EXHIBIT 3.18
OPERATING AGREEMENT
OF
AMERIPATH INDIANA, LLC
This document constitutes the Operating Agreement (the "Agreement") of
AmeriPath Indiana, LLC (the "Company"), a limited liability company organized
pursuant to the Indiana Business Flexibility Act (the "Act"), and is adopted as
of the 31st day of December, 2002, by AmeriPath, Inc. in its capacity as the
sole member of the Company (the "Member") and the Company.
ARTICLE 1
FORMATION
1.1 ORGANIZATION. The Member hereby authorizes and ratifies the
formation of (he Company as an Indiana limited liability company pursuant to the
provisions of the Act effective on the date of the filing of the Articles of
Organization of the Company (the "Articles") with the Indiana Secretary of
State.
1.2 REGISTERED AGENT AND OFFICE. The registered agent for the service of
process and the registered office shall be that person and location reflected in
the Articles as filed with the Indiana Secretary of State. The Company may, from
time to time, change the registered agent or office through appropriate filings
with the Secretary of State. In the event the registered agent ceases to act as
such for any reason or the registered office shall change, the Company shall
promptly designate a replacement registered agent or file a notice of change of
address as the case may be.
1.3 BUSINESS. The business of the Company shall be:
(a) To provide, through its licensed physician employees,
professional anatomic and clinical pathology services.
(b) To pursue any lawful business whatsoever, or which shall at any
time appear conducive to or expedient for the benefit of the Company or the
protection of its assets.
(c) To exercise all powers which may be legally exercised under the
Act.
(d) To engage in any activities reasonably necessary or convenient
to the foregoing.
ARTICLE 2
MANAGEMENT
2.1 MANAGEMENT. The business and affairs of the Company shall be managed
by the Member. The Member shall direct, manage and control the business of the
Company. The Member shall have full and complete authority, power and discretion
to manage and control the business, affairs and properties of the Company, to
make all decisions regarding those matters and to perform any and all other acts
or activities customary or incident to the management of the Company's business
including, without limitation, the right and power to appoint individuals to
serve as officers ("Officers") of the Company and to delegate authority to such
Officers.
2.2 OFFICERS. The Member is hereby authorized to appoint Officers and
delegate authority to such Officers to implement the decisions of the Member,
including, but not limited to, the administration of the day-to-day business of
the Company and, subject to the other provisions of this Agreement, the
administration of the ordinary and usual business affairs of the Company, and
the Officers so appointed shall be responsible for such implementation. Except
as expressly provided to the contrary in this Agreement, and except as otherwise
directed by the Member, the Officers are authorized to make decisions relating
to the day-to-day affairs of the Company and to implement such decisions. In
addition, the Member is hereby authorized to delegate to the Officers such
responsibilities as deemed appropriate by the Member, including, but not limited
to, the right to execute and deliver instruments on behalf of the Company. The
initial Officers of the Company shall be as follows:
Xxxxx X. New President
Xxxxxxx X. Xxxxx Vice President, Secretary and Treasurer
Xxxxx X. Xxxxxxxxxx Vice President
2.3 REMOVAL OF OFFICERS. Any Officer may be removed by the Member at any
time, by written notice of such removal given without any prior notice or
warning, for any reason whatsoever, and the Member shall appoint such Officer's
successor.
2.4 COMPENSATION FOR SERVICES. Compensation of Officers shall be as
approved by the Member.
2.5 LIABILITY OF THE MEMBER AND OFFICERS.
2.5.1 No Member or Officer shall be liable to the Company or to
the Member, in damages or otherwise, for any action taken or failure to act on
behalf of the Company, unless the act or omission constitutes willful misconduct
or recklessness.
2.5.2 If the Act is hereafter amended to authorize the further
elimination or limitation of the liability of members or officers, then the
liability of the Member and Officers, in addition to the limitation on liability
provided herein, shall be limited to the fullest extent permitted by the amended
Act. In the event that any of the provisions of this Section 2.5 (including any
provision within a single sentence) is held by a court of
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competent jurisdiction to be invalid, void or otherwise unenforceable, the
remaining provisions arc severable and shall remain enforceable to the fullest
extent permitted by law.
ARTICLE 3
RIGHTS AND OBLIGATIONS OF THE MEMBER
3.1 LIMITATION ON MEMBER'S LIABILITIES. The Member's liability shall be
limited as set forth in this Agreement, the Act and other applicable law. The
Member shall not be bound by, or be personally liable for, the expenses,
liabilities or obligations of the Company beyond the amount contributed by the
Member to the capital of the Company, except as provided by Section 23-18-5-7 of
the Act with regard to unlawful distributions.
3.2 VOTING RIGHTS. Except as otherwise specifically set forth in this
Agreement, the Member shall have only the voting rights set forth in the Act,
3.3 ACTION BY MEMBER WITHOUT A MEETING. Any action required or permitted
to be taken by the Member may be taken with or without a meeting, and, except as
set forth in Section 9.2(a), with or without any written consents or other
writings describing the action taken.
3.4 TRANSFERS. Except as set forth in Section 9,2(a), the Member is free
to sell, assign, convey, gift, pledge or otherwise transfer or encumber its
entire interest in the Company without restriction. Any transferee of such
interest will have the rights and powers, and be subject to the restrictions and
liabilities of a member under the Articles of Organization, this Agreement and
any amendments or restatements thereof, and the Act, A member who transfers its
entire interest in the Company will cease to be a member and may no longer
exercise any rights of a member and will not be subject to any duties or
obligations of a member.
ARTICLE 4
CONTRIBUTIONS
4.1 INITIAL CONTRIBUTIONS. The Member shall make an initial capital
contribution in the amount of $1,000. The Member shall not be required to make
additional capital contributions.
4.2 MEMBER LOANS. The Member may lend funds to the Company. The
repayment terms and interest rate for such loans shall be established by the
Member; provided, however, that in no event shall the interest rate on such
loans be less than the applicable federal rate as announced by the Internal
Revenue Service and in effect on the date the loan is made.
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4.3 RETURN OF CAPITAL CONTRIBUTIONS. Except as otherwise provided in
this Agreement, the Member shall be entitled to a return of its capital
contributions only upon the dissolution and winding up of the Company as
provided in Article 7.
ARTICLE 5
ALLOCATIONS AND DISTRIBUTIONS
5.1 ALLOCATIONS OF PROFITS AND LOSSES. Profits, losses and other items
of income, gain, deduction and credit shall be allocated to the Member.
5.2 DISTRIBUTIONS. All cash available for distribution shall be
distributed to the Member at such times and in such amounts as determined by the
Member. However, no distributions may be declared or paid if, after giving
effect thereto, either (a) the Company would not be able to pay its debts as
they become due in the ordinary course of business; or (b) the Company's total
assets would be less than its total liabilities.
ARTICLE 6
BOOKS AND RECORDS
6.1 AVAILABILITY. At all times during the existence of the Company, the
Member shall keep or cause to be kept complete and accurate books and records
appropriate and adequate for the Company's business. Such books and records,
whether financial, operational or otherwise and including a copy of this
Agreement and any amendments, shall at all times be maintained at the principal
place of business of the Company. The Member or such Member's duly authorized
representative shall have the right at any time, for any purpose reasonably
related to such Member's ownership interest, to inspect and copy from such books
and records during normal business hours. Except as stated in this Section 6,1,
the provisions of Section 23-18-4-8 of the Act shall not apply.
6.2 TAX RETURNS. The Member shall cause an accountant to prepare all tax
returns which the Company is required to file, if any, and shall file with the
appropriate taxing authorities all such returns in a manner required for the
Company to be in compliance with any law governing the timely filing of such
returns.
6.3 DEPOSITORIES. The Member shall maintain or cause to be maintained
one or more accounts for the Company in such depositories as the Member shall
select. All receipts of the Company from whatever source received (but no funds
not belonging to the Company) shall be deposited to such accounts, and all
expenses of the Company shall be paid from such accounts. Unless otherwise
determined by the Member, all signatories on any such account shall be bonded
under a blanket commercial bond insuring the Company against loss, and such
accounts shall be insured against loss from forgery.
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ARTICLE 7
DISSOLUTION AND WINDING UP
7.1 EVENTS CAUSINE DISSOLUTION.
(a) The Company shall be dissolved and its affairs wound up at
such time as the Member determines that the Company should be dissolved, or upon
entry of a decree Judicial dissolution.
(b) Notwithstanding the provisions of Section 23-18-9.1(c) of
the Act, if at any time there are no members of the Company, the personal
representative of the last remaining member may elect, within ninety (90) days
of the occurrence of the event that caused there to be no members, to continue
the business of the Company and to consent to the admission of the personal
representative or the personal representative's designee to the Company as a
member, to be effective at the time of the event that caused the last remaining
member to cease to be a member.
7.2 LIQUIDATION OF PROPERTY AND APPLICATION OF PROCEEDS.
7.2.1 WINDING UP. Upon the dissolution of the Company, the Member
shall wind up the Company's affairs in accordance with the Georgia Act. In
winding up the affairs of the Company, the Member is authorized to take any and
all actions contemplated by the Act as permissible, including, without
limitation:
(i) collecting its assets;
(ii) disposing of properties that will not be distributed
in kind to the Member;
(iii) discharging or making provision for discharging the
Company's liabilities;
(iv) distributing the remaining property to the Member; and
(v) doing every other act necessary to wind up and
liquidate the Company's business and affairs.
7.2.2 DISTRIBUTION OF PROCEEDS. Upon the winding up of the
Company, the Member shall distribute the proceeds and undisposed property as
follows:
(i) to creditors, including the Member if the Member is a
creditor (to the extent and in the order of priority provided by law) in
satisfaction of liabilities of the Company, whether by payment or the making of
reasonable provisions for payment thereof; and
(ii) thereafter, to the Member.
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ARTICLE 8
INDEMNIFICATION
8.1 INDEMNIFICATION OF THE MEMBER, OFFICERS AND ORGANIZERS. To the
greatest extent not inconsistent with the laws and public policies of Indiana,
the Company shall indemnify any Member, officer, and organizer (any such Member,
or organizer, who is a person, and any responsible officers, partners,
shareholders, directors, or managers of such Member or organizer which is an
Entity, hereinafter being referred to as the indemnified "individual") made a
party to any proceeding because such individual is or was a Member, Officer, or
organizer as a matter of right, against all liability incurred by such
individual in connection with any proceedings; provided that it shall be
determined in the specific case in accordance with Section 8,4 of this Article
that indemnification of such individual is permissible in the circumstances
because the individual has met the standard of conduct for indemnification set
forth in Section 8.3 of this Article. The Company shall pay for or reimburse the
reasonable expenses incurred by a Member, Officer, or organizer in connection
with any such proceeding in advance of final disposition thereof if (i) the
individual furnishes the Company a written affirmation of the individual's good
faith belief that he or she has met the standard of conduct for indemnification
described in Section 8.3 of this Article, (ii) the individual furnishes the
Company a written undertaking, executed personally or on such individual's
behalf, to repay the advance if it is ultimately determined that such individual
did not meet such standard of conduct, and (iii) a determination is made in
accordance with Section 8.4 that based upon facts then known to those making the
determination, indemnification would not be precluded under this Article. The
undertaking described in subparagraph (ii) above must be a general obligation of
the individual, subject to such reasonable limitations as the Company may
permit, but need not be secured and may be accepted without reference to
financial ability to make repayment. The Company shall indemnify a Member,
Officer, or organizer who is wholly successful, on the merits or otherwise, in
the defense of any such proceeding, as a matter of right, against reasonable
expenses incurred by the individual in connection with the proceeding without
the requirement of a determination as set forth in Xxxxxxx X,0 of this Article.
Upon demand by a Member, Officer or organizer for indemnification or advancement
of expenses, as the case maybe, the Company shall expeditiously determine
whether the Member, Officer or organizer is entitled thereto in accordance with
this Article. The indemnification and advancement of expenses provided for under
this Article shall be applicable to any proceeding arising from acts or
omissions occurring before or after the adoption of this Article.
8.2 INDEMNIFICATION, OF EMPLOYEES. The Company shall have the power, but
not the obligation, to indemnify any individual who is or was an employee or
agent of the Company to the same extent as if such individual was a Member
Officer, or organizer.
8.3 STANDARD OF CONDUCT FOR INDEMNIFICATION. Indemnification of an
individual is permissible under this Article only if (i) such individual
conducted himself or herself in good faith, (ii) such individual reasonably
believed that his or her conduct was in or at least not opposed to the Company's
best interest, and (iii) in the case of any criminal proceeding, such individual
had no reasonable cause to believe his or her
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conduct was unlawful. Indemnification is not permissible against liability to
the extent such liability is the result of willful misconduct, or recklessness,
or any improperly obtained financial or other benefit to which the individual
was not legally entitled. The termination of a proceeding by judgment, order,
settlement, conviction or upon a plea of nolo contendere or its, equivalent is
not, of itself determinative that the individual did not meet the standard of
conduct described in this Section 8.3.
8.4 DETERMINATION OF PERMISSIBLE INDEMNIFICATION. A determination as to
whether indemnification or advancement of expenses is permissible shall be made
by any one of the following procedures:
(a) By the Member if the Member is not a party to the
proceeding; or
(b) By special legal counsel selected by the Member.
8.5 DETERMINATION BY COURT. A Member, Officer, or organizer of the
Company who is party to a proceeding may apply for indemnification from the
Company to the court, IF ANY, conducting the proceeding or to another court of
competent jurisdiction. On receipt of an application, the court, after giving
notice the court considers necessary, may order indemnification if it
determines:
(a) In a proceeding in which the Member, Officer, or organizer
is wholly successful, on the merits or otherwise, the Member, Officer, or
organizer is entitled to indemnification under this Article, in which case the
court shall order the Company to pay the individual his or her reasonable
expenses incurred to obtain such court ordered indemnification; or
(b) The individual is fairly and reasonably entitled to
indemnification in view of all the relevant circumstances, whether or not the
individual met the standard of conduct set forth in Section 8.3 of this Article.
8.6 EMPLOYEE BENEFIT PLANS. Indemnification shall also be provided for
an individual's conduct with respect to an employee benefit plan if the
individual reasonably believed his or her conduct to be in the interests of the
participants in and beneficiaries of the plan.
8.7 NON-EXCLUSIVE PROVISION. Nothing contained in this Article shall
limit or preclude the exercise, or be deemed exclusive of, any right under the
law, by contract or otherwise, relating to indemnification of or advancement of
expenses to any individual who is or was a Member, Officer, or organizer of the
Company or is or was serving at the Company's request as a director, officer,
partner, manager, trustee, employee, or agent of another foreign or domestic
company, partnership, association, limited liability company, corporation, joint
venture, trust, employee benefit plan, or other enterprise, whether for- profit
or not. Nothing contained in this Article shall limit the ability of the Company
to otherwise indemnify or advance expenses to any individual. It is the intent
of this Article to provide indemnification to Members, Officers, or organizers
to the fullest extent now
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or hereafter permitted by the law consistent with the terms and conditions of
this Article. If indemnification is permitted under this Article,
indemnification shall be provided in accordance with this Article irrespective
of the nature of the legal or equitable theory upon which a claim is asserted,
including without limitation, negligence, breach of duty, waste, breach of
contract, breach of warranty, strict liability, violation of federal or state
securities law, violation of the Employee Retirement Income Security Act of
1974, as amended, or violation of any other state or federal law.
8.8 INSURANCE. The Company may purchase and maintain insurance for its
benefit, the benefit of any individual who is entitled to indemnification under
this Article 8, or both, against any liability asserted against or incurred by
such individual in any capacity or arising out of such individual service with
the Company, whether or not the Company would have the power to indemnify such
individual against such liability.
8.9 DEFINITIONS. For purposes of this Article:
(a) The term "expenses" includes all direct and indirect costs
(including without limitation counsel fees, retainers, court costs, transcripts,
fees of experts, witness fees, travel expenses, duplicating costs, printing and
binding costs telephone charges, postage, delivery service fees, and all other
disbursement or out-of-pocket expenses) actually incurred in connection with
the investigation, defense, settlement, or appeal of a proceeding or
establishing or enforcing a right to indemnification under this Article,
applicable law or otherwise.
(b) The term "liability" means the obligation to pay a judgment,
settlement, penalty, fine, excise tax (including an excise tax assessed with
respect to an employee benefit plan), or reasonable expenses incurred with
respect to a proceeding.
(c) The term "party" includes an individual who was, is, or is
threatened to be made a named defendant or respondent in a proceeding.
(d) The term "proceeding" means, any threatened, pending, or
completed action, suit, or proceeding, whether civil, criminal, administrative,
or investigative and whether formal or informal.
ARTICLE 9
MISCELLANEOUS PROVISIONS
9.1 RIGHTS OF CREDITORS AND THIRD PARTIES UNDER THIS AGREEMENT. This
Agreement is adopted by the Member for the exclusive benefit of the Company, the
Member, and their successors and assigns. This Agreement is expressly not
intended for the benefit of any creditor of the Company or any other person.
Except and only to the extent provided by applicable statute, no such creditor
or third party shall have any rights under this Agreement.
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9.2 TAX CLASSIFICATION. It is the Member's express intention that, in
accordance with Treasury Regulations Sections 301.7701-2 and 301.7701-3 and
corresponding provisions of applicable state tax laws (and any successor
provisions), the Company be disregarded as an entity separate from the Member
for all income and franchise tax purposes. To that end:
(a) The Member and the Company will take no action that would
terminate the Company's eligibility to be a disregarded entity ("Contrary
Action") absent a written statement of consent by the Member to act in
contravention of such intentions after consultation with its tax advisors as to
any potential adverse tax consequences of the Contrary Action. Any Contrary
Action taken by the Member or the Company that is not accompanied by a written
statement of consent by the Member to proceed notwithstanding the conflict
between the Contrary Action and the intentions expressed in this Section 9/2
shall be null and void, and of no force or effect whatsoever. The Company shall
not record on its books any purported issuance of an additional membership
interest or any purported transfer of the membership interest that is a Contrary
Action not permitted under this Agreement after taking into account the
provisions of this Section 9.2(a).
(b) For any period that the Company is disregarded, all of the
Company's items of income, gain, deduction, loss, and credit, will be included
directly in the federal (and applicable state) income and franchise tax returns
of the Member as if the Company were a branch or division of the Member.
9.3 HEADINGS. Section and other headings contained in this Agreement arc
for reference purposes only and are not intended to describe, interpret, define
or limit the scope, extent or intent of any provision of this Agreement.
9.4 INDIANA LAW CONTROLLING. The laws of the State of Indiana, including
the Act, shall govern the validity of this Agreement, the construction of its
terms and the interpretation of the rights and duties of the parties hereto.
9.5 AMENDMENT. This Agreement shall be amended only with the written
consent of the Member.
[SIGNATURES ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, this Operating Agreement has been adopted and executed
by the Member and the Company as of the date first above written.
MEMBER:
AMERIPATH, INC.
By: /s/ XXXXXXX X. XXXXX
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Name: XXXXXXX X. XXXXX
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Title: VP
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COMPANY:
AMERIPATH INDIANA, LLC
By: AmeriPath, Inc., its sole Member
By: /s/ XXXXXXX X. XXXXX
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Name: XXXXXXX X. XXXXX
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Title: VP
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