Units of such Series held by such Class B Common
Holder, as set forth on the Investment Schedule applicable thereto, and (ii)
the denominator of' which is the aggregate number of Common Units of such
Series held by all Unitholders, as set forth on such Investment Schedule.
"Closing Date" means the date of this Agreement.
"Code" means the United States Internal Revenue Code of 1986,
as amended from time to time.
"Common Holder" means any Class A Common Holder or Class B
Common Holder.
"Common Member" means any Class A Member or Class B Member.
"Common Percentage Interest" means, with respect to each
Common Holder's interest in a Series of Common Units, the sum of such Common
Holder' s Class A Percentage Interest and Class B Percentage Interest.
"Common Unit" means a Unit representing a fractional part of
the Total Unitholder Interest and having the rights and obligations specified
with respect to Class A Common Units or Class B Common Units in this Agreement
or such other Common Units as may be issued from time to time pursuant to
Section 3.1(b) and designated as Common Units. Common Units may be issued in
one or more Series or classes, each of which shall, as necessary, be
specifically identifiable to the Portfolio Company to which such Unit relates,
as specified in any Investment Schedule.
"CVC" has the meaning set forth in the recitals hereto.
"Deficit Capital Account" shall mean with respect to any
Unitholder, the deficit balance, if any, in such Unitholder's Capital Account
as of end of the taxable year, after giving effect to the following
adjustments:
(a) credit to such Capital Account any amount which such
Unitholder is obligated to restore under Treasury Regulation Section
1.704-1(b)(2)(ii)(c), as well as any addition thereto
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pursuant to the next to last sentence of Treasury Regulation Sections
1.704-2(g)(1) and (i)(5), after taking into account thereunder any changes
during such year in partnership minimum gain (as determined in accordance with
Treasury Regulation Section 1.704-2(d)) and in the minimum gain attributable to
any partner nonrecourse debt (as determined under Treasury Regulation Section
1. 704-2(i)(3)); and
(b) debit to such Capital Account the items described in
Treasury Regulation Section 1.704(b)(2)(ii)(d)(4), (5) and (6).
This definition of Deficit Capital Account is intended to comply with the
provisions of Treasury Regulation Sections 1.704-1(b)(2)(ii)(d) and 1.704-2,
and will be interpreted consistently with those provisions.
"Distribution" means each distribution made by the LLC to a
Unitholder, whether in cash, securities or property of the LLC and whether by
liquidating distribution, redemption, repurchase or otherwise (net of any
liabilities of the LLC that such Unitholder is considered to assume or take
subject to under Section 752 of the Code); provided, that any recapitalization
or exchange of Units for other Economic Interests in the LLC or subdivision or
any combination of any Units shall not be deemed a Distribution.
"Economic Interest" of a Person shall mean the share of one or
more of the LLC's Profits, Losses, and Distributions represented by the Units
held by such Person pursuant to this Agreement and the Act, but shall not
include any right to (i) participate in the management or affairs of the LLC,
(ii) vote on, consent to, or otherwise participate in any decision or action of
the Members, or (iii) receive information concerning the business and affairs
of LLC, in each case except as expressly otherwise provided in this Agreement
or required by the Act.
"Economic Owner" shall mean the owner of an Economic Interest
who is not a Member. No Economic Owner shall be deemed a "member" (as that
term is used in the Act) of the LLC.
"Entity" means any general partnership, limited partnership,
limited liability company, corporation, joint venture, trust, business trust,
cooperative, association, or any foreign trust or foreign business
organization, or any other entity which is not a natural person.
"Exchangeable Unit" shall mean any Unit with respect to which
the LLC holds corresponding Exchange Property.
"Exchange Property" shall mean, with respect to any Unit, (i)
if such Unit was issued by the LLC to the original holder thereof in
consideration for the contribution by such holder to the LLC of securities of a
Portfolio Company (or a Company that became a Portfolio Company following such
contribution), the securities contributed by such holder to the LLC in
connection with the issuance of such Unit (or any other securities of any
issuer into which such securities have been
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converted or for which such securities have been exchanged as a result of a
merger or otherwise), (ii) if such Unit was issued by the LLC to the original
holder thereof in consideration for cash or other property contributed by such
holder to the LLC which was used by the LLC to acquire securities of a
Portfolio Company (or a Company that became a Portfolio Company following such
acquisition), the securities acquired by the LLC with the cash or property
contributed by such holder (or any other securities of any issuer into which
such securities have been converted or for which such securities have been
exchanged as a result of a merger or otherwise), and (iii) if such Unit was
issued by the LLC to the original holder thereof in consideration for cash
contributed by such holder to the LLC which was used by the LLC to lend to a
Portfolio Company or a company that became a Portfolio Company following such
transaction or otherwise to acquire indebtedness of a Portfolio Company for a
Company that became a Portfolio Company following such transaction, such
indebtedness acquired by the LLC (or any securities or property into which such
indebtedness has been converted or for which such indebtedness has been
exchanged, including without limitation any indebtedness of a Portfolio Company
that is assumed by a successor Entity to such Portfolio Company as a result of
a merger or otherwise). "Exchange Property" also shall include any securities
or other non-cash property that is characterized as "Exchange Property"
pursuant to Section 4.1(b).
"Follow-On Investment" means a Portfolio Company Investment
made by the LLC relating to a Portfolio Company in which the LLC has a
preexisting and outstanding Portfolio Company Investment.
"Indemnifying Person" has the meaning set forth in Section
4.6.
"Invested Capital" means the amount of Capital Contributions
made to the LLC by any Member or Economic Owner, or any of their respective
predecessors in interest with respect to any Units in the amounts, and in
exchange for the Units, set forth on the Investment Schedule for the LCC's
investment in any Portfolio Company.
"Investment Profit or Loss" means, for any period with respect
to the LLC's investment in each Portfolio Company, all items of Profits or
Losses recognized by the LLC with respect to the LLC's investment in such
Portfolio Company, including, without limitation, any fees received by the LLC
in connection with monitoring the related Portfolio Company or any Portfolio
Company Subsidiary thereof with respect to the LLC's investment in such
Portfolio Company and any fees received from a Portfolio Company in connection
with arranging the LLC's investment in such Portfolio Company.
"Investment Schedule" means each schedule to be prepared by
the LLC immediately upon the consummation of each Portfolio Company Investment
showing the following details: (i) the Capital Contributions made by each
Participating Unitholder in connection with such Portfolio Company Investment,
(ii) the name of any Portfolio Company and, if applicable, any Portfolio
Company Subsidiary, acquired in connection with such Portfolio Company
Investment, and (iii) the amount and types of Units (including the Series of
such Units) issued to each Participating
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Unitholder in exchange for such Participating Unitholder's Capital
Contribution, in each case in substantially the form attached hereto as
Investment Schedule A (as prepared with respect to MMHC); provided, that in the
event of any Follow-On Investment, in lieu of preparing a new Investment
Schedule, the Investment Schedule relating to such pre-existing and outstanding
Portfolio Company Investment shall be amended and restated to show the required
details after giving effect to such Follow-On Investment, including without
limitation designation of Units issued to each Participating Unitholder in such
Follow-On Investment. Each Investment Schedule, and any amendments thereto,
along with a revised Schedule of Members, if necessary, shall be promptly
delivered to each Member following its preparation, and shall be deemed to have
been attached hereto for all purposes of this Agreement (including, without
limitation, Articles III and IV hereof).
"LLC" has the meaning set forth in the recitals hereto.
"Losses" shall be separately determined for the LLC's
investment in each Portfolio Company, and with respect to any "Other Income or
Loss" not attributable to the LLC's investment in a particular Portfolio
Company, shall be determined for the LLC generally, and means, for each Taxable
Year or other period of the LLC, an amount equal to the LLC's taxable loss and
deduction (determined in accordance with Section 703(a) of the Code) for such
year or period that is reasonably determined by the Tax Matters Partner to be
attributable to the LLC's investment in such Portfolio Company (including any
Investment Loss attributable to the LLC's investment in such Portfolio
Company). Losses shall include all items of loss and deduction required to be
stated separately pursuant to Section 703(a)(1) of the Code, with the following
adjustments:
(a) Any expenditures of the LLC attributable to the LLC's
investment in such Portfolio Company, or the LLC generally, and
described in Section 705(a)(2)(B) of the Code or treated as Section
705(a)(2)(B) of the Code Expenditures pursuant to Treasury Regulation
Section 1.704-1(b)(2)(iv)(i) (other than expenses in respect of which
an election is properly made under Section 709 of the Code), and not
otherwise taken into account in computing Losses pursuant to this
definition, shall be considered an item of Loss;
(b) Loss resulting from any disposition of any LLC asset
attributable to the LLC's investment in such Portfolio Company, or the
LLC generally, and with respect to which loss is recognized for
Federal income tax purpose, shall be computed by reference to the Book
Value of the LLC asset disposed of, notwithstanding that the adjusted
tax basis of such LLC asset may differ from its Book Value;
(c) Depreciation, amortization, and other cost recovery
deductions with respect to any LLC asset attributable to the LLC's
investment in such Portfolio Company, or the LLC generally, shall be
computed by reference to the adjusted Book Value of such asset
notwithstanding that the adjusted tax basis of such LLC asset differs
from its Book Value, in accordance with Treasury Regulation Section
1.704-1(b)(2)(iv)(g);
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(d) In the event the Book Value of any LLC asset
attributable to the LLC's investment in such Portfolio Company, or the
LLC generally, is decreased pursuant to subparagraph (b) or (c) of the
definition of Book Value, the amount of such adjustment shall be taken
into account as loss from the disposition of such LLC asset for
purposes of computing Losses;
(e) Any items of loss and deduction specially allocated
under Sections 4.3. 4.4 or 4.5 hereof shall not be considered in
determining Loss; and
(f) To the extent (i) the adjusted tax basis of any LLC
asset attributable to the LLC's investment in such Portfolio Company,
or the LLC generally, is decreased pursuant to Code Sections 732(d),
734(b) or 743(b) and (ii) such adjustment is required, pursuant to
Treasury Regulation Section 1.704-1(b)(2)(iv)(m), to be taken into
account in determining Capital Accounts, the amount of such adjustment
to the Capital Account shall be treated as an item of Loss.
"Member" means the initial Unitholders (as set forth on
Investment Schedule A hereto), and any other Person who is admitted to the LLC
as a Member pursuant to Sections 3.1(b), 5.6 or 5.7 in each case so long as
such Person continues to be a Member hereunder, and "Members" means all such
Members. If a Person is a Member immediately prior to the purchase or other
acquisition by such Person of an Economic Interest, such Person shall have all
the rights of a Member with respect to such purchased or otherwise acquired
Economic Interest. The Members shall constitute the "members" (as that term is
used in the Act) of the LLC.
"Membership Interest" means a Member's entire interest in the
LLC including such Member's Economic Interest and the right to (i) participate
in the management of the business and affairs of the LLC, (ii) vote on, consent
to, or otherwise participate in any decision of the Members and (iii) receive
information concerning the business and affairs of LLC, in each case to the
extent expressly provided in this Agreement or required by the Act.
"Minimum Gain" means, with respect to each nonrecourse
liability of the LLC, the amount of gain (of whatever character), if any, that
would be realized by the LLC if the LLC disposed of (in a taxable transaction)
its property subject to such liability in full satisfaction thereof (and for no
other consideration), and then aggregating the amounts so computed. A
Unitholder's share of Minimum Gain shall, at the end of any Taxable Year, be
equal to the excess of (i) the sum of the nonrecourse deductions allocated to
such Unitholder (and such Unitholder's predecessors in interest) and the
aggregate distributions to such Unitholder (and such Unitholder's predecessors
in interest) up to that time of proceeds of nonrecourse liabilities that are
allocable to an increase in Minimum Gain over (ii) the sum of such Unitholder's
(and such Unitholder's predecessors in interest) aggregate share of the net
decreases in Minimum Gain up to that time and such Unitholder's (and such
Unitholder's predecessors in interest) aggregate share of the decreases up to
that time in Minimum Gain resulting from revaluations of LLC property subject
to one or more nonrecourse
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liabilities of the LLC, as computed in accordance with the provisions of
Treasury Regulation Section 1.704-2(g).
"MMHC" has the meaning set forth in the recitals hereto.
"New Members" has the meaning set forth in Section 5.7.
"Other Income or Loss" means, for any period, all items of
Profits or Losses (including, without limitation, any break-up or commitment
fee received by the LLC in connection with a transaction that is not
consummated), but excluding Investment Profit or Loss.
"Participating Unitholder" means, with respect to each
Portfolio Company, any Person holding Units of the Series relating to such
Portfolio Company, in the amount and type set forth on the Investment Schedule
for such Portfolio Company Investment.
"Person" means any natural person or Entity, including the
heirs, executors, administrators when the context so permits.
"Portfolio Company" means each Entity listed on an Investment
Schedule hereto, and any successor by merger to any such Entity if the
successor Entity is a Subsidiary of the LLC following such merger. In the
event any such successor Entity is deemed to be a Portfolio Company pursuant to
the immediately preceding sentence, the relevant Investment Schedule will be
deemed to be automatically amended upon such merger to so reflect.
"Portfolio Company Investment" means an investment or series
of investments made by the LLC in any equity, equity-related debt or other
securities of a Portfolio Company, including any Follow-On Investment, the
details of which are set forth in an Investment Schedule.
"Portfolio Company Material Transaction" means (a) payment of
a dividend or making of a distribution on a Portfolio Company's common or
preferred shares or other Exchange Property in shares of such stock or other
Exchange Property, as the case may be, (b) subdivision (by any stock split,
stock dividend, recapitalization or otherwise) of one or more classes of such
Portfolio Company's outstanding common or preferred shares or other Exchange
Property into a greater number of shares of such stock or other Exchange
Property, as the case may be, (c) combination (by reverse stock split or
otherwise) of one or more classes of such Portfolio Company's outstanding
common or preferred shares or other Exchange Property into a smaller number of
shares of such stock or other Exchange Property, as the case may be, (d)
issuance of such Portfolio Company, by reclassification of common or preferred
shares or other Exchange Property, of any shares of such stock or other
Exchange Property, as the case may be, or (e) issuance by such Portfolio
Company, in exchange for such securities, of any debentures or other debt
securities or other Exchange Property, as the case may be.
"Portfolio Company Subsidiary" means any Subsidiary of a
Portfolio Company.
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"Preferred Member" means each holder of a Preferred Unit which
is a Member.
"Preferred Unit" means a Unit representing a fractional part
of the Total Unitholder Interest and having the preference rights and other
rights specified with respect to the Class A Preferred Units or any Units
hereafter designated as Preferred Units. Preferred Units may be issued in one
or more series or classes, each of which shall, as necessary, be specifically
identifiable to the Portfolio Company to which such Unit relates, as specified
in any Investment Schedule.
"Preferred Unit Holder" means each holder of a Preferred Unit.
"Profits" shall be separately determined for the LLC's
investment in each Portfolio Company, and with respect to any "Other Income or
Loss" not attributable to the LLC's investment in a particular Portfolio
Company shall be determined for the LLC generally, and means, for each Taxable
Year or other period of the LLC, an amount equal to the LLC's taxable income
and gain (determined in accordance with Section 703(a) of the Code) for such
year or period that is reasonably determined by the Tax Matters Partner to be
attributable to the LLC's investment in such Portfolio Company (including any
Investment Profit attributable to the LLC's investment in such Portfolio
Company). Profits shall include all items of income and gain, required to be
stated separately pursuant to Section 703(a)(1) of the Code, with the following
adjustment:
(a) Any income of the LLC attributable to the LLC's
investment in such Portfolio Company, or the LLC generally, that is
exempt from federal income tax and not otherwise taken into account in
computing Profits or Losses pursuant to this definition shall be added
to such taxable income or loss;
(b) Gain resulting from any disposition of any LLC asset
attributable to the LLC's investment in such Portfolio Company, or the
LLC generally, and with respect to which gain is recognized for
Federal income tax purposes shall be computed by reference to the Book
Value of the LLC asset disposed of, notwithstanding that the adjusted
tax basis of such LLC asset may differ from its, Book Value;
(c) In the event the Book Value of any LLC asset
attributable to the LLC's investment in such Portfolio Company, or the
LLC generally, is increased pursuant to subparagraph (b) or (c) of the
definition of Book Value, the amount of such adjustment shall be taken
into account as gain from the disposition of such LLC asset for
purposes of computing Profits;
(d) Any items of income and gain allocated under Sections
4.3, 4.4 or 4.5 hereof shall not be considered in determining Profit;
and
(e) To the extent (i) the adjusted tax basis of any LLC
asset attributable to the LLC's investment in such Portfolio Company,
or the LLC generally, is increased pursuant to Code Sections 732(d),
734(b) or 743(b) and (ii) such adjustment is required, pursuant to
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Treasury Regulation Section 1.704-1(b)(2)(iv)(m), to be taken into
account in determining Capital Accounts, the amount of such adjustment
to the Capital Account shall be treated as an item of Profit.
"Required Common Members" means, as of any date of
determination, with respect to any action submitted to a vote of Members or the
governance of the LLC, the Common Members holding Common Units which represent
a majority of the votes entitled to be cast by all such Common Members.
"Schedule of Members" means the Schedule of Members described
in Section 2.1, as in effect as of the date of determination.
"Separate Capital Account" has the meaning set forth in
Section 3.2.
"Series" means a particular series of Units designated by
reference to the particular Portfolio Company to which the Unitholders'
investments represented by such Units relate, as reflected on the Investment
Schedule.
"Subsidiary" means, with respect to any Person, any
corporation, partnership, association or other business entity of which (i) if
a corporation, a majority of the total voting power of shares of stock entitled
(without regard to the occurrence of any contingency) to vote in the election
of directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by that Person or one or more of the other Subsidiaries
of that Person or a combination thereof or (ii) if a partnership, association
or other business entity, a majority of the partnership or other similar
ownership interests thereof is at the time owned or controlled, directly or
indirectly, by any Person or one or more Subsidiaries of that Person or a
combination thereof. For purposes hereof a Person or Persons shall be deemed
to have a majority ownership interest in a partnership, association or other
business entity if such Person or Persons shall be allocated a majority of
partnership, association or other business entity gains or losses or shall be
or control the managing director, managing member, general partner or other
managing Person of such partnership, association or other business entity.
"Tax Matters Partner" has the meaning set forth in Section
8.2(a).
"Taxable Year" means the LLC's Fiscal Year or such other year
as may be required by Code Section 706.
"Terminated Member" means any Person who has ceased to be a
Member for any reason (other than a Transfer pursuant to Section 5.6, but
including a withdrawal pursuant to Section 5.8), or the estate of or successor
in interest to such Person. Upon becoming a Terminated Member hereunder, if
such Person, or the estate or successor interest to such Person, continues to
hold Units, then such Person or holder shall automatically be deemed to be an
Economic Owner for purposes of this Agreement.
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"Total Unitholder Interest" means all Economic Interests of
all Members and Economic Owners represented by all Units outstanding.
"Transfer" means a transfer or assignment of an Economic
Interest or a Membership Interest, as applicable.
"Treasury Regulations" means the income tax regulations
promulgated under the Code and effective as of the date hereof. Such term
shall be deemed to include any amendments to such regulations and any
corresponding provisions of succeeding regulations to the extent the Required
Common Members determine that any such amendments and succeeding regulations do
not adversely affect the economic interests of the Unitholders hereunder.
"Unit" means a unit issued by the LLC (whether a Preferred
Unit, a Common Unit, or any other unit of the LLC created hereafter in
accordance with the terms of this Agreement) representing a fractional part of
the Total Unitholder Interest; provided, that:
(a) each Common Unit of a class at any time outstanding
and allocable to the LLC's investment in any Portfolio Company shall
represent the same fractional part of the Total Unitholder Interest of
all Unitholders owning Common Units of such class allocable to the
LLC's investment in such Portfolio Company as each other Common Unit
of such class allocable to the LCC's investment in such Portfolio
Company, and
(b) each Preferred Unit of a class at any time
outstanding and allocable to the LLC's investment in any Portfolio
Company shall represent the same fractional part of the Total
Unitholder Interest of all Unitholders owning Preferred Units of such
class allocable to the LLC's investment in such Portfolio Company as
each other Preferred Unit of such class allocable to the LLC's
investment in such Portfolio Company.
"Unit Purchase Agreements" means a unit purchase or similar
agreement pursuant to which a Participating Unitholder makes a Capital
Contribution in exchange for Units in accordance with Section 3.1(b) hereof in
connection with a Portfolio Company Investment made after the Closing Date.
"Unitholder" means any Member or Economic Owner in its
capacity as owner of one or more Units as reflected on the LLC's books and
records.
ARTICLE II
MEMBERS AND RIGHTS OF MEMBERS AND OTHER UNITHOLDERS
Section 2.1 Members. The initial Members of the LLC and
their addresses shall be listed on Schedule of Members hereto and such schedule
shall be amended from time to time by the Required Common Members to reflect
the withdrawal of Members or the admission of additional Members pursuant to
this Agreement. The Schedule of Members shall constitute the record list of
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the Members for all purposes of this Agreement. The LLC shall maintain the
names and addresses of all Economic Owners, if any.
Section 2.2 Voting Rights.
(a) Except as otherwise required by applicable law or as
expressly provided in this Agreement, (i) with respect to any action submitted
to a vote of Members which relates solely to a particular Portfolio Company or
to the LLC's investment in such Portfolio Company, the Common Members holding
Common Units of the Series relating to such Portfolio Company shall be entitled
to vote thereon, (ii) with respect to any consent required under Sections 5.6
and 5.7, or with respect to any action to be taken by the LLC in connection
with any matter described in Section 5.6, the Common Members holding Common
Units of the Series to which the Units transferred or to be transferred belong
(but excluding the holder of the Units transferred or to be transferred) shall
be entitled to vote thereon and (iii) with respect to any other action
submitted to a vote of Members (including but not limited to action relating to
investment in or acquisition of a new entity that will become a Portfolio
Company or the making by any Person of any investment in the LLC with respect
to such new Portfolio Company), all Common Members holding Common Units of any
Series shall be entitled to vote thereon. Except as otherwise required by
applicable law or as expressly provided in this Agreement, (a) no Members
(other than those provided in the immediately preceding sentence) shall be
entitled to vote with respect to any action to be taken hereunder and (b) no
class of Units shall be entitled to, or subject to, a separate class vote with
respect to any action to be taken hereunder. Notwithstanding the foregoing, a
class of Units shall be entitled to a separate class vote if the LLC, as a
stockholder of a particular Portfolio Company, proposes to amend such Portfolio
Company's charter and such amendment would alter or change, the powers,
preferences, or special rights of any class of Portfolio Company securities for
which such class of Units is exchangeable pursuant to Section 2.8, in a manner
adverse to the holders of such securities.
(b) With respect to each action submitted to a vote of
Members and with respect to which no separate Series or class vote is
applicable, Class A Members entitled to vote thereon will be entitled to a
number of votes equal to, in the aggregate, 50.5% of the total number of votes
of Common Members entitled to be cast thereon (unless no Class B Members are
entitled to vote thereon, in which case the Class A Members entitled to vote
thereon will be entitled to 100% of the vote), and the Class B Members entitled
to vote thereon will be entitled to a number of votes equal to, in the
aggregate, 49.5% of the total number of votes of Common Members entitled to be
cast thereon (unless no Class A Members are entitled to vote thereon, in which
case the Class B Members entitled to vote thereon will be entitled to 100% of
the vote). In determining the vote of Class B Members on matters as to which
both Class B Members and Class A Members are entitled to vote (other than
matters with respect to which a separate class vote is applicable), each Class
B Common Unit with respect to which a Class B Member is entitled to vote shall
be entitled to one vote per Unit and the aggregate number of votes to which
such Class B Members are then entitled will be cast in the manner specified by
a vote of the majority of the votes of such Class B Members.
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(c) Notwithstanding anything to the contrary contained
herein, until such time as CVC ceases to own at least 25% of the Common Units,
the prior written consent of CVC shall be necessary to approve any of the
following with respect to the LLC:
(i) a merger involving the LLC with or into any
other entity or any liquidation, dissolution, recapitalization, or
reorganization in any form of transaction by the LLC;
(ii) the engagement by the LLC in any business
other than the businesses in which it is currently engaged;
(iii) any amendment, modification, or waiver of the
LLC's certificate of formation or limited liability company agreement;
(iv) the dissolution of the LLC pursuant to
Section 6.1; or
(v) the appointment of a successor Liquidator
pursuant to Section 6.2.
(d) Notwithstanding anything to the contrary contained
herein, until such time as CVC ceases to own at least 25% of the Common Units
of a particular Series, the prior written consent of CVC shall be necessary to
approve any of the following with respect to any Portfolio Company to which
such Series relates or any of the Portfolio Company Subsidiaries of such
Portfolio Company (or, in the case of item (ix) below, with respect to such
Series):
(i) a merger involving such Entity with or into
any other entity or any sale, lease, or other disposition of all or
substantially all of the assets of such Entity or any liquidation,
dissolution, recapitalization, or reorganization in any form of
transaction by such Entity;
(ii) the engagement by such Entity in any business
other than the businesses in which it is currently engaged;
(iii) any declaration of dividends on such Entity's
equity interests of any class, or the repurchase by such Entity of any
class of equity interests of such Entity;
(iv) the acquisition or sale by such Entity of any
assets otherwise than in the ordinary course of business or the
investment by such Entity in any other person or entity (other than
temporary liquid investments of idle funds);
(v) the making or forgiveness of a loan by such
Entity to any employee, manager, Member, partner, stockholder, or
director of such Entity, any relative of such employee, manager,
Member, partner, stockholder or director, or any Affiliate of such
employee, manager, Member, partner, stockholder, director, or
relative;
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(vi) the entering into, modification, amendment,
or termination of any employment agreement with any Member who is an
executive officer of such Entity;
(vii) the issuance or sale by such Entity of (a)
its debt securities, (b) any of its equity interests (other than
equity interests issued on exercise of options that have been approved
by CVC), (c) any of its options, warrants, convertible securities, or
(d) any rights to acquire such equity interests;
(viii) any amendment, modification, or waiver of any
certificate of formation, agreement of limited liability company,
by-laws, articles of incorporation or any other applicable
organizational documents of any such Entity; and
(ix) any election by the Required Common Members
with respect to such Series, pursuant to Section 2.8(a)(ii), to
require the LLC to exchange all Exchangeable Units of such Series for
all the corresponding Exchange Property then held by the LLC.
For purposes of this Section 2.2(d), CVC shall be deemed to
have given its written consent to an act if any director of such Portfolio
Company or other Entity who is designated by CVC votes in favor of a board
resolution authorizing such action (whether specifically described therein or
as part of a series of actions or part of a transaction).
(e) Any action required by the Act or this Agreement to
be taken at a meeting of the Members or a committee of the Members or any
action which may be taken at a meeting of such Members or committee, may be
taken without a meeting if a consent in writing, setting forth the action so
taken, shall be signed by the Members (acting for themselves or through a
proxy) owning Units entitled to not less than the minimum number of votes that
would be necessary to authorize or take such action at a meeting at which the
Members entitled to vote thereon were present and voted, or by the necessary
number of committee members whose approval would be necessary to authorize or
take such action at a meeting at which such committee members were present and
voted, as applicable, and such consent shall have the same force and effect as
a vote of such Members or committee members, as the case may be, and may be
stated as such in any certificate or document filed with the Secretary of State
of the State of Delaware or in any certificate delivered to any person;
provided, however, that no Member shall execute a written consent of Members
pursuant to Section 18-302 of the Act (or any similar successor provision) with
respect to any matter on which CVC is entitled to vote unless CVC has executed
such written consent.
Section 2.3 Conversion of Class B Units.
(a) Each outstanding Class B Common Unit of any Series
will be automatically, and without further action on the part of the LLC or the
holder thereof, converted or exchanged into the same number of Class A Common
Units of the same Series upon the election by the Class B Members representing
a majority of the outstanding Class B Common Units of such Series held by Class
B Members (such election to be exercised by written notice to the LLC).
Promptly thereafter,
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the LLC shall notify each holder of Class B Common Units of such conversion.
Following such conversion, the LLC shall not issue any Class B Common Units of
the same Series.
(b) At least ten days prior to the sale or other transfer
of any Class B Common Units of a particular Series, the transferor of such
Units shall give written notice of such proposed transfer to the Class B
Members holding a majority of the Class B Units of such Series held by Class B
Members. Such notice shall state the date of the proposed transfer and the
identity of the transferee. At any time prior to the date of such transfer,
the Class B Members holding a majority of the Class B Common Units of such
Series held by Class B Members may, by written notice to the transferror and
the LLC, elect to cause each Class B Common Unit proposed to be transferred to
be converted into and exchanged for one Class A Common Unit of the same Series.
Such conversion shall be effective upon sale or transfer of such Class B Common
Units without any further action on the part of the LLC, the transferor or the
transferee.
(c) The conversion of Class B Common Units into Class A
Common Units will be made without charge to the Class B Common Holders of any
issuance tax in respect thereof or other cost incurred by the LLC in connection
with such conversion and the related issuance of Class A Common Units.
(d) All Class A Common Units issuable upon any conversion
of Class B Common Units shall, when issued, be duly and validly issued, and
free from all taxes, liens, and charges. The LLC shall take all such actions
as may be necessary to assure that all such Class A Common Units may be so
issued without violation of any applicable law or governmental regulation or
any requirements of any domestic securities exchange upon which Class A Common
Units may be listed (except for official notice of issuance which shall be
immediately transmitted by the LLC upon issuance).
(e) The LLC shall not close its books against the
transfer of Class B Common Units or of Class A Common Units in any manner which
would interfere with the timely conversion of Class B Common Units. The LLC
shall assist and cooperate with any Class B Common Holders required to make any
governmental filings or obtain any governmental approval prior to or in
connection with any conversion of Class B Common Units hereunder (including,
without limitation, making any filings required to be made by the LLC).
(f) If the LLC in any manner subdivides or combines the
outstanding units of one class or series of Common Units, the outstanding units
of the other class and related series of Common Units shall be proportionately
subdivided or combined in a similar manner.
Section 2.4 Limitation of Liability.
(a) The debts, liabilities and obligations incurred,
contracted for or otherwise existing with respect to a particular Series (or
with respect to the LLC's investment in the Portfolio Company to which such
Series relates) shall be enforceable against the assets that are associated
with
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such Series only, and not against the assets of the LLC generally or the assets
of the LLC that are associated with any other Series. Separate and distinct
records shall be maintained for each and every Series, and assets associated
with any such Series shall be accounted for separately from the other assets of
the LLC, or any other Series of the LLC. The Members shall not commingle the
assets of one Series with the assets of any other Series. The Certificate of
Formation shall contain notice of the limitation of liabilities of a Series as
to other Series in conformity with Section 18-215 of the Act.
(b) Except as otherwise provided in the Act, no Member or
Economic Owner shall be obligated personally for any debt, obligation or
liability of the LLC or of any other Member or Economic Owner solely by reason
of being a Member or Economic Owner. Except as otherwise provided in the Act,
by law or expressly in this Agreement, no Member or Economic Owner shall have
any fiduciary or other duty to another Member or Economic Owner with respect to
the business and affairs of the LLC. No Member or Economic Owner shall have
any responsibility to restore any negative balance in his Capital Account or to
contribute to or in respect of the liabilities or obligations of the LLC or
return distributions made by the LLC except as provided in Section 4.6 or as
otherwise required by the Act or other applicable law.
(c) No Member and none of its Affiliates, stockholders,
members, directors, managers, partners, officers or employees shall be
expressly or impliedly restricted or prohibited by this Agreement from engaging
in other activities or business ventures of any kind or character whatsoever.
Each of the Members and its Affiliates, stockholders, members, directors,
managers, partners, officers and employees shall have the right to conduct, or
to possess a direct or indirect ownership interest in, activities and business
ventures of every type and description. Neither the LLC nor any Member shall
have any rights or claims by virtue of this Agreement or the relationships
created hereby in any activities or business ventures of any Member or its
Affiliates, stockholders, directors, managers, partners, officers and
employees, other than the LLC (it being expressly understood and agreed that
any and all such rights and claims are hereby irrevocably waived by each of the
Members on its behalf and on behalf of the LLC).
Section 2.5 No Right to Withdraw. No Member or Economic
Owner shall have any right to receive any distribution or the repayment of its
Capital Contributions, except distributions provided in Section 4.1,
distributions provided in Article VI upon dissolution and liquidation of the
LLC and rights regarding exchange of Units for Exchange Property pursuant to
Section 2.8. A Member may withdraw from the LLC only in accordance with
Section 5.8.
Section 2.6 Rights to Information. Members shall have
the right to receive, upon request, a copy of the Certificate and of this
Agreement, as amended from time to time, and such other information regarding
the LLC as is required by the Act, subject to reasonable conditions and
standards established by the Required Common Members, which may include,
without limitation, withholding or restrictions on the use of confidential
information. Economic Owners shall have the right to receive such information
from the LLC regarding the basis of the allocations made pursuant to Section
4.2 and the distributions made pursuant to Section 4.1 as such an Economic
Owner may
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reasonably request, subject to reasonable conditions and standards established
by the Required Common Members, which may include, without limitation,
withholding or restrictions on the use of confidential information.
Section 2.7 Remuneration to Members or Economic Owners.
Except as otherwise expressly set forth in this Agreement or as otherwise
approved by the Required Common Members, no Member or Economic Owner in his,
her or its capacity as such, shall be entitled to remuneration for acting in
the LLC's business.
Section 2.8 Exchange of Units for Interests in Portfolio
Companies.
(a) At any time after any Portfolio Company with respect
to which a particular Unit relates has completed an underwritten public
offering of any of its equity securities (the date such offering is completed
being referred to herein as the "Exchange Exercise Opening Date"):
(i) any Unitholder holding Exchangeable Units may
exchange all Exchangeable Units of a particular Series then
held by such Unitholder for the corresponding Exchange
Property then held by the LLC; provided, however, that any
such election to exchange shall be deemed, in the case of
Exchangeable Units that are Class A Units, absent the written
consent of the Unitholders of a majority of the Class B Units
of such Series, to constitute an election to exchange all but
one of the Exchangeable Units of such Series then held by the
Unitholder so electing to exchange; and
(ii) the Required Common Members with respect to a
particular Series may elect to require the LLC, subject to the
provisions of Section 2.2(d), to exchange all of the
Exchangeable Units of such Series for all of the corresponding
Exchange Property then held by the LLC, and in such case such
Exchangeable Units shall be deemed to be automatically
exchanged for the corresponding Exchange Property without any
further action on the part of the Unitholders of the
Exchangeable Units of such Series or on the part of the LLC on
the date of such election (the effective date of any exchange
pursuant to this Section 2.8 being referred to herein as the
"Exchange Date").
(b) If, at any time, a Bankruptcy Event shall occur,
subject to the restrictions of applicable law, all of the Exchangeable Units
then outstanding (or, in the case of a Bankruptcy Event of a Portfolio Company
or any of its material Portfolio Company Subsidiaries, the Exchangeable Units
then outstanding of the Series relating to such Portfolio Company) shall be
deemed to be automatically exchanged for the corresponding Exchange Property
without any action on the part of the Unitholders of the Exchangeable Units or
the LLC, in which case the date of such Bankruptcy Event shall be the Exchange
Date.
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(c) If, at any time, any Unitholder holding Units issued
in respect of MMHC or any Portfolio Company that is the successor by merger of
MMHC dies or become incapacitated or the Units held by such Unitholder become
subject to sale or other transfer by reason of any of the events described in
Section 5.6(f), or, as to any Unitholder holding Units issued in respect of
MMHC or any Portfolio Company that is the successor by merger of MMHC who is
employed by MMHC or any Portfolio Company that is the successor by merger of
MMHC or any of their respective Subsidiaries on the date of contribution, if
such employment hereafter ceases for any reason, all of the Exchangeable Units
issued in respect of MMHC or any Portfolio Company that is the successor by
merger of MMHC held by such Unitholder shall be deemed to be automatically
exchanged for the corresponding Exchange Property without any action on the
part of such Unitholder or the LLC. The Exchange Date shall be the date of
such death, incapacity, sale, transfer or cessation of employment.
(d) Promptly upon obtaining knowledge of the occurrence
or proposed occurrence of a Bankruptcy Event, but in any event, within five (5)
days after such occurrence, the LLC shall mail a notice of such event by first-
class mail to each holder of Exchangeable Units. This notice shall, among
other things, state:
(i) that a Bankruptcy Event has occurred or is
proposed to occur;
(ii) the circumstances and relevant facts
(including financial information) concerning such Bankruptcy Event;
and
(iii) that such Unitholder's Exchangeable Units
have been automatically exchanged for the corresponding Exchange
Property.
Failure to give such notice or any defect in such notice to a Unitholder shall
not affect the validity of the notice given to any other Unitholder or the
validity of any exchange. The LLC shall mail notice of such exchange by first
class mail to each holder of Exchangeable Units.
(e) In order to exchange Exchangeable Units pursuant to
Section 2.8(a)(i), a Unitholder must complete and manually sign an exchange
notice in substantially the form attached as Exhibit A (the "Exchange Notice")
specifying the number of Exchangeable Units to be exchanged and the Exchange
Date and must deliver such Exchange Notice to the LLC. The Exchange Date shall
be any date specified by the Unitholder, and may be as soon as the date on
which the LLC receives the Exchange Notice. Once received by the LLC, an
Exchange Notice shall be irrevocable and may not be withdrawn by a Unitholder
for any reason.
(f) As soon as possible after the Exchange Date (but in
any event no later than five (5) Business Days following the Exchange Date),
the LLC shall deliver to the exchanging Unitholder the Exchange Property which
such Unitholder is entitled to receive in accordance with the provisions of
this Agreement, together with any required stock transfer powers or similar
conveyance documents.
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(g) Each exchange shall be deemed to have been effected
at the opening of business on the Exchange Date, and at such time all rights of
the Unitholder of such Exchangeable Units as a Unitholder of such Exchangeable
Units (other than the right to receive Exchange Property for the Exchangeable
Units and any right to receive any Distribution on such Exchangeable Units as
provided for in Section 2.8(i)) shall cease and the Unitholder shall, as
between such Unitholder and the LLC, be deemed to have become the holder of
record of the Exchange Property represented thereby.
(h) If, between any Exchange Date and the related date of
delivery of applicable Exchange Property, such Exchange Property shall cease to
have any or certain rights or a record date or effective date of a Portfolio
Company Material Transaction shall occur, the Unitholder entitled to receive
such Exchange Property shall be entitled only to receive such Exchange Property
as so modified on the date of the delivery, and the LLC shall not be otherwise
liable with respect to the modification of such Exchange Property from such
Exchange Date to the date of such delivery.
(i) If the Exchange Date occurs during the period between
the close of business on the record date for a Distribution (or for any
distribution on the applicable Exchange Property) and the close of business on
the payment date, the Exchange Property shall be deemed to include the right to
the amount of such Distribution payable on such Exchangeable Units being
surrendered for exchange (or such distribution on the applicable Exchange
Property).
(j) The LLC shall not close its books against the
transfer of Exchangeable Units in any manner which interferes with the timely
exchange of Exchangeable Units. The LLC shall assist and cooperate with any
Unitholder required to make any governmental filings or obtain any governmental
approval prior to or in connection with any exchange of Units hereunder
(including, without limitation, making any filings required to be made by the
LLC).
(k) The LLC shall take all such actions as may be
reasonably necessary to assure that all Exchange Property which consists of
securities may be transferred, in the context of an exchange pursuant to this
Section 2.8, without violation of any applicable law or governmental regulation
or any requirements of any domestic or foreign securities exchange upon which
shares may be listed.
(l) The LLC will pay any and all documentary, stamp,
transfer or similar taxes that may be payable in respect of the transfer and
delivery of Exchange Property upon any exchange of Exchangeable Units.
(m) The LLC hereby warrants that, upon exchange of
Exchangeable Units pursuant to this Agreement, the holders of Exchangeable
Units shall receive all rights held by the LLC in the Exchange Property free
and clear of any and all liens created by the LLC.
(n) For tax purposes, any exchange pursuant to this
Section 2.8 shall be treated as a redemption of the Exchangeable Units in
exchange for the positive balances in the
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corresponding Capital Accounts (as determined under Section 3.2) of the
Unitholders receiving Exchange Property. It is contemplated that the Capital
Accounts will be appropriately adjusted immediately prior to the exchange so
that the amount received (including the Book Value of Exchange Property
received) by each Unitholder receiving Exchange Property for Exchangeable Units
shall be equal to such Unitholder's' Capital Account, as so adjusted.
ARTICLE III
CAPITAL CONTRIBUTIONS; CAPITAL ACCOUNTS
Section 3.1 Capital Contributions.
(a) Concurrently with the execution and delivery of this
Agreement, the initial Members are making Capital Contributions in the
respective amounts set forth on Investment Schedule A hereto, each in
consideration for the issuance of the number and type of Units specified on
Investment Schedule A.
(b) In addition to the Capital Contributions described in
Section 3.1(a), the LLC may accept subsequent Capital Contributions and issue
Units in respect of such Capital Contributions, upon terms and conditions which
the Required Common Members may deem appropriate in connection with any
Portfolio Company Investment made after the Closing Date, provided, that (i) in
the event that the LLC issues Units other than the Class A Common Units, Class
B Common Units or Class A Preferred Units, this Agreement shall be amended in a
manner determined in good faith by the Required Common Members, (ii) the LLC
shall prepare an Investment Schedule with respect to such Portfolio Company
Investment (or, in the case of a Follow-On Investment, shall amend the existing
Investment Schedule, in compliance with the definition of "Investment
Schedule," contained herein), (iii) notwithstanding anything contained herein
to the contrary, no Member or Economic Owner shall be deemed to be obligated or
otherwise required to make any such subsequent Capital Contributions, and (iv)
a Participating Unitholder shall be deemed admitted as a Member upon making
such subsequent Capital Contribution unless determined otherwise by the
Required Common Members and disclosed on such Investment Schedule (in which
case, such Participating Unitholder shall be deemed an Economic Owner only).
The LLC shall invest any cash received in consideration for issuance of
additional Units in securities of a Portfolio Company of like amount as such
Units and similar type to such Units.
Section 3.2 Capital Accounts.
(a) The LLC shall maintain a "Separate Capital Account"
for each Unitholder with respect to the LLC's investment in each Portfolio
Company according to the principles contained in Treasury Regulation Section
1.704-1(b)(2)(iv). For this purpose, the LLC may, upon the occurrence of the
events specified in Treasury Regulation Section 1.704-1(b)(2)(iv)(f), increase
or decrease the Capital Accounts in accordance with the rules of such
regulation and Treasury Regulation Section 1.704-1 (b)(2)(iv)(g) to reflect a
revaluation of the LLC property. The LLC shall
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also maintain a "Capital Account" for each Unitholder, which shall be equal to
the aggregate of such Unitholder's Separate Capital Accounts.
(b) The Tax Matters Partner (as defined in Section
8.2(d)) shall be responsible for allocating items of income, gain, loss, and
deduction among the LLC's investment in various Portfolio Companies for
purposes of determining the Profits and Losses from each such Portfolio
Company.
(c) Items of Other Income or Loss that are not reasonably
attributable to the LLC's investment in any particular Portfolio Company shall
be allocated by the Tax Matters Partner among the LLC's investments in all
Portfolio Companies, pro rata based upon the relative Capital Contributions
attributable to the LLC's investment in each Portfolio Company.
Section 3.3 Interest. No interest shall be paid by the
LLC on Capital Contributions or on balances in Capital Accounts.
Section 3.4 No Withdrawal. No Person shall be entitled
to withdraw any part of his Capital Contribution or Capital Account or to
receive any Distribution from the LLC, except as expressly provided herein.
Section 3.5 Loans. Loans by Members or Economic Owners
to the LLC shall not be considered Capital Contributions. If any Member or
Economic Owner shall advance funds to the LLC in excess of the amounts required
hereunder to be contributed by him, her or it to the capital of the LLC, the
making of such advance shall not result in any increase in the amount of the
Capital Account of such Member or Economic Owner. The amount of any such
advance shall be a debt of the LLC to such Member or Economic Owner and shall
be payable or collectible in accordance with the terms and conditions upon
which such advances are made.
ARTICLE IV
DISTRIBUTIONS AND ALLOCATIONS
Section 4.1 Distributions.
(a) The Unitholders holding each type of Exchangeable
Unit shall have the right to receive all cash received by the LLC in respect of
the corresponding Exchange Property. Such cash shall be distributed among such
Unitholders in accordance with their Common Percentage Interests, or Class A
Preferred Percentage Interests, as the case may be, after reduction of such
cash for the expenses or reserves of the LLC related to such Distribution.
Such Distributions shall be made as soon as practicable following receipt of
such cash by the LLC.
(b) If at any time any Exchangeable Units are
outstanding, the corresponding Portfolio Company or any issuer of securities
which constitute corresponding Exchange Property shall distribute or grant to
holders of any securities which constitute corresponding Exchange
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Property, any securities or other non-cash property, the LLC shall, at the
election of the holders of a majority of the Exchangeable Units which would
exchange for such Exchange Property: (i) to the extent permissible by the terms
of said securities or other non-cash property, distribute such securities or
other non-cash property pro rata to the holders of the Exchangeable Units which
would exchange for such Exchange Property after the close of business on the
record date (or if there is no record date, the close of business on the
effective date) for such distribution or grant, after reduction for the
expenses or reserves of the LLC related to such Distribution or (ii) retain
such securities or other non-cash property. In the case of clause (ii) above,
such securities or other non-cash property shall become Exchange Property, and
each Unitholder holding Exchangeable Units shall be entitled to receive upon
exchange the amount of securities or other non-cash property as such Unitholder
would have owned or have been entitled to receive immediately after such
distribution or grant had such Exchangeable Units been exchanged immediately
prior to the record date or effective date, as the case may be, of such
distribution or grant.
(c) Cash received by the LLC that is not reasonably
attributable to any particular Portfolio Company shall be allocated by the Tax
Matters Partner among all Portfolio Companies, pro rata based upon the Capital
Contributions attributed to the LLC's investment in each Portfolio Company.
Cash so allocated to each Portfolio Company shall be allocated, after reduction
of such cash for the expenses or reserves of the LLC related thereto, to the
Common Holders holding Units of the Series relating to such Portfolio Company
in accordance with their Common Percentage Interests. The Required Common
Members shall determine the time and manner of such Distribution.
(d) If all Exchange Property held by the LLC in respect
of a Portfolio Company is sold, exchanged or otherwise transferred or disposed
of by the LLC pursuant to instructions from the Required Common Members, the
consideration received shall be distributed to the Unitholders holding
Exchangeable Units that are exchangeable into such Exchange Property in
accordance with their Common Percentage Interests or Class A Preferred
Percentage Interests, as the case may be. The Required Common Members shall
determine the time and manner of such Distributions and may establish any
reserves of the LLC related thereto.
(e) A Distribution with respect to a Portfolio Company
pursuant to Section 4.1(a), (b), (c) or (d) shall be made only to the
Unitholders shown on the Investment Schedule for such Portfolio Company in
effect as of the date of the Distribution, except as otherwise stated in such
Sections.
(f) Notwithstanding the foregoing provisions relating to
reduction of Distributions for expenses or reserves of the LLC related to such
Distributions, the Unitholders shall attempt to cause any expenses or reserves
of the LLC that relate to the LLC's investment in a particular Portfolio
Company to be funded by such Portfolio Company (subject to any limitations on
the Portfolio Company's ability to do so under law, contract or principles of
fiduciary duty). To the extent such expenses or reserves are funded by the
applicable Portfolio Company, no reduction to such Distributions will be made.
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Section 4.2 Allocations.
(a) In general, items of Profit and Loss shall be
specially allocated among the Unitholders in accordance with this Section 4.2.
Each item of Profit or Loss shall be reflected in the Capital Account of the
Unitholder to whom it is allocated, pursuant to Section 3.2(a).
(b) The Tax Matters Partner shall be responsible for
allocating items of income, gain, loss and deduction among the various
Portfolio Companies (or the LLC's investments in such Portfolio Companies) for
purposes of determining the Profits and Losses from each such Portfolio Company
(or the LLC's investments in such Portfolio Companies).
(c) Investment Profit or Loss shall be allocated to the
Unitholders holding the Exchangeable Units that are exchangeable into the
Exchange Property to which such Investment Profit or Loss relates. Such
Investment Profit or Loss shall be allocated among such Unitholders in
accordance with their Common Percentage Interests or Class A Preferred
Percentage Interests, as the case may be.
(d) Other Income or Loss associated with each Portfolio
Company (or the LLC's investments in such Portfolio Companies) shall be
allocated to the Common Holders holding Units of the Series relating to such
Portfolio Company in accordance with their Common Percentage Interests.
Section 4.3 Special Allocations.
(a) Deductions and losses attributable to a partner
nonrecourse debt (as defined in Treasury Regulation Section 1.704-2(b)(4))
shall be allocated in the manner required by Treasury Regulation Section
1.704-2(i). If there is a net decrease during a Taxable Year in partner
nonrecourse debt minimum gain (as defined in Treasury Regulation Section
1.704-2(i)(3)), then income and gain with respect to a Portfolio Company
Investment for such Taxable Year (and, if necessary, for subsequent Taxable
Years) shall be allocated to the Unitholders in the amounts and of such
character as determined according to Treasury Regulation Section 1.704-2(i)(4).
(b) Except as otherwise provided in Section 4.3(a), if
there is a net decrease in the Minimum Gain during any Taxable Year, each
Unitholder shall be allocated income and gain for such Taxable Year (and, if
necessary, for subsequent Taxable Years) in the amounts and of such character
as determined according to Treasury Regulation Section 1.704-2(f). This Section
4.3(b) is intended to be a minimum gain chargeback provision that complies with
the requirements of Treasury Regulation Section 1.704-2(f), and shall be
interpreted in a manner consistent therewith.
(c) If any Unitholder who unexpectedly receives an
adjustment, allocation, or distribution described in Treasury Regulation
Section 1.704-1(b)(2)(ii)(d)(4), (5), and (6) has a Deficit Capital Account as
of the end of any Taxable Year, computed after the application of Sections
4.3(a) and 4.3(b) but before the application of any other provision of this
Article IV, then
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income and gain for such Taxable Year shall be allocated to such Unitholder in
proportion to, and to the extent of, such Deficit Capital Account. This
Section 4.3(c) is intended to be a qualified income offset provision as
described in Treasury Regulation Section 1.704-1(b)(2)(ii)(d) and shall be
interpreted in a manner consistent therewith.
(d) Allocations of income, gain, deduction, and loss to a
Unitholder under this Section 4.3 shall be allocated to such Unitholder's
Separate Capital Accounts based upon the LLC's investment in the Portfolio
Company giving rise to the allocation, as determined by the Tax Matters
Partner. Subject to the other provisions of this Section 4.3, if income, gain,
loss or deduction are allocated for any Fiscal Year pursuant to Section 4.3(a),
(b) or (c), then subsequent allocations of income, gain, loss and deduction
shall be made, to the extent possible, to the applicable Unitholders in such
amounts so that the net income, gain, loss and deduction allocated pursuant to
this Section 4.3(d) and Sections 4.3(a), (b) and (c) are equal to the net
income, gain, loss and deduction that would have been allocated to the
applicable Unitholders if such allocations pursuant to Sections 4.3(a), (b) and
(c) had not been made.
(e) If all or any portion of any Participating
Unitholder's Units are transferred during any Fiscal Year, items of Profit and
Loss attributable to the transferred Units for such Fiscal year shall be
allocated between the transferor and the transferee by closing the books with
respect to such transferred Units as of the date of transfer, as permitted by
Code Sections 706(c) and (d).
(f) If, and to the extent that, any Unitholder is deemed
to recognize any item of income, gain, loss, deduction or credit as a result of
any transaction between such Unitholder and the LLC pursuant to Code Sections
1272-1274, 7872, 483, 482 or any similar provision now or hereafter in effect,
and the Required Common Members determine that any corresponding income, gain,
loss or deduction with respect to the LLC's investment in the applicable
Portfolio Company of the LLC should be allocated to the Participating
Unitholder who recognized such item in order to reflect the Participating
Unitholders' economic interests in the LLC, then such income, gain, loss or
deduction shall be so allocated.
Section 4.4 Tax Allocations.
(a) The income, gains, losses, deductions and credits of
the LLC will be allocated, for federal, state and local income tax purposes,
among the Unitholders in accordance with the allocation of such income, gains,
losses, deductions and credits among the Unitholders for computing their
Capital Accounts, except that if any such allocation is not permitted by the
Code or other applicable law, the LLC's subsequent income, gains, losses,
deductions and credit will be allocated among the Unitholders so as to reflect
as nearly as possible the allocation set forth herein in computing their
Capital Accounts.
(b) Items of the LLC taxable income, gain, loss and
deduction with respect to any property contributed to the capital of the LLC
shall be allocated among the Unitholders in
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accordance with Code Section 704(c) so as to take account of any variation
between the adjusted basis of such property to the LLC for federal income tax
purposes and its Book Value.
(c) If the Book Value of any LLC asset is adjusted,
subsequent allocations of items of taxable 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 Book Value
in the same manner as under Code Section 704(c).
(d) Allocations of tax credits, tax credit recapture, and
any items related thereto shall be allocated to the Unitholders according to
their interests in such items as determined by the Required Common Members
taking into account the principles of Treasury Regulation Section
1.704-1(b)(4)(ii).
(e) Allocations pursuant to this Section 4.4 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 Unitholder's Capital Account or
share of income, gains, losses, deductions, Distributions or other LLC items
pursuant to any provision of this Agreement.
Section 4.5 Curative Allocations. If the Required
Common Members determine, after consultation with counsel experienced in
partnership income tax matters, that the allocation of any item of the LLC
income, gain, loss, deduction or credit is not specified in this Article IV (an
"unallocated item"), or that the allocation of any item of the LLC income,
gain, loss, deduction or credit hereunder is clearly inconsistent with the
Unitholders' economic interests in the LLC (determined by reference to the
general principles of Treasury Regulation Section 1.704-1(b) and the factors
set forth in Treasury Regulation Section 1.704-1(b)(3)(ii)) (a "misallocated
item"), then Required Common Members may allocate such unallocated items, or
reallocate such misallocated items, to reflect such economic interests;
provided, that no such allocation will be made without the prior consent of
each Member which would be affected thereby (which consent no such Member may
unreasonably withhold).
Section 4.6 Indemnification and Reimbursement for
Payments on Behalf of a Unitholder. If the LLC is obligated to pay any amount
to a governmental agency (or otherwise makes a payment) because of a
Unitholder's status or otherwise specifically attributable to a Unitholder
(including, without limitation, federal withholding taxes with respect to
foreign partners, state personal property taxes, state unincorporated business
taxes, etc.), then such Unitholder (the "Indemnifying Person") shall indemnify
the LLC in full for the entire amount paid (including, without limitation, any
interest, penalties and expenses associated with such payments). The amount to
be indemnified shall be charged against the Capital Account of the Indemnifying
Person, and, promptly upon notification of an obligation to indemnify the LLC,
the Indemnifying Person shall make a cash payment to the LLC equal to the full
amount to be indemnified (and the amount paid shall be added to the
Indemnifying Person's Capital Account but shall not be treated as Capital
Contributions).
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ARTICLE V
MANAGEMENT
Section 5.1 Management Authority.
(a) The LLC shall be managed by the Common Members and,
except as otherwise provided in this Agreement (including without limitation
Section 2.2 hereof) or by the Act, any action required to be taken by the
Common Members shall be taken at the direction of the Required Common Members.
Except as otherwise provided herein and with respect to certain
responsibilities assigned to the Tax Matters Partner, all day-to-day LLC
management and operation decisions and determinations relating to the
operations of the LLC in the ordinary course of business shall be made by the
Common Members. The Common Members authorized by this Agreement to approve or
take any action on behalf of the LLC, in connection with the taking of such
action, may designate one or more Members or other Persons to act on behalf of
the LLC, at the direction of the Required Common Members, including, without
limitation, to execute and deliver documents. Any action taken by a Member or
other Person designated by the preceding sentence shall be effective to bind
the LLC.
(b) In establishing record dates for decisions to be
taken by any Members at a meeting of Members, notice of voting shall be given
to all Members who, in accordance with this Agreement, could convert their
Units into the Units making such decision and thereby qualify to vote on such
issue not less than ten (10) days prior to the date of such vote and the record
date for such vote shall not be earlier than five (5) days prior to the date of
such vote, unless such notice is waived by each Member. The record date for
any action to be taken by written consent pursuant to Section 2.2(d) shall be
the effective date of such consent.
(c) The LLC may, by action of the Required Common
Members, designate one or more committees. Each committee, to the extent
expressly provided in the resolution establishing such committee, shall have
and may exercise all of the authority of the Common Members in the management
of the business and property of the LLC except to the extent expressly
restricted by law, the Certificate or this Agreement.
Section 5.2 Directors of MMHC. The LLC shall vote the
shares of capital stock of MMHC (or any successor by merger to MMHC) owned by
the LLC in whatever manner is necessary to effectuate and carry out the
following provisions:
(a) MMHC (or such successor) shall at all times be
managed by or under the direction of a Board of Directors consisting of at
least the following members:
(i) The Chief Executive Officer of MMHC (or such
successor);
(ii) A designee of CVC; and
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(iii) An independent director, designated jointly
by CVC and the Members who at such time are executive officers of MMHC
or such successor (the "MMHC Management Members").
If the size of MMHC's (or such successor's) Board of Directors
is increased to consist of more than three persons, each such increase shall be
effected by adding both one or more designees of CVC and one or more designees
of the MMHC Management Members at the same time. For example, if the MMHC's
(or such successor's) Board of Directors is increased to consist of five
members, such five members will be the Chief Executive Officer of MMHC (or such
successor), two designees of CVC, an independent director designated jointly by
CVC and the MMHC Management Members and a designee of the MMHC Management
Members.
(b) In the event that any vacancy is created on MMHC's
(or such successor's) Board of Directors by reason of the death, resignation or
removal of any director, such vacancy shall be filled by a substitute director
designated by the party or parties entitled to designate the director whose
death, resignation or removal created such vacancy.
(c) Each holder of Units that are exchangeable for any
securities of MMHC (or any successor by merger to MMHC) agrees that, following
receipt of any voting securities of MMHC (or such successor) upon any exchange
pursuant to Section 2.8, and prior to any underwritten public offering of
equity securities by MMHC (or such successor), such holder will vote all of its
voting securities of MMHC (or such successor) obtained upon such exchange in a
manner so that the Board of Directors of MMHC (or such successor) shall consist
of persons prescribed pursuant to this Section 5.2.
Section 5.3 Indemnification of Each Member and Economic
Owner. Except as limited by law and subject to the provisions of Sections 5.3,
5.4 and 5.5, each Member and Economic Owner shall be entitled to be indemnified
and held harmless on an as incurred basis by the LLC (but only after first
making a claim for indemnification available from any other source and only to
the extent indemnification is not provided by that source) to the full extent
permitted under the Act as in effect from time to time against all losses,
liabilities and expenses, including attorneys' fees and expenses, arising from
proceedings in which such Member or Economic Owner may be involved, as a party
or otherwise, by reason of his being or having been a Member or Economic Owner
of the LLC, or by reason of his involvement in the management of the affairs of
the LLC (including by virtue of acting as an officer, director or employee of a
Portfolio Company or Portfolio Company Subsidiary), whether or not he continues
to be such at the time any such loss, liability or expense is paid or incurred,
but only to the extent that he (i) acted in good faith, (ii) acted in a manner
he reasonably believed to be authorized or conferred upon him by this
Agreement, (iii) acted in a manner he reasonably believed at the time of such
action to be in the best interests of the LLC, a Portfolio Company or a
Portfolio Company Subsidiary, as applicable and (iv) was neither grossly
negligent nor engaged in willful malfeasance. The rights of indemnification
provided in this Section 5.3 will be in addition to any rights to which such
Member or Economic Owner may otherwise be entitled by contract (including any
Unit Purchase Agreement) or as a matter of law and shall extend
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to his successors and assigns. Each Member's or Economic Owner's right to
indemnification hereunder for reasonable expenses (as incurred), including
attorneys' fees and expenses, incurred by such Member or Economic Owner may be
conditioned upon the delivery by such Member or Economic Owner to the LLC of a
written undertaking (reasonably acceptable to the Required Common Members) to
repay such amount if such Member or Economic Owner is determined pursuant to
this Section 5.3 or adjudicated to be ineligible for indemnification, which
undertaking shall be an unlimited general obligation but need not be secured.
Section 5.4 Heirs and Personal Representatives. The
indemnification provided by Section 5.3 hereof shall inure to the benefit of
the heirs and personal representatives of each Member and Economic Owner.
Section 5.5 Non-Exclusivity. The provisions of Section
5.3 hereof shall not be construed to limit the power of the LLC to indemnify
its Members, Economic Owners, managers, officers, employees or agents (or any
officer, director or employee of a Portfolio Company or a Portfolio Company
Subsidiary) to the full extent permitted by law or to enter into specific
agreements, commitments or arrangements for indemnification permitted by law,
including Unit Purchase Agreements. The absence of any express provision for
indemnification herein shall not limit any right of indemnification existing
independently of Section 5.3 hereof.
Section 5.6 Transfer of Membership Interest.
(a) The voting rights of any Member's Membership Interest
shall automatically terminate upon any Transfer of such interest to an estate,
heir, beneficiary, trust, guardian or conservator or upon any other Transfer if
the transferor no longer retains control over such voting rights and the
Required Common Members have not consented in writing to such transferee
becoming a substitute Member. As a condition to any Transfer of a Member's
Membership Interest or an Economic Owner's Economic Interest, the transferor
and the transferee shall provide such legal opinions and documentation as the
Required Common Members shall reasonably request.
(b) Notwithstanding anything to the contrary contained in
this Section 5.6 or elsewhere in this Agreement, a transferee or assignee of a
Member's Membership Interest shall not become a substitute Member without the
consent of the Required Common Members (which consent may be granted or
withheld in their sole discretion) and without executing a copy of this
Agreement or an amendment hereto in form and substance satisfactory to the
Required Common Members. Any substitute Member admitted to the LLC with such
consent and approval shall succeed to all rights and be subject to all the
obligations of the transferring or assigning Member with respect to the
Membership Interest to which such Member was substituted. No transferee of a
Member's Membership Interest may further transfer such interest without
complying with the provisions of this Section 5.6.
(c) The transferor and transferee of any Member's
Membership Interest or Economic Owner's Economic Interest shall be jointly and
severally obligated to reimburse the LLC
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for all reasonable expenses (including attorneys' fees and expenses) of any
Transfer or proposed Transfer, whether or not consummated.
(d) The transferee of any Member's Membership Interest or
Economic Owner's Economic Interest permitted under this Section 5.6 shall be
treated as having made all of the Capital Contributions made by, and received
all of the Distributions made to, the transferor of such interest prior to the
date of such Transfer.
(e) Notwithstanding anything to the contrary in this
Agreement, no Unit or Economic Interest may be transferred if such Transfer
would result in the LLC having more than (i) 50 "beneficial owners" as defined
and determined by the Investment Company Act of 1940, as amended from time to
time or (ii) 50 partners as determined under Treasury Regulation Section
1-7704-1(h).
(f) In the event that the Units held by any Member or
Economic Owner shall be subject to sale or other Transfer by reason of (i)
bankruptcy or insolvency proceedings, whether voluntary or involuntary, (ii)
distraint, levy, execution or other involuntary transfer or (iii) proceedings
or other actions to enforce a security interest in the Units, then such Member
or Economic Owner shall give the LLC written notice thereof promptly, stating
the terms of such proposed transfer, the identity of the proposed transferee,
the price or other consideration, if readily determinable, for which the Units
are proposed to be transferred, and the number of Units to be transferred.
After its receipt of such notice or, failing such receipt, after the LLC
otherwise obtains actual knowledge of such a proposed transfer, the LLC or its
designee shall have the right to purchase all, but not less than all, of such
Units at the price and on the terms applicable to such proposed transfer, which
right shall be exercised by written notice given by the LLC to the party
proposing to effect such transfer within 90 days following the LLC's obtaining
knowledge of such proposed transfer. The closing of the purchase and sale of
Units shall be held at the principal office of the LLC on a date to be
established by the LLC, which in no event shall be less than ten or more than
30 days from the date on which the LLC gives notice of its election to purchase
shares. If the nature of the event giving rise to such involuntary transfer is
such that no readily determinable consideration is to be paid for the transfer
of the Units, the price to be paid by the LLC or its designee shall be (i) the
original cash purchase price for the Preferred Units and (ii) Book Value Price
(as hereinafter defined) for shares of Common Units. "Book Value Price" shall
equal the net worth of the LLC per Common Unit of the Series of Units involved
(adjusted to reflect the exercise in full of any dilutive securities),
reflected in the LLC's (or Series') financial statements as of the end of the
most recent fiscal year.
(g) Promptly upon any transfer of a Unit, the Investment
Schedule relating to such Unit shall be amended to reflect such transfer.
(h) (i) Notwithstanding anything in this Agreement,
at any time and from time to time, CVC and CCT shall each have the
right to Transfer the Units which it holds to officers, directors or
employees of CVC or CCT, as applicable, or any partnership or other
31
35
investment vehicle in accordance with either CVC's or CCT's respective
co-investor programs, as they may exist from time to time.
(ii) CVC or CCT, as applicable, shall send a
notice to the LLC at least two (2) business days prior to any Transfer
permitted by (i) above. Upon execution of this Agreement by any
transferee permitted by (i) above, such transferee shall automatically
become a Member. The Members shall take such action or cause the LLC
to take such actions as are necessary to record the Transfers of
Units, list the transferees as Members on the Schedule of Members, if
applicable, and amend the applicable Investment Schedules. All
expenses incurred by the LLC pursuant to this Section 5.6(h) shall be
paid or reimbursed by CVC or CCT, as applicable.
Section 5.7 Admission of New Members. Other than with
respect to Participating Unitholders as set forth in Section 3.1(b), additional
Persons may be admitted to the LLC as Members ("New Members") only upon the
approval of the Required Common Members upon such terms as are established by
the Required Common Members, which may include the establishment of classes or
groups of Members having different relative rights, powers and duties,
including, without limitation, rights and powers which are superior or inferior
to those of existing Members, or the right to vote as a separate class or group
on specified matters by amendment of this Agreement. New Members shall be
admitted at the time when all conditions to their admission have been
satisfied, as determined by the Required Common Members, and their identity,
and, if applicable, the Units to be acquired by such New Members shall be
established by amendment of the Schedule of Members in accordance with the
conditions set forth in Section 10.1.
Section 5.8 Withdrawal, Expulsion or Other Termination of
Members.
(a) A Member may withdraw from the LLC but only if he has
given the LLC at least 30 days' written notice in advance of the effective date
of such withdrawal and upon such withdrawal such Person shall cease to be a
Member.
(b) A Member shall automatically cease to be a Member as
a result of his death or incapacity.
Section 5.9 Share of a Terminated Member. In the event
that a Member becomes a Terminated Member, such Terminated Member or his or her
estate shall retain such Terminated Member's Units and Capital Account as
adjusted pursuant to the terms hereof and shall be deemed an Economic Owner
only with respect to such Units and Capital Account hereunder. The Terminated
Member shall have no right pursuant to Section 18-604 of the Act to receive the
fair value of its Units.
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36
Section 5.10 Termination of a Member.
(a) The death, incapacity, withdrawal, incapacity,
bankruptcy or other termination of a Member shall not affect the existence of
the LLC, and the remaining Members shall continue the business of the LLC under
the terms of this Agreement. Thereafter, the Terminated Member shall no longer
be a Member for purposes of this Agreement and shall have no rights, except as
otherwise provided herein.
(b) A Terminated Member shall not be entitled to
participate in any LLC decision or determination (including, without limitation
voting or consent rights with respect to amendments to this Agreement, or
otherwise, except as provided herein), and his successors and assigns will
acquire only such Terminated Member's Economic Interest as an Economic Owner.
ARTICLE VI
DURATION; DISSOLUTION
Section 6.1 Duration. The LLC shall have a perpetual
existence; provided, however, that subject to the provisions of Section 2.2(c),
the LLC shall dissolve upon the written consent of the Required Common Members.
Section 6.2 Liquidation of LLC Interests.
(a) Upon dissolution of the LLC, with respect to the
disposition of the LLC's investment in each Portfolio Company, the Class A
Member with the greatest aggregate Capital Account balance attributable to the
LLC's investment in such Portfolio Company shall be the "Liquidator" with
respect thereto, unless and until a successor Liquidator is appointed as
provided herein. Each Liquidator shall agree not to resign at any time without
30 days' prior written notice. Any Liquidator may be removed at any time, with
or without cause, by notice of removal and appointment of a successor
Liquidator approved by the Required Common Members (and subject to the approval
of CVC if CVC has such right of approval pursuant to Section 2.2(d)) with
respect to the related Portfolio Company Investment. Within 30 days following
the death, dissolution, insanity, bankruptcy, retirement, resignation,
withdrawal or expulsion of the Class A Member who is acting as Liquidator
pursuant to this Section 6.2(a), a successor Liquidator may be elected by the
Required Common Members (and subject to the approval of CVC if CVC has such
right of approval pursuant to Section 2.2(d)) with respect to the related
Portfolio Company Investment. The successor Liquidator shall succeed to all
rights, powers and duties of the former Liquidator. The right to appoint a
successor or substitute Liquidator in the manner provided herein shall be
recurring and continuing for so long as the functions and services of the
Liquidator are authorized to continue under the provisions hereof, and every
reference herein to the Liquidator shall be deemed to refer also to any such
successor or substitute Liquidator appointed in the manner herein provided.
Except as expressly provided in this Article VI, any Liquidator appointed in
the manner provided herein shall have and may exercise without further
authorization or consent of any of the parties hereto, all of the powers
conferred upon the Common Members with respect to any Portfolio Company
33
37
Investment under the terms of this Agreement (but subject to all of the
applicable limitations, contractual and otherwise, upon the exercise of such
powers to the extent necessary or desirable in the good faith judgment of any
Liquidator to carry out the duties and functions of the Liquidator hereunder
for and during such period of time as shall be reasonably required in the good
faith judgment of any Liquidator to complete the winding up and liquidation of
the LLC as provided for herein).
(b) The Liquidator, with respect to the LLC's investment
in any Portfolio Company, shall liquidate the assets of the LLC, and apply and
distribute the proceeds of such liquidation, in the following order of
priority, unless otherwise required by mandatory provisions of applicable law:
(i) First, to the payment of the LLC's debts and
obligations to its creditors, including sales commissions and other
expenses incident to any sale of the assets of the LLC and including
Members who are creditors (but excluding liabilities to Members for
distributions under Section 18-606 of the Act), to the extent
permitted by law, whether by payment or the making of reasonable
provisions for payment thereof.
(ii) Second, to the establishment of and additions
to such reserves as the Liquidator, with respect to the LLC's
investment in any Portfolio Company, may deem necessary or
appropriate.
(iii) Third, to the Unitholders, in accordance with
Section 4.1.
The reserves established pursuant to clause (ii) above shall be paid over by
the Liquidator to a bank or other financial institution, to be held in escrow
for the purpose of paying any such contingent or unforeseen liabilities or
obligations and, at the expiration of such period as the Liquidator deems
devisable, such reserves shall be distributed to the Members in the priorities
set forth in this Section 6.2(b).
ARTICLE VII
VALUATION
Section 7.1 Valuation. With respect to the valuation of
any property distributed to any Member or Economic Owner with respect to any
Portfolio Company or Portfolio Company Subsidiary, such property shall be
valued at the fair market value thereof determined in good faith by the
Required Common Members with respect to such Portfolio Company Investment.
Section 7.2 Objection to Valuation. If the holders of 66
2/3% of the Common Units of the Series to which such property relates and 66
2/3% of each class of Preferred Units of the Series to which such property
relates object to the valuation of any property, then the Required Common
Members shall cause a mutually acceptable independent investment banking or
appraisal firm to
34
38
review such valuation, and such expert's determination shall be binding upon
all of Members and Economic Owners.
ARTICLE VIII
BOOKS OF ACCOUNT
Section 8.1 Books. The LLC shall maintain complete and
accurate books of account of the LLC's affairs at the LLC's principal office,
which books shall be open to inspection by any Member (or by any Economic
Owner, upon reasonable request which may be accepted or denied by the Required
Common Members at their sole discretion) at any time during ordinary business
hours in accordance with Section 2.5.
Section 8.2 Tax Matters Partner and Reports.
(a) So long as it continues to be a Member, CVC shall act
as the "Tax Matters Partner" (as defined in Section 623 1 (a)(7) of the Code)
in accordance with Sections 6221 through 6233 of the Code. If CVC ceases to be
a Member, the Required Common Members shall designate a replacement Tax Matters
Partner. If the Required Common Members fail to designate a replacement Tax
Matters Partner, the Member owning the greatest number of Common Units shall
serve as the Tax Matters Partner.
(b) Within 75 days after the end of each fiscal year, the
Tax Matters Partner shall cause the LLC to furnish each Unitholder with a copy
of the LLC's tax return and Form K- I for such fiscal year.
(c) The Tax Matters Partner may make a Code Section 754
election and any other elections that it deems advisable for tax purposes.
ARTICLE IX
MISCELLANEOUS
Section 9.1 No Incurrence of Indebtedness. The LLC shall
be prohibited from incurring, guaranteeing, or otherwise becoming liable in
respect of any indebtedness (as defined in accordance with generally accepted
accounting principles), including but not limited to indebtedness of any
Portfolio Company.
Section 9.2 Amendment. Subject to the other provisions
of this Agreement, this Agreement and the Schedules hereto may be amended only
by the prior written consent of the Required Common Members; provided, that any
amendment (other than in connection with an admission of a New Member pursuant
to Section 5.7) which adversely affects a Member's allocations or distributions
under Article IV or the rights of the Units owned by such Member to receive
Exchange Property shall not be effective with respect to such Member, unless;
such Member consents thereto in writing.
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39
Section 9.3 Successors. Except as otherwise provided
herein, this Agreement shall inure to the benefit of and be binding upon the
Members, the Terminated Members, the Economic Owners and their legal
representatives, heirs, successors and permitted assigns.
Section 9.4 Governing Law: Severability. This Agreement
shall be construed in accordance with the laws of the State of Delaware. If it
is determined by a court of competent jurisdiction that any provision of this
Agreement is invalid under applicable law, such provision shall be ineffective
only to the extent of such prohibition or invalidity, without invalidating the
remainder of this Agreement.
Section 9.5 Notices. All notices, demands and other
communications to be given and delivered under or by reason of provisions under
this Agreement shall be in writing and shall be deemed to have been given when
personally delivered, mailed by first class mail (postage prepaid and return
receipt requested), sent by telecopy or sent by reputable overnight courier
service (charges prepaid) to the addresses or telecopy numbers set forth in
Schedule of Members hereto or to such other addresses or telecopy numbers as
have been supplied in writing to the LLC.
Section 9.6 Singular, Plural; Gender. Wherever from the
context it appears appropriate, each term stated in either the singular or the
plural shall include the singular and the plural, and pronouns stated in either
the masculine, the feminine or the neuter gender shall include the masculine,
feminine and neuter.
Section 9.7 Complete Agreement; Headings; Counterparts.
This Agreement terminates and supersedes all other agreements previously
entered into among any of the Members specifically relating to the subject
matter hereof. Descriptive headings are for convenience only and shall not
control or affect the meaning or construction of any provision of this
Agreement. This Agreement may be executed in any number of counterparts, any
one of which need not contain the signatures of more than one party, but all
such counterparts together shall constitute one agreement.
Section 9.8 No Third Party Beneficiaries. Nothing in
this Agreement is intended, nor shall anything herein be construed, to confer
any rights, legal or equitable, in any Person other than the Members and, to
the extent provided herein, Economic Owners, and their respective legal
representatives, heirs, successors and permitted assigns.
Section 9.9 Tax Status. The LLC is intended to qualify
for federal income tax purposes as a partnership that is not publicly traded.
No Member shall take any action inconsistent with such qualification, including
the filing of an election under Treasury Regulation Section 301.7701-3 to be
taxed as an association.
Section 9.10 Waiver of Jury Trial. Each of the parties
hereto waives to the fullest extent permitted by law any right it may have to
trial by jury in respect of any claim, demand, action, or cause of action
based on, or arising out of, under or in connection with this Agreement, or any
course of conduct, course of dealing, verbal or written statement or action of
any party hereto, in
36
40
each case whether now existing or hereafter arising, and whether in contract,
tort, equity or otherwise. The parties to this Agreement each hereby agrees
that any such claim, demand, action or cause of action shall be decided by
court trial without a jury and that the parties to this Agreement may file an
original counterpart of a copy of this Agreement with any court as evidence of
the consent of the parties hereto to the waiver of their right to trial by
jury. Each of the parties hereto waives any right it may have to trial by jury
in respect of any litigation based on, arising out of under or in connection
with this Agreement or any course of conduct, course of dealing, verbal or
written statement or action of any party hereto.
Section 9.11 Waiver. Except as expressly provided herein
to the contrary, no failure to exercise any right, power or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of any
other right, power or privilege granted hereunder.
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IN WITNESS WHEREOF, the parties hereto have caused this
Limited Liability Company Agreement to be signed as of the date first above
written.
ALCHEMY, L.P.
c/o Citicorp Venture Capital Ltd.
000 Xxxx Xxxxxx, 00xx Xxxxx, Xxxx 0
Xxx Xxxx, XX 00000
By: /s/ XXXXXX X. XxXXXXXXXX
-------------------------------------------------
Its: General Partner
------------------------------------------------
42
CITICORP VENTURE CAPITAL LTD.
000 Xxxx Xxxxxx, 00xx Xxxxx, Xxxx 0
Xxx Xxxx, XX 00000
By: /s/ XXXXXX X. XxXXXXXXXX
-------------------------------------------------
Its: Managing Director
------------------------------------------------
43
CCT PARTNERS III
c/o Citicorp Venture Capital Ltd.
000 Xxxx Xxxxxx, 00xx Xxxxx, Xxxx 0
Xxx Xxxx, XX 00000
By: /s/ XXXXXX X. XXXXXXXX
-------------------------------------------------
Its: Secretary and Treasurer
------------------------------------------------
44
XXXXXXX X. XXXXXXX
00000 XX 00
Xxx Xxxxx, XX 00000
By: /s/ XXXXXXX X. XXXXXXX
-------------------------------------------------
45
XXXXXX X. XXXXX
00000 Xxxxxxxxxx Xxxxx
Xxxxxxx, XX 00000
By: /s/ XXXXXX X. XXXXX
-------------------------------------------------
46
XXXXXXX X. XXXXXX
00 Xxxxxx Xxxxxx, Xxx. 0-X
Xxx Xxxx, XX 00000
By: /s/ XXXXXXX X. XXXXXX
-------------------------------------------------
47
XXXXXXX X. COMFORT
c/o Citicorp Venture Capital Ltd.
000 Xxxx Xxxxxx, 00xx Xxxxx, Xxxx 0
Xxx Xxxx, XX 00000
By: /s/ XXXXXXX X. COMFORT
-------------------------------------------------
48
XXXXX X. XXXX
c/o Citicorp Venture Capital Ltd.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
By: /s/ XXXXX X. XXXX
-------------------------------------------------
49
XXXXX X. XxXXXX
0000 Xxxxxxx Xxxxxxx Xxxxx
Xxxxxxxx, XX 00000
By: /s/ XXXXX X. XxXXXX
-------------------------------------------------
50
XXXXXX X. XxXXXXXXXX
c/o Citicorp Venture Capital Ltd.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
By: /s/ XXXXXX X. XxXXXXXXXX
-------------------------------------------------
51
XXXXXXX X. XXXXXXX
000 Xxxxx Xxxxx Xxxx
Xxxxxxxxxxx, XX 00000
By: /s/ XXXXXXX X. XXXXXXX
-------------------------------------------------
52
XXXXXX X. XXXXXXX
c/o MMI Products, Inc.
000 Xxxx Xxxxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
By: /s/ XXXXXX X. XXXXXXX
-------------------------------------------------
53
XXXXX X. XXXXXX
000 Xxxxxxxx Xxxxxx
Xxx, XX 00000
By: /s/ XXXXX X. XXXXXX
-------------------------------------------------
54
XXXXX X. XXXX
c/o Citicorp Venture Capital Ltd.
000 Xxxx Xxxxxx, 00xx Xxxxx, Xxxx 0
Xxx Xxxx, XX 00000
By: /s/ XXXXX X. XXXX
-------------------------------------------------
55
XXXXXXX XXXXXX
0000 Xxxxx Xxxx Xxxxx
Xxxxxxxx, XX 00000
By: /s/ XXXXXXX XXXXXX
-------------------------------------------------
56
XXXX X. XXXXXX
0000 Xxxxx Xxxxx Xxxxx
Xxxxx, XX 00000
By: /s/ XXXX X. XXXXXX
-------------------------------------------------
57
EXHIBIT A - EXCHANGE NOTICE
[Name and Address of Unitholder]
MMI Products, L.L.C.
c/o MMI Products, Inc.
000 Xxxx Xxxxxx Xxxx
Xxxxx 000
Xxxxxxx, Xxxxx 00000
Re: Limited Liability Company Agreement of MMI Products, Inc.,
dated as of June 12, 1997 (the "Agreement")
Ladies and Gentlemen:
All capitalized terms used and not defined in this letter shall have
the meanings assigned to them in the Agreement.
This letter will constitute an Exchange Notice pursuant to Section
2.8(e) of the Agreement. The undersigned desires to exchange the undersigned's
[insert type and Series of units] for the Exchange Property corresponding
thereto pursuant to Section [2.5(a)(i)] of the Agreement. Such exchange shall
take place on [date].
Very truly yours,
-----------------------------
58
SCHEDULE OF MEMBERS
(as of June 12, 1997)
Alchemy, L.P. Xxxxx X. XxXxxx
c/o Citicorp Venture Capital Ltd. 0000 Xxxxxxx Xxxxxxx Xxxxx
000 Xxxx Xxxxxx, 00xx Xxxxx, Xxxx 0 Xxxxxxxx, XX 00000
Xxx Xxxx, XX 00000
Xxxxxx X. XxXxxxxxxx
Citicorp Venture Capital Ltd. c/o Citicorp Venture Capital Ltd.
000 Xxxx Xxxxxx, 00xx Xxxxx, Xxxx 0 000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
CCT Partners III Xxxxxxx X. Xxxxxxx
c/o Citicorp Venture Capital Ltd. 000 Xxxxx Xxxxx Xxxx
000 Xxxx Xxxxxx, 00xx Xxxxx, Xxxx 0 Xxxxxxxxxxx, XX 00000
Xxx Xxxx, XX 00000
Xxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx c/o MMI Products, Inc.
20162 CR 46 000 Xxxx Xxxxxx Xxxx, Xxxxx 000
Xxx Xxxxx, XX 00000 Xxxxxxx, Xxxxx 00000
Xxxxxx X. Xxxxx Xxxxx X. Xxxxxx
00000 Xxxxxxxxxx Xxxxx 000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000 Xxx, XX 00000
Xxxxxxx X. Xxxxxx Xxxxx X. Xxxx
10 Xxxxxx Square, Apt. 8-G c/o Citicorp Venture Capital Ltd.
Xxx Xxxx, XX 00000 000 Xxxx Xxxxxx, 00xx Xxxxx, Xxxx 0
Xxx Xxxx, XX 00000
Xxxxxxx X. Comfort
c/o Citicorp Venture Capital Ltd. Xxxxxxx Xxxxxx
000 Xxxx Xxxxxx, 00xx Xxxxx, Xxxx 4 0000 Xxxxx Xxxx Xxxxx
Xxx Xxxx, XX 00000 Xxxxxxxx, XX 00000
Xxxxx X. Xxxx Xxxx X. Xxxxxx
c/o Citicorp Venture Capital Ltd. 5214 Xxxxx Xxxxx Court
000 Xxxx Xxxxxx, 00xx Xxxxx Xxxxx, XX 00000
Xxx Xxxx, XX 00000
59
INVESTMENT SCHEDULE A
(AS OF JUNE 12, 1997)
1. Name of Portfolio Company: Merchants Metals Holding Company, a Delaware corporation ("MMHC")
-------------------------
c/o MMI Products, Inc.
000 Xxxx Xxxxxx Xxxx
Xxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxx
Facsimile No.: 000-000-0000
A. Portfolio Company Securities Purchased: 112,922 shares of Class A common stock, par value $.01 per share
--------------------------------------
("Class A Common")
658,982 shares of Class B common stock, par value $.01 per share
("Class B Common")
B. Date of Investment: June 12, 1997
------------------
C. Invested Capital and Units Issued: (All capital contributions were made as of June 12, 1997, unless
---------------------------------
otherwise indicated)
Number of Capital Form of Capital
Type of Units Participating Unitholder Units Held Contribution Contribution
------------- ------------------------ ---------- ------------ ------------
Class A Common Xxxxxxx X. Xxxxxxx 7,520 $7,520 Securities
Xxxxxx X. Xxxxx 58,902 $58,902 Securities
Xxxxx X. XxXxxx 13,850 $13,850 Securities
Xxxxxxx X. Xxxxxxx 5,540 $5,540 Securities
Xxxxxx X. Xxxxxxx 7,500 $7,500 Securities
Xxxxxxx Xxxxxx 9,160 $9,160 Securities
Xxxx X. Xxxxxx 10,450 $10,450 Securities
60
Number of Capital Form of Capital
Type of Units Participating Unitholder Units Held Contribution Contribution
------------- ------------------------ ---------- ------------ ------------
Class B Common Xxxxxxx X. Xxxxxx 7,484 $7,484 Securities
CCT Partners III 87,789 $87,789 Securities
Citicorp Venture Capital Ltd. 497,473 $497,473 Securities
Xxxxxxx X. Comfort 34,154 $34,154 Securities
Xxxxx X. Xxxx 267 $267 Securities
Xxxxxx X. XxXxxxxxxx 17,014 $17,014 Securities
Xxxxx X. Xxxxxx 7,484 $7,484 Securities
Xxxxx X. Xxxx 401 $401 Securities
D. Portfolio Company Subsidiary: MMI Products, Inc., a Delaware corporation
----------------------------
000 Xxxx Xxxxxx Xxxx
Xxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxx, President
Facsimile No.: 000-000-0000
