Execution Copy
ANDLINGER CAPITAL XIII LLC
OPERATING AGREEMENT
OPERATING AGREEMENT dated as of December 14, 1998 among the
persons whose names appear on Schedule A hereto, as members (the "Members").
W I T N E S S E T H:
WHEREAS the Members have formed a limited liability company
(the "LLC") under the Connecticut Limited Liability Company Act (the "Act")
pursuant to the Articles of Organization (the "Articles of Organization") filed
with the Office of the Secretary of State of Connecticut (the "Secretary of
State"); and
WHEREAS the Members wish to set forth the terms pursuant to
which the LLC will be formed, managed and operated.
NOW, THEREFORE, in consideration of the mutual promises and
agreements made herein, the parties, intending to be legally bound hereby, agree
as follows:
ARTICLE I
GENERAL
1.01. Offices. The principal office of the LLC shall be at 000
Xxxxxx Xxxxx, Xxxxxxxx XX 00000. The LLC may operate at such additional offices
as it shall deem advisable.
1.02. Purpose. The LLC (i) is organized to hold equity
interests in a single entity, (ii) has all powers provided by law and (iii) may
use those powers to any lawful purpose.
1.03. Term. The LLC shall continue in full force and effect
until December 31, 2025 unless earlier terminated.
1.04. Name. The name of the LLC shall be "ANDLINGER CAPITAL
XIII LLC".
1.05. Registered Agent and Office. The registered agent for
service of process and the registered office shall be that person and location
stated in the Articles of Organization. In the event the registered agent ceases
to act as such for any reason, the Members shall promptly appoint a substitute
registered agent or file notice of a change in address, as the case may be.
1.06. Additional Members. The Members in their sole discretion
shall be entitled to admit any person as a new Member by a vote of a majority in
interest of the Members voting in accordance with their voting Units (as
described in Section 3.02 hereof).
ARTICLE II
MANAGEMENT
2.01. Management Rights. (a) Except as otherwise expressly
provided herein, all management rights of the LLC shall be vested in the
Manager. The initial Manager shall be Xxxxxxx X. Xxxxxx. The Manager shall have
complete discretion to exercise any voting rights with respect to any securities
owned by the LLC and to sell or otherwise dispose of such securities for
adequate consideration and to exercise any other rights with respect to such
securities; provided, however, that upon notice to the Manager, the Members, by
the vote of a majority in interest of the Members voting in accordance with
their voting Units, may direct the Manager as to the manner in which such voting
rights shall be exercised and whether and to what extent such securities shall
be sold or otherwise disposed of.
(b) A Manager may resign at any time by an instrument in
writing delivered to the Members, but such resignation shall not be effective
until the effective election of a successor Manager by the vote of a majority in
interest of the Members voting in accordance with their voting Units.
(c) Upon a Manager becoming domiciled in Florida, or otherwise
having a Florida tax situs for Florida intangible tax purposes, that Manager
shall be automatically removed and a successor Manager shall be elected as
provided above.
2.02. Members' Rights. Actions required or permitted to be
taken by the Members hereunder shall be taken with the consent of a majority in
interest of the Members, voting in proportion to the number of voting Units set
forth opposite such Member's name on Schedule A hereto, as the same may be
updated from time to time.
2.03. No Liability of Member or Manager; Reimbursement of
Expenses. (a) No Member and no Manager shall be liable for any obligation or
liability of the LLC.
(b) The Manager shall be reimbursed for all reasonable
expenses incurred in the management of the LLC. A Manager may also serve as
legal counsel to the LLC and shall be compensated for his or her services in
accordance with his or her schedule of fees in effect from time to time or such
other amount as may be agreed upon.
2.04. Liability and Indemnification. (a) Neither a Member nor
the Manager shall be liable, responsible or accountable, in damages or
otherwise, to any other Member or to the LLC for any act performed by the Member
or Manager with respect to LLC matters, except for fraud, gross negligence or
willful misconduct.
(b) The LLC shall indemnify each Member and the Manager for
any act performed by the Member or the Manager with respect to LLC matters,
except for fraud, gross negligence or willful misconduct. The LLC shall also
indemnify each Member and the Manager for any liability incurred by such person
in the course of serving as an officer or director of any corporation or other
entity, the securities of which are held by the LLC or in which the LLC has
invested, except for fraud, gross negligence or willful misconduct. The
provisions of this Section 2.04 shall continue to afford protection to each
person who is or was a Member or Manager regardless of whether such person
remains a Member or Manager of the LLC.
ARTICLE III
ACCOUNTING, ALLOCATIONS AND DISTRIBUTIONS
3.01. Accounting. The Manager shall maintain a "Capital
Account" for each of the Members. "Capital Account" shall mean with respect to
any Member, such Member's initial or subsequent capital contributions to the
LLC, increased by such Member's share of any income (which shall include capital
gains), reduced by such Member's share of any loss (which shall include capital
losses) of the LLC and the amount of any distributions of cash or the fair
market value of assets distributed by such LLC to such Member. The Members'
initial capital contributions shall be set forth on Schedule A hereto.
3.02. Units and Special Allocations of Profits and Losses. (a)
Upon becoming a Member of the LLC, a Member shall be credited with Units which
represent such Member's interests in the underlying assets of the LLC. Units may
be designated as Common Stock Units (representing the common stock held by the
LLC) which are voting Units, or as Warrant Units (representing the warrants held
by the LLC) which are nonvoting Units, or such other designation as the Manager
shall determine. The Manager shall keep an up to date schedule of all of the
Units allocated to each Member and the designation of such Units.
Notwithstanding the foregoing, each Member shall have and own interests in the
LLC (but not the LLC property itself).
(b) Income (which shall include capital gains) and loss (which
shall include capital losses) shall be specially allocated to the Members in
accordance with the income and loss attributable to the Units credited to each
Member.
3.03. Distributions. The LLC may distribute to the Members
cash or property; such distributions shall be to such persons, at such times and
in such amounts as may be determined by the Manager from time to time; provided,
however, that distributions to any Member shall not exceed such Member's Capital
Account and upon a dissolution of the LLC, distributions to Members shall be
governed by Article VII hereof. Such distributions may be made by the Manager
even if such distribution would cause the LLC to cease to have any assets.
ARTICLE IV
PROHIBITED CONDUCT
4.01. Transactions with the LLC. Except as expressly permitted
hereunder, no Member other than the Manager may act on behalf of the LLC for any
purpose; no Member including the Manager may use the LLC's name, credit, or
property for other than LLC purposes. If a Member enters into a transaction
involving the LLC that is not within the scope of its authority, and such
transaction results in any loss to the LLC, the loss shall be borne solely by
that Member.
4.02. Prohibited Acts. Without the prior approval of the
Members, by the vote of a majority in interest of the Members voting in
accordance with their voting Units, the Manager may not:
(a) Do any act in contravention of this Agreement;
(b) Borrow any funds or lend any money in the name or on
behalf of the LLC;
(c) Pledge, mortgage, hypothecate, or encumber any assets of
the LLC or any interest in the LLC;
(d) Make, execute or deliver any assignment of LLC assets,
including any assignment of assets for the benefit of creditors;
(e) Execute any bond, guaranty, or confession of judgment
relating to any part of the LLC's assets or any interest therein; or
(f) Enter onto any agreement, contract or commitment of the
LLC not in the ordinary course of business of managing the LLC or which requires
payments by the LLC in excess of $ 50,000 over the term of such agreement,
contract or commitment.
ARTICLE V
BOOKS, RECORDS, ACCOUNTING AND REPORTS
5.01. Books and Records. The LLC's books and records, together
with all of the documents and papers pertaining to the business of the LLC,
shall be kept at the principal office of the LLC or at 000 Xxxxx Xxxxxxxx,
Xxxxxxxxx, Xxx Xxxx 00000xxx at all reasonable times shall be open to the
inspection of and may be copied and excerpts taken therefrom by any Member or
such Member's duly authorized representative, provided that such inspection is
made in good faith and without any intent to damage the LLC or any of the
Members.
5.02. Accounting Year. The fiscal and tax year of the LLC
shall be a calendar year.
5.03. Tax Returns. The Manager shall cause income tax returns
for the LLC to be prepared and timely filed with the appropriate authorities.
Each Member of the LLC shall cooperate with and assist in the preparation of
such tax returns.
5.04. Bank Accounts. All funds of the LLC shall be deposited
in the name of the LLC in such bank account or accounts as shall be deemed
appropriate by the Manager. All withdrawals therefrom shall be made upon checks
signed on behalf of the Manager by any person or persons approved by the Manager
to sign such checks.
ARTICLE VI
TRANSFERABILITY OF A MEMBER'S INTEREST
6.01. Restrictions on Transfers of Interest. No sale,
exchange, transfer or assignment of a Member's interest in the LLC may be made
(other than by operation of law) without the consent of the Members by the vote
of a majority in interest of the Members voting in accordance with their voting
Units. Any attempted transfer of a Member's interest in the LLC in contravention
of this Section 6.01 shall be void.
ARTICLE VII
DISSOLUTION
7.01. Dissolution of LLC. The LLC will dissolve upon the
earlier of December 31, 2025 or the written consent of the majority in interest
of the Members voting in accordance with their voting Units. In settling
accounts after dissolution, the assets of the LLC shall be paid out in the
following order:
(1) first, to creditors other than Members (whether by payment
or establishment of reserves), in the order or priority as provided by law;
(2) second, to the Members for liabilities other than with
respect to Capital Accounts; and
(3) third, to the Members in proportion to the balances in
their Capital Accounts.
No Member shall be obligated to contribute to the LLC any amount with respect to
the negative amount, if any, of such Member's Capital Account.
ARTICLE VIII
AMENDMENTS
8.01. Adoption of Amendments. The vote of the majority in
interest of the Members voting in accordance with their voting Units shall be
required to amend this Agreement or to grant waivers from any provision of this
Agreement or to take any other action permitted to be taken by Members under the
Act.
ARTICLE IX
MISCELLANEOUS PROVISIONS
9.01. Intent of the Members. It is the express intention of
the Members that this Agreement and the Articles of Organization shall be the
sole sources of agreement of the parties and, except to the extent (a)
provisions of the Code or regulations of the Department of the Treasury under
the Code, as lawfully changed from time to time, are incorporated herein by
reference, or (b) any provision of this Agreement is expressly prohibited or
ineffective under the Act, this Agreement shall govern, even if inconsistent
with, or different than, the provisions of the Act or any other law or rule. To
the extent any provision of this Agreement is prohibited or ineffective under
the Act, it shall be considered amended to the extent necessary to be effective
under the Act.
9.02. Number and 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 the masculine, feminine and
neuter gender shall include the masculine, feminine and neuter.
9.03. Headings and Cross-References. The various headings in
this Agreement are included for convenience only and shall not affect the
meaning and interpretation of any provision of this Agreement. References in
this Agreement to Section names or numbers are to such Sections of this
Agreement unless otherwise specified.
9.04. Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of Connecticut,
without reference to its conflict of laws provisions and the obligations,
rights, and remedies of the parties hereunder shall be determined in accordance
with such laws.
9.05. Notices. All notices under this Agreement shall be in
writing, personally delivered or mailed by certified mail, return receipt
requested.
9.06. Counterparts. This Agreement may be executed in two or
more counterparts and by different parties on separate counterparts, each of
which shall be an original, but all of which together shall constitute one and
the same instrument.
IN WITNESS WHEREOF the undersigned have executed and delivered
this Operating Agreement as of the date first above written.
/s/ Xxxxxxx X. Xxxxxxxxx
------------------------
Xxxxxxx X. Xxxxxxxxx, as Member
/s/ Xxxxxxx X. Xxxxxx
---------------------
Xxxxxxx X. Xxxxxx, as Member and
as Manager
/s/ Xxxxxxx X. Xxxx
-------------------
Xxxxxxx X. Xxxx, as Member
/s/ Xxxx X. Xxxxx
-----------------
Xxxx X. Xxxxx, as Member
Andlinger Capital XIII LLC
Schedule A
Initial Capital
Name Contribution Common Stock Units Warrant Units
-------------- ---------------- ------------------ -------------
Xxxxxxx X. Xxxxxxxxx $5,550,000 1,850,000 1,850,000
Xxxxxxx X. Xxxx 300,000 100,000 100,000
Xxxxxxx X. Xxxxxx 75,000 25,000 25,000
Xxxx X. Xxxxx 75,000 25,000 25,000
