Common use of Change of Member Control Clause in Contracts

Change of Member Control. (a) In the event of a Change of Member Control, the Member with respect to which the Change of Member Control has occurred ("CHANGING MEMBER") shall promptly (and in all events within five Business Days after the Change of Member Control) give notice thereof ("CONTROL NOTICE") to the other Member (in such capacity, the "NON-CHANGING MEMBER"). If the Control Notice is not given by the Changing Member as provided above and the Non-Changing Member becomes aware of such Change of Member Control, such Non-Changing Member shall have the right to give the Control Notice to the Changing Member. The Non-Changing Member shall have the right, but not the obligation, either: (i) to acquire the Membership Interest of the Changing Member for the fair market value thereof (as such, a "BUY-OUT RIGHT") or (ii) to sell the Membership Interest of the Non-Changing Member to the Changing Member for the fair market value thereof (as such, a "SELL-OUT RIGHT"). For purposes of this Section 3.12, "fair market value" means the cash value for which a willing buyer and willing seller under no compulsion would be willing to buy or sell the Membership Interest of the Changing Member. If the Non-Changing Member elects to proceed under clause (i), then the Changing Member shall deliver its proposed fair market value ("FMV NOTICE") of its Membership Interest to the Non-Changing Member within five Business Days after the delivery of the Control Notice. The Non-Changing Member shall then have 15 Business Days after receipt of the FMV Notice to dispute the fair market value set forth therein by notice to the Changing Member. If the Non-Changing Member disputes the fair market value set forth in the FMV Notice, then the parties shall attempt to resolve such dispute. If such dispute is not resolved within 15 Business Days after delivery of the dispute notice, then the fair market value of the Changing Member's Membership Interest shall be determined by one investment banking firm of nationally recognized origin agreed upon by the Changing Member and the Non-Changing Member or failing such agreement, appointed by the Presiding Judge of the United States District Court for the Southern District of Texas, Houston Division, pursuant to a petition to compel appraisal. If such dispute is submitted to the appraiser, the fair market value of the Changing Member's Membership Interest shall be the amount determined by the appraiser. The fair market value of the Changing Member's Membership Interest determined as set forth in this Section 3.12(a) shall be the "FAIR MARKET VALUE." The Changing Member shall pay the expenses associated with any such appraisal. Alternatively, if the Non-Changing Member elects to proceed under clause (ii), then the Non-Changing Member shall deliver its proposed fair market value ("FMV NOTICE") of its Membership Interest to the Changing Member within five Business Days after the delivery of the Control Notice. The Changing Member shall then have 15 Business Days after receipt of the FMV Notice to dispute the fair market value set forth therein by notice to the Non-Changing Member. If the Changing Member disputes the fair market value set forth in the FMV Notice, then the parties shall attempt to resolve such dispute. If such dispute is not resolved within 15 Business Days after delivery of the dispute notice, then the fair market value of the Non-Changing Member's Membership Interest shall be determined by one investment banking firm of nationally recognized standing, agreed upon by the Changing Member and the Non-Changing Member or failing such agreement, appointed by the Presiding Judge of the United States District Court for the Southern District of Texas, Houston Division, pursuant to a petition to compel appraisal. If such dispute is submitted to the appraiser, the fair market value of the Non-Changing Member's Membership Interest shall be the amount determined by the appraiser. The fair market value of the Non-Changing Member's Membership Interest determined as set forth in this Section 3.12(a) shall also be the "FAIR MARKET VALUE." The Non-Changing Member shall pay the expenses associated with any such appraisal. (b) If either the Buy-out Right or the Sell-out Right is exercised in accordance with Section 3.12(a), the closing of the purchase of the Membership Interest shall occur at the principal place of business of the Company on the 30th Day after the expiration of the last applicable period referred to in such Section 3.12(a), unless the Changing Member and the Non-Changing Members, as applicable, agree upon a different place or date. At the closing, following the course of events specified in Section 3.12(a)(i), the Changing Member shall execute and deliver to the Non-Changing Member, as applicable, an assignment of the Membership Interest that is subject to such Change of Member Control free and clear of Encumbrances, other than those created by this Agreement or by the Non-Changing Member, and any other instruments reasonably requested by the Non-Changing Member, as applicable, to give effect to the purchase. The Non-Changing Member, as applicable, shall deliver to the Changing Member in immediately available funds the purchase price provided for in Section 3.12(a), and the Membership Interests, Sharing Ratios and Capital Accounts of the Members shall be deemed adjusted to reflect the effect of the purchase. Alternatively, at the closing following the events specified in Section 3.12(a)(ii), the Non-Changing Member shall execute and deliver to the Changing Member, as applicable, an assignment of the Membership Interest that is subject to such Change of Member Control free and clear of Encumbrances, other than those created by this Agreement or by the Changing Member, and any other instruments reasonably requested by the Changing Member, as applicable, to give effect to the purchase. The Changing Member, as applicable, shall deliver to the Non-Changing Member in immediately available funds the purchase price provided for in Section 3.12(a), and the Membership Interests, Sharing Ratios and Capital Accounts of the Members shall be deemed adjusted to reflect the effect of the purchase.

Change of Member Control. (a) In the event A Change of Member Control shall be deemed to be a Disposition of a Membership Interest and may be consummated only after compliance with the requirements of SECTIONS 3.03(a), (b), (c), (g) and (h); provided, however, that if the transaction giving rise to the Change of Member Control involves the sale of assets which substantially exceed the value of the Membership Interest, then in lieu of the provisions of SECTION 3.03(c), prior to effecting such Change of Member Control, the Member undergoing a Change of Member Control (the "OFFERING MEMBER") shall offer, by written notice (a "CONTROL OFFER") to the other Members (the "OFFEREE MEMBERS"), to sell its Membership Interest to the Offeree Members for a purchase price determined in accordance with respect this paragraph ("FAIR MARKET VALUE"). The Offeree Members shall have the right, to which be exercised by notice (the "CONTROL ACCEPTANCE") from one or both of the Offeree Members to the Offering Member on or before the sixtieth (60th) day following receipt of the Offer (the "CONTROL OFFER PERIOD"), to elect to purchase the Membership Interest of the Offering Member. The Control Acceptance shall be accompanied by the Offeree Member's written designation of three (3) appraisal firms recognized in the United States for purposes of a third-party appraisal if required as contemplated below. If one or both of the Offeree Members timely accepts the Control Offer, the Offeree Member(s) and the Offering Member shall consult for the purpose of determining the Fair Market Value of the Membership Interest. (b) The Offering Member shall comply with the provisions of this SECTION 3.06. (c) If on or before the thirtieth (30th) day after the receipt of the Control Acceptance, such Members have not reached agreement on the Fair Market Value of the Membership Interest, each of the Offeree Members and the Offering Member shall submit a proposed Fair Market Value to the appraisal firm selected by the Offering Member from the list of appraisal firms accompanying the Control Acceptance, together with any supporting documentation such Member deems appropriate. Such appraisal firm shall determine the Fair Market Value by selection of one of the proposed Fair Market Values submitted by the Members (and shall have no authority beyond selection of one of such proposals) as promptly as possible (and in any event on or before the thirtieth (30th) day after submittal of the competing proposals). One-half of the cost of such appraisal shall be paid by the Offering Member and one-half shall be paid by the Offeree Member(s). (d) Each such Member shall provide to the other and, if applicable, the appraisal firm, all information reasonably requested by them, including (in the case of the Offering Member) information regarding the transaction giving rise to the Change of Member Control has occurred and any consideration being paid in connection therewith. ("CHANGING MEMBER"e) The closing of the acquisition of the Membership Interest shall promptly be consummated on or before the sixtieth (60th) day after the determination of the Fair Market Value of the Membership Interest but effective at the end of the calendar month occurring on or immediately prior to such closing. The acquisition shall be consummated at a closing held at the principal offices of the Company (unless otherwise agreed by the Offering Member and the purchaser), at which time the purchaser shall deliver to the Offering Member the purchase price (in the form of immediately available funds), and the Offering Member shall deliver to the purchaser such transfer documentation reasonably acceptable to the purchaser as shall be required to evidence the transfer of such Membership Interest, free and clear of all liens and encumbrances, except those created under this Agreement. (f) If the Offeree Member(s) do not accept the Control Offer within the time and in all events within five Business Days the manner provided above, the Offering Member shall be permitted for a period of ninety (90) days after expiration of the Control Offer Period to consummate the Change of Member Control) give notice thereof ("CONTROL NOTICE") to the other Member (in such capacity, the "NON-CHANGING MEMBER"). If the Control Notice is not given by the Changing Member as provided above and the Non-Changing Member becomes aware of such Change of Member Control, such Non-Changing Member shall have the right to give the Control Notice to the Changing Member. The Non-Changing Member shall have the right, but not the obligation, either: (i) to acquire the Membership Interest of the Changing Member for the fair market value thereof (as such, a "BUY-OUT RIGHT") or (ii) to sell the Membership Interest of the Non-Changing Member to the Changing Member for the fair market value thereof (as such, a "SELL-OUT RIGHT"). For purposes of this Section 3.12, "fair market value" means the cash value for which a willing buyer and willing seller under no compulsion would be willing to buy or sell the Membership Interest of the Changing Member. If the Non-Changing Member elects to proceed under clause (i), then the Changing Member shall deliver its proposed fair market value ("FMV NOTICE") of its Membership Interest to the Non-Changing Member within five Business Days after the delivery of the Control Notice. The Non-Changing Member shall then have 15 Business Days after receipt of the FMV Notice to dispute the fair market value set forth therein by notice to the Changing Member. If the Non-Changing Member disputes the fair market value set forth in the FMV Notice, then the parties shall attempt to resolve such dispute. If such dispute is not resolved within 15 Business Days after delivery of the dispute notice, then the fair market value of the Changing Member's Membership Interest shall be determined by one investment banking firm of nationally recognized origin agreed upon by the Changing Member and the Non-Changing Member or failing such agreement, appointed by the Presiding Judge of the United States District Court for the Southern District of Texas, Houston Division, pursuant to a petition to compel appraisal. If such dispute is submitted to the appraiser, the fair market value of the Changing Member's Membership Interest shall be the amount determined by the appraiser. The fair market value of the Changing Member's Membership Interest determined as set forth in this Section 3.12(a) shall be the "FAIR MARKET VALUE." The Changing Member shall pay the expenses associated with any such appraisal. Alternatively, if the Non-Changing Member elects to proceed under clause (ii), then the Non-Changing Member shall deliver its proposed fair market value ("FMV NOTICE") of its Membership Interest to the Changing Member within five Business Days after the delivery of the Control Notice. The Changing Member shall then have 15 Business Days after receipt of the FMV Notice to dispute the fair market value set forth therein by notice to the Non-Changing Member. If the Changing Member disputes the fair market value set forth in the FMV Notice, then the parties shall attempt to resolve such dispute. If such dispute is not resolved within 15 Business Days after delivery of the dispute notice, then the fair market value of the Non-Changing Member's Membership Interest shall be determined by one investment banking firm of nationally recognized standing, agreed upon by the Changing Member and the Non-Changing Member or failing such agreement, appointed by the Presiding Judge of the United States District Court for the Southern District of Texas, Houston Division, pursuant to a petition to compel appraisal. If such dispute is submitted to the appraiser, the fair market value of the Non-Changing Member's Membership Interest shall be the amount determined by the appraiser. The fair market value of the Non-Changing Member's Membership Interest determined as set forth in this Section 3.12(a) shall also be the "FAIR MARKET VALUE." The Non-Changing Member shall pay the expenses associated with any such appraisal. (bg) If either more than one Offeree Member wishes to purchase the Buy-out Right or the Sell-out Right is exercised in accordance with Section 3.12(a)Membership Interest, the closing provisions of the purchase of the Membership Interest SECTION 3.03(c) shall occur at the principal place of business of the Company on the 30th Day after the expiration of the last applicable period referred to in such Section 3.12(a), unless the Changing Member and the Non-Changing Members, as applicable, agree upon a different place or date. At the closing, following the course of events specified in Section 3.12(a)(i), the Changing Member shall execute and deliver to the Non-Changing Member, as applicable, an assignment of the Membership Interest that is subject to such Change of Member Control free and clear of Encumbrances, other than those created by this Agreement or by the Non-Changing Member, and any other instruments reasonably requested by the Non-Changing Member, as applicable, to give effect to the purchase. The Non-Changing Member, as applicable, shall deliver to the Changing Member in immediately available funds the purchase price provided for in Section 3.12(a), and the Membership Interests, Sharing Ratios and Capital Accounts of the Members shall be deemed adjusted to reflect the effect of the purchase. Alternatively, at the closing following the events specified in Section 3.12(a)(ii), the Non-Changing Member shall execute and deliver to the Changing Member, as applicable, an assignment of the Membership Interest that is subject to such Change of Member Control free and clear of Encumbrances, other than those created by this Agreement or by the Changing Member, and any other instruments reasonably requested by the Changing Member, as applicable, to give effect to the purchase. The Changing Member, as applicable, shall deliver to the Non-Changing Member in immediately available funds the purchase price provided for in Section 3.12(a), and the Membership Interests, Sharing Ratios and Capital Accounts of the Members shall be deemed adjusted to reflect the effect of the purchaseapply.