Operating Agreement of BigPringle, LLC
of
BigPringle,
LLC
This
Operating Agreement (this “Agreement”) is made effective
as of October 6, 2008 by ▇▇▇▇▇▇ SWI Wind Farms, LLC, a Delaware limited
liability company, as the sole member (the “Sole Member”) of BigPringle,
LLC, a Delaware limited liability company (the “Company”).
RECITALS
The
Company was organized under Delaware law on September 10, 2008.
The Sole
Member desires to enter into this initial operating agreement.
The
Company has no current intention of admitting additional members. If
additional members are admitted, the Company and the Sole Member will amend or
replace this Agreement, as may be necessary or appropriate, to address any
issues raised by joint or multiple ownership of the Company.
ARTICLE
I
DEFINITIONS
AND GENERAL MATTERS
1.1 General
Definitions. In addition to terms defined elsewhere in this
Agreement, the following terms shall have the meanings indicated
below:
“Act” means the Delaware
Limited Liability Company Act, as amended.
“Certificate of Formation”
means the Certificate of Formation of the Company filed with the Secretary of
State of the State of Delaware on September 10, 2008, as amended from time to
time.
“Internal Revenue Code” means
the Internal Revenue Code of 1986, as amended.
References
to a specific provision of the Act or the Internal Revenue Code shall be deemed
to refer to any successor provision. This Agreement shall constitute
a “limited liability company agreement” for all purposes under the
Act.
1.2 Purpose. The
purpose of the Company is to engage in any lawful activity. Without
limiting the scope of permitted activities, the Company is expressly authorized
to develop, own, finance, construct, operate and maintain a wind energy
generation facility located in ▇▇▇▇▇▇▇▇▇▇ County, Texas, and to engage in any
other activities that are related or incidental to the foregoing.
1.3 Limited
Liability. To the maximum extent permitted by the Act, neither
the Sole Member nor any Manager (as defined below) shall have any personal
obligation for any liabilities of the Company.
1.4 Operating
Names. The Company may conduct operations under its own name
and under such assumed names as deemed appropriate or convenient by the Sole
Member.
1.5 Qualifications in Other
Jurisdictions. The Company shall file a timely qualification
in Texas to transact business as a foreign limited liability company and any
other qualifications or registrations required by law in any other jurisdiction,
if any, in which the Company transacts business.
ARTICLE
II
MANAGEMENT
2.1 Appointment of
Manager. The Company shall be managed by a single manager (the
“Manager”). The
initial Manager of the Company shall be the Sole Member.
2.2 Term of
Manager. The Sole Member shall have the complete authority to
determine the term and identity of the Manager. Without limiting the
scope of the above provision, the Sole Member shall be entitled to appoint a
Manager who holds no membership interest in the Company, and to remove or
replace any Manager at any time and for any reason. A Manager’s term
shall continue until the removal or replacement of the Manager by the Sole
Member, or until (as applicable for the then current Manager) the Manager’s
resignation, retirement, death, disability, dissolution or termination by
operation of law.
2.3 Authority of
Manager. The Manager shall have the authority to take actions
on behalf of the Company to the maximum extent permitted by the Act, subject to
any limitations or requirements expressly set forth in this
Agreement. Without limiting the scope of the foregoing, the Manager
shall be entitled to appoint and remove any “officers” of the Company and to
establish the authority, duties and compensation (if any) regarding such
officers. The parties acknowledge and agree that any such officers
also may hold offices in other entities, including but not limited to the Sole
Member.
2.4 Expenses and
Reimbursement. The Company shall be responsible for all
expenses, costs and liabilities arising from the management, organization or
operation of the Company in accordance with this Agreement. The Sole
Member and the Manager (if different from the Sole Member) shall be entitled to
receive prompt reimbursement from the Company to the extent, if any, that they
incur any such management expenses, unless such management expenses arose from a
material violation of this Agreement, gross negligence, willful misconduct or a
knowing violation of criminal law.
2.5 Compensation. Unless
the Sole Member elects otherwise in writing, no compensation shall be paid by
the Company to the Manager for management services provided as a Manager to the
Company.
ARTICLE
III
MEMBERSHIP
3.1 Admission of
Member. The Sole Member is admitted as a member of the Company
upon its execution of a counterpart to this Agreement.
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3.2 Admission of Additional
Members. The Company shall not admit a member in addition to
the Sole Member unless such admission is required by this Agreement, or unless
all of the following requirements are satisfied: (a) the Sole Member
grants prior written consent to the admission of the additional member; (b) the
Company and the Sole Member amend or replace this Agreement as may be necessary
or appropriate for the purpose of addressing any issues raised by joint or
multiple ownership of the Company; and (c) each person or entity who seeks to be
admitted as a member of the Company both (i) executes the current Limited
Liability Company Agreement of the Company, as amended or replaced in accordance
with this Section, and (ii) makes any required capital contributions to the
Company in full.
3.3
Resignation. The
Sole Member shall not resign or withdraw from the Company, except by operation
of law or as the result of a transfer of the Sole Member’s entire interest in
the Company in accordance with this Agreement.
ARTICLE
IV
TRANSFER
OF INTEREST
4.1 Restriction. The
Sole Member shall be prohibited from assigning, selling, exchanging or otherwise
transferring the Sole Member’s interest in the Company unless all of the
following requirements are satisfied: (a) the proposed transaction
would apply to the entire interest of the Sole Member in the Company; (b) the
proposed transaction would involve one transferee; (c) such transferee tenders
full payment of the required purchase price; (d) such transferee executes, in
the capacity of a member (within the meaning of the Act), a counterpart
signature page to this Agreement; and (e) the Company receives an opinion from
its legal counsel, satisfactory to the Company in form and substance, confirming
that the proposed transaction would not violate any federal or state securities
laws or any other applicable laws. The Sole Member acknowledges and
agrees that the above provision is intended to prevent any transfer that would
result in more than one member and thereby cause the Company to be reclassified
for tax purposes.
4.2 Effect of
Transfer. If the Sole Member transfers the entire interest of
the Sole Member in the Company in accordance with this Agreement, such transfer
shall operate as the complete resignation or withdrawal of the Sole Member from
the Company.
4.3 Related
Matters. Any transaction that is subject to this Article and
that fails in any way to comply with its provisions shall be ineffective and
void.
ARTICLE
V
OFFICES
AND RECORDS
5.1 Offices. The
initial registered office, registered agent and principal office of the Company
shall be as designated in its Certificate of Formation. The Manager,
in the Manager’s sole discretion, shall be entitled to change such designations
from time to time, subject to any requirements of the Act.
5.2 Records. In
compliance with the Act, the Company shall keep accurate and complete records at
its principal office.
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5.3 Inspection. Upon
prior notice of at least three (3) business days to the Manager (if different
from the Sole Member), any designated representative of the Sole Member shall be
entitled, during ordinary business hours, to inspect the records of the Company
and to make copies thereof at the expense of the Sole Member.
ARTICLE
VI
CAPITAL
AND DISTRIBUTIONS
6.1 Capital
Contributions. The Sole Member shall be entitled in its sole
discretion to make capital contributions at any time or from time to
time.
6.2 Loans. Any loans
from the Sole Member to the Company shall be made on commercially reasonable
terms and conditions, and shall not be considered capital
contributions.
6.3 Distributions. Prior
to dissolution (as addressed in Article IX below), the Company shall make
distributions to the Sole Member at least annually of any cash amounts that, in
the reasonable determination of the Manager, are not necessary for the Company’s
operations, expenses or reserves. More frequent distributions of such
cash amounts to the Sole Member shall be made in the discretion of the Manager
or in accordance with the written instructions of the Sole Member (if the Sole
Member is not then serving as the Manager).
ARTICLE
VII
TAX
MATTERS
7.1 Tax
Classification. While the Company has only one member, the
Company shall be a disregarded entity for federal income tax purposes in
accordance with the Internal Revenue Code and the applicable Treasury
Regulations (including temporary Regulations), and shall not be separate from
the Sole Member. In addition, the Company shall be a disregarded
entity for all other tax purposes to the maximum extent permitted by applicable
laws, including (without limitation) state income tax, franchise tax, or similar
entity income or value tax laws.
7.2 Tax Identification
Number. The Company may obtain a federal tax
identification number for business purposes or state law purposes in the sole
discretion of the Manager. Any obtainment of such identification
number shall be deemed an act of convenience by the Company, and shall not have
any effect on the Company’s tax classification for any purpose.
ARTICLE
VIII
INDEMNIFICATION
AND REIMBURSEMENT
8.1 General Scope. The
term “Indemnified
Person” as used in this Article (a) shall refer to the Sole Member, the
Manager, and each officer (if any); and (b) shall be deemed to include (to the
extent applicable) each direct and indirect owner, shareholder, director,
officer, member, manager, partner, employee and representative of any person or
entity described in subsection (a) immediately above.
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8.2 Indemnification. The
Company shall indemnify and protect each Indemnified Person to the maximum
extent permitted by applicable law against any and all claims, liabilities,
damages, losses, costs and expenses (including but not limited to reasonable
legal fees and costs) arising directly or indirectly from any suit, action,
investigation or other proceeding (whether formal or informal) that both (a) is
brought or threatened against an Indemnified Person; and (b) is based on the
acts or omissions of such Indemnified Person on behalf of the Company, other
than acts or omissions constituting a material violation of this Agreement,
gross negligence, willful misconduct or a knowing violation of criminal
law.
8.3 Payment to Indemnified Person.
If an Indemnified Person incurs or pays any indemnified cost, the Company
shall reimburse the Indemnified Person for the full amount of such indemnified
cost. In addition, the Company shall advance appropriate amounts for
those reasonable and necessary legal fees (and related costs) the Indemnified
Person expects to incur, based on the Indemnified Person’s good faith
determination, in defending any claim or similar action resulting in
indemnification under this Agreement. Such reimbursement or advance
shall be due promptly after the Company receives each of the
following: (a) a written request for such reimbursement or advance
from the Indemnified Person; (b) all information necessary to establish the
nature and amount of the indemnified cost that was incurred or paid by the
Indemnified Person or the appropriate advance to the Indemnified Person; and (c)
a written agreement from the Indemnified Person to repay such reimbursement or
advance if the Company subsequently determines that indemnification was not
required.
ARTICLE
IX
DISSOLUTION
9.1 Events of Dissolution. The
Company shall dissolve upon the occurrence of any of the following
events: (a) the written instruction of the Sole Member; or (b) any
other event that causes dissolution of the Company under the Act.
9.2 Winding Up
Affairs. Upon the dissolution of the Company, the Manager
shall be responsible for winding up the affairs of the Company. The
Manager shall have the authority to determine the time, place, manner and other
terms of any sales involving the Company’s assets, with due regard to the
activity and the condition of the Company and the relevant market and economic
conditions. Subject to the requirements of this Agreement and the
Act, the Manager shall have the authority to cause the Company to (a) liquidate
any of its assets and then distribute the liquidation proceeds; or (b) make
in-kind distributions of any assets to the Sole Member upon the request of the
Sole Member.
9.3 Final
Distributions. Upon the dissolution of the Company, and
subject to the requirements of the Act, the Manager shall distribute the assets
of the Company in the following order of priority:
(a) first,
to any creditors of the Company;
(b) second,
to known and reasonably estimated costs of dissolution and winding
up;
(c) third,
to any reserves the Manager may establish, in the Manager’s sole discretion, for
contingent debts, liabilities or obligations of the Company;
and
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(d) fourth,
to the Sole Member.
9.4 Filing of Certificate of
Cancellation. Following the winding up of the Company, the
Manager shall be responsible for filing a Certificate of Cancellation on behalf
of the Company, together with any other instruments or documents required to
terminate the Company and its legal existence.
ARTICLE
X
MISCELLANEOUS
PROVISIONS
10.1 Governing Law. The
laws of the State of Delaware, without regard to principles and provisions
relating to conflicts of laws, shall govern this Agreement and all matters
relating to its interpretation or enforcement.
10.2 Amendment. No
amendment of this Agreement shall be binding, valid or enforceable unless it is
approved in writing by each party.
10.3 Other
Agreements. Any prior operating agreements with respect to the
Company, whether oral or written, have been merged and integrated into this
Agreement and are superseded by this Agreement.
10.4 Enforceable
Provisions. All provisions in this Agreement are
severable. Each valid and enforceable provision shall remain in full
force and effect, regardless of any judicial or other official determination
that certain provisions are invalid or unenforceable.
10.5 Captions and
Headings. Captions and headings are used in this Agreement for
convenience only and shall not affect its interpretation or
enforcement. Any terms such as “hereof,” “hereby” and similar
references shall be deemed to refer to this Agreement as a whole, rather than to
any particular provision, unless the context clearly indicates
otherwise.
10.6 Third Party
Beneficiaries. Except as may be expressly set forth in this
Agreement (a) the provisions of this Agreement are not intended for the benefit
of any person or entity who is not a party to this Agreement; and (b) no such
person or entity shall have any rights in connection with this Agreement,
whether for enforcement or otherwise.
10.7 Successors. This
Agreement shall be binding upon, and enforceable against, the parties and all of
their permitted assignees and successors in title or interest.
10.8 Counterparts. This
Agreement may be executed in counterparts, each of which shall be deemed an
original and all of which shall constitute, when taken together, a single
binding instrument.
(Next Page is Signature
Page)
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WITNESS the following signature as of
the first date indicated above.
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SWI Wind Farms, LLC
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By:
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▇▇▇▇▇▇
▇. ▇▇▇▇
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Title:
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Secretary
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