AMENDED AND RESTATED LIMITED
LIABILITY COMPANY AGREEMENT
OF
MAIN PLACE FUNDING, LLC
A Delaware Limited Liability Company
(formerly Main Place Holdings, LLC)
Dated as December 14, 1998
TABLE OF CONTENTS
ARTICLE I....................................................................................6
DEFINITIONS...............................................................................6
Section 1.1 DEFINITIONS................................................................6
ARTICLE II...................................................................................8
ORGANIZATION..............................................................................8
Section 2.1 FORMATION..................................................................8
Section 2.2 CERTIFICATE OF FORMATION; FOREIGN QUALIFICATION............................8
Section 2.3 NO STATE LAW PARTNERSHIP; LIABILITY TO THIRD PARTIES.......................9
ARTICLE III..................................................................................9
PURPOSES AND POWERS, PRINCIPAL OFFICE, REGISTERED.........................................9
Section 3.1 PURPOSES AND POWERS........................................................9
Section 3.2 PRINCIPAL OFFICE..........................................................10
Section 3.3 REGISTERED AGENT AND OFFICE...............................................10
Section 3.4 PERIOD OF DURATION........................................................10
ARTICLE IV..................................................................................10
MEMBERSHIP AND DISPOSITIONS OF INTERESTS.................................................10
Section 4.1 MEMBERS...................................................................10
Section 4.2 ELIMINATION OF PREEMPTIVE RIGHTS..........................................10
Section 4.3 RESIGNATION...............................................................10
Section 4.4 RESTRICTION ON THE DISPOSITION OF THEMEMBERSHIP INTEREST..................10
Section 4.5 BANKRUPT MEMBER; CONTINUATION............................................11
Section 4.6 TWO MEMBERS REQUIRED......................................................12
Section 4.7 OTHER ACTIVITIES OF THE MEMBERS AND THEIR AFFILIATES......................12
ARTICLE V...................................................................................12
CAPITAL CONTRIBUTIONS....................................................................12
Section 5.1 INITIAL CAPITAL...........................................................12
Section 5.2 ADDITIONAL CAPITAL........................................................12
Section 5.3 RETURN OF CONTRIBUTIONS...................................................12
ARTICLE VI..................................................................................13
PROFITS, LOSSES, ACCOUNTING, TAXES AND DISTRIBUTION......................................13
Section 6.1 ALLOCATION OF PROFITS AND LOSSES..........................................13
Section 6.2 BOOKS; FISCAL YEAR; ACCOUNTING TERMS......................................13
Section 6.3 CAPITAL ACCOUNTS..........................................................13
Section 6.4 DISTRIBUTIONS.............................................................13
Section 6.5 TAX RETURNS...............................................................13
Section 6.6 TAX MATTERS PARTNER.......................................................13
Section 6.7 WITHDRAWALS...............................................................14
Section 6.8 BANKING..................................................................14
Section 6.9. TAX CLASSIFICATION.......................................................14
ARTICLE VII.................................................................................14
MANAGEMENT, LIABILITY OF MEMBERS,........................................................14
Section 7.1 MANAGING MEMBER...........................................................14
Section 7.2 POWERS OF THE MANAGING MEMBER.............................................14
Section 7.3 ACTIONS REQUIRING CONSENT.................................................15
Section 7.4 OFFICERS..................................................................17
Section 7.5 INDEMNIFICATION...........................................................18
Section 7.6 EXCULPATION; DUTIES.......................................................18
Section 7.7 VIOLATION OF THIS AGREEMENT...............................................19
Section 7.8 EXECUTION OF INSTRUMENTS..................................................19
Section 7.9 SCHEDULED DUTIES AND COMPENSATION.........................................19
ARTICLE VIII................................................................................20
DISSOLUTION, LIQUIDATION AND TERMINATION OF THE COMPANY..................................20
Section 8.1 DISSOLUTION...............................................................20
Section 8.2 LIQUIDATION AND TERMINATION...............................................20
Section 8.3 PAYMENT OF DEBTS.........................................................20
Section 8.4 REMAINING DISTRIBUTION....................................................20
Section 8.5 RESERVE...................................................................20
Section 8.6 FINAL ACCOUNTING..........................................................21
ARTICLE IX..................................................................................21
AMENDMENTS...............................................................................21
Section 9.1 AUTHORITY TO AMEND........................................................21
ARTICLE X...................................................................................21
POWER OF ATTORNEY........................................................................21
Section 10.1 POWER....................................................................21
Section 10.2 SURVIVAL OF POWER........................................................22
ARTICLE XI..................................................................................22
SEPARATE LEGAL ENTITY....................................................................22
Section 11.1 SEPARATE LEGAL ENTITY....................................................22
ARTICLE XII.................................................................................23
MISCELLANEOUS............................................................................23
Section 12.1 METHOD OF GIVING CONSENT.................................................23
Section 12.2 GOVERNING LAW............................................................23
Section 12.3 AGREEMENT FOR FURTHER EXECUTION..........................................24
Section 12.4 ENTIRE AGREEMENT.........................................................24
Section 12.5 SEVERABILITY.............................................................24
Section 12.6 NOTICES..................................................................24
Section 12.7 COUNTERPARTS.............................................................24
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Section 12.8 WAIVER OF PARTITION......................................................24
Section 12.9 PRONOUNS.................................................................24
Section 12.10 TITLES AND CAPTIONS.....................................................24
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AMENDED AND RESTATED LIMITED
LIABILITY COMPANY AGREEMENT
OF
MAIN PLACE FUNDING, LLC
A Delaware Limited Liability Company
(formerly Main Place Holdings, LLC)
THIS AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT
(this "Agreement") is executed as of the 14th day of December, 1998 by the
undersigned, the sole members, to continue a limited liability company under the
laws of the State of Delaware for the purposes and upon the terms and conditions
hereinafter set forth.
RECITALS
1. WHEREAS, NationsBank, N.A. ("NationsBank" or the "Managing Member")
has heretofore been the sole member of the Company pursuant to the original
Limited Liability Agreement of the Company (the "Original Agreement");
2. WHEREAS, Main Place Trust (the "Trust" or the "Special Managing
Member") has on the date hereof acquired a Membership Interest and been admitted
as a Member of the Company pursuant to an Assignment and Assumption Agreement
between NationsBank and the Trust;
3. WHEREAS, NationsBank and the Trust, as the sole members of the
Company, desire to amend and restate the Original Agreement in order to reflect
the admission of the Trust as a Member of the Company, to reflect the new name
of the Company as "Main Place Funding, LLC," and to make certain other changes
in connection with the merger of Main Place Real Estate Investment Trust with
and into the Company; and
4. WHEREAS, each of NationsBank and the Trust desire that this
Agreement be, and it hereby is, the sole governing document of the Company,
superseding all prior agreements.
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ARTICLE I
DEFINITIONS
Section 1.1 DEFINITIONS. Whenever used in this Agreement the
following terms shall have the meanings respectively assigned to them in this
Article I unless otherwise expressly provided herein or unless the context
otherwise requires:
ACT: "Act" shall mean the Delaware Limited Liability Company Act,
6 Del.C. xx.xx. 18-101 et seq., as amended from time to time.
AFFILIATE: "Affiliate" of another Person shall mean any Person
directly or indirectly controlling, controlled by, or under common control with,
such other person.
AGREEMENT: "Agreement" shall mean this Amended and Restated
Limited Liability Company Agreement of the Company as the same may be amended or
restated from time to time in accordance with its terms.
ASSIGNEE: "Assignee" shall mean a Person who has acquired a share
of the Company's profits and losses and such rights to receive distributions
from the Company as are assigned to that Person, but who is not a Substitute
Member.
BANKRUPT MEMBER: "Bankrupt Member" shall mean any Member (a) that
(i) makes an assignment for the benefit of creditors; (ii) files a voluntary
petition in bankruptcy; (iii) is adjudged a bankrupt or insolvent, or has
entered against such Member an order for relief, in any bankruptcy or insolvency
proceedings; (iv) files a petition or answer seeking for such Member any
reorganization, arrangement, composition, readjustment, liquidation, dissolution
or similar relief under any statute, law or regulation; (v) files an answer or
other pleading admitting or failing to contest the material allegations of a
petition filed against such Member in any proceeding of the type described in
subclauses (i) through (iv) of this clause (a); or (vi) seeks, consents to, or
acquiesces in the appointment of a trustee, receiver or liquidator of such
Member or of all or any substantial part of such Member's properties; or (b)
against which, a proceeding seeking reorganization, arrangement, composition,
readjustment, liquidation, dissolution, or similar relief under any statute, law
or regulation has been commenced and one hundred twenty (120) days have expired
without dismissal thereof or with respect to which, without such Member's
consent or acquiescence, a trustee, receiver or liquidator of such Member or of
all or any substantial part of such Member's properties has been appointed and
ninety (90) days have expired without the appointment having been vacated or
stayed, or ninety (90) days have expired after the date of expiration of a stay,
if the appointment has not previously been vacated. The foregoing is intended to
and shall supersede and replace the events of bankruptcy described in Sections
18-304(a) and (b) of the Act.
BONDS: "Bonds" shall have the meaning specified in Section
3.1(a)(vii).
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BOND DOCUMENTS: "Bond Documents" shall mean any outstanding
Bonds, the indentures pursuant to which such Bonds were issued and the related
agreements contemplated thereby.
CAPITAL ACCOUNT: "Capital Account" shall mean, as to the Member,
the account established and maintained for such Member pursuant to Article VI
hereof.
CAPITAL CONTRIBUTION: "Capital Contribution" shall mean the
amount in cash or property contributed by each Member (or its predecessors in
interest) to the capital of the Company for such Member's Membership Interest.
CODE: "Code" shall mean the Internal Revenue Code of 1986, as
amended.
COMPANY: "Company" shall mean Main Place Funding, LLC, the
Delaware limited liability company (formerly known as Main Place Holdings, LLC)
continued pursuant to the Act and this Agreement.
DISPOSE, DISPOSING or DISPOSITION: "Dispose," "Disposing" or
"Disposition" shall mean a sale, assignment, transfer, exchange, mortgage,
pledge, grant of a security interest, or other disposition or encumbrance
(including, without limitation, by operation of law), or any act thereof.
INDEPENDENT REPRESENTATIVE: "Independent Representative" shall
mean a trustee of the Trust who is not at the time of appointment and has not
been at any time during the preceding five (5) years: (i) a direct or indirect
legal or beneficial owner (beyond a nominal amount) in the Trust or any of its
affiliates; (ii) a creditor, supplier, employee, officer, director, family
member, manager, or contractor of the Trust or any of its affiliates; or a
person who controls (whether directly, indirectly, or otherwise) the Trust or
its affiliates or any creditor, supplier, employee, officer, director, manager,
or contractor of the Trust or its affiliates. As used herein, the following
terms shall have the following meanings: "control" means the possession,
directly or indirectly, of the power to direct or cause the direction of
management, policies or activities of a person or entity, whether through
ownership of voting securities, by contract or otherwise; "person" means a
natural person, corporation or other entity, government, or political
subdivision, agency, or instrumentality of a government; and an "affiliate" of a
person is a person that directly, or indirectly through one or more
intermediaries, controls or is controlled by, or is under common control with,
the person specified. Notwithstanding the foregoing, an Independent
Representative may serve in similar capacities for other "special purpose"
corporations formed by NationsBank or any affiliate thereof.
IRS: "IRS" shall mean the Internal Revenue Service.
MANAGING MEMBER: "Managing Member" shall mean NationsBank and any
successor Managing Member appointed pursuant to this Agreement, each in its
capacity as the managing member of the Company.
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MEMBER: "Member" shall mean each of NationsBank and the Trust,
and any Person hereafter admitted to the Company as a member as provided in this
Agreement, each in its capacity as a member of the Company.
MEMBERSHIP INTEREST: "Membership Interest" shall mean the limited
liability company interest of each Member in the Company, including, without
limitation, rights in the capital of the Company, rights to receive
distributions (liquidating or otherwise) and allocations of profits and losses.
For purposes of this Agreement, NationsBank's Membership Interest is ninety-nine
percent (99%) and the Trust's Membership Interest is one percent (1%).
PERSON: "Person" shall have the meaning given that term in
Section 18-102(12) of the Act.
SUBSTITUTE MEMBER: "Substitute Member" shall mean any Person to
whom a Membership Interest in the Company has been transferred and who was not a
Member immediately prior to such transfer and who has been admitted to the
Company as a Member pursuant to and in accordance with the provisions of Article
IV of this Agreement.
ARTICLE II
ORGANIZATION
Section 2.1 FORMATION. Each of NationsBank and the Trust hereby
execute this Agreement for the purpose of setting forth the rights and
obligations of the Members.
Section 2.2 CERTIFICATE OF FORMATION; FOREIGN QUALIFICATION. The
Certificate of Formation of the Company was filed for record in the office of
the Secretary of State of the State of Delaware on October 15, 1998, in
accordance with the Act. A Certificate of Amendment to the Certificate of
Formation of the Company was filed for record in the office of the Secretary of
State of the State of Delaware on December 10, 1998, in accordance with the Act,
for the purpose of renaming the Company. Prior to the Company's conducting
business in any jurisdiction other than the State of Delaware, the Managing
Member of the Company shall cause the Company to comply, to the extent
procedures are available and those matters are reasonably within the control of
the Managing Member, with all requirements necessary to qualify the Company as a
foreign limited liability company in that jurisdiction. At the request of the
Managing Member of the Company, each Member 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 qualifications of the Company as a foreign limited liability company in all
such jurisdictions in which the Company may conduct business. The Managing
Member is hereby designated as an authorized person, with the meaning of the
Act, to execute, deliver and file, to cause the execution, delivery and filing
of, all certificates (and any amendments and/or restatements thereof) required
or permitted by the Act to be filed in the office of the Secretary of State of
the State of Delaware.
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Section 2.3 NO STATE LAW PARTNERSHIP; LIABILITY TO THIRD PARTIES.
The Members intend that the Company not be a partnership (including, without
limitation, a limited partnership) or joint venture, and that no Member be a
partner or joint venturer of any other Member, for state law purposes, and that
this Agreement not be construed to suggest otherwise. This provision does not
reflect the federal or state tax classification of the Company. Except as
otherwise specifically provided in the Act, no Member shall be liable for the
debts, obligations or liabilities of the Company or any other Member, including
under a judgment, decree or order of a court.
ARTICLE III
PURPOSES AND POWERS, PRINCIPAL OFFICE, REGISTERED
AGENT, PERIOD OF DURATION AND MEMBER LIST
Section 3.1 PURPOSES AND POWERS. The Company has been formed for
the following purposes: (a) to purchase or otherwise acquire, own, hold, sell,
transfer, assign, pledge, finance, refinance and otherwise deal with (i)
mortgage loans, certificates or other securities guaranteed by the Government
National Mortgage Association, (ii) mortgage loans, certificates or other
securities issued or guaranteed by the Federal National Mortgage Association,
(iii) mortgage loans, certificates or other securities issued or guaranteed by
the Federal Home Loan Mortgage Corporation, (iv) deeds of trust, mortgage loans,
mortgage pass-through certificates or collateralized mortgage obligations issued
by any person or entity or other types of mortgage-related securities including
residual interest, (v) direct obligations of, and obligations fully guaranteed
by, the United States of America or any agency or instrumentality of the United
States the obligations of which are backed by the full faith and credit of the
United States of America, (vi) certificates representing interests in the
principal and/or interest payable on any of the foregoing and (vii) such other
securities and investments as may be permitted by or acceptable to the
applicable nationally-recognized statistical rating agency or agencies in
connection with issuance, offer and sale by the Company of one or more series of
Mortgage-Backed Bonds (the "Bonds") collateralized by any of the foregoing,
related property and/or collections and proceeds in respect thereof; (b) to
issue debt subordinated to the Bonds in connection with the acquisition of
collateral for the Bonds; provided, however, that the acts and activities and
exercise of any powers permitted in subsections (a) and (b) of this Section 3.1
require the prior written affirmation of the nationally-recognized statistical
rating agency or agencies which rate any outstanding series of Bonds that any
such activities will not result in a downgrade, qualification or withdrawal of
rating or ratings assigned to such Bonds; and (c) to engage in any activity and
to exercise any powers permitted to limited liability companies under the laws
of the State of Delaware that are incident to foregoing and necessary or
convenient to accomplish the foregoing. The Company shall not engage in any
activities other than as permitted by this Section 3.1.
Notwithstanding any other provision of this Agreement to the
contrary, the Company and the Managing Member, on behalf of the Company, shall
have the power to
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merge the Company with and into Main Place Real Estate Investment Trust with the
Company as the surviving entity.
Section 3.2 PRINCIPAL OFFICE. The initial principal office of the
Company is located at 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000.
The principal office of the Company may be relocated from time to time by
determination of the Managing Member.
Section 3.3 REGISTERED AGENT AND OFFICE. The registered agent for
service of process on the Company in the State of Delaware shall be the
Corporation Trust Company, and the address of such agent and the registered
office of the Company, 0000 Xxxxxx Xxxxxx in the City of Wilmington, County of
Xxx Xxxxxx, Xxxxx xx Xxxxxxxx 00000.
Section 3.4 PERIOD OF DURATION. The term of the Company shall
continue in perpetuity, unless the Company is earlier dissolved pursuant to law
or the provisions of this Agreement.
ARTICLE IV
MEMBERSHIP AND DISPOSITIONS OF INTERESTS
Section 4.1 MEMBERS. NationsBank and the Trust are the sole
members of the Company as of the date hereof. NationsBank was admitted to the
Company effective as of the formation of the Company, and the Trust has been
admitted to the Company effective as of the date hereof pursuant to an
Assignment and Assumption Agreement between NationsBank and the Trust.
Section 4.2 ELIMINATION OF PREEMPTIVE RIGHTS. No Member shall be
entitled as such, as a matter of right, to subscribe for or purchase interests
in the Company of any class, now or hereafter authorized.
Section 4.3 RESIGNATION. Except as otherwise provided in this
Agreement, a Member does not have the right or power to resign from the Company
as a Member.
Section 4.4 RESTRICTION ON THE DISPOSITION OF THE MEMBERSHIP
INTEREST. (a) Subject to compliance with all applicable provisions of this
Section 4.4, any Member may Dispose of all or any part of its Membership
Interest. The Person to whom such Disposition is made shall be an Assignee of
such interest but shall not be a Substitute Member unless admitted as a
Substitute Member in accordance with Section 4.4(b).
(b) The Person to whom a Disposition is made as described in
Section 4.4(a) shall have the right to become a Substitute Member only if (i)
the Member making such Disposition grants the transferee the right to be a
Substitute Member (which grant (subject to the following clause (ii)) is hereby
permitted) and (ii) such admission as a Substitute Member is consented to by all
of the Members.
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(c) The Company shall not recognize for any purpose any purported
Disposition of all or part of the Member's Membership Interest or any right or
interest appertaining thereto unless and until the Company has received a
document (i) executed by both the Member effecting the Disposition and the
Person acquiring such Membership Interest or part thereof, (ii) including the
notice address of any Person to be admitted to the Company as a Substitute
Member and such Person's agreement to be bound by this Agreement in respect of
the Membership Interest or part thereof being obtained, (iii) setting forth the
Membership Interest of the parties to the Disposition after the Disposition, and
(iv) containing a warranty and representation that the Disposition was made in
accordance with this Agreement and all applicable laws and regulations. Each
Disposition and, if applicable, admission complying with the provisions of this
Section 4.4 is effective as of the date of the document described in this
Section 4.4(c), but only if the other requirements of this Section 4.4 have been
met.
(d) Notwithstanding any other provision of this Agreement, the
Disposition of the Membership Interest, or any right, title or interest therein
or thereto, will not be permitted if the Membership Interest sought to be
Disposed of, when added to the total of all other Membership Interests Disposed
of within the period of twelve (12) consecutive months ending with the proposed
date of the Disposition, results in a termination of the Company under Section
708 of the Code.
(e) Notwithstanding any other provision of this Agreement, no
Disposition shall be effected while any Bonds are outstanding without the prior
written affirmation of the nationally-recognized statistical rating agency or
agencies rating such Bonds that such Disposition will not result in a downgrade,
qualification or withdrawal of the ratings then assigned to such Bonds, if as a
result of such Disposition an entity that beneficially or constructively owned
less than 49% of the Membership Interests in the Company would as a result of
the contemplated Disposition beneficially or constructively own greater than 49%
of the Membership Interests in the Company.
Section 4.5 BANKRUPT MEMBER; CONTINUATION. Notwithstanding any
other provision of this Agreement, a Member shall not cease to be a Member as a
result of such Member becoming a Bankrupt Member and, upon the occurrence of
such event, the Company shall continue without dissolution. Notwithstanding any
other provision of this Agreement, a Member waives any right that it might have
under Section 18-801(b) of the Act to agree in writing to dissolve the Company
upon such Member becoming a Bankrupt Member or the occurrence of any event that
causes such Member to cease to be a Member of the Company. Upon the occurrence
of any other statutory event of termination, the remaining owners of the Company
have the right to continue the Company by a majority in interest voted unless a
higher vote is required by the state statute or by the IRS classification
regulations allowing avoidance of the corporate characteristic of continuity of
interest.
Section 4.6 TWO MEMBERS REQUIRED. For so long as any Bonds are
outstanding, the Company shall have not less than two Members, one of which
shall be either the Trust or another special purpose entity as to which the vote
of an Independent Representative is required for such entity to take certain
actions as a Member hereunder.
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Section 4.7 OTHER ACTIVITIES OF THE MEMBERS AND THEIR AFFILIATES.
Except as expressly provided in this Agreement, the Members and their Affiliates
may engage in other business ventures of every nature, independently or with
others, whether or not competitive with the business of the Company, and neither
the Company nor any of the other Members shall have any right in such
independent ventures or to the income and profits derived therefrom.
ARTICLE V
CAPITAL CONTRIBUTIONS
Section 5.1 INITIAL CAPITAL. Each of the Managing Member and the
Special Managing Member has contributed cash totaling $990 and $10,
respectively. Each Member may contribute in the future any additional capital
deemed necessary by the Managing Member, in its sole discretion, for the
operation of the Company.
Section 5.2 ADDITIONAL CAPITAL. Except as specifically set forth
elsewhere in this Agreement, no Member shall be required to contribute capital
to the Company in excess of such Member's initial Capital Contribution, and the
Membership Interests of the Members shall remain fixed at the percentages
indicated in the definition of "Membership Interest". The value of any property
contributed to the Company shall be determined by any reasonable method as the
Managing Member, in its discretion, shall decide.
Section 5.3 RETURN OF CONTRIBUTIONS. A Member is not entitled to
demand the return of any part of its Capital Contribution or to payment of
interest in respect of either its Capital Account or its Capital Contribution.
Except as otherwise expressly set forth in this Agreement, neither the Company
nor any Member has any obligation to return the Capital Contribution of a
Member.
ARTICLE VI
PROFITS, LOSSES, ACCOUNTING, TAXES AND DISTRIBUTION
Section 6.1 ALLOCATION OF PROFITS AND LOSSES. Except as otherwise
provided herein, net profits from the operation of the business of the Company
(including gain from the sale, exchange or other disposition of all or any
significant portion of the assets of the Company) and net losses incurred by the
Company shall be allocated among and borne by the Members in accordance with
their Membership Interests.
Section 6.2 BOOKS; FISCAL YEAR; ACCOUNTING TERMS. The Company
books shall be maintained at the offices of Main Place Funding, LLC, and each
member shall have access thereto. The fiscal year of the Company shall be the
calendar year, and the books shall be closed and balanced at the end of each
fiscal year. The Company will furnish annual financial statements to the members
upon request, and prepare tax returns as required in a timely manner.
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Section 6.3 CAPITAL ACCOUNTS. The Company shall maintain a
capital account for each of the Members in such manner as the Managing Member
shall determine in its sole discretion.
Section 6.4 DISTRIBUTIONS. The Members shall share in all
post-formation profits and surplus of the Company according to their Membership
Interest. The Members agree for themselves and their successors, assigns and
heirs, that their participation is considered a long-term investment, and that
any return of capital prior to the termination and winding up of the Company is
in the sole discretion of the Managing Member, subject to Section 18-607 of the
Act.
Section 6.5 TAX RETURNS. The Managing Member shall cause to be
prepared and filed all necessary federal, state and local income tax returns and
all other tax returns required of the Company.
Section 6.6 TAX MATTERS PARTNER. To the extent that such a "tax
matters partner" is required for the Company, the Managing Member shall be the
"tax matters partner" of the Company pursuant to Section 6231(a)(7) of the Code.
The "tax matters partner" shall inform each Member of all significant matters
that may come to its attention in its capacity as "tax matters partner" by
giving notice thereof on or before the tenth business day after becoming aware
thereof and, within that time, shall forward to each Member copies of all
significant written communications it may receive in that capacity. The "tax
matters partner" may not take any action contemplated by Sections 6222 through
6232 of the Code without the consent of every Member affected by such action.
Section 6.7 WITHDRAWALS. No Member shall be entitled to make
withdrawals from its Capital Account.
Section 6.8 BANKING. All funds of the Company shall be deposited
in its name in such bank account or accounts as shall be designated by the
Managing Member. All withdrawals therefrom are to be made upon the authority of
such person or persons as may be authorized by the Managing Member from time to
time.
Section 6.9. TAX CLASSIFICATION. The Members intend that the
Company be disregarded as an entity separate from its owner for federal income
tax purposes.
ARTICLE VII
MANAGEMENT, LIABILITY OF MEMBERS,
RIGHTS TO OBTAIN INFORMATION
Section 7.1 MANAGING MEMBER. Except as otherwise specifically
provided in this Agreement, the Managing Member shall have the authority to, and
shall, conduct the affairs of the Company.
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Section 7.2 POWERS OF THE MANAGING MEMBER.
(a) Without limiting the generality of the foregoing Section 7.1,
the Managing Member shall have the power and authority to:
(1) establish a record date with respect to all actions to be
taken hereunder that require a record date be established, including with
respect to allocations and distributions;
(2) bring and defend on behalf of the Company actions and
proceedings at law or in equity before any court or governmental, administrative
or other regulatory agency, body or commission or arbiter or otherwise; and
(3) execute all documents or instruments, perform all duties and
powers and do all things for and on behalf of the Company in all matters
necessary, desirable, convenient or incidental to the purpose of the Company,
including, without limitation, all documents, agreements and instruments related
to the making of investments of Company funds, the borrowing of money by the
Company, the taking of actions in the name of or on behalf of the Company and
the execution of Member consents with respect thereto.
In managing the business and affairs of the Company, the Managing
Member may act as Managing Member or agent or attorney-in-fact, as the case may
require, and any action taken by the Managing Member in such capacity and in
accordance with this Agreement shall be binding upon the Company. The expression
of any power or authority of the Managing Member in this Agreement shall not in
any way limit or exclude any other power or authority of the Managing Member
which is not specifically or expressly set forth in this Agreement.
(a) No Management by Other Persons or Entities. Except for the
Special Managing Member to the extent provided in this Agreement, no person or
entity other than the Managing Member (including without limitation the other
Members) shall be an agent or attorney of the Company or have any right, power
or authority to transact any business in the name of the Company or to act for
or on behalf of or to bind the Company, except as (and only to the extent)
expressly delegated by the Managing Member.
(b) Reliance by Third Parties. Any person or entity dealing with
the Company, the Managing Member or the Special Managing Member may rely upon a
certificate signed by the Managing Member as to:
(1) the identity of the Managing Member, the Special Managing
Member or other Members (if any);
(2) the existence or non-existence of any fact or facts which
constitute a condition precedent to acts by the Managing Member, the Special
Managing Member or the Company or are in any other manner germane to the affairs
of the Company;
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(3) the persons who or entities which are authorized to execute
and deliver any instrument or document of or on behalf of the Company; or
(4) any act or failure to act by the Company or as to any other
matter whatsoever involving the Company, the Managing Member or the Special
Managing Member.
(c) Interests of Creditors. When making decisions on behalf of the
Company, the Managing Member shall consider the interests of creditors of the
Company as well as the interests of the Members, to the extent permitted by law.
Section 7.3 ACTIONS REQUIRING CONSENT.
(a) For so long as any Bonds are outstanding and until all of the
obligations of the Company under the indentures or the Bonds have been
indefeasibly and fully satisfied, notwithstanding any other provision of law
that otherwise so empowers the Company, the Company shall not, without the
unanimous consent of all of the Members (which consent on behalf of the Trust
shall have been approved and authorized by the Independent Representative);
(i) commence any case, proceeding or other action on behalf of
the Company under any existing or future law of any jurisdiction relating to
bankruptcy, insolvency, reorganization or relief of debtors;
(ii) institute proceedings, including filing a voluntary
petition, to have the Company adjudicated as bankrupt or insolvent;
(iii) consent to the institution of bankruptcy or insolvency
proceedings against the Company;
(iv) file a petition or consent to a petition seeking
reorganization, arrangement, adjustment, winding-up, dissolution, composition,
liquidation or other relief on behalf of the Company of its debts on behalf of
its debts under any federal or state law relating to bankruptcy;
(v) seek or consent to the appointment of a receiver, liquidator,
assignee, trustee, sequestrator, custodian or any similar official for the
Company or a substantial portion of its properties or a substantial portion of
its properties;
(vi) make any assignment for the benefit of the Company's
creditors; or
(vii) take any action or cause any other Person to take any
action in furtherance of any of the foregoing.
(b) For so long as any Bonds are outstanding and until all of the
obligations of the Company under the indentures or the Bonds have been
indefeasibly and fully satisfied, without the prior written affirmation of each
nationally-recognized statistical rating agency or
15
agencies rating such Bonds that the taking, by the Company, of the desired
action or actions provided below in subparagraphs (i) through (v) of this
paragraph (b) will not result in a downgrade, qualification or withdrawal of
rating or ratings assigned to such Bonds, the Company shall not:
(i) to the fullest extent permitted by law, dissolve or
liquidate, in whole or in part;
(ii) merge or consolidate with any other entity other than with
an entity wholly owned, directly or indirectly, by an entity owning 100% of the
membership interests of the Company and having a certificate of incorporation or
other organizational document containing provisions substantially identical to
the provisions of Sections 3.1, 3.3, 4.4(e), 4.5, 4.6, 8.1, Article IX, Article
XI and this Section 7.3;
(iii) sell all or substantially all of its assets;
(iv) amend this Agreement to alter in any manner or delete
Sections 3.1, 3.3, 4.4(e), 4.5, 4.6, 8.1, Article IX, Article XI or this Section
7.3; or
(v) engage in any business activity other than that provided for
in Section 3.1.
(c) To the fullest extent permitted by applicable law, no Member shall
be guilty of breaching any fiduciary duty to any other Member by refusing to
consent to any of the above listed actions.
Section 7.4 OFFICERS.
(a) The Company shall have an officer designated as the Company's
President who shall be appointed from time to time by the Managing Member. The
President shall be the chief operating officer of the Company. The President of
the Company is hereby delegated the power, authority and responsibility of the
day-to-day management, administrative, financial and implementive acts of the
Company's business. The President of the Company shall have the right and power
to bind the Company and to make the final determination on questions relative to
the usual and customary daily business decisions, affairs and acts of the
Company. Other primary management functions of the Company shall be assigned by
the Managing Member.
(b) The Company shall also have officers designated as vice presidents
who shall be appointed from time to time by the Managing Member. The vice
presidents shall have such powers and duties as may from time to time be
assigned to them by the Managing Member or the president. At the request of the
president, or in the case of his absence or disability, the vice president
designated by the president (or in the absence of such designation, the vice
president designated by the Managing Member) shall perform all the duties of the
president and when so acting, shall have all the powers of the president.
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(c) The Managing Member may appoint such other officers as it may deem
advisable from time to time. Each officer of the Company shall hold office at
the pleasure of the Managing Member, and the Managing Member may remove any
officer at any time, with or without cause. If appointed by the Managing Member,
the officers shall have the duties assigned to them by the Managing Member.
(d) The present officers of the Company are as follows:
Xxxx X. Xxxx President/Principle Executive Officer
Xxxx X. Xxxxx Treasurer and Senior Vice President/Principle Financial and
Accounting Officer
Xxxx X. Xxxxxxxx Senior Vice President/Tax Officer
Xxxxxxx X. Xxxxxxxx Executive Vice President
Xxxxxx X. Xxxxxxx Executive Vice President
Xxxxx X. Xxxxxxx Vice President
Xxxxx X. Xxxxx Vice President/Tax Officer
Xxxx-Xxx Xxxxx Secretary
Section 7.5 INDEMNIFICATION.
(a) The Members shall not have any liability for the obligations
or liabilities of the Company, except to the extent, if any, expressly provided
in the Act. The Company shall, to the fullest extent permitted by applicable
law, indemnify and hold harmless each Member (an "Indemnified Person") against
any obligations or liabilities of the Company which may be imposed upon (or
which any person may seek to impose upon) such Member (including the costs of
defending against such a claim) in contravention of this Section 7.5.
(b) The Company shall, to the fullest extent permitted by
applicable law, indemnify and hold harmless each Indemnified Person against any
losses, claims, damages or liabilities (including without limitation reasonable
attorney's fees) to which such Indemnified Person may become subject in
connection with any matter arising from, related to, or in connection with, this
Agreement or the Company's business or affairs, except for such losses, claims,
damages or liabilities as are determined by final judgment of a court of
competent jurisdiction to have resulted from such Indemnified Person's gross
negligence or willful misconduct.
(c) Notwithstanding anything else contained in this Agreement,
the indemnity obligations of the Company under paragraph (b) above shall:
(i) be in addition to any liability that the Company may
otherwise have;
(ii) extend upon the same terms and conditions to the
directors, committee members, officers, stockholders, partners, members,
control persons, employees, agents and representatives of each
Indemnified Person;
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(iii) be binding upon and inure to the benefit of any
successors, assigns, heirs and personal representatives of each
Indemnified Person and any such persons;
(iv) be limited to the assets of the Company; and
(v) be subordinate to the Company's obligations in respect
of Bonds as set forth in Section 11.1(b)(xii) of this Agreement.
Section 7.6 EXCULPATION; DUTIES.
(a) No Member or officer of the Company shall be liable to the
Company or any other Person who has an interest in the Company for any loss,
damage or claim incurred by reason of any act or omission performed or omitted
by such Member or officer in good faith on behalf of the Company and in a manner
reasonably believed to be within the scope of the authority conferred on such
Member or officer by this Agreement, except that a Member or officer shall be
liable for any such loss, damage or claim incurred by reason of such Member's or
officer's willful misconduct or gross negligence.
(b) To the extent that at law or in equity, the Managing Member
or an officer, employee or agent of the Company has duties (including fiduciary
duties) and liabilities relating thereto to the Company or to any Member, any
such Member, officer, employee or agent acting under this Agreement shall not be
liable to the Company or to any Member for its good faith reliance on the
provisions of this Agreement. The provisions of this Agreement, to the extent
that they restrict the duties and liabilities of an Indemnified Person otherwise
existing at law or in equity, are agreed by the Members to replace such other
duties and liabilities of such Member, officer, employee or agent.
(c) Whenever in this Agreement the Managing Member is permitted
or required to make a decision (i) in its "sole discretion", or "discretion" or
under a grant of similar authority or latitude, the Managing Member shall be
entitled to consider only such interest and factors as it desires, including its
own interests, and shall have no duty or obligation to give any consideration to
any interest of or factors affecting the Company or any other Member, or (ii) in
its "good faith" or under another expressed standard, the Managing Member shall
act under such express standard and shall not be subject to any other or
different standards imposed by this Agreement or any other agreement
contemplated herein or by relevant provisions of law or in equity or otherwise.
Section 7.7 VIOLATION OF THIS AGREEMENT. Any member who shall
violate any of the terms, conditions, and provisions of this agreement shall
keep and save harmless the Company property and shall also indemnify the other
then members from any and all claims, demands and actions of every kind and
nature whatsoever which may arise out of or by reason of such violation of any
of the terms and conditions of this agreement.
Section 7.8 EXECUTION OF INSTRUMENTS. All agreements, indentures,
mortgages, deeds, conveyances transfers, contracts, checks, notes, drafts, loan
documents,
18
letters of credit, master agreements, swap agreements, guarantees, certificates,
declarations, receipts, discharges, releases, satisfactions, settlements,
petitions, schedules, accounts, affidavits, bonds, undertakings, proxies and
other instruments or documents may be signed, executed, acknowledged, verified,
attested, delivered or accepted on behalf of the Company by the President, any
Senior Vice President, any Vice President, or any individual who is appointed by
the Managing Member to a position equal to any of the aforementioned officer
positions, or such other officers, employees or agents as the members or any of
such designated officers or individuals may direct. The provisions of this
Article are supplementary to any other provision of this Agreement and shall not
be construed to authorize execution of instruments otherwise dictated by law.
Section 7.9 SCHEDULED DUTIES AND COMPENSATION. Without limiting
the generality of Section 7.2, the Managing Member shall perform the duties
listed in Exhibit A hereto, and shall be entitled to receive the compensation
and reimbursement for certain expenses with respect to the performance of such
duties as set forth on Exhibit A. The Managing Member may also employ
subcontractors with respect to such duties in accordance with Exhibit A.
ARTICLE VIII
DISSOLUTION, LIQUIDATION AND TERMINATION OF THE COMPANY
Section 8.1 DISSOLUTION. The Company shall be dissolved and its
affairs wound up only upon (i) the written consent of all the Members (including
the Independent Representative) and (ii) the entry of a decree of judicial
dissolution under Section 18-802 of the Act. The Company shall not be dissolved
as a result of there no longer being any Members of the Company if the Company
is continued in accordance with Section 18-801(a)(4) of the Act. Notwithstanding
anything in this Agreement to the contrary, to the fullest extent permitted by
applicable law, the Company shall not be dissolved as long as any Bonds are
outstanding.
Section 8.2 LIQUIDATION AND TERMINATION. On dissolution of the
Company, the Managing Member shall appoint one or more Persons, which appointee
or appointees may include itself, to act as a liquidator. The liquidator shall
proceed diligently to wind up the affairs of the Company and make final
distributions as provided herein and in the Act. The costs of liquidation shall
be borne as a Company expense. Until final distribution, the liquidator shall
continue to operate the Company properties with all of the power and authority
of the Managing Member. A reasonable time shall be allowed for the orderly
liquidation of the assets of the Company and the discharge of liabilities to
creditors so as to enable the liquidator to minimize any losses resulting from
liquidation.
Section 8.3 PAYMENT OF DEBTS. The assets shall first be applied
to the satisfaction of all liabilities of the Company other than to its Members
and the expenses of liquidation and to second to any loans or advances that may
have been made by Members to the Company.
19
Section 8.4 REMAINING DISTRIBUTION. The remaining assets shall
then be distributed to the Members according to their Membership Interests.
Section 8.5 RESERVE. Notwithstanding anything to the contrary in
Section 8.4, the liquidator may retain such amount as it deems necessary as a
reserve for any contingent, conditional or unmatured liabilities or obligations
of the Company, which reserve, after the passage of a reasonable period of time
as determined by the liquidator, shall be distributed in accordance with this
Article VIII.
Section 8.6 FINAL ACCOUNTING. Each of the Members shall be
furnished with a statement that sets forth the assets and liabilities of the
Company as of the date of the complete liquidation. Upon compliance by the
liquidator with the foregoing distribution plan, the liquidator shall execute
and cause to be filed a Certificate of Cancellation and any and all other
documents necessary with respect to termination and cancellation of the Company
under the Act. The existence of the Company as a separate legal entity shall
continue until the cancellation of its Certificate of Formation.
ARTICLE IX
AMENDMENTS
Section 9.1 AUTHORITY TO AMEND. This Agreement may only be
amended with approval of all the Members. Notwithstanding anything in this
Agreement to the contrary, the following provisions of this Agreement may not be
amended as long as any Bonds are outstanding without the prior written
affirmation of each nationally-recognized statistical rating agency or agencies
rating such Bonds that such amendment or amendments will not result in a
downgrade, qualification or withdrawal of the rating or ratings assigned to such
Bonds: Sections 3.1, 4.4(e), 4.5, 4.6, 7.1, 7.2, 7.3 and 8.1 and this Article IX
and Article XI.
ARTICLE X
POWER OF ATTORNEY
Section 10.1 POWER. Each member irrevocably constitutes and
appoints the Managing Member as his true and lawful attorney in his name, place
and xxxxx to make, execute, swear to, acknowledge, deliver and file:
(a) Any certificates or other instruments which may be required
to be filed by the Company under the laws of the State of Delaware or of any
other state or jurisdiction in which the Managing Member shall deem it
advisable;
(b) Any documents, certificates or other instruments, including
but not limited to, any and all amendments and modifications of this Agreement
or of the instruments described in Subsection 10.1(a) which may be required or
deemed desirable by the Managing Member to effectuate the provisions of any part
of this Agreement, and, by way of extension
20
and not in limitation, to do all such other things as shall be necessary to
continue and to carry on the business of the Company; and (c) All documents,
certificates or other instruments which may be required to effectuate the
dissolution and termination of the Company, to the extent such dissolution and
termination is authorized hereby. The power of attorney granted hereby shall not
constitute a waiver of, or be used to avoid, the rights of the Members to
approve certain amendments to this Agreement pursuant to Subsection 9.1 or be
used in any other manner inconsistent with the statutes of the Company as a
limited liability company or inconsistent with the provisions of this Agreement.
Section 10.2 SURVIVAL OF POWER. It is expressly intended by each
Member that the foregoing power of attorney is coupled with an interest, is
irrevocable and shall survive the death, retirement or adjudication of
incompetency of such Member. The foregoing power of attorney shall survive the
delivery of an assignment by the Member of its entire interest in the Company,
except that where an assignee of such entire interest has become a Substitute
Member, then the foregoing power of attorney of the assignor Member shall
survive the delivery of such assignment for the sole purpose of enabling the
Managing Member to execute, acknowledge and file any and all instruments
necessary to effectuate such substitution.
ARTICLE XI
SEPARATE LEGAL ENTITY
Section 11.1 SEPARATE LEGAL ENTITY.
(a) The Company shall respect and appropriately document the separate and
independent nature of its activities, as compared with those of any other
Person, take all reasonable steps to continue its identity as a separate legal
entity, and make it apparent to third Persons that the Company is an entity with
assets and liabilities distinct from those of any other Person. Without limiting
the foregoing, the Company shall:
(i) maintain books and records separate from any other
Person or entity;
(ii) maintain its accounts separate from those of any
other Person or entity;
(iii) conduct its own business in its own name;
(iv) maintain separate financial statements;
(v) pay its own liabilities out of its own funds;
(vi) observe all limited liability company formalities
and other formalities required by the organic documents;
21
(vii) maintain an arm's-length relationship with its
Affiliates;
(viii) pay the salaries of its own employees and maintain
a sufficient number of employees in light of its contemplated business
operations;
(ix) allocate fairly and reasonably any overhead for
shared office space;
(x) use separate stationery, invoices, and checks;
(xi) hold itself out as a separate entity;
(xii) correct any known misunderstanding regarding its
separate identity; and
(xiii) maintain adequate capital in light of its
contemplated business operations.
Failure to comply with any of the foregoing covenants shall not
affect the status of the Company as a separate legal entity.
(b) The Company shall not:
(i) commingle assets with those of any other entity;
(ii) guarantee or become obligated for the debts of any
other entity or hold out its credit as being available to satisfy the
obligations of others;
(iii) acquire obligations or securities of its members
(other than in the ordinary course of its business); and
(iv) pledge its assets for the benefit of any other
entity or make any loans or advances to any entity (other than in the
ordinary course of its business).
Failure to comply with any of the foregoing covenants shall not
affect the status of the Company as a separate legal entity.
ARTICLE XII
MISCELLANEOUS
Section 12.1 METHOD OF GIVING CONSENT. Any consent of the Member
required by this Agreement may be given by a written consent, given by the
consenting Member and received by the Person soliciting such consent.
22
Section 12.2 GOVERNING LAW. This Agreement and the rights and
duties of the Members shall be governed by and construed in accordance with the
laws of the State of Delaware, without regard to principles of conflict of laws.
Section 12.3 AGREEMENT FOR FURTHER EXECUTION. At any time or
times upon the request of the Managing Member, each Member agrees to sign and
swear to any certificate, any amendment to or cancellation of such certificate,
acknowledge similar certificates or affidavits or certificates of fictitious
firm name or the like (and any amendments or cancellations thereof) required by
the laws of the State of Delaware, or any other jurisdiction in which the
Company does, or proposes to do, business. This Section 12.3 shall not prejudice
or affect the rights of the Members to approve amendments to this Agreement
pursuant to Section 9.1.
Section 12.4 ENTIRE AGREEMENT. This Agreement contains the entire
understanding between the parties and supersedes any prior understandings or
agreements between them respecting the within subject matter. There are no
representations, agreements, arrangements or understandings, oral or written,
between the parties hereto relating to the subject matter of this Agreement
which are not fully expressed.
Section 12.5 SEVERABILITY. This Agreement is intended to be
performed in accordance with, and only to the extent permitted by, all
applicable laws, ordinances, rules and regulations of the jurisdictions in which
the Company does business. If any provision of this Agreement or the application
thereof to any Person or circumstance shall, for any reason and to any extent,
be invalid or unenforceable, the remainder of this Agreement and the application
of such provision to other Persons or circumstances shall not be affected
thereby, but rather shall be enforced to the greatest extent permitted by law.
Section 12.6 NOTICES. Notices to Members or to the company shall
be deemed to have been given when personally delivered or mailed, by prepaid
registered or certified mail, addressed as set forth in this Agreement, unless a
notice of change of address has previously been given in writing by the
addressee to the addressor, in which case such notice shall be addressed to the
address set forth in such notice of change of address.
Section 12.7 COUNTERPARTS. This Agreement may be executed in
multiple counterparts, each one of which shall constitute an original executed
copy of this Agreement.
Section 12.8 WAIVER OF PARTITION. Each Member hereby waives any
right to partition of the Company property.
Section 12.9 PRONOUNS. All pronouns and any variations thereof
shall be deemed to refer to the masculine, feminine, neuter, singular or plural,
as the identity of the person or persons may require.
Section 12.10 TITLES AND CAPTIONS. All titles and captions are
for convenience only, do not form a substantive part of this Agreement, and
shall not restrict or enlarge any substantive provisions of this Agreement.
23
IN WITNESS WHEREOF, the parties have hereunto set their hands as
of the day and year first above written.
NATIONSBANK, N.A.
By:/s/ Xxxx X. Xxxx
----------------------------
Name: Xxxx X. Xxxx
Title: Senior Vice President
MAIN PLACE TRUST
By:/s/ Xxxx X. Xxxx
-----------------------------
Name: Xxxx X. Xxxx
Title: Trustee
24
EXHIBIT A
Scheduled Duties and Compensation of
Managing Member
Without limiting the generality of Section 7.1, but subject to
Section 7.3, the Managing Member shall:
(a) administer the day-to-day operations and affairs of the
Company, including without limitation, the performance or supervision of
the functions described in this Exhibit A;
(b) monitor the credit quality of the mortgage loans and other
real estate mortgage assets held by the Company;
(c) manage the affairs of the Company with respect to the
acquisition, management, financing and disposition of the Company's
mortgage loans and other real estate mortgage assets;
(d) represent the Company in its day-to-day dealings with Persons
with whom the Company interacts, including without limitation,
securityholders of the Company, transfer agents, consultants,
accountants, attorneys, servicers of the Company's mortgage loans,
custodians, insurers and banks;
(e) establish and provide necessary services for the Company,
including executive, administrative, accounting, shareholder relations,
secretarial, recordkeeping, copying, telephone, mailing and distribution
facilities;
(f) provide the Company with office space, conference room
facilities, office equipment and personnel necessary for the services to
be performed by the Managing Member hereunder at a reasonable market
price;
(g) maintain communications and relations with the members of the
Company, including but not limited to, responding to inquiries, proxy
and consent solicitations, providing reports to securityholders and
arranging and coordinating all meetings of members;
(h) arrange for the investment and management of any short-term
investments of the Company;
(i) arrange for the services of third parties, including but not
limited to mortgage loan servicers who may be the Managing Member or
affiliates of the Managing Member, to collect and distribute funds of
the Company;
(j) monitor and supervise the performance of all parties who have
contracts to perform services for the Company, provided that the
Managing Member shall have no duty to assume the obligations or
guarantee the performance of such parties under such contracts;
(k) establish and maintain such bank accounts in the name of the
Company as may be required by the Company and ensure that all funds
collected by the Managing Member in the name or on behalf of the Company
shall be held in trust and shall not be commingled with the Managing
Member's own funds or accounts;
(l) arrange for the execution and delivery of such documents and
instruments by the officers of the Company as may be required in order
to perform the functions herein described and to take any other required
action;
(m) arrange for insurance for the Company to be paid for by the
Company, including liability insurance, errors and omissions policies
and officers and directors policies which shall cover and insure the
Company, and the members (in such amounts as the Managing Member may
deem advisable) and officers of the Company;
(n) maintain proper books and records of the Company's affairs;
(o) consult and work with legal counsel for the Company to
implement Company decisions and undertake measures consistent with all
pertinent Federal, state and local laws and rules or regulations of
governmental or quasi-governmental agencies, including, but not limited
to, Federal and state securities laws, the Code, and the regulations
promulgated under each of the foregoing;
(p) consult with work with accountants for the Company in
connection with the preparation of financial statements, annual reports
and tax returns;
(q) arrange for an annual audit of the books and records of the
Company by an accounting firm;
(r) prepare and distribute in consultation with the accountants
for the Company, annual reports to members, the trustee under any
indenture of the Company to which the Company is a party or the
Securities and Exchange Commission, which will contain audited financial
statements,
(s) furnish reports to the members and provide research,
economical and statistical data in connection with the Company's
investments;
(t) as reasonably requested by the members, make reports to the
Company of its performance of the foregoing services and furnish advice
and recommendations with respect to other aspects of the business of the
Company; and
(u) maintain appropriate books of account and records relating to
services performed hereunder, and such books of account and records
shall be accessible for inspection by any member at all times.
Compensation. The Company shall pay to the Managing Member, for
services rendered by the Managing Member hereunder, a management fee payable
annually in an amount equal to $500,000 per year, subject to adjustment upon 90
days' notice by the Managing Member to the Company of the proposed change and to
the Company's consent thereto.
Expenses. (a) Without regard to the compensation received
pursuant to Section 3, the Managing Member will bear the following expenses:
(i) employment expenses of the personnel employed by the
Managing Member, including without limitation, salaries, wages, payroll
taxes and the cost of employee benefit plans; and
(ii) rent, telephone equipment, utilities, office
furniture and equipment and machinery and other office expenses of the
Managing Member incurred in connection with the maintenance of any
office facility of the Managing Member.
(b) The Company shall reimburse the Managing Member within 30
days of a written request by the Managing Member for any expenses referenced in
(a) above. All other expenses shall be paid by the party receiving the benefit
of the services rendered.
Subcontracting. The Managing Member may at any time subcontract
all or a portion of its obligations under this Agreement to any Affiliate of the
Managing Member. The Managing Member shall not subcontract, and shall not permit
any of its Affiliates to subcontract, any of its obligations under this
Agreement to Persons who are not Affiliates of the Managing Member.
Notwithstanding the foregoing, the Managing Member will not, in connection with
subcontracting any of its obligations under this Agreement, be relieved or
discharged in any respect from its obligations under this Agreement.
