Contract
Exhibit 10.26
Mercury Parent, LLC
SECOND AMENDED AND RESTATED LIMITED LIABILITY COMPANY
AGREEMENT
Dated as of February 16, 2018
THE UNITS REFERRED TO IN THIS AMENDED AND RESTATED LIMITED
LIABILITY COMPANY AGREEMENT HAVE NOT BEEN REGISTERED UNDER
THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR UNDER
ANY OTHER APPLICABLE SECURITIES LAWS. SUCH UNITS MAY NOT BE
SOLD, ASSIGNED, PLEDGED OR OTHERWISE DISPOSED OF AT ANY TIME
WITHOUT EFFECTIVE REGISTRATION UNDER SUCH ACT AND LAWS OR
EXEMPTION THEREFROM, AND COMPLIANCE WITH THE OTHER
SUBSTANTIAL RESTRICTIONS ON TRANSFERABILITY SET FORTH HEREIN.
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TABLE OF CONTENTS
Page
ARTICLE I
CERTAIN DEFINITIONS
ARTICLE II
ORGANIZATIONAL MATTERS
2.1. Formation ................................................................................................................. 20
2.2. The Certificate, Etc .................................................................................................. 21
2.3. Name.......................................................................................................................... 21
2.4. Purpose...................................................................................................................... 21
2.5. Powers of the LLC ................................................................................................... 21
2.6. Foreign Qualification ............................................................................................... 22
2.7. Principal Office; Registered Office ........................................................................ 23
2.8. Term .......................................................................................................................... 23
2.9. No State-Law Partnership ....................................................................................... 23
ARTICLE III
UNITS; CAPITAL ACCOUNTS
3.1. Units; Unitholders .................................................................................................... 24
3.2. Unitholder Meetings ................................................................................................ 28
3.3. Action of Unitholders by Written Consent or Telephone Conference ................ 31
3.4. Issuance of Additional Units and Interests ............................................................ 32
3.5. Preemptive Rights .................................................................................................... 33
3.6. Capital Accounts ...................................................................................................... 35
3.7. Negative Capital Accounts ...................................................................................... 36
3.8. No Withdrawal ......................................................................................................... 36
3.9. Loans From Unitholders ......................................................................................... 36
3.10. Additional Terms Applicable to Value Units ...................................................... 36
3.11. Effects of a Trigger Event ..................................................................................... 36
3.12. Effects of an Excess Escrow Loss ......................................................................... 36
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ARTICLE IV
DISTRIBUTIONS; ALLOCATIONS AND REDEMPTIONS
4.1. Distributions ............................................................................................................. 41
4.2. Allocations ................................................................................................................ 44
4.3. Tax Allocations ......................................................................................................... 44
4.4. Indemnification and Reimbursement for Payments on Behalf of a
Unitholder ............................................................................................................ 45
4.5. Transfer of Capital Accounts .................................................................................. 45
4.6. Withholding .............................................................................................................. 45
ARTICLE V
BOARD OF MANAGERS; OFFICERS
5.1. Management by the Board of Managers ............................................................... 47
5.2. Composition and Election of the Board of Managers .......................................... 52
5.3. Board Meetings and Actions by Written Consent ................................................ 55
5.4. Committees; Delegation of Authority and Duties ................................................. 58
5.5. Officers ...................................................................................................................... 59
ARTICLE VI
GENERAL RIGHTS AND OBLIGATIONS OF UNITHOLDERS
6.1. Limitation of Liability ............................................................................................. 60
6.2. Lack of Authority ..................................................................................................... 60
6.3. No Right of Partition ............................................................................................... 60
6.4. Unitholders Right to Act ......................................................................................... 61
6.5. Right to Financial Information ............................................................................... 61
6.6. Public Filing Information Rights ............................................................................ 62
6.7. Non-Competition ...................................................................................................... 65
6.8. Non-Solicitation ........................................................................................................ 65
6.9. Statements by the Unitholder ................................................................................. 65
6.10. Publicity .................................................................................................................. 66
6.11. Transactions Between the LLC and the Unitholders ......................................... 67
6.12. Initial Public Offering............................................................................................ 67
6.13. Interests in Providence .......................................................................................... 67
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ARTICLE VII
EXCULPATION AND INDEMNIFICATION
7.1. Exculpation ............................................................................................................... 68
7.2. Right to Indemnification ......................................................................................... 68
7.3. Advance Payment..................................................................................................... 69
7.4. Indemnification of Employees and Agents ............................................................ 69
7.5. Appearance as a Witness ......................................................................................... 69
7.6. Nonexclusivity of Rights .......................................................................................... 69
7.7. Insurance .................................................................................................................. 70
7.8. Savings Clause .......................................................................................................... 70
7.9. Certain Dealings and Opportunities ...................................................................... 70
ARTICLE VIII
BOOKS, RECORDS, ACCOUNTING AND REPORTS
8.1. Records and Accounting.......................................................................................... 71
8.2. Fiscal Year ................................................................................................................ 71
8.3. Tax Information ....................................................................................................... 71
8.4. Transmission of Communications .......................................................................... 71
8.5. LLC Funds ................................................................................................................ 71
ARTICLE IX
TAXES
9.1. Tax Returns .............................................................................................................. 71
9.2. Tax Elections ............................................................................................................ 72
9.3. Tax Matters Partner ................................................................................................ 72
ARTICLE X
TRANSFERS
10.1. Transfers by Unitholders ...................................................................................... 73
10.2. Effect of Assignment .............................................................................................. 74
10.3. Restrictions on Transfer ........................................................................................ 75
10.4. Participation Rights ............................................................................................... 75
10.5. First Negotiation Rights ........................................................................................ 78
10.6. Drag-Along Rights ................................................................................................. 79
10.7. Transfer of Consent and Designation Rights ...................................................... 81
10.8. Void Transfers ........................................................................................................ 82
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10.9. Legends ................................................................................................................... 82
ARTICLE XI
ADMISSION OF UNITHOLDERS
11.1. Substituted Unitholders ......................................................................................... 82
11.2. Additional Unitholders .......................................................................................... 83
11.3. Optionholders ......................................................................................................... 83
ARTICLE XII
WITHDRAWAL AND RESIGNATION OF UNITHOLDERS
12.1. Withdrawal and Resignation of Unitholders ....................................................... 83
12.2. Withdrawal of a Unitholder .................................................................................. 83
ARTICLE XIII
DISSOLUTION AND LIQUIDATION
13.1. Dissolution .............................................................................................................. 84
13.2. Liquidation and Termination ............................................................................... 84
13.3. Cancellation of Certificate .................................................................................... 85
13.4. Reasonable Time for Winding Up ........................................................................ 85
13.5. Return of Capital ................................................................................................... 85
13.6. Reserves Against Distributions ............................................................................. 85
ARTICLE XIV
VALUATION
14.1. Determination ......................................................................................................... 86
14.2. Fair Market Value ................................................................................................. 86
ARTICLE XV
GENERAL PROVISIONS
15.1. Power of Attorney .................................................................................................. 88
15.2. Confidentiality ........................................................................................................ 88
15.3. Amendments ........................................................................................................... 90
15.4. Title to LLC Assets ................................................................................................ 91
15.5. Remedies ................................................................................................................. 91
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15.6. Successors and Assigns .......................................................................................... 91
15.7. Severability ............................................................................................................. 91
15.8. Regulatory Matters ................................................................................................ 91
15.9. Notice to Unitholder of Provisions........................................................................ 92
15.10. Counterparts ........................................................................................................ 92
15.11. Consent to Jurisdiction ........................................................................................ 92
15.12. Descriptive Headings; Interpretation ................................................................ 92
15.13. Applicable Law..................................................................................................... 93
15.14. MUTUAL WAIVER OF JURY TRIAL ............................................................ 93
15.15. Addresses and Notices ......................................................................................... 94
15.16. Creditors ............................................................................................................... 94
15.17. Waiver ................................................................................................................... 94
15.18. Further Action ...................................................................................................... 94
15.19. Offset ..................................................................................................................... 94
15.20. Entire Agreement ................................................................................................. 95
15.21. Delivery by Facsimile ........................................................................................... 95
15.22. Survival ................................................................................................................. 95
15.23. Deemed Transfer of Units ................................................................................... 95
15.24. Recapitalization .................................................................................................... 95
15.25. Acknowledgement ................................................................................................ 95
SCHEDULE A Unitholders, Capital Contributions and Units
SCHEDULE B Management Equity and Employee Incentive Plan Units
EXHIBIT A Key Terms of Registration Rights Agreement
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Mercury Parent, LLC
SECOND AMENDED AND RESTATED LIMITED LIABILITY COMPANY
AGREEMENT
This SECOND AMENDED AND RESTATED LIMITED LIABILITY
COMPANY AGREEMENT, dated as of February 16, 2018, is entered into by and among
Mercury Parent, LLC (the βLLCβ) and the Unitholders party hereto.
WHEREAS, the LLC and certain of the Unitholders are party to that certain
Amended and Restated Limited Liability Company Agreement dated October 19, 2016
(the βExisting LLC Agreementβ); and
WHEREAS, the Unitholders wish to enter into this Second Amended and Restated
Limited Liability Company Agreement to amend and restate the Existing LLC Agreement
in its entirety and admit certain new Unitholders and wish for this Agreement to constitute
the limited liability company agreement of the LLC in accordance with the Delaware Act,
and to provide for, among other things, the management of the business and affairs of the
LLC, the allocation of profits and losses among the Unitholders, the respective rights and
obligations of the Unitholders to each other and to the LLC, and certain other matters.
NOW, THEREFORE, in consideration of the mutual covenants contained herein
and other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending to be legally bound, hereby enter into this
Agreement as follows:
ARTICLE I
CERTAIN DEFINITIONS
Capitalized terms used but not otherwise defined herein shall have the following
meanings:
βAbsent Managerβ shall have the meaning set forth in Section 5.3(b).
βAccredited Investorβ has the meaning given to such term in Regulation D
promulgated under the Securities Act.
βAdditional Securitiesβ shall have the meaning set forth in Section 3.4.
βAdditional Unitholderβ means a Person admitted to the LLC as a Unitholder
pursuant to Section 11.2.
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βAdvisory Agreementβ means that certain Management Consulting Agreement,
dated as of the Effective Date, by and among the Borrower, Xxxxxxx Management, LLC and
The Providence Service Corporation.
βAffiliateβ of any particular Person means (i) any other Person controlling,
controlled by, or under common control with such particular Person, where βcontrolβ
means the possession, directly or indirectly, of the power to direct the management and
policies of a Person whether through the ownership of voting securities, by contract, or
otherwise, (ii) if such Person is a partnership, any general partner thereof or any limited
partner thereof who, alone or together with its Affiliates, owns at least 50% of the
outstanding limited partnership interests of such partnership and (iii) without limiting the
foregoing, with respect to Xxxxxxx only, any Person advised, managed or sub-advised by an
investment adviser affiliated with such Persons; provided, that for purposes of this
Agreement (x) none of the members of the Company Group shall be deemed an Affiliate
of Xxxxxxx or Providence (and vice versa) and (y) Coliseum shall not be considered an
Affiliate of Providence; provided, that Coliseum shall be deemed an Affiliate of Providence
for purposes of Section 10.6 and the definitions of βSale of the LLCβ and βApproved Saleβ
for so long as Coliseum owns, directly or indirectly, at least five percent (5%) of the debt
or equity Securities of Providence Parent and/or Providence.
βAgreementβ means this Second Amended and Restated Limited Liability
Company Agreement, as amended or modified from time to time in accordance with the
terms hereof.
βAnnual Financial Statementsβ shall have the meaning set forth in Section 6.6(a)(i).
βApproved Saleβ means:
(a) any Sale of the LLC approved by each Principal Investor;
(b) prior to the seventh (7th) anniversary of the Effective Date, any Sale of the LLC
approved by Xxxxxxx at such time that Xxxxxxx (together with its Affiliates) holds no less
than fifty percent (50%) of the LLCβs outstanding Units (without giving effect to any
dilution resulting from issuances that are not subject to the preemptive rights set forth in
Section 3.5) (i) that occurs prior to an initial Public Offering, (ii) that would result (with
respect to each Principal Investor) in Proceeds to the Principal Investors of not less than
one times (1.0x) the Principal Investor Investment as of the date thereof if all Units
outstanding were Transferred in such Sale of the LLC, (iii) pursuant to which all of the
consideration received is cash or marketable securities (unless the Principal Investors
otherwise agree) and (iv) pursuant to which Xxxxxxx proposes to Transfer to any Person or
Group that is not an Affiliate of Xxxxxxx all of its Units in a single Sale of the LLC; and
(c) after the seventh (7th) anniversary of the Effective Date, any Sale of the LLC
approved by either Principal Investor at such time that such Principal Investor (together
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with its Affiliates) holds no less than thirty percent (30%) of the LLCβs outstanding Units
(without giving effect to any dilution resulting from issuances that are not subject to the
preemptive rights set forth in Section 3.5) (i) that occurs prior to an initial Public Offering,
(ii) pursuant to which all of the consideration received is cash or marketable securities
(unless the Principal Investors otherwise agree) and (iii) pursuant to which such Principal
Investor proposes to Transfer to any Person or Group that is not an Affiliate of such
Principal Investor all of its Units in a single Sale of the LLC.
For the avoidance of doubt, (A) the approval of the Board shall not be required to
consummate, commit to or enter into any agreement to effectuate an Approved Sale, and
(B) to the maximum extent permitted by applicable law, no Manager will owe, or be
deemed to have breached, any fiduciary duty with respect to any action or inaction in
connection with effectuating any such Approved Sale.
βAssigneeβ means a Person to whom an LLC Interest has been transferred in
accordance with the terms of this Agreement and the other agreements contemplated
hereby, but who has not become a Unitholder pursuant to Article XI.
βBenchmark Amountβ shall have the meaning set forth in Section 3.10(a)(iv).
βBoardβ means the Board of Managers established pursuant to Section 5.2.
βBoard Observerβ shall have the meaning set forth in Section 5.3(i).
βBorrowerβ means Community Care Health Network, LLC.
βBusiness Dayβ shall mean any day that is not a Saturday, a Sunday or a day on
which banks are required or permitted to be closed in the State of New York.
βBuyerβ shall have the meaning set forth in the DPN Purchase Agreement.
βCapital Accountβ shall have the meaning set forth in Section 3.6(a).
βCapital Contributionsβ means any cash, cash equivalents, promissory obligations,
or the Fair Market Value of other property that a Unitholder contributes or is deemed to
have contributed to the LLC with respect to any Unit pursuant to Sections 3.1 or 3.4.
βCauseβ means, with respect to any Other Unitholder (i) if such term is defined in
an employment or Service agreement with such Other Unitholder, the definition used in
such agreement, (ii) if such term is defined in an award agreement or other document
pursuant to which equity-based awards are granted to such Other Unitholder, the definition
used in such agreement and (iii) in all other circumstances, a termination of an Other
Unitholderβs employment by the LLC or any Subsidiary of the LLC that employs such
individual (or by the LLC on behalf of any such Subsidiary), or a termination of such Other
Unitholderβs Service, as applicable, by reason of one or more of the following having
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occurred (as reasonably determined by the Board (excluding such Other Unitholder, if he
is then a member of the Board) based on information then known to it):
(a) such Other Unitholder having been charged by a court of competent
jurisdiction with felony or a lesser crime involving dishonesty or moral
turpitude (under the laws of the United States or any relevant state, or a
similar crime or offense under the applicable laws of any relevant foreign
jurisdiction);
(b) such Other Unitholder having engaged in acts of fraud, embezzlement,
theft, misappropriation, dishonesty or other acts of willful misconduct,
malfeasance or gross negligence in the course of his duties hereunder or
otherwise with respect to the LLC or any of its Subsidiaries;
(c) such Other Unitholder having failed to perform or uphold his or her material
duties under this Agreement and/or such Other Unitholderβs employment or
Service agreement (if any) with the LLC or any of its Subsidiaries after
being informed of and given the opportunity and at least thirty (30) days to
remedy such failure to comply;
(d) if such Other Unitholder is a Management Unitholder, such Management
Unitholder having failed to materially comply with reasonable directives of
the Board or any senior executive officer of the LLC or any Subsidiary of
the LLC who holds a supervisory capacity over the Management Unitholder
after being informed of and given the opportunity to remedy such failure to
comply;
(e) any breach by such Other Unitholder of any provision of Sections 6.7, 6.8,
6.9 or 15.2 of this Agreement, or any material breach by such Other
Unitholder of any other contract to which he or she is a party with the LLC
or any Subsidiary of the LLC (excluding the DPN Purchase Agreement (but
including Sections 7.07 (Confidentiality) and 7.08 (Releases) thereof)) after
being informed of and given the opportunity and at least thirty (30) days to
remedy such breach;
(f) if such Other Unitholder is a Management Unitholder, such Management
Unitholder having violated the substance abuse policy of the LLC or any of
its Subsidiaries;
(g) if such Other Unitholder is a Management Unitholder, such Management
Unitholderβs willful and material failure to adhere to any policy applicable
generally to all executive employees of the LLC or any of its Subsidiaries
after being informed of and given the opportunity and at least thirty (30)
days to remedy such failure;
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(h) such Other Unitholder having appropriated a material business opportunity
of the LLC or any of its Subsidiaries, including attempting to secure or
securing any personal profit in connection with any transaction entered into
with or on behalf of the LLC or any of its Subsidiaries but excluding any
bona-fide armβs length transaction approved by the Board; or
(i) if such Other Unitholder is a Management Unitholder, such Management
Unitholder having been debarred or excluded from any federal or state
contracting or healthcare program.
βCEO Board Seatβ shall have the meaning set forth in Section 5.2.(a)(vii).
βCertificateβ means the LLCβs Certificate of Formation as filed with the Secretary
of State of Delaware.
βChairpersonβ shall have the meaning set forth in Section 5.3.(g).
βChange of Controlβ shall have the meaning set forth in the definition of
βTransferβ.
βClass A Common Holderβ means a Unitholder in regard to such Unitholderβs
particular LLC Interest in Class A Common Units.
βClass A Common Unitsβ means a sub-class of Common Units, as described in
Section 3.1(b).
βClass B Common Holderβ means a Unitholder in regard to such Unitholderβs
particular LLC Interest in Class B Common Units.
βClass B Common Unitsβ means a sub-class of Common Units, as described in
Section 3.1(b).
βClosing Equityβ means the number of Units held by a Unitholder as of the date of
its initial Capital Contribution, provided that for purposes of any calculation comparing a
Unitholderβs ownership of equity in the LLC with such Unitholderβs Closing Equity, the
effect of (i) any recapitalization or exchange or conversion of securities of the LLC, (ii)
any redemption or repurchase of securities of the LLC or (iii) any subdivision (by Unit split
or otherwise) or any combination (by reverse Unit split or otherwise) of any outstanding
Units, in each case which occurs between the date of its initial Capital Contribution and
the date of such calculation and which is pro rata in effect, shall be disregarded.
βCodeβ means the United States Internal Revenue Code of 1986, as amended.
βColiseumβ means Coliseum Capital Management LLC and its related funds.
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βCommon Holderβ means a Unitholder in regard to such Unitholderβs particular
LLC Interest in Common Units.
βCommon Unitsβ means a class of LLC Interests, as described in Section 3.1(b).
For the avoidance of doubt, Common Units shall (i) include Class A Common Units and
Class B Common Units, and (ii) exclude Value Units.
βCompany Groupβ means, collectively, the LLC and each of its direct or indirect
Subsidiaries.
βCompany Subβ means CCHN Group Holdings, Inc.
βCompeting Businessβ shall have the meaning set forth in Section 6.7.
βCompetitorβ means Person that competes with the Business. For purposes of this
definition only, the term βBusinessβ shall mean the business of contracting with health
plans to provide health assessments for health evaluation and/or plan risk adjustment
purposes and care management or care coordination for Commercial, Managed Medicaid
and Medicare Advantage members.
βConfidential Informationβ shall have the meaning set forth in Section 15.2.
βConsultation Rightsβ shall have the meaning set forth in Section 6.10.
βCredit Agreementβ means (i) the Existing Credit Agreement and (ii) any
agreement (including any credit agreement, loan agreement, indenture or other financing
agreement) extending the maturity of, consolidating, restructuring, refunding, replacing or
refinancing all or any portion of the obligations under the Existing Credit Agreement,
whether by the same or any other lender, debt holder or group of lenders or debt holders or
the same or any other agent, trustee or representative therefor and whether or not increasing
or decreasing the amount of any Indebtedness (as defined in the Existing Credit
Agreement) that may be incurred thereunder.
βDeficiencyβ shall have the meaning set forth in Section 6.6(a)(v).
βDelaware Actβ means the Delaware Limited Liability Company Act, 6 Del. L.
Β§ 18-101, et seq., as it may be amended from time to time, and any successor to the
Delaware Act.
βDistributionβ means each distribution made by the LLC to a Unitholder with
respect to such Personβs Units, whether in cash, property or securities of the LLC or
otherwise and whether by liquidating distribution, redemption, repurchase, or otherwise;
provided that any pro rata recapitalization or exchange or conversion of securities of the
LLC, or any redemption or repurchase of securities of the LLC, in each case, pursuant to
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this Agreement and any subdivision (by Unit split or otherwise) or any combination (by
reverse Unit split or otherwise) of any outstanding Units shall not be deemed a Distribution.
βDPNβ means DPN USA, LLC (d/b/a βHealthFairβ), a Florida limited liability
company.
βDPN Purchase Agreementβ means the Securities Purchase Agreement, dated
January 4, 2018, by and among Buyer, DPN, the Sellers, and the Sellersβ Representative,
as may be amended, supplemented or modified from time to time.
βDraft Tax Formsβ shall have the meaning set forth in Section 9.1.
βEconomic Capital Accountβ means, with respect to any Unitholder, such
Unitholderβs Capital Account balance as of the date of determination, after crediting to
such Capital Account any amounts that the Unitholder is deemed obligated to restore under
Treasury Regulations Section 1.704-2.
βEffective Dateβ means October 19, 2016.
βEkbataniβ means Xxxxxxxx βXxxxxβ Xxxxxxxx.
βXxxxxxxx Holderβ means (i) Ekbatani, as long as he holds Units, and (ii) any
Affiliate or Permitted Transferee of Ekbatani that hereafter becomes an Additional
Unitholder pursuant to Section 11.2.
βEkbatani Repurchase Optionβ shall have the meaning set forth in Section 3.11(a).
βEkbatani Repurchase Priceβ shall have the meaning set forth in Section 3.11(a).
βEquity Securitiesβ means (i) Units or other equity interests in the LLC or a legal
successor thereto (including other classes or groups thereof having such relative rights,
powers, and duties as may from time to time be established by the Board, including rights,
powers, and/or duties senior to existing classes and groups of Units and other equity
interests in the LLC), (ii) obligations, evidences of indebtedness, or other securities or
interests convertible or exchangeable into Units or other equity interests in the LLC or a
legal successor thereto, and (iii) warrants, options, or other rights to purchase or otherwise
acquire Units or other equity interests in the LLC or a legal successor thereto.
βEvent of Withdrawalβ means the death, retirement, resignation, expulsion,
bankruptcy or dissolution of a Unitholder or the occurrence of any other event that
terminates the continued membership of a Unitholder in the LLC.
βExcess Escrow Lossβ shall have the meaning set forth in the DPN Purchase
Agreement.
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βExcessive Leverage Eventβ means, the incurrence or guarantee of any Restricted
Debt by the LLC or any of its Subsidiaries, unless, after giving pro forma effect to such
incurrence or guarantee and the use of proceeds thereof, the Total Net Leverage Ratio (as
defined in the Existing Credit Agreement as in effect on the Effective Date, unless such
changes are otherwise approved by the Principal Investors for purposes of this definition,
and to be calculated in manner consistent with such version of the Existing Credit
Agreement and as if all references to the Borrower and its Subsidiaries (as defined in such
version of the Existing Credit Agreement) in such version of the Existing Credit Agreement
were references to the LLC and its Subsidiaries on a consolidated basis) of the LLC would
be less than or equal to 5.50:1.00 as of the last day of the most recently ended fiscal quarter
for which the LLCβs financial statements are available.
βExisting LLC Agreementβ shall have the meaning set forth in the Recitals.
βExisting Credit Agreementβ means, that Credit Agreement, dated as of February
16, 2018, among the Borrower, the banks and other financial institutions party thereto,
SunTrust Bank, as Administrative Agent, CCHN Holdings, LLC and the Subsidiaries of
the Borrower party thereto, as in effect on the Effective Date.
βFair Market Valueβ means, with respect to any asset or equity interest, its fair
market value determined according to Article XIV.
βFamily Groupβ means a Unitholderβs parents, spouse and lineal descendants
(whether natural or adopted), and any trust, limited partnership, limited liability company
or other entity wholly owned and controlled, directly or indirectly, by such Unitholder or
such Unitholderβs parents, spouse and/or lineal descendants (whether natural or adopted)
that is and remains solely for the benefit of such Unitholder and/or such Unitholderβs
parents, spouse and/or lineal descendants (whether natural or adopted).
βFATCAβ shall mean (a) Sections 1471 through 1474 of the Code, the Treasury
Regulations thereunder, and official interpretations thereof; (b) any legislation, regulations
or guidance enacted in any jurisdiction that seeks to implement a similar tax reporting or
withholding tax regime; (c) any intergovernmental agreement, treaty or other agreement
between any jurisdictions (including any government bodies in such jurisdiction) entered
into in order to comply with, facilitate, supplement or implement any legislation,
regulations or guidance described in clause (a) or (b) above; and (d) any legislation,
regulations or guidance that gives effect to any matter described in clauses (a) through (c)
above.
βFiling Scheduleβ shall have the meaning set forth in Section 6.6(b).
βFiscal Quarterβ means each calendar quarter ending March 31, June 30, September
30, and December 31.
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βFiscal Yearβ shall have the meaning set forth in Section 8.2.
βXxxxxxxβ means (i) Mercury Fortuna Buyer, LLC and (ii) any of its Affiliates or
Permitted Transferees that become an Additional Unitholder pursuant to Section 11.2.
Unless otherwise agreed by the holder(s) of a majority of the Units collectively held by
Xxxxxxx, any action taken or contemplated to be taken by Xxxxxxx pursuant to this Agreement
shall be taken by the holder(s) of a majority of the Units collectively held by Xxxxxxx at
such time.
βXxxxxxx Managersβ shall have the meaning set forth in Section 5.2.(a).
βGAAPβ shall have the meaning set forth in Section 5.1(b)(iv)(C).
βGovernmental Entityβ means the United States of America or any other nation,
any state or other political subdivision thereof, or any entity exercising executive,
legislative, judicial, regulatory or administrative functions of government or any agency or
department or subdivision of any governmental authority, including the United States
federal government or any state or local government.
βGrant Dateβ means, with respect to any Value Units, the date on which such Value
Units are granted to the applicable Management Unitholder or Operating Unitholder, in
each case as set forth opposite such Unitholderβs name on the row corresponding to such
grant on Schedule A hereto.
βGroupβ shall have the meaning set forth in Sections 13(d)(3) and 14(d)(2) of the
Securities Exchange Act of 1934, as amended.
βImputed Underpayment Amountβ shall have the meaning set forth in Section
4.6(f).
βInactive Unitholderβ shall have the meaning set forth in Section 3.10(b)(ii).
βIndependent Auditorβ shall have the meaning set forth in Section 14.3.
βInformationβ shall have the meaning set forth in Section 6.6.
βInformation Recipientβ means (i) the Principal Investors and (ii) each Unitholder
holding ten percent (10%) or more of any class of Units outstanding.
βInitial Valueβ means, as of any date of determination, an amount equal to the
aggregate Capital Contributions made by the Common Holders to the LLC on or prior to
such date of determination in respect of the Common Units held by such Common Holders.
βInvestor Groupβ shall have the meaning set forth in Section 7.9.
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βIssuance Noticeβ shall have the meaning set forth in Section 3.5(b).
βLiensβ means any mortgage, pledge, security interest, encumbrance, lien, or
charge of any kind (including any conditional sale or other title retention agreement or
lease in the nature thereof), any sale of receivables with recourse against the applicable
Person, or any Subsidiary or any Affiliate thereof, any filing or agreement to file a
financing statement as debtor under the Uniform Commercial Code or any similar statute
other than to reflect ownership by a third party of property leased to the applicable Person,
any Subsidiary or any Affiliate under an operating lease which is not in the nature of a
conditional sale or title retention agreement.
βLLCβ has the meaning set forth in the Preamble.
βLLC Interestβ means the limited liability interest in the LLC which represents the
interest of each Unitholder in and to the Profits and Losses of the LLC, and such
Unitholderβs right to receive Distributions of the LLCβs assets, as set forth in this
Agreement.
βLossesβ means items of LLC loss and deduction determined in accordance with
U.S. tax principles as applied to the maintenance of capital accounts.
βManagement Unitholderβ means any Unitholder that is employed by the LLC or
any of its Subsidiaries, and is designated as such on Schedule A hereto.
βManagerβ means a manager on the Board, who, for purposes of the Delaware Act,
will be deemed a βmanagerβ (as defined in the Delaware Act) but will be subject to the
rights, obligations, limitations and duties set forth in this Agreement. A βmemberβ of the
Board shall be a Manager for purposes of this Agreement.
βMaterial Changeβ shall have the meaning set forth in Section 6.6(a)(vi).
βMember Nonrecourse Debtβ has the same meaning as βpartner nonrecourse debtβ
as set forth in Treasury Regulations Section 1.704-2(b)(4).
βMember Nonrecourse Debt Minimum Gainβ has the same meaning as βpartner
nonrecourse debt minimum gainβ as set forth in Treasury Regulations Section 1.704-
2(i)(2).
βMonthly Financial Informationβ shall have the meaning set forth in Section
6.6(a)(iii).
βNegotiation Noticeβ shall have the meaning set forth in Section 10.5.
βNegotiation Partiesβ shall have the meaning set forth in Section 10.5.
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βOfficersβ means each person designated as an officer of the LLC to whom
authority and duties have been delegated pursuant to Section 5.5, subject to any resolution
of the Board appointing such person as an officer or relating to such appointment.
βOperating Unitholderβ means a Unitholder that provides Services to the LLC or
its Subsidiaries, and is designated as such on Schedule A hereto.
βOther Accredited Unitholdersβ shall have the meaning set forth in Section 3.5(a).
βOther Unitholdersβ means, collectively, the Management Unitholders and the
Operating Unitholders.
βParticipating Purchaserβ shall have the meaning set forth in Section 3.5(b).
βPartnership Minimum Gainβ shall have the meaning set forth in Sections 1.704-
2(b)(2) and 1.704-2(d) of the Treasury Regulations.
βPermitted Transfereeβ means (i) with respect to any Unitholder who is a natural
person, a member of such Unitholderβs Family Group, (ii) with respect to any Unitholder
which is an entity, any entity which is a Subsidiary of such Unitholder or any Person of
which such Unitholder is a Subsidiary and (iii) with respect to any current or former
Principal Investor, such current or former Principal Investorβs Affiliates (in each case, it
being understood that any Transfer to such Persons shall be conditioned on the receipt of
an undertaking by such Transferee to Transfer such Units back to the Transferor if such
Transferee ceases to otherwise qualify as a Permitted Transferee); provided that portfolio
companies of Xxxxxxxβx investment manager or any other financial sponsor whose funds
become a Unitholder shall not be Permitted Transferees of such Unitholder. For the
avoidance of doubt, none of the members of the Company Group shall be deemed a
Permitted Transferee of Xxxxxxx or Providence.
βPersonβ means an individual, a partnership, a corporation, a limited liability
company, an association, a joint stock company, a trust, a joint venture, an unincorporated
organization, any other business entity, or a Governmental Entity.
βPlanβ mean the Mercury Parent, LLC 2016 Value Unit Plan (as amended and in
effect from time to time).
βPreemptive Portionβ shall have the meaning set forth in Section 3.5(a).
βPreemptive Pro Rata Percentageβ means, at any time, the percentage obtained by
dividing the total number of Units then held by the applicable holder by the aggregate
number of Units then held by all of the Unitholders who are Accredited Investors.
βPreemptive Securitiesβ shall have the meaning set forth in Section 3.5(a).
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βPrincipal Investorβ means (a) Xxxxxxx and/or (b) Providence; provided, that (i) each
of Xxxxxxx and Providence shall cease to be deemed a βPrincipal Investorβ if it ceases to
hold at least twenty percent (20%) of its Closing Equity and (ii) Providence shall cease to
be deemed a βPrincipal Investorβ upon the consummation of a Change of Control of The
Providence Service Corporation or its successor to a Competitor. Any action requiring the
consent or approval of the Principal Investors collectively pursuant to this Agreement shall
require the approval of each of Xxxxxxx and Providence (unless and until either or both has
ceased to be a Principal Investor pursuant to the preceding sentence).
βPrincipal Investor Investmentβ means, without duplication, as of any measurement
date, the aggregate payments or investment (including the contribution of shares of the
Company Sub by Providence and Xxxxxxx, valued in accordance with the Subscription
Agreement at the time of their contribution) by each of the Principal Investors with respect
to or in exchange for Units (including securities that are convertible into Units) of the LLC
(whether such payments are made to the LLC or any third party) from the Effective Date
until such measurement date (including any Capital Contributions).
βPrincipal Investor Managersβ shall have the meaning set forth in Section 5.3(b).
βPrincipal Investor Ratioβ means, with respect to any Principal Investor, at the time
of determination, the ratio obtained by dividing the number of Units owned by such
Principal Investor by the aggregate number of outstanding Units owned by all Principal
Investors at the time such determination.
βProceedingβ shall have the meaning set forth in Section 7.2.
βProceeds to the Principal Investorsβ means the aggregate cash return to each of the
Principal Investors in respect of their Units, taking into account the amount of all previous
cash dividends and cash distributions to the Principal Investors in respect of such Units and
all cash proceeds to the Principal Investors from the sale or other disposition of such Units.
βProfitsβ means items of LLC income and gain determined in accordance with U.S.
tax principles as applied to the maintenance of capital accounts.
βProvidenceβ means, (i) Prometheus Holdco, LLC and (ii) any of its Affiliates or
Permitted Transferees or any Affiliates or Permitted Transferees of The Providence Service
Corporation that hereafter becomes an Additional Unitholder pursuant to Section 11.2.
Unless otherwise agreed by the holder(s) of a majority of the Units collectively held by
Providence, any action taken or contemplated to be taken by Providence pursuant to this
Agreement shall be taken by the holder(s) of a majority of the Units collectively held by
Providence at such time.
βProvidence Parentβ means The Providence Service Corporation or any successor
entity thereof, whether by recapitalization, reorganization or otherwise, and any Subsidiary
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thereof that may from time to time be subject to reporting or filing obligations under the
Securities Act or the Securities Exchange Act or offer or sell securities exempt from
registration under the Securities Act.
βProvidence Managersβ shall have the meaning set forth in Section 5.2(a).
βPublic Offeringβ means any sale of the common equity securities of the LLC or
another member of the Company Group (or a successor thereto) pursuant to an effective
registration statement under the Securities Act filed with the Securities and Exchange
Commission; provided that the following shall not be considered a Public Offering: (i) any
issuance of common equity securities as consideration for a merger, consolidation,
amalgamation or acquisition of an entity or a division of an entity or all or substantially all
of the assets thereof, and (ii) any issuance of common equity securities or options or rights
to acquire (or the exercise thereof) common equity securities to employees, directors,
officers or consultants of the LLC or its Subsidiaries as part of an incentive or
compensation plan or arrangement, in each case, that has been approved pursuant to
Section 5.1(b)(iv).
βQualified IPOβ means an underwritten IPO with aggregate gross cash proceeds
(without regard to any underwriting discount or commission) of at least $200 million
(whether to the LLC (or a successor entity), its equity holders, or both).
βQuarterly Financial Statementsβ shall have the meaning set forth in Section
6.6(a)(ii).
βXxx Xxxxxxxx Trustβ means the Nobility Trust.
βRegistration Rights Agreementβ shall have the meaning set forth in Section 6.12.
βRelative Ownership Percentageβ means (a) with respect to the Units held by a
Unitholder, a fraction (expressed as a percentage) (i) the numerator of which is the number
of Units owned by such Unitholder immediately following the effective time of a Transfer
and (ii) the denominator of which is the aggregate number of Units owned by such
Unitholder at the time of the initial Public Offering and (b) with respect to the Units held
by the Principal Investors, a fraction (expressed as a percentage) (i) the numerator of which
is the aggregate number of Units owned by all of the Principal Investors immediately
following the effective time of such Transfer and (ii) the denominator of which is the
aggregate number of Units owned by all of the Principal Investors at the time of the initial
Public Offering.
βReportβ means any: (i) registration statement, prospectus or private placement
memorandum for use in connection with any registration, offering or sale of Providence
Parent securities under the Securities Act (including Form X-0, Xxxx X-0, Form S-4 and
Form S-8), or with any offering or sale of Providence Parent securities exempt from
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registration under the Securities Act (in each case, at Providenceβs sole cost and expense);
(ii) report of Providence Parent (including any related exhibits) filed or furnished with the
Securities and Exchange Commission pursuant to the Securities Exchange Act, including
Form 10-Q, Form 10-K, Form 8-K and Schedule 14A; (iii) listing application or report of
Providence Parent required by any securities exchange and (iv) annual report, proxy
statement, press release, investor presentation or other communication required to be
transmitted to Providence Parent shareholders or reasonably determined to be necessary.
βRequired Interestβ means a majority of the Units.
βRequisite Board Meeting Noticeβ shall have the meaning set forth in Section
5.3(f).
βRestricted Debtβ means any Indebtedness (as defined in the Existing Credit
Agreement as in effect on the Effective Date but excluding from the calculation thereof
any Disqualified Capital Stock as defined therein, unless such changes are otherwise
approved for purposes of this definition by the Principal Investors) of the LLC or its
Subsidiaries, but excluding any (i) revolving credit indebtedness and letter of credit
obligations incurred under any credit agreement in an aggregate principal and/or face
amount not to exceed $20 million outstanding at any one time and (ii) intercompany
indebtedness.
βRestricted Periodβ shall have the meaning set forth in Section 6.7.
βRestrictive Covenant Agreementsβ means the Restrictive Covenant Agreements,
dated January 4, 2018, by and among DPN, Borrower, and each of Ekbatani, Xxx Xxxxxxxx,
Xxxxx Xxxxxxxx and Xxxxx Xxxx, as applicable.
βRollover Call Optionβ shall have the meaning set forth in Section 3.12(a).
βRollover Holdersβ means (i) any Unitholder holding Class B Common Units, and
designated as such on Schedule A hereto, and (ii) any Affiliate or Permitted Transferee of
any Person specified in clause (i) that hereafter becomes an Additional Unitholder pursuant
to Section 11.2. For the avoidance of doubt, in the event that any Rollover Holder that is
also a Seller under the DPN Purchase Agreement Transfers any Units to any Person in
accordance with the terms of this Agreement (including as Permitted Transfer), such
Transferee of the Units shall be deemed a Rollover Holder and Seller for purposes of
Section 3.12, and shall hold such Units subject to the obligations under Section 3.12 as if
such Transferee were the initial Transferring Rollover Holder.
βRule 144β means Rule 144 promulgated under the Securities Act, or any successor
rule.
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βSale of the LLCβ means any transaction or series of transactions pursuant to which
any Person or group of related Persons (other than the Principal Investors and their
respective Affiliates) in the aggregate acquire(s), directly or indirectly, (i) Equity Securities
possessing the voting power (other than voting rights accruing only in the event of a default
or breach) to elect a majority of the LLCβs Board (whether by merger, consolidation,
reorganization, combination, sale or transfer of the Equity Securities, securityholder or
voting agreement, proxy, power of attorney or otherwise) or (ii) all or substantially all of
the Company Groupβs assets determined on a consolidated basis.
βSecuritiesβ means notes, stocks, limited liability company equity interests, bonds,
debentures, evidences of indebtedness, certificates of interest or participation in any profit-
sharing agreement, partnership interests, beneficial interests in trusts, collateral-trust
certificates, pre-organization certificates or subscriptions, transferable shares, investment
contracts, voting-trust certificates, certificates of deposit for securities, equity interests,
notional principal contracts and certificates of interest or participation in, temporary or
interim certificates for, receipts for or warrants or rights or options to subscribe to or
purchase or sell any of the foregoing, and any other items commonly referred to as
securities.
βSecurities Actβ means the Securities Act of 1933, as amended, and applicable rules
and regulations thereunder, and any successor to such statute, rules, or regulations. Any
reference herein to a specific section, rule, or regulation of the Securities Act shall be
deemed to include any corresponding provisions of future law.
βSecurities Exchange Actβ means the Securities Exchange Act of 1934, as
amended, and applicable rules and regulations thereunder, and any successor to such
statute, rules, or regulations. Any reference herein to a specific section, rule, or regulation
of the Securities Exchange Act shall be deemed to include any corresponding provisions
of future law.
βSellerβ shall have the meaning set forth in the DPN Purchase Agreement.
βSellersβ Representativeβ shall have the meaning set forth in the DPN Purchase
Agreement.
βServiceβ means, with respect to any Operating Unitholder, service to the LLC or
any of its Subsidiaries (including service as a consultant, director or officer of such Person),
in each case to the extent such Operating Unitholder was appointed to such position directly
or indirectly by the Board.
βXxxxx Xxxxxxxx Trustβ means the Dignity Trust.
βSubject Holdersβ means, collectively, the Principal Investors and the Rollover
Holders.
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βSubscription Agreementβ means that certain Subscription Agreement, dated as of
August 28, 2016, by and between Mercury Fortuna Buyer, LLC, the Company Sub and
The Providence Service Corporation.
βSubsidiaryβ means, with respect to any Person, any corporation, limited liability
company, partnership, association, or 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 limited
liability company, partnership, association, or other business entity (other than a
corporation), a majority of partnership or other similar ownership interest thereof is at the
time owned or controlled, directly or indirectly, by that Person or one or more Subsidiaries
of that Person or a combination thereof; provided, that none of the members of the
Company Group shall be deemed a Subsidiary of Xxxxxxx or Providence for purposes of
this Agreement. For purposes hereof, a Person or Persons shall be deemed to have a
majority ownership interest in a limited liability company, partnership, association, or other
business entity (other than a corporation) if such Person or Persons shall be allocated a
majority of limited liability company, partnership, association, or other business entity
gains or losses or shall be or control any managing director or general partner of such
limited liability company, partnership, association, or other business entity. For purposes
hereof, references to a βSubsidiaryβ of any Person shall be given effect only at such times
that such Person has one or more Subsidiaries, and, unless otherwise indicated herein, the
term βSubsidiaryβ refers to a Subsidiary of the LLC.
βSubstituted Unitholderβ means a Person that is admitted as a Unitholder to the
LLC pursuant to Section 11.1.
βTag-Along Escrow Amountβ shall have the meaning set forth in Section 10.4(f).
βTag-Along Escrow Noticeβ shall have the meaning set forth in Section 10.4(f).
βTag-Along Noticeβ shall have the meaning set forth in Section 10.4(a).
βTag-Along Offerβ shall have the meaning set forth in Section 10.4(a).
βTag-Along Pro Rata Percentageβ means, with respect to any Unitholder, at the
time a Tag-Along Notice is delivered by the Tag-Along Seller in accordance with Section
10.4.(a), the percentage obtained by dividing the number of Units owned by such
Unitholder by the aggregate number of outstanding Units owned by all Unitholders at the
time such Tag-Along Notice is delivered.
βTag-Along Response Noticeβ shall have the meaning set forth in Section 10.4(a).
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βTag-Along Sellerβ shall have the meaning set forth in Section 10.4(a).
βTag-Along Unitholdersβ shall have the meaning set forth in Section 10.4(a).
βTarget Balanceβ means, with respect to any Unitholder as of the close of any Fiscal
Year (or other relevant period) for which allocations are made under Article IV, the amount
such Unitholder would receive (or be required to contribute) in a hypothetical liquidation
of the LLC as of the close of such period, assuming for purposes of any hypothetical
liquidation (i) a sale of all of the assets of the LLC at prices equal to their then book values
(as maintained by the LLC for purposes of, and as maintained pursuant to, the capital
account maintenance provisions of Treasury Regulations Section 1.704-1(b)(2)(iv)) and
(ii) the distribution of the net proceeds thereof to the Unitholders pursuant to the provisions
of Article IV (after the payment of all actual LLC indebtedness, and any other liabilities
related to the LLCβs assets, limited, in the case of non-recourse liabilities, to the collateral
securing or otherwise available to satisfy such liabilities).
βTaxβ or βTaxesβ means any federal, state, local, or foreign income, gross receipts,
franchise, estimated, alternative minimum, add-on minimum, sales, use, transfer,
registration, value added, excise, natural resources, severance, stamp, occupation,
premium, windfall profit, environmental, customs, duties, real property, personal property,
capital stock, social security, unemployment, disability, payroll, license, employee, or
other withholding, or other tax, of any kind whatsoever, including any interest, penalties,
or additions to tax or additional amounts in respect of the foregoing.
βTax Matters Partnerβ shall have the meaning set forth in Section 9.3.
βTransferβ means any direct or indirect sale, transfer, assignment, pledge,
mortgage, exchange, hypothecation, grant of a security interest in or other disposition or
encumbrance of, including any swap, participation or other arrangement that transfers to
another Person, in whole or in part, any economic consequences of ownership of, a Unit or
other interest in the LLC (whether voluntary, involuntary, by operation of law or
otherwise); provided, that (i) any Transfer of Securities of The Providence Service
Corporation or its successor (including any parent entity resulting from such Transfer)
(whether by consolidation, merger, reorganization or otherwise) or (ii) a Change of Control
of The Providence Service Corporation or its successor, in each case, shall not be deemed
a βTransferβ of any Units or other interest in the LLC held thereby. As used herein, the
term βChange of Controlβ means, with respect to any Person, (i) any liquidation,
dissolution or winding up of such Person, whether voluntary or involuntary, other than a
liquidation, dissolution or winding up for purposes of effecting a corporate restructuring or
reorganization as a result of which the holders of such Personβs outstanding equity interests
possessing the voting power (under ordinary circumstances) to elect a majority of such
Personβs board of directors (or similar governing body) immediately prior to such
liquidation, dissolution or winding up (or their Affiliates) beneficially own, directly or
indirectly, the outstanding equity securities of the surviving entity possessing the voting
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power (under ordinary circumstances) to elect a majority of the surviving entityβs board of
directors (or similar governing body), (ii) any sale, transfer, assignment or other disposition
by such Person of all or substantially all of its assets (other than to an Affiliate), (iii) any
consolidation, merger or reorganization of such Person with or into any other entity or
entities as a result of which the holders of such Personβs outstanding equity interests
possessing the voting power (under ordinary circumstances) to elect a majority of such
Personβs board of directors (or similar governing body) immediately prior to such
consolidation, merger or reorganization (or their Affiliates) no longer beneficially own,
directly or indirectly, the outstanding equity securities of the surviving entity possessing
the voting power (under ordinary circumstances) to elect a majority of the surviving
entityβs board of directors (or similar governing body) or (iv) any sale, transfer, assignment
or other disposition to any third party of such Personβs equity securities by the holders
thereof as a result of which the holders of such Personβs equity securities possessing the
voting power (under ordinary circumstances) to elect a majority of such Personβs board of
directors (or similar governing body) immediately prior to such sale, transfer, assignment
or other disposition (or their Affiliates) no longer beneficially own, directly or indirectly,
the outstanding equity securities of such Person possessing the voting power (under
ordinary circumstances) to elect a majority of such Personβs board of directors (or similar
governing body). The terms βTransferee,β βTransferred,β and other forms of the word
βTransferβ shall have correlative meanings.
βTransferorβs Ownerβ shall have the meaning set forth in Section 10.1(e).
βTransferring Unitholderβ shall have the meaning set forth in Section 10.5.
βTreasury Regulationsβ means the income tax regulations promulgated under the
Code.
βTrigger Eventβ means the occurrence of one or more of the following events:
(a) Ekbatani has, at any time, prior to his reinstatement to Medicare effective
April 1, 2013, been determined by a court or Governmental Entity to have violated
the terms of his exclusion from Medicare;
(b) Other than in connection with United States x. Xxxxx, No. :99-cr-14015
(S.D. Fl. ) (the βCampo Matterβ), Ekbatani has (i) pled guilty or nolo contendere
to, or been convicted of, a misdemeanor or felony described in 42 U.S.C. Β§1320a-
7; or (ii) been determined by a court or Governmental Entity to have otherwise
engaged in conduct that is grounds for mandatory exclusion or permissive
exclusion, in each case, described in 42 U.S.C. Β§1320a-7;
(c) Other than in connection with the Campo Matter, Ekbatani has, to the
detriment (whether economic or otherwise) of the LLC or any of its Subsidiaries
(or, by virtue of Ekbataniβs ownership in the LLC, the LLC or any of its
Β
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Subsidiaries has), pled guilty or nolo contendere to, or been convicted of, a
misdemeanor or felony involving fraud, embezzlement, theft or misappropriation;
or
(d) Ekbatani to the detriment (whether economic or otherwise) of the LLC or
any of its Subsidiaries (or, by virtue of Ekbataniβs ownership in the LLC, the LLC
or any of its Subsidiaries):
(i) becomes suspended, debarred or otherwise disqualified or
ineligible to participate in any federal health care program
(as defined in 42 U.S.C. Β§1320a-7b(f)) or any state
healthcare program or is determined by a court or
Governmental Entity to be ineligible to provide management
or administrative services to a healthcare provider; or
(ii) becomes subject to sanction or indictment (with respect to
any criminal investigation), in each case, related to health
care by any federal, state, or local enforcement, regulatory,
administrative or licensing agency, or is named in a
complaint by a Governmental Entity under the False Claims
Act.
βUnitβ means an LLC Interest of a Unitholder or an Assignee in the LLC
representing a fractional part of the LLC Interests of all Unitholders and Assignees. With
respect to any Unit, to βholdβ such Unit means to own such Unit and a βholderβ thereof
means an owner of such Unit. For the avoidance of doubt, βUnitsβ shall include Common
Units and Value Units.
βUnit Transfer Agreementβ shall have the meaning set forth in Section 15.23.
βUnitholderβ means any owner of one or more Units as reflected on the LLCβs
books and records, and any Person admitted to the LLC as an Additional Unitholder or
Substituted Unitholder; but only for so long as such Person is shown on the LLCβs books
and records as the owner of one or more Units.
βUnpaid Equity Value Amountβ means, as of any given date of determination with
respect to all Unitholders (other than Class B Holders), an amount of distributions, in the
aggregate, equal to $531,309,972.27, less an amount equal to the cumulative distributions
made by the LLC in respect of all Units (other than Class B Common Units) as of such
date pursuant to Section 4.1, provided that, for purposes of this definition, notwithstanding
anything to the contrary contained in this Agreement, the Unpaid Equity Value Amount
may never be less than Zero Dollars ($0).
βUSRPHCβ shall have the meaning set forth in Section 2.10(b).
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βValue A Holderβ means a Unitholder in regard to such Unitholderβs particular
LLC Interest in Value A Units.
βValue B Holderβ means a Unitholder in regard to such Unitholderβs particular
LLC Interest in Value B Units.
βValue C Holderβ means a Unitholder in regard to such Unitholderβs particular
LLC Interest in Value C Units.
βValue D Holderβ means a Unitholder in regard to such Unitholderβs particular
LLC Interest in Value D Units.
βValue B Thresholdβ shall have the meaning set forth in the Plan.
βValue C Thresholdβ shall have the meaning set forth in the Plan.
βValue D Thresholdβ shall have the meaning set forth in the Plan.
βValue A Unitsβ means a sub-class of Value Units, as described in Section 3.1(c).
βValue B Unitsβ means a sub-class of Value Units, as described in Section 3.1(c).
βValue C Unitsβ means a sub-class of Value Units, as described in Section 3.1(c).
βValue D Unitsβ means a sub-class of Value Units, as described in Section 3.1(c).
βValue Unitholderβ means a Unitholder in regard to such Unitholderβs particular
LLC Interest in Value Units.
βValue Unitsβ means the Value A Units, Value B Units, Value C Units and Value
D Units.
βWithheld Amountβ shall have the meaning set forth in Section 4.6(b).
βWithholding Paymentβ shall have the meaning set forth in Section 4.6(a).
ARTICLE II
ORGANIZATIONAL MATTERS
2.1. Formation. The LLC has been organized as a Delaware limited liability
company by the filing with the Secretary of State of the State of Delaware of the Certificate
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under and pursuant to the Delaware Act and shall be continued in accordance with this
Agreement.
2.2. The Certificate, Etc. The Certificate was filed with the Secretary of State
of the State of Delaware on October 17, 2016. The Unitholders hereby agree to execute,
file and record all such other certificates and documents, including amendments to the
Certificate, and to do such other acts as may be appropriate to comply with all requirements
for the formation, continuation and operation of a limited liability company, the ownership
of property, and the conduct of business under the laws of the State of Delaware and any
other jurisdiction in which the LLC may own property or conduct business, in each case,
as reasonably requested by the Board.
2.3. Name. The name of the LLC shall be βMercury Parent, LLCβ. The Board
in its sole discretion may change the name of the LLC at any time and from time to time.
Notification of any such change shall be given to all Unitholders. The LLCβs business may
be conducted under its name and/or any other name or names deemed advisable by the
Board.
2.4. Purpose. The sole purpose of the LLC is, and the nature of the business to
be conducted and promoted by the LLC shall be, (a) to directly or indirectly invest in, own
and dispose of securities of its Subsidiaries and any assets ancillary to such investment,
ownership and disposal and (b) to engage in all lawful acts or activities necessary, advisable
or incidental and in furtherance of the foregoing, subject to the terms of this Agreement.
2.5. Powers of the LLC. Subject to the provisions of this Agreement
(including, for the avoidance of doubt, Section 5.1(b)(iv)) and the agreements
contemplated hereby, the LLC shall have the power and authority to take any and all actions
necessary, appropriate, proper, advisable, convenient or incidental to or for the furtherance
of the purposes set forth in Section 2.4, including the power:
(a) to carry on its operations and have and exercise the powers granted
to a limited liability company by the Delaware Act in any state, territory, district or
possession of the United States, or in any foreign country that may be necessary,
convenient or incidental to the accomplishment of the purpose of the LLC;
(b) to acquire by purchase, lease, contribution of property or otherwise,
own, hold, operate, maintain, finance, refinance, improve, lease, sell, convey, mortgage,
transfer, demolish or dispose of any real or personal property that may be necessary,
convenient or incidental to the accomplishment of the purpose of the LLC;
(c) to enter into, perform and carry out contracts of any kind, including
contracts with any Unitholder or any Affiliate thereof, or any agent of the LLC necessary
to, in connection with, convenient to or incidental to the accomplishment of the purpose of
the LLC;
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(d) to purchase, take, receive, subscribe for or otherwise acquire, own,
hold, vote, use, employ, sell, mortgage, lend, pledge, or otherwise dispose of, and otherwise
use and deal in and with, shares or other interests in or obligations of domestic or foreign
corporations, associations, general or limited partnerships (including the power to be
admitted as a partner thereof and to exercise the rights and perform the duties created
thereby), trusts, limited liability companies (including the power to be admitted as an
equityholder or appointed as a manager thereof and to exercise the rights and perform the
duties created thereby) or individuals or direct or indirect obligations of the United States
or of any government, state, territory, governmental district or municipality or of any
instrumentality of any of them;
(e) to lend money for any proper purpose, to invest and reinvest its
funds and to take and hold real and personal property for the payment of funds so loaned
or invested;
(f) to xxx and be sued, complain and defend, and participate in
administrative or other proceedings in its name;
(g) to indemnify any Person in accordance with the Delaware Act and
to obtain any and all types of insurance;
(h) to cease its activities and cancel its Certificate;
(i) to negotiate, enter into, renegotiate, extend, renew, terminate,
modify, amend, waive, execute, acknowledge or take any other action with respect to any
lease, contract or security agreement in respect of any assets of the LLC;
(j) to borrow money and issue evidences of indebtedness and guarantee
indebtedness (whether of the LLC or any of its Subsidiaries), and to secure the same by a
Lien on the assets of the LLC or its Subsidiaries or a pledge of the stock of any Subsidiary
of the LLC;
(k) to pay, collect, compromise, litigate, arbitrate or otherwise adjust or
settle any and all other claims or demands of or against the LLC or to hold such proceeds
against the payment of contingent liabilities; and
(l) to make, execute, acknowledge and file any and all documents or
instruments necessary, convenient or incidental to the accomplishment of the purpose of
the LLC.
2.6. Foreign Qualification. Prior to the LLCβs conducting activities in any
jurisdiction other than Delaware, the Board shall cause the LLC to comply, to the extent
procedures are available and those matters are reasonably within the control of the Board,
with all requirements necessary to qualify the LLC as a foreign limited liability company
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in that jurisdiction. At the reasonable request of the Board or any Officer, each Unitholder
shall execute, acknowledge, swear to and deliver all certificates and other instruments
conforming with this Agreement that are necessary or appropriate to qualify, continue and
terminate the LLC as a foreign limited liability company in all such jurisdictions in which
the LLC may conduct business.
2.7. Principal Office; Registered Office. The principal office of the LLC shall
be located at Two Union Square, 000 Xxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, XX 00000 or at
such other place as the Board may from time to time designate. All activities of the LLC
shall be deemed to have occurred at its principal office. The LLC may maintain offices at
such other place or places as the Board deems advisable. The registered office of the LLC
required by the Delaware Act to be maintained in the State of Delaware shall be the office
of the initial registered agent named in the Certificate or such other office (which need not
be a place of business of the LLC) as the Board may designate from time to time in the
manner provided by law. The registered agent of the LLC in the State of Delaware shall
be the initial registered agent named in the Certificate or such other Person or Persons as
the Board may designate from time to time in the manner provided by law.
2.8. Term. The term of the LLC commenced upon the filing of the Certificate
in accordance with the Delaware Act and shall continue in existence until termination and
dissolution thereof in accordance with the provisions of Article XIII.
2.9. No State-Law Partnership. Except as provided in the next sentence, the
Unitholders intend that the LLC not be a partnership (including a limited partnership) or
joint venture, and that no Unitholder be a partner or joint venturer of any other Unitholder
by virtue of this Agreement, and neither this Agreement nor any other document entered
into by the LLC or any Unitholder relating to the subject matter hereof shall be construed
to suggest otherwise. The Unitholders intend that the LLC shall be treated as a partnership
for federal and, if applicable, state or local income tax purposes, and that each Unitholder
and the LLC shall file all tax returns and shall otherwise take all tax and financial reporting
positions in a manner consistent with such treatment. Without the consent of the Principal
Investors, the LLC shall not make an election to be treated as a corporation for federal
income tax purposes pursuant to Treasury Regulation 301.7701-3 (or any successor
regulation or provision) and, if applicable, state and local income tax purposes.
2.10. No UBTI/ECI.
(a) The LLC shall use best efforts to operate and cause its Subsidiaries
to operate in a manner that will not cause any Unitholder (or any direct or indirect equity
owner thereof), subject to Section 511 of the Code, to recognize unrelated business taxable
income under Section 512 of the Code or unrelated debt-financed income under Section
514 of the Code. The LLC shall not invest in or own any other entity that is tax-transparent
for U.S. federal income tax purposes unless such entity is subject to similar restrictions
regarding unrelated business taxable income.
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(b) The LLC shall use best efforts to conduct its affairs so that its direct
foreign Unitholders (or any direct or indirect foreign equity owner of any Unitholder) will
not be treated as engaged in a trade or business, and will not recognize income which is, or
is treated as, effectively connected with the conduct of a U.S. trade or business for purposes
of Sections 864, 881,882, 884, 897 or 1446 of the Code solely as a result of the LLCβs
activities or investments. The LLC shall also use its reasonable best efforts to conduct its
affairs so that any of its direct foreign Unitholders (or any direct or indirect foreign equity
owner of any Unitholder) that is entitled to the benefits of Section 892 of the Code will not
be treated as engaged in a βcommercial activityβ within the meaning of Code Section 892
solely as a result of the LLCβs activities or investments. In furtherance thereof, the LLC
will use reasonable best efforts not to: (i) acquire or own an interest or option to acquire an
equity interest in any partnership, limited liability company, trust or other entity which is
not treated as a corporation for United States tax purposes, other than an interest solely as
a creditor, unless (A) the LLC determines, after consultation with counsel to the LLC, that
such proposed acquisition (and in the case of an acquisition of an option to acquire an
equity interest, the acquisition of such equity interest upon exercise of the option) is not
likely to cause its direct foreign Unitholder (or any direct or indirect foreign equity owner
of any Unitholder) to be treated as engaged in a U.S. trade or business within the meaning
of the Code Sections specified in the preceding sentence and (B) such entity agrees to be
bound contractually by restrictions substantially similar to those set forth in this paragraph
or (ii) engage in or hold itself out as engaging in the performance of services for
compensation or otherwise carry on a United States trade or business within the meaning
of the Code Sections specified in the preceding sentence. Notwithstanding anything to the
contrary herein, if the LLC acquires an interest in a corporation that is not a βUnited States
real property holding corporationβ (as defined in Section 897(c)(2) of the Code, a
βUSRPHCβ) at the time of the LLCβs investment and that is not reasonably expected to
become a USRPHC, the LLC shall not be deemed to have breached its covenant hereunder
solely because that domestic corporation subsequently becomes a USRPHC and the LLC
continues to hold an interest in such corporation. The LLC confirms that, as of the date of
this Agreement, the LLC does not own, directly or indirectly, an interest in, and is not
reasonably expected to acquire, directly or indirectly, an interest in, a USRPHC.
(c) Notwithstanding anything to the contrary in this Section 2.10, if at
least 50% of the Managers on the Board were designated by Xxxxxxx during any period
when any action prohibited under this Section 2.10 took place, neither the LLC nor any
subsidiary thereof shall have any liability under this Section 2.10.
ARTICLE III
UNITS; CAPITAL ACCOUNTS
3.1. Units; Unitholders.
(a)
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(i) General. The LLC, as of the date hereof, has two (2)
authorized classes of Units: (i) βCommon Unitsβ (which Common Units, as described
below, will consist of Class A Common Units and Class B Common Units) and (ii) βValue
Unitsβ (which Value Units, as described below, will consist of Value A Units, Value B
Units, Value C Units and Value D Units). Common Units and Value Units are referred to
herein collectively, as the βUnitsβ. Unless and until the Board shall determine otherwise,
the Units shall each be uncertificated and recorded in the books and records of the LLC
(including Schedule A). The LLC may, in its sole discretion, issue certificates to the
Unitholders representing the Units held by each Unitholder. To the extent that the holder
of a Unit is required by the other provisions of this Agreement to deliver or surrender such
holderβs certificates representing Units, then, in the event that the Units are not certificated
by the LLC, the LLC will provide appropriate forms or documents (regarding the
conveyance of such Units, and all right, title and interest thereto) to be completed and
delivered by such holder in lieu thereof. The Board may determine the conditions upon
which a new certificate may be issued in place of a certificate that is alleged to have been
lost, stolen or destroyed and may, in its discretion, require the owner of such certificate or
its legal representative to give an agreement of indemnity or a bond, with sufficient surety,
to indemnify the LLC and each transfer agent and registrar agent, if any, against any and
all losses and claims that may arise as a result of the issuance of a new certificate in place
of the one so lost, stolen or destroyed.
(ii) Ownership Limitation. Each Rollover Holder agrees and
acknowledges that the LLC does not intend for it to own five percent (5%) or more of the
LLCβs outstanding Units. In furtherance of the foregoing, each Rollover Holder hereby
agrees and acknowledges that, unless otherwise determined by the Board, in the event that
any offering of Units (including any offering effected pursuant to Section 3.5) would result
in any such Rollover Holder owning five percent (5%) or more of the LLCβs outstanding
Units, in such case, such Rollover Holder shall refrain from participating in any such
offering of Units to the extent as may be necessary to ensure that such Rollover Holder
does not own five percent (5%) or more of the LLCβs outstanding Units following the
consummation of any such offering of Units. Also in furtherance of the foregoing, each
Rollover Holder hereby agrees and acknowledges that, unless otherwise determined by the
Board, in the event that any transaction by the LLC (e.g., a sale of Units by a Unitholder
to the LLC in accordance with the terms herein) would result in any such Rollover Holder
owning five percent (5%) or more of the LLCβs outstanding Units, in such case, such
Rollover Holder shall permit the LLC to repurchase Units from such Rollover Holder to
the extent as may be necessary to ensure that such Rollover Holder does not own five
percent (5%) or more of the LLCβs outstanding Units following the consummation of any
such transaction; any such repurchase of Units by the LLC shall be consummated at Fair
Market Value and in accordance with the terms provided in Sections 3.11 and 14.3, mutatis
mutandis.
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(b) Common Units. The LLC will have two (2) sub classes of Common
Units: Class A Common Units and Class B Common Units. The Class A Common Units
and Class B Common Units shall be identical in all respects, except as otherwise expressly
set forth in this Agreement (including Section 4.1 below). Unless otherwise determined
by the Board, the Common Units will initially be issued for a Capital Contribution of $1.00
per Common Unit. The payment terms and schedule for the Capital Contributions
applicable to the issuance of any Common Unit will be determined by the Board upon
issuance of such Common Units.
(c) Value Units.
(i) General. The LLC will have four (4) sub classes of Value
Units: Value A Units, Value B Units, Value C Units and Value D Units. Subject to the
provisions of Section 3.10 hereof (including the applicable Benchmark Amounts), the
holders of Value Units shall have the rights with respect to profits and losses of the LLC
and distributions from the LLC as set forth herein (including Section 3.10 and Article IV)
and in the Plan, provided that additional terms and conditions applicable to a Value Unit
may be established by the Board in connection with the issuance of any such Value Unit
to a Person who becomes a Management Unitholder or Operating Unitholder at any time
after the date of this Agreement in accordance with Article XI hereof. The number of Value
Units issued to any Management Unitholder or Operating Unitholder as of any given time
shall be set forth on Schedule A, as it may be updated from time to time in accordance with
this Agreement. Authorized and unallocated Value Units (if any) are set forth on
Schedule A. Notwithstanding anything to the contrary, Value Units shall not have voting
rights.
(ii) Price. The holders of Value Units are not required to make
any Capital Contribution to the LLC in exchange for their Value Units or otherwise.
(iii) Vesting. Subject to the terms and conditions of this
Agreement, including, without limitation, Section 3.10(b), the Plan, and except as
otherwise provided for in any award or other agreement evidencing a grant of Value Units,
twenty-five percent (25%) of each class of the Value Units granted to any Management
Unitholder or Operating Unitholder as of any Grant Date shall vest on the first anniversary
of such Grant Date, with the remaining portion of each class of such Value Units vesting
thereafter in thirty-six (36) substantially equal monthly installments such that one-hundred
percent (100%) of each class of the Value Units granted as of any such Grant Date shall
become fully vested on the fourth anniversary of such Grant Date. For the avoidance of
doubt, the foregoing vesting schedule requires the continued employment (in the case of
each Management Unitholder) or Service (in the case of each Operating Unitholder)
through each applicable vesting date as a condition to the vesting of the applicable
installment of the Value Units granted to such Management Unitholder or Operating
Unitholder, as the case may be. Except as otherwise approved by the Board, employment
or Service for only a portion of the vesting period, even if a substantial portion, will not
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entitle any Management Unitholder or Operating Unitholder, as the case may be, to any
proportionate vesting. Each holder of Value Units shall make an election under Section
83(b) of the Code with respect to his or her initial receipt of Value Units within 30 days of
the issuance of such Value Units and promptly provide a copy of such election to the LLC.
(d) Unitholders. Each Person named on Schedule A attached hereto
agrees that it will make (or has made) Capital Contributions to the LLC as set forth on
Schedule A in exchange for the Units specified thereon, and each Personβs initial Capital
Account established pursuant to such Capital Contributions, and the number of Units
owned by such Person, is set forth on Schedule A. Any reference in this Agreement to
Schedule A shall be deemed to be a reference to Schedule A as amended in accordance
with the terms herein and in effect from time to time. The LLC and each such Person shall
file all tax returns, including any schedules thereto, in a manner consistent with such initial
Capital Accounts. Each Unitholder listed on Schedule A upon (i) his, her or its execution
of this Agreement or a counterpart hereto and (ii) receipt (or deemed receipt) by the LLC
of such Personβs Capital Contribution as set forth on Schedule A, is hereby admitted to the
LLC as a Unitholder of the LLC. Each Unitholderβs interest in the LLC, including such
Unitholderβs interest in Profits, Losses and Distributions of the LLC and the right to vote
on certain matters as provided in this Agreement, shall be represented by the Units owned
by such Unitholder. The ownership of Units shall entitle each Unitholder to allocations of
Profits and Losses and other items and distributions of cash and other property as set forth
in Article IV or Article XIII hereof.
(e) Representations and Warranties of Unitholders. Each Unitholder
hereby represents and warrants, severally and not jointly, to the LLC and acknowledges
that: (i) such Unitholder has reviewed and evaluated all information necessary to assess the
merits and risks of his, her or its investment in the LLC and has had answered to such
Unitholderβs satisfaction any and all questions regarding such information; (ii) such
Unitholder is able to bear the economic and financial risk of an investment in the LLC for
an indefinite period of time and could afford a complete loss of such investment; (iii) such
Unitholder is acquiring interests in the LLC for investment only and not with a view to, or
for resale in connection with, any distribution to the public or public offering thereof; (iv)
to the extent that the Units are deemed to be securities under the Securities Act of 1933,
the interests in the LLC have not been registered under the securities laws of any
jurisdiction and cannot be disposed of unless they are subsequently registered and/or
qualified under applicable securities laws or pursuant to an exemption therefrom or as
otherwise provided in this Agreement have been complied with; (v) if such Unitholder is a
natural person, such Unitholder has the natural capacity (or, if such Unitholder is an entity,
such Unitholder has the corporate (or similar) power and authority) to execute and deliver
this Agreement and each document referred to herein to be executed by such Unitholder
(or counterparts thereof or joinders thereto) hereunder, and to perform its obligations
hereunder and thereunder; (vi) the execution, delivery and performance of this Agreement
have been duly authorized by such Unitholder and do not require such Unitholder to obtain
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any consent or approval that has not been obtained and do not contravene or result in a
default under any provision of any law or regulation applicable to such Unitholder or other
governing documents or any agreement or instrument to which such Unitholder is a party
or by which such Unitholder is bound; (vii) the determination of such Unitholder to
purchase or otherwise acquire interests in the LLC has been made by such Unitholder
independent of any other Unitholder and independent of any statements or opinions as to
the advisability of such purchase, which may have been made or given by the LLC, any
other Unitholder or by any agent or employee of any other Unitholder; provided, however,
that the LLC acknowledges the representations and warranties it has made to the Rollover
Holders in their respective Contribution and Exchange Agreements; (viii) this Agreement
is valid, binding and enforceable against such Unitholder in accordance with its terms,
except to the extent that such enforceability may be limited by applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or other similar laws
generally affecting creditorsβ rights and general equitable principles (regardless of whether
enforcement is sought in equity or at law); and (ix) the Units cannot be Transferred except
in compliance with the terms of this Agreement.
(f) No Liability of Unitholders.
(i) No Liability. Except as otherwise required by applicable law
and as expressly set forth in this Agreement, no Unitholder shall have any personal liability
whatsoever in such Unitholderβs capacity as a Unitholder, whether to the LLC, to any of
the other Unitholders, to the creditors of the LLC or to any other third party, for the debts,
liabilities, commitments or any other obligations of the LLC or for any losses of the LLC.
Each Unitholder shall be liable only to make such Unitholderβs Capital Contribution to the
LLC and the other payments provided expressly herein.
(ii) Distribution. In accordance with the Delaware Act and the
laws of the State of Delaware, an equityholder of a limited liability company may, under
certain circumstances, be required to return amounts previously distributed to such
equityholder. It is the intent of the Unitholders that no Distribution to any Unitholder
pursuant to Article IV hereof shall be deemed a return of money or other property paid or
distributed in violation of the Delaware Act. The payment of any such money or
distribution of any such property to a Unitholder shall be deemed to be a compromise
within the meaning of the Delaware Act, and the Unitholder receiving any such money or
property shall not be required to return to any Person any such money or property.
However, if any court of competent jurisdiction holds that, notwithstanding the provisions
of this Agreement, any Unitholder is obligated to make any such payment, such obligation
shall be the obligation of such Unitholder and not of any other Unitholder.
3.2. Unitholder Meetings.
(a) Voting of Unitholders. Except for the voting, approval and consent
rights of the Principal Investors expressly provided by this Agreement (including pursuant
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to Section 5.1(b)(iv)), none of the Unitholders shall have any voting, approval or consent
rights under this Agreement or the Delaware Act with respect to the Units held by such
Person, including with respect to any matters to be decided by the LLC or any other
governance matters described in this Agreement, and each Unitholder, by its acceptance
thereof, expressly waives any consent, approval or voting rights (except to the extent
expressly provided to the Principal Investors in this Agreement) or other rights to
participate in the governance of the LLC, whether such rights may be provided under the
Delaware Act (including under §§ 18-209(b), 18-213(b), 18-215(g), 18-215(k), 18-216(b),
18-301(b)(1), 18-302(a), 18-302(f), 18-304, 18-702(a), 18-704(a), 18-801(a), 18-803(a) or
18-806 thereof) or otherwise.
(b) Voting; Quorum. A quorum shall be present at a meeting of
Unitholders if the Principal Investors are represented at the meeting in person or by proxy.
With respect to any matter, other than a matter for which the affirmative vote of the holders
of a specified portion of all Unitholders entitled to vote is required by the Delaware Act or
by this Agreement (including Section 5.1(b)(iv)), the affirmative vote of Unitholders
holding a Required Interest at a meeting of Unitholders at which a quorum is present shall
be the act of the Unitholders.
(c) Place. All meetings of the Unitholders shall be held at the principal
office of the LLC or at such other place within or without the State of Delaware as shall be
specified or fixed in the notices or waivers of notice thereof; provided that any or all
Unitholders may participate in any such meeting by means of conference telephone or
similar communications equipment pursuant to Section 3.3(d).
(d) Adjournment. Notwithstanding the other provisions of the
Certificate or this Agreement to the contrary, the chairperson of the meeting or Unitholders
holding a Required Interest shall have the power to adjourn such meeting from time to
time, without any notice other than announcement at the meeting of the time and place of
the holding of the adjourned meeting. If such meeting is adjourned by the Unitholders,
such time and place shall be determined by Unitholders holding a Required Interest. Upon
the resumption of such adjourned meeting, any business may be transacted that might have
been transacted at the meeting as originally called.
(e) Annual Meeting. An annual meeting of the Unitholders, for the
election of Managers and for the transaction of such other business as may properly come
before the meeting, shall be held at such place, within or without the State of Delaware, on
such date and at such time as the Board shall fix and set forth in the notice of the meeting,
which date shall be within thirteen months subsequent to the date of organization of the
LLC or the last annual meeting of Unitholders, whichever most recently occurred.
Notwithstanding the foregoing, in the absence of any such annual meeting, the Managers
then in office shall continue to be Managers of the LLC until the earlier of their death,
resignation or removal.
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(f) Special Meetings. Special meetings of the Unitholders for any
proper purpose or purposes may be called at any time by the Board or Unitholders holding
a Required Interest. If not otherwise stated in or fixed in accordance with the remaining
provisions hereof, the record date for determining Unitholders entitled to call a special
meeting is the date any Unitholder first signs the notice of that meeting. Only business
within the purpose or purposes described in the notice (or waiver thereof) required by this
Agreement may be conducted at a special meeting of the Unitholders.
(g) Notice. A written or printed notice stating the place, day and hour
of the meeting and, in the case of a special meeting, the purpose or purposes for which the
meeting is called, shall be delivered to each Unitholder entitled to vote at the applicable
meeting in accordance with Section 15.15 below not less than two or more than 60 days
before the date of the meeting, by or at the direction of the Board or the Unitholders calling
the meeting. A vote of the Unitholders otherwise entitled to vote at a meeting of the
Unitholders shall be valid and binding only if a notice of the meeting at which such vote is
taken is given to all Unitholders entitled to vote at such meeting in accordance with this
Section 3.2(g).
(h) Record Date. The date on which notice of a meeting of Unitholders
is mailed or the date on which the resolution of the Board declaring a distribution is
adopted, as the case may be, shall be the record date for the determination of the
Unitholders entitled to notice of or to vote at such meeting (including any adjournment
thereof) or the Unitholders entitled to receive such distribution.
(i) Proxies. A Unitholder may vote either in person or by proxy
executed in writing by the Unitholder. A telegram, telex, cablegram or similar transmission
by the Unitholder, or a photographic, photostatic, facsimile or similar reproduction of a
writing executed by the Unitholder shall be treated as an execution in writing for purposes
of this Section 3.2(i). Proxies for use at any meeting of Unitholders or in connection with
the taking of any action by written consent pursuant to Section 3.3 shall be filed with an
Officer authorized by the Board, before or at the time of the meeting or execution of the
written consent as the case may be. All proxies shall be received and taken charge of and
all ballots shall be received and canvassed by an Officer authorized by the Board, who shall
decide all questions concerning the qualification of voters, the validity of the proxies and
the acceptance or rejection of votes, unless an inspector or inspectors shall have been
appointed by the chairperson of the meeting, in which event such inspector or inspectors
shall decide all such questions. No proxy shall be valid after 11 months from the date of
its execution unless otherwise provided in the proxy. A proxy shall be revocable unless
the proxy form conspicuously states that the proxy is irrevocable and the proxy is coupled
with an interest. A Unitholder may designate one or more Persons to act as proxy, and
should a proxy designate two or more Persons to act as proxies, unless that instrument shall
provide to the contrary, a majority of such Persons present at any meeting at which their
powers thereunder are to be exercised shall have and may exercise all the powers of voting
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or giving consents thereby conferred, or if only one be present, then such powers may be
exercised by that one; or, if an even number attend and a majority do not agree on any
particular issue, the LLC shall not be required to recognize such proxy with respect to such
issue if such proxy does not specify how the Units that are the subject of such proxy are to
be voted with respect to such issue.
(j) Conduct of Unitholder Meetings. All meetings of the Unitholders
shall be presided over by the chairperson of the meeting, who shall be one of the Managers
(as determined by Unitholders holding a Required Interest). The chairperson of any
meeting of Unitholders shall determine the order of business and the procedure at the
meeting, including such regulation of the manner of voting and the conduct of discussion
as seem to him or her in order.
(k) Voting Rights. The holders of the Units entitled to vote at any
applicable meeting shall be entitled to notice of such meeting in accordance with this
Agreement, and except as otherwise required by law, the holders of the Units shall be
entitled to vote on all matters submitted to the Unitholders for a vote with each Unit entitled
to one vote. Except as otherwise expressly provided in this Agreement (including, for the
avoidance of doubt, Section 5.1(b)(iv)) or as required by law, the vote, consent or approval
of Unitholders holding a Required Interest shall constitute the act of the Unitholders.
3.3. Action of Unitholders by Written Consent or Telephone Conference.
(a) Written Consent in Lieu of Meeting. Subject to the terms of this
Agreement (including, for the avoidance of doubt, Section 5.1(b)(iv)), any action required
or permitted to be taken at any annual or special meeting of Unitholders may be taken
without a meeting, without prior notice and without a vote, if a consent or consents in
writing, setting forth the action so taken, shall be signed by the Unitholder or Unitholders
holding not less than the minimum percentages of Units that would be necessary to take
such action at a meeting at which all Unitholders entitled to vote on the action were present
and voted in accordance with Section 3.2(k). Every written consent shall bear the date of
signature of each Unitholder who signs the consent (or a counterpart thereof). No written
consent shall be effective to take the action that is the subject to the consent unless, within
60 days after the date of the earliest dated consent delivered to the LLC in the manner
required by this Section 3.3(a), a consent or consents signed by the Unitholder or
Unitholders holding not less than the minimum Units that would be necessary to take the
action that is the subject of the consent are delivered to the LLC by delivery to its registered
office, its principal place of business or the Board. Delivery shall be by hand or certified
or registered mail, return receipt requested. Delivery to the LLCβs principal place of
business shall be addressed to the Board. A telegram, telex, cablegram, electronic mail or
similar transmission by a Unitholder, or a photographic, photostatic, facsimile, PDF or
similar reproduction of a writing signed by a Unitholder, shall be regarded as signed by the
Unitholder for purposes of this Section 3.3(a). Prompt notice of the taking of any action
by Unitholders without a meeting by less than unanimous written consent shall be given to
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those Unitholders who were otherwise entitled to vote but did not consent in writing to the
action.
(b) Record Date for Written Consent in Lieu of Meeting. The record
date for determining Unitholders entitled to consent to action in writing without a meeting
shall be the first date on which a signed written consent setting forth the action taken or
proposed to be taken is delivered to the LLC by delivery to its registered office, its principal
place of business, or the Board. Delivery shall be by hand or by certified or registered
mail, return receipt requested. Delivery to the LLCβs principal place of business shall be
addressed to the Board.
(c) Filings. If any action by Unitholders is taken by written consent,
any certificate or documents filed with the Secretary of State of Delaware as a result of the
taking of the action shall state, in lieu of any statement required by the Delaware Act
concerning any vote of Unitholders, that written consent has been given in accordance with
the provisions of the Delaware Act and that any written notice required by the Delaware
Act has been given.
(d) Telephone Conference. Unitholders may participate in and hold a
meeting by means of conference telephone or similar communications equipment by means
of which all Persons participating in the meeting can hear each other, and participation in
such meeting shall constitute attendance and presence in person at such meeting, except
where a Person participates in the meeting for the express purpose of objecting to the
transaction of any business on the ground that the meeting is not lawfully called or
convened.
3.4. Issuance of Additional Units and Interests. Subject to compliance with
the provisions of this Agreement (including Section 5.1(b)(iv)), the Board shall have the
right to cause the LLC to authorize, designate, issue or sell to any Person (including
Unitholders and Affiliates) any additional Equity Securities (which for purposes of this
Agreement shall be βAdditional Securitiesβ). Subject to the provisions of this Agreement,
including Section 5.1(b)(iv), the Board shall determine the terms and conditions governing
the issuance of such Additional Securities, including the number and designation of such
Additional Securities, the designations, preferences (with respect to distributions,
liquidations, or otherwise) over any other Units and relative, participating, optional or other
special rights, powers and duties, including rights, powers and duties senior or junior to, or
pari passu with, any other Units, any required contributions in connection therewith and
voting rights. Subject to Section 5.1(b)(iv) and Section 15.3, the Board shall, in its sole
discretion, be permitted to amend this Agreement in connection with the authorization,
designation reservation or issuance of any Additional Securities. Any Person who acquires
Units may be admitted to the LLC as a Unitholder pursuant to the terms of Section 11.2
hereof. If any Person acquires additional Units or other interests in the LLC or is admitted
to the LLC as an Additional Unitholder, the LLC shall amend Schedule A to reflect such
additional issuance and/or Unitholder, as the case may be.
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3.5. Preemptive Rights.
(a) If, prior to an initial Public Offering, the Board authorizes the
issuance or sale of any Units, any equity Securities of any of the LLCβs Subsidiaries or any
securities convertible into, or exchangeable or exercisable for any such Units or equity
Securities (any of the foregoing, βPreemptive Securitiesβ), the LLC shall offer to sell to
each of the Subject Holders, or one or more Affiliates of such Subject Holder designated
for such purpose, that certifies (to the reasonable satisfaction of the LLC) that it is an
Accredited Investor (the βOther Accredited Unitholdersβ), at the same price and on the
same terms, an amount of Preemptive Securities (with respect to each Other Accredited
Unitholder, the βPreemptive Portionβ) equal to the product (rounded down to the nearest
whole number) of (A) the Preemptive Pro Rata Percentage of such Other Accredited
Unitholder, multiplied by (B) the number of Preemptive Securities then contemplated to
be issued by the LLC. Subject to Section 3.1(a)(ii), each Other Accredited Unitholder shall
be entitled to purchase his, her or its Preemptive Portion of such Preemptive Securities at
the price and on the terms set forth in the Issuance Notice. The purchase price for all
Preemptive Securities to be offered to the Other Accredited Unitholders under this Section
3.5 shall be payable in cash. It is understood by the parties hereto that the LLC may proceed
with the consummation of the issuance of Preemptive Securities prior to offering such
securities to the Other Accredited Unitholders; provided that an Issuance Notice (as defined
below) is delivered to each of the Other Accredited Unitholders in accordance with Section
3.5(b) below.
(b) The LLC shall deliver to each Other Accredited Unitholder a written
notice (an βIssuance Noticeβ) describing in reasonable detail the Preemptive Securities
being offered in the applicable issuance under this Section 3.5, the purchase price thereof,
the payment terms and such Other Accredited Unitholderβs percentage allotment prior to
the closing of the issuance, or, if no such notice is delivered prior to such closing, no later
than fifteen (15) days after such closing. In order to exercise its purchase rights hereunder,
each Other Accredited Unitholder must within twenty (20) days after receipt of an Issuance
Notice, deliver a written notice to the LLC describing its election to purchase all or any
portion of his, her or its Preemptive Portion of the applicable Preemptive Securities under
this Section 3.5. Each Other Accredited Unitholder who has not accepted such offer within
such period shall be deemed to have waived all of such Other Accredited Unitholderβs
rights to participate in such issuance. In the event that all of the Preemptive Securities have
not been subscribed for pursuant to this Section 3.5(b) following the delivery of the initial
Issuance Notice, then (subject to Section 3.1(a)(ii)) the Preemptive Securities not
subscribed for shall be reoffered pursuant to the provisions of this Section 3.5(b) one
additional time to all such Other Accredited Unitholders who have elected to purchase their
respective Preemptive Portions (each a βParticipating Purchaserβ); provided, that in such
case of any reoffering, the applicable period to make an election to purchase with respect
to such Preemptive Securities shall be five (5) Business Days, and each Participating
Purchaser shall be permitted to commit to acquire all or any portion of the remaining
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Preemptive Securities being offered pursuant to this Section 3.5(b) (and any over
commitment shall be cut back pro rata on the basis of each such Participating Purchaserβs
relative Preemptive Portion). Following such reoffering of remaining Preemptive
Securities, the LLC shall thereafter be free to issue any remaining Preemptive Securities in
such issuance not already subscribed for by the Participating Purchasers to other
prospective subscribers at a price no less than the price set forth in the Issuance Notice and
on the other terms set forth in the Issuance Notice. If one or more Other Accredited
Unitholders elects to purchase Preemptive Securities under this Section 3.5, the closing of
such purchase shall occur no later than 120 days after receipt by the LLC of such election.
(c) Notwithstanding the foregoing (but subject, in each case, to
compliance with the other provisions of this Agreement, including Section 5.1(b)(iv)), the
rights set forth in this Section 3.5 shall not apply to any issuance of Preemptive Securities
(i) upon the conversion, exchange or exercise of any then outstanding Equity Securities in
accordance with their respective terms, (ii) to financing sources of the LLC or any of its
Subsidiaries in connection with the issuance of debt or restructuring or recapitalization of
existing debt; (iii) in connection with grants of Units (including Value Units) or options to
officers, directors, employees or consultants of the LLC or any of its Subsidiaries issued
pursuant to a plan approved by the Board (including the Plan); (iv) pursuant to a stock (or
similar) split, dividend, combination, reorganization, recapitalization or similar event; (v)
in connection with a Public Offering; (vi) in connection with a Sale of the LLC; (vii) to the
sellers of a company, business, division or enterprise as part of the consideration (in whole
or in part) for such acquisition by any member of the Company Group; or (viii) in
connection with issuances of Common Units to officers, directors, employees or
consultants of the LLC or any of its Subsidiaries issued for cash and not in excess of the
amount of Common Units designated therefor on Schedule B.
(d) The LLC shall have 120 days from the date of the Issuance Notice
to consummate the proposed issuance of any or all of such Units that the Other Accredited
Unitholders have elected to purchase under this Section 3.5 at the same price and terms
that are specified in the Issuance Notice; provided that, if such issuance is subject to
regulatory approval, such 120-day period shall be extended until the expiration of five
Business Days after all such approvals have been received, but in no event later than 270
days from the date of the Issuance Notice. If the LLC proposes to issue any series of Units
after such 120 or 270-day period, it shall again comply with the procedures set forth in this
Section 3.5 (to the extent applicable).
(e) The LLC shall not be under any obligation to consummate any
proposed issuance of Preemptive Securities, nor shall there be any liability on the part of
the LLC to any Unitholder if the LLC has not consummated any proposed issuance of
Preemptive Securities pursuant to this Section 3.5 for whatever reason, regardless of
whether it shall have delivered an Issuance Notice in respect of such proposed issuance.
Without limiting the generality of the foregoing, if the LLC shall not issue any Preemptive
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Securities to which an Issuance Notice relates, the LLC shall have no liability to issue to
any Other Accredited Unitholder his, her or its Preemptive Portion of the Preemptive
Securities.
3.6. Capital Accounts.
(a) There shall be established on the books and records of the LLC a
capital account (a βCapital Accountβ) for each Unitholder.
(b) Each Unitholderβs Capital Account shall be adjusted:
(i) by adding any Capital Contributions made by such
Unitholder (including the Capital Contributions made in exchange for any Units);
(ii) by deducting any amounts paid to such Unitholder in
connection with the redemption or other repurchase by the LLC of Units;
(iii) by adding any Profits allocated in favor of such Unitholder
and subtracting any Losses allocated in favor of such Unitholder; and
(iv) by deducting any distributions paid in cash or other assets to
such Unitholder by the LLC (excluding any amount paid to such Unitholder pursuant to
the Subscription Agreement or the Advisory Agreement).
(c) Each Unitholderβs Capital Account shall be further adjusted with
respect to any special allocations or adjustments pursuant to this Agreement. The LLC
may adjust the Capital Accounts of its Unitholders, in accordance with Treasury
Regulations Section 1.704-l(b)(2)(iv)(f), to reflect revaluations (including any unrealized
income, gain or loss) of the LLCβs property (including intangible assets such as goodwill),
whenever it issues additional Units, or whenever the adjustments would otherwise be
permitted under such Treasury Regulations. In the event that the Capital Accounts of the
Unitholders are so adjusted, (i) the Capital Accounts of the Unitholders shall be adjusted
in accordance with Treasury Regulations Section 1.704-1(b)(2)(iv)(g) for allocations of
depreciation, depletion, amortization and gain or loss, as computed for book purposes, with
respect to such property and (ii) the Unitholdersβ distributive shares of depreciation,
depletion, amortization and gain or loss, as computed for tax purposes, with respect to such
property shall be determined so as to take account of the variation between the adjusted tax
basis and book value of such property in the same manner as under Section 704(c) of the
Code and Section 4.3 of this Agreement. The Capital Accounts shall be maintained for the
sole purpose of allocating items of income, gain, loss and deductions among the
Unitholders and shall have no effect on the amount of any distributions to any Unitholder
in liquidation or otherwise. The provisions of this Agreement relating to the maintenance
of Capital Accounts are intended to comply with Treasury Regulations Sections 1.704-1(b)
and 1.704-2 and shall be interpreted and applied in a manner consistent with such Treasury
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Regulations, and the LLC shall be permitted to adjust the Capital Accounts of the
Unitholders in a manner consistent with such Treasury Regulations. Any contributions of
property after the Effective Date shall be valued at their Fair Market Value (as will be
reflected on Schedule A hereto).
3.7. Negative Capital Accounts. No Unitholder shall be required to pay to any
other Unitholder or the LLC any deficit or negative balance which may exist from time to
time in such Unitholderβs Capital Account (including upon and after dissolution of the
LLC).
3.8. No Withdrawal. No Person shall be entitled to withdraw any part of such
Personβs Capital Contributions or Capital Account or to receive any Distribution from the
LLC, except as expressly provided herein or in the other agreements referred to herein.
3.9. Loans From Unitholders. If Unitholders make loans to the LLC (subject
to Section 5.1(b)(iv)); (a) such loans shall not be considered Capital Contributions; (b) the
making of such loans shall not result in any increase in the amount of the Capital Account
of such Unitholder; and (c) the amount of any such loans shall be a debt of the LLC to such
Unitholder and shall be payable or collectible in accordance with the terms and conditions
upon which such loans are made.
3.10. Additional Terms Applicable to Value Units.
(a) Certain Terms.
(i) Forfeiture of Value Units. A Management Unitholderβs
Value Units shall be subject to forfeiture in accordance with Section 3.10(b)(i).
(ii) Certain Cancellations. In the event that any portion of the
Value Units does not become eligible to participate in distributions pursuant to Section
4.1(a) upon the first occurrence of a Sale of the LLC, after taking into account distributions
from the LLC or proceeds from the sale of Units in connection with such Sale of the LLC,
such portion of such Value Units shall automatically be canceled without payment therefor.
(iii) Calculations. All calculations required or contemplated by
Section 4.1 shall be made in the good faith determination of the Board, and, absent manifest
error or failure to comply with the terms of this Agreement, shall be final and binding on
the LLC and each Management Unitholder and Operating Unitholder.
(iv) Profits Interests. The Board shall determine a benchmark
amount with respect to each Value Unit at the time such Value Unit is issued to a
Unitholder (a βBenchmark Amountβ), which shall be reflected on Schedule A. The LLC
and the Unitholder intend that each Value Unit be treated as a separate βprofits interestβ
for U.S. federal income tax purposes within the meaning of Internal Revenue Service Rev.
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Proc. 93-27 and Rev. Proc. 2001-43 or such other subsequent Internal Revenue Service
rulings defining βprofits interestsβ as of the date such Value Unit is issued, and this
Agreement shall be interpreted to give effect to such intention. Notwithstanding any other
provision of this Agreement, (A) each Unitholder shall, and shall cause each of its
Affiliates and transferees to, take any action requested by the Board to ensure that the fair
market value of any Value Unit at the time of issuance is treated for U.S. federal income
tax purposes as being equal to the βliquidation valueβ (within the meaning of Proposed
Treasury Regulations Section 1.83-3(1)) of such Unit (and that each such Unit is afforded
pass-through treatment for all applicable U.S. federal, state and local income tax purposes)
and (B) without limiting the generality of the foregoing, to the extent required in order to
attain or ensure such treatment under any applicable law, revenue procedure, revenue
ruling, notice or other guidance governing partnership interests transferred in connection
with the performance of services, such action may include authorizing and directing the
LLC to make any election, agreeing to any condition imposed on such Unitholder, its
Affiliates or its transferees, executing any amendment to this Agreement or other
agreements, executing any new agreement, making any tax election or tax filing, and
agreeing not to take any contrary position unless required pursuant to applicable law.
(v) The Value Units reserved for issuance under the Plan shall
be subject in all respects to the terms, provisions, restrictions and conditions as are set forth
in this Agreement, the Plan and the applicable award agreement or other document
pursuant to which such Value Units awards were granted.
(b) Effects of Termination of Employment on Value Units.
(i) Forfeiture of Value Units upon Termination.
(A) Termination for Cause. Unless otherwise
determined by the Board in a manner more favorable to such Management Unitholder or
Operating Unitholder, as applicable, or otherwise set forth in an agreement between such
Management Unitholder or Operating Unitholder, as applicable, and the LLC, in the event
that a Management Unitholderβs employment with or an Operating Unitholderβs Service to
the LLC or any Subsidiary of the LLC is terminated for Cause, all of the Value Units issued
to such Management Unitholder or Operating Unitholder (whether vested or not) shall be
forfeited immediately and automatically upon such termination.
(B) Other Termination. Unless otherwise determined by
the Board in a manner more favorable to such Management Unitholder or Operating
Unitholder, as applicable, or otherwise set forth in an agreement between such Unitholder
and the LLC, in the event that a Management Unitholderβs employment with or an
Operating Unitholderβs Service to the LLC or any Subsidiary of the LLC is terminated for
any reason, other than for Cause, then all unvested Value Units issued to such Management
Unitholder or Operating Unitholder shall be forfeited immediately and automatically upon
such termination. If all or any portion of a Management Unitholderβs or Operating
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Unitholderβs Value Units are not so forfeited, they shall remain outstanding in accordance
with their applicable terms. Notwithstanding the foregoing, during the ninety (90) day
period following such termination of employment or Service, as applicable, the Board may
elect (with the consent of the Principal Investors) (the βRepurchase Optionβ) to repurchase
the vested Value Units from the applicable the Management Unitholder or Operating
Unitholder, and upon such election the Management Unitholder or Operating Unitholder
shall be obligated to sell such vested Value Units to the LLC, in each case, for a price equal
to the Fair Market Value, as determined by the Board, of such Value Units as of the date
of termination of employment or Service (the βRepurchase Priceβ). In the event that,
following the Boardβs exercise of the Repurchase Option, the LLC is prohibited pursuant
to its existing loan documents or otherwise from paying the Repurchase Price in respect of
the Repurchase Option, the Board may elect that the LLC pay the Repurchase Price in the
form of a promissory note (on market terms and conditions) to the applicable Management
Unitholder or Operating Unitholder, and upon the issuance of such promissory notes the
vested Value Units shall be immediately cancelled and shall no longer be deemed
outstanding.
(ii) Inactive Unitholders. Subject to the last sentence of this
clause (ii), if a Management Unitholderβs employment with or an Operating Unitholderβs
Service to the LLC or any Subsidiary of the LLC terminates for any reason, such Unitholder
shall thereafter be referred to herein as an βInactive Unitholderβ with only the rights (and
applicable restrictions) of an Inactive Unitholder specified herein. Notwithstanding
anything to the contrary, such Inactive Unitholder shall continue to be treated as a
Unitholder solely for purposes of any applicable allocations or distributions, which shall
be deemed for tax purposes to be made to such Inactive Unitholder in its capacity as a
Unitholder, until such time as all Units retained by such Inactive Unitholder are Transferred
or repurchased in accordance with this Agreement. Notwithstanding the foregoing, the
Ekbatani Holder shall only become an Inactive Unitholder pursuant to Section 3.11(b) or
Section 3.12(b), as applicable, below.
(iii) Effect of Forfeiture. Any Value Unit which is forfeited shall
be cancelled for no consideration.
(iv) Accelerated Vesting Upon a Sale of the LLC. Unless
otherwise set forth in an agreement between such Management Unitholder or Operating
Unitholder, as applicable, and the LLC, the Board, in its sole and absolute discretion, may
elect, immediately prior to the occurrence of a Sale of the LLC, to accelerate the vesting of
any then-unvested Value Units then held by any Management Unitholder or Operating
Unitholder (and not previously forfeited).
(c) Nontransferability of Awards. Notwithstanding anything to the
contrary, no Value Units may be Transferred, other than subject to approval by the Board
in any individual case (including such additional terms and conditions as the Board shall
require), to a transferee under Article X.
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(d) Treatment in an Initial Public Offering. In connection with an initial
Public Offering, the holders of any Value Units that are not then vested may, in the Boardβs
sole discretion, receive restricted securities of comparable economic value, in exchange for
and cancellation of such Value Units, (i) that are subject to similar restrictions, vesting and
forfeiture provisions as are described in this Agreement and the applicable award
agreement or other document pursuant to which such Value Units awards were granted and
(ii) the form and substance of which will determined at the sole discretion of the Board;
provided that the tax treatment of such securities may be different than that of the Value
Units.
3.11. Effects of a Trigger Event.
(a) During the ninety (90) day period following the date on which any
executive officer of the Company or member the Board is actually notified of a Trigger
Event, the LLC (with the consent of the Principal Investors) may elect, by written notice
thereof to the Ekbatani Holder, to repurchase all or any portion of the Units then held by
the Ekbatani Holder (the βEkbatani Repurchase Optionβ) and, following notice of such
election so delivered within such ninety (90) period, the Ekbatani Holder shall be obligated
to sell such Units to the LLC, in each case, for a cash price equal to the Fair Market Value
of such Units as of the date of repurchase thereof, as determined by the Board and specified
in such notice (which determination, for the avoidance of doubt, will take into account the
Unpaid Equity Value Amount and the features of the distribution waterfall set forth in
Section 4.1 with respect to the Units then-held by the Ekbatani Holder) (subject to Section
14.3 below, the βEkbatani Repurchase Priceβ). In the event that, following the LLCβs
exercise of the Ekbatani Repurchase Option, the LLC is prohibited pursuant to its then-
existing senior debt financing arrangements from paying the Ekbatani Repurchase Price
(or any portion thereof) in respect of the Ekbatani Repurchase Option, the LLC shall pay
the Ekbatani Repurchase Price (or any portion thereof) in the form of a promissory note
(on market terms and conditions) to the Ekbatani Holder due upon the repayment or
refinancing of the LLCβs then-existing senior debt financing arrangements, and upon the
issuance of such promissory note the Units then so repurchased from the Ekbatani Holder
in exchange therefor shall be immediately cancelled and shall no longer be deemed
outstanding. The LLC and the Ekbatani Holder shall be required to consummate an
Ekbtatani Repurchase Option during the thirty (30) day period following delivery to the
Ekbatani Holder of notice thereof (subject to the right to Dispute pursuant to Section 14.3)
or, if prior to such date the Ekbatani Holder has delivered to the LLC a notice of a Dispute
pursuant to Section 14.3 below, during the thirty (30) day period following the final
determination of the Fair Market Value of the Units to be repurchased pursuant to such
Section 14.3.
(b) Upon the LLCβs delivery to the Ekbatani Holder of its notice of
election to exercise the Ekbatani Repurchase Option, the Ekbatani Holder shall thereafter
for so long as such Ekbatani Repurchase Option is pending and only with respect to the
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Units being repurchased pursuant to such Ekbatani Repurchase Option, be referred to
herein as an βInactive Unitholderβ with only the rights (and applicable restrictions) of an
Inactive Unitholder specified herein. Notwithstanding anything to the contrary, such
Inactive Unitholder for so long as such Ekbatani Repurchase Option is pending and only
with respect to the Units being repurchased pursuant to such Ekbatani Repurchase Option,
shall continue to be treated as a Unitholder solely for purposes of any applicable allocations
or distributions, which shall be deemed for tax purposes to be made to such Inactive
Unitholder in its capacity as a Unitholder, until such time as all Units retained by such
Inactive Unitholder are Transferred or repurchased in accordance with this Agreement.
3.12. Effects of an Excess Escrow Loss.
(a) In the event that, pursuant to Article X of the DPN Purchase
Agreement (and subject to the terms thereof), it has been determined by (i) a final, non-
appealable order or judgment of a court of competent jurisdiction or (ii) a written, executed
agreement between the Buyer and the Sellersβ Representative, that the Buyer has suffered
an Excess Escrow Loss for which the Sellers are obligated to indemnify the Buyer under
the DPN Purchase Agreement, then during the ninety (90) day period following the date
on which such Excess Escrow Loss is so finally determined, the LLC (with the consent of
the Principal Investors) may elect, by written notice thereof to the Rollover Holders, to
repurchase and redeem, in satisfaction of all or a portion of such Excess Escrow Loss, all
or a portion of the Units then held by the Rollover Holders (pro rata in proportion to the
amount of the Excess Escrow Loss allocable to such Rollover Holder as a Seller under the
DPN Purchase Agreement) having an aggregate Fair Market Value at the time of such
election equal to the amount of such Excess Escrow Loss being so satisfied (the βRollover
Call Optionβ) as determined by the Board (subject to Section 14.3) and specified in such
notice (which determination, for the avoidance of doubt, will take into account the Unpaid
Equity Value Amount and the features of the distribution waterfall set forth in Section 4.1
with respect to the Units then-held by the Rollover Holders) and, following notice of such
election so delivered within such ninety (90) period, the Rollover Holders shall be
obligated to sell such Units to the LLC, in each case, for no consideration; provided,
however, in no event shall the aggregate Fair Market Value of any Units repurchased or
redeemed pursuant to this Section 3.12 in satisfaction of all or a portion of such Excess
Escrow Loss, exceed $6,000,000. The LLC and the Rollover Holders shall be required to
consummate any Rollover Call Option during the thirty (30) day period following delivery
to the Rollover Holders of notice thereof (subject to the right to Dispute pursuant to Section
14.3) or, if prior to such date the Rollover Holders have delivered to the LLC a notice of a
Dispute pursuant to Section 14.3 below, during the thirty (30) day period following the
final determination of the Fair Market Value of the Units to be repurchased pursuant to
such Section 14.3.
(b) Upon the LLCβs delivery to the Rollover Holders of its notice of
election to exercise the Rollover Call Option, the Rollover Holders shall thereafter for so
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long as such Rollover Call Option is pending and only with respect to the Units being
repurchased and redeemed pursuant to such Rollover Call Option, be referred to herein as
βInactive Unitholdersβ with only the rights (and applicable restrictions) of Inactive
Unitholders specified herein. Notwithstanding anything to the contrary, such Inactive
Unitholders for so long as such Rollover Call Option is pending and only with respect to
the Units being repurchased pursuant to such Rollover Call Option, shall continue to be
treated as a Unitholders solely for purposes of any applicable allocations or distributions,
which shall be deemed for tax purposes to be made to each such Inactive Unitholder in its
capacity as a Unitholder, until such time as all Units retained by such Inactive Unitholder
are Transferred or repurchased in accordance with this Agreement.
ARTICLE IV
DISTRIBUTIONS; ALLOCATIONS AND REDEMPTIONS
4.1. Distributions.
(a) Distributions Generally. Except as otherwise set forth in this
Section 4.1, and subject to Section 5.1(b)(iv) and the provisions of Section 18-607 of the
Delaware Act, the Board may make Distributions at any time or from time to time as
determined by Board in its discretion (after taking into account the anticipated cash needs
of the business, the existing liabilities and expenses of the LLC and a reasonable reserves
for future liabilities and expenses of the LLC). Subject to the foregoing, except as
otherwise set forth in this Section 4.1, and subject to Section 5.1(b)(iv) and the provisions
of Section 18-607 of the Delaware Act, all Distributions shall be made to the Unitholders
as follows:
(i) First, to the Common Holders, pro rata in accordance with
their Capital Contributions, until the cumulative amount distributed to such Common
Holders pursuant to this Section 4.1(a)(i) equals the aggregate unreturned Capital
Contributions made by such Common Holders with respect to the Common Units owned
by such Common Holders, and no distribution or any portion thereof shall be made under
any other paragraphs of this Section 4.1(a) until such cumulative amount of unreturned
Capital Contributions in respect of Common Units has been distributed;
(ii) Thereafter, to the Common Holders and the Value A
Holders, pro rata in accordance with their respective ownership in such Units, until the
cumulative amount distributed to the Common Holders pursuant to this Section 4.1(a)
equals the Value B Threshold, and no distribution or any portion thereof shall be made
under paragraphs (iii), (iv) or (v) of this Section 4.1(a) until such amount has been
distributed; provided, however, that no distribution or any portion thereof shall be made in
respect of any Class B Common Units under this Section 4.1(a)(ii) or under paragraphs
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(iii), (iv) or (v) of this Section 4.1(a) until the entire amount of the Unpaid Equity Value
Amount as of the time of such distribution has been distributed in full to the Unitholders
(other than the Class B Holders);
(iii) Thereafter, to the Common Holders, the Value A Holders,
and the Value B Holders, pro rata in accordance with their respective ownership in such
Units, until the cumulative amount distributed to the Common Holders pursuant to this
Section 4.1(a) equals the Value C Threshold, and no distribution or any portion thereof
shall be made under paragraphs (iv) or (v) of this Section 4.1(a) until such amount has been
distributed; provided, however, that no distribution or any portion thereof shall be made in
respect of any Class B Common Units under this Section 4.1(a)(iii) or under paragraphs
(iv) or (v) of this Section 4.1(a) until the entire amount of the Unpaid Equity Value Amount
as of the time of such distribution has been distributed in full to the Unitholders (other than
the Class B Holders);
(iv) Thereafter, to the Common Holders, the Value A Holders,
the Value B Holders, and the Value C Holders, pro rata in accordance with their respective
ownership in such Units, until the cumulative amount distributed to the Common Holders
pursuant to this Section 4.1(a) equals the Value D Threshold, and no distribution or any
portion thereof shall be made under paragraph (v) of this Section 4.1(a) until such amount
has been distributed; provided, however, that no distribution or any portion thereof shall
be made in respect of any Class B Common Units under this Section 4.1(a)(iv) or under
paragraph (v) of this Section 4.1(a) until the entire amount of the Unpaid Equity Value
Amount as of the time of such distribution has been distributed in full to the Unitholders
(other than the Class B Holders); and
(v) Thereafter, to the Common Holders, the Value A Holders,
the Value B Holders, the Value C Holders, and the Value D Holders, pro rata in accordance
with their respective ownership in such Units; provided, however, that no distribution or
any portion thereof shall be made in respect of any Class B Common Units under this
Section 4.1(a)(v) until the entire amount of the Unpaid Equity Value Amount as of the time
of such distribution has been distributed in full to the Unitholders (other than the Class B
Holders).
(b) Notwithstanding the foregoing, the amount of any proposed
distribution to a holder of any participating Value Unit pursuant to Section 4.1(a) in respect
of such Value Unit shall be reduced (and no distributions shall be made in respect of any
such Value Unit) until the total reductions in proposed distributions pursuant to this Section
4.1(b) in respect of such Value Unit equals the Benchmark Amount in respect of such
Value Unit. Any amount that is not distributed to the holder of any Value Unit pursuant to
this Section 4.1(b) shall be distributed to the remaining Members pursuant to Section
4.1(a).
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(c) In the event that (i) a Sale of the LLC is structured as a sale of LLC
Interests by the Members, rather than a distribution of proceeds by the LLC or (ii) there is
a sale of LLC Interests pursuant to Section 10.4 or 10.6 involving LLC Interests of a
different class or sub-class, the purchase agreement governing such sale will have
provisions therein which replicate, to the greatest extent possible, the economic result
which would have been attained under this Article IV had the Sale of the LLC or such sale
been structured as a sale of the LLCβs assets and a distribution of proceeds thereof (or, in
the context of a sale event only, modifications will be made to this Agreement to
accomplish this result).
(d) For the avoidance of doubt, it is understood that references herein to
Value Units that βwill not participate in distributions under Article IVβ or any similar
formulation or reference means (i) that Members will not receive Distributions pursuant to
this Article IV (other than pursuant to Section 4.1(g)) in respect of such Units and (ii) that
such non-participating Value Units held will not be counted in any determination of the
pro rata or proportionate ownership of Units of such Member or any other Member for
purposes of Article IV (other than pursuant to Section 4.1(g)).
(e) Notwithstanding anything to the contrary, only vested Value Units
held by Management Unitholders, Operating Unitholders and Inactive Unitholders shall
participate in any Distributions (other than pursuant to Section 4.1(g)).
(f) Persons Receiving Distributions. Each Distribution shall be made
to the Persons shown on the LLCβs books and records as Unitholders as of the date of such
Distribution; provided, however, that, subject to Article X, any transferor and transferee of
Units may mutually agree as to which of them should receive payment of any Distribution
under this Section 4.1.
(g) Tax Distributions. In the event the LLC allocates net taxable income
to any of the Value Unitholders for any Fiscal Year and to the extent that prior distributions
to such Value Unitholder with respect to such Fiscal Year are not sufficient to satisfy such
Value Unitholderβs tax liability arising as a result of such allocations, then the LLC shall,
subject to the Boardβs determination that there is sufficient cash available for distribution,
make distributions of cash to such Value Unitholders prior to any other distributions
provided for in this Article IV in an amount determined in good faith by the Board for the
purpose of allowing such Value Unitholders to satisfy their tax liability arising as a result
of such allocation. Tax distributions made pursuant to the foregoing shall be treated as
advances against distributions payable to such Value Unitholders pursuant to Section
4.1(a), and shall be taken into account in the calculations of amounts distributed pursuant
to Section 4.1(a).
(h) Distributions In Kind. In the event of a Distribution of LLC
property, such property shall for all purposes of this Agreement be deemed to have been
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sold at its Fair Market Value and the proceeds of such sale shall be deemed to have been
distributed to the Members.
4.2. Allocations. Profits and Losses for any Fiscal Year shall be allocated
among the Unitholders in such a manner that as closely as possible gives economic effect
to the provisions of Section 4.1(a) and the other relevant provisions of this Agreement.
(a) General. Profit and Loss for any Fiscal Year shall be allocated
among the Unitholders in such ratio or ratios as may be required to cause the balances of
the Unitholdersβ Economic Capital Accounts to equal, as nearly as possible, their Target
Balances, consistent with the provisions of Section 4.2(b) and solely for this purpose,
treating all non-vested Units as vested.
(b) Compliance with Code Section 704(b). The allocation provisions
contained in this Article IV are intended to comply with Section 704(b) of the Code and
the Treasury Regulations promulgated thereunder and shall be interpreted and applied in a
manner consistent therewith.
4.3. Tax Allocations. Each item of income, gain, loss or deduction recognized
by the LLC shall be allocated among the Unitholders for U.S. federal, state and local
income tax purposes in the same manner that each such item is allocated to the Unitholdersβ
Capital Accounts or as otherwise provided herein, provided that the Board may adjust such
allocations as long as such adjusted allocations have substantial economic effect or are in
accordance with the interests of the Unitholders in the LLC, in each case within the
meaning of the Code and the Treasury Regulations. Notwithstanding the foregoing, (i)
items of 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, as
determined by the Board in 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 value on the date of contribution and (ii) if the value of any LLC asset
is adjusted pursuant to the requirements of Treasury Regulation Section 1.704-
1(b)(2)(iv)(e) or (f) then 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 such value, as determined
by the Board in the same manner as under Code Section 704(c). The Board shall elect to
use the traditional method described in Treasury Regulation Section 1.704-3(b), unless
each Principal Investor consents to the election of another method. Tax credits and tax
credit recapture shall be allocated in accordance with the Unitholdersβ interests in the LLC
as provided in Treasury Regulations Section 1.704-1(b)(4)(ii). All matters concerning
allocations for U.S. federal, state and local and non-U.S. income tax purposes, including
accounting procedures, not expressly provided for by the terms of this Agreement shall be
determined by the Board in its sole discretion.
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4.4. Indemnification and Reimbursement for Payments on Behalf of a
Unitholder. If the LLC is required by law to make any payment that is specifically
attributable to a Unitholder or a Unitholderβs status as such (including federal withholding
or other taxes, state personal property taxes, and state unincorporated business taxes), then
such Unitholder shall indemnify the LLC in full for the entire amount paid (including
interest, penalties and related expenses). The LLC may pursue and enforce all rights and
remedies it may have against each Unitholder under this Section 4.3, including instituting
a lawsuit to collect such indemnification and contribution with interest calculated at a rate
equal to 10% per annum, compounded as of the last day of each year (but not in excess of
the highest rate per annum permitted by law).
4.5. Transfer of Capital Accounts. If a Unitholder sells, assigns or transfers
an interest in the LLC to a new or existing Unitholder in accordance with the terms herein,
the transferee Unitholder shall succeed to that portion of the transferorβs Capital Account
that is attributable to the sold, assigned or transferred interest. Any reference in this
Agreement to a Capital Contribution of, or Distribution to, a Unitholder that has succeeded
any other Unitholder shall include any Capital Contributions or Distributions previously
made by or to the former Unitholder on account of the interest of such former Unitholder
sold, assigned or transferred to such Unitholder.
4.6. Withholding.
(a) Notwithstanding any other provision of this Agreement, each
Unitholder authorizes the LLC to withhold and to pay over, or otherwise pay, any
withholding or other taxes payable by the LLC or any of its Affiliates (pursuant to the Code
or any provision of the United States Federal, state, local or foreign tax law) attributable to
such Unitholder (including taxes attributable to income or gain allocable to such
Unitholder) or as a result of such Unitholderβs participation in the LLC (a βWithholding
Paymentβ); and if and to the extent that the LLC shall be required to withhold or pay and
actually pays any such Withholding Payment, such Unitholder shall be deemed for all
purposes of this Agreement to have received an interest-free loan from the LLC as of the
time such Withholding Payment is required to be paid notwithstanding the actual date of
payment. Amounts so treated as advanced to any Unitholder shall be repaid by such
Unitholder to the LLC within thirty (30) days after the LLC delivers a written request to
such Unitholder for such repayment; provided, however, that if any such repayment is not
made, the LLC may (without prejudice to any other rights of the LLC) collect such unpaid
amounts from any subsequent LLC distributions that otherwise would be made to such
Unitholder pursuant to Section 4.1 (all such decisions to be made and applied within the
sole discretion of the Board).
(b) If the LLC makes a distribution in kind (if such distribution is
permitted in accordance with the terms of this Agreement) and such distribution is subject
to withholding or other taxes payable by the LLC on behalf of any Unitholder (the
βWithheld Amountβ), the Board shall notify such Unitholder as to the extent (if any) of the
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Withheld Amount and such Unitholder shall make a prompt payment to the LLC of the
Withheld Amount by wire transfer (it being understood that, notwithstanding anything else
herein to the contrary, the LLC shall refrain from distributing such property to be
distributed having a Fair Market Value of at least the Withheld Amount until the LLC has
received a payment of such Withheld Amount).
(c) Any withholding referred to in this Section 4.6 shall be made at the
maximum applicable statutory rate under the applicable tax law unless the Board shall have
received an opinion of counsel or other evidence, satisfactory to the Board, to the effect
that a lower rate is applicable, or that no withholding is applicable.
(d) If the LLC receives a distribution from or in respect of which tax
has been withheld, the LLC shall be treated as having received cash in an amount equal to
the amount of such withheld tax, and each Unitholder shall be treated as having received
as a distribution the portion of such amount that is attributable to such Unitholder.
(e) Each Unitholder shall provide the LLC with any information,
representations, certificates, forms or other documentation relating to such Unitholder (or
its direct or indirect owners or account holders) that are reasonably requested from time to
time by the Board and that the Board determines in its sole discretion are necessary or
appropriate in order for any entity (including (i) the LLC, (ii) any entity in which the LLC
holds (directly or indirectly) an interest (whether in the form of debt or equity), (iii) any
member of any βexpanded affiliated groupβ (as defined in Section 1471(e)(2) of the Code
and the Treasury Regulations thereunder) of which any Person described in clause (i) or
(ii) is a member and (iv) any βRelated Entityβ, as such term is defined in any
intergovernmental agreement referenced in clause (c) of the definition of FATCA) to
(A) avoid any withholding required under FATCA (including, without limitation, any
withholding upon any payments to any person described in clauses (i), (ii) or (iii) or to any
Unitholder under this Agreement), (B) comply with any reporting or withholding
requirements under FATCA, (C) enter into, maintain or comply with an βFFI Agreement,β
as defined in the Code and the Treasury Regulations thereunder (or any other agreement
entered into in connection with FATCA), or (D) otherwise comply with FATCA. In
addition, each Unitholder shall take such actions as the Board may reasonably request in
connection with the foregoing. Any Unitholder that fails to comply with this Section 4.6(e)
shall, together with all other Unitholders that fail to comply with this Section 4.6(e), unless
otherwise agreed by the Board in writing, to the fullest extent permitted by law, indemnify
and hold harmless the Board and the LLC for any costs or expenses arising out of such
failure or failures, including any withholding tax imposed under FATCA. Each Unitholder
acknowledges and agrees that any information or other data in respect of such Unitholder
(or its direct or indirect owners or account holders) provided to the LLC in accordance with
this Section 4.6(e) shall be kept confidential but may, if required by law, be disclosed to
any tax authority.
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(f) Any imputed underpayment within the meaning of Section 6225 of
the Code paid (or payable) by the LLC as a result of an adjustment with respect to any LLC
item, including any interest or penalties with respect to any such adjustment (collectively,
an βImputed Underpayment Amountβ), shall be treated as if it were paid by the LLC as a
Withholding Payment with respect to the appropriate Unitholders. The Board shall
reasonably determine the portion of an Imputed Underpayment Amount attributable to each
Unitholder or former Unitholder. The portion of the Imputed Underpayment Amount that
the Board attributes to a Unitholder shall be treated as a Withholding Payment with respect
to such Unitholder. The portion of the Imputed Underpayment Amount that the Board
attributes to a former Unitholder of the LLC shall be treated as a Withholding Payment
with respect to both such former Unitholder and such former Unitholderβs transferee(s) or
assignee(s), as applicable, and the Board may in its discretion exercise the LLCβs rights
pursuant to this Section 4.6(f) in respect of either or both of the former Unitholder and its
transferee or assignee. Imputed Underpayment Amounts treated as Withholding Payments
also shall include any imputed underpayment within the meaning of Code Section 6225
paid (or payable) by any entity treated as a partnership for U.S. federal income tax purposes
in which the LLC holds (or has held) a direct or indirect interest other than through entities
treated as corporations for U.S. federal income tax purposes to the extent that the LLC
bears the economic burden of such amounts, whether by law or agreement.
(g) If the LLC is obligated to pay any taxes (including penalties, interest
and any addition to tax) to any Governmental Entity that is specifically attributable to a
Unitholder, such Unitholderβs transferee or as a result of any transfer of an interest in the
Company, including, without limitation, on account of Sections 864 or 1446 of the Code,
then (i) such Persons shall indemnify the LLC in full for the entire amount paid or payable,
(ii) the Board may offset future distributions from such Persons pursuant to Section 4.1 to
which such Person is otherwise entitled under this Agreement against such Personβs
obligation to indemnify the LLC under this Section 4.6(g) and (iii) such amounts shall be
treated as a Withholding Payment pursuant to this Section 4.6 with respect to both such
former Unitholder and such former Unitholderβs transferee(s), as applicable.
ARTICLE V
BOARD OF MANAGERS; OFFICERS
5.1. Management by the Board of Managers.
(a) No Management by Unitholders. The Unitholders shall not manage
or control the affairs of the LLC, except as expressly provided in this Agreement with
respect to the Principal Investors (including, for the avoidance of doubt, Section 5.1(b)(iv))
or as required by any non-waivable provisions of applicable law.
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(b) Authority of Board of Managers.
(i) Except as expressly provided in this Agreement with respect
to the Principal Investors (including, for the avoidance of doubt, the provisions of Section
5.1(b)(iv)) or as required by any non-waivable provision of applicable law, (A) the powers
of the LLC shall be exercised by or under the authority of, and the affairs of the LLC shall
be managed under the direction of, the Board and (B) the Board may make all decisions
and take all actions for the LLC not otherwise provided for in this Agreement, including
the following (subject, in each case, to Section 5.1(b)(iv)):
(A) authorizing, designating, reserving for issuance or
issuing any Units or other Equity Securities;
(B) entering into, making and performing contracts,
agreements and other undertakings binding the LLC that may be necessary, appropriate or
advisable in furtherance of the purposes of the LLC and making all decisions and waivers
thereunder;
(C) maintaining the assets of the LLC in good order;
(D) collecting sums due to the LLC;
(E) opening and maintaining bank and investment
accounts and arrangements, drawing checks and other orders for the payment of money
and designating individuals with authority to sign or give instructions with respect to those
accounts and arrangements;
(F) to the extent that funds of the LLC are available
therefor, paying debts and obligations of the LLC as they come due;
(G) acquiring, utilizing for LLC purposes and disposing
of any assets of the LLC;
(H) hiring and employing executives, Officers,
supervisors and other personnel for the Company Group;
(I) selecting, removing and changing the authority and
responsibility of lawyers, accountants and other advisers and consultants;
(J) entering into guaranties on behalf of the LLCβs
Subsidiaries;
(K) obtaining insurance for the LLC;
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(L) determining Distributions of cash and other property
of the LLC as provided in Article IV.
(M) establishing reserves for commitments and
obligations (contingent or otherwise) of the LLC; and
(N) establishing a seal for the LLC.
(ii) The Board may act (A) by resolutions adopted at a meeting
and/or by written consents pursuant to Section 5.3, (B) by delegating power and authority
to committees pursuant to Section 5.4, or (C) by delegating power and authority to any
Officer pursuant to Section 5.5(a).
(iii) Each Unitholder acknowledges and agrees that no Manager
shall, as a result of being a Manager (as such), be bound to devote all of his or her business
time to the affairs of the LLC, and that he or she and his or her Affiliates do and will
continue to engage for their own account and for the accounts of others in other business
ventures.
(iv) Notwithstanding anything in this Agreement to the contrary,
the LLC shall not, and shall cause its Subsidiaries not to, directly or indirectly, take any of
the following actions without the prior approval of the Board and the prior written approval
of each Principal Investor (provided, that the prior approval of a Principal Investor shall
not be required (x) with respect to clauses (A) β (D) (and clauses (T) and (U) to the extent
applicable) if such Principal Investor, together with its Affiliates, collectively holds less
than twenty percent (20%) of such Principal Investorβs Closing Equity and (y) with respect
to clauses (E) β (U) if such Principal Investor, together with its Affiliates, collectively holds
less than fifty percent (50%) of such Principal Investorβs Closing Equity):
(A) amend or repeal any provision of, or supplement, this
Agreement, the Certificate, bylaws or other organizational documents of the LLC or its
Subsidiaries, other than to the extent required in connection with a Qualified IPO to
increase the number of authorized Equity Securities;
(B) enter into any agreement or commitments that would
restrict any Principal Investor or any of its Affiliates from entering into any line of business;
(C) adopt any change to any tax or accounting policy
other than as required by generally accepted accounting principles (βGAAPβ) or applicable
law, or change its independent public accountants, auditors or tax advisors;
(D) enter into any transaction (or amend the terms of any
such transaction) with any Principal Investor or any of its Affiliates other than (i) as
specifically contemplated by this Agreement, (ii) pursuant to any agreements in effect as
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of the date of the Closing (as defined in the Subscription Agreement) and disclosed in the
disclosure schedules thereto or (iii) pursuant to commercial agreements entered into
between an operating business of a Principal Investor or its Affiliates, on the one hand, and
the LLC or any of its Subsidiaries, on the other, in the ordinary course of business and on
armβs length terms;
(E) except in accordance with Section 5.4(a), form, or
delegate any authority to, any committee or subset of the Board or elect any Person to any
such committee or subset of the Board;
(F) make any acquisition or disposition (or any series of
related acquisitions or dispositions) of any entity, business or assets with aggregate
consideration in excess of one-hundred million United States dollars ($100,000,000),
including by way of merger, equity purchase, asset purchase or otherwise;
(G) consummate, commit to or enter into any agreement
or commitment for a Sale of the LLC or any merger or consolidation with a third party
other than (i) an Approved Sale or (ii) with respect to transactions other than a Sale of the
LLC as would be permitted under Section 5.1(b)(iv)(F);
(H) enter into or commit to enter into any material joint
ventures or partnerships, establish or acquire any non-wholly-owned Subsidiaries or merge
or consolidate with, or make investments in, any third party (other than in connection with
a Drag-Along Sale in accordance with Section 10.6), in each case, that involve a cash or
asset contribution (or commitment) in excess of fifty million United States dollars
($50,000,000);
(I) effect an initial Public Offering (other than a
Qualified IPO), or, except in accordance with Section 6.12, grant any registration rights to
any Person;
(J) create, designate, authorize, issue, sell or grant, or
enter into any agreement providing for the issuance (contingent or otherwise) of, any of its
Units or other Equity Securities or any equity appreciation rights, phantom equity plans or
similar rights or plans relating to the LLC or its Subsidiaries, other than (i) the issuance of
any of the foregoing pursuant to a plan approved under Section 5.1(b)(iv)(O) (provided
that, except as approved pursuant to this Section 5.1(b)(iv)(J), for each class of Units
(including, for the avoidance of doubt, Value Units and Common Units), the total number
of Units issued or reserved for issuance under all such management equity plans and other
employee incentive plans shall not exceed the number specified in Schedule B hereto for
such class of Units) and (ii) in a Qualified IPO or an initial Public Offering approved
pursuant to Section 5.1(b)(iv)(I) and effected pursuant to Section 6.12 and the Registration
Rights Agreement;
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(K) authorize, issue, sell or grant, or enter into any
agreement providing for the issuance (contingent or otherwise) of, any of the equity
interests of any Subsidiary to persons other than the LLC or another wholly-owned
Subsidiary of the LLC, other than issuance of equity interests in connection with a Public
Offering approved pursuant to Section 5.1(b)(iv)(I) and effected pursuant to Section 6.12
and the Registration Rights Agreement;
(L) incur or guarantee any Restricted Debt, unless such
incurrence or guarantee would not result in an Excessive Leverage Event as of the date of
incurrence of such Restricted Debt or the effective date of the guarantee of such Restricted
Debt;
(M) develop, construct, operate, acquire ownership of or
otherwise expand into any line of business not conducted by the Company Group as of the
Effective Date which would be competitive with any business conducted by a Principal
Investor or its Affiliates at the time of such action;
(N) (i) select, hire, terminate or remove any person as the
chief executive officer of the Company Group or (ii) amend the terms of any existing
employment agreement or compensation arrangement with, or enter into any new
employment agreement or compensation arrangement with, the chief executive officer of
the Company Group;
(O) adopt, or effect any material changes to, any
management equity plan or other employee incentive plan, including, without limitation,
employee equity (including any change to the number of Value Units issuable under the
Plan or any successor plan), phantom equity or senior management bonus programs, or
issue any capital stock or other securities other than limited liability company units, capital
stock or other securities which it is obligated to issue under the terms of any option existing
as of the Effective Date or issuances to employees, officers or managers under any plan
approved pursuant to this Section 5.1(b)(iv)(O) (it being understood that (i) that the total
number of each class of Units issued or reserved for issuance under all such plans shall not
exceed the amounts permitted under Section 5.1(b)(iv)(J) and (ii) the Plan has been
approved by the Board and each Principal Investor);
(P) determine the terms and conditions governing the
issuance of any Additional Securities, including the number and designation of such
Additional Securities, the preferences (with respect to distributions, liquidations, or
otherwise) over any other Units and relative, participating, optional or other special rights,
powers and duties, including rights, powers and duties senior or junior to, or pari passu
with, any other Units, any required contributions in connection therewith and voting rights;
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(Q) commence or file any bankruptcy, reorganization,
liquidation, insolvency or similar proceeding or commence or consent to the filing of an
involuntary bankruptcy, reorganization, liquidation, insolvency, or similar proceeding;
(R) voluntarily liquidate, dissolve or wind up;
(S) commence, pursue, settle or compromise any
litigation or regulatory proceeding except for (i) any litigation that arises out of the ordinary
course of business and involves solely the payment of monetary damages by the LLC or
any of its Subsidiaries of an amount not exceeding ten million United States dollars
($10,000,000) or (ii) any litigation or disputes relating to a Principal Investorβs investment
in the LLC;
(T) take any other action that requires the consent of
Xxxxxxx or Providence under this Agreement; or
(U) agree or otherwise commit to take any actions set
forth in the foregoing subparagraphs (A) through (T).
(c) Officers. The management of the business and affairs of the LLC
by the Officers and the exercising of their powers shall be conducted under the supervision
of and subject to the approval of the Board.
5.2. Composition and Election of the Board of Managers.
(a) Number and Designation. Unless otherwise agreed by the Principal
Investors:
(i) The number of Managers on the Board shall be established
at seven (7), but may be increased to such higher number or decreased to such lower
number from time to time with the approval of the Principal Investors (subject to Section
5.2(a)(iii) and Section 5.2(a)(iv) below).
(ii) The composition of the Board, as of the date hereof, shall be
as follows:
(A) Xxxxx Xxxxxxxxxx and such other Person designated
by Providence (as and when so designated in accordance with this Section 5.2(a)(ii)(A)),
each of whom has been or will be designated by Providence pursuant to Section 5.2(d)
(each of the foregoing, together with any replacements designated by Providence pursuant
to Section 5.2(d), the βProvidence Managersβ);
(B) Xxx Xxxxxxx, Xxxxx Xxxxxxx and Xxxx Xxxxxxx, each
of whom has been or will be designated by Xxxxxxx pursuant to Section 5.2(d) (each of the
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foregoing, together with any replacements designated by Xxxxxxx pursuant to Section 5.2(d),
the βXxxxxxx Managersβ);
(C) Xxxx Xxxxxx, the chief executive officer of the
Company Group; and
(D) Xxxx Xxxxxxxx, who has been or will be designated
by Principal Investors pursuant to Section 5.2(d) (the foregoing, together with any
replacements designated by Principal Investors pursuant to Section 5.2(d), the
βIndependent Managerβ).
(iii) For so long as a Xxxxxxx, together with its Affiliates,
collectively holds at least 88.88% of its Closing Equity, it shall have the right to designate
three (3) Managers (which shall initially be the Xxxxxxx Managers listed in Section 5.2(a)(ii)
above). For so long as Xxxxxxx, together with its Affiliates, collectively holds at least 44.0%
but less than 88.88% of its Closing Equity, it shall have the right to designate two (2)
Managers. For so long as Xxxxxxx, together with its Affiliates, collectively holds at least
10% but less than 44.0% of its Closing Equity, it shall have the right to designate one (1)
Manager. If Xxxxxxx, together with its Affiliates, holds less than 10% of its Closing Equity,
it shall not have the right to designate any Managers.
(iv) For so long as a Providence, together with its Affiliates,
collectively holds at least 50% of its Closing Equity, it shall have the right to designate two
(2) Managers (which shall initially be the Providence Managers listed in Section 5.2(a)(ii)
above). For so long as Providence, together with its Affiliates, collectively holds at least
10% but less than 50% of its Closing Equity, it shall have the right to designate one (1)
Manager. If Providence, together with its Affiliates, holds less than 10% of its Closing
Equity, it shall not have the right to designate any Managers.
(v) Notwithstanding the foregoing clauses (iii) and (iv) of
Section 5.2(a), for so long as (A) Xxxxxxx, together with its Affiliates, collectively holds
more Units than Providence, together with its Affiliates, Xxxxxxx will be entitled to appoint
at least one more Manager than Providence, and (B) Providence, together with its
Affiliates, collectively holds more Units than Xxxxxxx, together with its Affiliates,
Providence will be entitled to appoint at least one more Manager than Xxxxxxx. Without
limiting the foregoing, in the event that the Principal Investor Ratio equals 4:1 or greater
in favor of any Principal Investor (together with its Affiliates) (the βSubject Principal
Investorβ), then (for so long as such Principal Investor Ratio equals 4:1 or greater in favor
of the Subject Principal Investor) the number of members on the Board shall automatically
(and without any action by any Unitholder or the Board (including pursuant to Section
5.1(b)(iv)) be increased by one (1) and such Subject Principal Investor shall have the right
to designate the Board member (and any replacement thereto) to fill such newly created
Board seat.
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(vi) Notwithstanding the foregoing, such Board designation
rights shall be adjusted proportionately in the event of any increase or decrease in the size
of the Board pursuant to Section 5.2(a)(i). Furthermore, upon the request of either Principal
Investor, the LLC shall cause the boards of directors (or similar governing bodies) and
committees of its Subsidiaries to be comprised of the same persons who are then Managers
of the Board and members of committees of the Board and the voting rights on the boards
of directors (or similar governing bodies) and committees of each of the LLCβs Subsidiaries
to be commensurate with the voting rights of the Principal Investors with respect to the
Board and the committees of the Board.
(vii) The Board shall at all times include the chief executive
officer of the Company Group as a Manager (such Board seat, the βCEO Board Seatβ).
(viii) In the event that the number of Managers a Principal Investor
has the right to designate is reduced pursuant to Section 5.2(a)(iii) or Section 5.2(a)(iv),
(A) such Principal Investor shall promptly identify its incumbent Board designee that will
be removed from the Board in connection with such reduction and (B) the LLC and the
Unitholders shall promptly take all action necessary or desirable to cause the removal of
such incumbent Manager(s) from office.
(ix) Upon an initial Public Offering, the Principal Investors shall
negotiate in good faith mutually agreeable modifications to the governance structure set
forth in this Section 5.2 that they deem appropriate in light of the LLCβs then public status.
(b) Term; Resignation. Members of the Board shall serve from their
designation in accordance with the terms hereof until their resignation, death or removal in
accordance with the terms hereof. Members of the Board need not be Unitholders and need
not be residents of the State of Delaware. A person shall become a member of the Board
effective upon the election or appointment of such person at a meeting of the Unitholders,
or by unanimous written consent. A member of the Board may resign as such by delivering
his, her or its written resignation to the LLC at the LLCβs principal office addressed to the
Board. Such resignation shall be effective upon receipt unless it is specified to be effective
at some other time or upon the happening of some other event.
(c) Removal. Each Principal Investor may, at any time and for any
reason, with or without cause, remove any Manager designated by such Principal Investor
pursuant to Section 5.2(a) or Section 5.2(d) and designate a replacement Manager pursuant
to Section 5.2(d), and the Unitholders and the LLC shall promptly take all action necessary
or desirable to accomplish the foregoing. Upon the removal of any Manager, such Manager
shall cease to be a βmanagerβ (within the meaning of the Delaware Act). No Unitholder
shall take any action to cause the removal of any Manager designated by a Principal
Investor pursuant to Section 5.2(a) or Section 5.2(d) except (i) in connection with the
reduction of the number of Managers such Principal Investor has the right to designate
under Section 5.2(a)(viii) or (ii) at the direction of such Principal Investor.
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(d) Vacancies. In the event that a vacancy on the Board is created or
exists (including by the death, disability, retirement, resignation, removal (with or without
cause) of a Manager or otherwise), (i) if such vacancy relates to the CEO Board Seat, then
such vacancy shall be filled by the highest ranking officer of the Company Group, (ii) if
such vacancy relates to a Board seat previously filled by a Xxxxxxx Manager or Providence
Manager and is not created as a result of a removal pursuant to Section 5.2(a)(viii), then
such vacancy shall be filled by a Person designated by Xxxxxxx or Providence, as applicable,
(iii) if such vacancy is created as a result of a removal pursuant to Section 5.2(a)(viii), then
such vacancy shall remain unfilled and the size of the Board shall be reduced accordingly
unless such Board seat is assigned in accordance with Section 10.7, and (iv) if such vacancy
is created for any other reason, then such vacancy shall be filled by a person designated by
the Principal Investors. The LLC and the Unitholders shall promptly take all action
necessary or desirable to fill any vacancy on the Board in accordance with this Section
5.2(d).
(e) Reimbursement. The LLC shall pay or cause to be paid by one of
its Subsidiaries all reasonable out-of-pocket costs and expenses incurred by each member
of the Board incurred in the course of his or her service hereunder, including in connection
with attending regular and special meetings of the Board, any board of managers or board
of directors of each of the LLCβs Subsidiaries and/or any of their respective committees,
pursuant to reimbursement guidelines approved by each of the Principal Investors.
(f) Reliance by Third Parties. Any Person dealing with the LLC, other
than a Unitholder, may rely on the authority of the Board (or any Officer authorized by the
Board) in taking any action in the name of the LLC without inquiry into the provisions of
this Agreement or compliance herewith, regardless of whether that action actually is taken
in accordance with the provisions of this Agreement. Every agreement, instrument or
document executed by the Board (or any Officer authorized by the Board) in the name of
the LLC with respect to any business or property of the LLC shall be conclusive evidence
in favor of any Person relying thereon or claiming thereunder that (i) at the time of the
execution or delivery thereof, this Agreement was in full force and effect, (ii) such
agreement, instrument or document was duly executed according to this Agreement and is
binding upon the LLC and (iii) the Board or such Officer was duly authorized and
empowered to execute and deliver such agreement, instrument or document for and on
behalf of the LLC.
5.3. Board Meetings and Actions by Written Consent.
(a) Voting. On each matter presented at a meeting of the Board for
action to be taken by the Board on such matter, each Manager present at such meeting shall
be entitled to one vote thereon.
(b) Quorum.
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(i) Managers representing a majority of the total number of
votes on the Board must be present (including pursuant to Section 5.3(h)) in order to
constitute a quorum for the transaction of business of the Board, provided that, subject to
Section 5.2(a), at least one (1) Xxxxxxx Manager and one (1) Providence Manager must be
present at a meeting to constitute a quorum for such meeting, and provided further that one
(1) Xxxxxxx Manager and one (1) Providence Manager (each, a βPrincipal Investor
Managerβ, and collectively the βPrincipal Investor Managersβ) together shall constitute a
quorum for any meeting; provided, however, in the event that a Principal Investor Manager
fails to attend (either in person or by conference telephone or similar communications) two
(2) consecutive meetings of the Board after, in each case, being provided with Requisite
Board Meeting Notice in accordance with Section 5.3(f) (such Manager, an βAbsent
Managerβ), in such case, to the extent that the Absent Manager is provided with at least
three (3) daysβ notice of a third (3rd) consecutive meeting of the Board, the Absent Manager
will be deemed to be in attendance at such third meeting for purposes of establishing a
quorum and taking any actions pursuant thereto (including for establishing a quorum
pursuant to this Section 5.3(b)) whether or not such Absent Manager actually attends such
meeting (a βDeemed Quorumβ).
(ii) Except as otherwise provided in this Agreement (and subject
to clause (i) above), the act of the Managers who are present at a meeting of the Board at
which a quorum is present and who are entitled to exercise a majority of the votes present
at such meeting shall be the act of the Board on any matter presented to the Board for action
to be taken thereon at such meeting. In the event of a tie vote of the Managers who are
present at a meeting of the Board at which a quorum is present (subject to clause (i) above),
a second vote of the Board shall be taken without the participation of the Manager currently
occupying the CEO Board Seat. A Manager who is present at a meeting of the Board at
which action on any matter is taken shall be presumed to have assented to the action unless
his or her dissent shall be entered in the minutes of the meeting or unless he shall file his
or her written dissent to such action with the person acting as secretary of the meeting
before the adjournment thereof or shall deliver such dissent to the LLC immediately after
the adjournment of the meeting. Such right to dissent shall not apply to a Manager who
voted in favor of such action.
(c) Place; Attendance. Meetings of the Board may be held at such place
or places as shall be determined from time to time by resolution of the Board. At all
meetings of the Board, business shall be transacted in such order as shall from time to time
be determined by resolution of the Board. Attendance of a Manager at a meeting shall
constitute a waiver of notice of such meeting, except where a Manager attends a meeting
for the express purpose of objecting to the transaction of any business on the ground that
the meeting is not lawfully called or convened.
(d) Meeting In Connection With Unitholder Meeting. In connection
with any meeting of Unitholders, the Managers may, if a quorum is present (subject to
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Section 5.3(b)(i)), hold a meeting for the transaction of business immediately after and at
the same place as such meeting of the Unitholders. Notice of such meeting at such time
and place shall not be required.
(e) Time, Place and Notice. Regular meetings of the Board shall be
held at such times and places as shall be designated from time to time by resolution of the
Board. Notice of such meetings shall not be required.
(f) Special Meetings. Special meetings of the Board may be called by
any Manager, or the Principal Investors, on at least 24 hoursβ notice to each Manager
(βRequisite Board Meeting Noticeβ). Such notice need not state the purpose or purposes
of, nor the business to be transacted at, such meeting, except as may otherwise be required
by law or provided for in this Agreement.
(g) Chairperson. For so long as Xxxxxxx holds at least 88.88% of its
Closing Equity, Xxxxxxx shall designate one of the then serving Xxxxxxx Managers to serve
as the chairperson of the Board (the βChairpersonβ). The Chairperson shall preside at all
meetings of the Board. If the Chairperson is absent at any meeting of the Board, the
Managers present shall designate a member to serve as interim Chairperson for that
meeting. The Chairperson, except in his or her capacity as an Officer (as applicable), shall
not have the authority or power to act for or on behalf of the LLC, to do any act that would
be binding on the LLC or to make any expenditure or incur any obligation on behalf of the
LLC or authorize any of the foregoing. In the event that Xxxxxxx no longer holds at least
88.88% of its Closing Equity, the position of Chairperson shall be filled by a vote of the
majority of the Board.
(h) Action by Written Consent or Telephone Conference. Any action
permitted or required by the Delaware Act, the Certificate or this Agreement to be taken at
a meeting of the Board or any committee designated by the Board may be taken without a
meeting if a consent in writing, setting forth the action to be taken, is signed by all the
Managers or members of such committee constituting a quorum under Section 5.3(b) or
Section 5.4(a), as the case may be. Such consent shall have the same force and effect as a
vote sufficient to approve such action at a meeting and may be stated as such in any
document or instrument filed with the Secretary of State of Delaware, and the execution of
such consent shall constitute attendance or presence in person at a meeting of the Board or
any such committee, as the case may be, provided, however, that the Unitholders may
record their dissent to any such action. Subject to the requirements of the Delaware Act,
the Certificate or this Agreement for notice of meetings, unless otherwise restricted by the
Certificate, the Managers or members of any committee designated by the Board may
participate in and hold a meeting of the Board or any committee, as the case may be, by
means of a conference telephone or similar communications equipment by means of which
all persons participating in the meeting can hear each other, and participation in such
meeting shall constitute attendance and presence in person at such meeting, except where
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a person participates in the meeting for the express purpose of objecting to the transaction
of any business on the ground that the meeting is not lawfully called or convened.
(i) Non-Voting Board Observers. Each Principal Investor shall be
entitled to designate up to two non-voting observers affiliated with such Principal Investor
(i.e. an officer, employee or partner of such Principal Investor or its Affiliates) (each a
βBoard Observerβ) to be present at all meetings of the Board and its committees. Each
Board Observer shall be entitled to notice of meetings of the Board and its committees to
the same extent, and in the same manner, as the Managers. Notwithstanding the foregoing,
(i) each Board Observer agrees to hold all information so provided to such Board Observer
in accordance with Section 15.2 of this Agreement, and such Board Observer shall not
disclose any such information to any other Person other than in accordance with Section
15.2 of this Agreement and (ii) the Board reserves the right to withhold any information
from any Board Observer and to exclude any Board Observer from any meeting or portion
thereof (A) if the Board determines that providing such Board Observer with access to such
information or permitting such Board Observer to attend such meeting would adversely
affect the attorney-client privilege between the LLC and its counsel or would result in
disclosure of trade secrets to such Board Observer, (B) if the Board determines that the
individual designated as a Board Observer is a Competitor of the LLC or any of its
Subsidiaries, or is employed by, manages, advises, consults with, owns, or serves as a
member of the board of directors of, a Competitor of the LLC or any of its Subsidiaries, or
(C) to the extent the Board determines that delivery of such information would result in a
breach of any laws, rules or regulations, including any healthcare regulations. The decision
of the Board with respect to the privileged nature of such information or the exclusion of a
Board Observer from any meeting shall be final and binding.
5.4. Committees; Delegation of Authority and Duties.
(a) Committees; Generally. The Board shall promptly establish (i) an
audit committee, (ii) a compliance committee and (iii) a compensation committee, and
subject to the requirements of applicable Law or the regulations of any self-regulatory
organization, each of Xxxxxxx and Providence shall be entitled to appoint a number of
members of each committee of the Board that is proportional to the number of Managers
that such Person is entitled to designate at the relevant time pursuant to Section 5.2(a)
(subject to all applicable provisions of Section 5.2(a), applied mutatis mutandis); provided,
that Providence shall be entitled to appoint at least one member to each committee for so
long as Providence is entitled to designate a Manager pursuant to Section 5.2(a). Any of
the foregoing committees, to the extent provided in the enabling resolution or in the
Certificate or this Agreement, shall have and may exercise, to the extent provided in a
resolution of the Board or in this Agreement, the authority of the Board. At every meeting
of any of the foregoing committees, the presence of a majority of all the members thereof
shall constitute a quorum (provided that at least one (1) Xxxxxxx Manager and one (1)
Providence Manager must be present at a meeting to constitute a quorum for a meeting of
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any committee that includes a Xxxxxxx Manager or a Providence Manager, as applicable, as
a committee member and subject to all applicable provisions of Section 5.3(b) relating to
a Deemed Quorum, applied mutatis mutandis). Minutes of all meetings of any committee
of the Board shall be kept by the person designated by such committee to keep such
minutes. Copies of such minutes and any writing setting forth an action taken by written
consent without a meeting shall be distributed to each member of the Board promptly after
such meeting is held or such action is taken. On each matter presented at a meeting of any
such committee for action to be taken on such matter, each Manager on such committee
shall be entitled to one vote. Except as otherwise provided in this Agreement, the
affirmative vote of the members of a committee who are present at a meeting of such
committee (at which a quorum is present) and who hold a majority of the votes present at
such meeting shall be the act of the committee on any matter presented to the committee
for action to be taken thereon at such meeting.
(b) Delegation; Generally. Subject to the terms and conditions of this
Agreement (including, for the avoidance of doubt, Section 5.1(b)(iv)), the Board may, from
time to time, delegate to one or more Persons (including any Manager or Officer) such
authority and duties as the Board may deem advisable in addition to those powers and
duties set forth in Section 5.1(b) hereof. Subject to the terms and conditions of this
Agreement, the Board also may assign titles to any Manager or other individual and may
delegate to such Manager or other individual certain authority and duties. Any number of
titles may be held by the same Manager or other individual. Subject to the terms and
conditions of this Agreement, any delegation pursuant to this Section 5.4(b) may be
revoked at any time by the Board.
(c) Third-party Reliance. Any Person dealing with the LLC, other than
a Unitholder, may rely on the authority of any Officer in taking any action in the name of
the LLC without inquiry into the provisions of this Agreement or compliance herewith,
regardless of whether that action actually is taken in accordance with the provisions of this
Agreement.
5.5. Officers.
(a) Designation and Appointment. Subject to Section 5.1(b)(iv), the
Board shall designate and appoint a chief executive officer of the LLC and may (but need
not), from time to time, designate and appoint one or more additional persons as an Officer
of the LLC. No Officer need be a resident of the State of Delaware, a Unitholder or a
Manager. Any Officers so designated shall have such authority and perform such duties
as the Board may, from time to time, delegate to them. The Board may assign titles to
particular Officers. Unless the Board otherwise decides, if the title is one commonly used
for officers of a business corporation formed, the assignment of such title shall constitute
the delegation to such Officer of the authority and duties that are normally associated with
that office, subject to (i) any specific delegation of authority and duties made to such
Officer by the Board pursuant to the third sentence of this Section 5.5(a) or (ii) any
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delegation of authority and duties made to one or more Officers pursuant to the terms of
Section 5.4(b). Each Officer shall hold office until such Officerβs successor shall be duly
designated and shall qualify or until such Officerβs death or until such Officer shall resign
or shall have been removed in the manner hereinafter provided. Any number of offices
may be held by the same individual. Subject to Section 5.1(b)(iv), the salaries or other
compensation, if any, of the Officers and agents of the Company Group shall be fixed from
time to time by the Board.
(b) Resignation; Removal. Any Officer (subject to any contract rights
available to the Company Group, if applicable) may resign as such at any time. Such
resignation shall be made in writing and shall take effect at the time specified therein, or if
no time be specified, at the time of its receipt by the Board. The acceptance of a resignation
shall not be necessary to make it effective, unless expressly so provided in the resignation.
Any Officer may be removed as such, either with or without cause, by the Board in its
discretion at any time. Subject to Section 5.1(b)(iv), any vacancy occurring with respect
to any Officer position of the LLC may be filled by the Board.
ARTICLE VI
GENERAL RIGHTS AND OBLIGATIONS OF UNITHOLDERS
6.1. Limitation of Liability. Except as otherwise provided by applicable law,
the debts, obligations, and liabilities of the LLC, whether arising in contract, tort, or
otherwise, shall be solely the debts, obligations, and liabilities of the LLC, and no
Unitholder shall be obligated personally for any such debt, obligation, or liability of the
LLC solely by reason of being a Unitholder of the LLC; provided that a Unitholder shall
be required to return to the LLC any Distribution made to it in clear and manifest
accounting or similar error. The immediately preceding sentence shall constitute a
compromise to which all Unitholders have consented within the meaning of the Delaware
Act. Notwithstanding anything contained herein to the contrary, the failure of the LLC to
observe any formalities or requirements relating to the exercise of its powers or
management of its business and affairs under this Agreement or the Delaware Act shall not
be grounds for imposing personal liability on the Unitholders for liabilities of the LLC.
6.2. Lack of Authority. No Unitholder in his, her, or its capacity as such (other
than the members of the Board acting as the Board or an authorized Officer of the LLC)
has the authority or power to act for or on behalf of the LLC in any manner, to do any act
that would be (or could be construed as) binding on the LLC or to make any expenditures
on behalf of the LLC, and, subject to Section 5.1(b)(iv), the Unitholders hereby consent to
the exercise by the Board of the powers conferred on it by law and this Agreement.
6.3. No Right of Partition. No Unitholder shall have the right to seek or obtain
partition by court decree or operation of law of any LLC property, or the right to own or
use particular or individual assets of the LLC.
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6.4. Unitholders Right to Act. For situations which the approval of any
Unitholders (rather than the approval of the Board) is required, the Unitholders shall act
through meetings and written consents as described in Article III and/or Section 15.3.
6.5. Right to Information.
(a) The LLC shall deliver to each Information Recipient (unless
otherwise waived by the Principal Investors on behalf of all such Information Recipients):
(i) financial reports distributed by the Board from time to time
in its sole discretion generally to all holders of Units;
(ii) upon the reasonable request of an Information Recipient, a
current capitalization table reflecting the ownership of all holders of Units; provided, that
the LLC shall only provide Information Recipients that are not Principal Investors with
such capitalization information on an aggregated basis;
(iii) quarterly materials distributed to the Board; provided, that
the LLC shall be entitled to withhold and/or redact such materials to the extent providing
such materials would (i) be reasonably likely to adversely affect the attorney-client
privilege between the LLC and its counsel, (ii) be reasonably likely to adversely affect the
LLC or its Affiliates under governmental regulations or other applicable laws, (iii) be in
contravention of any agreement or arrangement requiring such information to be kept
confidential, (iv) result in a conflict of interest or (v) otherwise be inappropriate to provide,
as reasonably determined by the Board; and
(iv) such other information and data (including such information
and reports made available to any lender of the LLC or any of its Subsidiaries under any
credit agreement or otherwise) with respect to the LLC and each of its Subsidiaries as may
be necessary for such Information Recipient to comply with its respective reporting,
regulatory, or other legal requirements and as may from time to time be reasonably
requested by any such Information Recipient.
(b) The LLC shall deliver to the Ekbatani Holder (for so long as the
Ekbatani Holder owns three percent (3%) or more of the LLCβs outstanding Common
Units):
(i) Annual Financial Statements: within seventy-five (75) calendar
days from the LLCβs fiscal year end;
(ii) Quarterly Financial Statements: within thirty (30) calendar days
from the end of the LLCβs fiscal quarter end;
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(iii) A current capitalization table reflecting the ownership of all holders
of Units on an aggregated basis: annually, commencing on the date hereof, and
thereafter within thirty (30) calendar days of each subsequent anniversary of the
date hereof (such date, the βCap Table Delivery Dateβ), unless prior to such Cap
Table Delivery Date the ownership percentage of any Unitholder in the LLC
changes (negatively or positively) by ten percent (10%) or more, in which case
within thirty (30) calendar days of such change.
6.6. Public Filing Information Rights.
(a) Information. The LLC shall provide, and Xxxxxxx and the other
Unitholders shall use their reasonable best efforts to cause the LLC to provide, to
Providence (including its agents, accountants, advisors, counsel and other representatives)
any information with respect to the LLC that Providence reasonably requests in connection
with Providence Parentβs Reports, or that, in the reasonable judgment of Providence, is
required to be disclosed or incorporated by reference therein, under any applicable law,
rule or regulation, including, but not limited to, the following (collectively, the
βInformationβ):
(i) audited consolidated balance sheet of the LLC at the end of each
fiscal year, and the related audited statements of income, statements of
stockholdersβ equity and statements of cash flows, which financial statements will
set forth in comparative form such figures at the end of and for the previous fiscal
year (other than fiscal year 2015), together with all related notes and schedules
thereto, together with an opinion of the LLCβs independent auditor (such
information, βAnnual Financial Statementsβ);
(ii) consolidated balance sheet of the LLC at the end of each of the four
quarters of each fiscal year, and the related statements of income, statements of
stockholdersβ equity and statements of cash flows, which financial statements will
set forth in comparative form such figures at the end of and for such quarter and
year to date periods in the previous fiscal year, together with all related notes and
schedules thereto, as reviewed (if such review is requested by Providence, at
Providenceβs sole cost and expense) by the LLCβs independent auditor (such
information, βQuarterly Financial Statementsβ);
(iii) a monthly financial reporting package that includes substantially the
same information that was provided by the Company Sub to Providence each month
prior to the Effective Date, including a consolidated balance sheet, statement of
income (month-end, quarter-end and year-to-date), statement of cash flows and
trial balance (such information, βMonthly Financial Informationβ);
(iv) copies of any annual and other budgets and financial projections
relating to the LLC;
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(v) all significant deficiencies or material weaknesses in the design or
operation of internal controls, any fraud that involves management or other
employees of the LLC who have a significant role in the LLCβs internal control
over financial reporting, and any illegal act within the meaning of Section 10A(b)
and (f) of the Securities Exchange Act (such information, a βDeficiencyβ);
(vi) any development involving a prospective material change, in or
affecting the general affairs, management, financial position, stockholdersβ equity
or results of operations of the LLC (such information, a βMaterial Changeβ); and
(vii) any additional financial and other information and data with respect
to the LLC and its business, properties, financial position, results of operations and
prospects.
(b) Timing and Delivery of Information. The LLC will provide, and
Xxxxxxx will use its reasonable best efforts to cause the LLC to provide, to Providence
(including its agents, accountants, advisors, counsel and other representatives) the
Information in a timely manner on the dates requested by Providence (but in any case, with
respect to information in the possession of or that can be determined or calculated in a
reasonable timeframe by, the LLC or its Subsidiaries, within five (5) business days of any
request). For the avoidance of doubt, the following Information will be provided to
Providence by no later than the following deadlines (the βFiling Scheduleβ):
(i) Annual Financial Statements: within seventy-five (75) calendar
days from the LLCβs fiscal year end (unless such Annual Financial Statements are
required at an earlier date pursuant to requirements under Regulation SX 3-09
promulgated under the Securities Exchange Act or other applicable legal
requirement);
(ii) Quarterly Financial Statements: within thirty (30) calendar days
from the end of the LLCβs fiscal quarter end;
(iii) Monthly Financial Information: within ten (10) Business Days
following each month-end; and
(iv) Any Material Change or Deficiency: promptly after any Officer of
the LLC or any member of the Board becomes aware of such matter.
(c) Independent Auditor. The LLC will use commercially reasonable
efforts to cause its independent auditor to provide to Providence all necessary Information
in a timely manner pursuant to Section 6.6(b).
(d) Information Standard. The LLC will use commercially reasonable
efforts to cause its Quarterly Financial Statements and Annual Financial Statements to be
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prepared in accordance with GAAP and to cause such financial information to fairly
present, in all material respects, the financial position and results of operations of the LLC
as of the dates, and for the periods, covered. The LLC will use commercially reasonable
efforts to cause its agents to not publicly disclose or announce information concerning the
LLC that could be reasonably expected to cause the information presented in any of
Providence Parentβs Reports to be untrue or incomplete in any material respect. In
furtherance of the foregoing, the LLC shall not share any material, non-public information
concerning the LLC with any Person who is not bound by an obligation of confidentiality
to the LLC with respect to such information. Neither the LLC nor Xxxxxxx or any other
Unitholder will provide any Information to Providence (including its agents, accountants,
advisors, counsel and other representatives) that contains an untrue statement of a material
fact, or omits to state a material fact necessary to make such information not misleading.
(e) Access and Cooperation. As requested by Providence and necessary
to comply with Providence Parentβs disclosure obligations, the LLC will use commercially
reasonable efforts to make its Managers and officers having responsibility for its financial
reporting and business areas that relate to the matters included in the Information, and its
agents, accountants, advisors, counsel and other representatives, reasonably available to
Providence (and its agents, accountants, advisors, counsel and other representatives) at
reasonable times and places for (i) consultations and discussions regarding the Information
to be included in the Reports and (ii) Providence Parentβs presentations to securities
analysts and at industry trade meetings and conferences, unless the LLC reasonably
determines that they should not be made available for such purposes. Additionally, the
LLC will use commercially reasonable efforts to cause its independent auditor to (x)
perform an audit of the Annual Financial Statements and review of the Quarterly Financial
Statements and provide the results thereof to Providence and the independent auditor of
Providence Parent in accordance with the Filing Schedule, (y) provide the necessary
consents required under the securities laws and (z) provide customary βcomfort lettersβ in
connection with any offerings of Providence Parent securities (with respect to clause (z)
and to the review of the Quarterly Financial Statements pursuant to clause (x) if such
review is requested by Providence, at Providenceβs sole cost and expense). Providence
will have the right to access such records of the LLC at reasonable times and during normal
business hours and will be permitted to make abstracts from, or copies of, such records.
(f) Disclosure Controls. The LLC agrees that it will maintain internal
systems and procedures that will provide reasonable assurance that (i) the LLCβs
consolidated financial statements are reliable and timely prepared in accordance with
GAAP and applicable law, (ii) all transactions are recorded as necessary to permit the
preparation of the LLCβs consolidated financial statements in accordance with GAAP and
applicable law, (iii) the receipts and expenditures of the LLC are authorized at the
appropriate level within the LLC and (iv) unauthorized use or disposition of the assets of
the LLC that could have a material effect on the LLCβs consolidated financial statements
is prevented or detected in a timely manner.
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(g) Miscellaneous. Each of the LLC, Xxxxxxx and Providence shall be
responsible for its own fees, costs and expenses paid or incurred in connection with the
preparation of Information and compliance with the terms of this Section 6.6, including
fees, costs and expenses of such partyβs agents, accountants, advisors, counsel and other
representatives. The LLC will indemnify Providence and its Affiliates and all of its and
their respective partners, equityholders, officers, directors, employees and agents for any
losses, damages, liabilities, claims, demands, judgments, penalties or fines arising out of
or relating to the performance of the LLC of its obligations under this Section 6.6.
6.7. Non-Competition. No Unitholder (other than current or former Principal
Investors and any Managers that are not employees of the Company Group) shall, during
the period of time that he, she or it owns Units in the LLC and for one year following the
sale or Permitted Transfer thereof (the βRestricted Periodβ), directly or indirectly, within
or with respect to any country where the Company Group does business, engage, without
the prior express written consent of the LLC, in any business or activity, whether as an
employee, consultant, partner, principal, agent, representative, director, equityholder or in
any other individual, corporate or representative capacity, or render any services or provide
any advice to any business, activity, service, person or entity, if such business, activity,
service, person or entity, competes with the Business (a βCompeting Businessβ). For
purposes of this Section 6.7 only, the term βBusinessβ shall mean the business of
contracting with health plans to provide in-home care to Commercial, Managed Medicaid
and Medicare Advantage members or other like services as the Company Group or in any
other business engaged in by the Company Group or any potential business which has been
submitted to the Board for consideration and is under consideration by the Board. In
addition, no Unitholder (other than current or former Principal Investors) shall, during the
Restricted Period, meaningfully assist, help or otherwise support, without the prior express
written consent of the LLC, any Person or activity, whether as an employee, consultant,
partner, principal, agent, representative, director, stockholder or in any other individual,
corporate or representative capacity, to create, commence or otherwise initiate, or to
develop, enhance or otherwise further, any business or activity if such business or activity
competes (or is reasonably likely to compete) with the Business. Notwithstanding the
foregoing, no Unitholder shall be prohibited during the Restricted Period from being a
passive investor where the Unitholder owns not more than two percent (2%) of the
outstanding capital stock of any publicly-held company. Notwithstanding the foregoing,
this Section 6.7 shall not apply to the Principal Investors.
6.8. Non-Solicitation. During the Restricted Period, no Unitholder shall induce
any Person in the senior management role at the Company Group to (i) terminate such
employment or (ii) accept employment, or enter into any consulting arrangement, with any
Person other than a member of the Company Group.
6.9. Statements by the Unitholder. Unless required by applicable law, rule or
regulation or any recognized subpoena power, no Unitholder (other than the Principal
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Investors and any former Principal Investor not controlled by a Competitor) shall at any
time make any statement or representation, written or oral, which such Unitholder (other
than the Principal Investors and any former Principal Investor not controlled by a
Competitor) knows or should know will, or which such Unitholder (other than current or
former Principal Investors) knows or should know is reasonably likely to, impair or
adversely affect in any way the reputation, goodwill, business, customer or supplier
relationships, or public relations of the Company Group, and/or any of their respective
partners, directors, employees or officers; provided that a former Principal Investor
controlled by a Competitor shall not be prohibited from engaging in ordinary course
business activities. In the event that any Unitholder (other than the Principal Investors and
any former Principal Investor not controlled by a Competitor) becomes legally compelled
(by oral questions, interrogatories, request for information or documents, subpoena,
criminal or civil investigative demand or similar process) to make any such statements or
representations, then prior thereto and to the extent permitted by law, the Unitholder will
provide the LLC with prompt written notice so that the LLC may seek (with such
Unitholderβs cooperation) a protective order or other appropriate remedy and/or waive
compliance with the provisions of this Section 6.9. In the event that such protective order
or other remedy is not obtained, then the applicable Unitholder will only make such
statements or representations which the Unitholder is advised by counsel are legally
required, and will cooperate with the LLC in the LLCβs efforts to obtain reliable assurance
that confidential treatment will be accorded to any such statements or representations.
Notwithstanding the foregoing, this Section 6.9 shall not apply to the Principal Investors.
6.10. Publicity. Each Unitholder shall, subject to provisions of this Section 6.10,
consult with and obtain the approval of each of the Principal Investors before issuing any
press release or other public announcement with respect to this Agreement or the matters
contemplated hereby, and no such Unitholder shall issue or cause to be issued any such
press release prior to such consultation and approval, except to the extent required or
appropriate in connection with applicable law, rule, regulation, governmental body or stock
exchange (including regulatory and self-regulatory bodies), in which case the Unitholder
proposing to issue such press release or make such public announcement shall use
commercially reasonable efforts to consult in good faith with the Principal Investors to the
extent practicable before issuing any such press release or making any such public
announcement and allow the other party reasonable time (taking into account the
circumstances, including exigent circumstances) to comment on, such release or
announcement in advance of such issuance, and the party will consider such comments in
good faith (the βConsultation Rightsβ). For the avoidance of doubt, this Section 6.10 shall
not prohibit Providence from issuing any Reports or filing this Agreement with the
Securities and Exchange Commission, or otherwise limit the rights of the Principal
Investors to disclose information to the extent permitted by Section 15.2, in each case, in
compliance with this Section 6.10 (including the Consultation Rights set forth herein) and
Section 15.2.
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6.11. Transactions Between the LLC and the Unitholders.
(a) Except as specifically set forth herein, without the approval of the
Board and without limiting Section 5.1(b)(iv), the LLC shall not, and shall cause its
Subsidiaries not to, directly or indirectly, enter into or commit to enter into any transaction
with any Unitholder or any of its Affiliates, other than (i) this Agreement and the Advisory
Agreement, subject to the provisions herein and therein regarding amendment, termination
or waiver under any such agreements, (ii) any transaction specifically contemplated by this
Agreement, (iii) any agreements or arrangements with employees of the LLC or its
Subsidiaries, subject to Section 5.1(b)(iv), or (iv) any transaction between the LLC or any
of its Subsidiaries, on the one hand, and an operating business of any of the Principal
Investors or any of their respective Affiliates, on the other hand, which is on armsβ length
terms and in the ordinary course of business. Notwithstanding any other provision hereof,
no Unitholder may purchase, assume, or otherwise acquire any indebtedness of the LLC or
its Subsidiaries (or any participations related thereto) without receiving the written
approval of each Principal Investor.
(b) Except as specifically set forth herein, without the approval of the
Ekbatani Holder and without limiting Section 5.1(b)(iv), the LLC shall not, and shall cause
its Subsidiaries not to, directly or indirectly, enter into or commit to enter into any
agreements or arrangements with the Principal Investors or any of their respective
Affiliates that obligate the LLC or any of its Subsidiaries to pay any management or other
fees or payments of any kind to the Principal Investors or any of their respective Affiliates,
other than this Agreement and the Advisory Agreement (which Advisory Agreement may
not be amended to alter the aggregate economics contemplated therein following the date
hereof without the prior written consent of the Ekbatani Holder).
6.12. Initial Public Offering; Registration Rights Agreement. Prior to the
commencement of any initial Public Offering (i), the Board shall form a committee
comprised of one representative of each of the Principal Investors which shall be
responsible for facilitating coordination among the Unitholders with respect to sell-down
activities and (ii) the LLC or its applicable Subsidiary and the Unitholders shall enter into
a Registration Rights Agreement on customary terms negotiated in good faith by the
Principal Investors consistent with those forth in Exhibit A (the βRegistration Rights
Agreementβ).
6.13. Interests in Providence. Xxxxxxx Healthcare Partners (βXxxxxxx Partnersβ)
shall not, and shall cause its controlled Affiliates not to, without the prior written consent
of Providence, for so long as Mercury Fortuna Buyer, LLC or any of its Affiliates is a
Unitholder, directly or indirectly, acquire ownership (including as a beneficial owner) of
any securities or indebtedness of Providence Parent or its Subsidiaries, or any options or
other rights to acquire any such ownership from a third party or otherwise, or participate
in or encourage the formation of any group that owns or seeks or offers to acquire beneficial
ownership of any securities or indebtedness of Providence Parent or its Subsidiaries;
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provided that (i) Xxxxxxx Partners and its Affiliates and their respective personnel may own
up to 1% of such securities or indebtedness in the aggregate as passive investments and (ii)
for the avoidance of doubt, the restrictions set forth in this Section 6.13 shall not apply,
directly or indirectly, to any equityholders of Mercury Fortuna Buyer, LLC or any of its
Affiliates to the extent that such equityholders are not Affiliated with Xxxxxxx Partners.
ARTICLE VII
EXCULPATION AND INDEMNIFICATION
7.1. Exculpation. No Manager or Tax Matters Partner shall be liable to any
Officer, Manager, the LLC or to any Unitholder for any loss suffered by the LLC unless
such loss is caused by such Personβs gross negligence, willful misconduct or violation of
law. The Managers and Tax Matters Partner shall not be liable for errors in judgment or
for any acts or omissions that do not constitute gross negligence, willful misconduct or
violation of law. Any Manager or Tax Matters Partner may consult with counsel and
accountants in respect of LLC affairs, and provided such Person acts in good faith reliance
upon the advice or opinion of such counsel or accountants, such Person shall not be liable
for any loss suffered by the LLC in reliance thereon.
7.2. Right to Indemnification. Subject to the limitations and conditions as
provided in this Article VII, each Person who was or is made a party or is threatened to be
made a party to or is involved in any threatened, pending or completed action, suit, claim,
litigation or proceeding, whether civil, criminal, administrative, arbitrative (hereinafter a
βProceedingβ), or any appeal in such a Proceeding or any inquiry or investigation that could
lead to such a Proceeding, by reason of the fact that he or she, or a Person of whom he or
she is the legal representative, is or was a Unitholder, Manager, Tax Matters Partner or
Officer, or while a Unitholder, Manager, Tax Matters Partner or Officer is or was serving
at the request of the LLC as a manager, director, officer, partner, venturer, proprietor,
trustee, employee, agent or similar functionary of another foreign or domestic limited
liability company, corporation, partnership, joint venture, sole proprietorship, trust,
employee benefit plan or other enterprise shall be indemnified by the LLC to the fullest
extent permitted by the Delaware Act, as the same exist or may hereafter be amended (but,
in the case of any such amendment, only to the extent that such amendment permits the
LLC to provide broader indemnification rights than said law permitted the LLC to provide
prior to such amendment) against losses, damages, liabilities, claims, demands, judgments,
penalties (including excise and similar taxes and punitive damages), fines, settlements and
reasonable expenses (including attorneysβ fees and costs of investigating the facts related
to such Proceeding and preparing for participation therein) actually incurred by such
Person as a result of, arising out of or in connection with such Proceeding, and
indemnification under this Article VII shall continue as to a Person who has ceased to serve
in the capacity which initially entitled such Person to indemnity hereunder; provided,
however, that such Person shall not be entitled to indemnification hereunder to the extent
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that any of the foregoing is determined by a final, nonappealable order of a court of
competent jurisdiction to have been primarily caused by the gross negligence, bad faith or
willful misconduct or criminal activity (evidenced by a final, nonappealable felony
conviction) of such Person. The rights granted pursuant to this Article VII shall be deemed
contract rights, and no amendment, modification or repeal of this Article VII shall have the
effect of limiting or denying any such rights with respect to actions taken or Proceedings
arising prior to, on or after any such amendment, modification or repeal. It is expressly
acknowledged that the indemnification provided in this Article VII could involve
indemnification for negligence or under theories of strict liability.
7.3. Advance Payment. Reasonable expenses incurred by a Person of the type
entitled to be indemnified under Section 7.2 who was, is or is threatened to be made a
named defendant or respondent in a Proceeding shall be paid by the LLC in advance of the
final disposition of the Proceeding upon receipt of an undertaking by or on behalf of such
Person to repay promptly such amount if it shall ultimately be determined that he or she is
not entitled to be indemnified by the LLC.
7.4. Indemnification of Employees and Agents. The LLC, by adoption of a
resolution of the Board, may indemnify and advance expenses to an employee or agent of
the LLC or its Subsidiaries to the same extent and subject to the same conditions under
which it may indemnify and advance expenses to Persons who are not or were not
Managers, Tax Matters Partner or Officers but who are or were serving at the request of
the LLC as a manager, director, officer, partner, venturer, proprietor, trustee, employee,
agent or similar functionary of another foreign or domestic limited liability company,
corporation, partnership, joint venture, sole proprietorship, trust, employee benefit plan or
other enterprise against any liability asserted against him and incurred by him in such a
capacity or arising out of his or her status as such a Person to the same extent that it may
indemnify and advance expenses to Managers, the Tax Matters Partner and Officers under
this Article VII.
7.5. Appearance as a Witness. Notwithstanding any other provision of this
Article VII, the LLC shall pay or reimburse reasonable out-of-pocket expenses incurred by
a Manager, Tax Matters Partner or Officer in connection with his or her appearance as a
witness or other participation in a Proceeding at a time when he is not a named defendant
or respondent in the Proceeding.
7.6. Nonexclusivity of Rights. The right to indemnification and the
advancement and payment of expenses conferred in this Article VII shall not be exclusive
of any other right which a Manager, Tax Matters Partner, Officer or other Person
indemnified pursuant to Section 7.2 may have or hereafter acquire (i) under any law
(common or statutory), (ii) under any provision of the Certificate or this Agreement, (iii)
pursuant to the Advisory Agreement or (iv) by vote of Unitholders or disinterested
Managers or otherwise.
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7.7. Insurance. The LLC shall purchase and maintain insurance in the amount
and of the type customarily obtained for companies comparable to the LLC and its
Subsidiaries, at its expense, to protect itself and any Person who is or was serving as a
Manager, Tax Matters Partner, Officer or agent of the LLC or is or was serving at the
request of the LLC as a manager, director, officer, partner, venturer, proprietor, trustee,
employee, agent or similar functionary of another foreign or domestic limited liability
company, corporation, partnership, joint venture, sole proprietorship, trust, employee
benefit plan or other enterprise against any expense, liability or loss, whether or not the
LLC would have the power to indemnify such Person against such expense, liability or loss
under this Article VII.
7.8. Savings Clause. If this Article VII or any portion hereof shall be
invalidated on any ground by any court of competent jurisdiction, then the LLC shall
nevertheless indemnify and hold harmless each Manager, Tax Matters Partner, Officer or
any other Person indemnified pursuant to this Article VII as to costs, charges and expenses
(including attorneysβ fees), judgments, fines and amounts paid in settlement with respect
to any action, suit or proceeding, whether civil, criminal, administrative or investigative to
the full extent permitted by any applicable portion of this Article VII that shall not have
been invalidated and to the fullest extent permitted by applicable law.
7.9. Certain Dealings and Opportunities. Each Unitholder acknowledges and
agrees that: (a) each current or former Principal Investor, their respective Affiliates and
their respective stockholders, directors, officers, controlling Persons, partners, members,
and employees (collectively, the βInvestor Groupβ) (i) have or may have investments or
other business relationships with entities engaged in other businesses (including those
which may compete with the business of the LLC and any of its Subsidiaries or areas in
which the LLC or any of its Subsidiaries may in the future engage in business) and in
related businesses other than through the LLC or any of its Subsidiaries, (ii) may develop
a strategic relationship with businesses that are or may be competitive with the LLC or any
of its Subsidiaries and (iii) will not be prohibited by virtue of their direct or indirect
investment in the LLC or its Subsidiaries, or their service on the Board or any Subsidiaryβs
board of directors (or similar governing body), or for any other reason, from pursuing and
engaging in any such activities; (b) neither the LLC or any of its Subsidiaries nor any other
Unitholder shall have any right or expectation in or to such other ventures or activities or
to the income or proceeds derived therefrom; and (c) no member of the Investor Group
shall be obligated to present any particular investment or business opportunity to the LLC
or any of its Subsidiaries even if such opportunity is of a character which, if presented to
the LLC, could be undertaken by the LLC or any of its Subsidiaries, and each member of
the Investor Group shall have the right to undertake any such opportunity for itself for its
own account or on behalf of another or to recommend any such opportunity to other
Persons. Each of the LLC and the Unitholders hereby waives, to the fullest extent
permitted by applicable law, any claims and rights that such Person may otherwise have in
connection with the matters described in this Section 7.9. Notwithstanding anything to the
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contrary in this Section 7.9, the rights of the Investor Group under this Section 7.9 shall be
subject to the confidentiality obligations set forth in Section 15.2.
ARTICLE VIII
BOOKS, RECORDS, ACCOUNTING AND REPORTS
8.1. Records and Accounting. The LLC shall keep, or cause to be kept,
appropriate books and records with respect to the LLCβs affairs, including all books and
records necessary to provide any information, lists, and copies of documents required to be
provided pursuant to Section 8.3 or pursuant to applicable laws. All matters concerning (i)
the determination of the relative amount of allocations and distributions among the
Unitholders pursuant to Articles III and IV and (ii) accounting procedures and
determinations, and other determinations not specifically and expressly provided for by the
terms of this Agreement, shall be determined by the Board (subject to Section 5.1(b)(iv)),
whose determination shall be final and conclusive as to all of the Unitholders absent
manifest clerical error.
8.2. Fiscal Year. The fiscal year (the βFiscal Yearβ) of the LLC shall constitute
the 12-month period ending on December 31 of each calendar year, or such other annual
accounting period as may be established by the Board; provided, that the written consent
of each of the Principal Investors shall be required to change the Fiscal Year. The taxable
year of the LLC shall be the same as the Fiscal Year, unless otherwise required by the Code
or applicable tax law.
8.3. Tax Information. The LLC shall use commercially reasonable efforts to
deliver or cause to be delivered, within 75 days after the end of each Fiscal Year, to each
Person who was a Unitholder at any time during such Fiscal Year all information necessary
for the preparation of such Personβs United States federal and state income tax returns.
8.4. Transmission of Communications. Each Person that owns or controls
Units on behalf of, or for the benefit of, another Person or Persons shall be responsible for
conveying any report, notice, or other communication received from the Board to such
other Person or Persons.
8.5. LLC Funds. The Board and Officers may not commingle the LLCβs funds
with the funds of any Unitholder or Manager.
ARTICLE IX
TAXES
9.1. Tax Returns. The LLC shall prepare and file all necessary federal and state
income tax returns, including making the elections described in Section 9.2. Each
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Unitholder shall furnish to the LLC all pertinent information in its possession relating to
LLC operations that is necessary to enable the LLCβs income tax returns to be prepared
and filed. No later than 30 days prior to the due date (including valid extensions) for filing
IRS Form 1065 with respect to the LLC, the LLC shall furnish to each Principal Investor
a draft copy of such Form 1065 and such Principal Investorβs associated Schedule K-1
(collectively, the βDraft Tax Formsβ). No later than 10 Business Days after receipt of such
Draft Tax Forms, each Principal Investor shall notify the LLC whether it approves such
Draft Tax Forms. If any Principal Investor does not so approve, it shall attempt to resolve
any disagreement with the other Principal Investor. If no such resolution is reached by the
due date (including valid extensions) for filing Form 1065 and associated Schedules K-1,
the LLC shall file such form and schedules in the manner approved by the Principal
Investor with the largest number of Units as of such date, but the other Principal Investor
shall not be required to report on its own tax returns in a manner consistent with such filed
Form 1065 and Schedules K-1. Except as otherwise provided in this Section 9.1, all
Unitholders agree not to take any position on any of their tax returns that are inconsistent
with the positions taken in the LLCβs filed income tax returns.
9.2. Tax Elections. Subject to the Subscription Agreement, Section 2.9 and
Section 5.1(b)(iv), the Tax Matters Partner (as defined below) shall make any election on
behalf of the LLC that the Tax Matters Partner deems appropriate in its reasonable
discretion. Notwithstanding the preceding sentence, the Tax Matters Partner shall make a
Code Section 754 election upon the request of any Investor in connection with a Transfer
of Units in compliance with Article X below.
9.3. Tax Matters Partner. Xxxxxxx (or an Affiliate so designated by Xxxxxxx)
shall be the partnership representative of the LLC, in accordance with Section 6223 of the
Code, and the tax matters partner of the LLC pursuant to Section 6231(a)(7) of the Code
as in effect before the enactment of the Bipartisan Budget Act of 2015 (and, in each case,
any similar provision under any state or local tax laws) (the βTax Matters Partnerβ). The
Tax Matters Partner shall cause the LLC to elect the application of Section 6226 of the
Code with respect to any Imputed Underpayment Amount; provided, that the procedures
set forth in applicable Treasury Regulations or other guidance under applicable Tax law
shall permit Xxxxxxx to push any reporting or other obligation under Section 6226 of the
Code through any upper tier partnerships that hold a direct or indirect interest in Xxxxxxx to
the direct and indirect equityholders in Xxxxxxx, in each case, without Xxxxxxx or such
equityholders incurring material additional Taxes, costs or expenses; provided, further, that
if the requirements set forth in the immediately preceding proviso are not satisfied, the LLC
shall pay any Imputed Underpayment Amount in accordance with Sections 6225(a) and
6232 of the Code, unless Xxxxxxx and Providence agree to use an alternative approach
permitted under the Code and applicable Treasury Regulations. Each Unitholder hereby
agrees (i) to take such actions as may be required to effect Xxxxxxxβx (or an Affiliate so
designated by Xxxxxxx) designation as the Tax Matters Partner and (ii) to cooperate to
provide any information or take such other actions as may be reasonably requested by the
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Tax Matters Partner in order to determine whether any Imputed Underpayment Amount
may be modified pursuant to Section 6225(c) of the Code. A Unitholderβs obligation to
comply with this Section 9.3 shall survive the transfer, assignment or liquidation of such
Unitholderβs interest in the LLC. Notwithstanding the foregoing, for so long as Providence
and its Affiliates own at least twenty percent (20%) of Providenceβs Closing Equity, the
Tax Matters Partner shall not (x) settle a Tax controversy that could reasonably be expected
to have a material adverse effect on Providence or its Affiliates without Providenceβs
written consent, which consent shall not be unreasonably withheld, conditioned or delayed
or (y) choose a litigation forum other than the United States Tax Court for a federal Tax
proceeding (where a choice for a federal Tax proceeding is available to the LLC and the
choices include such forum). The Tax Matters Partner shall keep Providence informed of
all material Tax issues arising in connection with a Tax proceeding affecting the LLC and
shall permit Providence to participate, at its own expense, in all Tax proceedings with
respect to the LLC which could reasonably be expected to adversely affect Providenceβs
or its Affiliatesβ Tax liability, including audits, administrative appeals and judicial
proceedings.
ARTICLE X
TRANSFERS
10.1. Transfers by Unitholders.
(a) No Unitholder shall Transfer any Units except in compliance with
this Article X. Except for Transfers to Permitted Transferees or Transfers pursuant to
Sections 10.4 (solely as a Tag-Along Unitholder), 10.6 (subject to Section 5.1(b)(iv)) or to
the LLC or a Subsidiary thereof pursuant to Sections 3.10, 3.11, or 3.12, no Unitholder
shall Transfer, or offer or agree to Transfer, all or any part of any interest in such Personβs
Units without the prior written consent of the Board and the Principal Investors, which
consent may be withheld in the Boardβs or either Principal Investorβs sole discretion, as
applicable. With the Board and the Principal Investorsβ consent, a Unitholder may Transfer
all or any part of such Unitholdersβ Units, subject to compliance with this Agreement
(including Section 10.1(c) and Section 10.4).
(b) Notwithstanding the foregoing, (x) each current or former Principal
Investor may Transfer all or any part of any interest in such Principal Investorβs Units
without the consent of the Board or the other current Principal Investor (if any) following
the earlier of (i) an initial Public Offering and (ii) the third (3rd) anniversary of the Effective
Date, subject, in each case, to compliance with this Agreement (including Sections 10.1(c),
10.4, 10.5 and 10.7), and applicable securities laws and (y) each Unitholder (other than the
current and former Principal Investors) may (subject to compliance with this Agreement
(including Sections 10.1(c) and 10.7) and the Registration Rights Agreement), following
the initial Public Offering, Transfer such Unitholderβs Units, but only to the extent such
Transfer would not result in the Relative Ownership Percentage of such Unitholder
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immediately following such Transfer being less than the Relative Ownership Percentage
of the Principal Investors immediately following such Transfer.
(c) Each transferee of Units or other interest in the LLC shall, as a
condition precedent to such Transfer, execute a counterpart to this Agreement pursuant to
which such transferee shall agree to be bound by the provisions of this Agreement and
comply with Section 11.2.
(d) Any Imputed Underpayment Amount that is properly allocable to a
transferor of an interest, as reasonably determined by the Board, shall be treated as a
Withholding Payment with respect to the applicable transferee in accordance with Section
4.6(f). Furthermore, as a condition to any Transfer, each transferor shall be required to
agree (i) to continue to comply with the provisions of Section 9.3 notwithstanding such
Transfer and (ii) to indemnify and hold harmless the LLC and the Board from and against
any and all liability with respect to the transfereeβs Withholding Payments resulting from
Imputed Underpayment Amounts attributable to the transferor to the extent that the
transferee fails to do so.
(e) As a condition to any Transfer, (A) if the transferor of Units who
proposes to Transfer such Units (or if such transferor is a disregarded entity for U.S. federal
income tax purposes, the first direct or indirect beneficial owner of such transferor that is
not a disregarded entity (the βTransferorβs Ownerβ)) is a βUnited States personβ as defined
in Section 7701(a)(30) of the Code, then such transferor (or Transferorβs Owner, if
applicable) shall complete and provide to both of the transferee and the LLC, a duly
executed affidavit in the form provided to such transferor by the LLC, certifying, under
penalty of perjury, that the transferor (or Transferorβs Owner, if applicable) is not a foreign
person, nonresident alien, foreign corporation, foreign partnership, foreign trust, or foreign
estate (as such terms are defined under the Code and applicable United States Treasury
Regulations) and the transferorβs (or Transferorβs Ownerβs, if applicable) United States
taxpayer identification number, or (B) if the transferor of Units who proposes to Transfer
such Units (or if such transferor is a disregarded entity for U.S. federal income tax
purposes, the Transferorβs Owner) is not βUnited States personβ as defined in Section
7701(a)(30) of the Code, then such transferor and transferee shall jointly provide to the
LLC written proof reasonably satisfactory to the Board that any applicable withholding tax
that may be imposed on such Transfer (including pursuant to Sections 864 and 1446 of the
Code) and any related tax returns or forms that are required to be filed, have been, or will
be, timely paid and filed, as applicable.
10.2. Effect of Assignment.
(a) Subject to Section 10.1, any Unitholder who shall assign any Units
or other interest in the LLC shall cease to be a Unitholder of the LLC with respect to such
Units or other interest and shall no longer have any rights or privileges of a Unitholder with
respect to such Units or other interest.
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(b) Subject to Section 10.1, any Person who acquires in any manner
whatsoever any Units or other interest in the LLC, irrespective of whether such Person has
accepted and adopted in writing the terms and provisions of this Agreement, shall be
deemed by the acceptance of the benefits of the acquisition thereof to have agreed to be
subject to and bound by all of the terms and conditions of this Agreement that any transferor
of such Units or other interest in the LLC was subject to or by which such transferor was
bound (it being understood that such transferee may no longer be eligible for certain rights
or privileges with respect to such Units or other interest that, pursuant to the terms hereof,
the transferor had by reason of the transferorβs status as a Principal Investor, subject to
Section 10.7 or as otherwise expressly provided in this Agreement).
10.3. Restrictions on Transfer.
(a) In order to permit the LLC to qualify for the benefit of a βsafe
harborβ under Code Section 7704, notwithstanding anything to the contrary in this
Agreement, no Transfer of any Unit or economic interest shall be permitted or recognized
by the LLC or the Board (within the meaning of Treasury Regulation Section 1.7704-1(d))
if and to the extent that such Transfer would cause the LLC to have more than 100 partners
(within the meaning of Treasury Regulation Section 1.7704-1(h), including the look-
through rule in Treasury Regulation Section 1.7704-1(h)(3)).
(b) Notwithstanding anything herein to the contrary, except with the
consent of the Principal Investors, no Unitholder shall Transfer any Units to any
Competitor or strategic investor unless such Transfer is made (i) pursuant to an Approved
Sale in accordance with Section 10.6 or (ii) to the public pursuant to (x) a Public Offering,
or (y) following a Public Offering, pursuant to Rule 144, in either case of (x) or (y), in a
market transaction and not a privately negotiated block trade.
10.4. Participation Rights.
(a) Prior to an initial Public Offering, at least thirty (30) days prior to
any sale or Transfer of Units by either Principal Investor (including any Transfer of Units
to the LLC or any of its Subsidiaries (whether by redemption, repurchase or otherwise))
(the βTag-Along Sellerβ), the Tag-Along Seller shall deliver a written notice (the βTag-
Along Noticeβ) to the other Unitholders (the βTag-Along Unitholdersβ) specifying in
reasonable detail the identity of the prospective transferee(s) and the terms and conditions
of the sale, including the number of Units to be sold and the cash price therefor (the βTag-
Along Offerβ). The Tag-Along Unitholders may elect to participate in the contemplated
sale by delivering written notice (a βTag-Along Response Noticeβ) to the Tag-Along Seller
within ten (10) days after delivery of the Tag-Along Notice. If any Tag-Along Unitholders
have elected to participate in such sale, the Tag-Along Seller and such Tag-Along
Unitholders will be entitled to sell in the contemplated Tag-Along Offer, at the same price
and on the same terms, a number of Units to be sold equal to the product of (A) such
Personβs Tag-Along Pro Rata Percentage multiplied by (B) the number of Units to be sold
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in the contemplated sale. If at the termination of such thirty (30)-day period any Unitholder
shall not have elected to participate in the Tag-Along Offer, such Unitholder will be
deemed to have waived its rights under this Section 10.4 with respect to such Tag-Along
Offer. Each Tag-Along Unitholderβs right to participate in such Tag-Along Offer shall be
conditioned upon (i) the consummation of the transactions contemplated in the Tag-Along
Notice with the prospective transferee(s) named therein, (ii) each Tag-Along Unitholderβs
execution and delivery of all transfer agreements and other related documents as the Tag-
Along Seller is required to execute and deliver in connection with such sale (including by
making therein representations and warranties as to (x) such Tag-Along Unitholderβs
ownership of his, her or its Units to be sold free and clear of all Liens (other than any
imposed by this Agreement), (y) such Tag-Along Unitholderβs power and authority to
effect such sale and certificate, if any, representing the applicable Units (together with an
executed stock (or similar) power or other conveyance document) and (z) such matters
pertaining to compliance with securities laws as the prospective transferee(s) may
reasonably require) and (iii) any Tag-Along Unitholder shall not be liable for the
inaccuracy of any representation or warranty made by any other person (unless such
representation is made jointly with such other person) in connection with the Tag-Along
Offer; provided that each Tag-Along Unitholder shall (a) be required (i) to bear his, her or
its proportionate share of any escrows, holdbacks or adjustments in purchase price and any
transaction expenses and (ii) to make such customary representations, warranties and
covenants and enter into such agreements as are customary for transactions of the nature
of the Tag-Along Offer, in each case on terms no less favorable to the Tag-Along
Unitholders than those disclosed in the Tag-Along Notice and (b) benefit from all of the
same provisions of the definitive agreements as the Tag-Along Seller, it being understood
that any liability of any Tag-Along Unitholder for indemnification or similar post-closing
obligations shall not exceed a proportional share of any such liability based on such Tag-
Along Unitholderβs share of the aggregate consideration in the Tag-Along Offer.
Notwithstanding anything in this Section 10.4 to the contrary, no Tag-Along Unitholder
(other than the Management Unitholders) shall be required to execute or enter into a non-
compete, non-solicitation or other similar restrictive covenant of any kind in connection
with such Tag-Along Offer other than a customary covenant (with customary and
reasonable carveouts consistent with those contained in this Agreement) with respect to the
protection of confidential or proprietary information; provided, however, notwithstanding
the foregoing, in no event shall the Rollover Holders be obligated to enter a non-compete,
non-solicitation or other similar restrictive covenant of any kind in connection with such
Tag-Along Offer that contains terms that are more restrictive than those set forth in the
Restrictive Covenant Agreements.
(b) The Tag-Along Seller will use commercially reasonable efforts to
obtain the agreement of the prospective transferee(s) to the participation of the Tag-Along
Unitholders in any contemplated Tag-Along Offer, and the Tag-Along Seller will not sell
any of its Units to the prospective transferee(s) unless (i) the prospective transferee(s) allow
the participation of the Tag-Along Unitholders or (ii) the Tag-Along Seller purchases the
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number of Units from the Tag-Along Unitholders that the Tag-Along Unitholders would
have been entitled to sell pursuant to Section 10.4(b)(i) for the amount of consideration per
Unit to be paid to the Tag-Along Seller by the prospective transferee(s).
(c) Notwithstanding anything to the contrary in any other provision of
this Agreement, this Section 10.4 shall not apply to (i) any Transfer of Units held by either
Principal Investor to or among its Affiliates (excluding, for the avoidance of doubt, any
member of the Company Group), (ii) any Transfer pursuant to Section 10.6 or (iii) any
Transfer in connection with a Public Offering.
(d) The restrictions contained in this Agreement will continue to be
applicable to the Units after any Transfer of such Units to transferee(s) pursuant to this
Section 10.4 and, as a condition precedent to any such Transfer, the transferee(s) of such
Units must agree in writing, in form and substance reasonably satisfactory to the LLC, to
be bound by the provisions of this Agreement.
(e) Notwithstanding anything contained in this Section 10.4, there shall
be no liability on the part of the Tag-Along Seller to the Tag-Along Unitholders (other than
the obligation to return any limited powers-of-attorney (and all copies thereof) together
with all certificates (if any) evidencing Units, as the case may be, received by the Tag-
Along Seller) if the sale of Units pursuant to a Tag-Along Offer under this Section 10.4 is
not consummated for whatever reason. Whether to effect a sale of Units pursuant to this
Section 10.4 by the Tag-Along Seller is in the sole discretion of the Tag-Along Seller.
(f) Notwithstanding the requirements of this Section 10.4, the Tag-
Along Seller may Transfer Units at any time without complying with the requirements of
Section 10.4(a) so long as such Transfer is solely for cash and the Tag-Along Seller
deposits into escrow with an independent third party at the time of sale that amount of the
consideration received in the sale equal to the βTag-Along Escrow Amount.β The βTag-
Along Escrow Amountβ shall equal that amount of consideration that all the Tag-Along
Unitholders would have been entitled to receive if all such Tag-Along Unitholders had the
opportunity to participate in the sale and to sell all of the Units which they would have been
entitled to include in the sale, determined as if each such Tag-Along Unitholder (i)
delivered a Tag-Along Response Notice to the Tag-Along Seller in the time period set forth
in Section 10.4(a) and (ii) proposed to include all of its Units which it would have been
entitled to include in the sale.
No later than the date of the sale, the Tag-Along Seller shall notify the LLC in
writing of the proposed sale. Such notice (the βTag-Along Escrow Noticeβ) shall set forth
the information required in the Tag-Along Notice, and in addition, such notice shall state
the name of the escrow agent and the account number of the escrow account. The LLC
shall promptly, and in any event within ten days of the date the LLC delivered or caused
to be delivered, the Tag-Along Escrow Notice, deliver or cause to be delivered the Tag-
Along Escrow Notice to each applicable Tag-Along Unitholder.
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A Tag-Along Unitholder may exercise the tag-along right described in this Section
10.4(f) by delivery to the Tag-Along Seller within 10 days of the date the LLC delivered
or caused to be delivered the Tag-Along Escrow Notice, of (i) a written notice specifying
the number of Units it proposes and is entitled to sell (which such number shall not exceed
such Tag-Along Unitholderβs pro rata share determined as provided in the first paragraph
of this Section 10.4(f)), and (ii) the certificates representing such securities, if any, with
transfer powers duly endorsed in blank.
Promptly after the expiration of the thirtieth (30th) day after the LLC has delivered
or caused to be delivered the Tag-Along Escrow Notice, (i) the Tag-Along Seller shall
purchase that number of Units as the Tag-Along Seller would have been required to include
in the sale had the Tag-Along Seller complied with the provisions of Section 10.4(a), (ii)
the LLC shall cause to be released from the escrow to the Tag-Along Unitholders from
whom the Tag-Along Seller purchases Units pursuant to clause (i) of this paragraph the
applicable amount of consideration due to such Tag-Along Unitholders together with any
interest thereon, if any, and (iii) all remaining funds and other consideration held in escrow
shall be released to the Tag-Along Seller.
(g) The provisions of this Section 10.4 shall terminate upon the
consummation of an initial Public Offering.
(h) In the event any Principal Investor sell less than 100% of their LLC
Interests in the LLC pursuant to this Section 10.4, joining βpro rata in such saleβ (or similar
phrases) shall be based on (i) relative Common Units and (ii) after giving effect to any
vesting, forfeiture or retention of Value Units in accordance with the provisions of this
Agreement as of the date of such sale, the vested Value Units of participating Other
Unitholders (with applicable adjustments made for Benchmark Amounts and other
appropriate provisions of this Agreement).
10.5. First Negotiation Rights. Subject to Sections 10.2, 10.3 and 10.4 (each of
which shall continue to apply to Transfers pursuant to this Section 10.5), prior to an initial
Public Offering, a Principal Investor desiring to Transfer any Units (other than to a
Permitted Transferee, in connection with an initial Public Offering or in connection with a
Tag-Along Sale or a Drag-Along Sale, in each case, pursuant to the terms of this Agreement
and the Registration Rights Agreement) (such Principal Investor, the βTransferring
Unitholderβ) shall give written notice (the βNegotiation Noticeβ) to the other Principal
Investor. The delivery of a Negotiation Notice shall begin a 180-day period during which
(i) the Transferring Unitholder shall not conduct negotiations or discussions concerning the
contemplated Transfer with any prospective transferees (other than the LLC or the other
Principal Investor) and (ii) the Transferring Unitholder, the LLC and the other Principal
Investor (the βNegotiation Partiesβ) will negotiate in good faith for the Transfer to one or
more of the Negotiation Parties of any or all Units held by the Transferring Unitholder. If
by the expiration of such 180-day period no such Transfer to one or more of the Negotiation
Parties has been negotiated (unless the Transferring Unitholder has otherwise agreed, at its
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election, in writing), then during the 180-day period following expiration of such 180-day
period, the Transferring Unitholder may Transfer its Units to any third party at any price
subject to the terms and conditions of this Agreement (including, for the avoidance of
doubt, Sections 10.2, 10.3, 10.4 and 10.6), but without needing to provide any additional
Negotiation Notice.
10.6. Drag-Along Rights.
(a) In connection with an Approved Sale, the Principal Investors (or if
such Approved Sale is approved by one Principal Investor, such Principal Investor) may
elect to require all other Unitholders to vote all Units then held by such Unitholders in
favor of such Approved Sale and to Transfer all or a portion of such Unitholderβs Units in
connection with such Approved Sale. In such case, each Unitholder shall vote for, consent
to and raise no objections against such Approved Sale. If the Approved Sale is structured
as a (i) merger or consolidation, each Unitholder shall waive any dissentersβ rights,
appraisal rights or similar rights in connection with such merger or consolidation or (ii) sale
of Units, each Unitholder shall agree to sell all of such Unitholderβs Units or rights to
acquire Units on the terms and conditions approved by the Principal Investors (or if such
Approved Sale is approved by one Principal Investor, such Principal Investor), subject to
this Section 10.6. Each Unitholder shall be obligated to fully participate in an Approved
Sale (on a pro rata basis to the extent that not all of the LLCβs Units are being transferred
in the Approved Sale), and shall be required to exercise all warrants, rights and options,
and convert all convertible securities to the extent required by the Principal Investors (or if
such Approved Sale is approved by one Principal Investor, such Principal Investor).
(b) In the event of an Approved Sale:
(i) each Unitholder shall, within fifteen (15) days following
written request from the LLC, deliver to the LLC certificates or other instruments
evidencing all Units held by such Unitholder, duly endorsed, together with all other
documents required to be executed in connection with such Approved Sale or, if such
delivery is not permitted by applicable law, an unconditional agreement to deliver such
Units pursuant to this Section 10.6(b) at the closing for such Approved Sale against
delivery to such Unitholder of the consideration therefor;
(ii) each Unitholder shall receive in exchange for each Unit held
by such Unitholder the same portion of the aggregate consideration from such sale or
exchange as each other Unitholder receives in respect of each of its Units and, if the
consideration from such sale or exchange is in the form of securities, then each Unitholder
shall be entitled to receive the same form of securities and the same amount of securities
per Unit as each other Unitholder and if any Unitholders are given an option as to the form
and amount of securities to be received, each Unitholder shall be given the same option;
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(iii) each Unitholder shall be obligated to join on a pro rata basis
(but not on a joint and several basis), based on such Unitholderβs share of the aggregate
proceeds paid in such Approved Sale, in any escrow, holdback, indemnification or other
obligations that the LLC agrees to provide in connection with such Approved Sale (other
than any such obligations that relate specifically to a particular Unitholder such as
indemnification with respect to representations and warranties given by such Unitholder
regarding such Unitholderβs title to and ownership of equity); provided that the
indemnification obligation of each Unitholder shall be limited to the amount of the
aggregate proceeds received by such Unitholder in the Approved Sale;
(iv) each Unitholder shall make representations and warranties
as to its title to or ownership of the Units being sold by such Unitholder in the proposed
sale and such Unitholderβs authority, power and right to enter into and consummate such
transaction without violating its applicable organizational documents or any other
agreement or legal requirement and other customary representations and warranties with
respect to matters particular to such Unitholder (including as to its due organization and
good standing under the laws of its jurisdiction of formation),
(v) no Unitholder shall be required to make any other
representations and warranties (other than as described in the foregoing clause (iv)),
including representations and warranties concerning any other Unitholder, the LLC, its
Subsidiaries or the business of the LLC or its Subsidiaries,
(vi) no Unitholder (other than the Management Unitholders)
shall be required to execute or enter into a non-compete, non-solicitation or other similar
restrictive covenant of any kind in connection with such Transfer other than a customary
covenant (with customary and reasonable carveouts consistent with those contained in this
Agreement) with respect to the protection of confidential or proprietary information;
provided, however, notwithstanding the foregoing, in no event shall the Rollover Holders
be obligated to enter a non-compete, non-solicitation or other similar restrictive covenant
of any kind in connection with such Transfer that contains terms that are more restrictive
than those set forth in the Restrictive Covenant Agreements.
(vii) each Unitholder agrees to cooperate and to take all
reasonably necessary or desirable actions required by the LLC in connection with the
consummation of an Approved Sale, including the execution of the sale agreement, stock
(or similar) powers and any other appropriate related document.
(c) If the LLC or any Unitholder enters into a negotiation or transaction
for which Rule 506 (or any similar rule then in effect) promulgated by the Securities and
Exchange Commission may be available with respect to such negotiation or transaction
(including a merger, consolidation or other reorganization), the Unitholders (other than
those qualifying as βAccredited Investorsβ) will, at the request of the LLC, appoint a
purchaser representative (as such term is defined in Rule 501) reasonably acceptable to the
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LLC. If any Unitholder appoint a purchaser representative designated by the LLC, the
LLC will pay the fees of such purchaser representative, but if any Unitholder declines to
appoint the purchaser representative designated by the LLC, such Unitholder will, if
required, appoint another purchaser representative, and such Unitholder will be responsible
for the fees of the purchaser representative so appointed.
(d) Unitholders who are obligated to participate in the Approved Sale
will bear their pro rata share of the costs of any sale pursuant to an Approved Sale to the
extent such costs are incurred for the benefit of all Unitholders and are not otherwise paid
by the LLC or the acquiring party. For purposes of this Section 10.6(d), costs incurred in
exercising reasonable efforts to take all actions in connection with the consummation of an
Approved Sale in accordance with Section 10.6(a) shall be deemed to be for the benefit of
all Unitholders. For the avoidance of doubt, costs incurred by a Unitholder on such
Unitholderβs own behalf will not be considered costs of the transaction.
(e) Notwithstanding anything contained in this Section 10.6, there shall
be no liability on the part of the LLC, the Board or the Unitholders to any other Unitholder
(other than the obligation to return any certificates or other applicable instruments
representing such Unitholderβs Units received by the LLC) if the transfer of the
Unitholderβs Units pursuant to this Section 10.6 is not consummated for whatever reason.
Subject to Section 10.6(a), whether to effect a transfer of Units pursuant to this
Section 10.6 is in the sole discretion of the Principal Investors.
(f) In the event any Principal Investor sell less than 100% of their LLC
Interests in the LLC pursuant to this Section 10.6, joining βpro rata in such saleβ (or similar
phrases) shall be based on (i) relative Common Units and (ii) after giving effect to any
vesting, forfeiture or retention of Value Units in accordance with the provisions of this
Agreement as of the date of such sale, the vested Value Units of participating Other
Unitholders (with applicable adjustments made for Benchmark Amounts and other
appropriate provisions of this Agreement).
10.7. Transfer of Consent and Designation Rights. Each Principal Investor
may transfer its rights to (i) consent to the actions listed in Section 5.1(b)(iv) and Section
6.11 and (ii) designate Managers under Section 5.2 to a Transferee pursuant to a Transfer
in accordance with this Article X only if (x) such Transferee is a Permitted Transferee or
(y) such Transfer is occurring on or after the third (3rd) anniversary of the Effective Date
and such Transferee is reasonably acceptable to the other Principal Investor and agrees to
the terms of this Agreement; provided, that (1) with respect to the rights to consent to the
actions listed in Section 5.1(b)(iv)(A) β (D) (and clauses (T) and (U) to the extent
applicable), such rights shall transfer only if the Principal Investor transfers at least twenty
percent (20%) of such Principal Investorβs Closing Equity to the Transferee, (2) with
respect to the rights to consent to the actions listed in Section 5.1(b)(iv) (E) β (S) (and
clauses (T) and (U) to the extent applicable), such rights shall transfer only if the Principal
Investor transfers at least fifty percent (50%) of such Principal Investorβs Closing Equity
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to the Transferee and (3) with respect to the rights to designate Managers under Section
5.2, such rights shall transfer in proportion to the number of Units transferred by the
Principal Investor (e.g., if a Principal Investor transfers thirty-three percent (33%) of its
Units and immediately prior to such transfer such Principal Investor had the right to appoint
three (3) Managers, the right to appoint one (1) Manager would transfer to the Transferee)
and only if and to the extent such Transfer would result in the loss of a Board designee
pursuant to Section 5.2.(a)(viii); provided, that in no circumstance shall the Transferee and
Transferor have the right to designate a greater number of Managers following the transfer
than the Transferee had the right to designate immediately prior to such transfer. Any such
Transferee shall be subject to the applicable provisions hereof with respect to the loss and
transferability of such rights, mutatis mutandis.
10.8. Void Transfers. Any Transfer by any Unitholder of any Units or other
interest in the LLC in contravention of this Agreement or which would cause the LLC to
not be treated as a partnership for U.S. federal income tax purposes shall be void and
ineffectual and shall not bind or be recognized by the LLC or any other party. No purported
assignee shall have any right to any profits, losses or distributions of the LLC.
10.9. Legends. In addition to any other legend that may be required, each
certificate, if any, representing Units shall bear a legend in substantially the following form:
βTHE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE
ISSUED WITHOUT REGISTRATION UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE βACTβ), AND MAY NOT BE SOLD,
ASSIGNED, PLEDGED OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION UNDER THE ACT
COVERING THE TRANSFER, ASSIGNMENT, PLEDGE OR SALE, OR
AN OPINION OF COUNSEL, SATISFACTORY TO THE ISSUER,
THAT REGISTRATION UNDER THE ACT IS NOT REQUIRED. THIS
SECURITY IS ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON
TRANSFER AS SET FORTH IN THE SECOND AMENDED AND
RESTATED LIMITED LIABILITY COMPANY AGREEMENT, DATED
AS OF FEBRUARY 16, 2018, COPIES OF WHICH MAY BE
OBTAINED UPON REQUEST FROM THE LLC OR ANY SUCCESSOR
THERETO.β
ARTICLE XI
ADMISSION OF UNITHOLDERS
11.1. Substituted Unitholders. In connection with the Transfer of an LLC
Interest of a Unitholder permitted under the terms of this Agreement, the transferee shall
become a Substituted Unitholder with respect to the transferred LLC Interest on the
effective date of such Transfer, which effective date shall not be earlier than the date of
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compliance with or waiver of the conditions to such Transfer (unless one of the conditions
to such Transfer is that Board or Unitholder consent is required for the admission of such
transferee, in which case such consent must first be obtained), including executing a
counterpart of, and become a party to, this Agreement in form and substance reasonably
acceptable to the Board, whereupon such admission shall be shown on the books and
records of the LLC.
11.2. Additional Unitholders. A Person may be admitted to the LLC as an
Additional Unitholder only as contemplated under, and in compliance with, the terms of
this Agreement, including furnishing to the Board (a) a letter of acceptance, in form
satisfactory to the Board, of all the terms and conditions of this Agreement, including the
power of attorney granted in Section 15.1, and (b) such other documents or instruments as
may be necessary or appropriate to effect such Personβs admission as a Unitholder. Such
admission shall become effective on the date on which the Board determines in its sole
discretion that such conditions have been satisfied and when any such admission is shown
on the books and records of the LLC. Thereafter, an Officer authorized by the Board shall
amend Schedule A without the further vote, act or consent of any other Person to reflect
such new Person as a Unitholder and shall make available for review a copy of such
amended Schedule A to each Unitholder.
11.3. Optionholders. Except as set forth in this Agreement, no Person that holds
securities (including options, warrants, or rights) exercisable, exchangeable, or convertible
into Units shall have any rights with respect to such Units until such Person is actually
issued Units upon such exercise, exchange, or conversion and, if such Person is not then a
Unitholder, is admitted as a Unitholder pursuant to Section 11.2.
ARTICLE XII
WITHDRAWAL AND RESIGNATION OF UNITHOLDERS
12.1. Withdrawal and Resignation of Unitholders. No Unitholder shall have
the power or right to withdraw or otherwise resign or be expelled from the LLC prior to
the dissolution and winding up of the LLC pursuant to Article XIII, except as otherwise
expressly permitted by this Agreement or any of the other agreements contemplated
hereby. Notwithstanding that payment on account of a withdrawal may be made after the
effective time of such withdrawal, any completely withdrawing Unitholder will not be
considered a Unitholder for any purpose after the effective time of such complete
withdrawal, and, in the case of a partial withdrawal, such Unitholderβs Capital Account
(and corresponding voting and other rights) shall be reduced for all other purposes
hereunder upon the effective time of such partial withdrawal.
12.2. Withdrawal of a Unitholder. No Unitholder shall have the power or right
to withdraw or otherwise resign from the LLC except (i) as otherwise expressly permitted
by this Agreement, or (ii) simultaneous with the Transfer of all of a Unitholderβs Units in
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a Transfer permitted by this Agreement and, if such Transfer is to a Person that is not a
Unitholder, the admission of such Person as a Unitholder pursuant to Section 11.1.
ARTICLE XIII
DISSOLUTION AND LIQUIDATION
13.1. Dissolution. The LLC shall not be dissolved by the admission of Additional
Unitholders or Substituted Unitholders, or by the death, retirement, expulsion, bankruptcy
or dissolution of a Unitholder. The LLC shall dissolve, and its affairs shall be wound up
upon the first to occur of the following:
(a) at any time by decision of each of the Principal Investors; or
(b) the entry of a decree of judicial dissolution of the LLC under Section
18-802 of the Delaware Act.
Except as otherwise set forth in this Article XIII, the LLC is intended to have
perpetual existence. An Event of Withdrawal shall not cause a dissolution of the LLC and
the LLC shall continue in existence subject to the terms and conditions of this Agreement.
13.2. Liquidation and Termination.
(a) On dissolution of the LLC, the Board shall act as liquidator or may
appoint one or more representatives or Unitholders as liquidator. The liquidators shall
proceed diligently to wind up the affairs of the LLC, sell all or any portion of the LLC
assets for cash or cash equivalents as they deem appropriate, and make final distributions
as provided herein and in the Delaware Act. The costs of liquidation shall be borne as an
LLC expense. In connection with any such liquidation or dissolution, before making any
distribution to Unitholders under Article IV above, the LLC shall purchase an extended
reporting period βtailβ insurance policy covering the matters described in Section 7.7 for
the six-year period commencing on the date of dissolution or liquidation. Until final
distribution, the liquidators shall continue to operate the LLC properties with all of the
power and authority of the Board. The liquidators shall pay, satisfy, or discharge from
LLC funds all of the debts, liabilities, and obligations of the LLC (including all expenses
incurred in liquidation) or otherwise make adequate provision for payment and discharge
thereof (including the establishment of a cash fund for contingent liabilities in such amount
and for such term as the liquidators may reasonably determine) and shall promptly
distribute the remaining assets to the holders of Units in accordance with Section 4.1(a).
Any non-cash assets will first be written up or down to their Fair Market Value, thus
creating Profit or Loss (if any), which shall be allocated in accordance with Sections 4.2
and 4.3. In making such distributions, the liquidators shall allocate each type of asset (i.e.,
cash, cash equivalents, securities, etc.) among the Unitholders ratably based upon the
aggregate amounts to be distributed with respect to the Units held by each such holder.
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Any such distributions in kind shall be subject to (x) such conditions relating to the
disposition and management of such assets as the liquidators deem reasonable and
equitable and (y) the terms and conditions of any agreement governing such assets (or the
operation thereof or the holders thereof) at such time. The distribution of cash and/or
property to a Unitholder in accordance with the provisions of this Section 13.2 constitutes
a complete return to the Unitholder of its Capital Contributions and a complete distribution
to the Unitholder of its interest in the LLC and all the LLCβs property and constitutes a
compromise to which all Unitholders have consented within the meaning of the Delaware
Act. To the extent that a Unitholder returns funds to the LLC, it has no claim against any
other Unitholder for those funds.
(b) Neither the purchase nor redemption by the LLC of any Units in any
manner permitted by the Certificate or any amendment thereof or this Agreement, if any,
nor the merger or consolidation of the LLC with or into any other business entity (as
defined in the Delaware Act), nor the conversion of the LLC into a corporation under
Delaware (or other state) law, nor a sale, exchange, conveyance, transfer or lease of all or
substantially all of the LLCβs assets shall be deemed to be a liquidation, dissolution or
winding up of the LLC for the purposes of this Section 13.2.
13.3. Cancellation of Certificate. On completion of the distribution of LLC
assets as provided herein, the LLC shall be terminated (and the LLC shall not be terminated
prior to such time), and the Board (or such other Person or Persons as the Delaware Act
may require or permit) shall file a certificate of cancellation with the Secretary of State of
Delaware, cancel any other filings made pursuant to this Agreement that are or should be
canceled, and take such other actions as may be necessary to terminate the LLC. The LLC
shall be deemed to continue in existence for all purposes of this Agreement until it is
terminated pursuant to this Section 13.3.
13.4. Reasonable Time for Winding Up. A reasonable time shall be allowed
for the orderly winding up of the business and affairs of the LLC and the liquidation of its
assets pursuant to Section 13.2 in order to minimize any losses otherwise attendant upon
such winding up.
13.5. Return of Capital. The liquidators shall not be personally liable for the
return of Capital Contributions or any portion thereof to the Unitholders (it being
understood that any such return shall be made solely from LLC assets).
13.6. Reserves Against Distributions. The Board shall have the right to
withhold from Distributions payable to the Unitholders under this Agreement (pro rata in
accordance with the proportion of such Distributions payable to the Unitholders in
accordance with Section 4.1) amounts sufficient to pay and discharge any reasonably
anticipated contingent liabilities of the LLC, and any amounts remaining after payment and
discharge of any such contingent liabilities of the LLC will be paid to the Unitholders pro
rata in accordance with the proportions of such prior withholding.
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ARTICLE XIV
VALUATION
14.1. Determination. Subject to Section 14.2, the Fair Market Value of the assets
of the LLC or of a LLC Interest will be determined by the Board (or, if pursuant to Section
13.2, the liquidators) in its good faith judgment in such manner as it deems reasonable and
using all factors, information and data deemed to be pertinent (including, if the Board so
determines, the recommendation of an independent third-party appraiser engaged by the
Board for such purpose), in the case of Sections 3.6.(c) and 13.2(a), with the consent of
each Principal Investor.
14.2. Fair Market Value. βFair Market Valueβ of (i) a specific LLC asset will
mean the amount which the LLC would receive in an all-cash sale of such asset (free and
clear of all Liens and after payment of all liabilities secured only by such asset) in an arms-
length transaction with an unaffiliated third party consummated on the day immediately
preceding the date on which the event occurred which necessitated the determination of the
Fair Market Value (and after giving effect to any transfer taxes payable in connection with
such sale); and (ii) the LLC will mean the amount which the LLC would receive in an all-
cash sale of all of its assets and businesses as a going concern (free and clear of all Liens
and after payment of indebtedness for borrowed money) in an arms-length transaction with
an unaffiliated third party consummated on the day immediately preceding the date on
which the event occurred which necessitated the determination of the Fair Market Value
(assuming that all of the proceeds from such sale were paid directly to the LLC other than
an amount of such proceeds necessary to pay transfer taxes payable in connection with
such sale, which amount will not be received or deemed received by the LLC). After a
determination of the Fair Market Value of the LLC is made as provided above, the Fair
Market Value of a Unit will be determined by making a calculation reflecting the cash
distributions which would be made to the Unitholders in accordance with this Agreement
in respect of such Unit if the LLC were deemed to have received such Fair Market Value
in cash and then distributed the same to the Unitholders in accordance with the terms of
this Agreement incident to the liquidation of the LLC after payment to all of the LLCβs
creditors from such cash receipts other than payments to creditors who hold evidence of
indebtedness for borrowed money, the payment of which is already reflected in the
calculation of the Fair Market Value of the LLC and assuming that all of the convertible
debt and other convertible securities were repaid or converted (whichever yields more cash
to the holders of such convertible securities) and all options to acquire Units (whether or
not currently exercisable) that have an exercise price below the Fair Market Value of such
Units were exercised and the exercise price therefor paid. Except as otherwise provided
herein or in any agreement, document or instrument contemplated hereby, any amount to
be paid under this Agreement by reference to the Fair Market Value shall be paid in full in
cash, and any Unit being transferred in exchange therefor will be transferred free and clear
of all Liens.
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14.3. Dispute Resolution. Notwithstanding anything in this Article XIV to the
contrary, in the event that either (i) the Ekbatani Holder solely with respect to Section
3.11, or (ii) the Rollover Holders solely with respect to Section 3.12 (each Unitholder
described in clauses (i) and (ii), as applicable, the βRelevant Holderβ) disputes the Boardβs
determination of Fair Market Value in connection with the LLCβs exercise of the Ekbatani
Repurchase Option or the Rollover Call Option (as applicable, a βDisputeβ), which Dispute
the Relevant Holder shall have no less than fourteen (14) days to notify the LLC of
following the Relevant Holderβs receipt of a repurchase notice pursuant to Section 3.11 or
Section 3.12, as applicable, then the applicable Relevant Holder and the Board will
negotiate in good faith to resolve any such Dispute, but if they do not reach a final
resolution within thirty (30) days after the delivery of a Dispute notice by such Relevant
Holder to the LLC, the LLC and such Relevant Holder will retain and submit such Dispute
to a regionally-recognized independent accounting firm as mutually agreed upon by such
Relevant Holder and the LLC (the βIndependent Auditorβ) to resolve such Dispute. The
Independent Auditor will be instructed to set forth a procedure to provide for prompt
resolution of any such Dispute and, in any event, to make its determination in respect of
such Dispute within thirty (30) days following its retention. The applicable Relevant
Holder and the LLC, and their respective representatives, will cooperate fully with the
Independent Auditor during its engagement and respond on a timely basis to all requests
for information or access to documents or personnel made by the Independent Auditor, all
with the intent to fairly and in good faith resolve the Dispute as promptly as reasonably
practicable. In resolving the Dispute, the Independent Auditor (i) may not assign a value
to any particular item greater than the greatest value for such item claimed by the applicable
Relevant Holder or the LLC, or less than the lowest value for such item claimed by the
applicable Relevant Holder or the LLC, in each case, as presented to the Independent
Auditor, (ii) will be bound by the principles set forth in this Agreement (including this
Article XIV) and the DPN Purchase Agreement (with respect to Section 3.12), and (iii)
will act as an expert and not as an arbitrator. The Independent Auditorβs determination of
such Dispute will be final and binding upon the applicable Relevant Holder and the LLC.
All fees and expenses of the Independent Auditor shall be borne pro rata as between the
applicable Relevant Holder, on the one hand, and the LLC, on the other hand, in proportion
to the allocation of the dollar value of the amounts in dispute as between the applicable
Relevant Holder and the LLC (set forth in the initial written submissions to the Independent
Auditor) made by the Independent Auditor such that the party prevailing on the greater
dollar value of such disputes pays the lesser proportion of the fees and expenses.
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ARTICLE XV
GENERAL PROVISIONS
15.1. Power of Attorney.
(a) Each Unitholder, other than the Principal Investors, hereby
constitutes and appoints each member of the Board and the liquidators, with full power of
substitution, as his, her or its true and lawful agent and attorney-in-fact, with full power
and authority in his, her or its name, place and stead, to execute, swear to, acknowledge,
deliver, file, and record in the appropriate public offices (i) this Agreement, all certificates,
and other instruments and all amendments (in the manner set forth herein) thereof in
accordance with the terms hereof which the Board deems appropriate or necessary to form,
qualify, or continue the qualification of, the LLC as a limited liability company in the State
of Delaware and in all other jurisdictions in which the LLC may conduct business or own
property; (ii) all documents or instruments which the Board deems appropriate or necessary
to reflect any amendment, change, modification, or restatement of this Agreement made
pursuant to the terms of this Agreement (including any required approval by Unitholders
pursuant to Section 15.3 hereof); (iii) all conveyances and other instruments or documents
which the Board deems appropriate or necessary to reflect the dissolution and liquidation
of the LLC pursuant to the terms of this Agreement, including a certificate of cancellation;
and (iv) all instruments relating to the admission, withdrawal, or substitution of any
Unitholder pursuant to Articles XI and XII.
(b) The foregoing power of attorney is irrevocable and coupled with an
interest, and shall survive the death, disability, incapacity, dissolution, bankruptcy,
insolvency, or termination of any Unitholder and the Transfer of all or any portion of his,
her or its LLC Interest and shall extend to such Unitholderβs heirs, successors, assigns, and
personal representatives.
15.2. Confidentiality. Except as otherwise provided in this Section 15.2, no
Unitholder shall, in any manner, either directly or indirectly, divulge, disclose, or
communicate to any Person any non-public information, data, observations or materials
relating to the LLC or any of its Subsidiaries or their respective assets, liabilities,
operations, businesses, affairs and activities (including any notes, summaries, evaluations,
analyses and other material derived from any such information, data, observations or
materials) (collectively, βConfidential Informationβ); provided, however, that the
foregoing confidentiality obligation shall not apply to any Confidential Information that
(a) has previously become available to the general public for a period of at least two (2)
Business Days (other than as a result of wrongful disclosure by the Unitholder) or (b)
becomes available to the Unitholder on a non-confidential basis from a source other than
the LLC or any of its Subsidiaries, so long as such source is not known by the Unitholder
(after reasonable inquiry) to be subject to another confidentiality agreement. Until the
termination of this Agreement, no Unitholder shall make any use of any Confidential
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Information other than to further the operations, businesses, affairs and activities of the
LLC and its Subsidiaries or to evaluate or monitor (in its capacity as a Unitholder) its
investment in the LLC. The foregoing provisions of this Section 15.2 shall not prohibit the
disclosure of Confidential Information by (i) any Unitholder to the extent required by
applicable law, rule, regulation, governmental body or stock exchange (including
regulatory and self-regulatory bodies), court order or other governmental decree, (ii) any
current or former Principal Investor to the extent required or appropriate in connection with
federal securities laws, stock exchange requirements or other public company reporting or
disclosure obligations, in which case the current or former Principal Investor intending to
make the release or disclosure of such Confidential Information shall use commercially
reasonable efforts to consult with the other Principal Investor (if any) to the extent
practicable about, and allow the other party reasonable time (taking into account the
circumstances, including exigent circumstances) to comment on, such release or disclosure
in advance of such issuance, and the current or former Principal Investor intending to make
the release or disclosure will consider such comments in good faith, (iii) any Unitholder
with the written consent of the Principal Investors, which consent may be withheld by the
Principal Investors in their sole discretion, (iv) any Unitholder to any officer, director,
manager, employee or other representative (βRepresentativesβ), Affiliate or
Representatives of an Affiliate of such Unitholder if such Person has a need to know such
information and has agreed or is otherwise obligated not to communicate such information
to any other Person or use the Confidential Information for his, her or its own benefit, for
any purpose other than to monitor the recipientβs indirect interest in the LLC or in a manner
adverse to the interests of the LLC or (v) any current or former Principal Investor to any
limited partner of such current or former Principal Investor, but only to the extent such
Confidential Information being disclosed does not contain material, non-public
information and is of a nature customarily disclosed by private investment funds to their
limited partners in the ordinary course of business consistent with past practice and the
recipient of such Confidential Information has been advised and directed not to
communicate such information to any other Person or use the Confidential Information for
his, her or its own benefit, for any purpose other than to monitor the recipientβs indirect
interest in the LLC or in a manner adverse to the interests of the LLC. Each Unitholder
shall take reasonable steps to inform its Representatives, Affiliates and limited partners
who receive access by such Unitholder to any Confidential Information of the provisions
of this Section 15.2, and any other Person who receives access to any Confidential
Information from such Unitholder pursuant to clauses (iv) or (v) of the foregoing sentence,
and such Unitholder shall be responsible for any violation of this Section 15.2 by such
Persons as if such Persons been bound hereunder. Except for any disclosure made pursuant
to Section 15.2(ii), if any Unitholder is required by applicable law, rule, regulation,
governmental body or stock exchange (including regulatory and self-regulatory bodies),
court order or other governmental decree to disclose Confidential Information, such
Unitholder shall give prompt written notice of such fact to the LLC so that the LLC may
seek a protective order or other governmental or judicial relief to prevent disclosure of such
information. Notwithstanding the foregoing, the LLC and each Unitholder acknowledges
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that, in the ordinary course of business of each member of the Investor Group, the members
of the Investor Group evaluate, pursue, acquire, sell, manage, advise and serve on the
boards of other Persons. The LLC and each Unitholder acknowledges that (x) the review
of the Confidential Information by each of Xxxxxxx, Providence and the members of the
Investor Group may inevitably enhance such Personsβ or their respective Affiliatesβ general
industry knowledge and understanding of the industries in which the Company Group
operates in a way that cannot be separated from such Personsβ or their respective Affiliatesβ
other knowledge, and the LLC and each Unitholder agrees that this Section 15.2 shall not
restrict such Personsβ or their respective Affiliatesβ use of such general industry knowledge
and understanding, including in connection with investments in other companies (including
in the same or similar industries) and (y) none of Xxxxxxx or Providence or any member of
the Investor Group shall be deemed to have used any Confidential Information in
contravention of this Section 15.2 solely because of the fact of its evaluation, pursuit,
acquisition, sale or management of, provision of advice to, or service on the board of any
such other investment. In no event shall the restrictions set forth in this Section restrict a
Unitholder from enforcing its rights under this Agreement.
15.3. Amendments.
(a) This Agreement may be amended from time to time by the Board to
reflect the Transfer of Units or other interests in the LLC effectuated pursuant to the terms
of Article X or to reflect the admission of Unitholders effectuated pursuant to the terms of
Article XI. Any provisions of this Agreement may be amended, modified, supplemented
or waived with the written approval of the LLC and the Principal Investors; provided, that
no amendment or modification pursuant to this Section 15.3 that would by its terms
adversely affect any holders of Units in a manner materially disproportionate to the other
holders of Units, in their capacities as such, shall be effective against such holders without
the written consent of holders of at least a majority in interest (with respect to the applicable
Units) of such disproportionately materially adversely affected holders.
(b) Notwithstanding anything to the contrary in Section 15.3(a) above,
for so long as the Ekbatani Holder owns three percent (3%) or more of the LLCβs
outstanding Common Units, the following may not be amended in a manner adverse to
Ekbatani or the Ebkatani Holder without the consent of Ekbatani: (i) Section 3.5
(Preemptive Rights), Section 6.12 (Initial Public Offering) (and the Exhibit A referenced
therein), Section 10.4 (Participation Rights), Section 10.6 (Drag-Along Rights) and this
Section 15.3(b) (and any of the defined terms used in any such Sections) and (ii) any rights
given to Ekbatani or the Ekbatani Holder herein by name in this Agreement. For the
avoidance of doubt, the LLC may, subject to Section 3.5, freely authorize and issue LLC
Interests at any time, including LLC Interests which have preferred rights of any type or
nature as compared to the rights of any existing Unitholders, and the LLC may make any
such amendments, modifications or supplements to this Agreement as necessary to give
effect to any such authorization and/or issuance of LLC Interests (including amending this
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Agreement to incorporate the rights, preferences or privileges in respect of such equity
interests) without obtaining the consent of Ekbatani.
15.4. Title to LLC Assets. LLC assets shall be deemed to be owned by the LLC
as an entity, and no Unitholder, individually or collectively, shall have any ownership
interest in such LLC assets or any portion thereof. Legal title to any or all LLC assets may
be held in the name of the LLC or one or more nominees, as the Board may determine.
The Board hereby declares and warrants that any LLC assets for which legal title is held in
its name or the name of any nominee shall be held in trust by the Board or such nominee
for the use and benefit of the LLC in accordance with the provisions of this Agreement.
All LLC assets shall be recorded as the property of the LLC on its books and records,
irrespective of the name in which legal title to such LLC assets is held.
15.5. Remedies. Each Unitholder and the LLC shall have all rights and remedies
set forth in this Agreement and all rights and remedies which such Person has been granted
at any time under any other agreement or contract and all of the rights which such Person
has under any law. Each party hereto acknowledges that the remedies at law of the other
parties for a breach or threatened breach of this Agreement would be inadequate and, in
recognition of this fact, any party to this Agreement, without posting any bond, and in
addition to all other remedies that may be available, shall be entitled to obtain equitable
relief in the form of specific performance, a temporary restraining order, a temporary or
permanent injunction or any other equitable remedy that may then be available (including,
without limitation, with respect to the enforcement of Section 3.11 and Section 3.12).
15.6. Successors and Assigns. All covenants and agreements contained in this
Agreement shall bind and inure to the benefit of the parties hereto and their respective
heirs, executors, administrators, successors, legal representatives, and permitted assigns,
whether so expressed or not.
15.7. Severability. Whenever possible, each provision of this Agreement will be
interpreted in such manner as to be effective and valid under applicable law, but if any
provision of this Agreement is held to be invalid, illegal, or unenforceable in any respect
under any applicable law or rule in any jurisdiction, such invalidity, illegality, or
unenforceability will not affect any other provision or the effectiveness or validity of any
provision in any other jurisdiction, and this Agreement will be reformed, construed, and
enforced in such jurisdiction as if such invalid, illegal, or unenforceable provision had
never been contained herein.
15.8. Regulatory Matters. The LLC shall and shall cause its Subsidiaries to
keep the Unitholders informed, on a current basis, of any events, discussions, notices or
changes with respect to any criminal or regulatory investigation or action involving the
LLC or any of its Subsidiaries, so that the Unitholders will have the opportunity to take
appropriate steps to avoid or mitigate any regulatory consequences to them that might arise
from such investigation or action. Additionally, upon and to the extent of a prior written
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request therefor, the LLC shall provide to the Unitholders reasonable access during normal
business hours to personnel, books and records and such other information as any
Unitholder may reasonably require for tax or regulatory purposes that are customary for
investments of this type, including all rights necessary to satisfy venture capital operating
company rules.
15.9. Notice to Unitholder of Provisions. By executing this Agreement, each
Unitholder acknowledges that he, she or it has actual notice of (a) all of the provisions
hereof (including the restrictions on the transfer set forth herein), and (b) all of the
provisions of the Certificate.
15.10. Counterparts. This Agreement may be executed in multiple counterparts
with the same effect as if all signing parties had signed the same document. All
counterparts shall be construed together and constitute the same instrument.
15.11. Consent to Jurisdiction. Each Unitholder irrevocably submits to the
exclusive jurisdiction of the United States District Court for the State of Delaware and the
state courts of the State of Delaware for the purposes of any suit, action or other proceeding
arising out of this Agreement or any transaction contemplated hereby. Each Unitholder
further agrees that service of any process, summons, notice or document by United States
certified or registered mail to such Unitholderβs respective address set forth in the LLCβs
books and records or such other address or to the attention of such other person as the
recipient party has specified by prior written notice to the sending party shall be effective
service of process in any action, suit or proceeding in Delaware with respect to any matters
to which it has submitted to jurisdiction as set forth above in the immediately preceding
sentence. Each Unitholder irrevocably and unconditionally waives any objection to the
laying of venue of any action, suit or proceeding arising out of this Agreement or the
transactions contemplated hereby in the United States District Court for the State of
Delaware or the state courts of the State of Delaware and hereby irrevocably and
unconditionally waives and agrees not to plead or claim in any such court that any such
action, suit or proceeding brought in such court has been brought in an inconvenient forum.
15.12. Descriptive Headings; Interpretation. The descriptive headings of this
Agreement are inserted for convenience only and do not constitute a substantive part of
this Agreement. Whenever required by the context, any pronoun used in this Agreement
shall include the corresponding masculine, feminine, or neuter forms, and the singular form
of nouns, pronouns, and verbs shall include the plural and vice versa. The use of the word
βincludingβ in this Agreement shall be by way of example rather than by limitation. Except
as otherwise indicated herein, the terms βhereinβ, βhereofβ, βheretoβ, βhereunderβ and
similar terms refer to this Agreement generally rather than to the particular provision in
which such term is used. Reference to any agreement, document, or instrument means
such agreement, document, or instrument as amended or otherwise modified from time to
time in accordance with the terms thereof, and, if applicable, hereof (including as relates
to the Advisory Agreement). Without limiting the generality of the immediately preceding
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sentence, no amendment or other modification to any agreement, document, or instrument
that requires the consent of any Person pursuant to the terms of this Agreement or any other
agreement will be given effect hereunder unless such Person has consented in writing to
such amendment or modification. Unless the context otherwise requires, any reference
herein to any Person shall be construed to include such Personβs successors and assigns.
Wherever required by the context, references to a Fiscal Year shall refer to a portion
thereof. The use of the words βor,β βeither,β and βanyβ shall not be exclusive. It is the
intention of the parties that every covenant, term, and provision of this Agreement shall be
construed simply according to its fair meaning and not strictly for or against any party
(notwithstanding any rule of law requiring an Agreement to be strictly construed against
the drafting party), it being understood that the parties to this agreement are sophisticated
and have had adequate opportunity and means to retain counsel to represent their interests
and to otherwise negotiate the provisions of this Agreement. The parties hereto have
participated jointly in the negotiation and drafting of this Agreement. In the event an
ambiguity or question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise
favoring or disfavoring any party by virtue of the authorship of any of the provisions of
this Agreement. Wherever a conflict exists between this Agreement and any other
agreement, this Agreement shall control but solely to the extent of such conflict.
15.13. Applicable Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware, without giving effect to any choice of
law or conflict of law rules or provisions (whether of the State of Delaware or any other
jurisdiction) that would cause the application of the laws of any jurisdiction other than the
State of Delaware.
15.14. MUTUAL WAIVER OF JURY TRIAL. BECAUSE DISPUTES
ARISING IN CONNECTION WITH COMPLEX TRANSACTIONS ARE MOST
QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND
EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL
LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES
DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH
APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF
THE BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION, EACH
PARTY TO THIS AGREEMENT (INCLUDING THE LLC) HEREBY WAIVES ALL
RIGHTS TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING
BROUGHT TO RESOLVE ANY DISPUTE BETWEEN OR AMONG ANY OF THE
PARTIES HERETO, WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE,
ARISING OUT OF, CONNECTED WITH, RELATED OR INCIDENTAL TO THIS
AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREBY AND/OR THE
RELATIONSHIPS ESTABLISHED AMONG THE PARTIES HEREUNDER.
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15.15. Addresses and Notices. All notices, demands, or other communications to
be given or delivered under or by reason of the provisions of this Agreement shall be in
writing and shall be deemed to have been given or made when (a) delivered personally to
the recipient, (b) telecopied to the recipient (with hard copy sent to the recipient by
reputable overnight courier service (charges prepaid) that same day) if telecopied before
5:00 p.m. New York, New York time on a Business Day, and otherwise on the next
Business Day, or (c) one Business Day after being sent to the recipient by reputable
overnight courier service (charges prepaid). Such notices, demands, and other
communications shall be sent to the address for such recipient set forth in the LLCβs books
and records, or to such other address or to the attention of such other person as the recipient
party has specified by prior written notice to the sending party. Any notice to the Board or
the LLC shall be deemed given if received by the Board at the principal office of the LLC
designated pursuant to Section 2.7, and any such notice shall also be delivered to each of
the Principal Investors.
15.16. Creditors. None of the provisions of this Agreement shall be for the benefit
of or enforceable by any creditors of the LLC or any of their Affiliates (other than any
Affiliate in its capacity as a Unitholder and party hereto), and no creditor who makes a loan
to the LLC or any of its Affiliates may have or acquire (except pursuant to the terms of a
separate agreement executed by the LLC in favor of such creditor) at any time as a result
of making the loan any direct or indirect interest in LLC Profits, Losses, Distributions,
capital, or property other than as a secured creditor.
15.17. Waiver. No failure by any party to insist upon the strict performance of
any covenant, duty, agreement, or condition of this Agreement or to exercise any right or
remedy consequent upon a breach thereof shall constitute a waiver of any such breach or
any other covenant, duty, agreement, or condition. Notwithstanding the other provisions
of this Agreement, Section 18-305(a) of the Delaware Act shall not apply to the LLC and
no Unitholder shall have any rights thereunder.
15.18. Further Action. The parties shall execute and deliver all documents,
provide all information, and take or refrain from taking such actions as may be reasonably
necessary or appropriate to achieve the purposes of this Agreement.
15.19. Offset. Whenever the LLC is to pay any sum to any Unitholder or any
Affiliate or related person thereof, any amounts that such Unitholder or such Affiliate or
related person owes to the LLC may be deducted from that sum before payment; provided,
that (other than with respect to Section 4.6(g), which shall not be subject to this proviso)
with respect to the Rollover Holders, the LLC shall be permitted to offset such amounts
pursuant to this Section 15.19 if and to the extent that a court of competent jurisdiction has
issued a final, non-appealable ruling validating that such amounts are due and owing to the
LLC or to the extent that the Rollover Holders otherwise agree in writing.
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15.20. Entire Agreement. This Agreement, those documents expressly referred
to herein (including the Subscription Agreement and the Advisory Agreement) and the
other documents of even date herewith, embody the complete agreement and understanding
among the parties and supersede and preempt any prior understandings, agreements, or
representations by or among the parties, written or oral, which may have related to the
subject matter hereof in any way.
15.21. Delivery by Facsimile. This Agreement, the agreements referred to herein,
and each other agreement or instrument entered into in connection herewith or therewith
or contemplated hereby or thereby, and any amendments hereto or thereto, to the extent
signed and delivered by means of a facsimile machine or in βportable document formatβ,
shall be treated in all manner and respects as an original agreement or instrument and shall
be considered to have the same binding legal effect as if it were the original signed version
thereof delivered in person. At the request of any party hereto or to any such agreement or
instrument, each other party hereto or thereto shall re-execute original forms thereof and
deliver them to all other parties. No party hereto or to any such agreement or instrument
shall raise the use of a facsimile machine or βportable document formatβ to deliver a
signature or the fact that any signature or agreement or instrument was transmitted or
communicated through the use of a facsimile machine or electronic mail as a defense to the
formation or enforceability of a contract and each such party forever waives any such
defense.
15.22. Survival. Articles I and VII, and Sections 4.3, 6.1, 6.6, 6.7 6.8, 6.9, 6.11,
13.2, 15.2, 15.5, 15.6, 15.9, 15.10, 15.11, 15.12, 15.13, 15.14, 15.15, 15.16, 15.17, 15.20,
15.21 and this 15.22 shall survive and continue in full force in accordance with their terms
notwithstanding any termination of this Agreement or the dissolution of the LLC.
15.23. Deemed Transfer of Units. If the LLC or any other Person acquiring Units
of a Unitholder in accordance with the terms herein shall make available, at the time and
place and in the amount and form provided in such unit transfer or similar agreement (βUnit
Transfer Agreementβ), the consideration for the Units to be repurchased in accordance with
the provisions of such Unit Transfer Agreement, then from and after such time, the Person
from whom such Units are to be repurchased shall no longer have any rights (including
rights to Distributions hereunder) as a holder of such Units (other than the right to receive
payment of such consideration in accordance with such Unit Transfer Agreement), and
such Units shall be deemed purchased in accordance with the applicable provisions hereof
and the LLC or any other Person acquiring such Units shall be deemed the owner and
holder of such Units, whether or not the certificates therefor have been delivered as
required by such Unit Transfer Agreement.
15.24. Recapitalization. If any securities are issued in respect of, in exchange for,
or in substitution of, any Units by reason of any reorganization, recapitalization,
reclassification, merger, consolidation, spin-off, partial or complete liquidation, stock
dividend, split-up, sale of assets, distribution to stockholders or combination of the Units
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or any other change in capital structure of the LLC, in each case in accordance with the
terms herein, appropriate adjustments shall be made with respect to the relevant provisions
of this Agreement so as fairly and equitably to preserve, as far as practicable, the original
rights and obligations of the parties hereto under this Agreement.
15.25. Acknowledgement.
(a) Xxx Xxxxxxxx, the LLC and each of the Unitholders hereby agree
and acknowledge that for all purposes of this Agreement that (i) Xxx Xxxxxxxx and the Xxx
Xxxxxxxx Trust are to be deemed the same Person for all purposes under this Agreement,
(ii) any and all actions or omissions taken by Xxx Xxxxxxxx (including any actions or
omissions in connection with Xxx Xxxxxxxxβx employment with, or service to, the LLC or
any Subsidiary) shall be deemed actions or omissions taken by the Xxx Xxxxxxxx Trust
hereunder, (iii) any and all actions or omissions taken by the Xxx Xxxxxxxx Trust shall be
deemed actions or omissions taken by Xxx Xxxxxxxx hereunder, and (iv) any and all rights
and obligations of the Xxx Xxxxxxxx Trust are intended to, and shall, apply to and bind Xxx
Xxxxxxxx as if Xxx Xxxxxxxx owned directly the LLC Interests held by the Xxx Xxxxxxxx
Trust hereunder.
(b) Xxxxx Xxxxxxxx, the LLC and each of the Unitholders hereby agree
and acknowledge that for all purposes of this Agreement that (i) Xxxxx Xxxxxxxx and the
Xxxxx Xxxxxxxx Trust are to be deemed the same Person for all purposes under this
Agreement, (ii) any and all actions or omissions taken by Xxxxx Xxxxxxxx (including any
actions or omissions in connection with Xxxxx Xxxxxxxxβx employment with, or service to,
the LLC or any Subsidiary) shall be deemed actions or omissions taken by the Xxxxx
Xxxxxxxx Trust hereunder, (iii) any and all actions or omissions taken by the Xxxxx
Xxxxxxxx Trust shall be deemed actions or omissions taken by Xxxxx Xxxxxxxx hereunder,
and (iv) any and all rights and obligations of the Xxxxx Xxxxxxxx Trust are intended to, and
shall, apply to and bind Xxxxx Xxxxxxxx as if Xxxxx Xxxxxxxx owned directly the LLC
Interests held by the Xxxxx Xxxxxxxx Trust hereunder.
* * * * *
Β
[SIGNATURE PAGE TO LLC AGREEMENT]
IN WITNESS WHEREOF, the undersigned have executed or caused to be executed
on their behalf this Amended and Restated Limited Liability Company Agreement as of
the date first written above.
PROMETHEUS HOLDCO, LLC
By: The Providence Service Corporation,
Its sole and managing member
By: /s/ Xxxxx Xxxxxxxxxx
Name: Xxxxx Xxxxxxxxxx
Title: Chief Financial Officer
Β
[SIGNATURE PAGE TO LLC AGREEMENT]
MERCURY FORTUNA BUYER, LLC
By: /s/ Xxx X. Xxxxxxx
Name: Xxx X. Xxxxxxx
Title: President, Treasurer
Β
[SIGNATURE PAGE TO LLC AGREEMENT]
MERCURY Parent, LLC
By: /s/ Xxxx X. Xxxxxxx
Name: Xxxx X. Xxxxxxx
Title: General Counsel & Secretary
Β
[SIGNATURE PAGE TO LLC AGREEMENT]
XXXXX XXXXXXXX
By: /s/ X. Xxxxxxxx
Β
[SIGNATURE PAGE TO LLC AGREEMENT]
THE DIGNITY TRUST
By: /s/ Xxxxxxxx Xxxxxxxx, Trustee
Name: Xxxxxxxx Xxxxxxxx
Title: Trustee
Β
[SIGNATURE PAGE TO LLC AGREEMENT]
THE NOBILITY TRUST
By: /s/ Xxxxxxxx Xxxxxxxx, Trustee
Name: Xxxxxxxx Xxxxxxxx
Title: Trustee
Β
[SIGNATURE PAGE TO LLC AGREEMENT]
XXXXXXX XXXX
By: /s/ Xxxxx Xxxx
Β
[SIGNATURE PAGE TO LLC AGREEMENT]
XXXXX XXXXXXXX
By: /s/ Xxxxx Xxxxxxxx
Β
[SIGNATURE PAGE TO LLC AGREEMENT]
XXXXX XXXXXXXX
By: /s/ Xxxxx Xxxxxxxx
Β
