Exhibit 10.16
AMENDED AND RESTATED
LIMITED LIABILITY COMPANY AGREEMENT
OF
OTAY LAND COMPANY, LLC
Limited Liability Company Agreement of OTAY LAND COMPANY,
LLC (the "LLC") dated as of September 20, 1999 among HOMEFED CORPORATION
("HFC") and LEUCADIA NATIONAL CORPORATION ("LUK," and collectively, the
"Members").
W I T N E S S E T H:
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WHEREAS, the Members desire to enter into this amended and
restated Agreement (the "LLC Agreement") to establish their respective rights
and obligations with respect to the LLC;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and provisions hereinafter contained, the Members hereby agree
as follows:
Article I
ORGANIZATIONAL AND OTHER MATTERS
SECTION 1.01. Formation; Admission. The LLC has been
organized under the provisions of the Limited Liability Company Act of the State
of Delaware (the "LLCA") by filing a Certificate of Formation with the Secretary
of State of the State of Delaware. Each of HFC and LUK has been admitted to the
LLC as a Member. All Members are required to hold an interest in the LLC; any
failure to hold such an interest shall result in immediate termination of one's
membership in the LLC.
SECTION 1.02. Name. The name of the LLC shall be OTAY LAND
COMPANY, LLC and the business of the LLC shall be conducted under such name.
SECTION 1.03. Principal Office. The principal office of the
LLC shall be at 000 Xxxx Xxxxx Xxxxxx, Xxxx Xxxx Xxxx, Xxxx 00000, or such other
place as may from time to time be determined.
SECTION 1.04. Term. The LLC shall commence on the date of
filing of the Certificate of Formation and shall continue until terminated as
provided in this Agreement or in the Certificate of Formation, as each such
document may be amended from time to time.
SECTION 1.05. Limited Liability. Except as otherwise
provided by the LLCA, the debts, obligations and liabilities of the LLC, whether
arising in contract, tort or otherwise, shall be the debts, obligations and
liabilities solely of the LLC, and the
Members shall not be obligated personally for any of such debts, obligations or
liabilities solely by reason of being a Member.
Article II
PURPOSE AND POWERS
SECTION 2.01. Purpose of the LLC. Except as may be
restricted by this Agreement, the LLC may carry on any lawful business, purpose
or activity permitted by the LLCA.
SECTION 2.02. Powers of the LLC. The LLC shall have the
power to do any and all acts reasonably necessary, appropriate, proper,
advisable, incidental or convenient to or for the furtherance of the purpose and
business described herein and for the protection and benefit of the LLC.
Article III
FUNDING CONTRIBUTIONS
SECTION 3.01. Funding Contributions. An initial investment
of $10,000,000 in the LLC has been made by HFC ("Capital"). Any additional
investments in the LLC to be made by HFC shall be treated as additional Capital.
An initial investment of $1,000 in the LLC has been made by LUK ("Preferred
Capital"). Any additional investments in the LLC to be made by LUK shall be
treated as additional Preferred Capital. Preferred Capital contributed by LUK
shall be entitled to receive a preferred return pursuant to Article IV hereof.
All Capital contributed by HFC and Preferred Capital contributed by LUK shall
together constitute Funding Contributions.
SECTION 3.02. Capital Accounts. The LLC shall maintain for
each Member a separate Capital Account.
SECTION 3.03. No Interest. Except as otherwise expressly
provided in this Agreement, no interest shall be paid by the LLC on
contributions of either Capital or Preferred Capital, balances in the Members'
Capital Accounts or any other funds contributed to the LLC or distributed or
distributable by the LLC under this Agreement.
SECTION 3.04. No Withdrawal; Return of Contributions. No
Member shall have the right to withdraw any portion of such Member's Capital
Account without the consent of LUK. Except as required by the LLCA, no Member
shall be personally liable to any other Member for the return of any capital or
any additions thereto, it being agreed that any return of capital as may be made
from time to time shall be made solely from the assets of the LLC and only in
accordance with the terms hereof.
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Article IV
DISTRIBUTIONS AND ALLOCATIONS
SECTION 4.01. Distribution of Profits. All proceeds
received by the LLC and available for distribution shall be distributed as
follows, in the following order of priority:
(i) to pay LUK an annual minimum cumulative preferred
return of 10% on all Preferred Capital provided by LUK;
(ii) to pay LUK an annual minimum cumulative preferred
return of 2% on all Preferred Capital provided by LUK; provided that
this 2% return shall be payable by the LLC only out of and to the
extent of profits;
(iii) to repay all Preferred Capital provided by LUK, it
being understood that upon payment in full of the preferred returns
pursuant to (i) and (ii) above and repayment in full of all Preferred
Capital the interest in the LLC represented by such Preferred Capital
shall be extinguished; and
(iv) any remaining funds will be distributed to the
remaining Member or Members in accordance with their capital accounts.
SECTION 4.02. Allocation of Profits and Losses. Profits and
losses of the LLC shall be allocated among the Members in accordance with
applicable federal tax laws. The profits of the LLC are allocated 100% to HFC
after consideration of the distributions to LUK in Section 4.01(i) and (ii) and
the losses of the LLC will be allocated 100% to HFC until HFC's capital account
is exhausted, then to LUK until LUK's capital account is exhausted, then in
accordance with applicable federal tax laws.
Article V
MANAGEMENT OF THE LLC
SECTION 5.01. Management. Subject to Sections 5.02 and 5.03
hereof, the management of the business and affairs of the LLC shall be vested in
the "Manager" who shall be selected by the majority vote of the Members. For
purposes of this Section 5.01, "majority vote" shall mean the vote of Members
who, at the time of such vote, shall have contributed a majority of the Funding
Contributions. However, the Manager may be removed by any Member for cause. For
purposes of this Section 5.01, "cause" shall mean any willful or reckless
failure to carry out its duties under this LLC Agreement. The initial Manager of
the LLC shall be HFC. The Manager shall have the power to do any and all acts
necessary or convenient for the furtherance of the purpose of the LLC described
in this Agreement, including all powers, statutory or otherwise, possessed by
members of a limited liability company under the LLCA. Xxxxxx X. Xxxxxxx is
hereby designated as an authorized person, within the meaning of the LLCA, to
execute, deliver and file the Certificate of Formation and any amendments and/or
restatements thereof required by law.
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SECTION 5.02. Authorized Officers. The Members may elect by
a majority vote officers with such titles as the Members deem appropriate. The
initial officers of the LLC shall be:
Xxxx Xxxxxx President
Xxxx Xxxx Treasurer and Secretary
Xxxxxxx Bienvenue Vice President
Xxxxxx X. Orlando Vice President
Xxxx Xxxxxx Vice President
The foregoing officers shall serve in such office until removed and replaced by
the majority vote of the Members.
SECTION 5.03. [Intentionally omitted]
SECTION 5.04. Liability of Members; Indemnification.
(a) To the fullest extent permitted by the laws of
Delaware, the LLC (i) shall indemnify and hold harmless LUK and its respective
officers, directors and shareholders for so long as LUK holds a preferred
capital interest in the LLC, and (ii) may indemnify and hold harmless each
Member and its respective officers, directors, shareholders, members or
partners, and each officer of the LLC (each of the parties listed in (i) and
(ii), an "Indemnitee"), from and against any and all losses, claims, demands,
costs, damages, liabilities (joint or several), expenses of any nature
(including reasonable attorneys' fees and disbursements), judgments, fines,
settlements and other amounts ("Damages") arising from any and all claims,
demands, actions, suits or proceedings, whether civil, criminal, administrative
or investigative, in which an Indemnitee may be involved, or threatened to be
involved, as a party or otherwise, arising out of or incidental to the business
of the LLC, regardless of whether an Indemnitee continues to be a Member or an
officer, director, shareholder, member or partner of such Member at the time any
such liability or expense is paid or incurred, except for any Damages based
upon, arising from or in connection with any act or omission of an Indemnitee
committed without authority granted pursuant to this Agreement or in bad faith
or otherwise constituting willful misconduct.
(b) Expenses (including reasonable attorneys' fees and
disbursements) incurred in defending any claim, demand, action, suit or
proceeding, whether civil, criminal, administrative or investigative, subject to
Section 5.04(a) hereof, may be paid (or caused to be paid) by the LLC in advance
of the final disposition of such claim, demand, action, suit or proceeding upon
receipt of an undertaking by or on behalf of the Indemnitee to repay such amount
if it shall ultimately be determined, by a court of competent jurisdiction from
which no further appeal may be taken or the time for any appeal has lapsed (or
otherwise, as the case may be), that the Indemnitee is not entitled to be
indemnified by the LLC as authorized hereunder or is not entitled to such
expense reimbursement.
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(c) The indemnification provided by Section 5.04(a) hereof
shall be in addition to any other rights to which an Indemnitee may be entitled
under any agreement or unanimous vote of the Members, as a matter of law or
otherwise, both (i) as to action in the Indemnitee's capacity as a Member or as
an officer, director, shareholder, member or partner of a Member, and (ii) as to
action in another capacity, and shall continue as to an Indemnitee who has
ceased to serve in such capacity and shall inure to the benefit of the heirs,
successors, assigns, administrators and personal representatives of the
Indemnitee.
(d) Any indemnification hereunder shall be satisfied only
out of the assets of the LLC, and the Members shall not be subject to personal
liability by reason of these indemnification provisions.
(e) An Indemnitee shall not be denied indemnification in
whole or in part under Section 5.04(a) hereof because the Indemnitee had an
interest in the transaction with respect to which the indemnification applies if
the transaction was otherwise permitted by the terms of this Agreement.
(f) No Member shall be liable, in damages or otherwise, to
the LLC or any other Member for any act or omission performed or omitted to be
performed by it in good faith pursuant to the authority granted to such Member
this Agreement of the LLCA.
Article VI
TRANSFER OF MEMBERSHIP INTERESTS
SECTION 6.01. Transfer Restrictions. No transfer, except
with the unanimous consent of the Members, of all or any portion of a Member's
interest in the LLC shall be permitted; provided that LUK may transfer its
interest in the LLC to any subsidiary of LUK.
Article VII
DISSOLUTION AND LIQUIDATION
SECTION 7.01. Bankruptcy. The LLC shall be dissolved and
its affairs shall be wound up upon the Bankruptcy (as defined below) of the LLC
or any Member; provided, however, that upon the occurrence of any such event, a
majority in interest of the Members may, within 90 days thereafter, agree to
continue the business of the LLC, upon all of the terms and provisions of this
Agreement. For purposes of this Agreement, "Bankruptcy" means (i) the filing of
a voluntary petition seeking liquidation, reorganization, arrangement or
readjustment, in any form, of debts under title 11 of the United States Code, as
amended (the "Bankruptcy Code") (or corresponding provisions of future laws) or
any other federal, state or foreign insolvency law, or the filing of an answer
consenting to or acquiescing in any such petition; (ii) the making of any
assignment for the benefit of creditors or the admission in writing of the
inability to pay debts as they mature; or (iii) the expiration of 60 days after
the filing of an involuntary petition under the Bankruptcy Code (or
corresponding provisions of future laws) seeking
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an application for the appointment of a receiver, or an involuntary petition
seeking liquidation, reorganization, arrangement or readjustment of debts under
any other federal, state or foreign insolvency law, unless the same shall have
been vacated, set aside or stayed within such 60-day period.
SECTION 7.02. Effect of Dissolution. Upon dissolution,
subject to the Members' right to elect to continue the business of the LLC
pursuant to Section 7.01 hereof, the LLC shall cease carrying on its business
but shall not terminate until the winding up of the affairs of the LLC is
completed, the assets of the LLC shall have been distributed as provided below
and a Certificate of Cancellation of the LLC under the LLCA has been filed with
the Secretary of State of the State of Delaware.
SECTION 7.03. Liquidation Upon Dissolution. Upon the
dissolution of the LLC, subject to the Members' right to elect to continue the
business of the LLC pursuant to Section 7.01 hereof, sole and plenary authority
to effectuate the liquidation of the assets of the LLC shall be vested (a) in
LUK for so long as LUK's Preferred Capital interest in the LLC shall remain
outstanding, and if such Preferred Capital interest shall have been
extinguished, (b) in HFC, which party shall have full power and authority to
sell, assign and encumber any and all of the LLC's assets and to wind up and
liquidate the affairs of the LLC in an orderly and business-like manner. The
proceeds of liquidation of the assets of the LLC distributable upon a
dissolution and winding up of the LLC shall be applied in the following order of
priority:
(i) first, to the creditors of the LLC, including creditors
who are Members, in the order of priority provided by law, in
satisfaction of all liabilities and obligations of the LLC (of any
nature whatsoever, including, without limitation, fixed or contingent,
matured or unmatured, legal or equitable, secured or unsecured),
whether by payment or the making of reasonable provision for payment
thereof; and
(ii) thereafter, in accordance with the provisions of
Article IV hereof.
SECTION 7.04. Winding Up and Certificate of Cancellation.
The winding up of the LLC shall be completed when all of its debts, liabilities,
and obligations have been paid and discharged or reasonably adequate provision
therefor has been made, and all of the remaining property and assets of the LLC
have been distributed to the Members. Upon the completion of the winding up of
the LLC, a Certificate of Cancellation of the LLC shall be filed with the
Secretary of State of the State of Delaware.
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Article VIII
AMENDMENT
SECTION 8.01. Amendment Procedures. This Agreement may be
amended or modified only by a written instrument executed by each Member. In
addition, the terms or conditions hereof may be waived by a written instrument
executed by the party waiving compliance.
Article IX
MISCELLANEOUS
SECTION 9.01. Counterparts. This Agreement may be executed
in two or more counterparts, each of which shall be deemed to be an original,
but all of which shall constitute one and the same agreement.
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IN WITNESS WHEREOF, the parties hereto have entered into
this Agreement as of the date first written above.
HOMEFED CORPORATION
By: /s/ Xxxxxxx X. Xxxx
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Name: Xxxxxxx X. Xxxx
Title: Secretary and Treasurer
LEUCADIA NATIONAL CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxxx
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Name: Xxxxxxx X. Xxxxxxxxx
Title: Vice President
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