OPERATING AGREEMENT OF COMPASS GROUP DIVERSIFIED HOLDINGS LLC Dated as of November 18, 2005
Exhibit 3.4
OF
COMPASS GROUP DIVERSIFIED HOLDINGS LLC
Dated as of November 18, 2005
This OPERATING AGREEMENT shall be effective as of the 17th day of November 2005, and is
entered into by Compass Group Management LLC (together with its successors and assigns, the
“Member”), as the sole member hereunder and pursuant to the provisions of the Act as in effect on
the date hereof. Capitalized terms used in this Agreement without definition shall have the
respective meanings specified in Article II.
RECITALS
A. The Company was formed on the date hereof, upon the filing of the
Certificate of Formation with the Secretary of State of Delaware.
B. The Member wishes to enter into this Agreement to establish the rules and
procedures that are to govern the business and affairs of the Company.
NOW, THEREFORE, the Member, intending to be legally bound, does hereby adopt the operating
agreement of the Company as follows:
ARTICLE I
FORMATION
1.1. Formation. The Company is formed as a limited liability company under and
pursuant to the provisions of the Act and upon the terms and conditions set forth herein. The
rights and obligations of the Member and the terms and conditions of the Company shall be
governed by the Act and this Agreement. To the extent the Act and this Agreement are
inconsistent with respect to any subject matter covered in this Agreement, this Agreement
shall govern, but only to the extent permitted by law.
1.2. Name. The name of the Company shall be Compass Group Diversified
Holdings LLC.
1.3. Purposes. The purposes of the Company shall be to engage in any activity
permissible for a limited liability company under the Act, all on the terms and conditions and
subject to the limitations set forth in this Agreement.
1.4. Principal Place of Business; Registered Agent; Registered Office. The principal
executive offices of the Company are at 00 Xxxxxx Xxxx, Xxxxxxxx XX 00000. The Company’s registered
agent for service of process in the State of Delaware shall be The Corporation Trust Company in the
City of Wilmington, in the County of New Castle, in the State
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of Delaware. The registered agent’s address and the address of the Company’s registered office
in the State of Delaware is 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000.
1.5. Commencement and Term. The term of the Company commenced at the
time and date appearing in the Certificate of Formation and shall continue until in
perpetuity,
unless it is sooner dissolved, its affairs are wound up and final liquidating distributions
are made pursuant to this Agreement.
1.6. Title to Assets; Transactions. The Company shall keep title to all of its
assets in its own name and not in the name of its Member. The Company shall enter into and
engage in all transactions in its own name and not in the name of its Member.
1.7. Certificates. Each member of the Board of Directors of the Company is hereby
designated as an “authorized person” of the Company within the meaning of the Act and is
authorized to execute, deliver and file all documents permitted or required to be filed with the
Secretary of State of the State of Delaware, including the Certificate of Formation of the Company.
Any member of the Board of Directors of the Company shall execute, deliver and file any other
certificates (and any amendments and/or restatements thereof) necessary for the Company to qualify
to do business in Connecticut and in any other jurisdiction in which the Company may wish to
conduct business.
ARTICLE II
DEFINITIONS
2.1.
“Act” shall mean the Delaware Limited Liability Company Act, as in
effect in Delaware (or any corresponding provision of succeeding law), as amended from time to
time.
2.2.
“Affiliate” shall mean, with respect to the Member, any person or entity
that controls, is controlled by or under common control with the Member.
2.3.
“Agreement” shall mean this Operating Agreement, as amended from time
to time.
2.4.
“Capital Contribution” shall mean with respect to the Member, the
amount of money and any property (other than money) contributed to the Company with respect
to the Interest of such Member.
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2.5. “Certificate of Formation” shall mean the Certificate of Formation of the
Company filed pursuant to the Act together with any amendments thereto.
2.6. “Code” shall mean the Internal Revenue Code of 1986, as amended from
time to time, or any successor federal revenue law.
2.7. “Company” shall mean Compass Group Diversified Holdings LLC, the
limited liability company formed pursuant to the Certificate of Formation and this Agreement.
2.8. “Interest” shall mean the limited liability company interest, including all
of the economic rights, privileges, preferences and obligations of the Member, or successor or
assignee with respect to the Company created under this Agreement or under the Act.
2.9. “Person” shall mean any natural person, partnership, trust, estate,
association, limited liability company, corporation, custodian, nominee, governmental
instrumentality or agency, body politic or any other entity in its own or any
representative capacity.
ARTICLE III
INTERESTS; CAPITAL CONTRIBUTIONS
3.1 Interests. The Company shall be authorized to issue one class of limited liability
company interests (the “Interests”) in an aggregate amount of up to one hundred (100) of such
interests. The Interests shall be issued 100% to the Member. The Member shall have all the rights,
privileges and obligations set forth herein pertaining to holders of Interests. The Interests shall
not be certificated, and the ownership of the Interests from time to time shall be reflected on
Schedule A attached hereto. The Member shall have one vote per Interest.
3.2. Capital Contributions. As of the date hereof, the Member has made Capital
Contributions to the Company on the dates and in the amounts reflected on Schedule A
attached
hereto. The Member may (but shall not be obligated to) make additional Capital Contributions
in such form and at such time as the Member shall determine in the Member’s sole and absolute
discretion, which such additional Capital Contributions shall be evidenced in writing and
recorded on Schedule A attached hereto.
3.3. Liability of Member. Except as otherwise provided by applicable law, the
debts, obligations and liabilities of the Company, whether arising in contract, tort or
otherwise, shall be solely the debts, obligations and liabilities of the Company, and the Member (and its
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Affiliates) shall not be obligated personally for any such debt, obligation or liability of
the Company solely by reason of being a member (or an Affiliate thereof) of the Company.
ARTICLE IV
DISTRIBUTIONS
4.1. Distributions. To the maximum extent permitted by law, and subject to any
other contractual restrictions agreed to by the Company or its Member in writing, the Company shall
have authority to distribute cash or property to the Member, in such amounts, at such times and as
of such record dates as the Board of Directors shall determine. Notwithstanding any provision of
this Agreement to the contrary, the Company, and the Board of Directors on behalf of the Company,
shall not be required to make any distribution to any Member or any other Person on account of its
Interest if such distribution would violate Sections 18-607 or 18-804 of the Act or other
applicable law.
ARTICLE V
MANAGEMENT
5.1. Board of Directors. Except as otherwise expressly provided herein, the
business and affairs of the Company shall be managed by or under the direction of its Board of
Directors. Each director of the Company, when acting in such capacity, is a manager within the
meaning of Section 18-402 of the Act and as such is vested with the powers and authorities
necessary for the management of the Company, and is authorized to act individually on behalf of the
Company, in each case, subject to the terms of this Agreement. In addition to the powers and
authorities expressly conferred upon it by this Agreement, the Board of Directors and each director
acting individually may exercise all such powers of the Company and do all such lawful acts and
things as are not prohibited by applicable law or this Agreement required to be exercised or done
by the Member. For the avoidance of doubt, the Member is not a manager within the meaning of
Section 18-402 of the Act.
5.2. Initial Board. Initially, the Board of Directors shall be comprised of the
following individuals: I. Xxxxxx Xxxxxxx, C. Xxxx Xxx, Xxxxx Xxxxxxxxxxx, D. Xxxxxx Xxxxx, Xxxxxxxx
Xxxxxxx and Xxxxxx X. Xxxxxxx (each an “Initial Director” and, collectively, the “Initial Board”).
Each Initial Director shall hold office until his or her successor is elected or appointed and
qualified, or until his or her earlier death, resignation or removal in accordance with this
Article V. The Board of Directors (including, without limitation, the Initial Board) and
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each Director (including, without limitation, each Initial Director) shall have all of the powers
and authorities accorded to the Board of Directors under the terms of applicable law and this
Agreement.
5.3. Number, Tenure and Qualifications. As provided in Section 5.2, the Initial
Board shall be comprised of six (6) Initial Directors. Subject to this Section 5.3, the number
of directors shall be fixed from time to time exclusively pursuant to a resolution adopted by the
Board of Directors, but shall consist of not less than three (3) nor more than twelve (12)
directors. However, no decrease in the number of directors constituting the Board of Directors
shall shorten the term of any incumbent director. The term of each director shall be the
period from the effective date of such director’s election to the next annual meeting of the Member
and until such director’s successor is duly elected and qualified or until such director’s death,
resignation or removal. Directors need not be residents of the State of Delaware or a member
of the Company.
5.4.
Election of Directors. Except as provided in Section 5.2 and 5.7, directors
shall be elected at the annual meeting of the Member commencing with the first annual meeting
after the date hereof.
5.5. Removal. Any director may be removed from office, with or without cause,
by the Member. If any directors are so removed, new directors may be appointed by the Member
at the same meeting.
5.6. Resignations. Any director, whether elected or appointed, may resign at an
time upon notice of such resignation to the Company. If any director so resigns, a new
director may be appointed by the Member immediately following such resignation.
5.7. Vacancies and Newly Created Directorships. Except as otherwise provided
in Section 5.5, vacancies and newly created directorships resulting from any increase in the
authorized number of directors may be filled by the Member immediately following such
increase or vacancy.
5.8. Regular Meetings. A regular meeting of the Board of Directors shall be
held without any other notice immediately after, and at the same place (if any) as, each
annual meeting of the Member. The Board of Directors may, by resolution, provide the time and place
(if any) for the holding of additional regular meetings without any other notice than such
resolution.
5.9. Special Meetings; Waiver of Notice. Special meetings of the Board of
Directors shall be called at the request of the Member or any member of the Board of
Directors.
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The Person or Persons who call for a special meeting of the Board of Directors may fix the place
and time of such meeting. Notice of any special meeting of the Board of Directors shall be mailed,
postage prepaid, to each director at his or her business or residence no later than three (3) days
before the day on which such meeting is to be held or shall be sent to either of such places by
express courier service or facsimile (directed to the facsimile number to which the director has
consented to receive notice) or other electronic transmission (including, but not limited to, an
e-mail address at which the director has consented to receive notice), or be communicated to each
director personally or by telephone not later than one (1) day before such day of meeting. A
meeting may be held at any time without notice if all the directors are present or if those not
present waive notice of the meeting, either before or after such meeting.
5.10. Action Without Meeting. Any action required or permitted to be taken at
any meeting by the Board of Directors may be taken without a meeting, without a vote and
without prior notice, if a consent thereto is signed or transmitted electronically by a
majority of the members of the Board of Directors and the writing or writings or electronic transmission
or transmissions are filed with the minutes of proceedings of the Board of Directors;
provided, that such electronic transmission or transmissions must either set forth or be submitted with
information from which it can be determined that the electric transmission or transmissions
were authorized by the director.
5.11. Conference Telephone Meetings. Members of the Board of Directors may
participate in a meeting of the Board of Directors by means of conference telephone or other
communications equipment by means of which all persons participating in the meeting can hear
each other, and such participation in a meeting shall constitute presence in person at such
meeting.
5.12. Quorum. At all meetings of the Board of Directors, fifty percent (50%) of
the then total number of directors in office shall constitute a quorum for the transaction of
business. The act of a majority of the directors present at any meeting at which there is a
quorum shall be the act of the Board of Directors. If a quorum shall not be present at any meeting of
the Board of Directors, a majority of the directors present thereat may adjourn the meeting from
time to time without further notice other than announcement at the meeting. The members of the
Board of Directors present at a duly organized meeting at which a quorum is present may
continue to transact business until adjournment, notwithstanding the withdrawal of enough
members of the Board of Directors to leave less than a quorum.
5.13. Specific Authority of the Board of Directors. In furtherance of Section 5.1
above, except as otherwise provided herein, the Board of Directors shall have all right, power
and authority necessary, appropriate, desirable or incidental to carry out the conduct of the
Company’s business.
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5.14. Officers.
(a) Subject to this Section 5.14, the Board of Directors shall elect the officers
of the Company. Initially, the officers of the Company shall consist of a Chief Executive
Officer and Chief Financial Officer, as identified below. All officers elected by the Board of
Directors shall have such powers and duties as generally pertain to their respective offices, subject to
the specific provisions of this Section 5.14. Such officers shall also have powers and duties as
from time to time may be conferred by the Board of Directors. Any number of offices may be held by
the same Person, unless otherwise prohibited by applicable law or this Agreement. The officers
of the Company need not be members or directors of the Company. In furtherance of the
foregoing, I. Xxxxxx Xxxxxxx shall be the Chief Executive Officer and Xxxxx Xxxxxxxxxxx shall
be the Chief Financial Officer of the Company unless and until their successors shall have been
duly elected and qualified or until their death, resignation or removal. The Chief Executive
Officer and the Chief Financial Officer of the Company shall, subject to the oversight of the Board of
Directors, have those duties and responsibilities as may be prescribed by the Board of
Directors or this Agreement, from time to time. Any officer of the Company may resign at any time upon
notice of such resignation to the Company. Subject to this Section 5.14, a newly created
office and a vacancy in any office because of death, resignation or removal may be filled by the
Board of Directors.
(b) Notwithstanding anything to the contrary contained in this Agreement,
each officer of the Company is hereby authorized, without the vote, act or approval of the
Member, the Board of Directors or any other person or entity, on behalf of the Company, in its
discretion, (i) to prepare and file with the Securities and Exchange Commission (the
“Commission”) and execute, in each case on behalf of the Company, (a) a Registration Statement
on Form S-l (the “1933 Act Registration Statement”), including any pre-effective or post-
effective amendments thereto, relating to the registration of any Interests under the
Securities Act
of 1933, as amended (the “Securities Act”), (b) a Registration Statement filed pursuant to
Rule 462(b) under the Securities Act (the “462(b) Registration Statement” and, together with the
1933 Act Registration Statement, the “Registration Statements”), including any amendments
thereto, relating to the registration of any Interests under the Securities Act and (c) a
Registration Statement on Form 8-A (the “1934 Act Registration Statement”), including any pre-effective or
post-effective amendments thereto, relating to the registration of any Interests under Section
12(b) or (g) of the Securities Exchange Act of 1934, as amended, (ii) to prepare and file with
the Nasdaq National Market and/or any other securities exchange and execute, in each case on
behalf of the Company, a listing application and all other applications, statements, certificates,
agreements and other instruments as shall be necessary or desirable to cause any Interests to
be listed on the Nasdaq National Market and/or any other securities exchange, (iii) to prepare
and file and execute, in each case on behalf of the Company, such applications, reports, surety
bonds,
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irrevocable consents, appointments of attorney for service of process and other papers and
documents as shall be necessary or desirable to register any Interests under the securities or
“blue sky” laws of such jurisdictions as any officer may deem necessary or desirable, (iv) to
select underwriters or other placement agents relating to the public offering or any issuance of
any Interests pursuant to the Registration Statements, (v) to negotiate the terms of, and execute
on behalf of the Company, any underwriting agreements, purchase agreements or other agreements
relating to the public offering or any issuance of any Interests pursuant to the Registration
Statements, (vi) to engage any agents or other entities necessary to effect the public offering or
issuance of any Interests pursuant to the Registration Statements., (vii) to execute and deliver,
in each case on behalf of the Company, such certifications or reports required by the
Xxxxxxxx-Xxxxx Act of 2002 from time to time as may be necessary or proper to the conduct of the
business of the Company, (viii) to issue any Interests on a private placement basis to any Person,
(ix) to establish, create or otherwise sponsor a statutory trust
(a “Trust”) under Chapter 38 of
Title 12 of the Delaware Code, 12 Del.C. Section 3801, et seq., (x) to empower the Trust with such
rights, powers and privileges as any officer may deem necessary or advisable, including to empower
the Trust to undertake or perform any action permitted by this paragraph (b) on behalf of the
Trust, (xi) to pay any filing, application or other fees associated with any of the foregoing
actions, including those to the Commission, the National Association of Securities Dealers, any
securities exchange, any agents or any other Person, and (xii) to negotiate the terms of, and
execute on behalf of the Company, such agreements, documents and certificates, and to do such other
acts and things as any officer may deem to be necessary or advisable in order to (x) give effect to
any of the foregoing actions, (y) in connection with the public offering or any future issuance of
any Interests or (z) carry out the purpose and intent of the Company. For the avoidance of doubt,
it is hereby acknowledged and agreed that in connection with any execution, filing or document
referred to in clauses (i) — (xii) above, any officer singly is authorized on behalf of the Company
to file and execute such document on behalf of the Trust.
5.15. Member Vote. Notwithstanding any other provision of this Article 5, the
following actions shall require the written approval of the Member:
(a) the
sale, exchange, or other disposition of substantially all of the property and other assets of the Company; or
(b) the merger or consolidation of the Company with any other entity.
5.16. Limitation of Liability. Notwithstanding any other provision to the contrary
contained in this Agreement, no manager (as such term is defined in Section 18-402 of the Act)
or member of the Board of Directors shall be liable, responsible, or accountable in damages or
otherwise to the Company or to the Member or assignee of the Member for any loss, damage,
cost, liability, or expense incurred by reason of or caused by any act or omission performed or
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omitted by such manager or such member of the Board of Directors, whether alleged to be based upon
or arising from errors in judgment, negligence, or breach of duty (including alleged breach of any
duty of care or duty of loyalty or other fiduciary duty), except for (i) acts or omissions the
manager or the member of the Board of Directors knew at the time of the acts or omissions were
clearly in conflict with the interest of the Company, (ii) any transaction from which the manager
or member of the Board of Directors derived an improper personal benefit vis-a-vis the Company or
the Member, (iii) a willful breach of this Agreement or (iv) gross negligence, willful misconduct,
or knowing violation of law. Without limiting the foregoing, to the fullest extent permitted by
law, no manager or member of the Board of Directors shall in any event be liable for (A) the
failure to take any action not specifically required to be taken by the manager or the Board of
Directors under the terms of this Agreement, (B) any action or omission taken or suffered by any
other manager or member of the Board of Directors nor (C) any mistake, misconduct, negligence,
dishonesty or bad faith on the part of any agent of the Company appointed in good faith by the
Board of Directors.
5.17. Indemnification. To the fullest extent permitted by applicable law, the Company
shall indemnify the Member, each manager and member of the Board of Directors (“Indemnified
Person”) against any and all losses, claims, damages and liabilities incurred by the Indemnified
Person by reason of any act or omission performed or omitted by the Indemnified Person in good
faith on behalf of the Company and in a manner reasonably believed to be within the scope of
authority conferred on the Indemnified Person or by reason of being a member, manager or member of
the Board of Directors, except that no Indemnified Person shall be entitled to be indemnified in
respect of any loss, claim, damage or liability incurred by the Indemnified Person by reason of
gross negligence or willful misconduct with respect to such acts or omissions. Any indemnification
under this Section 5.17 shall be provided out of and to the extent of Company assets only.
ARTICLE VI
TRANSFER OF INTERESTS
6.1. Transfers. The Member shall have the power to transfer all or any part of its
Interest upon 30 days notice to the Board of Directors, or such shorter period consented to by
the Board of Directors.
6.2. Substituted Member. Any transferee of the Member’s Interest pursuant to
the terms of this Article 6 shall be admitted to the Company as a Member, such admission to be
effective immediately prior to such transfer, and such Member shall succeed to all rights and
obligations of the transferor Member.
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ARTICLE VII
DISSOLUTION, WINDING UP AND LIQUIDATING DISTRIBUTIONS
7.1. Dissolution Triggers. The Company shall dissolve only upon the First
to occur of the following events:
(a) The Member votes for dissolution; or
(b) Any other event causing dissolution of a limited liability company
under the Act.
7.2. Winding Up. Upon dissolution of the Company, the Board of Directors shall wind up
the Company’s affairs,
7.3. Liquidating Distributions. Following the dissolution of the Company, the assets
of the Company shall first be applied to satisfy (whether by payment or reasonable provision for
payment) claims of creditors, with any balance being distributed to the Member as provided in the
Act.
ARTICLE VIII
BOOKS AND RECORDS
8.1. Books and Records. The Company shall keep books and records at its
principal place of business. In all events, however, the Company shall keep books and records
separate from those of its Member and shall at all times segregate and account for all of its
assets and liabilities separately from those of its Member.
8.2. Bank Accounts. The Company may maintain one or more bank, securities,
brokerage or other accounts for such funds or other assets of the Company as it shall choose
to deposit therein, and withdrawals therefrom shall be made upon such signature or signatures as
the Board of Directors shall determine.
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ARTICLE IX
MISCELLANEOUS
9.1. Binding Effect. Except as otherwise provided in this Agreement, every
covenant, term and provision of this Agreement shall be binding upon and inure to the benefit
of the Member and its successors, transferees, and assigns.
9.2. Entire Agreement; No Oral Operating Agreements. This Agreement
constitutes the entire agreement with respect to the affairs of the Company and the conduct of
its business, and supersedes all prior agreements and understandings, whether oral or written. The
Company shall have no oral operating agreements.
9.3. Headings. Section and other headings contained in this Agreement are for
reference purposes only and are not intended to describe, interpret, define or limit the scope,
extent or intent of this Agreement or any provision hereof.
9.4. Severability. Every provision of this Agreement is intended to be severable.
If any term or provision hereof is illegal or invalid for any reason whatsoever, such
illegality or invalidity shall not affect the validity or legality of the remainder of this Agreement.
9.5.
Variation of Pronouns. All pronouns and any variations thereof shall be
deemed to refer to masculine, feminine or neuter, singular or plural, as the identity of the
Person or Persons may require.
9.6. Governing Law. The law of the State of Delaware, without regard to its
conflicts of law principles, shall govern this Agreement, including its validity, the
construction and interpretation of its terms, and organization and internal affairs of the Company and the
limited liability of its managers, directors, Member and other owners.
9.7. Amendments. This Agreement may be amended only by written instrument
executed by the Member.
[Signature page follows]
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IN WITNESS WHEREOF, the Member has executed this Agreement as of the date and year first
above written.
| MEMBER: | ||||
| COMPASS GROUP MANAGEMENT LLC | ||||
| By: | /s/ I. Xxxxxx Xxxxxxx | |||
| Name: I. Xxxxxx Xxxxxxx | ||||
| Title: Manager | ||||
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SCHEDULE A
Member Interests
| Agreed Value of | Limited Liability | |||||||||||||||
| Date of Capital | Capital | Company | ||||||||||||||
| Name | Mailing Address | Contribution | Contribution | Interest | ||||||||||||
Compass Group |
00 Xxxxxx Xxxx | November 18, 2005 | $100,000 | 100% | ||||||||||||
Management LLC |
Xxxxxxxx, XX 00000 | |||||||||||||||
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